NRO FUNDING

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP72R00410R000200040004-9
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 11
• Document Creation Date: December 16, 2016
• Document Release Date: April 1, 2004
• Sequence Number: 4
• Content Type: MF

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uxuoxANDSTU ro*t, zssendys Director
TN7tOVG>Fi : Dep - Directs, (march)
$UDJZCT 3 NROlddiat
ME 2B.L.E.M:
1. A deaisioa is rsquirsd detsrmlet g whether finds for CIA
Projects under the NRO should be included in the CIA $udpst as part
of the CIA appropriation or Whether they should be taeluded as prof ects
uWertaken by CIA under NRO for which rsimmburiemeot is requested.
In either sass, the projects (OXCART, IDLALIS , et*.) would be
id,MlAsd to Congress as Projects whlak would be carried out by the
Atawy. In the Ltte r?eass, however, the funds would be actually .
appropriated to the Defense Dep-rtunent and :pads rw-tlabls to CIA as
rdmbusssaaeote. .
RAC]GOiROWW*
NRO review(s) completed.
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4. The new NRO Agreement providest with respect to funding.
that the NRO will be responsible for (paragraph L) "Preparation of
budget requests for all NRO programs, and presentation and sub-
stantiation of such bedgst requests to the Secretary of Deflnse and
the Dlresiat eI Central lnt*ligence. the Bureau of the Budget and
Congressioettl Cinnr ittees. " The same paragraph also provides that
"CIA will include in its budget presentation to the Hassan of the Budget
and Congressional Committees the funds for chose NRP tasks which
are assigned to CIA and which are to be financed from NRO resources."
The now NRO Agreement also provides that the NRO will be
responsible for (paragraph L.) "Direction and management of the
application of. and administration of all hands made available for the'
national Recoanaissance Program." This paragraph also provides
that "Funds expended or obligated under the authority of the Director
of Central Intelligence under Public Law 110 will be administered and
"counted for by CIA. "
5. The DCi has directed that the funds for CIA NRO prejegts be
included is the CIA budget. It sea" be argued that either method indicated
In paragraph 1. above would confsrrn to the messing and spirit of the
pravietons of the NRO Agreement and the DCI's instructions.
RELATIVE ADVANTAGES AND DISADVANTAGES OF PROCEEDING BY
WAY OF APPROPRIATION OR REIMBURSEMENT
6. Inclusion by CIA of the for NRO projects 25X1
in its appropriation as new obllg&tL" authority w ve
a. Advantages as follows:
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l' The appropriation of folds to the Allen" to
Hawse XRO tasks assigned to CIA will clearly ideatily,
in the minds of the Congresstoaal Cvm AUe.s and others.
CIA Program rssponsibiUty tot such tasks.
(2) The appropriation to CIA Cannot bo legally
diverted from CIA to aoa.CLA projects.
(3) Costsol ad ties. funds will, accordingly, be
mare armly vested in CIA chenaelse
b. alaadvsutg.s as follows:
(1) The control vested In CIA by an appropriation
may be nnore apparent than r.a1, as NRO will, to a
Very considerabt4 dtgr.e, exercise e.atralised control
over the administration and fu ding of projects.
(a) Th. Deluge Departme bas, thus far, refused
to reeegnise the validity of appropriations to CIA for NRO
projects as discussed in paragraph 3, above,
(3) A. to the problems of overruns and the urgency
of these NRO projects. it is impractical to budget adequate
funds, either under operations or in the Reserve for
Coatingeaai.s, to most all requirements as they develop.
Thug, the Agency has obtained supplemental funds, as
tetaabuse eme*ts, from DOD.
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7. nob the Brr.au at IYi Budget mad the Defense Department
have strongly urged esntralised budg.ga* in NRO for all NBO projects.
There is every indication that they would regard insistence by CIA on
the inclusion of funds for NRO programs in the Agency's appropriation
as a retrogressiea which would probably provoke lengthy renegotiations.
This would appear to be jv.tif'led only U there are substantial advantages
to be gained from a policy point of view in terms of control or offierrive.
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CONCLUXON
S. In' balance.. I bells" that the dis*diaatages of Including funds
for NRO projects In the Agy"y's appropriation outweigh the advaatagu.
A ceord$ngly, I have csnsluded that it would be better to include in the
CIA budget the amewd required for CIA NRO projects as reimbursements
from DOD for the foaowiag reasons:
at' Under this arrangement, the funds would be part
of the CIA prseeataddoaa to the Congress but would not appear
as now obligatleaal authority. This would yell the A
from the oanrs of defending a rpaest for. a
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F
now obligatiosal authority.
b. The Integrity of program funds required. by CIA to
Wanes its projects can be maintained by a joint arrange.
merit with the NR O in the form, of an Lastraction issued by
the DNRO and concurred in by the DDNRO or otherwise.
c. ' Developments to date have unUorrnly pointed in
the direction, of an lntegw ted NRO. Altlw.gh it is not
intended that the operational components coacern d with
NPO activity should be eaosoILdate4 within the NRO as a
separate entity, it aewcthclcss appears to be the general
view that the NRO should function with a csrtaiR degree of
aatsna ny. Be* the Defense Daps ment and the Bureau of
the Budget beliovo that csatsalLssd programming, budgetingo
and funding is a desirable (if not an iuidirpsaaabls) element
of the NRO. Ids not believe that the Interests of the Agency
will be adversely affected by, acquiueeenae in this arrange.
most provided the fund sequireigeals for Agency projects
are, clearly teed and administered by CIA.
