Intelligence, Surveillance, and Reconnaissance (ISR) Programs: Issues for Congress

CRS Report for Congress
Intelligence, Surveillance, and
Reconnaissance (ISR) Programs:
Issues for Congress
Updated February 22, 2005
Richard A. Best, Jr.
Specialist in National Defense
Foreign Affairs, Defense, and Trade Division

Congressional Research Service ˜ The Library of Congress

Intelligence, Surveillance, and Reconnaissance (ISR)
Programs: Issues for Congress
Summary
Intelligence, surveillance, and reconnaissance (ISR) functions are principal
elements of U.S. defense capabilities, and include a wide variety of systems for
acquiring and processing information needed by national security decisionmakers and
military commanders. ISR systems range in size from hand-held devices to orbiting
satellites. Some collect basic information for a wide range of analytical products;
others are designed to acquire data for specific weapons systems. Some are
“national” systems intended primarily to collect information of interest to
Washington-area agencies; others are “tactical” systems intended to support military
commanders on the battlefield. Collectively, they account for a major portion of U.S.
intelligence spending that, according to media estimates, amounts to some $40 billion
annually.
For some time Congress has expressed concern about the costs and management
of ISR programs. With minor exceptions, ISR acquisition has been coordinated by
the Defense Department and the Intelligence Community. Although there are long-
existing staff mechanisms for reviewing and coordinating ISR programs in the
context of the annual budget submissions, many in Congress believe that existing
procedures have not avoided duplication of effort, excessive costs, and gaps in
coverage. Examples that some observers cite are separate efforts to acquire a new
generation of reconnaissance satellites and a high altitude unmanned aerial vehicle
(UAV) known as Global Hawk. Both systems acquire some of the same sorts of
information and serve similar customers, but they are acquired in distinctly different
ways; moreover, in both cases procurement efforts have been beset by increasing
costs and schedule delays.
Recently enacted statutes mandate better integration of ISR capabilities and
require that the Defense Department prepare a roadmap to guide the development and
integration of ISR capabilities over the next fifteen years. An effective roadmap, if
developed, could potentially ensure more comprehensive coverage of targets and save
considerable sums of money. To establish responsibility for an Intelligence
Community-wide effort, the 9/11 Commission recommended that a new position of
Director of National Intelligence be established to manage the national intelligence
program (but not joint military and tactical intelligence programs, which would
continue to be managed by the Defense Department). This position was included,
after extended debate, in the Intelligence Reform and Terrorism Prevention Act of
2004 (P.L. 108-458) that was approved by the President on December 17, 2004. The
implications of this legislation for ISR programs are as yet uncertain, but Congress
may seek to assess the effectiveness of the statute in addressing long-existing
concerns with ISR programs. This report will be updated as circumstances warrant.

Contents
In troduction ......................................................1
Congressional Concerns with ISR: Lack of Coordination...................2
Congressional Budget Justification Books (CBJBs)...................5
Supplemental Appropriations....................................7
Reprogramming Issues..........................................9
Momentum for Reorganization ..................................10
Multiple Types of ISR Programs.....................................12
NIP Programs Serve National Decisionmaking......................12
JMIP Programs Serve the Defense Department......................13
TIARA Programs Serve the Military Services.......................14
ISR Programming and Budgeting Procedures Differ Among Agencies.......15
Role of the DCI/DNI..........................................16
Role of the Secretary of Defense.................................17
Changes in DOD’s Management of ISR.......................18
How ISR Funding is Included in DOD’s Budget.................19
Internal DOD Coordinating Boards...........................20
Coordination Between DOD and the IC...........................20
Congressional Oversight of ISR Programs.........................21
Conclusion ......................................................22
Appendix A: A Case Study in ISR Acquisition: The Future Imagery
Architecture (FIA) and Global Hawk UAVs........................24

Intelligence, Surveillance, and
Reconnaissance Programs (ISR):
Issues for Congress
Introduction
The various systems that collect, process, and disseminate intelligence are
encompassed in the budget category known as Intelligence, Surveillance, and
Reconnaissance (ISR¹). ISR covers a multitude of programs ranging from billion-
dollar satellites to hand-held cameras. The bulk of funding is for research and
development (R&D) and procurement; personnel costs are comparatively low. Some
systems are used only by military units; others are national systems operated by
Washington-level defense agencies. Most are surrounded in secrecy, but total
spending on ISR, while difficult to estimate with unclassified information,
undoubtedly runs into the tens of billions of dollars. The ISR programs considered
in this report are managed by the Central Intelligence Agency (CIA) and by the large
intelligence agencies and components of the Department of Defense (DOD).²
ISR acquisition has in recent years come under strong criticism. Reportedly,
there are technical problems with the new generation of reconnaissance satellites,
along with billion dollar cost-overruns; only a small number of the planned high-
altitude UAVs are actually deployed; and there have been difficulties in ensuring that
the troops who need intelligence acquire it in a timely manner. There is a widespread
awareness that ISR spending, much greater than in past years, could easily absorb
even larger portions of defense and intelligence budgets, making the need for
tradeoffs even more important. Some observers point to the possibility that satellites
and UAVs potentially undertake the same or similar missions, but that the current
system gives little opportunity for cost comparisons or trade-offs to be made in the

¹ ISR as used in Defense Department documents refers to the sets of collection and
processing systems, and associated operations, involved in acquiring and analyzing
information about foreign countries. Intelligence is a more general term; surveillance refers
to systematic observation of a targeted area or group, usually over an extended time;
reconnaissance refers to an effort or a mission to acquire information about a target and can
mean a one-time endeavor. See U.S. Department of Defense, Department of Defense
Dictionary of Military and Associated Terms, Joint Publication 1-02, 12 April 2001. As
used in this Report, the term “intelligence systems” encompasses all ISR systems.
² The intelligence programs of the State, Justice (including the FBI), Energy, and Treasury
Departments have far fewer budgetary implications and will not be addressed herein. Many
of the activities of the Coast Guard, now part of the Department of Homeland Security
(DHS), have important intelligence implications, but only some are budgeted as intelligence
programs.

acquisition process. Appendix A provides a case study of the trade-offs between
satellites and unmanned aerial vehicles (UAVs).
Understanding the procedures for acquiring ISR systems is, however,
complicated by the fact that different ISR systems are acquired in entirely different
ways, by different intelligence agencies or military services, and are designed for
different users. In addition, the acquisition processes are overseen by different
congressional committees. It is difficult to ensure efficient acquisition in the separate
programs which are often based on innovative technologies. It is even more
challenging to envision a seamless and comprehensive system of systems and to
ensure the acquisition of an optimal mix of specific systems.
Congressional Concerns with ISR:
Lack of Coordination
Although procedures for coordinating the budgeting of ISR programs have long
been in place, some Members of Congress have concluded that the procedures have
not been wholly effective. There has been, it is argued, inadequate data to compare
systems capabilities and costs across the spectrum of intelligence programs, an
imbalance between collection and analysis programs, and an intelligence effort that
does not reflect an optimal allocation of extensive resources. Expressions of
congressional concern go back a number of years. In 1995, the Senate Select
Committee on Intelligence (SSCI) expressed its misgivings about existing
cooperation among agencies and recommended a joint review by the Director of
Central Intelligence (DCI) and the Deputy Secretary of Defense to ensure that “both
Intelligence Community and Defense Department equities are served in the planning,
programming, and management of all intelligence activities and programs.”³
Some believed that giving the DCI greater management responsibilities would
improve the management of ISR programs, including those in the Department of
Defense (DOD). Reflecting that view, the FY1997 Intelligence Authorization Act
(P.L. 104-293) included provisions that strengthened the ability of the DCI “to
manage the Intelligence Community by codifying his authority to participate in the
development of the budgets for defense-wide and tactical intelligence....”⁴ The
Conference Committee stated: “Giving the DCI a database of all intelligence
activities and requiring all National Foreign Intelligence Program (NFIP) elements⁵

³ U.S. Congress, Senate Select Committee on Intelligence, Authorizing Appropriations for
Fiscal Year 1996 for the Intelligence Activities of the United States Government and the^th^st
Central Intelligence Agency Retirement and Disability System 104 Congress, 1 session,,
S.Rept. 104-97, June 14, 1995, p. 4.
⁴ U.S. Congress, House Committee of Conference, Intelligence Authorization Act for Fiscal
Year 1997, 104^th Congress, 2d session, H.Rept. 104-832, September 24, 1996, p. 38.
⁵ There are three types of intelligence programs; NFIP (renamed the National Intelligence
Program (NIP) by the 2004 Intelligence Reform Act) includes the national programs that
support senior policymakers; the Joint Military Intelligence Program (JMIP) that provides
(continued...)

