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$Title{Iran-Contra Affair: The Report
Chapter 26A  The Boland Amendments and The NSC Staff}
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$Author{Various}
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$Subject{boland
intelligence
contras
ii
nsc
support
activities
staff
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congress}
$Date{1987}
$Log{}
Title:       Iran-Contra Affair: The Report
Author:      Various
Date:        1987

Chapter 26A  The Boland Amendments and The NSC Staff

     Beginning in 1983, Congress responded to the President's policy toward
the Contras principally through its power over appropriations - one of the
crucial checks on Executive power in the Nation's system of checks and
balances.  Because the President's program depended upon providing financial
assistance to the Contras, appropriations bills became the forum for debating
what the Nation's policy should be.

     Aid to the Contras was controversial from the beginning.  The Kissinger
Commission, unanimous on virtually all other recommendations about Central
America, could not agree on the Contras.  The Administration's justifications
for aid to the Contras were sometimes contradictory.  The President publicly
denied that his goal was to overthrow the Sandinista Government.  Yet the
Contras pursued only one goal - to topple the Sandinistas.

     In Congress, the two Chambers found themselves at odds, with the House
generally denying or restricting and the Senate generally supporting aid for
the Contras.  Votes in each Chamber were often decided by razor-thin margins.

     Ultimately, restrictions on assistance to the Contras were embodied in
the Boland Amendments, named after their chief sponsor, Representative Edward
P. Boland.  While Congress applied various requirements to support for the
Contras in each of the six fiscal years from October 1, 1982, to September 30,
1987, the legislation for fiscal years 1983, 1985, and 1986 embodied the most
important restrictions and will be designated Boland, I, II, and III,
respectively.

     The Boland Amendments were compromises between supporters of the
Administration's programs and opponents of Contra aid.  As compromises, they
were written not with the precision of a tax code, but in the language of
trust and with the expectation that they would be carried out in good faith.
None expected the Administration to secretly seek loopholes, or to lead
Congress to believe that support was not being given to the Contras when, in
fact, it was.

     This Chapter focuses on how the Boland Amendments evolved and on how one
element within the White House - the National Security Council staff -
discharged its trust under the Boland Amendments.

Boland I:  September 27, 1982, to December 7, 1983

     As has been noted in other chapters, the Administration's efforts on
behalf of the Nicaraguan resistance began not long after the Administration
began.  By the end of 1981, as required by law, the Administration was
advising the Intelligence Committees in both chambers of Congress about the
Central Intelligence Agency's involvement in Nicaragua, which was then funded
out of the CIA's contingency reserve.  According to the Administration, its
covert activities were intended to interdict the flow of arms from Nicaragua
to rebel forces opposing the government of El Salvador.  Ultimately, both
Intelligence Committees sought to curtail, or at least channel, the CIA's
activities in the region by restricting the CIA's use of its contingency
reserve funding.  The first such restriction was embodied in a classified
annex to the intelligence authorization bill for fiscal year 1983, which
became effective September 27, 1982.

     In late 1982, the American press began to report accounts of the
Administration's "secret war" in Nicaragua.  On December 8, 1982,
Representative Tom Harkin offered an amendment to the pending Defense
Appropriations Bill for fiscal year 1983 stating:

None of the funds provided in this Act may be used by the Central Intelligence
Agency or the Department of Defense to furnish military equipment, military
training or advice, or other support for military activities, to any group or
individual, not a part of a country's armed forces, for the purpose of
assisting that group or individual in carrying out military activities in or
against Nicaragua.

     Soon thereafter, Representative Boland, Chairman of the House Permanent
Select Committee on Intelligence, sponsored a substitute - referring
explicitly to the overthrow of the Government of Nicaragua - that was to
become Boland I:

None of the funds provided in this Act may be used by the Central Intelligence
Agency or the Department of Defense to furnish military equipment, military
training or advice, or other support for military activities, to any group or
individual, not a part of a country's armed forces, for the purpose of
overthrowing the government of Nicaragua or provoking a military exchange
between Nicaragua and Honduras.

