SENIOR ADMINISTRATION OFFICIAL: Good morning. As all of you know at this point, the President approved yesterday afternoon revisions to Executive Order 12333. I'd like to give you a brief road map of what we'll do while we're chatting with you this morning before we turn to your questions.

I'd like to say a word about the background to this executive order. Some of you will be familiar with it; others may not. Highlight a few significant points or points that we believe are significant about the actions taken by the President, summarize the process that led to these specific revisions, because there's been some interest in that, and then I'll talk very briefly about some of the structural changes that you'll find when you have an opportunity to review the order in its Part 1.

Now, some of you will be familiar with the structure of this executive order, but it contains three parts. Part 1 is where a number of the intelligence community structures are described; the relationships and roles and responsibilities of various senior officials in the intelligence community. In Part 2, this is where you'll find the longstanding and extremely significant protections for Americans' civil liberties. And then in Part 3, you'll find a series of definitions that largely track the statute.

I would say at the outset that this is an exceptionally complex executive order. I'm not sure -- depending on how you print it, it's either 26 or 28 pages, single-spaced. It's a foundational document for the intelligence community. So it may be that some of your questions we're not able to address completely here today, but we'll take those back and get you responses after we've had a chance to look further. We may also refer you to the Office for the Director of National Intelligence or the Justice Department for more detailed explanations in areas where they're going to be expert in how the order will be implemented.

The background, I think, most of you will know by now. This is a 1981 executive order signed by President Reagan. It's been amended two times during this administration, I would say to make technical adjustments, principally. So this is the first significant adjustment in the executive order in several decades.

With the passage by the Congress and signature by the President in the fall of 2004, the Intelligence Reform and Terrorist Prevention Act -- significant provisions in this executive order became out of date. And so one of the things we'll stress, that it was absolutely necessary to revise and update -- modernize this order. And that's of course one of the reasons we undertook it.

The objectives of the order are fairly simply stated in the text itself, but as I said, it is a foundational document. It has a daily and significant impact on the activities of the intelligence community and the relationships in that important community. At the highest level, of course, the aim here is to create a more effective intelligence community, where these 16 agencies can be better integrated, work more collaboratively with one another, and also share more information freely. And these are themes you'll recognize from the reports of the 9/11 and WMD commissions, and also themes that the Director of National Intelligence Mike McConnell has stressed repeatedly in public remarks and appearances before the congressional oversight committees.

At the end of the day, though, we don't want to lose sight of the fact that the goal of all of our nation's intelligence activities is to provide the President with information that's accurate, timely, and presented to him in a useful form that allows him to make better national security decisions.

So the question that's arisen that we'll take on up front is, why do this now? There are a number of reasons -- I think all combined they make a compelling case, but we'll be happy to take your questions on it.

The first, as I mentioned, is the order was simply out of date. It needed to be updated to conform to the new intelligence structures, to the intelligence reform law passed in 2004, reflect the roles and responsibilities of the Director of National Intelligence, and also provide implementing guidelines for a number of the recommendations from the 9/11 and the WMD commissions.

Another reason why it's taking place at this point is frankly we have three years of experience under our belts with the new structures under the IRTPA, so we've had an opportunity -- with, of course, the advice of Director McConnell, to judge where we've made progress, where we've been slow in making progress, and to make adjustments and clarifications that can help push these important reforms forward.

Another not insignificant point I'd mention to you is we have a fairly unique set of advisors at senior levels of the national security establishment right now with many decades of intelligence experience. Obviously, Mike McConnell is a superbly qualified director with decades of experience, leadership experience in the intelligence community. He's worked closely throughout this process with Secretary Gates, with a distinguished -- obviously a distinguished intelligence community background. The Under Secretary of Defense Jim Clapper, who's led a number of agencies in the intelligence community, and General Mike Hayden, who's, of course, doing a superb job leading the CIA.

So these four advisors really played a key role in developing these revisions to the executive order. And their presence on the President's national security team made this all the more important to do now.

Finally, I'd remind you that the IRTPA itself in section 1018 directed the President to issue guidelines concerning how the Director of National Intelligence would implement his authorities -- in particular, to ensure that nothing he did in that regard would abrogate the authorities of other department heads. So, in our view, these guidelines satisfy that requirement and constitute those guidelines.

Maybe the most important thing I can say is that, of course, the President is anxious to institutionalize a number of important tools that he and his successors are going to need to fight and win the war on terrorism. Recently passed the new FISA legislation, which was an important milestone, and ensuring that our intelligence community is organized correctly and as effective as it can be is another significant step in that direction.