to submit periodic budget execution reports should enable the DCI to make better use
of his existing authorities — given to him by Congress in 1992 — to approve the
budgets of NFIP elements and to transfer funds and personnel with the concurrence
of affected agency heads. The conferees in considering the FY1997 legislation urged
the DCI to be more assertive in using these authorities.”⁶
In May 2000, the Senate Intelligence Committee reported that, “the budget
practices of the [Central Intelligence Agency (CIA)] and the Intelligence Community
as a whole are simply inadequate to address current requirements. Upper level
program managers lack sufficient insight into the process to make informed and
timely decisions regarding the allocation of funds, and to assure Congress, and
themselves, that funds are being spent as appropriated and authorized.”⁷
The next year the committee again argued that the Intelligence Community “is
handicapped by the lack of comprehensive strategic and performance plans that can
be used to articulate program goals, measure program performance, improve program
efficiency and aid in resource planning.” Accordingly, the Committee directed the
DCI to produce a “comprehensive Intelligence Community strategic plan and
performance plan, as well as complementary strategic and performance plans for the
intelligence agencies within the National Foreign Intelligence Program aggregation.”
The Committee asked that such plans be undertaken annually and made available to
congressional committees by March 1 of each year.⁸
In 2002, the Senate Intelligence Committee acknowledged receipt of the “first-
ever plans coordinated across the Intelligence Community aimed at establishing
performance measures aligned with the stated goals and priorities of the Director of
Central Intelligence.” The Committee went on, however, to indicate that further
work is needed and suggested that developing new systems merely to acquire a new
capability was insufficient; the capability had to meet validated intelligence needs.
“A key issue is the development of performance plans and measures that are not
focused solely on the attainment of intelligence capabilities but also on the value
received from such capabilities in pursuit of Intelligence Community missions.”⁹
Despite this admonition, the next year the Committee called attention to the
absence of a 2003 performance plan submission, even though the deadline had passed

⁵ (...continued)
support to officials throughout DOD; and Tactical Intelligence and Related Programs
(TIARA) that are designed to support a single military service. For further background, see
below, pp. 11-14.
⁶ Ibid., p. 39.
⁷ S.Rept. 106-279, p. 33.
⁸ S.Rept. 107-63, p. 17.
⁹ U.S. Congress, Senate Select Committee on Intelligence, To Authorize Appropriations for
Fiscal Year 2003 for Intelligence and Intelligence-Related Activities of the United States
Government, the Community Management Account, and the Central Intelligence Agency^th^nd
Retirement and Disability System, 107 Congress, 2 session, S.Rept. 107-149, May 9,

2002, p. 28.

with no request for an extension.¹⁰ More significantly, the Committee noted that it
is aware
of no capability within DoD or the Intelligence Community for objectively,
independently, and comprehensively evaluating alternative sensor and platform
architecture and capabilities. There are some capabilities within different
agencies and departments, but none that are available, independent of the
program offices, to model and assess cross-program trades without regard to the
location of the sensor or platform (air, space, land, or sea) or the level of
compartmentation. Consequently, although DoD and Intelligence Community
officials expend substantial effort and time evaluating program trades, they do
so without the benefit of the rigorous quantitative modeling necessary to
optimize collection capabilities and architectures. Given the vast sums involved
in these programs, even modest increases in the efficiency of resources allocation
could lead to substantial benefits. Further, the Committee notes that the national
military strategy, as well as the Defense Planning Guidance, have been
developed in recent years without the participation of the Director of Central
Intelligence or his staff, notwithstanding the growing importance of intelligence
to military operations and the need to build forces commensurate to validated¹¹
threats.
Section 355 of the FY2004 Intelligence Authorization Act (P.L. 108-177) required
a report from the DCI and the Secretary of Defense assessing progress in the
development of “a comprehensive and uniform analytical capability to assess the
utility and advisability of various sensor and platform architectures and capabilities
for the collection of intelligence ... [and] the improvement of coordination between
the Department [of Defense] and the intelligence community on strategic and
budgetary planning.

¹⁰ U.S. Congress, Senate Select Committee on Intelligence, Authorizing Appropriations for
Fiscal Year 2004 for Intelligence and Intelligence-Related Activities of the United States
Government, the Community Management Account, and the Central Intelligence Agency^th^st
Retirement and Disability System, 108 Congress, 1 session, S.Rept. 108-44, May 8, 2003,
pp. 12-13.
¹¹ Ibid., p. 13. Furthermore, the Committee complained that the National Security Agency
(NSA), a major intelligence agency, had been unable to provide basic information about its
acquisition efforts:
It is very difficult for the Committee to understand what needs to be done
to modernize NSA when NSA cannot provide an adequate baseline of ongoing
development and acquisition programs, projects, and activities....
The Committee has fenced funds over the past two fiscal years to try to bring
command attention to this problem. Submissions to date have shown progress,
but are not comprehensive in identifying known projects and programs that are
being funded in the CCP.... Future funding requests will be balanced against the
NSA acquisition baseline so it is in the agency’s best interest to get this done
right, and soon. Ibid., p. 17.

In separate legislation, Congress also urged that DOD take a greater role in
managing ISR; in section 923 of the FY2004 Defense Authorization Act (P.L. 108-

136) Congress found that:

... there is not currently a well-defined forum through which the integrators of
intelligence, surveillance, and reconnaissance capabilities for each of the Armed
Forces can routinely interact with each other and with senior representatives of
Department of Defense intelligence agencies, as well as with other members of
the intelligence community, to ensure unity of effort and to preclude unnecessary¹²
duplication of effort.
P.L. 108-136 further stated that the existing structure of intelligence programming
may not be the best approach for supporting the development of an intelligence,
surveillance, and reconnaissance structure that is integrated to meet the national^st
security requirements of the United States in the 21 century.
Accordingly, the FY2004 Defense Authorization Act directed the Under Secretary
of Defense for Intelligence to establish an “ISR Integration Council” to provide a
permanent forum for assessing ISR capabilities. The council is to consist of senior
intelligence officers of the services, the Special Operations Command, the Joint Staff,
and the directors of DOD intelligence agencies. The DCI would be “invited” to
participate. The council would be charged with developing a comprehensive
roadmap “to guide the development and integration” of DOD ISR capabilities for 15¹³
years.
In addition to its general concerns about ISR programs, some Members of
Congress have specifically focused on two issues related to budget processes that
they argued undermine their abilities to conduct oversight of ISR efforts. They argue
that congressional budget justification books have been inadequate, and that there has
been an over-reliance on supplemental appropriations to fund continuing ISR
programs.
Congressional Budget Justification Books (CBJBs)
Effective congressional oversight depends on accurate, consistent information
over a multi-year period; the House Permanent Select Committee on Intelligence

¹² The accompanying committee report noted that the U.S. has “ the most capable ISR
system in the world” but “as good as this system is, however, it is often plagued by gaps,
competition for assets, unavailability at the required level, and parallel systems (so-called
‘stovepipes’) that do not fully complement one another.... the Department has continued to
develop some capabilities without regard to their place within an overarching ISR
architecture.” U.S. Congress, Senate Committee on Armed Services, National Defense^th^st
Authorization Act for Fiscal Year 2004, 108 Congress, 1 session, S.Rept. 108-46, May 13,

2003, p. 355.

¹³ Section 923, P.L. 108-136; on April 7, 2004, the Senate Armed Services was informed
that the Council had recently started meeting. Testimony of Stephen Cambone,
Undersecretary of Defense for Intelligence before the Senate Armed Services Committee,
April 7, 2004.

(HPSCI), in particular, has criticized the inadequacy of intelligence budget
justification materials and asked for more complete budgetary submissions in the
form of congressional budget justification books. Proposals for ISR programs are to
be forwarded to intelligence committees along with armed services and
appropriations committees. Justification materials on national programs are
submitted to the two intelligence committees along with classified CBJBs, which
include one volume for each NIP program plus an additional summary volume. The
classified books, available to Members and committee staff, include explanatory
narrative and resource displays for all resources requested by the program. Also
included are descriptions of base levels of efforts, ongoing initiatives and new
initiatives with associated resource displays. CBJBs are submitted to Congress
within a few weeks of the delivery of the budget in early February and form the basis
for the committees’ review of the entire NIP prior to the drafting of annual
intelligence authorization bills. Once the intelligence committees complete their
review — generally in the spring and early summer — the legislation is referred to
the armed services committee which have the option of submitting a separate report
prior to floor consideration.
Classified budget justification books, provided by the Administration to
Congress, are the primary ways, in addition to oral testimony, by which Congress
obtains information about intelligence programs. In 1997 HPSCI criticized
justification books for lacking “several critical components necessary for the
Committee to ensure proper alignment of funding within the funding appropriations
categories. Clear identification of each project; its specific budget request numbers;
the appropriation category (e.g., Other Procurement, Defense-wide; RDT&E, Navy,
etc.); the budget request line number, and if a research and development project, the
Program Element number [are] essential to this task.... Therefore, the Committee
directs the CMS [Community Management Staff] and the Defense Department to
provide this specific data in all future budget justification documents.”¹⁴
In 2000, HPSCI expressed its continued frustration with a perceived lack of
detail provided in justification books (which are classified) and strongly criticized
financial management practices at some NFIP agencies. HPSCI stated that:

¹⁴ U.S. Congress, House Permanent Select Committee on Intelligence, Intelligence
Authorization Act for Fiscal Year 1998, 105^th Congress, 1^st session, H.Rept. 105-135, Part
1, June 18, 1997, p. 64. The subsequent Conference Report noted that the CMS was then
in the process of revising the structure of the CBJBs and deferred the provision pending the
outcome of CMS efforts; see U.S. Congress, House Committee of Conference, Intelligence^th^st
Authorization Act for Fiscal Year 1998, 105 Congress, 1 session, H.Rept. 105-350,
October 28, 1997, p. 30. In the same year, House Committee on National Security, also
concerned that all costs of all aspects of programs were not being identified, directed that
future CBJBs show “all direct and associated costs, in each budget category (e.g.,
procurement, research and development, operations and maintenance, military construction,
etc.)....” U.S. Congress, House Committee on National Security, National Defense^th^st
Authorization Act for Fiscal Year 1998, 105 Congress, 1 session, H.Rept. 105-132, June
16, 1997, p. 304. A year later, HPSCI noted good progress by the IC in preparing
submissions for FY1999, but asked for additional data. H.Rept. 105-508, p. 16.