     Representative Boland said that this substitute was substantively
identical to the restriction contained in the classified annex to the earlier
enacted Intelligence Authorization Act and that it had been accepted by the
Administration.  "They do not like it," he said, "but it is agreeable to
them."

     Representative Harkin countered almost immediately with a substitute of
his own, which differed primarily from Representative Boland's by focusing on
the intent of the recipients of CIA assistance:

None of the funds provided in this Act may be used by the Central Intelligence
Agency or any agency of the Department of Defense to furnish military
equipment, military training or advice, or other support for military
activities, to any individual or group which is not part of a country's armed
forces and which is already known by that agency to have the intent of
overthrowing the government of Nicaragua or of provoking a military conflict
between Nicaragua and Honduras.

     Representative Harkin's substitute was defeated; Boland I prevailed by a
vote of 411 to 0.

     In the Senate, a similar debate took place, but with a different outcome.
On December 18, 1982, by a vote of 58 to 38, that body tabled a proposal
sponsored by Senator Christopher J. Dodd that would have made a "policy
declaration" that "no funds should be obligated or expended, directly or
indirectly, after January 20, 1983, in support of . . . paramilitary groups
operating in Central America."

     Ultimately, the conference committee incorporated Boland I into the
Defense Appropriations Act for fiscal year 1983, which became effective on
December 21, 1982.  Boland I was the law at least until October 1, 1983.

     Within a few months of the enactment of Boland I, however, a dispute
arose between the Administration and some Members of Congress, including
Representative Boland, over the scope of the prohibition.  Representative
Boland and others in Congress contended that the intent of the recipients of
the aid governed the permissibility of assistance.  No group that intended to
overthrow the Nicaraguan Government could receive U.S. assistance, they said.

     The Administration took a more constricted view: as long as the United
States itself was not seeking to overthrow the Sandinista Government, the
objectives of the Contras to replace the Nicaraguan Government were
irrelevant.  As support for its position, the Administration pointed to the
defeat of the second Harkin amendment, which would have barred assistance to
the Contras because of their intent to overthrow the Nicaraguan Government.
While subsequent changes in the Boland amendments ultimately would render moot
this particular dispute, the Administration's willingness, indeed eagerness,
to exploit ambiguities in Boland I presaged its attitude toward the later
Congressional efforts to limit Administration support for the Contras.  In
addition, the aggressive approach by the Administration to this ambiguity
helps to explain why the Boland Amendments evolved toward more restrictive
formulations.

Limited Funding:  December 8, 1983, to October 3, 1984

     As fiscal year 1983 progressed with Boland I in place, the
Administration's support for the Contras continued.  In addition, the
Administration began to expand its justifications for the program beyond the
interdiction of arms to include bringing the Sandinistas to the bargaining
table and forcing free elections.

     As a result, on May 13, 1983, the House Permanent Select Committee on
Intelligence reported out H.R. 2760, a bill to amend the Intelligence
Authorization Act for the then-current fiscal year that would have foreclosed
funding for the Contras.  In language that foreshadowed Boland II, that bill
provided:

None of the funds appropriated for the Central Intelligence Agency or any
other department, agency, or entity of the United States involved in
intelligence activities may be obligated or expended for the purpose or which
would have the effect of supporting, directly or indirectly, military or
paramilitary operations in Nicaragua by any nation, group, organization,
movement, or individual.

     The Senate never voted on H.R. 2760.  Thus, Boland I continued to govern
the Administration's relationship with the Contras through the remainder of
fiscal year 1983.

     While H.R. 2760 was under consideration, however, both the House and the
Senate were working on intelligence authorizations and defense appropriations
for fiscal year 1984.  As reported out by the House Intelligence Committee,
the Intelligence Authorization Bill, H.R. 2968, contained the same provisions
cutting off funding for the Contras as did H.R. 2760.

     Fiscal year 1984 was well under way before H.R. 2968 reached the floor of
the House.  Again members extensively debated the proper policy toward
Nicaragua, and again voted to cut off covert aid, 243 to 171.