With respect to the process, I think it would be unfair to say that this process either started this summer or was rushed to completion this summer. Rather, this all started early last fall with a project within the intelligence community in the Office of Director of National Intelligence, where they consulted with their intelligence community colleagues and developed a set of recommendations that they brought forward to the National Security Council.

It's been an extensive interagency process over many months with all of the relevant agencies participating fully. We've had good discussions, as you would expect; lively discussions as well. The principals, including those individuals I named earlier in the call, have been extensively involved in all of this, solving some of the hard problems, and literally met, discussed, and played a role in resolving issues at every stage of this process.

Finally, the President, of course, authorized these revisions, authorized the process, and was involved in every stage leading up to his approval yesterday afternoon of the final revisions.

Another point I would highlight to you is that because this is such a complex area, these relationships are complicated, the work they do is important, these revisions have truly been in the hands of intelligence professionals almost from the start, right up through the principals where you had these very extremely experienced individuals providing the President advice. So, for all of those reasons, we felt it was necessary to take this opportunity to revise, update and modernize the order this summer.

The last several weeks, I would just note we've been engaged in conversations with the relevant committees on Capitol Hill, a series of calls, staff-level briefings. I believe Director McConnell is appearing today before the House and Senate intelligence oversight committees to answer some of their questions in this area.

Although there's been a -- frankly a flurry of discussion and conversation with the Congress over the last several weeks, I would highlight to you that we've literally been in a conversation with the Congress and with the American people about the functioning of the intelligence community since the fall of 2004. I would direct you to a February session that Director McConnell had with the Senate committee, specifically on his authorities, the progress being made towards implementing these intelligence reforms. The issue was also raised at Secretary Gates's confirmation.

And today we've received relatively positive, favorable reviews from our engagements with the Congress. They think we're doing the right thing, and we believe we are as well.

I want to say a couple of words about some of the pieces of Part 1 before I turn it over to a colleague who will address the provisions that you'll find in Part 2 of this order. First I would ask you not to overlook the preamble. There's some very significant activity in the preamble of this executive order; some of it consistent with the original executive order, certain parts of it new.

But most importantly I'd say the President is charging his intelligence community to use all reasonable and lawful means to gather the information that we need to protect the nation. And also we've highlighted in the preamble the fact that all of the intelligence activities authorized by this order are to be undertaken in a manner that protects the constitutional rights of Americans. That's extremely important to us.

The second piece I'd draw your attention to -- and I apologize if you don't have a copy of the order in front of you; you will shortly -- in the goals section, you'll note there's a specific reference to the intelligence needs of state, local and tribal elements. This is an example of something that's changed, an important reform and recommendation coming out of the 9/11 and WMD commission, the work of the WMD and 9/11 commissions. And so it specifically called out that the work of the intelligence community is to take account of their needs.

And next I'd direct you to section 1.3 of the executive order. That's where you'll find a delineation of the authorities for the Director of National Intelligence. There are 24, in some cases detailed, provisions under that section. In each case, the Director of National Intelligence is either told he "shall" or he "may," depending on the topic, undertake certain activities.

Now, you'll want to spend some time looking at these, because they are complicated and it's very much the core of the executive order. I'll highlight just a few to you here today before we move on to Part 1.

The first is, in 1.3(a)(1), you'll find that the Director of National Intelligence is authorized to play a role in defining the term "national intelligence," what constitutes national intelligence. This was a new term coined in the intelligence reform law in 2004, and it allows the Director to issue guidelines that will tell the rest of the government when information pertains to more than one agency, which is the statutory definition.

The Director is also authorized to issue guidelines for the intelligence community obtaining access to that information, whether it resides in an intelligence community agency or outside of the intelligence community. And with respect to intelligence community access to information that doesn't reside in the intelligence community, other agencies in government that might be useful for intelligence analysts to have, the Attorney General will be approving those guidelines because it might pertain to U.S. persons or other protected information.

Second area I'd direct your attention to is in 1.3(b)(12); the Director is given the flexibility to appoint functional and mission managers. This is an important management tool within the intelligence community. And while the Director may exercise his discretion to appoint these functional mission managers, the President acted in this order to actually name three of them.

The CIA Director is named as the functional manager for human intelligence, HUMINT. The NSA Director, of course, as he has been, is the functional manager for signals intelligence, or SIGINT. And the Director for the NGA is appointed the functional manager for geospatial intelligence.

Next, I'd turn your attention to 1.3(b), sections 20 and 21. These are important provisions regarding the coordination of intelligence activities. The first thing I'd highlight to you is that the overall responsibility for ensuring that intelligence activities, whether they are undertaken in the United States or overseas, are de-conflicted, coordinated and integrated, rests with the Director of National Intelligence; core responsibility essential for the efficient functioning of our community.

