H. R. 2417—5
SEC. 105. OFFICE OF INTELLIGENCE AND ANALYSIS OF THE DEPART-
MENT OF THE TREASURY.
(a) ESTABLISHMENT OF OFFICE.—(1) Chapter 3 of subtitle I
of title 31, United States Code, is amended—
(A) by redesignating section 311 as section 312; and
(B) by inserting after section 310 the following:
‘‘§ 311. Office of Intelligence and Analysis
‘‘(a) ESTABLISHMENT.—There is established within the Depart-
ment of the Treasury, the Office of Intelligence and Analysis (in
this section referred to as the ‘Office’), which shall—
‘‘(1) be responsible for the receipt, analysis, collation, and
dissemination of foreign intelligence and foreign counterintel-
ligence information (within the meaning of section 3 of the
National Security Act of 1947 (50 U.S.C. 401a)) related to
the operation and responsibilities of the Department of the
Treasury; and
‘‘(2) have such other related duties and authorities as may
be assigned to it by the Secretary, subject to the authority,
direction, and control of the Secretary.
‘‘(b) ASSISTANT SECRETARY FOR INTELLIGENCE AND ANALYSIS.—
The Office shall be headed by an Assistant Secretary, who shall
be appointed by the President, by and with the advice and consent
of the Senate. The Assistant Secretary shall report directly to
the Undersecretary of the Treasury for Enforcement.’’.
(2) The table of sections at the beginning of chapter 3 of
such title is amended by striking the item relating to section 311
and inserting the following new items:
‘‘311. Office of Intelligence and Analysis.
‘‘312. Continuing in office.’’.
(b) CONSTRUCTION OF AUTHORITY.—Nothing in section 311 of
title 31, United States Code (as amended by subsection (a)), shall
be construed to alter the authorities and responsibilities of the
Director of Central Intelligence with respect to the Office of Intel-
ligence and Analysis of the Department of the Treasury as an
element of the intelligence community.
(c) CONSULTATION WITH DCI IN APPOINTMENT OF ASSISTANT
SECRETARY.—Section 106(b)(2) of the National Security Act of 1947
(50 U.S.C. 403–6(b)(2)) is amended by adding at the end the fol-
lowing:
‘‘(E) The Assistant Secretary for Intelligence and Anal-
ysis of the Department of the Treasury.’’.
(d) CONFORMING AMENDMENTS.—
(1) NATIONAL SECURITY ACT.—Section 3(4) of the National
Security Act of 1947 (50 U.S.C. 401a(4)) is amended—
(A) in subparagraph (H), by striking ‘‘the Department
of the Treasury,’’;
(B) by redesignating subparagraphs (J) and (K) as
subparagraphs (K) and (L), respectively; and
(C) by inserting after subparagraph (I) the following
new subparagraph (J):
‘‘(J) the Office of Intelligence and Analysis of the
Department of the Treasury;’’.
(2) TITLE 31.—Section 301(e) of title 31, United States Code,
is amended by striking ‘‘7’’ and inserting ‘‘8’’.
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(3) TITLE 5.—Section 5315 of title 5, United States Code,
is amended in the item relating to Assistant Secretaries of
the Treasury by striking ‘‘(7)’’ and inserting ‘‘(8)’’.
SEC. 106. INCORPORATION OF REPORTING REQUIREMENTS.
(a) IN GENERAL.—Each requirement to submit a report to the
congressional intelligence committees that is included in the joint
explanatory statement to accompany the conference report on the
bill H.R. 2417 of the One Hundred Eighth Congress, or in the
classified annex to this Act, is hereby incorporated into this Act,
and is hereby made a requirement in law.
(b) CONGRESSIONAL INTELLIGENCE COMMITTEES DEFINED.—In
this section, the term ‘‘congressional intelligence committees’’
means—
(1) the Select Committee on Intelligence of the Senate;
and
(2) the Permanent Select Committee on Intelligence of the
House of Representatives.
SEC. 107. PREPARATION AND SUBMITTAL OF REPORTS, REVIEWS,
STUDIES, AND PLANS RELATING TO INTELLIGENCE
ACTIVITIES OF DEPARTMENT OF DEFENSE OR DEPART-
MENT OF ENERGY.
(a) CONSULTATION IN PREPARATION.—(1) The Director of Central
Intelligence shall ensure that any report, review, study, or plan
required to be prepared or conducted by a provision of this Act,
including a provision of the classified Schedule of Authorizations
referred to in section 102(a) or the classified annex to this Act,
that involves the intelligence or intelligence-related activities of
the Department of Defense or the Department of Energy is prepared
or conducted in consultation with the Secretary of Defense or the
Secretary of Energy, as appropriate.
(2) The Secretary of Defense or the Secretary of Energy may
carry out any consultation required by this subsection through
an official of the Department of Defense or the Department of
Energy, as the case may be, designated by such Secretary for
that purpose.
(b) SUBMITTAL.—Any report, review, study, or plan referred
to in subsection (a) shall be submitted, in addition to any other
committee of Congress specified for submittal in the provision con-
cerned, to the following committees of Congress:
(1) The Committees on Armed Services and Appropriations
and the Select Committee on Intelligence of the Senate.
(2) The Committees on Armed Services and Appropriations
and the Permanent Select Committee on Intelligence of the
House of Representatives.
