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At White House direction, Vaught began planning Honey Badger, a second rescue attempt uniting aviation and intelligence in a predominantly Army operation. The Army developed special equipment: one-man satellite- communications radios, Black Hawk helicopters modified to fly longer distances, and what one source describes as "very small, very capable, very exotic" 500MD helicopters equipped with advanced navigation and communications capabilities. But by then, the U.S. could never pin down the location of any group of hostages long enough to mount a rescue.
Nonetheless, the Army's top command -- particularly Chief of Staff General Edward Meyer and Vice Chief General John Vessey -- had become committed to secret operations. When the Reagan Administration took office, the generals made the new ad hoc groups permanent. In early 1981 Colonel James Longhofer, who had worked on Honey Badger, was assigned to head an expanded office of special operations to oversee various types of unconventional missions. One of its field units was Seaspray, jointly commanded by the Army and the CIA, which took over the special helicopters developed for the Iran rescue mission. The Pentagon dutifully briefed key members of Congress, who agreed to put up $90 million to fund the new office.
But Congress was not told that $20 million of that sum went to set up a supersecret intelligence unit, the ISA, under the command of Colonel Jerry , King. (The role of regular Army intelligence is to collect tactical military information, not to lay the ground for covert operations.) ISA initially was to act as a pathfinder for secret missions, but its functions quickly expanded. When General William Odom became assistant chief of staff for intelligence in late 1981, he argued persuasively that ISA was needed to fill gaps in the CIA's activities. Its personnel grew from about 50 at the start to 283 in 1985. At its peak it had agents in Morocco, Nigeria, Somalia, Sudan and some ten Latin American countries. In Panama, for example, it operated a refrigeration company that served as a front for its agents. One ISA mission was to map out the routes U.S. rescue teams would take to reach American embassies likely to be seized by terrorists.
From the beginning, friction arose between King's ISA and Longhofer's operations units. In 1981 they cooperated with the CIA on a mission to slip Christian Leader Bashir Gemayel back into Lebanon after a secret visit to the U.S., foiling a suspected Syrian plot to kill him. Gemayel made it (though he was assassinated one year later). But while the Seaspray-ISA team was in Egypt coordinating the mission with the Israelis, a special operations officer spotted an ISA man taping their discussions, on King's orders. "Young man," the officer reportedly thundered, "this is a CIA mission. Either you put that ((tape recorder)) away or I'm going to smash it."
The following year, ISA and Seaspray worked together on a mission, code- named Queens Hunter, to locate leftist guerrilla forces in El Salvador by monitoring their radio transmissions. Seaspray pilots flew planes from Honduras to track the transmitters electronically; ISA agents rode along to operate the airborne radio equipment. Although the operation was planned to last only a month, it picked up so much useful information on where the guerrillas were hiding that it was extended for three years.