H. R. 2417—9
(4) Independent cost estimates, prepared by independent
offices, have historically represented a more accurate projection
of the costs of acquisition of major systems.
(5) Recognizing the benefits associated with independent
cost estimates for the acquisition of major systems, the Sec-
retary of Defense has built upon the statutory requirement
in section 2434 of title 10, United States Code, to develop
and consider independent cost estimates for the acquisition
of such systems by mandating the use of such estimates in
budget requests of the Department of Defense.
(6) The mandatory use throughout the intelligence commu-
nity of independent cost estimates for the acquisition of major
systems will assist the President and Congress in the develop-
ment and funding of budgets which more accurately reflect
the requirements and priorities of the United States Govern-
ment for intelligence and intelligence-related activities.
(b) BUDGET TREATMENT OF COSTS OF ACQUISITION OF MAJOR
SYSTEMS.—(1) Title V of the National Security Act of 1947 (50
U.S.C. 413 et seq.) is amended by inserting after section 506 the
following new section:
‘‘BUDGET TREATMENT OF COSTS OF ACQUISITION OF MAJOR SYSTEMS
BY THE INTELLIGENCE COMMUNITY
‘‘SEC. 506A. (a) INDEPENDENT
COST
ESTIMATES.—(1) The
Director of Central Intelligence shall, in consultation with the head
of each element of the intelligence community concerned, prepare
an independent cost estimate of the full life-cycle cost of develop-
ment, procurement, and operation of each major system to be
acquired by the intelligence community.
‘‘(2) Each independent cost estimate for a major system shall,
to the maximum extent practicable, specify the amount required
to be appropriated and obligated to develop, procure, and operate
the major system in each fiscal year of the proposed period of
development, procurement, and operation of the major system.
‘‘(3)(A) In the case of a program of the intelligence community
that qualifies as a major system, an independent cost estimate
shall be prepared before the submission to Congress of the budget
of the President for the first fiscal year in which appropriated
funds are anticipated to be obligated for the development or procure-
ment of such major system.
‘‘(B) In the case of a program of the intelligence community
for which an independent cost estimate was not previously required
to be prepared under this section, including a program for which
development or procurement commenced before the date of the
enactment of the Intelligence Authorization Act for Fiscal Year
2004, if the aggregate future costs of development or procurement
(or any combination of such activities) of the program will exceed
$500,000,000 (in current fiscal year dollars), the program shall
qualify as a major system for purposes of this section, and an
independent cost estimate for such major system shall be prepared
before the submission to Congress of the budget of the President
for the first fiscal year thereafter in which appropriated funds
are anticipated to be obligated for such major system.
‘‘(4) The independent cost estimate for a major system shall
be updated upon—
‘‘(A) the completion of any preliminary design review associ-
ated with the major system;
H. R. 2417—10
‘‘(B) any significant modification to the anticipated design
of the major system; or
‘‘(C) any change in circumstances that renders the current
independent cost estimate for the major system inaccurate.
‘‘(5) Any update of an independent cost estimate for a major
system under paragraph (4) shall meet all requirements for inde-
pendent cost estimates under this section, and shall be treated
as the most current independent cost estimate for the major system
until further updated under that paragraph.
‘‘(b) PREPARATION OF INDEPENDENT COST ESTIMATES.—(1) The
Director shall establish within the Office of the Deputy Director
of Central Intelligence for Community Management an office which
shall be responsible for preparing independent cost estimates, and
any updates thereof, under subsection (a), unless a designation
is made under paragraph (2).
‘‘(2) In the case of the acquisition of a major system for an
element of the intelligence community within the Department of
Defense, the Director and the Secretary of Defense shall provide
that the independent cost estimate, and any updates thereof, under
subsection (a) be prepared by an entity jointly designated by the
Director and the Secretary in accordance with section 2434(b)(1)(A)
of title 10, United States Code.
‘‘(c) UTILIZATION IN BUDGETS OF PRESIDENT.—(1) If the budget
of the President requests appropriations for any fiscal year for
the development or procurement of a major system by the intel-
ligence community, the President shall, subject to paragraph (2),
request in such budget an amount of appropriations for the develop-
ment or procurement, as the case may be, of the major system
that is equivalent to the amount of appropriations identified in
the most current independent cost estimate for the major system
for obligation for each fiscal year for which appropriations are
requested for the major system in such budget.
‘‘(2) If the amount of appropriations requested in the budget
of the President for the development or procurement of a major
system is less than the amount of appropriations identified in
the most current independent cost estimate for the major system
for obligation for each fiscal year for which appropriations are
requested for the major system in such budget, the President shall
include in the budget justification materials submitted to Congress
in support of such budget—
‘‘(A) an explanation for the difference between the amount
of appropriations requested and the amount of appropriations
identified in the most current independent cost estimate;
‘‘(B) a description of the importance of the major system
to the national security;
‘‘(C) an assessment of the consequences for the funding
of all programs of the National Foreign Intelligence Program
in future fiscal years if the most current independent cost
estimate for the major system is accurate and additional appro-
priations are required in future fiscal years to ensure the
continued development or procurement of the major system,
including the consequences of such funding shortfalls on the
major system and all other programs of the National Foreign
Intelligence Program; and
‘‘(D) such other information on the funding of the major
system as the President considers appropriate.
H. R. 2417—11
‘‘(d) INCLUSION OF ESTIMATES IN BUDGET JUSTIFICATION MATE-
RIALS.—The budget justification materials submitted to Congress
in support of the budget of the President shall include the most
current independent cost estimate under this section for each major
system for which appropriations are requested in such budget for
any fiscal year.
