Intelligence Community Spending: Trends and Issues
Released: 2018-06-18T00:00:00

Introduction

This report examines intelligence funding over the past several decades, with an emphasis on the period from 2007 to 2018, during which total national and military intelligence program spending dollars have been publicly disclosed on an annual basis. A table of topline budget figures (see Table 1 ) and accompanying graphs (see Figure 2 and Figure 3 ) illustrate that in comparison with national defense spending, intelligence-related spending has remained relatively constant over the past decade, representing approximately 11% of annual national defense spending over that time period.

Various tables and graphs included in this report illustrate trends in intelligence spending. Figure 1 illustrates highs and lows in NIP spending between 1965 and 1994. Table 1 compares NIP and MIP spending to national def ense spending from FY2007 to FY2019 , reporting values in both nominal and constant dollars. Figure 2 and Figure 3 use the data in Table 1 to provide an overview of intelligence spending compared to tota l national defense spending.

Additional tables in Appendix B and Appendix C provide an ove rview of the IC budget programs. Table B-1 identifies 4 defense NIP programs, 8 nondefense NIP programs, and 10 MIP programs. Table C-1 illustrates how those MIP and NIP intelligence programs are spread across different departments and agencies with an intelligence mission. Table C-1 lists the 17 components of the i ntelligence c ommunity (IC) as def ined by statute .

This report is p ublished in conjunction with CRS Report R44681, Intelligence Community Programs, Management, and Enduring Issues , by [author name scrubbed] , which examines IC spending programs—to include specifics related to NIP and MIP subordinate programs such as the Consolidated Cryptologic Program (CCP) and National Reconnaissance Program (NRP).

The Intelligence Budget

Intelligence spending is usually understood as the sum of two separate budget programs: (1) the NIP, which covers the programs, projects, and activities of the intelligence community oriented toward the strategic needs of decisionmakers, and (2) the MIP, which funds defense intelligence activities intended to support operational and tactical level intelligence priorities supporting defense operations.

The combined NIP and MIP budgets do not encompass the total of U.S. intelligence-related spending. Many departments have intelligence-gathering entities that support a department-specific mission, use department funds, and do not fall within either the NIP or the MIP. For example, the Homeland Security Intelligence Program (HSIP) is sometimes referenced in intelligence-related legislation. It is a small program that exists within the Department of Homeland Security (DHS) to fund those intelligence activities of the DHS Office of Intelligence and Analysis that serve predominantly departmental missions. With the exception of U.S. Coast Guard Intelligence and the Office of Intelligence and Analysis, the NIP does not fund intelligence activities of the Department of Homeland Security, nor does the NIP fund intelligence activities of state, local, and tribal governments. In addition, the MIP does not fund certain military platforms that can have an intelligence mission, such as the E-3 Airborne Warning and Control System (AWACS) or the MQ-9 Reaper unmanned aerial vehicle (UAV) air-to-ground strike platform.

The intelligence budget funds intelligence and intelligence-related activities —defined in this report to include the following:

The collection, analysis, production, dissemination, or use of information that relates to a foreign country, or a government, political group, party, military force, movement, or other association in a foreign country, and that relates to the defense, foreign policy, national security, or related policies of the United States and other activity in support of the collection, analysis, production, dissemination, or use of such information; Activities taken to counter similar activities directed against the United States; Covert or clandestine activities affecting the relations of the United States with a foreign government, political group, party, military force, movement, or other association; Collection, analysis, production, dissemination, or use of information about activities of persons within the United States, its territories and possessions, or nationals of the United States abroad whose political and related activities pose, or may be considered by a department, agency, bureau, office, division, instrumentality, or employee of the United States to pose, a threat to the internal security of the United States; and Covert or clandestine activities directed against persons within the United States, its territories and possessions, or nationals of the United States abroad whose political and related activities pose, or may be considered by a department, agency, bureau, office, division, instrumentality, or employee of the United States to pose, a threat to the internal security of the United States.

Origin of the Intelligence Budget

The intelligence budget, separate and distinct from the defense budget, dates to reforms initiated in the 1970s to improve oversight and accountability of the IC. Presidents Ford, Carter, and Reagan gradually centralized management and oversight over what was then known as the National Foreign Intelligence Program (NFIP), which consolidated the CIA budget with portions of the defense budget associated with national intelligence activities such as cryptologic and reconnaissance programs. Originally the Director of Central Intelligence (DCI) managed the NFIP, in consultation with the Secretary of Defense, and the National Security Council (NSC) provided oversight.

