Document Type: 
Document Number (FOIA) /ESDN (CREST): 
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Document Creation Date: 
December 12, 2016
Document Release Date: 
April 14, 2000
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Publication Date: 
March 26, 1959
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PDF icon CIA-RDP80-01237A000100010025-8.pdf143.88 KB
Approved For Release 2002/08/13 : CIA-RDP80-01237A00010025-8 ` 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, Approved For Release 2002/08/13 : CIA-RDP80-01237A000100010025-8 S-E-C-R-E-T Approved For Release 2002/08/3 -~% S-E CIAO-R~80-01237A0001" 10025-8 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 Approved For Release 2002/08 1'3 -Er,&-- DP80-01237A000100010025-8 - 2 - Approved For ReleUpe 2002/00/ C If.9P80-01237AOO 00010025-8 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 Approved For Release 2002/08/13 :-C?A-RDP80-01237A000100010025-8