     On the Senate side, the intelligence authorization legislation was
reported out of committee without any unclassified restriction on support for
the Contras.  On November 3, 1983, after debate over the Administration's
policies toward Nicaragua, the Senate approved an intelligence authorization
bill that did not restrict assistance for the Contras.

     The conference on the conflicting versions of the legislation was a
pivotal point in the history of aid to the Contras.  After the conference,
Representative Boland explained the opening positions and the outcome to his
colleagues in the House:

As you know, I believe [the Central Intelligence Agency's] paramilitary action
in Nicaragua is illegal, unwise, counterproductive, and against the best
interest of the United States.

I, and a majority of the House conferees, would have preferred that the covert
action be stopped.

This was the position of the House of Representatives.

Just as clearly, it was the position of the Senate conferees and of the Senate
that the action should be permitted to continue and that when appropriated
funds ran out, the Central Intelligence Agency could utilize the reserve for
contingencies unless both Intelligence Committees disapproved.

We could have forced a deadlock and killed both the Intelligence Authorization
Bill and the Defense Appropriations Bill.

But the Central Intelligence Agency would still have been able to fund the
covert action from the Continuing Resolution and from the reserve for
contingencies - and would have had available to it much more than $24 million.
Instead, we agreed to a compromise - a $24 million cap on funding from
whatever source.

     The key to this compromise from the House's standpoint was the amount of
aid provided, enough to carry the Contras "at present rate of expenditure"
only through June 1984.  At that point, according to Representative Boland,
the Administration would have to terminate its covert program or come "back to
both Houses of Congress and request additional funds . . . ."

     The conference language, included in both the Intelligence Authorization
Act (Public Law 98-212) and the Defense Appropriations Act (Public Law 98-215)
for fiscal year 1984, read:

During fiscal year 1984, not more than $24 million of the funds available to
the Central Intelligence Agency, the Department of Defense, or any other
agency or entity of the United States involved in intelligence activities may
be obligated or expended for the purpose or which would have the effect of
supporting, directly or indirectly, military or paramilitary operations in
Nicaragua by any nation, group, organization, movement, or individual.

     Significantly, these pieces of legislation, which became effective on
December 8 and December 9, 1983, included within the $24 million cap all funds
expended to assist the Contras from the beginning of the fiscal year on
October 1, 1983.  Thus, by the time these enactments became law, there was
already less than $24 million that could be provided by the covered agencies.

Boland II:  October 3, 1984, to December 3, 1985

     The period between October 12, 1984 (the effective date of Boland II),
and August 8, 1985 (the effective date of the legislation providing for
"humanitarian aid"), was the high-water mark of restrictions on assisting the
Contras.  During this period, the covered agencies and entities were
proscribed from expending any funds whatsoever to support, directly or
indirectly, those resistance forces.

     But Boland II was itself a compromise.  As will be seen, even as Congress
shut off aid at the beginning of fiscal year 1985, the Senate insisted on
providing a procedure that might expedite support for the Contras after
February 28, 1985, upon the passage of a joint resolution. An important
question would also arise after the Committees began their investigation as to
the application of Boland II to the NSC and its staff. As before, an
examination of the events leading to this version of the Boland Amendment is
essential to its understanding.

The Evolution of Boland II

     A major factor in the formulation and passage of Boland II was the
revelation regarding the mining of Nicaraguan harbors.  On April 6, 1984, The
Wall Street Journal reported the CIA's involvement in that mining.
Additionally, the CIA's role in military attacks on Nicaraguan oil facilities
at the port of Corinto was soon thereafter revealed.

     Many Members of Congress expressed astonishment at these revelations. A
dispute arose as to whether CIA Director Casey had adequately notified the
Intelligence Committees.  Senator Goldwater, Chairman of the Senate Committee,
protested to Casey.  National Security Adviser Robert McFarlane responded that
Congress had been adequately briefed about the mining.  In support of Senator
Goldwater's position, his vice-chairman, Senator Moynihan, resigned from that
post, only to be persuaded to stay on.  Both the Senate and the House
ultimately voted to condemn the CIA's involvement in the incident.  The
revelations also produced an intense negative international reaction,
particularly when Nicaragua sued the United States in the International Court
of Justice alleging, and ultimately proving to the satisfaction of that court,
that the United States violated international law.