The Intelligence Reform and Terrorism Prevention Act (IRTPA) of 2004 (see §1074 of P.L. 108-458 ) renamed and modified the NFIP as the NIP. The IRTPA also created the position of Director of National Intelligence (DNI). The DNI was given greater budgetary authority in conjunction with the NIP than the DCI had in conjunction with the NFIP. Intelligence Community Directive (ICD) 104 provides overall policy to include a description of the DNI's roles and responsibilities as program executive of the NIP.

Military-specific t actical or operational intelligence activities were not included in the NFIP. They were referred to as Tactical Intelligence a nd Related Activities (TIARA) and were managed separately by the Secretary of Defense. TIARA referred to the intelligence activities "of a single service" that were considered organic (meaning "to belong to") military units. In 1994, a new category was created called the Joint Military In telligence Program (or JMIP) for defense-wide intelligence programs. A DOD memorandum signed by the Secretary of Defense in 2005 merged TIARA and JMIP to create the MIP. DOD Directive 5205.12, signed in November 2008, established policies and assigned responsibilities, to include the role of Under Secretary of Defense for Intelligence (USD(I)) as MIP program executive and "principal proponent for MIP policies and resources," acting on behalf of the Secretary of Defense.

Thus, the DNI and USD(I), respectively, manage the NIP and MIP separately under different authorities. A program is primarily NIP if it funds an activity that supports more than one department or agency, or provides a service of common concern for the IC. The NIP funds the CIA and the strategic-level intelligence activities associated with the NSA, DIA, and NGA. It also funds Sensitive Compartmented Information (SCI) programs throughout the IC. A program is primarily MIP if it funds an activity that addresses a unique DOD requirement. The DNI and USD(I) work together in a number of ways to facilitate the integration of NIP and MIP intelligence efforts. Mutually beneficial programs may receive both NIP and MIP resources.

The NIP may be perceived as more complicated than the MIP because it is an aggregation of programs that span the entire IC. In general, NIP programs are based on capabilities such as cryptology, reconnaissance, and signals collection that span several IC components. Each program within the NIP is headed by a program manager. Program managers exercise daily direct control over their NIP resources. The DNI acts as an intermediary in the budget process, between these managers, the President, and Congress. The DNI determines and controls defense and nondefense NIP funds from budget development through execution.

In contrast, the MIP encompasses only those defense dollars associated with the operational and tactical-level intelligence activities of the military services. According to the MIP charter directive:

The MIP consists of programs, projects, or activities that support the Secretary of Defense's intelligence, counterintelligence, and related intelligence responsibilities. This includes those intelligence and counterintelligence programs, projects, or activities that provide capabilities to meet warfighters' operational and tactical requirements more effectively. The term excludes capabilities associated with a weapons system whose primary mission is not intelligence.

Some experts have described the MIP as follows:

... the "take it with you" intelligence organic to the deployable units in all services at all echelons of command, for example, the Navy's anti-submarine ships with the Surveillance Towed Array Sensor System (SURTASS), the Air Force's RC-135 Rivet Joint signals intelligence aircraft, the Army's and Marine Corps' tactical signals intelligence capabilities, and the Defense Intelligence Agency's analysts assigned to the theater joint intelligence operations centers.

MIP dollars are managed within the budgets of DOD organizations by component managers—such as the senior leader for the intelligence element of the U.S. Air Force (USAF/A2) who manages Air Force MIP dollars and the senior leader for the intelligence element of the U.S. Navy (USN/N2) who manages MIP dollars for the Navy—in accordance with USD(I) guidance and policy. MIP components include the Office of the Secretary of Defense; the intelligence elements of the military departments; the intelligence element of U.S. Special Operations Command (USSOCOM/J2); and military intelligence activities associated with DIA, NGA, NRO, and NSA. Some DOD intelligence components make use of both NIP and MIP funds. The directors of DIA, NGA, NRO, and NSA serve simultaneously as program managers for their NIP funds and component managers for their MIP funds.

