ESTIMATED FOREIGN INTELLIGENCE COSTS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-01237A000100010025-8
• Release Decision: RIFPUB
• Original Classification: S
• Document Page Count: 3
• Document Creation Date: December 12, 2016
• Document Release Date: April 14, 2000
• Sequence Number: 25
• Publication Date: March 26, 1959
• Content Type: MF

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` S-E-C R-E- T
DRAFT 26 March 1959
MEMORANDUM FOR THE UNITED STATES INTELLIGENCE BOARD
SUBJECT: Estimated Foreign Intelligence Costs
1. The present method of submitting intelligence cost data to the
Bureau of the Budget and to other branches of the Executive Department
outside of the intelligence community,has been largely governed by
criteria developed by the Bureau of the Budget. Members of the intelli-
gene, community, in turn, have routinely submitted unilateral reports to
the BOB based on these criteria.
This procedure has given rise to some confusion. The need to
prevent misinterpretations which might damage the intelligence effort
has emphasized the need for coordinated cost reporting procedures.
2. Since early fall of 1958, when it'was formed, the Ad Hoc Working
Group on Intelligence Costs has made a thorough study of the problems
involved in producing a medium by which the DCI and the USIB could develop
cost data broadly applicable to the intelligence community as a whole.
Any medium meeting this requirement must necessarily be readily adaptable
to all the USIB member agencies in more or less the same degree; otherwise,
the quality of comparability is lost and the report fails to provide a
meaningful statistical picture.
3. The production of a cost data report satisfying these specifica-
tions involved solutions to a number of basic problems. A major difficulty
derives from the fact that not all USIB agencies finance their intelligence
activities entirely from "intelligence funds" budgeted for and under the
control of the respective chiefs of intelligence. The military departments,
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for example, are supported by activities which are funded and managed by
elements of the departments outside their intelligence organizations.
For this reason, the Working Group has adopted a system of applying both
"Direct" and "Indirect" obligations as a basis for estimating as closely
as possible the true and full cost of the intelligence effort. In addi-
tion, an attempt has been made to devise an estimative procedure
sufficiently flexible to accommodate all members of the Community. For
example, some USIB agencies believe they will find it best to integrate
their "overhead" costs and enter them as an integral part of the esti-
mated cost of each intelligence function or line item. On the other
hand, some of the fully self-contained intelligence organizations like
CIA and NSA may find it more practical to show their overhead costs
separately. The format and its related procedures permit either method
to be used.
4. The Working Group is agreed that this cost data should be
prepared on a fully coordinated basis and that any presentation of cost
data connected with community-wide intelligence obligations to agencies
and departments of the government outside the intelligence community be
made as a corporate USIB act. Consequently, it further recommends that
the Working Group be constituted as a specific USIB committee, designated
as the Cost Estimates to insure the Committee, coordinated development
of this report and any other reports which may be required in connection
with intelligence cost data.
5. It is also recommended that the proposed Cost Estimates Committee
be authorized to compile reports for the Fiscal Year 1959 in accordance
with the attached Tab A. It is also recommended that the Committee be
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authorized to adjust the format and content of this report if it is found
necessary in the light of experience and the difficulties which might be
encountered by the various USIB agencies in compiling the requested
information.
6. It is further recommended that the Committee submit the report
to the USIB and after reviewing and approving the report, it would then
be distributed by the Chairman of the USIB to the Bureau of the Budget
and the President's Board of Consultants on Foreign Intelligence activi-
ties. This development and review of cost estimates on a fully coordinated
basis will ensure that all concerned understood the basis on which the
estimates were prepared, and any confusion as to the meaning of the figures
could be eliminated prior to any distribution of the data outside the
intelligence community.
S-E-C R E T
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