... the NFIP agencies need greater insight into their financial obligations and the
capabilities that they are developing. NSA’s baseline activity, for example,
identified many areas of duplicative development, as well as lack of investment
in key strategic areas. Yet, due to the lack of detail, the CBJB did not provide
this information. The Committee notes that, at least at some agencies, internal¹⁵
financial management practices seriously complicate this process....
In 2003, HPSCI again called attention to limitations in the data included in
CBJBs which is often less extensive than that routinely provided in DOD budget
materials:
The Committee believes, for example, that acquisition program details in the
CBJBs should include major milestones and deliverables for contracted projects
for the entire length of a contract and contain more specificity for the budget year
of the request. Many of the project milestones in the CBJBs are, however, at
such a high-level that the Committee is unable to determine the stage of the
development activity or what will be accomplished in the coming year. The
project descriptions are often so vague that the Committee is unable to determine¹⁶
the value of, or even what is being developed.
Supplemental Appropriations
While procedures for annual budget submissions have long been established,
there has been an increasing practice in recent years, and especially since the
September 11, 2001 attacks, of providing intelligence funding in supplemental¹⁷
appropriations acts. Of the $165.6 billion in supplemental appropriations that the
Defense Department has received since September 2001, a significant, but not
publicly identified, portion of these sums — at least $16 billion (not counting funds
received in the FY2004 Iraq supplemental) — was directed at intelligence and¹⁸
intelligence-related activities.

¹⁵ H.Rept. 106-620, p. 24.
¹⁶ H.Rept. 108-163, p. 25.
¹⁷ Section 504(a)(1) of the National Security Act requires that funds for intelligence
activities be “specifically authorized by the Congress.” Intelligence authorization acts
(including their classified annexes) provide specific authorization, although appropriations
acts also usually have generalized language providing specific authorization to meet the
504(a)(1) requirement. (The inclusion of such provisions in appropriations acts serves as
authorization until authorization bills are enacted or in the absence of authorization bills, as
often occurs when supplemental appropriations bills are enacted.) Even when authorization
legislation is under consideration the two appropriations committees also review intelligence
budget submissions, and intelligence funds for most intelligence activities are included in
annual defense appropriation bills. Supplemental appropriations that fund intelligence
activities include an authorizing provision to comply with section 504 of the National
Security Act, but they are not reported by the two intelligence committees.
¹⁸ During floor consideration of the FY2004 intelligence authorization bill, Representative
Hastings, a member of HPSCI, stated: “it is important to note that this bill authorizes only
part of the operating funds for the intelligence community. A huge portion of intelligence
funds were provided in the $87 billion Iraqi counterterrorism supplemental and in the
(continued...)

Arguably, there is less opportunity for consideration of proposed supplemental
intelligence spending within the context of established programs. The HPSCI noted
in July 2002:
The “advantage” of the supplemental process to the Intelligence Community is
that pressing budgetary demands can be met in a shorter time (and with fewer
bureaucratic hurdles) than the regular yearly process. However, by continuing
to rely on supplemental appropriations year after year, the Intelligence
Community risks fostering a budget process that is ripe for abuse and long-term
funding gaps.
The House Committee also argued that the Defense Emergency Response Fund
(DERF) (a funding initiative that permits DOD to shift funds from a central fund to
specific appropriations accounts after enactment as required for counterterrorist
operations) “has turned into just another vehicle to fund items that the Intelligence¹⁹
Community did not get through the regular budget and planning process.” In
particular, it is argued, supplemental legislation can undercut established budgeting
and congressional oversight procedures making it more difficult to weigh trade-offs
and adjust overall priorities. It can, in some situations, lead to the launching of
programs that are unlikely to be sustained in the regular authorization and
appropriation process.
Some question the propriety of funding “core” programs in emergency
supplemental legislation which are intended to provide for additional unforeseen
needs resulting from combat and occupation duties. In June 2003, HPSCI reiterated
its concerns, regretting that “core mission and core mission support programs have
also been funded in supplemental appropriations.” It argued that, “The repeated
reliance on supplemental appropriations has an erosive negative effect on planning,
and impedes long-term, strategic planning. The Committee hopes that the IC has
finally reached a plateau of resources and capabilities on which long-term strategic
planning can now begin.”
Further, HPSCI concluded:
The Committee cannot help but note that budgeting by supplemental
consequentially limits congressional oversight. The Committee strongly believes
that the health of the IC is directly related to the oversight from Congress it
receives. Certainly, the confidence of the American people activities, and
programs of the IC is increased significantly as a result of the transparency that²⁰
exists between the IC and its congressional overseers.
Concern in not limited to the House Committee. In its report on a FY2005
Intelligence Authorization bill (S. 2386) the Senate Intelligence Committee argued,

¹⁸ (...continued)
supplementals that proceeded it.” Congressional Record, November 20, 2003, p. H11674.
¹⁹ U.S. Congress, House Permanent Select Committee on Intelligence, Intelligence
Authorization Act for Fiscal Year 2003, 107^th Congress, 2^nd session, H.Rept. 107-592, July

18, 2002, p. 15.

²⁰ H.Rept. 108-163, p. 22.

“While the practice of funding baseline expenditures using supplemental vehicles has
become more prevalent in the past 10 years, ... it is time to rein in this practice.”²¹
Reprogramming Issues
A concern for some observers of the Intelligence Community are the current
procedures for reprogramming of previously appropriated funds. Reprogrammings
are intended to permit shifting funds to meet unanticipated new requirements that
arise during the course the year. The National Security Act permitted the DCI to
transfer funds appropriated for one program within NIP to another program within
the NIP, but there were congressional concerns that reprogramming procedures did
not invariably met statutory requirements.²² In May 2000, the House Intelligence
Committee complained about “significant and deleterious movements of money”
from field stations to CIA Headquarters that were inconsistent with National Security
Act provisions and asked the CIA Inspector General to investigate whether statutory
provisions were being followed.²³ Similar concerns were expressed by the Senate
Intelligence Committee: “Recent actions, including taxing directorates for funds to
be used in other areas, and moving funds within expenditure centers without
congressional notification, have eroded this Committee’s confidence that
appropriations are used as intended.”²⁴ During floor consideration of the FY2004
intelligence authorization conference report, Senator Roberts, Chairman of the Senate
Intelligence Committee, commented on “difficulties in the out years as the National
Foreign Intelligence Program becomes burdened with content that is more costly than
the budgeted funding. This underestimation of future costs has resulted in significant
re-shuffling of NFIP funds to meet emerging shortfalls.”²⁵
Congress also criticized the process for reprogramming funds between NFIP
programs and non-NFIP programs. In May 2002, the Senate Intelligence Committee
expressed concern that “the correspondence it receives notifying it of the

²¹ U.S. Congress, Senate Select Committee on Intelligence, To Authorize Appropriations for
Fiscal Year 2005 for Intelligence and Intelligence-Related Activities of the United States
Government, the Intelligence Community Management Account, and the Central^th^nd
Intelligence Agency Retirement and Disability System, 108 Congress, 2 session, S.Rept.

108-258, May 5, 2004, p. 10.