     As the end of fiscal year 1984 approached, the House considered an
Intelligence Authorization Bill (H.R. 5399), and a Continuing Appropriations
Bill (H.J. Res. 648), both of which prohibited the use of any funds available
to the CIA, DOD, or any entity involved in intelligence activities to support
"directly or indirectly" military or paramilitary operations in Nicaragua.
The prohibitory language was identical to that contained in H.R. 2760, the
House's earlier, unsuccessful attempt to amend the Intelligence Authorization
Act for fiscal year 1983.  The House debated this version of the Boland
Amendment on August 2, 1984, and passed it by a vote of 294 to 118.

     On the Senate side, the majority once again defeated an effort to include
a parallel prohibition in that Chamber's version of intelligence authorization
legislation.  The vote, which took place after lengthy debate on October 3,
1984, was 42 in favor of including such a prohibition and 57 against.

     The conferees ultimately agreed to adopt the House prohibition, but to
couple it with an explicit promise to revisit the issue in another 4 months.
As finally enacted, Section 8066 of Public Law 98-473, the Continuing
Appropriations Act for fiscal year 1985, read:

     (a)  During fiscal year 1985, no funds available to the Central
Intelligence Agency, the Department of Defense, or any other agency or entity
of the United States involved in intelligence activities may be obligated or
expended for the purpose or which would have the effect of supporting,
directly or indirectly, military or paramilitary operations in Nicaragua by
any nation, group, organization, movement, or individual.

     (b)  The prohibition concerning Nicaragua contained in subsection (a)
shall cease to apply if, after February 28, 1985 -

     (1)  the President submits to Congress a report -

     (A)  stating that the Government of Nicaragua is providing material or
monetary support to anti-government forces engaged in military or
paramilitary operations in El Salvador or other Central American countries;

     (B)  analyzing the military significance of such support;

     (C)  stating that the President has determined that assistance for
military or paramilitary operations prohibited by subsection (a) is necessary;

     (D)  justifying the amount and type of such assistance and describing its
objectives; and

     (E)  explaining the goals of United States policy for the Central
American region and how the proposed assistance would further such goals,
including the achievement of peace and security in Central America through a
comprehensive, verifiable and enforceable agreement based upon the Contadora
Document of Objectives; and

     (2) a joint resolution approving assistance for military or paramilitary
operations in Nicaragua is enacted.

     According to the conferees, up to $14 million in aid to the Contras could
be made available upon passage of the joint resolution described in Section
8066(b).

     Representative Boland reported to his colleagues that:

the compromise provision [Section 8066] clearly ends United States support for
the war in Nicaragua.  Such support for the war can only be renewed if the
President can convince the Congress that this very strict prohibition should
be overturned.

Responding to an inquiry from another Member, Representative Boland specified
"there are no exceptions to the prohibition."  Representative Boland plainly
viewed the conference compromise as terminating all U.S. Government assistance
of any kind until Congress revisited the issue.

     On the other side of the Capitol, the Senate emphasized that the
prohibition was not necessarily permanent.  As Senator Ted Stevens described
it, the compromise did not cut the Contras' lifeline, but rather "[put] off
the decision until next year."  Reacting to a pessimistic assessment from
Senator John P. East, he continued:

Under these circumstances, I do believe the Senator would be unwise to send a
message to the Sandinistas that we have abandoned completely support for the
Contras.  We have set in motion a process by which the President can once
again trigger support for the Contras should the Sandinista government persist
[in exporting revolution].

                  *         *         *         *         *

I say to my friend we did not win and we did not lose . . . what we are saying
to the Sandinistas is, "we have a period of time here because of our internal
process and our process of selecting our leader for the next four years . . .
and you are put on notice that if the President asks for this money on
February 28 . . . we can approve it."

