(2) by adding at the end the following new sen-
tence: ‘‘Notwithstanding the preceding provisions of 
this paragraph, when the Director of Central Intel-
ligence and Secretary of Defense jointly determine 
that an emergency relating to the national security or 
to the protection of health, safety, or environmental 
quality exists and that delay would irreparably harm 
any or all of those interests, the project may begin on 
the date the notification is received by such commit-
tees.’’. 
Subtitle C—Counterintelligence
SEC. 321. COUNTERINTELLIGENCE INITIATIVES FOR THE 
INTELLIGENCE COMMUNITY. 
(a) IN GENERAL.—(1) Title XI of the National Secu-
rity Act of 1947 (50 U.S.C. 401 et seq.) is amended by add-
ing at the end the following new section: 
‘‘COUNTERINTELLIGENCE INITIATIVES 
‘‘SEC. 1102. (a) INSPECTION PROCESS.—(1) In order 
to protect intelligence sources and methods from unauthor-
ized disclosure, the Director of Central Intelligence shall es-
tablish and implement an inspection process for all agencies 
and departments of the United States that handle classified 
information relating to the national security of the United 
States intended to assure that those agencies and depart-
ments maintain effective operational security practices and 
programs directed against counterintelligence activities.
‘‘(2) The Director shall carry out the process through 
the Office of the National Counterintelligence Executive. 
‘‘(b) FBI COUNTERINTELLIGENCE OFFICE.—The At-
torney General, acting through the Director of the Federal 
Bureau of Investigation, shall establish an Office of Coun-
terintelligence within the Bureau to investigate potential es-
pionage activities within the Bureau. 
‘‘(c) ANNUAL REVIEW OF DISSEMINATION LISTS.—(1) 
The Director of Central Intelligence shall establish and im-
plement a process for all elements of the intelligence commu-
nity (as defined in section 101(4)) to review, on an annual 
basis, individuals included on distribution lists for access 
to classified information. Such process shall ensure that 
only individuals who have a particularized ‘need to know’ 
(as determined by the Director) are continued on such dis-
tribution lists. 
‘‘(2) Not later than October 15 of each year, the Direc-
tor shall certify to the congressional intelligence committees 
that the review required under paragraph (1) has been con-
ducted in all elements of the intelligence community during 
the preceding fiscal year. 
‘‘(d) REQUIRED COMPLETION OF FINANCIAL DISCLO-
SURE STATEMENTS.—(1) The Director of Central Intel-
ligence shall establish and implement a process by which 
heads of the elements of the intelligence community (as de-
fined in section 101(4)) direct that all employees, in order 
to be granted access to classified information, submit finan-
cial disclosure forms required under section 1.3(b) of Execu-
tive Order No. 12969 (August 2, 1995; 60 F.R. 40245; 50 
U.S.C. 435 note). 
‘‘(2) The Director shall carry out paragraph (1) 
through the Office of the National Counterintelligence Exec-
utive. 
‘‘(e) ARRANGEMENTS TO HANDLE SENSITIVE INFOR-
MATION.—The Director of Central Intelligence shall estab-
lish, for all elements of the intelligence community (as de-
fined in section 101(4)), programs and procedures by which 
sensitive classified information relating to human intel-
ligence is safeguarded against unauthorized disclosure by 
employees of those elements.’’. 
(2) The table of contents contained in the first section 
of such Act is amended in the items relating to title XI 
by adding at the end the following new item:
‘‘Sec. 1102. Counterintelligence initiatives.’’.
(b) INTELLIGENCE AND NATIONAL SECURITY ASPECTS 
OF ESPIONAGE PROSECUTIONS.—The Attorney General, 
acting through the Office of Intelligence Policy and Review 
of the Department of Justice, in consultation with the Office 
of the National Counterintelligence Executive, shall estab-
lish policies and procedures to assist the Attorney General 
in the Attorney General’s consideration of intelligence and
national security equities in the development of charging 
documents and related pleadings in espionage prosecutions. 
Subtitle D—Other Matters 
SEC. 331. EXTENSION OF SUSPENSION OF REORGANIZA-
TION 
OF 
DIPLOMATIC 
TELECOMMUNI-
CATIONS SERVICE PROGRAM OFFICE. 
Section 311 of the Intelligence Authorization Act for 
Fiscal Year 2002 (Public Law 107–108; 115 Stat. 1401; 
22 U.S.C. 7301 note), as amended by section 351 of the 
Intelligence Authorization Act for Fiscal Year 2003 (Public 
Law 107–306; 116 Stat. 2401; 22 U.S.C. 7301 note), is 
amended—
(1) in the heading, by striking ‘‘TWO-YEAR’’ be-
fore ‘‘SUSPENSION OF REORGANIZATION’’; and 
(2) in the text, by striking ‘‘ending on October 
1, 2003’’ and inserting ‘‘ending on the date that is 60 
days after the date on which appropriate congres-
sional committees of jurisdiction (as defined in sec-
tion 324(d) of that Act (22 U.S.C. 7304(d)) are noti-
fied jointly by the Secretary of State (or the Sec-
retary’s designee) and the Director of the Office of 
Management and Budget (or the Director’s designee) 
that the operational framework for the office has been 
terminated’’.
SEC. 332. MODIFICATIONS OF AUTHORITIES ON EXPLOSIVE 
MATERIALS. 
(a) AUTHORITY TO DISTRIBUTE EXPLOSIVE MATE-
RIALS TO QUALIFIED ALIENS.—Notwithstanding any other 
provision of law, it shall be lawful for any person know-
ingly to distribute explosive materials to any qualified 
alien—
(1) if, in the case of a qualified alien described 
in subsection (c)(1), the distribution to, shipment to, 
transportation to, receipt by, or possession by the 
alien of the explosive materials is in furtherance of 
such cooperation; or 
(2) if, in the case of a qualified alien described 
in subsection (c)(2), the distribution to, shipping to, 
transporting to, possession by, or receipt by the alien 
of explosive materials is in furtherance of the author-
ized military purpose. 
(b) AUTHORITY FOR QUALIFIED ALIENS TO SHIP EX-
PLOSIVE MATERIALS.—Notwithstanding any other provi-
sion of law, it shall be lawful for a qualified alien to ship 
or transport any explosive in or affecting interstate or for-
eign commerce or to receive or possess any explosive which 
has been shipped or transported in or affecting interstate 
or foreign commerce—
(1) if, in the case of a qualified alien described 
in subsection (c)(1), the possession, shipment, or