²² 50 USC 403-4 required that transfers be approved by the Director of the Office of
Management and Budget, the receiving intelligence activity must be of a higher priority than
the one from which funds were taken, the transfer must be based on unforeseen
requirements, and the head of the department from which funds are to be transferred must
not object. In addition, appropriate congressional committees had to be notified.
Procedures for reprogramming and transfers, while seemingly esoteric, are designed to
ensure that congressional directions are followed in the expenditure of funds.
²³ H.Rept. 106-620, p. 25.
²⁴ U.S. Congress, Senate Select Committee on Intelligence, Authorizing Appropriations for
Fiscal Year 2001 for the Intelligence Activities of the United States Government and the^th^nd
Central Intelligence Agency Retirement and Disability System, 106 Congress, 2 session,
S.Rept. 106-279, May 4, 2000, p. 33.
²⁵ Congressional Record, November 21, 2003, pp.S15354-15355.

reprogramming of funds from one activity to another often does not set forth clearly
how the ... requirements of ‘higher priority’ and ‘unforeseen’ circumstances have
been satisfied.” Section 305 of the FY2003 Intelligence Authorization Act “clarifies
the ‘unforeseen’ requirement by stating that such a requirement does not include the
failure of the Director of Central Intelligence to anticipate an action by Congress,
such as an authorization or appropriation level lower than that requested in the
President’s budget.”²⁶ The provision was not, however, included in the version of the
bill that was enacted as P.L. 107-306. Section 311 of the Senate version of the
FTY2004 intelligence authorization bill would have deleted the “unforeseen
requirements” criterion altogether, but the provision was not adopted in conference.
Momentum for Reorganization
Given the congressional concerns indicated above, a number of Members and
outside observers have argued that a major restructuring of the Intelligence
Community would be required if certain challenges in ISR efforts are to be addressed
effectively. The 2002 Joint Inquiry conducted by the two intelligence committees to
review the background of the 9/11 attacks recommended the establishment of a
position of Director of National Intelligence who would have “the full range of
management, budgetary and personnel requirements needed to make the entire U.S.
Intelligence Community operate as a coherent whole.”²⁷ The National Commission
on Terrorist Attacks Upon the United States (the 9/11 Commission) also
recommended establishing a position of National Intelligence Director (NID) to
oversee national programs, but not joint military or tactical intelligence programs
which would managed solely by DOD. Furthermore, a senior Intelligence
Community official, Larry Kindsvater, the DCI’s Executive Director for Intelligence
Community Affairs and subsequently Deputy DCI for Community Management,
argued the need to reorganize the Intelligence Community, and proposed, among
other things, to give the DCI authority to transfer funding across agencies with
congressional approval.²⁸
The publication of the 9/11 Commission’s report in July 2004 provided the
impetus for congressional action in an election year. The 9/11 Commission’s
recommendations regarding the role of the new DNI appear to have been based
primarily on the perceived inability of the DCI to ensure interagency communications
and effectively control the allocation of intelligence assets. The Commission noted

²⁶ U.S. Congress, Senate, To Authorize Appropriations for Fiscal Year 2003 for Intelligence
and Intelligence-Related Activities of the United States Government, the Community
Management Account, and the Central Intelligence Agency Retirement and Disability^th^nd
System, 107 Congress, 2 session, S.Rept. 107-149, May 9, 2002, p. 9.
²⁷ Recommendations of the Final Report of the Senate Select Committee on Intelligence and
the House Permanent Select Committee on Intelligence Joint Inquiry into the Terrorist
Attacks of September 11, 2001, December 10, 2002, p. 1.
²⁸ Larry C. Kindsvater, “The Need to Reorganize the Intelligence Community,” Studies in
Intelligence, vol. 47, no. 1, 2003. This recommendation was echoed by former DCI Robert
Gates, “How Not to Reform Intelligence,” Wall Street Journal, September 3, 2003, p. A16;
see also, Richard Lardner, “Is the DNI DOA? Push for Intelligence ‘Czar’ Faces Major
Obstacles,” Inside the Pentagon, October 9, 2003, p. 1.

that DCI Tenet was reported to have placed the Intelligence Community “at war”
with Al Qaeda in December 1998, but without being able to ensure that all agencies
concentrated significant resources on the terrorist group.²⁹ The Commission also
noted efforts in the 1990s to address the DCI’s perceived lack of personnel and
budget authority over intelligence agencies. It further pointed out the results of
intelligence reorganization legislation introduced in the 1996:
The Department of Defense and its congressional authorizing committees rose
in opposition to the proposed changes. The President and the DCI did not
actively support these changes. Relatively small changes made in 1996 gave the
DCI consultative authority and created a new deputy for management and
assistant DCIs for collection and analysis. The reforms occurred only after the
Senate Select Committee on Intelligence took the unprecedented step of
threatening to bring down the defense authorization bill. Indeed, rather than
increasing the DCI’s authorities over national intelligence, the 1990s witnessed
movement in the opposite direction through, for example, the transfer of the
CIA’s imaging analysis capability to the new imagery and mapping agency³⁰
created within the Department of Defense.
Nevertheless, as former Representative Hamilton, the Vice Chairman of the 9/11
Commission testified:
I do not recall us finding a failure of a DOD agency, so far as we know. But we
certainly think that part of the problem has been an unwillingness to share the³¹
information that a number of agencies had.
Although some observers argued that the “wall” separating intelligence and law
enforcement agencies may have been a primary reason for the unwillingness to share
information and that the wall had been effectively removed by the USA Patriot Act
of October 2001 (P.L. 107-56), the recommendation of the 9/11 Commission to
establish a DNI with stronger oversight and management responsibilities for all
intelligence agencies (including components of law enforcement agencies) was
ultimately accepted by both the Bush Administration and the Congress.
As described below, the Intelligence Reform Act provides the DNI with
important statutory authorities in the intelligence budget process. It also enhances
the reprogramming authorities of the DNI; the DNI may transfer or reprogram funds
within the National Intelligence Program with the approval of the Director of the
Office of Management and Budget, after consultation with heads of department
affected, and subject to provisions in annual appropriations acts. In addition, the
funds must be transferred to an activity that is a higher priority intelligence activity,
that supports an emergent need or improves program effectiveness. The transfer or
reprogramming out of any department or agency in a single fiscal year must be less
than $150 million or 5% of the amounts available to the department or agency from

²⁹ 9/11 Commission Report, p. 357.
³⁰ Ibid., p. 104.
³¹ Testimony of Lee Hamilton, Vice Chairman of the 9/11 Commission to the House Armed
Services Committee, August 10, 2004.

the National Intelligence Program. These limitations do not apply if the transfer has
the concurrence of the department or agency head involved.
Multiple Types of ISR Programs
One argument that has been used by those who have proposed a major
reorganization of intelligence programming and budgeting is that the different
categories of intelligence programs are obsolete in today’s complex technological and
threat environment. ISR programs are currently grouped into three major categories
— the National Intelligence Program (NIP), the Joint Military Intelligence Program
(JMIP), and Tactical Intelligence and Related Activities (TIARA).³² The three
categories of intelligence activities used in programming and budgeting are based on
the different consumer being served, different management arrangements, and³³
different oversight in Congress.
NIP Programs Serve National Decisionmaking
The NIP (formerly, NFIP) is defined in statute as:
All programs, projects, and activities of the intelligence community, as well as
any other programs of the intelligence community designated jointly by the
Director of Central Intelligence and the head of a United States department or
agency or by the President. Such term does not include programs, projects, or
activities of the military departments to acquire intelligence solely for the
planning and conduct of tactical military operations by United States Armed³⁴
Forces.
The NIP is usually described as consisting of programs to support national
decisionmakers, especially the President, the National Security Council (NSC) staff,
and heads of cabinet departments, especially the Secretaries of State and Defense.
Major NIP programs include:
^!Central Intelligence Agency Program (CIAP)
^!General Defense Intelligence Program (GDIP)
^!Consolidated Cryptologic Program (CCP)

³² NIP is defined by statute (50 USC 401a(6)); the National Security Act refers to JMIP and
TIARA (50 USC 403-3(c)(1)). The U.S. Government collects vast quantities of other data
— including the reports of diplomats, information gathered by non-intelligence components
of the military services, open source materials, and economic statistics — that are of great
importance to policy makers, military leaders, and to intelligence analysts, but such
collection is not undertaken by intelligence agencies and is not included in intelligence
budgets.
³³ Intelligence spending totals remain classified (although appropriations levels for FY1997
($26.6 billion) and FY1998 ($26.7 billion) were made public). It should be understood that
other DOD accounts, unrelated to intelligence efforts, are also classified.
³⁴ 50 USC 401a(6).

^!National Geospatial-Intelligence Program [formerly the National
Imagery and Mapping Agency Program (NIMAP)]
^!National Reconnaissance Program (NRP)
^!DOD Foreign Counterintelligence Program³⁵ (FCIP)
NIP encompasses more than half of overall intelligence spending and includes
most efforts of the Intelligence Community (IC) — the CIA, the Defense Intelligence
Agency (DIA), the National Reconnaissance Office (NRO), the National Geospatial-
Intelligence Agency (NGA) [formerly the National Imagery and Mapping Agency
(NIMA)], and the National Security Agency (NSA). In accordance with the
Intelligence Reform Act, the DNI has overall responsibility for preparing NIP budget
submissions based on priorities established by the President and taking into account
input from DOD agencies that have NIP responsibilities. NIP budget totals are
authorized in annual intelligence authorization acts; total amounts are specified in the
classified schedule that accompany appropriations legislation, but are not made
public.³⁶
JMIP Programs Serve the Defense Department
The JMIP was established in 1995 to include defense-wide efforts that provide
support to multiple defense consumers. There are four principal components to the
JMIP:
^!the Defense Cryptologic Program designed to provide cryptologic
support to military commands;
^!the Defense Imagery Program designed to provide imagery support
to military commands;
^!the Defense Mapping, Charting, and Geodesy Program;
^!the Defense General Intelligence and Applications Program that
includes sub-programs managed by DIA and other agencies in
support of DOD commands.³⁷
In its report on the FY2001 Intelligence Authorization act, the House Intelligence
Committee described a number of JMIP programs in the year 2000, including

³⁵ U.S., Defense Intelligence Agency, Joint Military Intelligence Training Center,
Intelligence Resource Manager’s Guide, 1997 ed., p. 44.
³⁶ Funding for two small NIP programs, the Community Management Account (which funds
community-wide coordination efforts) and the CIA Retirement and Disability System
accounts is, however, made public.
³⁷ U.S. Congress, 104^th Congress, 1^st session, House of Representatives, Permanent Select
Committee on Intelligence, Intelligence Authorization Act for Fiscal Year 1996, H.Rept.