4. CIA responsibility for the Agency assigned NRO
,psej*eta can be effectively exercised through As assigment
of a CIA efflcial as the Deputy DLiector, NO. and, where
aewwaary. through negotiations bttween the DQ and the
Secretary of Defense.
9. In reaching these conclusions, it should be recognized that
I am influenced by (a) a desire to reduts the over-all amount of the
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ASomW s budget sad (b) am P "V'40" of dw NR O gowning ssssatisa ssatrot sf as NRP. agrssmesA se?
10. Asaosd r, it is my Hroond rseomm
lrtim
tdgst for the sat"s NIP sad that CIA r+IIsst in Its that NRO
r burssraeat mss, spssills prej cts "Sig dgot' On a
I ~sstaiss, .b~owen,sr, that to the 1&82 ~d to it for stration.
for Ada~istsrlss tie N*O p?Jssta as -sis the DD/R*i? rsapoasible
defer to his altlaaats riswe lad am a 4Pftd t CIA. Asserdlt~lr, t will
one b provide ter disost applep de" to CtAs two botftslious~
e Njt sd
MO preJtets sad tbs sssoa.d sae tee )MO budgeting g for ay &0 adet iir e NRIa
with rsimbuzse~nsats to CIA an A sat
II Agcy oa tom. SST admInistsrsd projeste. When a
fin" AS moy poll" bas establi~ed, a piopriai Agency
QM4WS suss the proposed instrustiepj with dte DNRO.
JOHN A. HAOlg
holier
Distsib hft
Cr 01 of 6 . .acee. Dlr. .
V/42 of6?DD/R
03 of 6 - Cohzpq'o11sr
#4 of 6 ? Gen. Conned
#5 of 6 ? C/fidget D1v.
06 of 6 . Comp,.,
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ALTZZHATIY NO. 1
11*0 1aM ft -s.
BUWZ T $ ftsesdwW for CIA Dudi.K>y tSr ** National
~ueoasluMra Prs3rw
ZZTZZZNCZ: DQ - Dgaty d.s*Navy ut D ua Il*O Agruwmimet.
13 iIsvsk 1133
1. Psrpo.s: T.1mplemsat b dj.tta3 armMenoate gov.ralai
we laelsalsa sad .ar~nazkta witbla t1. CIA budget .d me"" is sovu
PRO asaipsd tasks as ravuir d sad r parasrapis 131. K. sad L. of dw
above rsisrewts.
PrsssdU.a:
b. The Integrity oI trs bads contain" la the Ag.acy
appropriation. for N10 asslpsd tasks will b. mal~i-lnod nnlsss
a4ustmiMi are ably a%rs.d to by CIA sad DOD. Asy
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Of
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by N*o ! a4ulred "Poo to log
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at s $1A Ias1t ss admd la Ms GiA bsdset asi avitg
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.ALT AUYz mo. X
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1tsmmrxczs DQ ? DOPtq 5"70" a` Dd... Mao AgrI noat,
12 barM 1963
1. P1t.as TO
1itd~cM~ assaa~amasd tve~s
1w 1as4uLM atti !pveo~stlda~ wltltlt CIA b"get a[ aaanl" to cove:
MaO osclp Ian as lscd tt~das Pnsasisphr III. it. aat L. a[ as
allow ~Sattcc; -
L I'rsMitrM:
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4. cu will aimiadator 14*0 "sign" tasks ?sparst 1y
from its regular programs aad will ollita app?rtioamMsat of
area astls#patN rotmiarae~noda trom do Burs" of we
~dge1. .
o. QA. will sonttwa to act ad sspasat ip for trade
wild may be adwasod by aw K1O la srp st of a a?CLA
assipaod toahos but wbieh are tsaaatsrrod to is Apoaap by
,NlO for ?.eaurity o: eior rouses.
3. l~a~tom~-doas
a. no atisw Psysoirroo aro to be -.tf.ettye c
with 601 Ftessl Year 1944 buftoL
e. Aay &Yitlsed lrada ro*drod Ia r y 1%) t. ftraaeo.
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as QA fs la 60 -' will be wuaw $wlialt? !a *w Ms?a
?t r?laal~ur~??a l~ra~n ~i?O.
=V886-m-', mademl
? ?
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