In the interim, according to Senator Stevens, the Contras would be able to tap
other sources of support:

The Contras [already] are supporting themselves with assistance they are
getting from elsewhere in the world.  Having that assistance out there to be
made available on March 31 will encourage that assistance from other sources
to the Contras during this period.

     Thus, while House conferees hailed Boland II as a victory in the effort
to end U.S. involvement in Nicaragua's civil war, the Senate conferees billed
it as a draw or, at worst, a temporary setback to be overcome after the
Presidential election.  But not even Senator Stevens suggested that entities
within the U.S. Government could continue covert support for the Contras after
enactment of Boland II.

     As it turned out, Congress never approved the $14 million allocation.
President Reagan made the necessary certification under Section 8066 early in
April 1985.  The Senate approved the joint resolution on April 23, 1985, by a
vote of 53 to 46.  The measure failed in the House, however, by a vote of 180
to 248.  As a result, no funds should have been expended by covered entities
to support the Contras from the exhaustion of the $24 million appropriation
sometime in June, 1984, to the effective date of legislation providing
humanitarian aid, August 8, 1985.

Boland II and the NSC Staff

     Unlike Boland I, which applied by its terms solely to the CIA and the
DOD, Boland II also applied to "any other agency or entity . . . involved in
intelligence activities."  After this investigation began, members of the
Administration asserted that Boland II did not apply to the NSC staff.  The
Committees disagree, and note that this assertion never was made publicly
prior to this investigation.

     By its terms, Boland II reached any agency "involved in intelligence
activities."  Thus, Boland II did not put just the CIA out of the Contra
support business; it prevented other government agencies from covertly taking
the CIA's place.

     The Administration has asserted that Boland II did not apply to the NSC
staff because: (1) the NSC does not traditionally engage in intelligence
activities; and (2) the phrase "agency involved in intelligence activities" is
a statutory term of art which does not include the NSC.  These post hoc
arguments are not persuasive for a number of reasons.

     The statutory language is clear on its face: if an agency is "involved in
intelligence activities," then it cannot engage in the proscribed conduct of
assisting the Contras.  That Boland II did not specifically mention the NSC is
of no consequence.  The statute mentioned by name those agencies which
Congress knew would be engaged in intelligence activities, and included a
"catch-all" provision to describe all other agencies that were intended to
fall within Boland II's reach.  This "catch-all" provision is no statutory
term of art.  Rather, the phrase used by Congress - "any other agency or
entity . . . involved in intelligence activities" - is descriptive.  For
instance, had the NSC staff remained true to the NSC's traditional statutory
functions of coordination and oversight, Boland II would not have applied to
its activities.

     Thus, the law could not be evaded by assigning the prohibited activities
or the persons engaged in those activities to a government agency that
typically did not engage in "intelligence activities."  Any other
interpretation would have rendered the law meaningless.  The target of Boland
II was not the CIA, but any covert operation supporting the Contras, directly
or indirectly.  Shifting responsibility from the CIA to the NSC staff would
have accomplished nothing, other than to change the personnel running the
Contra support operation.

     North and Poindexter, however, both testified that there was discussion
among the NSC staff after Boland II was adopted that it did not apply to the
NSC staff.  No documentary evidence exists, however, to suggest that this
interpretation was ever put forward before August 1985.  On the contrary,
North's memos and McFarlane's and Poindexter's responses in late 1984 and
early 1985 reflect a sensitivity that, at least for the record, the NSC staff
had to comply with Boland.  McFarlane in his public testimony scoffed at the
view that Boland II did not apply to the NSC staff - even though, because
McFarlane had not sought immunity, it was in his interest to deny Boland's
applicability.

     If North and Poindexter had any doubt about the reach of Boland II, they
could have obtained legal opinions.  The Office of Legal Counsel of the
Department of Justice exists to provide legal opinions to the executive
branch.  The Counsel to the President also renders legal opinions on statutory
interpretation; and the Attorney General issues both informal and formal
opinions from time to time.  But the Justice Department, the Counsel to the
President, and the Attorney General were never asked for legal opinions on
whether Boland II applied to the NSC staff.

