NATIONAL  SECURITY  AGENCY 
CENTRAL  SECURITY  SERVICE 
FORT  GCONCC  C.  MCA2X.  MARYLAND     207S9 
NSAta  p-80 
9  D€S!5Berl980 
TOP  C EGRET 
MEMORANDUM  FOR  THE  SPECIAL  ASSISTANT,  OFFICE  OF  THE  SECRETARY  OF  DEFENSE 
SUBJECT:  Transition  Coordination    
1.  Please  refer  to  your  memorandum  of/November  11,  1980,  subject  as  above 
2.  I  am  pleased  to  provide  the  enclose>^aterial-f6f  use  by  the  transition 
team.  Mr.  Silverstein  visited  the  National  Security  Agency  recently  and,  as 
a  result  of  those  discussions,  our  input  is  'focusing  on  specific  subjects  in 
which  he  has  expressed  an  interest.  General  introductory  information  and 
factual  data  concerning  this  Agency  is  also  included. 
3.  I  am  prepared  to  follow-up  as  deemed  necessary  on  these  and  other 
subjects  that  may  arise  over  the  next  several  weeks. 
4.  This  correspondence  may  be  declassified  upon  removal  of  the  Enclosures. 
f<U/-   
i.  R.  INKAN 
Vice  Admiral,  U.  S.  Navy 
Director,  NSA/Chief,  CSS 
Ends: 
a/s 
APPENDED  DOCUMENTS  CONTAIN 
TOP  GIZCRLT
TRANSITION  BRIEFING  BOOK 
I.    Introductory  Section 
Mission  and  Authorities 
The  SIGINT  Process  (Overview) 
SIGINT  Requirements  System  (Chart) 
The  COMSEC  Process  (Overview) 
National  Intelligence  Community  Structure  (Chart) 
II.    Organization 
Chart  with  Key  Personnel  Named 
Civilian  Grade  Distribution  . 
FY  1981  Manpower  Allocations 
III.    Program  and  Budget 
Overview 
FY  1981  Budget  (Breakdown  Chart) 
CCP  Budget  by  Target  -  FY  1981  (Chart) 
IV.    The  NSA/CSS  Planning  Process 
* 
V.    SIGINT  Highlights 
Major  Accomplishments 
VI .    Communications  Security 
Description  and  Objectives 
The  National  Communications  Security  Committee 
VII..    Legislative  Summary 
Initiatives 
96th  Congress 
SCES 
97th  Congress  . 
Cryptologic  Equipment  Fund 
Cryptologic  Grant  Program 
Protection  from  Liability  for  Psychologists 
Transportation  of  the  Remains  of  Deceased 
Employees,  Dependents  and  Household  Goods 
Charter  Legislation
*  « 
^*  !f  if^t  V*.  T*1^ 
VIII. 
Issues 
B. 
Management 
1.  E.O.  12036 
Relative  to  the  Budget  Process 
Relative  to  Requirements  and  Tasking 
Relative  to  Restrictions 
A.  NSA  Relationship  with  DASD(I) 
Fiscal  and  Budget 
2.  Modernization  Objectives 
4.  Ten-year  Facilities  Plan 
Other 
2. 
3/ 
A. 
5. 
6. 
7. 
8. 
9. 
Basing 
NSA  Acquisition  of 
Administrative  Subjects 
Civilian  Hiring  Requirements  FY  1981 
Hiring  Limitations /Freeze  and  Impact 
FOIA 
Impact  of  Recent  Lawsand  Court  Decisions  of  Personnel 
and  Personnel  Security  Matters 
Economic  Consequences  of  Field  Assignments 
Shortage  of  Middle-Level  Military  Cryptologic  Technicians 
Excessive  Delays  in  Completion  of  Special  Background 
Investigations  (SBl's)  conducted  for  NSA  by  the  Defense 
Investigative  Service  (DIS) 
Apex  .  , 
Public  Cryptography 
Intelligence  System 
Ratio  of  Contract  Work  Supporting  Hardware  Maintenance/ 
Engineering  and  Software  Maintenance/Development 
J£*?**,r^
NATIONAL  SECURITY  AGENCY/CENTRAL  SECURITY  SERVICE 
MISSION 
(V)  The  National  Security  Agency  was  established  by  Presidential 
Directive  in  1952  as  a  separate  organized  agency  within  the  Department 
of  Defense.  The  Agency  was  assigned  two  primary  missions  -  a  Communications 
Security  mission  and  a  Communications  Intelligence  mission.  The  Director, 
National  Security  Agency  reports  to  the  Secretary  of  Defense.  An  Electronic 
Intelligence  mission  was  added  in  1958.  The  Central  Security  Service  was 
established  by  the  Secretary  of  Defense  in  1971  and  was  placed  under  the 
Director,  NSA. 
(10  As  provided  in  Executive  Order  12036  the  Secretary  of  Defense 
conducts,  as  the  executive  agent  of  the  United  States  Government,  signals' 
intelligence  and  communications  security  activities.  The  Secretary  of 
Defense  discharges  these  executive  agent  responsibilities  through  the  Director, 
National  Security  Agency.  * 
(U)  The  responsibilities  of . the  Dinector,  National  Security  Agency/ 
Chief,  Central  Security  Service  include: 
-  the  establishment  and  operation  of  an  effective,  unified  organization 
for  signals  intelligence  activities; 
-  collection  of  signals  intelligence  information  for  national 
foreign  intelligence  purposes  in  accordance  with  tasking  by  the  National 
Intelligence  Tasking  Center; 
-  processing  of  signals  intelligence  data  for  national  foreign 
intelligence  purposes  consistent  with  standards  for  timeliness  established 
by  the  Director  of  Central  Intelligence; 
-  executing  the  responsibilities  of  the  Secretary  of  Defense  as 
executive  agent  for  the  communications  security  of  the  United  States  Government; 
-  conducting  research  and  development  to  meet  the  needs  of  the 
United  States  for  signals  intelligence  and  communications  security. 
(U)  The  Director,  National  Security  Agency/Chief,  Central  Security 
Service  directs  and  manages  the  United  States  signals  intelligence  system, 
an  entity  that  is  comprised  of  (A)  the  National  Security  Agency  (including 
assigned  military  personnel);  (B)  those  elements  of  the  military  departments 
and  the  Central  Intelligence  Agency  performing  signals  intelligence  activities; 
(U)  Relevant  current  documents: 
-  National  Security  Council  Intelligence  Directive  No.  6,  Signal* 
Intelligence,  17  February  1972
-  National  Communications  Security  Directive,  20  June  1979  ^-_ 
-  Presidential  Directive/NSC-24,  Telecommunications  Protection  s~ 
Policy,  November  16,  1977  ^~~ 
-  Pol)  Directive  S-5100.20,  The  National  Security  Agency  and  ^ 
the  Central  Security  Service,  23  December  1971 
-  DoD  Directive  S-3115.7,  Signals  Intelligence,  25. January  1973       s~ 
-  DoD  Directive  C-5200.5,  Communications  Security  (COMSEC)  (U) , 
13  April  1971  ^ 
Executive  Order  12036,  United  States  Intelligence  Activities, 
26  January  1978 
C 
NOTE:   Proposed  legislation  which  would  provide  a  legislative  charter  for  NSA 
was  introduced  in  the  96th  Congress.   It  is  unlikely  that  floor  action  .will 
occur  during  this  session.
"tr*  *-•?  ^r»"  < 
THE  SIGNALS  INTELLIGENCE  PROCESS  -  OVERVIEW 
-fS}  The  United  States  SIGINT  Systems  (USSS)  includes  the  National 
Security  Agency  and  the  SIGINT  components  of  the  military  departments; 
the  U.S.  Army  Intelligence  and  Security  Command,  the  Naval 
Security  Group  Command,,  and  the  U.S.  Air  Force  Electronic  Security  Command , 
*TS^  The  USSS  responds  to  requirements  expressed  by  the  Director  of 
Central  Intelligence  and  collection  tasking  is  levied  upon  signals  intelligence 
field  operating  activities  which  are  locatedl       MM  ll 
M        HMMMM   ll  Time-sensitive  reqiurements  are  received 
directly  from  the  military  services  to  support  their  tactical  needs.     *
4j?'U IXJ J  3 i^ *. 8  si  0  it *i J 
THE  COMMUNICATIONS  SECURITY  PROCESS  -  OVERVIEW 
(U)  The  overall  goal  of  communications  security  (COMSEC)  is  to  protect 
all  national  security  and  national  security  related  communications  from  foreign 
adversary  exploitation.  Operations  of  particular  concern  for  COMSEC  are  those 
conducted  by: 
a.  The  National  Command  Authority  (NCA) ; 
b.  Joint  Chiefs  of  Staff  (JCS) ; 
c.  Unified  and  specified  military  commands;  and        • 
d.  Individual  military  units,  especially  combat  units. 
