To amend the Internal Revenue Code of 1986 to allow taxpayers to designate $3 of their income tax liability for purposes of homeland security and further to establish an Office of Homeland Security within the Executive Office of the President.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Homeland Security Fund Act of 
2002''.

    TITLE I--DESIGNATION OF AMOUNTS FOR HOMELAND SECURITY; HOMELAND 
                             SECURITY FUND

SEC. 101. DESIGNATION OF AMOUNTS FOR HOMELAND SECURITY.

    (a) In General.--Subchapter A of chapter 61 of the Internal Revenue 
Code of 1986 (relating to returns and records) is amended by adding at 
the end the following new part:

              ``PART IX--DESIGNATION FOR HOMELAND SECURITY

                              ``Sec. 6097. Designation.

``SEC. 6097. DESIGNATION.

    ``(a) In General.--Every taxpayer whose adjusted income tax 
liability for the taxable year is $3 or more may designate that $3 be 
paid over to the Homeland Security Fund.
    ``(b) Manner and Time of Designation.--A designation under 
subsection (a) may be made with respect to any taxable year--
            ``(1) at the time of filing the return of the tax imposed 
        by chapter 1 for such taxable year, or
            ``(2) at any other time (after the time of filing the 
        return of the tax imposed by chapter 1 for such taxable year) 
        specified in regulations prescribed by the Secretary.
Such designation shall be made in such manner as the Secretary 
prescribes by regulations except that, if such designation is made at 
the time of filing the return of the tax imposed by chapter 1 for such 
taxable year, such designation shall be made either on the first page 
of the return or on the page bearing the taxpayer's signature.
    ``(c) Special Rules.--
            ``(1) Designation of income tax liability.--
                    ``(A) Joint returns.--In the case of a joint return 
                having an adjusted income tax liability of $6 or more, 
                each spouse may designate that $3 be paid over to the 
                Homeland Security Fund.
                    ``(B) Adjusted income tax liability.--For purposes 
                of this section, the term `adjusted income tax 
                liability' means income tax liability (as defined in 
                section 6096(b)) reduced by any amount designated under 
                section 6096 (relating to designation of income tax 
                payments to Presidential Election Campaign Fund).''
    (b) Clerical Amendment.--The table of parts for such subchapter A 
is amended by adding at the end the following new item:

                              ``Part IX. Designation for Homeland 
                                        Security.''
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after the date of the enactment of this 
Act.

SEC. 102. HOMELAND SECURITY FUND.

    (a) In General.--Subchapter A of chapter 98 of the Internal Revenue 
Code of 1986 (relating to trust fund code) is amended by adding at the 
end the following new section:

``SEC. 9511. HOMELAND SECURITY FUND.

    ``(a) Creation of Trust Fund.--There is established in the Treasury 
of the United States a trust fund to be known as the `Homeland Security 
Fund', consisting of such amounts as may be appropriated or credited to 
such Trust Fund as provided in this section or section 9602(b).
    ``(b) Transfers to Trust Fund.--There are hereby appropriated to 
the Homeland Security Fund amounts equivalent to the amounts designated 
under section 6097 (relating to designation for homeland security).
    ``(c) Expenditures.--Amounts in the Homeland Security Fund shall be 
available, as provided in appropriation Acts, for making expenditures 
before January 1, 2007, for purposes of--
            ``(1) adapting public health infrastructure to new threats,
            ``(2) securing all modes of transportation,
            ``(3) protecting America's physical and informational 
        infrastructure,
            ``(4) providing law enforcement with the technology to 
        effectively combat terrorism,
            ``(5) improving interagency and intergovernmental 
        coordination, prevention and response, and
            ``(6) preventing proliferation of weapons of mass 
        destruction and preparing the military to effectively fight 
        terrorism.''
    (b) Clerical Amendment.--The table of sections for such subchapter 
is amended by adding at the end the following new item:

                              ``Sec. 9511. Homeland Security Fund.''

                 TITLE II--OFFICE OF HOMELAND SECURITY

SEC. 201. OFFICE OF HOMELAND SECURITY.

    There is established within the Executive Office of the President 
an office to be known as the ``Office of Homeland Security'' (in this 
title referred to as the ``Office'').

SEC. 202. DIRECTOR OF HOMELAND SECURITY.

    (a) Director.--The head of the Office shall be the Director of the 
Office of Homeland Security, who shall be appointed by the President, 
by and with the advice and consent of the Senate. The President shall 
ensure that the Director functions as a cabinet-level official.
    (b) Executive Schedule I Pay Rate for Director.--Section 5312 of 
title 5, United States Code, is amended by inserting after the item 
relating to the Director of National Drug Control Policy the following 
new item:
            ``Director of the Office of Homeland Security.''.