     North testified that Professor John Norton Moore of the University of
Virginia gave him an opinion that Boland II did not apply to the NSC. Moore is
a distinguished professor of law who has written extensively on Executive
power.  His opinion would carry weight.  But Moore has denied that he had ever
been asked for or given an opinion on the applicability of Boland II.  No
written evidence of such an opinion exists.

     Because McFarlane headed the NSC staff as National Security Adviser at
the time Boland II was enacted, his contemporaneous interpretation of the
applicability of Boland II to that staff carries considerable weight.
According to McFarlane:

. . . The law expressly foreclosed even a liaison role for the CIA, or for the
Defense Department.

I interpreted it as well that the NSC was not to itself get involved in
military or paramilitary activities or replicating the CIA function in those
domains.

Indeed, McFarlane acted on this interpretation.

     Such a contemporaneous reading carries the most weight when, as in this
matter, the official making the interpretation informed Congress of it.
McFarlane's correspondence with Representative Lee H. Hamilton, Representative
Michael D. Barnes, and Senator David Durenberger all reflected his
understanding.

     Legal analysis available at the time reached the same conclusion.  An
undated memorandum prepared by the Congressional Research Service of the
Library of Congress in response to an inquiry dated August 13, 1985, found
"strong, if not conclusive evidence that the [language] was intended to apply
to the National Security Council."  Similarly, a staff memorandum prepared for
Representative Henry J. Hyde, which the FBI later found in North's files,
explained that the "NSC is clearly a U.S. entity involved in intelligence
activities, subject to the Section 8066(a) prohibition."

     The opposing view, that the Boland prohibition did not apply to the NSC
staff, found its only contemporaneous expression in an opinion by Bretton
Sciaroni, counsel to the Intelligence Oversight Board.  During Sciaroni's
testimony, however, questions were raised about his qualifications to render
this opinion.  He had never practiced law before becoming the Board counsel.
This written opinion was his first on legislation.

     More importantly, Sciaroni based his opinion on certain key factual
premises that turned out to be incorrect.  Addressing the statute's language,
Sciaroni admitted in his opinion that, "on the face of it the NSC would appear
to be an agency or entity of the United States covered by the amendment."  He
concluded that the NSC was not an agency or entity "involved" in intelligence
activities from the factual premise that "it is a coordinating body with no
operational role," so that the NSC "does not function as an operational unit."

     North, however, confirmed that he had been conducting the "full-service
covert operation," depicted in extensive evidence before the Committees.  By
itself, this assertion put the NSC within Boland II's coverage of "any agency
or entity of the United States Government involved in intelligence
activities."

     Asked at the hearings, "[were you] told at that time that [the NSC staff
was, in fact, involved in intelligence operations?"  Sciaroni responded, "No,
I was not told that."  He explained more fully:

     Q:  Well, I am simply asking you, sir, isn't it true that the conclusion
[of your opinion] was based on failure to communicate information to you?

     A:  True.

     Q:  You didn't have the facts?

     A:  That is true.

     Q:  And it was the incorrect facts in part upon which your opinion was
based?

     A:  That is absolutely correct.

     In any event, the Sciaroni opinion was not unveiled until long after
North's activities began to unravel.  Poindexter acknowledged his reason for
keeping its conclusion under wraps:  fear that if Congress learned that the
NSC staff was even entertaining the notion that it was exempt from Boland II,
Congress would act to eliminate any such misconception.  Instead, Congress was
told that the NSC staff was observing the letter and spirit of Boland.

     In August 1985, the House and Senate Intelligence Committees and the
House Foreign Affairs Committee each inquired about the activities of the NSC
staff and of North.  McFarlane replied that the NSC was complying with the
letter and spirit of the law.

     Poindexter denied that he saw this response at the time, although the
record shows that he assembled the team to handle the response and that he was
sent a draft for comment.  He claimed that, when he finally saw the McFarlane
draft in the Tower Review Board Report, he was surprised by its language.