COMSEC  efforts  are  aimed  at  increasing  the  reliability  and  life  expectancy  of 
existing  COMSEC  hardware  and  integrating  appropriate  COMSEC  measures  into  early 
development  stages  of  new  and  advanced  communications  systems. 
•fe^-As  a  primary  mission,  executing  the  COMSEC  responsibilities  of  the 
Secretary  of  Defense  as  the  U.S.  Government's  Executive  Agent,  NSA's  role  includes 
the  following  principal  responsibilities: 
1.  Prescribe  or  approve  all  cryptologic  systems  and  techniques  used 
to  protect  national  security  related  information  from  exploitation  or  disruption; 
2.  Perform  R&D  to  fulfill  requirements  of  the  departments  and  agencies 
and  to  advance  COMSEC  technology; 
3.  Generate  and  produce  COMSEC  material; 
L. 
5.  Maintain  an  overview  of  COMSEC  resources; 
6.  Prescribe  minimum  COMSEC  security  standards;  and 
7.  Develop  and  promulgate  COMSEC  doctrine.
COMFIiD^TOE 
KSA/CSS  CIVILIAN  GRAD7.  DISTRIBUTION 
(as  of  1  December  1980) 
GRADE  LEVEL 
Exec  Level 
GU-18 
GG-17 
GG-16 
GG-15 
GG-14 
GG-13 
GC-12 
GG-11 
GG-10 
GG-  9  . 
GG-  8 
GG- 
GG- 
GG- 
GG- 
GG- 
GG- 
Wage  Board 
TOTAL 
NUMBER 
AVERAGE  GRADE 
End  FY80 
End  FY79 
End  FY78 
End  FY77 
End  FY76 
10.36 
10.32 
10.42 
10.42 
10. 40 
*does  not  include  contractor  personnel 
ia<wc4
V^:s^^y:  **•••» 
NSA/CSS  FY1981  MANPOWER  ALLOCATIONS 
Organization 
Director  and  Staff 
IG 
GC 
ADIL 
DDA/TDNCS 
DDPR 
DDPP 
DDO 
DDR 
DDC 
DDT 
Cryptologic  Career  Development 
TOTAL  HQ 
FIELD 
TOTAL  NSA/CSS 
Civilian 
Auth    Asgd 
Military 
Auth    Asgd 
Total 
Auth   Asgd 
/'*r';^r'r!;"r,'''-^?,v-  3  *  V "!
PROGRAMS  AND  BUDGET 
Introduction 
As  of  5  December  1980  the  defense  appropriations  measure  affecting  the 
three  NSA-related  programs  had  technically  completed  House-Senate  conference 
action  and  was  awaiting  Senate  floor  action.  House  floor  action  will  also 
be  required  should  the  Senate  approve  the  conference  agreement. 
The  following  is  a  summary  description  of  the  three  NSA-related  programs 
and  is  accompanied  by  a  summary  budget  chart  for  FY  1981,  as  of  24  November, 
as  NSA  is  specifically  affected.  . 
The  figures  in  the  FY  1981  Budget  summary  do  not  reflect  final  Congressional 
action  on  appropriation  requests  or  the  impact  of  pay  supplemental  decisions. 
■eOMrlPCCTAL   -
I.   Signals  Intelligence 
A.   Consolidated  Cryptologic  Program 
The  Director,  NSA  is  responsible  for  the  management  and  operational 
control  of  the  worldwide  U.S.  signals  intelligence  effort.  A  majority  of 
that  effort  is  funded  in  the  Consolidated  Cryptologic  Program  (CCP)  for  which 
the  Director_is  Program  Manager.  Certain  resource  requirements  ^H 
  pother  specialized  Defense  activities  also  contribute 
to  the  SIGINT  mission  and  are  funded  separately. 
The  FY  1981  budget  supporting  the  total  Consolidated  Cryptologic 
Program  was  originally  submitted  at  a  total  of4|  BtfSee  CCP  chirt. 
for  target  breakdown) .  This  budget  was  the  fina^produc^^Ri  process  which 
began  with  a  comprehensive  program  review  conducted  centrally  at  NSA  and 
involvingthecryp^logic  components  of  the  military  departments! 
^  Pfand  other  concerned  agencies.  After  approval_j>f . 
program  by  the  Secretary  of  Defense  and* 
  
a  Zero  Base  Budget  was  formulated  by  NSA  and  each  department^^^HHHp  These 
component  budgets  were  then  combined  and  ranked  as  a  total  consolidated 
cryptologic  budget  for  final  decision  by  the  DCI  and  the  President. 
The  NSA  share  of  the  CCP  is 
B.   Tactical  Cryptologic  Program 
as  of  24  November. 
The  Tactical  Cryptologic  Program  (TCP)  consists  of  those  resources 
and  activities  of  the  three  Military  Departments  and  the  National  Security 
Agency  engaged  in  tactical  signals  intelligence  activities  in  support  of 
tactical  commanders.  The  Tactical  Cryptologic  Program  is  a  major  functional 
program  within  the  Intelligence  Related  Activities  Aggregation  of  the  Defense 
Budget.  The  TCP  was  established  in  1979  to  correct  the  problem  of  disparate 
requirements  competing  for  limited  available  funding  within  the  National 
Foreign  Intelligence  Program  which  resulted  in  inadequate  treatment  of 
Service  tactical  support  needs. 
The  mechanism  proposed  by  the  Secretary  of  Defense  and  approved 
by  the  Executive  Branch  establishes  the  Tactical  Cryptologic  Program  with  the 
Director,  NSA  as  Program  Manager.   The  creation  of  this  program  aggregation 
is  in  consonance  with  Congressional  direction  with  respect  to  the  unitary 
review  and  control  of  all  signals  intelligence  activities  by  the  Director, 
NSA. 
Program  decisions  by  the  Secretary  of  Defense  form  the  basis  for 
TCP  budget  development.  The  military  services  coordinate  their  individual 
budget  development  with  the  Director,  NSA. 
The  FY  1981  TCP  was  justified  at 
s  the  NSA  share. 
of  which
II.  Communications  Security  Resources  Program 
The  Director,  NSA,  executes  the  responsibilities  of  the  Secretary  of 
Defense  as  Executive  Agent  for  the  Communications  Security  (COMSEC)  of  the 
United  States  Government.  That  effort  is  funded  in  the  Communications 
Security  Resources  Program  which  encompasses  the  budget  requirements "of  the 
military  departments,  the  National  Security  Agency,  and  the  Defense  Intelligence 
Agency. 
ye   COMSEC  budget  for  FY  1981  was  justified  by  the  Secretary  of  Defense 
[allocated  to  NSA. 
-eONriOENTiAi
FY  1981  BUDGET  ($  In  millions) 
CCP 
Military  Pay 
m 
Operations  and  Maintenance 
Procurement 
RDT&E 
Military  Construction 
TOTALS 
TCP 
Military  Pay 
Operations  and  Maintenance 
Investment 
RDT&E 
TOTALS 
CRP 
Military  Pay 
Operations  and  Maintenance 
Procurement 
RDT&E 
Military  Construction 
TOTALS 
M  »'  ■.'  *
COMMUNICATIONS  SECURITY 
The  COMSEC  mission  of  NSA  is  a  vital  element  of  national  security 
and  the  implementation  of  national  security  policy.  Its  scope  is  vast  and 
our  involvement  with  our  customers  is  close  and  continuing.  The  exploding 
technology  and  the  rapid  expansion  of  information  processing  and  transmission 
is  correspondingly  expanding  the  volume  and  type  of  COMSEC  solutions  and 
applications  required.  Th^challeng^andresnonsibility  is  immense  in  view 
of  the  absolute  necessity  M  ii achieve  and,  maintain 
an  acceptable  COMSEC  posturel  ■ 
jf|    ££|        0pand  other  national  securityrelatea  communications. 
The  fundamental  role  of  U.S.  Communications  Security  (COMSEC)  is 
to  deny  to  the  enemy  the  ability  to  derive  from  U.S.  classified  and  unclas- 
sified communications  information  detrimental  to  our  national  security  and  his 
ability  to  decrypt  these  communications.  The  Secretary  of  Defense  is  the 
Executive  Agent  of  the  Government  for  .Communications  Security.  NSA  is  the 
principal  arm  of  the  Executive  Agent  in  carrying  out  of  the  COMSEC  mission. 
The  COMSEC  mission  is  extremely  complex  and  multi-faceted  in  scope. 
1.  Our  users  run  the  gamut  from  the  President  to  infantry  maneuver 
units  with  the  entire  wide  range  of  sensitivities  and  applications  involved. 