‘‘(e) DEFINITIONS.—In this section:
‘‘(1) The term ‘budget of the President’ means the budget
of the President for a fiscal year as submitted to Congress
under section 1105(a) of title 31, United States Code.
‘‘(2) The term ‘independent cost estimate’ means a prag-
matic and neutral analysis, assessment, and quantification of
all costs and risks associated with the acquisition of a major
system, which shall be based on programmatic and technical
specifications provided by the office within the element of the
intelligence community with primary responsibility for the
development, procurement, or operation of the major system.
‘‘(3) The term ‘major system’ means any significant program
of an element of the intelligence community with projected
total 
development 
and 
procurement 
costs 
exceeding
$500,000,000 (in current fiscal year dollars), which costs shall
include all end-to-end program costs, including costs associated
with the development and procurement of the program and
any other costs associated with the development and procure-
ment of systems required to support or utilize the program.’’.
(2) The table of contents for the National Security Act of 1947
is amended by inserting after the item relating to section 506
the following new item:
‘‘Sec. 506A. Budget treatment of costs of acquisition of major systems by the intel-
ligence community.’’.
(c) EFFECTIVE DATE.—The amendments made by subsection
(b) shall take effect on the date of the enactment of this Act.
(d) LIMITATIONS.—(1)(A) For each major system for which funds
have been authorized for a fiscal year before fiscal year 2005,
or for which funds are sought in the budget of the President
for fiscal year 2005, as submitted to Congress pursuant to section
1105(a) of title 31, United States Code, and for which no inde-
pendent cost estimate has been provided to Congress, no contract,
or option to contract, for the procurement or acquisition of such
major system may be entered into, or option to contract be exercised,
before the date of the enactment of an Act to authorize appropria-
tions for fiscal year 2005 for intelligence and intelligence-related
activities of the United States Government.
(B) Subparagraph (A) shall not affect any contract for procure-
ment or acquisition that was entered into before the date of the
enactment of this Act.
(2) Commencing as of the date of the submittal to Congress
of the budget of the President for fiscal year 2006 pursuant to
section 1105(a) of title 31, United States Code, no funds may be
obligated or expended for the development or procurement of a
major system until the President has complied with the require-
ments of section 506A of the National Security Act of 1947 (as
added by subsection (b)) with respect to such major system.
H. R. 2417—12
(3) In this subsection, the terms ‘‘independent cost estimate’’
and ‘‘major system’’ have the meaning given such terms in sub-
section (e) of section 506A of the National Security Act of 1947
(as so added).
SEC. 313. MODIFICATION OF SUNSET OF APPLICATION OF SANCTIONS
LAWS TO INTELLIGENCE ACTIVITIES.
(a) MODIFICATION.—Section 905 of the National Security Act
of 1947 (50 U.S.C. 441d) is repealed.
(b) CLERICAL AMENDMENT.—The table of contents for that Act
is amended by striking the item relating to section 905.
SEC. 314. MODIFICATION OF NOTICE AND WAIT REQUIREMENTS ON
PROJECTS TO CONSTRUCT OR IMPROVE INTELLIGENCE
COMMUNITY FACILITIES.
(a) INCREASE OF THRESHOLDS FOR NOTICE.—Subsection (a) of
section 602 of the Intelligence Authorization Act for Fiscal Year
1995 (Public Law 103–359; 108 Stat. 3432; 50 U.S.C. 403–2b(a))
is amended—
(1) by striking ‘‘$750,000’’ each place it appears and
inserting ‘‘$5,000,000’’; and
(2) by striking ‘‘$500,000’’ each place it appears and
inserting ‘‘$1,000,000’’.
(b) NOTICE
AND
WAIT
REQUIREMENTS
FOR
EMERGENCY
PROJECTS.—Subsection (b)(2) of that section is amended—
(1) by redesignating subparagraphs (A), (B), and (C) as
clauses (i), (ii), and (iii), respectively;
(2) by inserting ‘‘(A)’’ after ‘‘(2) REPORT.—’’;
(3) by striking ‘‘21-day period’’ and inserting ‘‘7-day period’’;
and
(4) by adding at the end the following new subparagraph:
‘‘(B) Notwithstanding subparagraph (A), a project referred
to in paragraph (1) may begin on the date the notification
is received by the appropriate committees of Congress under
that paragraph if the Director of Central Intelligence and the
Secretary of Defense jointly determine that—
‘‘(i) an emergency exists with respect to the national
security or the protection of health, safety, or environ-
mental quality; and
‘‘(ii) any delay in the commencement of the project
would harm any or all of those interests.’’.
SEC. 315. EXTENSION OF DEADLINE FOR FINAL REPORT OF THE
NATIONAL COMMISSION FOR THE REVIEW OF THE
RESEARCH AND DEVELOPMENT PROGRAMS OF THE
UNITED STATES INTELLIGENCE COMMUNITY.
(a) IN GENERAL.—Subsection (a) of section 1007 of the Intel-
ligence Authorization Act for Fiscal Year 2003 (Public Law 107–
306; 50 U.S.C. 401 note; 116 Stat. 2442) is amended by striking
‘‘September 1, 2003’’ and inserting ‘‘September 1, 2004’’.
(b) EFFECTIVE DATE.—The amendment made by subsection (a)
shall take effect as if included in the enactment of section 1007
of the Intelligence Authorization Act for Fiscal Year 2003.
SEC. 316. IMPROVEMENT OF INFORMATION SHARING AMONG FED-
ERAL, STATE, AND LOCAL GOVERNMENT OFFICIALS.
(a) TRAINING PROGRAM
FOR STATE
AND LOCAL OFFICIALS.—
Section 892(c) of the Homeland Security Act of 2002 (Public Law