     But, in the summer of 1986, the House Intelligence Committee would
conduct another inquiry of North, an inquiry Poindexter deflected by noting
that McFarlane had previously certified that "the actions of the National
Security Council staff were in compliance with both the spirit and the letter
of the law regarding support of the Nicaraguan resistance."

     The message to Congress was clear and consistent: Boland II did not need
clarification.  It covered the NSC, which "was complying."  Indeed, no one
expressed this more forcefully than McFarlane at the public hearings:

And I think also that the evidence that surely I did believe that the Boland
Amendment applied to the NSC staff is expressed in the fact that otherwise why
would we have worked so hard to get rid of it after it was passed?  If we felt
that we were not covered, what was I doing?  What were we doing coming up here
day after day trying to get rid of it?

     Even by its terms, the Sciaroni opinion did not give North - or
Poindexter - a clean bill of health.  Sciaroni noted that if North's salary
was borne by the DOD, an entity expressly named in Boland II, he could be
subject to its restrictions.  This, in fact, was the case.  Referring to this
caveat in Sciaroni's opinion, Poindexter testified in his deposition that, "we
were willing to take some risks in order to keep the Contras alive . . . ."

The Meaning of "Indirect" Support

     Boland II prohibited the obligation or expenditure of appropriated funds
"for the purpose or which would have the effect of supporting" the Contras
"directly or indirectly."  Viewed narrowly, this statute forbade only the
provision of government money or material to the Contras.

     Representative Boland, on the other hand, read his amendment more broadly
at the time of its enactment so as to give meaning to the phrase "directly or
indirectly":

Let me make very clear that this prohibition applies to all funds available in
fiscal year 1985 regardless of any accounting procedure at any agency.  It
clearly prohibits any expenditure, including those from accounts for salaries
and all support costs.  The prohibition is so strictly written that it also
prohibits transfers of equipment acquired at no cost.

     Opinions issued by the Comptroller General of the United States in other
contexts would seem to confirm Representative Boland's interpretation.
Moreover, McFarlane candidly told the Committees that, during his tenure as
National Security Adviser, he understood that Boland II precluded any
assistance by the NSC staff to the Contras.

     Once again, North took a position contrary to that of his former boss.
After describing his "full-service covert operation," North agreed on the one
hand that the Boland Amendment applied to "U.S. Government funds":

And my understanding - and I have not read Boland, the Boland amendments in
some time, but my understanding then was that what we could not do is take and
expend funds which had been made available to the CIA and the DOD, et cetera,
for the purpose of providing direct or indirect support for military and
paramilitary operations in Nicaragua.

That is a memory that is over seven months old, but I think that was what the
intent was.

Certainly the way we pursued it and we made every effort not to expend U.S.
Government funds to support the Nicaraguan resistance . . .

On the other hand, North did not count fixed operating costs, such as his
appropriated salary, as covered by the Boland II prohibition:

     Q:  You were aware, I take it, that salaries were included in the Boland
Amendment?

     A:  No - not mine.

But, as noted above, Representative Boland clearly considered salaries within
the ambit of the legislation he sponsored.

     The historical background provides the reason for Boland II's
comprehensive coverage.  Boland II had emerged in reaction to the revelation
of the CIA's role in the mining of Nicaraguan harbors.  At that time, the CIA
had allegedly exceeded the $24 million limit in conducting that operation.
According to reports, the CIA had attempted to obscure this overrun by
charging to its overall operating budget the $1.2 million cost of a vessel
deployed during the mining of the harbors.  Representative Boland's
explanation that the amendment "clearly prohibits any expenditure, including
those from accounts for salaries and all support costs" anticipated and
rejected use of a rationalization similar to North's by which costs charged to
an "overall operating budget" were ignored for determining compliance with a
funding cutoff.  The prohibition against the CIA funds "available" to it
precluded that agency from using its contingency reserve or any funds at its
disposal.

     In the Committees' view, Boland II had a discernible purpose: to end
covert support for the Contras by the United States.  Once the NSC staff
became involved in intelligence operations and continuing covert, albeit
quasi-private, assistance to the Contras, both the letter and spirit of Boland
II were violated.