TITLE 
II—CENTRAL 
INTELLIGENCE
AGENCY 
RETIREMENT 
AND 
DIS-
ABILITY SYSTEM
SEC. 201. AUTHORIZATION OF APPROPRIATIONS.
There is authorized to be appropriated for the Central Intel-
ligence Agency Retirement and Disability Fund for fiscal year 2004
the sum of $226,400,000.
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TITLE III—GENERAL PROVISIONS
Subtitle A—Recurring General Provisions
SEC. 301. INCREASE IN EMPLOYEE COMPENSATION AND BENEFITS
AUTHORIZED BY LAW.
Appropriations authorized by this Act for salary, pay, retire-
ment, and other benefits for Federal employees may be increased
by such additional or supplemental amounts as may be necessary
for increases in such compensation or benefits authorized by law.
SEC. 302. RESTRICTION ON CONDUCT OF INTELLIGENCE ACTIVITIES.
The authorization of appropriations by this Act shall not be
deemed to constitute authority for the conduct of any intelligence
activity which is not otherwise authorized by the Constitution or
the laws of the United States.
Subtitle B—Intelligence
SEC. 311. AUTHORITY OF FEDERAL BUREAU OF INVESTIGATION TO
AWARD PERSONAL SERVICES CONTRACTS.
(a) AUTHORITY.—(1) Title III of the National Security Act of
1947 is amended by inserting after section 301 (50 U.S.C. 409a)
the following new section:
‘‘AUTHORITY OF FEDERAL BUREAU OF INVESTIGATION TO AWARD
PERSONAL SERVICES CONTRACTS
‘‘SEC. 302. (a) IN GENERAL.—The Director of the Federal Bureau
of Investigation may enter into personal services contracts if the
personal services to be provided under such contracts directly sup-
port the intelligence or counterintelligence missions of the Federal
Bureau of Investigation.
‘‘(b) INAPPLICABILITY
OF CERTAIN REQUIREMENTS.—Contracts
under subsection (a) shall not be subject to the annuity offset
requirements of sections 8344 and 8468 of title 5, United States
Code, the requirements of section 3109 of title 5, United States
Code, or any law or regulation requiring competitive contracting.
‘‘(c) CONTRACT TO BE APPROPRIATE MEANS OF SECURING SERV-
ICES.—The Chief Contracting Officer of the Federal Bureau of Inves-
tigation shall ensure that each personal services contract entered
into by the Director under this section is the appropriate means
of securing the services to be provided under such contract.’’.
(2) The table of contents for that Act is amended by inserting
after the item relating to section 301 the following new item:
‘‘Sec. 302. Authority of Federal Bureau of Investigation to award personal services
contracts.’’.
(b) REPORTS ON EXERCISE OF AUTHORITY.—(1) Not later than
one year after the date of the enactment of this Act, and annually
thereafter, the Director of the Federal Bureau of Investigation
shall submit to the appropriate committees of Congress a report
on the exercise of the authority in section 302 of the National
Security Act of 1947, as added by subsection (a).
(2) Each report under this subsection shall include, for the
one-year period ending on the date of such report, the following:
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(A) The number of contracts entered into during the period.
(B) The cost of each such contract.
(C) The length of each such contract.
(D) The types of services to be provided under each such
contract.
(E) The availability, if any, of United States Government
personnel to perform functions similar to the services to be
provided under each such contract.
(F) The efforts of the Federal Bureau of Investigation to
fill available personnel vacancies, or request additional per-
sonnel positions, in areas relating to the intelligence or counter-
intelligence mission of the Bureau.
(3) Each report under this subsection shall be submitted in
unclassified form, but may include a classified annex.
(4) In this subsection—
(A) for purposes of the submittal of the classified annex
to any report under this subsection, the term ‘‘appropriate
committees of Congress’’ means—
(i) the Select Committee on Intelligence of the Senate;
and
(ii) the Permanent Select Committee on Intelligence
of the House of Representatives; and
(B) for purposes of the submittal of the unclassified portion
of any report under this subsection, the term ‘‘appropriate
committees of Congress’’ means—
(i) the committees specified in subparagraph (A);
(ii) the Committees on Appropriations, Governmental
Affairs, and the Judiciary of the Senate; and
(iii) the Committees on Appropriations, Government
Reform and Oversight, and the Judiciary of the House
of Representatives.
SEC. 312. BUDGET TREATMENT OF COSTS OF ACQUISITION OF MAJOR
SYSTEMS BY THE INTELLIGENCE COMMUNITY.
(a) FINDINGS.—Congress makes the following findings:
(1) Funds within the National Foreign Intelligence Program
often must be shifted from program to program and from fiscal
year to fiscal year to address funding shortfalls caused by
significant increases in the costs of acquisition of major systems
by the intelligence community.
(2) While some increases in the costs of acquisition of
major systems by the intelligence community are unavoidable,
the magnitude of growth in the costs of acquisition of many
major systems indicates a systemic bias within the intelligence
community to underestimate the costs of such acquisition,
particularly in the preliminary stages of development and
production.
(3) Decisions by Congress to fund the acquisition of major
systems by the intelligence community rely significantly upon
initial estimates of the affordability of acquiring such major
systems and occur within a context in which funds can be
allocated for a variety of alternative programs. Thus, substan-
tial increases in costs of acquisition of major systems place
significant burdens on the availability of funds for other pro-
grams and new proposals within the National Foreign Intel-
ligence Program.