Secrecy vs. Transparency

Most intelligence dollars are embedded in the defense budget for security purposes. All but the topline budget numbers are classified. Disclosure of details associated with the intelligence budget has been debated for many years, with proponents arguing for more accountability and IC leadership arguing that disclosure of such figures could damage national security. In 1999, then-DCI George Tenet articulated the potential risk of disclosure as follows:

Disclosure of the budget request reasonably could be expected to provide foreign governments with the United States' own assessment of its intelligence capabilities and weaknesses. The difference between the appropriation for one year and the Administration's budget request for the next provides a measure of the Administration's unique, critical assessment of its own intelligence programs. A requested budget decrease reflects a decision that existing intelligence programs are more than adequate to meet the national security needs of the United States. A requested budget increase reflects a decision that existing intelligence programs are insufficient to meet our national security needs. A budget request with no change in spending reflects a decision that existing programs are just adequate to meet our needs.

The 9/11 Commission agreed with critics who argued for more transparency but also found that disclosure of numbers below the topline could cause damage to national security. It recommended that the amount of money spent on national intelligence be released to the public:

[T]he top-line figure by itself provides little insight into U.S. intelligence sources and methods. The U.S. government readily provides copious information about spending on its military forces, including military intelligence. The intelligence community should not be subject to that much disclosure. But when even aggregate categorical numbers remain hidden, it is hard to judge priorities and foster accountability.

In response to the 9/11 Commission recommendations, Section 601(a) of P.L. 110-53 (codified at 50 U.S.C. Section 3306(b)) directs the DNI to disclose the NIP topline number:

Not later than 30 days after the end of each fiscal year beginning with fiscal year 2007, the Director of National Intelligence shall disclose to the public the aggregate amount of funds appropriated by Congress for the National Intelligence Program for such fiscal year.

Section 601(b) (codified at 50 U.S.C. Section 3306(c)(1)(A)) allows the President to "waive or postpone the disclosure" if the disclosure "would damage national security." The first such disclosure was made on October 30, 2007. The Intelligence Authorization Act (IAA) of 2010 ( P.L. 111-259 ) further amended Section 601 to require the President to publicly disclose the amount requested for the NIP for the next fiscal year "at the time the President submits to Congress the budget."

At the present time only the NIP topline figure must be disclosed based on a directive in statute. The DNI is not required to disclose any other information concerning the NIP budget, including whether the information concerns particular intelligence agencies or particular intelligence programs. In 2010, the Secretary of Defense began disclosing MIP appropriations figures on an annual basis and in 2011 disclosed those figures back to 2007. These actions have provided public access to previously classified budget numbers for national and military intelligence activities.

Trends in Intelligence Spending

Historical Trends

Figure 1 illustrates highs and lows in NIP spending between 1965 and 1994. Due to the classified nature of the intelligence budget at that time, the graphic does not include dollar figures. Figure 1 suggests that NIP spending declined steadily from about 1971 to 1980, climbed back to 1968 levels by about 1983, and steadied to fairly constant levels between 1985 and 1994. The pattern of spending in Figure 1 generally reflects world events and associated defense spending. Analyses of defense spending over the past several decades usually attribute higher levels of defense spending in the 1960s to the Vietnam War; lower levels of defense spending in the 1970s to the period of détente between the United States and the Soviet Union and to the worldwide economic recession; and higher levels of defense spending in the 1980s to the Reagan defense build-up. A graph depicting defense outlays between 1950 and 2017 is provided in Figure A-1 .

Recent Trends

Table 1 compares NIP and MIP spending to national defense spending from FY2007 to FY2019, reporting values in both nominal and constant dollars. Budget numbers appropriated for FY2013 show adjustments made in accordance with automatic spending cuts required under the Budget Control Act of 2011 ( P.L. 112-25 ). Topline numbers associated with national defense spending are reported in Table 1 and illustrated graphically in Figures 1 and 2 .

The nominal dollars in Table 1 suggest that the NIP topline steadily increased from FY2007 to FY2012. The MIP topline steadily increased from FY2007 to FY2010, then decreased from FY2011 to FY2015 before showing steady, yet small increases from FY2016 to the requested figures for FY2019. These NIP and MIP trends have changed the relative sizes of the NIP and MIP budgets. For example, of the $63.5 billion appropriated in FY2007, the NIP portion ($43.5 billion) was roughly twice the size of the MIP portion ($20 billion). In contrast, by FY2015 (and subsequently) the NIP was approximately three times larger than the MIP.

