DRAFT OMB CIRCULAR A-76, PERFORMANCE OF COMMERCIAL ACTIVITIES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85M00158R000800110027-5
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 3
• Document Creation Date: December 22, 2016
• Document Release Date: February 5, 2010
• Sequence Number: 27
• Publication Date: April 1, 1983
• Content Type: MEMO

Sanitized Copy Approved for Release 2010/02/05: CIA-RDP85M00158R000800110027-5
CUTNE S RETARIAT
For necessary action. Pleaae
call to DCI/DDCI attention as
appropriate.
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NATIONAL SECURITY AGENCY
CENTRAL SECURITY SERVICE
FORT GEORGE G. MEADE, MARYLAND 20755
Serial: N0444
1 April 1983
MEMORANDUM FOR THE DIRECTOR OF CENTRAL INTELLIGENCE
SUBJECT: Draft OMB Circular A-76, "Performance of Commercial
Activities"
1. The National Security Agency recently received the
draft revised OMB Circular A-76, "Performance of Commercial
Activities." This circular has received considerable emphasis
since the current version was published in 1979, and experience
since that time does not lead me to be optimistic about our
ability to reconcile this circular with a sensitive mission.
2. A good example of the negative effect this circular
could have on the Intelligence Community is the Department of
Energy's proposal last year to contract for the operation of
its all-source communications center. Although the Department
of Energy's action was entirely consistent with OMB Circular
A-76, which does not recognize security reasons as a justifica-
tion for government operation of a facility, it was unacceptable
to users of the communications center, including the Central
Intelligence Agency (CIA), who notified the Department of Energy
that they would discontinue electrical transmission of intelligence
to the Department of Energy if contractors operated the facility.
The Department of Energy has cancelled its plans to contract
for this particular activity, but similar incidents are certain
to occur in the future unless positive preventive measures are
taken.
3. During the recent revision of the circular, provisions
were made to accommodate a number of congressional concerns about
unlimited contract operation of certain services, but no revision
was made to the current policy that "activities may not be
justified for in-house operation on the basis that (1) there is
a possibility of a strike by contract employees, [or] (2) the
activity involves or supports a classified program."
4. On October 27, 1978, the Acting Deputy Director, CIA,
sent a letter to office of Management and Budget (OMB) describing
cogently why CIA could not comply with the requirements of OMB
Circular A-76. OMB did not take exception to this letter, and
CIA has not been participating in the A-76 program. Other
intelligence entities have been subject to the circular, although
the rationale expressed in CIA's letter is equally pertinent
throughout the Intelligence Community.
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5. Everyone in the Intelligence Community shares the respon-
sibility to protect intelligence sources and methods, and we should
adopt a consistent community-wide position on what would or would
not permit us to fulfill that responsibility. Therefore, I enlist
your support in seeking community-wide exemption from the circular.
6. Like the CIA, the National Security Agency relies on
the private sector to provide goods and services whenever practical,
economical, and appropriate. We endorse the general policies
espoused in OMB Circular A-76. However, the public exposure and
lack of flexibility inherent in the program mandated by the
circular would not permit us to adequately protect sensitive
intelligence material. We must seek relief.
7. My staff is ready to work with your representatives on
this important matter. Our point of contact is
688-7208.
LPNCOLN D. FAURER
Lieutenant General, USAF
Director, NSA/Chief, CSS
Copy Furnished:
Deputy, DCI
Sanitized Copy Approved for Release 2010/02/05: CIA-RDP85M00158R000800110027-5