104-138, Part 1, June 14, 1995, pp. 10-11.

modifications to reconnaissance aircraft, Global Hawk UAVs, and antenna systems
for reconnaissance aircraft.³⁸
TIARA Programs Serve the Military Services
TIARA programs are “a diverse array of reconnaissance and target acquisition
programs that are a functional part of the basic military force structure and provide
direct information support to military operations.”³⁹ In the year 2000 the House
Intelligence Committee described a number of TIARA programs — cryptologic and
language skills training for the Army, an Army ground station to use with the
JSTARS aircraft, funds for extending naval space surveillance, hyper spectral sensing
systems on Air Force UAVs, and a tactical video system for Special Operations
Forces.⁴⁰ An annual list of TIARA programs is not published, although some are
indicated in appropriations reports.⁴¹ Unlike JMIP programs which tend to be
completely intelligence systems, TIARA includes “related activities,” systems that
are essentially parts of various weapons systems (and that can be reclassified out of
TIARA).
Over a number of years it has become apparent that, to consumers of
intelligence, distinctions among NIP, JMIP, and TIARA programs are becoming
indistinct. As the Intelligence Resource Manager’s Guide noted, “As systems grow
in complexity and capability and methods become more sophisticated, increasing
numbers of intelligence assets are capable of simultaneously serving both national
and tactical purposes.”⁴² For example, there has been for a number of years a
program, known as Tactical Exploitation of National Capabilities (TENCAP), which
is designed to facilitate the use of satellite imagery and other NIP products by
military commanders. In some military engagements with important diplomatic and
political implications, low-level tactical intelligence acquired through TIARA
systems is also desired by senior officials to support their efforts at crisis
management. In August 2004 testimony, Under Secretary of Defense for Intelligence
Stephen Cambone stated, in response to a question about the existence of a clear line
between national and tactical intelligence:

³⁸ U.S. Congress, House Permanent Select Committee on Intelligence, Intelligence
Authorization Act for Fiscal Year 2001, 106^th Congress, 2^nd session, H.Rept. 106-620, May

16, 2000.

³⁹ U.S. Congress, House Permanent Select Committee on Intelligence, Intelligence
Authorization Act for Fiscal Year 2004, 108^th Congress, 1^st session, H.Rept. 108-163, June

18, 2003, p. 16.

⁴⁰ H.Rept. 106-620, pp. 35-39.
⁴¹ See, for example, U.S. Congress, Senate Committee on Appropriations, Department of
Defense Appropriations Bill, 2004, 108^th Congress, 1^st session, S.Rept. 108-87, July 10,
2003. TIARA programs include equipment for the Army’s All Source Analysis System
(ASAS) — a mobile computer-assisted processing, analysis, fusion, dissemination and
presentation system, as well as a tactical UAV. Pp. 71-72.
⁴² Intelligence Resource Manager’s Guide, p. 67.

... an irony of this, sir, is that we spent a good deal of time, at least during my
tenure, trying to merge and blur the line and distinction between what is strategic
and tactical and what is national and military, since it’s increasingly difficult to
distinguish either in the product that is produced or in the capability that is
applied. So Global Hawks, which are built by the Air Force, are as significant
and important as SIGINT satellites that are built by the National Reconnaissance⁴³
Office and whose take is managed by the National Security Agency.
As a result, some observers argued that the three categories of ISR programs
cannot be meaningfully considered by themselves; they must be considered as parts
of a greater whole and, accordingly, the NIP, JMIP, and TIARA categories are
outmoded. Changing the statutes, regulations, and rules which established the three
categories obviously would be difficult and would affect organizational relationships
in both executive and legislative branches. One result of abolishing the system could
mean a devolution of acquisition to a multitude of program managers throughout the
military services — an approach that most observers would argue could have major
drawbacks.
Some have suggested that the growing interrelationships among NIP, JMIP, and
TIARA systems may complicate provisions in the Intelligence Reform Act that
establish separate responsibilities for NIP on one hand and JMIP and TIARA on the
other. Arguably, the act could complicate, rather than facilitate, effort to coordinate
the acquisition and operation of ISR systems. A major challenge for the Office of the
DNI, when activated, will be to coordinate ISR programs within the NIP for which
it is primarily responsible with those that are in JMIP and TIARA for which the
Defense Department has primary responsibility. The same types of coordinative
mechanisms that have long existed will undoubtedly continue to be required. In any
event, Congress will have a major influence on ISR acquisition; it may also choose
to determine whether the enhanced authorities of the DNI (in comparison to those of
the DCI) permit more effective coordination of ISR programs.
ISR Programming and Budgeting Procedures
Differ Among Agencies
Programming and budgeting of ISR systems have been managed by the
Department of Defense (DOD) and its many components, and by the Intelligence
Community (through the office responsible to the DCI for inter-agency coordination,
the Community Management Staff (CMS)). The Office of Management and Budget
(OMB) also plays a critical role in allocating budgetary goals that can constrain
intelligence spending proposals. Congressional responsibilities are spread among
armed services, intelligence, appropriations, and other committees. Although it
would be easy to question the number of entities involved, the reality is that the
overlap results from the evolution of a multiplicity of systems and the variety of
consumers. Whereas NASA can singlehandedly manage a moon probe, no
intelligence agency will ordinarily by itself collect, analyze, and disseminate finished

⁴³ Stephen A. Cambone, Undersecretary of Defense for Intelligence, testimony before House
Armed Services Committee, August 11, 2004.

intelligence. Different procedures used for different ISR systems by different
agencies can also complicate efforts to achieve compatibility and maximize
effectiveness.
Role of the DCI/DNI
Prior to passage of the Intelligence Reform Act, the DCI was responsible for
facilitating the development of an annual budget for intelligence and intelligence-
related activities and for presenting to the President an annual budget for the NFIP.
He participated in the development by the Secretary of Defense of the annual budgets
for JMIP and TIARA. Observers have argued that these responsibilities did not
provide for the comprehensive management of ISR programs that is needed.
Although the 9/11 Commission did not focus at length on the role of the DCI in
systems acquisition, it concluded that there was an urgent need to restructure the
Intelligence Community and establish stronger authorities for the DCI or a DNI.⁴⁴
Consideration of intelligence reform legislation in the 108^th Congress included
extensive debate on the role of the new DNI in developing budgets and overseeing
their execution. On one side was a determination to ensure that the DNI would be
effectively in charge of the entire Intelligence Community and able to direct its
resources at the most critical threats. On the other was a determination to ensure that
the combat support agencies of the Department of Defense would not be diverted by
non-DOD officials.
The language incorporated in the final version that became law requires that the
DNI provide, based on priorities set by the President, guidance to departments and
agencies regarding their portion of the National Intelligence Program. Then, based
on budget proposals provided by agency and department heads, the DNI is to develop
and determine the annual NIP budget. Funds appropriated by Congress are to be
apportioned by the OMB “at the exclusive direction of the Director of National
Intelligence.” Furthermore, “[d]epartment comptrollers or appropriate budget
execution officers shall allot, allocate, reprogram, or transfer funds appropriated for
the National Intelligence Program in an expeditious manner.”⁴⁵
The legislation did not, however, repeal statutory authorities of the Secretary of
Defense for managing the components of DOD. In addition, Section 1018 requires
that the President issue guidelines to ensure the effective implementation and
execution of the DNI’s authorities “in a manner that respects and does not abrogate
the statutory responsibilities of the heads” of other departments. Some believe that
this provision reflects separate, even conflicting priorities and suggest that it may be
as difficult to write the guidelines as it was to draft the legislation.
Much of the media analysis of this question tends to focus on a “turf battle” and
differences among key officials. Although elements of individual and bureaucratic
competition are inevitable, the underlying reality is that intelligence systems must

⁴⁴ See 9/11 Commission Report, pp. 407-416.
⁴⁵ P.L. 108-458, Section 1011.

