The Department of Homeland Security will proceed with the first phase of a controversial satellite-surveillance program, even though an independent review found the department hasn't yet ensured the program will comply with privacy laws. Congress provided partial funding for the program in a little-debated $634 billion spending measure that will fund the government until early March. For the past year, the Bush administration had been fighting Democratic lawmakers over the spy program, known as the National Applications Office. The program is designed to provide federal, state and local officials with extensive access to spy-satellite imagery. Since the department proposed the program a year ago, several Democratic lawmakers have said that turning the spy lens on America could violate Americans' privacy and civil liberties unless adequate safeguards were required. A new [but classified] 60-page Government Accountability Office report said the department lacks assurance that NAO operations will comply with applicable laws and privacy and civil liberties standards." The report cites gaps in privacy safeguards. The department, it found, lacks controls to prevent improper use of domestic-intelligence data by other agencies and provided insufficient assurance that requests for classified information will be fully reviewed to ensure it can be legally provided. But the bill Congress approved, which President George W. Bush signed into law Tuesday, allows the department to launch a limited version.