An embarrassed National Reconnaissance Office today defended itself against charges that it has squirreled away more than $1 billion that it had received, but never spent. The NRO, a Pentagon-CIA hybrid that operates under a secret "black" budget, explained that its satellite projects often take several years to complete and thus may produce a large budget surplus in any given year. "Congress has long had a dispute with the Defense Department over unspent funds," says national security correspondent Douglas Waller. "Agencies sometimes find themselves physically unable to write the all the checks for the money they are appropriated." The NRO says it has never spent money on activities not approved by Congress, but legislators will largely have to the agency's word for it. "What this shows," says Waller, "is the difficulty of keeping track of spending once they go into these 'black' programs."