Although  a  Defense  Agency,  NSA's  responsibility  for  providing  COMSEC  for 
national  security  information  is  Government-wide. 
2. .COMSEC  applications  range  from  protection  of 
to  providing  authentication  for< 
3.  COMSEC  needs  must  be  met  for  a  wide  variety  of  communications- 
electronics  categories  including  voice,  teletype,  data,  telemetry,  TV, 
facsimile,  and  computers/ADP. 
4.  The  COMSEC  responsibility  of  NSA  embraces  the  full  cycle  from 
enemy  threat  analysis,  vulnerability  assessment,  cryptologic  research, 
development  of  COMSEC  equipment  and  codes,  their  consolidated  production  for; 
the  entire  Government,  providing  the  doctrine  for  their  secure  use,  life-time 
provision  of  parts  and  cryptologic  materials,  working  with  the  users  to  apply 
them  effectively  and  efficiently,  and  throughout  the  entire  process  continually 
assessing  their  security.
6.  To  provide  a  cohesive  basis  for  such  a  vast  scope,  as  the 
principal  working  elements  of  the  Government  for  COMSEC,  NSA  develops  policy, 
objectives,  and  plans  for  review  and  promulgation  by  the  National  Communications 
Security  Committee.  As  the  COMSEC  Program  Manager  for  DoD,  NSA  also  has  the 
responsibility  for  assuring  an  optimal  program  balancing  current  and  projected 
needs. 
7.  Added  to  these  functions  is  the  lead  role  NSA  must  play  It 
issurin 
Our  COMSEC  must  be  ._effectiye_ against  the  enemy's  signal  intelligence 
(SICINT^__etfort,     ■*---»   •  ^-«-' 
In  recognition  of  the  threat  to  U.S.  communications  and  in  consonance 
with  the  national  policy  expressed  in  Presidential  Directive/NSC-24, 
special  emphasis  is  being  placed  on  expansion  oi 
Attached  is  a  somewhat  more  detailed  description  of  these 
and  other  NSA  activities  that  are  relevant. 
Also  attached  are  brief  descriptions  of  the  National  Communication 
Security  Committee  (NCSC)^I  'UnSA  role  in  each  is 
identified.
ATTACHMENT  1  TO  COMSEC 
•  A.  Voice 
Toduction.  The  need  for  aggressive 
equipment  designed   __   _    _ 
■  Bis  also  entering  initial. 
secure  voice  action  is  still  dominant  j    
and  continued  pressure  is  required  to  assure "that  the  Military  Services  anc 
important  civil  government  activities  continue  to  procure  the ■equipment  at  the^ 
rates  dictated  by  _the  NCSC  policy  on  secure  voice.  Achieving 
[meeting  DoD  f ixed-plr  it  requireroenj 
te  DoD  communicators  and  NS^ 
Ltive  control  over 
tt^onal  security  policy  that  NBA  ~has~ 
►  NSA  has  designed  and  produced 
COMSEC  "devices  for' 
future  impact  is  the 
will  require  a  very  heavy  expenditure  of  NSA  COMSEC  talent 
and  development  resources  to  provide  th"e  needed  security. 
C.  Record  and  Data.  Providing  COMSEC  for  record  and  data  communications 
is  another  important  effort.  We  are  currently  providing  new  equipments 
"The  explosion  in  data  and  ADP  communications  is 
changing  the  complexion  of  the  COMSEC  problem  since  it  is  beginning  to  assume 
a  significant  share  of  the  traffic  volume  as  compared  to  voice  communications, 
which  heretofore  was  overwhelmingly  predominant. 
  
From  virtually  the  start  ofl   
Be efT deeply  involved  in  providing  security 
prevent  enemy  manipulation  and  consequential  negation  of 
and  in  providing  security  for  J|  Hfll   Hfel 
    We  have  an  enviable  record  of  Successful  performance 
Currently,  we  are  providing HHB capabilities  for  the. 
in  this  field. 
E.   Computer  Security.   The  rapid,  almost  explosive  use 'of  computers 
and  their  rapidly  advancing  technology  has  provided  great  difficulties  in 
achieving  requisite  security  for  processing  classified  information.   NSA  has 
taken  the  lead  in  developing  techniques  for  "trusted"  computer  designs, 
cryptologics  for  protecting  information  in  the  systems,  authentication  schemes 
for  protecting  against  unauthorized  access  and  manipulation  and  a  host  of  other 
aspects.   The  problem  still  looms  large  and  it  is  growing. 
4mmm  ._- 
Attachment  1
H.  Technology.  The  successful  fulfillment  of  our  COMSEC  mission  requires 
us  to  be  at  the  forefront  of  the  communications-electronics  technology  world 
ag.well  being  the  experts  in  the  field  of  cryptolpgy.  We  are  currently__giving 
'communications^      m security  as  well1 
I.   Secure 
Taking  the  lead  in  COMSEC 
resource  consuming  activity,,  but  one  which  can  be 
COMSEC* 
NSA  has 
COMSE^aDDrcach  for  providing  the  riecessar 
■^  without         impact 
proposal  has  recently  been  adopted  as  ri! 
implementation  planning  stage. 
This 
"policy  and- is  in  the  active 
J.   Protection  of  Commercial/Private  Sector  Communications. 
_  Presidential  Directive  25"  "has  assxgned  the  focal 
point  for  protecting  non-national  security  information  to  the  National  Tele- 
communications and  Information  Agency  (NTIA)  of  the  Department  of  Commerce. 
NSA  and  NTIA  coordinate  closely  in  view  of  the  close  relationship  of  our  missions, 
with  NSA  continuing  to  provide  the  lead  for  cryptologic  development  and  techniques.
— «  <■■»' . 
K.  COMSEC  Assessment.  A  considerable  emphasis  in  our  current  actions  is 
the  development  of  capabilities  to  assess  oar  COMSEC  posture.  As  systems  and 
applications  become  more  and  more  complex,  it  is  increasingly  possible  for  a 
combination  of  systems  and  use  factors  to  impact  the  security  provided  by 
COMSEC  equipment.  To  counter  such  conditions,  it  is  becoming  increasingly 
importances!    IHMMISFassess  tne  degree  of  COMSEC  being  achieved  in  use. 
Modern  quantitative  analysis  techniques  are  being  utilized* 
L.  COMSEC  Material  Production.  The  production  of  codes  and_  COM.SE( 
equipment  for  the  entire  Federal  Government] 
i  requires  a  great  amount  of  talenTTand  resources  ^Jyjf  is  one  .in 
-VfT  "*  ■»  **%*v  VC*^^** 
jdjich  we  have  an  excellent  record  of  performance.  We  produce^ 
iJJBmS     m&iJ0^   codes  and  key  setting  for  equipments  which  are  distributed 
worldwide  on  a  priority  basJLs,  by^thgi  military  system.  Last  fiscal  year,  we 
administered  contracts^         F*j  equipments,  ancillary  units  and  parts^, 
Singled-out  for  exceptional  note  by  OMB  was  the  savings  on  the  pr.oduction.i 
equipment  over  a  three  year  period  (78/80) 
_due  to  NSA  procurement  strategies.   In  addition,  in  FY  80  Wj 
consolidating  the  Services'  requirements  for  production 
by  rehabilitating  and  redistributing  excess  CO>lSEC~equipraent. 
M.   COMSEC  Manpower.   The  key  ingredient  to  NSA's  fulfillment  of  its 
complex  COMSEC  mission  is  its  well  qualified  and  highly  motivated  workforce. 
There  is  no  source  outside  of  NSA  for  acquiring  qualified  COMSEC  professionals, 
and  at  a  time  of  rapidly  expanding  demands  on  the  COMSEC  mission  it  is  becoming 
increasingly  difficult  to  attract  the  manpower  with  the  potential  for  becoming 
COMSEC  professionals.   This  is  a  roblem  for  the  immediate  and  longer  range 
future  that  could  have  a  significant  impact  if  solutions  are  not  found.
ATTACHMENT  2 
NATIONAL  COMMUNICATIONS  SECURITY  COMMITTEE 
(U)  Tha  body  that  is  now  known  as  the  National  Communications  Security 
Committee  (NCSC)  was  established  by  a  Presidential  Directive  in  October  1952, 
at  which  time  it  was  designated  the  United  States  Communications  Security 
Board  (USCSB) .  NSA  provides  the  Executive  Secretary  to  this  committee. 
tO}  With  the  approval  of  the  National  Communications  Security  Directive 
of  June  1979,  the  USCSB  was  renamed  the  National  Communications  Security 
Committee  (NCSC)  with  a  representative  of  the  Secretary  of  Defense  as  Chairman 
and  composed  of  representatives  designated  by  State,  Treasury,  the  Attorney 
General,  the  Secretary  of  Transportation,  the  Secretary  of  Energy,  the    \ 
Secretaries  of  the  Army,  Navy,  and  Air  Force,  the  Director  of  Central  Intelligence, 
and  the  Director,  National  Security  Agency./  The  Directive  further  stated  that 
representatives  of  Commerce,  the  Joint »Chiefs  of  Staff,  General  Services 
Administration,  Federal  Communications  Commission,  the  Manager  of  the  National 
Communications  System,  Defense  Communications  Agency,  Defense  Intelligence 
Agency,  Defense  Logistics  Agency,  and  the  Federal  Emergency  Management 
Agency  may  participate  as  observers  in  all  aspects  of  the  Committee's  work. 
