RADIO FREE EUROPE (RFE) AND RADIO LIBERTY (RL)

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP72-00337R000500270029-4
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 22
• Document Creation Date: December 20, 2016
• Document Release Date: May 10, 2007
• Sequence Number: 29
• Publication Date: May 13, 1971
• Content Type: MF

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SECRET/EXDIS
MEMORANDUM FOR THE 40 COM,U%IITTEI
Subject: Radio Free Europe (RFE) and
Radio Liberty (RL)
Background
14'", , ",?M
At its meeting of March 31, 1971, the 40 Committee
agreed that the concept of creating an independent
agency or other public-private mechanism for criannel-
ling publicly appropriated funds to RFE and RL should
be examined. The Committee asked for a draft Bill and
on April 7, 1971, was given a draft designed to create
an "American Council for Private International Communi-
cations." The draft Bill was modelled on the "Public
Broadcasting-Act of 1967" (PL 90-129).
At its meeting of April 14, 1971, the Committee
approved the State/CIA recommendation that preliminary
soundings of Congressional opinion be undertaken "in
order to obtain a reading on whether the proposal
should be presented officially to the Senate." In
light of this decision, the Department of State 1) sub-
mitted the draft Bill to O~tB so that the appropriate
clearance process could be undertaken and the Bill readied
for prompt submission to the Senate should the Committee
so decide; 2) requested and obtained from Senator Case a
change in the proposed date for hearings on RFE/RL in
the Senate Foreign Relations Committee from April 28 to
May 24; 3) conducted explorations, jointly with CIA, of
Congressional opinion in accordance with the plan pre-
sented to the Committee with its memorandum of April 7,
1971 (Tab A).
Results of Consultations
A. Prospects for Continued Funding of RFE/RL
through tie CIA Budget
In accordance with the expressed desire of the
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Committee,-consultations included examination of
continued covert funding of RFE/RL through the CIA
budget. During the course of the Congressional soundings,
the Chairmen of the Senate and House Appropriations
Committees expressed strong opposition to funding the
Radios through CIA beyond June 30, 1971. The Chairmen
are unwilling to include an appropriation for the Radios
as they maintain that this would probably jeopardize
the individual appropriations not only of CIA but other
Executive agencies as well. In their view, this could
come about as certain Committee members apparently
intend to use the Radio funding question to expose, and
attempt to discredit, sensitive activities carried out
by the Executive branch. It was the judgment of the
CIA and State Department offices for Congressional
Relations that Senator Ellender and Representative Mahon
would "under no circumstances" ask their Committees to
include funds for the Radios in the CIA budget for FY
1972.
B. Prospects for Interim Funding of RFE/RL
through the CIA Budget until a New Mechanism
is Established
In view of the attitude of the Chairmen of the
Appropriations Committees with regard to continuation
of the status quo, their views were sought on the
feasibility of funding the Radios through the CIA budget
on the basis of a continuing resolution until such time
as a new, public mechanism had been authorized and
granted funds by Congress. The Chairmen somewhat
reluctantly indicated this could be done for a few
months--perhaps until the August recess, by which time
the DOD FY 1972 budget is expected to be approved. This
solution would provide funds for an additional 30 to 60
days, but no longer. Apart from the fact that the two
Chairmen appear reluctant to use a continuing resolution,
such a course is not deemed advisable for two reasons:
1. If there has been a hearing on CIA's "black
budget" prior to June 30, as is expected, and if CIA has
been formally advised that its FY 1972 budget cannot
include funds for the Radios, the legality of using funds
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for this purpose under a continuing resolution is open
to question.
2. Even if interim funds for the Radios could be
secured on the basis of a continuing resolution for the
DOD budget, a budgetary hiatus would occur if the
Department of Defense budget is appropriated prior to
action on appropriations for the proposed Council.
CIA has explored alternative methods of securing
funds for the Radios to cover the period until an
appropriation is made under the terms of the draft Bill
creating the American Council for Private International
Communications, Incorporated. It is not feasible to
provide money from CIA reserves since the constraints
imposed by the Appropriations Committee Chairmen in
refusing covert appropriations in FY 1972 would be
equally applicable to the use of reserve funds. More-
over, current requirements against the reserve funds
are of such a priority nature that CIA cannot allow
their use for the Radios unless assured that they would
be replenished in full. CIA has also inquired of OMB
whether tr in FY 1 71 of the required funds (CIA
programmed for the Radios in FY 1972)
s feasible. OMB 25X1
advises thati funds are not available unless 25X1
higher authority orders them released. OMB also feels
that such funds, if available, could not be used for
this purpose without Congressional concurrence.
As of now, therefore, no satisfactory method for
interim funding has been developed, and there is a real
possibility that the Radios will be without financial
support at the beginning of FY 1972. Should this occur,
liquidation procedures would have to be promptly
initiated, and it is estimated that these costs are
likely to exceed the combined annual budgets of the two
organizations. However, in the above situation, funds
are not available even for this purpose.