support different sets of consumers; no serious observers suggest that duplicate
systems could be available in the foreseeable future. Priorities in acquisition of new
systems and in tasking collection must be set and the mechanisms of coordination
will inevitably be subject to different, but legitimate, requirements of different
agencies and policymakers.
In recent years, the CIA budget — the only part of the NIP that has been
managed solely by the DCI — is comprised mainly of personnel expenses — the
salaries of case officers, assets, analysts, managers, etc. along with associated costs
for equipment, buildings and grounds. In the past, the CIA was also involved in
significant procurement efforts such as reconnaissance satellites, manned aircraft
such as the U-2, and UAVs⁴⁶. The CIA Program is managed by the Executive
Director of the CIA, a senior staff official at CIA; other agencies play a relatively
minor role in CIA acquisition efforts.
Role of the Secretary of Defense
The Secretary of Defense has had a major role in developing programs to
address DOD’s intelligence needs and in managing most NIP programs. The
National Security Act assigns to the Secretary of Defense the responsibility to ensure,
in consultation with the DCI, that:
(1) the budgets of the elements of the intelligence community within the
Department of Defense are adequate to satisfy the overall intelligence needs of
the Department of Defense, including the needs of the chairman of the Joint
Chiefs of Staff and the commanders of the unified and specified commands and,
wherever such elements are performing government-wide functions, the needs
of other departments and agencies;
(2) ensure appropriate implementation of the policies and resource decisions of
the Director of Central Intelligence by elements of the Department of Defense
within the National Foreign Intelligence Program;
(3) ensure that the tactical intelligence activities of the Department of Defense
complement and are compatible with intelligence activities under the National⁴⁷
Foreign Intelligence Program....
Executive Order (EO) 12333, United States Intelligence Activities, required that
the DCI, together with the Secretary of Defense, “ensure that there is no unnecessary
overlap between national foreign intelligence programs and Department of Defense
intelligence programs....”⁴⁸ There have been, in addition, a number of inter-agency

⁴⁶ In recent years, such procurement has been the responsibility of DOD agencies, but in the
first months of the George W. Bush Administration there was considerable discussion of
Predator UAV acquisition that is carefully documented in the 9/11 Commission Report. See
U.S., National Commission on Terrorist Attacks Upon the United States, The 9/11
Commission Report, July 2004, pp. 210-214.
⁴⁷ 50 USC 403-5.
⁴⁸ Section 1.5(q). EO 12333 was signed on December 4, 1981 by President Reagan and
(continued...)

agreements within the executive branch that govern the coordination of intelligence
programs and budget processes.⁴⁹
Most NIP programs have been managed by the Defense Department. National
programs managed by DOD are gathered into several intelligence program categories
— the General Defense Intelligence Program (GDIP), the Consolidated Cryptologic
Program (CCP), the DOD Foreign Counterintelligence Program (FCIP), the National
Geospatial-Intelligence Program [formerly, the National Imagery and Mapping
Agency Program (NIMAP), and the National Reconnaissance Program (NRP).⁵⁰
In some cases, a single agency within DOD has managed one program; in other
cases responsibility has been shared. The CCP is managed by NSA. The GDIP
largely covers the work of DIA; the CCP is implemented by NSA; geospatial
intelligence is the responsibility of the NGA, the NRP is the responsibility of the
NRO, and specialized programs are found in various agencies and offices.
Counterintelligence (FCIP) is a responsibility of all agencies. Satellites and sigint —
responsibilities of the NRO, NGA, and NSA — are the largest ISR programs and
constitute a very sizable portion of the estimated $40 billion in annual intelligence
spending.
Changes in DOD’s Management of ISR. Overall coordination of these
programs within DOD was for years the responsibility of the Assistant Secretary of
Defense for Communications, Command, Control and Intelligence (C3I); but in May
2003 these functions were transferred to the Under Secretary of Defense for
Intelligence, a newly created post headed by Stephen Cambone, a longtime associate
of Defense Secretary Rumsfeld. The USD(I) is granted authority to “lead
departmental activities in programmatic processes related to intelligence and
intelligence-related programs, including, but not limited to, program change⁵¹
proposals, program evaluations, assessments, and recommendations.”
Cambone has noted that making decisions on ISR programs early in the process
could have major implications for years ahead: “There are a lot of efforts, I think
perhaps more than some people appreciate, that are either early in their development
or just beginning or are envisioned over the next 18 months or so where a choice
between spending the dollar in one direction or another could have a big payoff

⁴⁸ (...continued)
remains in effect.
⁴⁹ Intelligence Resource Manager’s Guide, 1997 edition, pp. 115-122.
⁵⁰ Non-DOD NIP programs include the Central Intelligence Agency Program (CIAP); the
Department of State, Bureau of Intelligence and Research Program; the Department of
Justice, FBI Counterintelligence Program; Department of Treasury, Office of Intelligence
Support Program; Department of Energy, Foreign Intelligence Program; CIA Retirement and
Disability System (CIARDS); and the Community Management Account (CMA). It is to
be noted that funding for only the last two programs, CIARDS and CMA, is unclassified and
identified in annual intelligence authorization legislation.
⁵¹ See John Liang and Keith J. Costa, “Pentagon Reworking Unified Command Structure to
Better Exploit NCW,” Inside the Pentagon, October 9, 2003, p. 1.

downstream.”⁵² The ultimate role of Cambone and his successors may not be fully
determined as yet, but the establishment of his office appears to reflect a more
centralized and coordinated approach to ISR acquisition. The Intelligence Reform
Act provides important acquisition and management authorities over DOD’s national
intelligence programs to the DNI. These authorities will have to be implemented in
a way that is consistent with the existing authorities of the Defense Department; the
timing and contours of the implementation process are as yet uncertain.
How ISR Funding is Included in DOD’s Budget. Managing programs
involves planning for future acquisition, preparation of budget documents, and
monitoring expenditures. Intelligence funds are programmed, budgeted, and
expended in accordance with Defense Department procedures.⁵³ They are contained
with the Budget’s 050 National Defense Function (within Function 051, DOD
Budget, or Function 054 Defense-related Activities categories). Funds for CIA are
included (“hidden”) in the DOD budget but, once appropriated, are transferred by
OMB directly to the DCI for execution. Of the eleven major programs in DOD’s
Future Years Defense Program (FYDP), most ISR funding is in Program 3,
Command, Control, Communications, Intelligence, and Space. Funding for other
programs, such as aircraft, may include intelligence-related research and
development; training, and intelligence-related functions may be in other categories.
These major categories are, in turn, divided into program elements (PEs) that can be
aggregated for different purposes, including the identification of intelligence efforts.
Slightly more than half of annual authorized intelligence spending is devoted
to the agencies that are part of the NIP; the remainder goes to programs that are part
of JMIP and TIARA. JMIP programs extend beyond one service and are included
in defense authorization and appropriations bills. Some JMIP programs are the
responsibility of a single defense agency while others are managed by one service as
an “executive agent” for the rest of DOD.
Funding for specific intelligence programs is included in the budgets of the
services and defense agencies. This funding is largely hidden in appropriations
legislation although some RDT&E programs with special code names are known to
fund intelligence efforts. Other funds are included in larger “pots” of money, such
as the appropriation account, “O&M Defensewide.”
TIARA programs are usually managed by a single service for its own forces.
One analyst describes TIARA as:
nothing more than a reporting concept. It is a designation applied to
aggregations of programs, projects and activities in military Service budgets
that provide tactical-level intelligence and related support to military operations.
These aggregations comprise two types of assets, i.e., organic military

⁵² Amy Butler, “Cambone: DoD, Intel Community Launch Study for ‘Horizontal
Integration,’ Defense Daily, September 30, 2003, p. 8.
⁵³ Except for the comparatively small intelligence accounts of the State, Justice, and
Treasury Departments.

intelligence assets and funding for Service-specific tactical intelligence⁵⁴
programs.
As a reporting concept, the TIARA category consists of a variety of programs that
may vary from year to year. In some cases, it may be difficult to distinguish among
TIARA programs and other surveillance and targeting efforts that may not be
categorized as TIARA. To complicate matters further, surveillance programs may⁵⁵
be characterized as TIARA one year but not necessarily the next.
TIARA programs are perhaps the most challenging to review because they are
forwarded as part of budget requests from the three military departments. They have
to be disaggregated and considered along with TIARA programs of the other
services, a process that is not necessarily easy and may involve a program that the
parent service believes to be an integral part of a favored weapons system. Under
such circumstances, assessing trade-offs among intelligence programs can become
difficult. Similarly, when a weapon system with a TIARA component is delayed or
cancelled, there can be significant implications for intelligence efforts that were
designed to be integrated with the delayed or cancelled effort.
Internal DOD Coordinating Boards. A number of steps have been taken
in the past to ensure an integrated approach to intelligence programs, whether NIP,
JMIP, or TIARA. An unusual DOD entity, the Expanded Defense Resources Board,
consisting not only of senior DOD military and civilian officials but also the DCI,
was established in the mid-1990s to provide a broader executive branch review.
Another interagency review entity is the Intelligence Program Review Group which
reviews issues, analyzes priorities, and studies funding alternatives at the staff level
prior to consideration by the Expanded Defense Resources Board.
Coordination Between DOD and the IC
Different procedures used by the Defense Department and the Intelligence
Community in dealing with the diffuse efforts that are collectively part of the
collection, analysis, and dissemination of intelligence have long been a source of
concern to resource managers. As noted in the Intelligence Resource Manager’s
Guide, by 1993 there was a perceived need to (a) depict intelligence capabilities and
associated resources, (b) ensure adequate levels of detail for program review and
analysis, (c) ensure that compatible processes were in place to support
decisionmaking. “The time had come to tear down barriers that had made it difficult⁵⁶
to identify shortfalls and unwanted NFIP/TIARA duplication.”
Accordingly, at congressional urging, the then-DCI, R. James Woolsey,
undertook a number of measures during his tenure (1993-1995) to ensure a
comprehensive review process by adjusting schedules to ensure that DOD and IC