Underneath that overall responsibility, you'll find specific roles assigned to the FBI and the CIA in human and human-enabled collection of intelligence in the United States, in the case of the FBI, and a parallel responsibility for the CIA overseas. And you'll note that's consistent with the section regarding the CIA Director's responsibilities in the IRTPA.

In section 21, the Director of National Intelligence is directed to work with other department and agency heads to ensure that the activities of our intelligence community, overseas and domestically, are de-conflicted, coordinated and integrated with the activities, related activities of non-intelligence community entities. And this will be one of many areas where the DNI will be directing his attention in the coming months to develop and issue guidelines that respond to this direction.

The next section I'd turn to -- and we're almost finished with the fast sweep through Part 1 -- is in 1.3(c). That's the issue that addresses issues in the IRTPA section 1018 concerning the fact that the DNI, in exercising his authorities, is obligated to respect and not abrogate the authorities, statutory authorities, of the department heads.

And what we've done here is repeated a statutory restriction in that regard, and then created a procedure by which the Director can go forward with important guidelines that he feels it's important to issue, new procedures he needs to put in place to better integrate the intelligence community, and then allow a department head, if he feels that some action, some guideline, some procedure by the Director impairs his statutory authorities, to raise that with the Director, the National Security Council, and ultimately the President. And we think this construction will allow the Director to move out relatively expeditiously with some of the important reforms that need to take place for the community to go about its business more collaboratively in a more closely integrated manner.

Finally, an area that's gotten some attention I know in the press that we saw this morning, and that concerns the Director's authorities with respect to appointments and removals of senior intelligence community officials. You'll recall the IRTPA assigned the Director a certain role in the selection of certain intelligence community senior officials. Those are by and large replicated in this section. You'll want to read it very closely. It was an area where we spent a good bit of time and it's somewhat complicated, so work your way through it slowly, and if you have questions we'll probably refer you to the Office of the DNI for more detail.

But what you'll notice is different about this over and above what you'll find in the intelligence reform law is that the Director is also given a voice in the removal, when that proves to be necessary, of senior intelligence officials. This provision also addresses the position of the Under Secretary of Defense for Intelligence, which was not referred to in the IRTPA.

And then the last thought I'll leave you with on the appointments and removals provision, and what required a lot of the very complicated construction that you'll see in the text is that most of these appointments actually -- and the removals -- actually reside with the President. So the Director of National Intelligence is really making recommendations to department heads and toward the President with respect to who's selected to occupy these positions and whether they should remain in their posts. And so I draw your attention to that when you have a chance to look at the text.

I have a colleague with me today who would like to go through some of the key points of Part 2 of the order. SENIOR ADMINISTRATION OFFICIAL: As mentioned in the introductory part of the call, Part 2 of the order is the portion that sets forth direction for the conduct of intelligence activities, and there specifically provides direction regarding the protection of rights of U.S. persons.

When you take a look at the order and compare it to the 1981 original 12333, I think you'll find that there were very, very few changes to Part 2 of the order. The revised order, as with the original order, affirms that all U.S. intelligence activities must be conducted in a manner that protects American civil liberties and privacy rights. The longstanding protections and safeguards, in other words, that are in place or that were in place and have been in place in the original executive order remained unchanged in this revised order.

The order, you'll note, on a more specific level, requires the Attorney General to approve all procedures regarding the collection of information on U.S. persons. That's not only in Part 2 of the order, but you also see very similar provisions broadly worded up front in the executive order, section 1.3(a), as well as in the Part 3 of the order -- 3.2, I believe, in particular.

Part 2 of the executive order also maintains the existing ban on assassinations, as well as preserving existing limits on human experimentation.

Finally I'd say that Part 2 also makes clear, as did the original order, that all statutes have to be complied with when the intelligence community is undertaking activities governed by specific statutes. So, for example, if the intelligence community is undertaking activity governed by the recent amendments to the Foreign Intelligence Surveillance Act, the intelligence community is obligated to comply in full with all of those statutory requirements and the procedures contained therein.

Part 3 of the executive order is the final part, and that, like its predecessor, or the original 12333, sets forth definitions and general provisions. A lot of the definitions have simply been updated to reflect what was enacted into law in the 2004 Intelligence Reform Act, and otherwise, with respect to Part 3, there have been no significant changes over the 1981 order.

So just to step back, I think if you were to set the two orders side by side, you would note that the overwhelming majority of the work done in this executive order has been done to Part 1, as was outlined. Part 2 remains essentially as it was issued in 1981. All of the procedures and protections that were in place remain in place, regarding privacy and civil liberties. And Part 3 is a general section updated to reflect Congress's 2004 statute. MS. BERGMAN: Operator, that concludes our opening remarks. We're now ready to take questions.

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