*tC^  The  Committee  was  made  responsible  for  developing  for  approval  by 
the  Secretary  of  Defense  broad  communications  security  objectives,  policies 
and  implementation  procedures;  providing  guidance  and  assistance  to  the 
departments  and  agencies  of  the  Federal  Government  in  their  communications 
security  activities;  conducting  an  annual  review  of  the  status  and  objectives 
of  the  communications  security  activities  of  the  departments  and  agencies 
and  making  recommendations  concerning  those  activities  to  the  Secretary 
of  Defense; providing  communications  security  guidance  to  departments  and 
agencies^'  "   ~" 
mo  considering  and  discussing  issues  of  communications 
security  referred  to  it  by  any  department  or  agency  and  making  recommendations 
to  the  Secretary  of  Defense  with  respect  thereto,  if  appropriate. 
"t^-  On  July  10,  1979,  the  Executive  Agent  for  COMSEC,  the  Secretary  of 
Defense,  delegated  authority  to  the  NCSC  for  the  oversight  of  policy  implementation 
offl  MHHNRHM  IHMMMi      ■ 
and   the  access  of  U.S.    contractors   to  classified  Federal  telecommunications- or 
COMSEC  material. 
t^The,  NSA_j:0MSEC  organization'  conducts  the  operation  of" 
communications  security  and  evaluation  agency 
^communications  security  material  distribution  and  accounting 
completely 
{functions  are  largely  in  the" evaluation  and 
areas »   and  essentiall^B  ^LNSA  COMSEC  functions ^ 
[functions  are   to  arrange   for   the  production  and  distribution 
  
keying  material  and  COMSEC  publications,    and  to  establish 
Procedures  f°r  adequately  handling  and  accounting  for   these  materials. 
Jed  authority  and   feedback^ 
>roperly  used  and  protected. 
provide   insurance  U  ■cryptography  used   is   adequate 
protects  ■*ini 
Attachment    2 
-r-i  .r*  ^.  .
SUMMARY  OF  LEGISLATIVE  INITIATIVES 
OF  THE  NATIONAL  SECURITY  AGENCY 
Legislative  Proposals  Currently  Pending  Before  the  96th  Congress: 
Senior  Cryptologic  Executive  Service  Act  of  19S0  (S.2116  and  H.R. 
5865):   This  bill  would  provide  legislative  authority  to  the  Secretary  of  Defense 
or  his  designee  to  establish  a  Senior  Cryptologic  Executive  Service  within  the 
National  Security  Agency.   The  NSA  was  exempted  from  the  Senior  Executive  Service 
and  merit  pay  portions  of  the  Civil  Service  Reform  Act  of  1973  because  of  NSA's 
unique  functions  and  structure  as  well  as  security  concerns.   The  bill  would 
enable  the  Director,  NSA,  to  establish  the  SCES  within  required  security  constraints 
and  to  establish  a  merit  pay  system  appropriate  to  the  NSA's  needs*.   Hearings  on 
S.2116  were  held  by  the  Senate  Governmental  Affairs  Committee  and  an  amended-  bill 
was  reported  out  by  the  Committee  with  a  recommendation  that  the  Senate  act  favorably 
on  the  bill.   The  House  has  not  held  .hearings  on  its  version  of  the  bill  which  has 
been  referred  to  the  House  Permanent  Select  .Committee  on  Intelligence. 
New  NSA  Legislative  Proposals  for*  the  97th  Congress: 
a.  NSA  has  four  legislative  proposals  that  have  been  submitted  to  DoD  to 
obtain  DoD  and  OMB  clearance  for  submission  to  the  97th  Congress.   These  are: 
(1)  Cryptologic  Equipment  Fund:   This  proposal  is  one  to  amend  title 
31,  U.S.C.,  to  add  a  new  section  to  authorize  the  extension  of  the  period  of 
availability  for  expenditure  of  appropriations  when  used  under  certain  conditions 
for  the  purchase  of  cryptologic  equipment.   This  proposal  is  designed  to  resolve  a 
conflict  in  General  Accounting  Office  opinions  concerning  the  conditions  under 
which  funds  from  other  agencies  become  obligated  for  the  purposes  of  title  31, 
U.S.C. 
(2)  Cryptologic  Grant  Program:   This  proposal  permits  continuation  of 
a  program  providing  grants  for  cryptologic  research.   The  program  was  initiated  by 
NSA  with  the  approval  of  DoD  and  in  accordance  with  Congressional  guidance. 
(3)  Protection  from  Liability  for  Psychologists:   This  proposal  would 
amend  section  1089  of  title  10,  U.S.C,  to  add  to  the  categories  of  those  already 
afforded  malpractice  protection  the  categories  of  psychologist,  psychometrician, 
and  psychological  technician.   This  proposal  is  necessary  to  provide  the  requisite 
protection  from  potential  liability  to  assure  full  and  complete  advice  needed  for 
personnel  security  adjudications  and  proper  security  protection. 
( A )   Transportation  of  the  Remains  of  Deceased  Employees,  Dependents 
and  Household  Goods:   This  proposal  would  amend  title  10  to  authorize  the  payment 
of  the  costs  of  transporting  the  remains  of  a  deceased  employee,  the  dependents  of 
such  an  employee,  and  thf>  household  goods  of  that  employee  from  a  post  within  the 
United  States  to  the  place  of  pernanent  residence  of  such  an  employee.  . 
b.  NSA  also  intends  to  submit  to  Del)  and  OMB  a  legislative  proposal  to 
authorize  establish  a  graduate  studies  program  for  certain  critical  skills  personnel 
for  which  shortages  currently  exist.
New  Intelligence  Community  Proposals  for  the  97th  Congress: 
NSA  would  support  Intelligence  Community  Charter  legislation  provided  it 
incorporated  an  acceptable  charter  for  NSA  to  include  enumeration  of  functional 
responsibilities  and  needed  administrative  authorities.   In  addition,  the  Charter 
legislation  should  include  certain  needed  technical  amendments  to  the  Foreign 
Intelligence  Surveillance  Act  of  1978.
•■  SfcUKLr 
E.O.    12036 
Relative  to  the  Budget  Process 
(U)  Executive  Order  12036,  which  fonts  the  basis  for  the  conduct  of  U.S. 
intelligence  activities,  has  serious  shortcomings  and  needs  to  be  carefully 
reviewed. 
*&^ Principal  among  the  problems  inherent  in  this  document  are  those  associated 
with  the  intelligence  budget  process.   Specifically,  the  Executive  order  assigns 
to  the  DCI  the  authority  to  make  resource  recommendations  to  the  President 
for  the  entire  National  Foreign  Intelligence  Program  (NF1P) ,  though  approximately 
PJjfcintelligence  assets  belong  to  DoD.  Through  this  process  thesignals       • 
intelligence  budget  alone  in  the  three  years  ^hrough  FY-81 
'The  budget  approach  has  tended  to  concentrate  on  what  we  can  do., 
rather  than  on  what  the  real  intelligence  needs  of  the  country  are.  The "result 
is  an  intelligence  structure  -  particularly  that  related  to  signals  intelligence  - 
Relative  to  Requirements  and  Tasking 
i Subsequent  to  publication  of  E.O.  12036,  the  intelligence  requirements 
process ^0NM|   HMI  Mtt  Under  the  0rder»  th"  PRC(I)  was  assigned  the  role  to 
"establish  requirementsana  priorities  for  national  foreign  intelligence'^and^ 
to  "evaluate  the  quality  of  _  the  intelligence  product."  jtfMRMRMMl BH      BU 
~~~        '        In  addition,  the  DCI's  staff  has  been^|  £ 
^TrTlinking^National  Intelligence  Topics  (NITs)  developea. 
by  the  PRC(I)  to  the  NFIB,  i.e.,  approved  requirements  process  as  outlined  in 
DC1D  1/2.  Attempts  to  prioritize -intelligence  needs  and  to  evaluate  requir^ements 
satisfaction  have  been  made  and  continue  to  be  worked  or 
Vr*  ra  /!";.  «  F-"r
CIEHrftKl 
(U)  The  National  Intelligence  Tasking  Center  has  never  really  taken  shape 
as  described,  and  thus  its  impact  has  been  of  little  consequence  apart  from 
the  education  which  took  place  over  four  years  of  evaluation.   The  "collection 
plans"  involve  Community  elements  in  much  paperwork  for  little,  if  any, 
tangible  return. 