⁵⁴ Intelligence Resource Manager’s Guide, p. 58 (emphases in original).
⁵⁵ A recent complication is the growing consideration of using UAVs to deliver missiles; a
system designed for reconnaissance becoming a weapons delivery systems.
⁵⁶ Intelligence Resource Manager’s Guide, p. 101.

milestones coincided and that there were joint TIARA/NFIP reviews and that a
“common budget framework” was established to make characterization of NFIP and
TIARA resources consistent. The goal was “to allow resource managers to peer
across seams into all programs, projects, and activities containing dollars and/or
manpower assets designed to meet the same or similar types of missions.”⁵⁷ One goal
was to identify changes in one program that might have an unintended consequence,
e.g. eliminating a TIARA program to collect imagery by an airborne sensor might
lead to a requirement for additional, and more expensive, satellite coverage of the
area previously covered by reconnaissance aircraft. Implementation of this effort
began with the FY1995 budget and continues to be used. Related changes involved
DOD, including the Expanded Defense Resources Board and the Intelligence
Program Review Group. An interagency Mission Requirements Board was
established by the Community Management Staff to ensure that the national and
tactical needs of all consumers were addressed.
The process has been coordinated by DOD and Intelligence Community officials
ranging from the Secretary of Defense and DCI down to lower-level budget
specialists. The DCI and the Secretary of Defense (represented by the Under
Secretary of Defense for Intelligence) are responsible for jointly deciding major
issues (and negotiating any percentage reductions that might be required to meet cuts
ordered by the President or OMB), while their respective staffs interact in defining
issues and preparing submissions to congressional committees. In practice, some
observers believe that DOD has greater influence in the process given its size and the
need to ensure that the military services have the intelligence they need to meet their
operational responsibilities.⁵⁸
Congressional Oversight of ISR Programs
Procedures for congressional oversight of intelligence activities also affect the
acquisition of ISR resources. On Capitol Hill, the NIP is overseen by the two
congressional intelligence committees. HPSCI’s jurisdiction is specified in
programmatic terms. It has oversight over NIP along with “intelligence and
intelligence-related activities of all other departments and agencies of the
Government, including the tactical intelligence and intelligence-related activities of
the Department of Defense.”⁵⁹ Senate rules, on the other hand, focus on agencies;
SSCI has jurisdiction over the CIA, DIA, NSA, other DOD agencies and
subdivisions, and the intelligence activities of the State Department and the FBI. A
crucial difference between the two chambers is the exclusion from SSCI’s
jurisdiction of “tactical military intelligence serving no national policymaking
function.”⁶⁰ HPSCI oversees JMIP and TIARA programs, coordinating with the
House Armed Services Committee. In practice, SSCI also has an opportunity to
provide comments on JMIP and TIARA programs to the Armed Services committee,

⁵⁷ Ibid.
⁵⁸ See Loch K. Johnson, “The DCI vs the Eight-Hundred Pound Gorilla,” International
Journal of Intelligence and CounterIntelligence, spring 2000.
⁵⁹ Rule X, Section 11(b)(B), of the House of Representatives.
⁶⁰ S.Res. 400, Section 14(a), 94^th Congress.

which has primary jurisdiction. Both intelligence committees have sole jurisdiction
over budgets for the CIA, the CIA retirement system, and the Community
Management Staff. After committee review, all NIP programs are included in annual
intelligence authorization legislation; NIP programs are included as well as national
defense authorization bills.
JMIP and TIARA programs are authorized by HPSCI and the House Armed
Services Committee. As a result of differing jurisdictions of the two intelligence
committees, the Senate Armed Services Committees authorizes JMIP and TIARA
expenditures. SSCI does not have authorizing authority over JMIP and TIARA, but
it reviews and analyzes the JMIP and TIARA budget request, and recommends
actions to the Armed Services Committee.
Although the relationship between intelligence committees and armed services
committees is generally cooperative, in some instances their approaches have
differed. The National Defense Authorization Act of FY1997 (P.L. 104-201)
established the National Imagery and Mapping Agency (NIMA) despite the
misgivings of Members of HPSCI.⁶¹ The position of Under Secretary of Defense for
Intelligence was established by the FY2003 National Defense Authorization Act
(P.L. 107-314, section 901), not by an intelligence authorization act. Similarly, it
was the FY2004 National Defense Authorization Act (P.L. 108-136, section 921) that
changed the name of NIMA to the National Geospatial-Intelligence Agency, not
intelligence authorization legislation.
Conclusion
Despite the existence of the coordinative mechanisms described above,
Congress formally expressed its concerns that ISR has been ill-coordinated. In part,
coordination difficulties have derived from the challenges faced by large
governmental organizations in managing fast-moving technological developments.
In addition, U.S. post-cold war defense planning continues to evolve into new, and
uncertain, approaches to a wide variety of possible conflict situations. This evolution
may make it even more difficult to reach consensus on ISR requirements in future
years. How the provisions of the Intelligence Reform Act will be implemented
remains unknown. Many complex issues will have to be addressed, including the
roles of congressional authorizing and appropriations committees. In regard to ISR
systems, the act provides the DNI with an opportunity and a staff (the Community
Management Staff is to be transferred to the Office of the DNI) to assess whether
government-wide ISR requirements are being effectively addressed.
Some observers believe that past failures to satisfy congressional concerns about
coordination resulted in significant measure from the lower relative influence of the
DCI and the Community Management Staff compared with that of the Secretary of
Defense and DOD. The DCI was arguably at a disadvantage in any dispute with

⁶¹ See Anne Daugherty Miles, The Creation of the National Imagery and Mapping Agency:
Congress’s Role as Overseer, Joint Military Intelligence College, Occasional Paper Number
Nine, April 2001.

DOD because of the latter’s size, influence, and prestige. Similarly, questions have
existed regarding the relative influence of intelligence and Armed Services
committees (and some Members have suggested that certain intelligence matters
should receive oversight from other committees). The Intelligence Reform Act did
not specify procedures for congressional oversight, but Congress may choose to
develop new approaches to reviewing ISR programs.
Some observers go so far as to argue that longstanding distinctions among
national, joint military, and tactical systems have outlived their usefulness and that
a more comprehensive approach should be attempted. Since these distinctions are
provided for in statutes and have been recently been included in the Intelligence
Reform Act, any major changes would require further congressional action.
There is a widespread sense that the optimal mix of ISR systems has not yet
been determined. Admittedly, it would be almost impossible to design analytical
processes that would identify definitive options for ISR systems readily acceptable
to all interested parties. The diverse nature of the systems, the multiple customers for
data, the number of intelligence agencies, and the dynamics of ever-changing ISR
technologies make a multi-year “roadmap” extremely difficult. Yet, a more
disciplined assessment of the potential advantages and disadvantages of different ISR
options could be required for review in the executive branch and in congressional
committees.
Given the potential for the need for future budgetary restraints on ISR programs,
with or without a new procedural framework, the acquisition of expensive new
systems will undoubtedly remain an especially complex challenge to government
deci si onm akers.