In light of these circumstances, it would appear
that the only conceivable method of ensuring the orderly
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funding of-the Radios until they come under the
supervision of the proposed Council is to fund them
for FY 1972 out of overall year-end FY 1971 savings.
This would be tantamount to channelling unused, publicly
appropriated, non-CIA funds to a use which would, for
the interim, still be under CIA control (although the
May 24 Senate Hearings will have, by the end of FY 1971,
yielded a clear government acknowledgment that it funds
the Radios).
C. Prospects for passage in Senate and House
of the Authorization Bill in its present
form
OMB anticipates clearing the draft Bill with minor
technical changes within the next few days during which
time it will discuss Treasury's reluctance to be used
as a funding channel for the Council. As the result
of our review of the concepts in the draft Bill with
Senator Case, he has indicated general agreement with
it and expressed a willingness to act as its sponsor
in its present form possibly with some modifications
regarding the appointment of members of the Board of
Directors.- As a result, we believe the Bill's prospects
in the Senate Foreign Relations Committee are good. In
addition, Congressman Reid has also indicated his support,
which should aid our testimony before the House Foreign
Affairs Committee whose chairman, Representative 1.1organ,
has also been briefed on the draft Bill. Other Senators
and Congressmen, during the consultations, initially
questioned the need for a new government entity in lieu
of funding the Radios through State or USIA, but sub-
sequently agreed with the approach in the draft Bill.
Presently there is no known opposition.
We believe that there are reasonably good prospects
for passage of an authorizing Bill of the type envisaged
(Tab B) in the Senate and House with the support of a
liberal-conservative coalition with Case and Reid heading
up the liberal side.
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D. Prospects of Appropriations being Approved
once Authorizing Bill is passed
Chairman Ellender, after some discussion, indicated
that he would not actively support the Bill but that
he would not obstruct it. He indicated his strong
intention of having his appropriations bills pass
the Senate prior to the August recess, although
Chairman Mahon had indicated his belief that the
Defense Appropriations Bill will carry over in the
House.until after the August recess. In other consulta-
tions, questions were raised concerning the Radios'
funding levels in view of the dollar crisis and moves
to retrench on our foreign expenditures.
Conclusions
The exploratory consultations have, unfortunately,
produced more clarity on the impossibility of maintaining
the present method of funding RFE/RL than on the
possibility of funding the Radios reliably through a
new publicly funded entity. Furthermore, they have
revealed that the question of creating a new entity and
obtaining funds for it is urgent in view of the strong
reluctance of the Appropriations Committee chairmen to
continue the present funding system into FY 1972.
The limited explorations of Congressional views
suggest that there are "reasonably good prospects" of
getting adequate support for an authorizing bill
establishing an American Council on Private International
Communications. However, in view of the current inclina-
tion in Congress to cut foreign expenditures, it will
take a strong effort by the Administration if funding
for the Radios is to be maintained at the present level.
It is therefore concluded that virtually the only
choice open to the Administration on the problem of
funding RFE/RL is to proceed with the draft Bill. It
is further concluded that personal involvement by the
President will be required in order to get across to
key Congressional leaders 1) the need to give the Bill
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priority in order to get it considered prior to or
early in FY 1972; 2) the importance of continuing to
fund the Radios at the present level.
Recommendations
1. The 40 Committee is asked to recommend to the
President that he approve the draft Bill (Tab B) for
submission to Congress prior to the Senate Foreign
Relations Committee hearings on the Radios now
scheduled for May 24.
2. The 40 Committee is asked to recommend that
the President, during the period prior to the Senate
hearings, emphasize to the Congressional leadership
the importance of expediting this legislation and of
continuing the present level of funding of the Radios.
3. The 40 Committee is asked to recommend to the
President that, until a new entity can be created and
granted appropriations to fund the Radios, he authorize,
with the concurrence of Congressional leaders: (a) the funding
of the Radios at the present level out of overall FY 1971
US budgetary savings since there are no FY 1972 funds
available to CIA for this purpose; and (b) the recognition
of this interim funding by the State Department press
officer, or other appropriate officersif asked.
4. The 40 Committee is asked to approve the con-
tinuation of consultation by State and CIA with key
members of Congress (Tab C) to obtain additional support
on a broader basis prior to the Senate Foreign Relations
Committee Hearings scheduled for May 24. Some of the
present members of RFE/RL Boards (Tab D), might be used
to contact members of Congress with whom they have
personal contact. Outstanding public witnesses should
be contacted for the hearings.
5. The 40 Committee is asked to recommend that
the Treasury, as a department which disburses funds
to a wide variety of independent entities and is not
involved., in the direct conduct of diplomacy or programs
in the Communist countries, be designated as the channel
for disbursing publicly appropriated funds to the new
entity to be created to fund the Radios. (A copy of the
letter from Treasury to OMB giving its position on this
is at Tab E.)
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6. The attention of the 40 Committee is invited
to the subject of recommending a Chairman of the Board
of the American Council for Private International
Communications, Incorporated in order to provide during
Congressional consultations an idea as to the caliber
of the Board envisaged for the Council. Names such
as those of Dr. Milton Eisenhower, Ambassador Robert D.