Relative  to  Restrictions 
(U)The  following  are  some  of  the  provisions  of  the  Order  that  have  produced 
unintended  or  burdensome  results..  Their  amendment  would  ease  compliance 
with  the  order  while  not  diminishing  protections  afforded  U.S.  persons. 
a.   Section  2-202:   This  section  includes,  inter  alia,  a  requirement 
that  testing  and  training  of  electronic  communications  equipment  be  subject 
to  procedures.   This  is  an  unnecessary  restriction.   Intelligence  agency 
communications  devices  and  communicators  should  be  treated  no  differently 
than  their  counterparts  outside  the  intelligence  community.   This  restriction 
should  be  modified  to  apply  only  to  electronic  surveillance  equipment.   In
addition,  the  provision  that  limits  the  use  of  data  acquired  during  testing 
and  training  to  those  purposes  only  should  be  modified  to  permit  otherwise 
lawful  retention  or  use  if  the  testing  or  training  is  conducted  against  signals 
that  could  be  lawfully  intercepted  for  intelligence  purposes.  There  appears 
to  be  no  sound  reason  to  deprive  the  government  of  foreign  intelligence 
information  because  it  was  acquired  during  testing  or  training  rather  than 
during  routine  operations. 
b.  Section  2-208;  A  new  subsection  is  needed  that  would  permit 
the  collection  of  information  on  U.S.  persons  abroad  when  their  physical 
safety  is  threatened  and  it  is  impossible  to  obtain  their  consent,  e.g., 
hostages,  POW's,  or  refugees.  No  single  provision  in  2-208  clearly  permits 
such  collection.  Subsection  2-208(i)  is  not  sufficiently  broad.  *  It  raises 
legal  questions  concerning  the  scope  of  the  Department  of  State's  consular, 
responsibilities  particularly  if  the  U.S.  persons  are  in  a  country  with 
which  the  U.S.  has  no  diplomatic  relations  or  are  on  the  high  seas  or  in 
international  airspace. 
c.  Section  2-203:  This  section  only  permits  concealment 
of  contracts  with  non-academic  institutions  when  "necessary  to  maintain 
essential  cover  on  proprietary  arrangements."   It  does  not  permit  concealment 
in  circumstances  where  a  particular  contract  or  an  aggregate  of  contracts 
would  disclose  classified  capabilities  or  the  specific  targets  of  an 
intelligence  agency.  This  section  should  be  modified  to  permit  concealment 
in  such  circumstances.
\yiin..Wi *  'te  < 
NSA  MODERNIZATION  OBJECTIVES 
4  .  ,"jNP^?St  haS  been'  and  continues  to  be  faced  with  the  need  to  produce 
intelligence  information  from  a  signals  environment  that  is  characterized  by 
greatly  increasing  volumes  and  complexity  of  available  communications,  and  to 
JJL^l^J^^L^l^i^   a  Pr°6r"iin  t^odernizeTn-sit^q^iproe^ 
continue,  to  pursue  acquisition  of 
processing  systems  wjth^T 
to  meet  the  challenges  ot  the  future? 
^The  U.S.  SIGINT  System,  however,  must 
f  and 
(capabilities  if  we  are 
<S^^  To  meet  these  challenges,  the  following  objectives  comprise  our 
strategy  for  t<he  future: 
Collection  and  Processing  Equipment:  ^^^^^^^^^^^^^^^^^^^ 
to  maintain  pace  with  in-being  communications  and  cond~u£rTeTS!3Taimed 
at  handling  developing  and  anticipated  technologies. 
— :  y»   a  .- — •—
NSA  RELATIONSHIP  WITH  EASD(I) 
1*8^  The  relationship  between  NSA  and  the  DASD(I)  has  been  quite  satisfactory 
and  beneficial  in  those  intelligence  programs  under  the  control  of  the  Secretary 
of  Defense.  The  establishment  of  the  Tactical  Cryptologic  Program  (TCP)  beginning 
in  Fiscal  1981  was  a  major  accomplishment  which  the  DASD(I)  supported.  The 
JDASD(I)  also  played  a  major  role  in  the  creation  of  the 
['•which  is  being  implemented-  in  the  FY  1982  budget. 
(U)  The  effectiveness  of  the  DASD(I)  in  Programs  and  Budgets  under  the  purview 
of  the  DCI  has  been  limited.   The  implementation  of  Executive  Order  12036 
which  vested  "full  and  exclusive"  authority  in  the  DCI  for  Intelligence  Programs 
and  Budgets  within  the  NFIP  served  to  neutralize  the  DASD(I)  role  in  the  CCP. 
The  DASD(I)  has  supported  NSA  in  the  NFIP  arena  but  most  such  efforts  have 
proven  fruitless.   The  most  significant  contribution  made  by  the  DASD(I)  inMealing 
with  the  NFIP  has  been  in  furnishing  technical  and  management  support  to  the 
Secretary  for  his  meetings  with  the  DCI,  0MB.'and  the  President. 
> 
(U)  Restoring  an  OSD  structure  that  can  more  effectively  deal  with  non-DoD 
aspects  of  intelligence  oversight/management  is  urgently  needed.   The  DIRNSA 
believes  that  the  creation  of  an  Assistant  Secretary  of  Defense  (Intelligence) 
(civilian)  or  Director  of  Defense  Intelligence  (military  with  Assistant  Secretary 
status)  should  be  a  high  priority  goal  in  the  incoming  administration. 
-r 
/"».  \  i  r—  j  »~»  — —  r  ■  *-»-- 
^.  _ 
>  ■  ■>  '3-
TEN-YEAR  FACILITIES  PLAN 
ISSUE:   To  obtain  the  required,  properly  configured,  permanent  facilities 
to  house  the  computer-based  systems  and  analysts  employed  in  the  Signals 
Intelligence  mission. 
EXISTING  SITUATION: 
—  NSA  Operations  initially  moved  to  Ft.  Meade  in  1957.. 
—  Now  occupy  4.6  million  sq  ft  at  Ft.  Meade  and  Friendship  Airport, 
and  environs: 
3.3  million  SF  in  permanent  facilities  \ 
.4  million  SF  in  temporary  Government  buildings 
,9  million  SF  in  leased  commercial  facilities 
i 
THE  PROBLEM: 
—  We  have  recently  undergone  a  comprehensive  realignment  to  obtain  the 
greatest  efficiencies  from  existing  facilities  and  to  compress  analyst  space 
to  a  bare  minimum  (45  SF  per  person,  vice  DoD  standard  of  80  SF) . 
—  A  10-Year  Facilities  Plan  validates  the  need  for  1.3  million  SF 
of  net  useable  space  between  now  and  1990: 
—   376,030  SF  to  accommodate  program  needs  through  FY  1935 
300,000  SF  to  decompress  analyst  work  areas 
600,000  SF  to  replace  leased  commercial  facilities     •  -     '. 
—  Surveyed  over  100  available  U.S.  Government  facilities,  but  found 
none  suitable. 
—  Temporary  measures  (particularly  leasing)  are  unsatisfactory  for  the 
long-run  and  very  expensive  (row  spending  in  excess  of  $8  million  in  annual 
recurring  costs  associated  with  use  of  leased  facilities). 
THE  SOLUTION; 
In  the  near-term,  to  house  programmed  systems  additions  through 
FY  1985  and  achieve  some  decompression,  the  construction  of  a  960,000  SF 
facility  (676,000  SF  assignable)  has  been  proposed  in  the  FY  1982  budget. 
Several  options  were  examined:
—  Two  separate  projects,  in  FY  1982  and  FY  1985  (total  cost  = 
$141  million) 
—  A  two-year,  sequentially  funded  project,  FY  1982/83  (total  cost 
$131.3  million) 
—  A  single  project,  FY  1982  (total  cost  =  $121.7  million) 
—  Strongly  urge  inclusion  of  $121.7  million  in  FY  1982  budget  for 
a  single-year  project. 