Appendix A: A Case Study in ISR Acquisition:
The Future Imagery Architecture (FIA)
and Global Hawk UAVs
Efforts to procure a new generation of reconnaissance satellites and high altitude
unmanned aerial vehicles (UAVs) serve as a case study that illustrates the dilemmas
involved in the acquisitions of intelligence platforms and systems. Both of the these
expensive and technologically sophisticated platforms can support national
policymakers as well as military commanders. Each has strengths and limitations.⁶²
While no serious observer would argue that U.S. ISR requirements could be met by
only one approach, many believe that there have been insufficient efforts to achieve
an appropriate mix that provides optimal collection capabilities while avoiding
unnecessary duplication or wasted resources.
Satellite imagery has long been one of the most valuable tools of the intelligence
profession. The need for to obtain accurate estimates of Soviet military forces in the
mid-1950s led the United States, in order to avoid highly dangerous overflights by
conventional aircraft, to develop special planes that could fly at very high altitudes
and ultimately to build reconnaissance satellites that could identify small objects
from space. Satellite imagery became the cornerstone of arms control efforts in the
Cold War and, coupled with the availability of precision guided munitions, became
the key to those post-Cold War defense tactics that rely on highly selective targeting
to destroy selected targets with minimal collateral damage.
Satellite programs are among the most expensive intelligence efforts, with
individual satellites costing a billion dollars each. The need to replace aging satellite
programs led the Intelligence Community in the mid-1990s to initiate the Future
Imagery Architecture (FIA) program that is intended to provide a greater number of
smaller satellites that can provide coverage of more regions for longer periods. FIA
has, however, received considerable criticism. In 1998, the House Intelligence
Committee has concluded:
For several years, the committee has been concerned with the increasing costs of
several major National Reconnaissance Office (NRO) programs and the NRP’s
[National Reconnaissance Program through which the NRO is funded] growing
share of the NFIP budget. Not seeing any relief from the tight fiscal
environment, the committee has sought to find technological innovations and
managerial reforms in the NRP that could reduce costs. This goal lay behind the
committee’s push to shift to larger numbers of smaller satellites, which the
committee thought also would provide better performance against hard targets,

⁶² In the 1980s, manned aircraft, especially the SR-71 Blackbird, which flew at very high
altitudes, had an important role in overhead reconnaissance, but limited inventories of
skilled pilots with highly specialized training and the potential for human casualties were
among the factors that led to demise of the program. U-2s, which fly at somewhat lower
altitudes, remain in service. Manned aircraft continue to constitute an important component
of U.S. ISR capabilities; see Nick Cook, “ISR — Manned or Unmanned? Going Solo?”
Jane’s Defence Weekly, November 19, 2003.

reduce satellite vulnerability, and help to counter foreign denial and deception
practices.
The committee, in summary, is not satisfied that all appropriate measures have
been taken to reduce or control costs in the NRP or to adequately measure the
cost-effectiveness of all overhead collection activities. The committee believes
that the DCI needs to exercise much more knowledgeable and diligent oversight
of NRO programs, with an eye to freeing up funds for investment elsewhere,
wherever possible. This oversight must extend from requirements tradeoffs, to
cost estimating, to acquisition oversight. The DCI also needs to acquire the
expertise necessary to make tradeoffs across the major NFIP programs. The DCI
can no longer afford to rely on the major program managers to police their
organizations and budgets. The committee has recommended additional funds⁶³
for the DCI to accelerate the development of these capabilities.
One media account in December 2002 reported that “The National Reconnaissance
Office’s next-generation spy satellites, known as Future Imagery Architecture, are
more than a year delayed and almost $3 billion over cost, spurring an internal
Pentagon debate about whether to proceed with the program at all, say people
familiar with the discussions.”⁶⁴ Further criticism was voiced in May 2003 by a task
force established by the Defense Science Board which submitted a report finding that
“the FIA program under contract at the time of our review to be significantly
underfunded and technically flawed. The task force believes that the FIA program —
thus structured — is not executable.”⁶⁵
The process of satellite procurement and the role of the DCI vis-a-vis DOD has
come under some criticism. One former CIA official who worked with the NRO has
described “an incredibly inefficient requirements process,” and suggested that the
DCI’s role has been reduced to the detriment of the overall satellite reconnaissance
effort:
The process for deriving the requirements for the new imagery architecture (FIA)
took two years and makes the point about the DCI’s diminished power clear.
DoD and the Joint Requirements Oversight Council (JROC) played key roles in
the FIA requirements process; now DoD essentially controls all major NRO
requirements. The DCI and the CIA have let DoD significantly erode what

⁶³ U.S. Congress, House Permanent Select Committee on Intelligence, Intelligence
Authorization Act for Fiscal Year 1999, 105^th Congress, 2d session, H.Rept. 105-508, May

5, 1998, pp. 11-12.

⁶⁴ Anne Marie Squeo, Officials Say Space Programs, Facing Delays, Are ‘In Trouble.’” Wall
Street Journal, December 2, 2002, p. A1.
⁶⁵ Department of Defense, Office of the Under Secretary of Defense for Acquisition,
Technology, and Logistics, Report of the Defense Science Board/Air Force Scientific
Advisory Board Joint Task Force on Acquisition of National Security Space Programs, May
2003, p. 31. The Task Force added that theses problems could be mitigated by various
changes in approach, including additional funding.

should be the DCI’s major responsibility: the arbitration, consolidation, and⁶⁶
establishment of national intelligence requirements.
FIA, whose satellites are expected to be launched beginning around 2008,
absorbs a major portion of the intelligence budget and reportedly continues to be⁶⁷
plagued with serious delays and management problems. According to one media
account, the program is more than a year behind schedule and is forcing a shift of⁶⁸
some $4 billion from other ISR programs.Some observers have, accordingly,
suggested that many of the capabilities of reconnaissance satellites could be realized
by relying on less expensive, high-altitude unmanned aerial vehicles such as Global
Hawk, which has recently become available for operational missions and has been
used during Operation Iraq Freedom. Proponents of Global Hawks, which have been
estimated to cost some $57 million per unit, maintain that these vehicles could
provide a considerable portion of the imagery that could otherwise be obtainable by
satellites that cost many times that figure.⁶⁹
There are advantages and disadvantages to both satellites and UAVs (as well as
manned aircraft which can also be used advantageously in some circumstances).
Satellites have been considered invulnerable to attacks from all but the most⁷⁰
sophisticated adversary and can be launched from U.S. territory. They are in orbit
for years and can be shifted from target to target as needs change. On the other hand,
they are expensive and there are inevitably limited numbers in the U.S. inventory.
Global Hawks, on the other hand, can be launched when needed, and can be targeted
by local commanders. They do not, however, have the capability to remain overhead
for lengthy periods (sometimes termed a “long-dwell capability”), and they may be
vulnerable to attack. While inexpensive in comparison with satellites, they are far
too costly to be considered expendable, as is the case with some tactical UAVs.

⁶⁶ Robert Kohler, “One Officer’s Perspective: The Decline of the National Reconnaissance
Office,” Studies in Intelligence, Unclassified Articles, Vol. 46, No. 2, 2002.
⁶⁷ One media account is Douglas Pasternak, “Lack of Intelligence,” U.S. News & World
Report, August 11, 2003. Consideration has been given to much greater use of civilian
reconnaissance systems; in 1999, the Senate Intelligence Committee urged NIMA to identify
imagery requirements that could be met by commercial imagery in order that funds could
be target for that purpose. U.S. Congress, Senate Select Committee on Intelligence,
Authorizing Appropriations for Fiscal Year 2000 for the Intelligence Activities of the United
States Government and the Central Intelligence Agency Retirement and Disability System,^th^st

106 Congress, 1 session, S.Rept. 106-48, May 11, 1999, p. 5.

⁶⁸ Douglas Jehl, “Boeing Lags in Building Spy Satellites,” New York Times, December 4,

2003, p. C1.

⁶⁹ See CRS Report RL31872,Unmanned Aerial Vehicles: Background and Issues for
Congress, by Elizabeth Bone and Christopher Bolkcom; see also, Jason Bates and Jeremy
Singer, “Pentagon May Merge FIA with Space Based Radar,” Space News, September 15,

2003, p. 26.

⁷⁰ The relative invulnerability of satellites from hostile attack is no longer considered a
given, however; see Jeremy Singer, “Importance of Protecting Satellites, Ground Systems
Growing,” Space News, September 15, 2003, p. 26.

UAV acquisition has been as heavily criticized as FIA. HPSCI, in particular,
has pointed out problems with Global Hawk procurement:
The Committee is very concerned about the management and cost growth of the
Global Hawk endurance UAV program.... [Because of Air Force-initiated
upgrades] a $10 million per copy Global Hawk platform has become at least a
$30-40 million aircraft, and the cost will increase substantially further as
additional and improved sensors, and corresponding power/payload upgrades, are
added. In fact, the Air Force projects that the average total unit cost (including
all program costs) will exceed $75 million per copy.
... there is now an effort to flood the Global Hawk program with money, there are
ad hoc plans for rapid, major upgrades before requirements have been
established, and no sign of serious examination of where and how Global Hawk
fits into an overall collection architecture.... DoD has taken no serious steps to
be able to relay and process the huge amounts of data from Global Hawk, or to
process, exploit, and disseminate all the data that a fleet of 51 Global Hawks⁷¹
with highly capable sensors will generate.
Satellites are budgeted under NIP and operated by the NRO; Global Hawk
UAVs, on the other hand, have been budgeted under JMIP and operated by Air Force
components of regional commands. These separate paths have made the possibility
of potential trade-offs between space and UAV collection vastly more difficult.
Observers sense that current procedures to integrate intelligence acquisition efforts
have not led to a comprehensive assessment of major issues relating to satellite and
UAV programs. If UAVs can do at least part of the work of satellites then, arguably,
considerable budgetary savings might be realized. On the other hand, a failure to
take advantage of U.S. satellite technological superiority could limit intelligence-
gathering capabilities for decades to come and prompt the decline of an important
U.S. industry.

⁷¹ U.S. Congress, House Permanent Select Committee on Intelligence, Intelligence
Authorization Act for Fiscal Year 2003, 107^th Congress, 2^nd session, H.Rept. 107-592, July

18, 2002, pp. 21-22.