Murphy, Ambassador Llewellyn E. Thompson, and Governor
William Scranton, suggest themselves.
v'-~
,y,,, ~~j
U. Alexis Jbfinson
Tab A - Explorations of Congressional Opinion
in April-May 1971
Tab B - Draft Bill providing for establishment
of American Council for Private
International Communications, Inc.
Tab C - Foreign Relations and Appropriations
Committees of the House and Senate
Tab D - RFE and RL Boards of Directors
Tab E - Treasury Department letter to ONIB
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Congressional Consultations in Connection with the
Administration's Proposal for an American Council for
Private International Communications, Incorporated (ACPIC)
After clearance by the 40 Committee on April 14,
1971 of the draft legislation (Tab B) initial contacts
were made with Senator Case and Representative Reid to
explain to them the basic provisions of the proposal
and to obtain their approval. They were informed that
we intended to conduct additional limited consultations
to ascertain whether there would be support for Congres-
sional funding of the Radios through the proposed new
corporation. These additional consultations included:
Hugh Scott
Allen J. Ellender
Representatives
Carl Albert
Gerald Ford-
William Mailliard
George H. Mahon
Thomas Morgan
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(h) to obtain from time to time as appropriate, the
Cervices of experts and consultants to aid the &orporation
in accordance with the carrying out of the, purposes of this
Act;
(~_) to accept and utilize on behalf of the corporation
the services of voluntary and uncompensated pc ; ;oc,r,el from
private. life and to reimburse them for travel.
c: xp rases
including; per diem, as appropriate;
(,j) to rent office space in the District of Columbia and
cisu\7i'ie-:c i.Ys necessary to its purposes;
(k) to make all other expenditures necessary to carry
out the purposes ,of this Act.
ANNUAL REPORT
SECTION V. The corporation shall on or before the 31st
day of, January of each year submit an annual report, with
financial appendices as appropriate, on its activities under
this Act during the preceding calendar year to the President
of the United States, who shall thereafter forward such report
to the Congress, tog~th_t with such recommendations as he may
deem appropriate. Such report .shall include a list of the
grants made by the corporation during the preceding calendar.
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year; a statement of the use to which each recipient applied
any grant received during the preceding calendar year; and
any reccm.Ytcndations which the corporation may deem appropriate.
SECTION VI. For purposes of venue in civil actions,
the corporation shall be deemed a resident of the judicial
district of Washington, D. C.
NONPROFIT NATURE OF THE CORPORATION
SECT11'0711 VTI. The -pur_pos as of the corporation shall be
exclusively cdueai;ional and not for profit and no part of the
incor.. or assets of the 'c..orpbration shall innure to the benefit
of any director, officer; employee, or any other individual
except-as salary or reasonable compensation for services.
States or any territory or possession thereof.
The corporation, inclu..zding its property and income, shall be
exempt from taxation now or hereafter imposed by the United
SECTION VIII. The account's of the''corpoxation shall be
audited annually in accordance with generally, accepted auditing
standards by independent certified public accountants or
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year; a statement of the use to which each recipient applied
any grant received during the preceding calendar year; and
any recommendations which the corporation may deem appropriate.
VENUE AND LIABILITY
SECTION VI. For purposes of venue in civil actions,
the corporation shall be deemed a resident of the judicial
district of Washington, D. C.
NONPROFIT NATURE OF THE CORPORATION
SECTION VII. The-purposes of the corporation shall be
exclusively educational and not for profit and no part of the
income or assets of the tcorporation shall innure to the benefit
of any director, officer, employee, or any other individual
except'as salary or reasonable compensation for services.
The corporation,including its property and income, shall be
exempt from taxation now or hereafter imposed by the United
States or any territory or possession thereof.
AUDIT
SECTION VIII. The accounts of the ccorpo-ration shall be
audited annually in accordance with generally accepted auditing
standards by independent certified public accountants or
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independent licensed public accountants certified or licensed
by a regulatory authority of a State or other political sub-
division of the United States. The report of each such
independent audit shall be included in the annual report.
The financial transactions of the corporation for any fiscal
year during which Federal funds are available to finance any
portion of its operations may be audited by the General
Accounting Office in accordance with the principles and
procedures applicable to commercial corporate transactions and
under such rules and regulations as may be prescribed by the
Comptroller General of the United States. A report of each
such audit shall be made by the Comptroller General to the
Congress. A copy of each report shall be furnished to the
President and to the corporation at the time it is submitted
to the Congress.
FINANCING
SECTION IX. (a) To enable the corporation to carry
out its powers and duties, there is authorized to be
appropriated to the Department of the Treasury to be disbursed
to the ccorporation,out of any money-in the Treasury not other-
wise appropriated, not to exceed $ for the period
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Except for funds appropriated under
this section, no funds appropriated after the date of
enactment of this section for any fiscal year, under this
or any other provision of law, may be made available to or
for the use of the corporation.
(b) Appropriations made pursuant to the authority
provided in subsection (a) of this subsection shall remain
available. until expended.
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