Diplomatic Reciprocity and Security Act

Diplomatic Reciprocity and Security Act - Title I: Soviet Embassy in the United States and United States Embassy in the Soviet Union - Declares that the United States withdraws from the agreement with the Soviet Union concerning embassies in Moscow and Washington. Authorizes the President to waive such withdrawal if he determines, and reports to the Congress, that: (1) it is vital to the national security of the United States not to withdraw from the embassy agreement; (2) the U.S. Embassy in Moscow can be safely and securely occupied by the United States and used for its intended purposes; and (3) steps have been or will be taken to eliminate, no later than October 1, 1989, the damage to U.S. national security due to electronic surveillance from Soviet facilities at the Mount Alto site in Washington, D.C., and from other Soviet facilities in the United States. Provides that if the withdrawal from the embassy agreement takes effect the Mount Alto site may not be available for use by a foreign mission for any purpose.

Expresses the sense of the Congress that the current arbitration process between the United States and the Soviet Union should be expanded to include Soviet reimbursement of the full costs incurred by the United States as a result of the intelligence activities of the Soviet Union directed at the new United States Embassy in Moscow.

Requires the Secretary of State to achieve, by October 1, 1989, reciprocity in certain matters for U.S. diplomatic and consular posts in the Soviet Union. Specifies such matters as: (1) the payment of fair market value for goods and services in the Soviet Union; (2) full access to goods and services in the Soviet Union, including utilities; and (3) obtaining real property in the Soviet Union which is equivalent in terms of quantity and quality to the real property used by diplomatic and consular posts of the Soviet mission to the United States. Authorizes the Secretary to take certain measures, including the closing of Soviet diplomatic or consular offices, in order to achieve reciprocal treatment concerning real property. Requires the Secretary to report annually to the Congress concerning actions taken or planned to achieve such objectives.

Requires the Secretary to submit to the Congress a report discussing whether the number of personnel of Soviet state trading enterprises in the United States should be reduced.

Title II: Improving State Department Personnel Practices and Organization to Counter Hostile Intelligence Threats - Requires the Secretary of State to require periodic counterintelligence scope polygraph interviews of the Diplomatic Security Service.

Requires the Secretary to develop and implement a special personnel security program for personnel of the Department of State assigned to U.S. diplomatic and consular posts in high intelligence threat countries who are responsible for security at those posts and for any individuals performing guard functions at those posts.

Requires the Secretary to convene an Accountability Review Board in any case of a serious breach of security involving intelligence activities of a foreign government directed at a U.S. mission abroad.

Prohibits, after September 30, 1989, employment of any national of a Communist country as a foreign national employee at U.S. diplomatic and consular missions in any Communist country. Exempts from such prohibition any foreign national employee who is not permitted access to: (1) U.S. Embassy or consulate grounds, vehicles, or buildings located in the compound of the Embassy or consulate; and (2) the residence, wherever located, of the chief of mission or the deputy chief of mission. Expresses the willingness of the Congress to provide additional funds to the Department of State for the expenses of employing U.S. citizens to replace foreign nationals dismissed as a result of such prohibition.

Requires the Secretary to terminate the retirement benefits of foreign national employees who the Secretary reasonably believes engaged in intelligence activities directed against the United States. Allows the Secretary to waive such requirement on a case-by-case basis if he determines that it is vital to U.S. national security to do so and reports such waiver in advance to the appropriate committees of the Congress.

Requires the Secretary to submit to the Congress a report discussing the advisability of employing foreign nationals at foreign service posts abroad.

Establishes within the Department of State the position of Under Secretary of State for Security, Communications, Construction, and Missions. Provides that such Under Secretary shall be responsible for: (1) the Bureau of Diplomatic Security; (2) the Office of Communications; (3) the Office of Foreign Buildings; and (4) the Office of Foreign Missions.

Replaces the current position of Director of the Office of Foreign Missions with the position of Assistant Secretary of State for Foreign Missions.

Title III: Additional Measures to Protect Against Hostile Intelligence Threats - Authorizes additional appropriations for the Department of State to carry out the diplomatic security program.

Requires the Secretary of State to conduct periodic surveys to determine the weaknesses in the programs, practices, and procedures for protecting classified information at U.S. diplomatic and consular posts, giving priority attention to posts in Communist countries.

Amends the State Department Basic Authorities Act of 1956 to prohibit the acquisition of real property by or on behalf of the foreign mission of an unfriendly country if: (1) in the judgment of the Secretary of Defense, the acquisition of that property might improve the capability of that country to intercept communications involving U.S. diplomatic, military, or intelligence matters; or (2) if in the judgment of the Director of the Federal Bureau of Investigation, the acquisition of that property might improve the capability of that country to engage in intelligence activities directed against the United States.