SEC. 203. RESPONSIBILITIES.

    Subject to the direction and control of the President, the 
responsibilities of the Director shall include the following:
            (1) Directing, in consultation with appropriate Federal and 
        State agencies and Congress, the creation of a national 
        strategy for homeland security, as provided in section 204, to 
        include all aspects of prevention and response to terrorist 
        activities.
            (2) Developing, reviewing, and approving, in collaboration 
        with the Director of the Office of Management and Budget, a 
        national budget for homeland security and the allocation of 
        amounts in the Homeland Security Fund among the purposes 
        specified in section 9511(c) of the Internal Revenue Code of 
        1986.
            (3) Reviewing programs, plans and activities of the 
        relevant Federal agencies to insure effective implementation of 
        the national homeland security strategy.
            (4) Coordinating the planning and implementation of all 
        Federal homeland security activities with relevant Federal 
        agencies for the purposes of removing unnecessary duplication 
        and gaps in counterterrorism activities.
            (5) Certifying as part of the budget submission of the 
        President to Congress the relevance and accuracy of 
        counterterrorism budgets from Federal agencies and rejecting 
        budget requests not consistent with the national homeland 
        security strategy.
            (6) Directing and reviewing the development of a 
        comprehensive national assessment on the threat to homeland 
        security, which shall be conducted by the heads of relevant 
        Federal agencies.
            (7) Overseeing the appropriate sharing of information among 
        Federal, State, and local agencies involved in intelligence 
        collection and law enforcement for the purpose of protecting 
        homeland security.
            (8) Establishing a center within the Office to analyze and 
        publicize as appropriate lessons learned from homeland security 
        exercises conducted by Federal, State, and local government 
        agencies and other organizations involved in terrorism 
        response.
            (9) Consulting regularly with Congress on all issues 
        relating to homeland security.
            (10) Attending meetings of the President's cabinet and the 
        National Security Council relating to counterterrorism and 
        homeland security.
            (11) Serving as the President's principal spokesperson on 
        issues relevant to homeland security.

SEC. 204. NATIONAL HOMELAND SECURITY STRATEGY.

    The national homeland security strategy created under section 203 
shall include the following:
            (1) A comprehensive research, development, and procurement 
        plan for supporting homeland security.
            (2) Mechanisms to insure the flexibility and mobility in 
        Federal personnel policies and practices to achieve maximum 
        effective use of personnel among all concerned agencies.
            (3) Policies and procedures to maximize the collection, 
        analysis, translation, exploitation, and dissemination of, 
        throughout the Federal Government and with State and local 
        authorities, information relevant to homeland security 
        concerns.
            (4) Plans for improving the resources of, coordination 
        among, and effectiveness of health and medical sectors for 
        detecting and responding to terrorist attacks on the homeland.
            (5) Specific measures to enhance cooperative efforts 
        between the public and private sectors in protecting homeland 
        security.

SEC. 205. OFFICERS AND STAFF OF OFFICE.

    (a) Officers.--The President shall assign to the Office such 
officers in addition to the Director, if any, as the President, in 
consultation with the Director, considers appropriate to discharge the 
responsibilities of the Office.
    (b) Staff.--The Director may appoint such employees, and may detail 
employees from other agencies, as necessary to carry out the functions 
of the Office. Such employees shall include individuals with relevant 
State and local expertise.

SEC. 206. ANNUAL REPORTS.

    The Director shall submit to the Congress annual reports of the 
activities of the Office in carrying out the responsibilities specified 
in section 203.

SEC. 207. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated such amounts as are 
necessary to carry out this title.

Summary: Homeland Security Fund Act of 2002 - Amends the Federal Internal Revenue Code to authorize each taxpayer to designate $3 of tax liability to a Homeland Security Fund established by this Act. Authorizes disbursements from the fund prior to January 1, 2007, for a variety of purposes, including: (1) helping law enforcement battle terrorism; (2) securing all modes of transportation; and (3) preventing proliferation of weapons of mass destruction and helping the military to fight terrorism.Establishes an Office of Homeland Security, to be headed by a Director of Homeland Security. Grants the Director cabinet-level status. Assigns the Director tasks coordinating the effort by the Federal, State, and local governments to safeguard the nation from terrorism. Directs the Director, among other tasks, to: (1) develop a national strategy for homeland security in consultation with Congress and Federal and State agencies; and (2) establish a national budget for homeland security in collaboration with the Director of the Office of Management and Budget.