—  Dependent  on  sufficient  funds  from  Sec  Def  to  complete  planning 
and  design  phases:  ,' 
—  $3  million  in  FY  1981 
—  $1.9  million  in  FY  1982*
FY81  HIRING  REQUIREMENTS 
INFORMATION  SCIENCE 
SPECIAL  RESEARCH 
LINGUIST 
CRYPTANALYSIS 
TRAFFIC  ANALYSIS 
SIGNALS  ANALYSIS 
SIGNALS  COLLECTION 
SIGNALS  PROTECTION 
MATHEMATICS 
ENGINEERING 
PHYSICAL  SCIENCE  , 
COMPUTER  SYSTEMS  * 
TELECOMMUNICATIONS 
LEGAL       *       * 
SYSTEMS  MANAGEMENT 
SECURITY 
RESOURCES  MANAGEMENT 
INDUSTRIAL  PRODUCTION 
LOGISTICS 
ADMINISTRATION  &  SUPPORT 
CRYPTOLOGIC  OPERATIONS  OFFICER 
SYSTEMS  SCIENTIST 
TOTAL
V"»   ..,1  .;,   i,   t.  U,«,  »__ 
HIRING  LIMITATIONS/FREEZE  AND  IMPACT 
1.  00  There  is  grave  concern  that  the  limitation  on  civilian  hiring  will 
soon  seriously  jeopardize  our  ability  to  fulfill  critical  mission  requirements 
if  action  is  not  taken  to  relieve  these  constraints.  The  current  limitation 
on  civilian  hiring  permits  the  appointment  of  only  one  person  for  every  two 
vacancies  which  occur  after  29  February  1980.  -The  limitation  not  only  restricts 
the  filling  of  vacancies  occurring  this  year  from  our  already  eroded  manpower 
strength  but  also  precludes  the  acquisition  of  needed  personnel  for  important 
initiatives  which  have  already  been  approved  by  Congress.  These  initiatives 
include  programs  of  major  concern  to  national  decision  makers.   We  also  had 
additional  billets  authorized  which  would  permit  us  to  carry  out  Executive 
Branch  and  Congressional  directions  for  improving  the  management  pf  tactical 
cryptologic  efforts.  The  hiring  limitation  negates  our  ability  to  move  ahead 
on  "these  programs  and  seriously  impairs  our  ability  to  staff  other  programs  in 
areas  critical  to  the  security  of  U.S.  communications  and  the  production 
of  signals  intelligence.  * 
2.  • ' ($■)-  The  potential  impact  of  a  total  hiring  freeze  on  KSA  operations  is 
incalculable.  Assuming  a  total  hiring  freeze,  we  estimate  that  more  than 
MMJauthorized  civilian  positions  would  be  vacant  by  the  end  of  FY81.   This 
problem  is  further  compounded  by  the  exceedingly  long  lead  times  required  to 
process,  clear,  and  appoint  civilian  employees  to  this  Agency;  particularly 
during  a  time  when  competition  for  critical  skills  places  the  federal  government 
at  a  serious  disadvantage. 
3.  "  '(3-)- Without  adequate  staffing,  particularly  of  positions  requiring 
people  with  critical  skills,  it  is  difficult  to  maintain  existing  operating 
systems,  much  less  provide  for  the  development  of  new  systems  and  software 
needed  to  support_our  tl  B  While  we  are  . continuing 
to  upgrade  our  ^^        ^  
..___.     „_          
II      iNl^^  effort  will  require  additional 
engineers,  analysts,  data  systems  specialists,  cryptomathematicians,  signals 
processors  and  support  technicians. 
4.   (G)  The  acquisition  of 
need  for  NSA.   Workloads  and  diverse 
P" 
trained  and  competent,  is  a  najor 
iorities  resulting  from! 
combine  to  create  an  ever  increasing  shortfall  between  essential 
jrocessing  requirements  and  the  available,  trained_^B^MBworkforce, 
Despite  the  fact  that  the  Agency  is  the  largest  employer  o(|    RPPHT1" 
the  Intelligence  Community,  a  significant  increase  in  authorized  manning  will 
he  necessary  to  effectively  respond  to  customer  requirements. 
5.   (U)  The  following  chart  depicts  the  numbers  and  skill  distribution  of 
our  hiring  requirements  for  FY  1981  as  represented  by  authorized  vacancies  and 
projected  losses  through  attrition.   The  shortfall  in  the  above  described 
critical  skills  is  readily  apparent. 
?*h*c 
^.i?l>sNt •'*'.'  f-  ■■■■  -
FREEDOM  OF  INFORMATION  ACT 
The  primary  problem  created  for  the  National  Security  Agency  (NSA)  by  the 
Freedom  of  Information  Act  as  amended,  (FOIA)  is  the  danger  of  disclosure  of 
information  and  of  sources  and  methods  that  are  uniquely  fragile  and  sensitive. 
Experience  indicates  that  this  may  occur  through  .partial  or  full  disclosures 
ordered  by  a  court,  through  inadvertant  disclosures,  either  by  mistake,  by  over- 
zealous  administration,  by  exigencies  of  litigation,  or  by  court  review.   To  a 
lesser  degree,  inappropriate  disclosure  may  also  occur  through  violation  of  tradi- 
tional need-to-know  principles  during  the  search  and  review  process,  or  through 
judicial  failures  to  safeguard  information  presented  to  the  court.   This  is  in 
addition  to  the  cost  of  processing  FOIA  requests,  searching  necessary  records,  and 
participating  in  litigation.  '       t  ' 
NSA  possesses  some  useful  protection  in-  the  form  of  statutes  requiring  protec- 
tion of  cryptologic  information,  which  .have 'been  identified  by  the  Congress  and 
interpreted  by  some  courts  as  constituting  exemption  to  the  FOIA.   Such  an  inter- 
pretation has  not  been  made  by  all  courts,  however,  and  the  exemption  is  under 
continuous  and  systematic  attack  by  groups  seeking  access  to  NSA's  records.   In 
addition,  this  protection  has  been  eroded  by  judicial  action. 
The  courts  are  currently  considering  a  number  of  FOIA  cases  involving  NSA 
information  in  which  the  result  could  be'  to  further  erode  existing  protection  of 
sensitive  cryptologic  information  through  the  following  actions: 
a.  applying  a  full  Vaughan  v.  Rosen  indexing  requirements  to  cryptologic 
records ; 
b.  ignoring  b.(3)  exemption  standards  and  accompanying  legislative 
history  (permitting  reliance  on  affidavits  vice  de  novo  review  and  examination  of 
classified  records)  and  substituting  b.(l)  exemption  standards  (requiring  de  novo 
review  and  examination  of  records); 
c   attempting  to  limit  the  b.(3)  exemption  to  classified  information 
only,  although  section  6  of  the  National  Security  Agency  Act  clearly  extends 
statutory  protection  beyond  classified  information;  .  „ 
d.   attempting  to  impose  administratively  mandated  tests  such  as  those 
contained  in  various  sections  of  Executive  Order  12065,  National  Security  Information, 
especially  section  3-303  dealing  with  the  so-called  public  interest  balancing  test. 
Legislative  action  is  required  to  reinforce  and  ensure  continuation  of  existing 
protection.   A  broad  exemption  from  the  Act  for  intelligence  information  and 
records  would  be  the  most  effective  way  to  accomplish  this  goal.   In  addition,  it 
would  be  useful  to  clarify  guidance  to  the  courts  as  to  Congressional  intent  to 
make  the  b.(3)  exemption  broader  and  clearer,  and  less  subject  to  judicial  interpre- 
tation and  nulif icat ion,  and  to  render  cryptologic  records  less  subject  to  judicial 
administrative  requirements  such  as  indexing.   While  a  broader,  separate  amendment 
to  FOIA  might  be  the  most  effective  way  of  dealing  with  these  issues,  they  can  also 
be  affected  through  a  series  of  narrow  technical  amendments  to  the  existing  Act.
Previous  Executive  Orders  relating  to  classification  have  also  had  an  impact 
on  the  ability  to  protect  sensitive  information  under  FOIA,  because  of  the  impact 
of  the  Order  on  determining  whether  particular  information  is  properly  classified 
and  therefore  is  exempted  from  disclosure.  Administrative  action  is  required  to 
amend  the  existing  Executive  Order  12065  to  more,  adequately  protect  cryptologic 
information.   This  could  be  accomplished  by  deleting  or  amending  provisions  contained 
in  sections  1-6,  3-3  and  3-505,  and  by  adding  one  or  more  new. sections  to  the 
Order,  to  restore  provisions  protecting  cryptologic  information  that  were  contained 
in  previous  executive  orders  on  classification  (e.g.,  sections  5. (B)(2)  and  9  of 
E.O.  11652).   It  would  also  be  useful  to  restore,  at  least  for  cryptologic  (and 
other  intelligence)  records,  the  concept  that  certain,  individually  unclassified     , 
information  may  reveal  sensitive  information  in  the  aggregate,  and  thus  should  be 
classified.   There  should  also  be  a  review  of  the  concepts  of  segregability  and 
portion- 
marking.  * 
Finally,  recognizing  both  the  personnel  and  security  costs  of  administering 
the  FOIA  program  in  intelligence  agencies,  an  effort  should  be  made  to  limit  the 
need  to  search  for  and  review  records  that  prima-facie  will  be  exempted,  indexing, 
the  requirement  to  segregate  out  and  release  information,  and  the  need  for  judicial 
reviev  and  to  substitute  administrative  certification.