The constant dollars in Table 1 suggest that the NIP dollars appropriated in FY2017 ($56.7 billion) were roughly equal to the NIP dollars appropriated in FY2008 ($56.8 billion). The highest level of NIP spending, in constant dollars, was in FY2011 ($61.7 billion). In contrast, the MIP dollars appropriated in FY2017 ($19.1 billion) were significantly less than the MIP dollars appropriated in FY2007 ($24.6 billion). The highest level of MIP spending, in constant dollars, was in FY2009-FY2010 ($31.1 billion).

Figure 2 uses the data in Table 1 to provide an overview of total intelligence spending as a percentage of overall national defense spending. The almost flat percentage line suggests that annual intelligence spending has remained relatively constant over the past decade, consistently representing approximately 11% of annual national defense spending.

Figure 3 adds four additional NIP topline values—numbers available for FYs 1997, 1998, 2005, and 2006. The topline number for the NIP was classified until 2007, with two exceptions. In October 1997, then-DCI George Tenet announced that the intelligence budget for FY1997 was $26.6 billion, and in March 1998, DCI Tenet announced that the budget for FY1998 was $26.7 billion. In addition, IC officials retroactively declassified NIP topline numbers for FY2005 ($39.8 billion) and FY2006 ($40.9 billion). Nevertheless, corresponding MIP topline dollars for 1997, 1998, 2005, and 2006 are not publicly available. Figure 3 provides a snapshot of NIP spending over the past two decades, and despite the lack of data between 1999 and 2004, the values that are present suggest relative constancy in NIP topline dollar appropriations.

Issues for Congress

Transparency

Congress's and the American public's ability to oversee and understand how intelligence dollars are spent is limited by the secrecy that surrounds the intelligence budget process. DNI Daniel Coats has stated his commitment to transparency "as a foundational element of securing public trust in our endeavors." Many believe the IC could exercise greater transparency with respect to budgetary matters, however, and that disclosure of intelligence-related spending other than the topline number would not be harmful to national security.

In the 115 th Congress, legislation has again been introduced to address the issue of transparency and secrecy in the intelligence budgets, continuing efforts to require disclosure of the topline budget figure for each of the components of the intelligence community. H.R. 5406 , and a nearly identical bill, S. 2631 , both titled "Intelligence Budget Transparency Act of 2018," would require the President to disclose, in his annual budget request to Congress,

[T]he total dollar amount proposed in the budget for intelligence or intelligence related activities of each element of the Government engaged in such activities in the fiscal year for which the budget is submitted and the estimated appropriation required for each of the ensuing four fiscal years.

The bills were referred to the House and Senate Committees on the Budget, respectively. The 115 th Congress may consider reexamining the arguments, directives, and statute that currently guide disclosure of numbers associated with intelligence spending.

Questions for Congress

Some have asserted that America's intelligence agencies may spend more money on gathering and disseminating intelligence than the rest of the world's intelligence services put together. Is it enough? And, to what extent is the IC providing value for the money? As Congress considers the FY2019 NIP and MIP budgets, and balances the need to protect both national security and taxpayer dollars, coming to agreement with the executive branch on how much spending is enough lies at the heart of much of its oversight responsibility and power of the purse. The following types of questions may be considered:

Does the IC have the funding to develop or maintain collection capacity necessary to support national security policy? Does the IC have the funding necessary to develop the capacity for the timely processing and analysis of data? Is the IC organized or sufficiently integrated to realize efficiencies in the collection, processing, analysis and sharing of intelligence across its 17 components? Where can the IC accept risk relative to budget limitations? Is the IC postured to leverage international partners for coverage of emerging issues or areas where the IC has limited investment? Does the National Intelligence Priorities Framework (NIPF) process provide a useful means for prioritizing the allocation of resources? Does the Office of the Director of National Intelligence (ODNI) have the authority, funding, and organization to enable oversight of the impact of intelligence programs of IC components?

Appendix A. Defense Spending: FY1950-2017

Appendix B. Intelligence Programs (NIP and MIP)

Appendix C. Intelligence Community Entities Receiving NIP and MIP Funding

Six U.S. intelligence entities—those organizations with an intelligence mission that include but are not limited to the IC components defined by statute—have both MIP and NIP funding sources. The directors of DIA, NGA, NRO, and NSA serve as both Program Managers for their NIP funds and Component Managers for their MIP funds.

Appendix D. Intelligence Community Components

In statute, the IC comprises 17 component organizations, spread across six separate departments of the federal government, and two independent agencies. NIP spending is spread across all 17, while MIP spending is confined to the DOD.