IMPACT  OF  RECENT  LAWS  AND  COURT  DECISIONS  ON  PEi'ZQNNEL 
AND  PERSONNEL  SECURITY  HATTERS 
In  order  to  make  effective  decisions  regarding  employment  and  retention  of 
personnel  in  sensitive  positions  requiring  access  to  classified  cryptologic  informa= 
tion,  it  is  essential  that  there  be  available  fqr  consideration  all  pertinent 
information,  both  positive  and  negative,  concerning  individual  applicants,  employees 
or  assignees.   Timely  and  complete  access  to  such  information  has  been  inhibited  to 
a  limited  extent  by  several  recent  laws  including  the  Privacy  Act  of  1974,  and  the    ; 
Right  to  Financial  Privacy  Act  of  1978.   Presumably,  the  recently  enacted  Federal 
Privacy  of  Medical  Information  Act  of  1980  will  have  a  similar  effect.   Access  to 
certain  criminal  justice  records  has  been  limited  also  by  overly  strict  implementing 
by  the  states  of  the  LEAA  guidelines  on  disclosure  of  such  information.  These  laws 
tend  to  inhibit  access  to  information  because  (1)  individuals  fear  disclosure  of 
the  information  they  provide,  (2)  collectors  of  information  fear  sanctions  for 
inappropriate  collection  and  retention.,  and  (3)  collectors  of  information  fear 
sanctions  for  inappropriate  dissemination.  .In  addition,  the  laws  inhibit  retention 
and  use  of  such  information  because  they, impose  sanctions  on  inappropriate  retention 
and  use  of  information  in  certain  circumstances.   It  may  be  possible  to  remedy  some 
aspects  of  the  problem  by  revising  the  existing  complicated  implementing  regulations 
rather  than  attempting  to  change  the  laws.   It  would  also  be  useful  to  modify  the 
Privacy  Act  public  disclosure  requirement  concerning  systems  of  records  as  they 
pertain  to  persons  associated  with  an  intelligence  agency  to  limit  the  requirement 
for  publication  to  disclosure  to  persons  within  the  agency  only.   This  would  linit 
the  amount  of  exposure  of  sensitive  information  concerning  agency  operations 
without  affecting  the  underlying  goal  of  allowing  individuals  access  to  information 
concerning  them. 
The  most  immediate  and  difficult  problem  concerning  decisions  on  employment, 
assignment  and  retention  of  personnel  requiring  access  to  sensitive  cryptologic 
information  is  presented  by  the  court  decision  in  the  recent  case  of  Jane  Doe  vs. 
U.S.  Civil  Service  Commission,  the  settlement  of  that  case  by  the  0PM,  and  subsequent 
action  by  0?M  to  promulgate  regulations  based  on  that  decision.   This  case  and  its 
precipitous  settlement  by  0PM  before  appeal,  presents  the  serious  possibility  of 
personal  liability  to  individual  government  officials  for  disseminating  or  using 
derogatory  information  acquired  during  background  investigations.   Becau-se  of  such 
possible  liability,  there  has  arisen  the  likelihood  that  employment  or  access  will 
be  granted  without  the  benefit  of  full,  complete  background  information  on  an 
individual.   Because  of  the  decision  and  settlement  of  Doe,  it  has  been  necessary 
to  adopt  stringent  internal  procedures  limiting  dissemination  of  information  in 
order  to  protect  officials  involved  in  such  matters  from  possible  personal  liability. 
In  settling  Doe,  and  subsequently  issuing  draft  implementing  regulations,  0PM  has 
failed  to  adequately  distinguish  between  regular  Government  employment  and  employment 
involving  access  to  sensitive  intelligence  and  cryptologic  information.   In  the 
more  sensitive  positions,  consideration  of  all  background  information,  regardless 
of  the  source  or  content,  is  essential  to  assure  faulty  security  determinations  are 
not  made.   Although  there  is  has  been  an  effort  by  the  intelligence  community  to 
counter  the  0PM  initiative,  more  effective  action  is  required  to  avoid  establishment 
of  procedures  that  will  further  undercut  personnel  security.   Administrative 
action  may  not  be  adequate  since  the  case  is  grounded  on  a  constitutional  tort 
theory,  and  it  may  be  necessary  to  seek  legislative  relief  through  some  form  of 
protection  for  officials  in  intelligence  agencies  from  personal "liabi 1  icy .
ECONOMIC  CONSEQUENCES  OF  FIELD  ASSIGNMENTS 
1.  The  high  cost  of  living  worldwide  is  causing  considerable  hardship 
to  NSA's  Field  employees,  particularly  those  at  junior  grade  levels.  More- 
over, the  knowledge  of  these  hardships  has  permeated  the  Headquarters  work- 
force to  the  extent  that  it  is  becoming  increasingly  difficult  to  attract 
qualified  employees  for  these  vital  positions.  " 
2.  Additionally,  today's  real  estate  situation  adds  a  further  complication 
in  that  many  people  will  not  accept  a  Field  position  if  it  means  that  it  will 
cause  them  to  become  "long  distance  landlords."  Yet,  if  they  sell  their 
present  home,  they  know  that  the  same  favorable  interest  rate  they  are  paying 
on  their  mortgage  today,  will  be  considerably  accelerated  when  they  return 
from  their  Field  assignment.  * 
3.  Currently,  there  ^JHJ^positions. scheduled  to  become  vacant  in 
calendar  year  1981,  for  which  ho"  interest  has  been  expressed  from  within 
the  workforce.  Many  of  these  positions  involve  highly  technical  skills  that 
are  mission-essential  (engineers/  data  systems  analysts,  etc.).   If  the  Agency 
is  to  continue  to  successfully  man  Field  positions,  it  is  believed  that  more 
favorable  entitlements  and  higher  cost-of-living  allowance  will  have  to  be 
provided*.
SHORTAGE  OF  MIDDLE-LEVEL  MILITARY  CRYPTOLOGIC  TECHNICIANS 
1.  As  is  the  case  throughout  the  military  services,  the  impact  of  the 
declining  number  of  middle-level  non-commissioned  officers  and  petty  officers 
within  the  services  has  become  apparent  within  -this  Agency.  Within  the  U.S. 
SIGINT  system,  this  shortage  is  ot  concern  as  it  may  reduce  the  effectiveness 
of  the  system  in  fulfilling  its  mission.  A  recent  comparison  of  the  manning 
levels  for  military  enlisted  personnel  with  the  requirements  by  gnulo  levels 
within  this  Agency's  operational  requirements  shows  a  shortage  of MBfcpersonnel 
in  grades  E5  through  E7.   The  greatest  deficiency  is  at  grade  E5.^Tne  problem 
is  further  exacerbated  by  the  fact  that  a  sizable  portion  of  those  assigned  are 
recent  technical  school  graduates  without  field  experience.  This  situation 
generates  three  problems:   (1)  Many  technical  military  positions  are  currently 
unfilled  or  are  manned  by  less  qualified  junior  enlisted  personnel;  (2)  On-board, 
experienced,  technical  personnel  are  required  to  spend  more  time  in  training 
less  experienced  Junior  personnel;  and  (3)  An  increasing  number  of  Agency 
positions  must  be  filled  with  civilians f   when  available,  because  of  the  non- 
availability of  experienced  enlisted  personnel. 
2.  NSA  would  support  any  DoD  initiatives  to  provide  incentives  to  attract 
and  retain  these  -military  enlisted  personnel.
EXCESSSIVE  DELAYS  IN  COMPLETION  OF  SPECIAL  BACKGROUND 
INVESTIGATION'S  (SBIs)  CONDUCTED  FOR  NSA  BY  THE  DEFENSE 
INVESTIGATIVE  SERVICE  (PIS) 
1.  DIS  has  conducted  SBIs  on  most  of  the  Agency's  civilian  job  applicants 
.jind  Agency  contractor  employees  since  1972.   In.  FY  80,  we  initiated  approximately 
■  DIS.  As  of  October  1980,  average  case  completion  time  by  DIS 
was  156  days,  up  from  90  days  less  than  two  years  ago,  and  far  in  excess  of  DIS's 
target  for  SBIs:  65  day  completion  time.  DIS  and  OSD  recognize  that  there  is 
a  serious  problem  for  all  DoD  customers  of  DIS. 
2.  NSA  has  a  number  of  serious  (or  potentially  serious)  problems  because 
of  the  excessive  completion  times:  t 
•  a.  Unable  to  attract  competitive, "skill  persons  (electronic  engineers, 
computer  specialists,  for  example).   • 
b.  Unable  to  quickly  put  to  wQrk  persons  urgently  needed  to  accomplish 
NSA  mission  (linguists,  for  example). 
c.  Unable  to  fulfill  terms  of  critical  contracts,  i.e.,  cannot  grant 
clearance  access  to  contractor  personnel.  The  mission  suffers  and  lawsuits 
are  possible  (and  have  happened  in  the'past). 
3.  Public  Law  8S-290  and  DoD  Directive  5210.45  require  that  individuals 
have  had  completed  SBI  prior  to  employment,  assignment  or  detail  to  NSA. 
4.  NSA  supports  immediate  manpower  increase  for  DIS.
APEX  ISSUES 
*t&^  As  we  move  closer  to  APEX,  a  number  of  problems  have  become 
apparent.  The  original  objectives  of  the  program  and  the  basic, 
essential  concern  for  security  are  becoming  lost.   They  are  being 
obscured  by  the  large  number  of  detailed,  sometimes  conflicting, 
implementation  instructions  contained  in  interpretations  of  the 
provisions  of  the  KFIB  Final  Report  and  subsequent  APEX  manuals, 
reactions  to  procedural  proposals,  and  ad  hoc  statements  of. 
guidance  by  the  APEX  Steering  Group  and  its  various  Sub-committees. 
We  believe  it  is  essential  to  reevaluate  whether  APEX,  as  we  now 
understand  it,  is  worthwhile  or  cost-effective.   In  view  of  the 
large  resource  costs  and  security  risks  associated  with  the 
implementation  of  APEX  as  we  currently  perceive  it,  several  major 
issues  must  be  clarified.   These  issues  are: 
1.  *(G)   Tnformrtion  Security  . 
Rather  than  providing  additional  security  as  intended, 
APEX  security  procedures  appear  to  increase  the  opportunity  for  signals 
intelligence  loss,  espionage,  and  security  compromise. 
-  The  general  attribution  to  COMINT  tells  the  opposition 
where  the  information  came  from,  and  thus  where  to  look 
to  block  future  exploitation  of  those  communications. 
The  potential  of  a  major  security  compromise  both  of  the 
new  system  and  the  existing  system  is  inherent  in  the 
concurrent  use  of  both  existing  and  new  procedures  during 
the  phasing  process.  Additionally,  under  APEX  a  hard  copy 
document  gets  new  controls  and  markings  while  the  same 
information  as  that  contained  in  the  document  is  marked  - 
according  to  existing  control  systems  when  transmitted 
electrically. 
2.  ^J'C^-  Expense 
While  APEX  gives  the  appearance  of  administrative 
simplicity,  it  is  in  fact  far  more  complex  and  costly  in  its  application 
than  our  current  COMINT  handling  system.'  Conservatively,  in  additional 
tnL_llets_  plus  the  people  costs  associated  therewith  together  with. 
Hor  communications,  computer  and  other  modifications  are
iM"»  «•«>  <• 
required  to  implement  APEX  in  the  U.S.  SIGINT  System  based  upon  our 
understanding  of  the  procedural  requirements.   Since  the  DCI  has 
directed  that  these  manpower  and  dollar  costs  be  absorbed  by  the 
Program  Managers,  APEX  implementation  will  be  at  the  expense  of  existing 
SIGINT  production  and  reporting. 
3.  "-£€)-  Intelligence  Involvement  in  the  "Electronic  Age" 
The  emphasis  of  any  security  control  system  must  be  placed 
upon  protection  of  information,  regardless  of  medium.  APEX  imposes  special 
controls  only  on  that  information  which  is  hard  copy  (printed  form) 
and  handled  via  courier.  However,  the  trend  in  transmitting  intelligence 
information  is  away  from  hard  copy  us£  and  toward  an  electronic*  paperless 
environment.  For  example,  less  than*"  —   -   - 
4.  t^)-  Legal  Implications  • 
t 
In  formulating  APEX,  the  APEX  staff  has  repeatedly  dismissed 
serious  legal  problems  raised  by  the  proposed  APEX  procedures.   Especially 
serious  is  the  dilution  through  APEX  of  existing  statutory  requirements 
and  protections  related  to  cryptologic  information  and  access  thereto. 
This  unique  set  of  protection  was  enacted  by  Congress  after  long  study  of 
existing  problems  and  needs.   In  addition,  the  APEX  nondisclosure  agreement 
raises  the  potential  for  new  complex  litigation,  as  well  as  serious 
administrative/legal  problems  with  implementation,  particularly  with  respect 
to  current  employees,  assignees  and  contractors. 
5.  -f€}~  SIGINT  and  the  APEX  Model 
a.  APEX  arbitrarily  divides  the  SIGINT  categories  of 
COMINT,  ELINT  and  TELINT  into  two  separate  product  compartments.   It  mixes 
ELINT  and  TELINT  with  non-SIGINT  information  in  the  "TECHNICAL"  product 
compartment.  Operational  information  pertaining  to  all  three  categories 
is  retained  in  the  COMINT  Operational  Compartment.   This  unnatural  fragmentation 
endangers  sensitive  information.  .  «. 
b.  APEX  separates  intelligence  information  from  production 
information  and  presupposes  the  existence  of  a  SIGINT  Operational 
Compartment  to  hold  source/method  data  apart  from  SIGINT  intelligence 
information.  This  concept  appears  to_engender  significant. .administrative 
burden  x^ithout  commensurate  benefit. 
   Rather"  than  pursue  uniformity  for  the  sake  of  uniiormity, 
ve  need  to"  reconsider  what,  if  any,  change  is  required  in  the  present  handling 
of  SIGINT.
PUBLIC  CRYPTOGRAPHY 
Interest  in  cryptology  in  the  public  sector,  paritcularly  from  the 
academic  research  community,  is  a  subject  of  continuing  concern  to  KSA. 
Efforts  made  in  establishing  a  dialogue  with  both  the  government  and  the 
non-governmental  community  to  stimulate  useful  research  on  cryptography  and 
a  better  understanding  with  academe  of  the  security  implications  of  the 
public  study  of  cryptography  have  been  productive.  Toward  that  end,  KSA 
has  participated  in  forums  with  the  American  Council  on  Education  (ACE) , 
the  National  Science  Foundation  (NSF) ,  and  individual  universities  and 
scholars  to  address  issues  of  academic  freedom  and  national  security.  The 
ACE  Public  Cryptography  Study  Group  is  studying  this  subject  under  an  NSF  grant 
and  will  soon  publish  a  report  which  will  recognize  the  Government's  concerns 
about  the  national  security  impact  of  open  research,  commercial  development, 
publication,  and  discussion  of  cryptology/ in  the  public  sector.  The  ACE 
report  x*ill  encourage  voluntary  cooperation  with  NSA  in  terms  of  providing 
us  prepublication  review  of  reports  and  articles  dealing  with  cryptology. 
With  the  cooperation  of  NSF,  we,  have  recently  established  a  complementary 
grant  program  to  fund  relevant  cryptologic  research,  most  of  which  will  be 
unclassified.  This  program  will  serve  as  a  forum  in  which  the  academic 
community  can  exchange  views  on  cryptologic  research.  Within  DoD,  initiatives 
toward  coordination  of  cryptologic  research  funding  are  underway.   In  the 
coding  year,  we  will  continue  the  dialogue  on  public  cryptography  and 
inaugurate  its  research  program.   An  understanding  of  this  issue  at  the  senior 
levels  of  DoD  and  of  the  new  administration  will  provide  significant  support 
to  this  NSA  initiative.
T^ 
NSA  has  been  an  active  participant  in 
to  the  initiative. 
INTELLIGENCE  SYSTEM 
study  efforts  and  is  committed 
_____  has,  to  date,  emphasized  determining  the  feasibility 
segments  and,  in  August,  directed  that  another  year  of 
accomplished.  The  emphasis  will  be  placed  on  th« 
system  con^gpt .  The  NSA_  view  as  to  how  the(l  JLls  proceeding 
D(C->?)  and  DUSD(PR), 
and  stated, 
memorandum  to  ASDi 
of 
definition 
fl    Bof  the 
wasTest  expressed  in  a 
The  Director,  NSA  referre 
in  part: 
". .  .Your. .  .memorandum  essentially  captures  the  findings  of  the  _^^ 
in  their  18  August  meeting,-and  I  have  little  of  substance^o™ 
add.   I  would  reemphasize,  however,  the  great  importance  we  place  on  the  early 
definition  of  the  concept  of  operations,  especially  the  envisioned  processing 
and  staffing  functions,  and  how  they  may,  influence  the  choice  of  options  to  be 
pursued.   In  this  regard  refinement  of  requirements,  and  the  development  of 
an  operations  concept  must  be  undertaken  if  we  are  to  acquire  the  desired  end 
system. 
I  remain  coznitted  to  the^ 
participation  in  this  effort." 
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