Legislative Notice 11

May 2, 1997

Reported by the Commitee on Appropriations on April 30, 1997, by a mostly party-line vote of 16-12 (Senators Boxer and Dorgan voted yea; Senator Gregg voted nay). (S. Rept. 105-16)

• S. 672, the Senate bill, as reported, includes $7.7 billion in discretionary spending and total rescissions of $7.7 billion which offsets the new discretionary budget authority recommended in the bill (see chart, page 10).
• The bill includes $5.6 billion in emergency appropriations for natural disasters, $1.8 billion for defense accounts, and $274 million in non-emergency discretionary supplemental funds.
• The bill includes $753 million for veterans compensation and pensions and $125 million for SSI. The bill creates a $125 million block grant to provide SSI benefits for elderly and disabled legal immigrants to meet anticipated demands for an additional two months beyond the August 22 statutory eligibility cutoff created by last year's welfare reform bill. This provision was added at the request of the leadership.
• S. 672 contains language providing "safety net" continuing resolution for FY98 to prevent a government shutdown in the event the regular annual appropriations acts are not enacted into law by October 1, 1997, with funding at 98 percent of the previous year's appropriations. A motion to strike this provision is anticipated.
• Also, S. 672 includes language (1) to waive endangered species provisions for the operation and repair of flood control projects damaged by recent floods; (2) to bar funding for the use of sampling data in the next census; and (3) to tighten last year's moratorium on Interior's effort to revoke certain rights-of-way on federal lands. Expect floor amendments on these issues.

Listed below are the major components of S. 672:

Spending

$1.8 billion, Bosnia peacekeeping

$5.6 billion, disaster assistance (includes $3.5 billion for FEMA and 547 million for Army Corps of Engineers)

$197 million, national park repairs

$125 million, SSI assistance to legal aliens

$100 million, UN payment

$58 million, WIC program

$31 million, D.C. schools and police

Offsets

$1.8 billion rescissions and unused defense funds

$3.65 billion rescission in public housing funds

$778 million unused airport improvement funds

$588 million unused rail and bus funds

$365 million rescission in NASA facilities funds

$271 million unused transit funds

$85 million rescission in FHA general program

$30 million reduction, Corps of Engineers

$28 million rescissions, Energy Department (clean coal $17 million; SPR $11 million)

The House Appropriations Committee reported their supplemental bill, H.R. 1469, on April 29th, and the House is expected to consider it on Wednesday, May 7th.

Title I--Department of Defense

Appropriations

• The Committee appropriated a total of $1.8 billion as follows: $1.7 billion for contingency operations in Bosnia and Southwest Asia; $20 million for POW payments and $72 million for the Reserve Mobilization Income Insurance Fund and $50 million (see Section 103) plus $6.5 million (see Section 105). This is $293 million less than the requested amount of $2.1 billion, which included $2 billion for Bosnia and Southwest Asia.
• In providing the funding, however, the Committee funded military personnel requirements for the Bosnia and Southwest Asia operations from the respective service (Army, Navy, Marine Corps, and Air Force Military Personnel) accounts, and included only operations and maintenance funding in the "Overseas Contingency Operations Transfer Fund" account.
• The Committee also believes that the request for drawdown recovery costs should not be included under the emergency appropriation designation. However, it decided to provide funding for drawdown costs linked to either Bosnia or Southwest Asia, and encouraged the DoD to resubmit the remaining requirements for reprogramming consideration.
• Changing past procedure, the Committee directed a subdivision of the Overseas Contingency Operations Transfer Fund to identify costs by individual contingency operation, with the requirement that the Under Secretary of Defense (Comptroller) notify the Committee 30 days prior to the DoD expecting to exceed the total allotment for a given contingency. This change was proposed to place cost controls on contingency operations. At the same time, the quarterly reporting requirement is retained.
• The Committee report includes a "General Provision" (Sec. 106) prohibiting the obligation of any funds in support of operations or activities in Bosnia 60 days after enactment of this act, unless the President submits a comprehensive cost report to Congress outlining all expenditures in Bosnia since December 1, 1995.

Department of Defense Offsets

The Committee recommends a number of rescissions to fully offset the cost of contingency operations and funding increases requested by the DoD. They are as follows:

- $389 million, based on the increased value of the dollar relative to foreign currencies in countries where the DoD operates;

- $284 million, based on lower than projected levels of inflation; and,

- $225 million from "expiring balances," where appropriation amounts in individual accounts will expire because the funds remain unobligated when the period of availability ends.

• In addition, the Committee recommends rescissions totaling $666 million from certain programs based on program delays, contract savings, reevaluation of project priority, slow execution, or program restructuring. Some of these are:

- $69 million from the 1997 Army Missile Procurement account for the Army Tactical Missile System (ATACMS);

- $150 million from the 1997 Air Force Missile Procurement account for the Titan IV program restructure;

- $100 million from the 1997 Air Force's Research, Development, Test and Evaluation (RDT&E) classified program; and,

- $80 million from the National Imaging and Mapping Agency's (NIMA) RDT&E, Defense-Wide, 1997 account.

• The Committee specifically denied the administration's request to rescind $62 million of FY 1997 funds appropriated for the "National Guard and Reserve equipment" account, and directs that these funds be immediately released to the National Guard Bureau for programmed obligations.

Title II--Natural Disasters and Other Emergencies

Department of Agriculture

• Emergency Conservation Program: $77 million ($40 million over the President's request) to provide cost-sharing assistance to farmers and ranchers whose farmland was damaged by flooding and other natural disasters.
• Watershed and Flood Prevention Operations: $161 million ($76.9 million over the President's request) to reduce hazards to life and property in watersheds damaged by recent and prior-year disasters.
• Rural housing assistance ($4 million) and rural utilities assistance ($6.5 million).
• Forest Service: $67.4 million for construction and repairs to the national forest system.

Department of Commerce

• Economic Development Assistance: $54.7 million for emergency grants, of which $45 million is to provide assistance to areas whose economies have been undermined by natural disasters and other dislocations.
• National Oceanic and Atmospheric Administration: $10.8 million for severe damage to fish hatcheries in the Pacific Northwest due to flooding and other natural disasters.

Department of Defense

• Corps of Engineers: Total of $547 million, including $390 million for flood control and coastal emergencies; $20 million for dredging and emergency flooding needs in the lower Mississippi River and its tributaries as a result of the severe flooding in the Ohio River basin; and $137 million for repairs of damage caused by the winter flooding in the Pacific Northwest, California, Texas, and Ohio River Valley to navigation channels and harbors, locks and dams, reservoirs, and flood control channels.

Department of Interior

• Bureau of Reclamation: $7.4 million to repair damage to facilites that occurred during the winter flooding in the western States, particularly California and Nevada.
• Bureau of Land Management: A total of $4.8 million (of which $4.4 million is derived by transfer of unused funds) for road and bridge repairs due to snow and flood damage.
• U.S. Fish and Wildlife Service: $91 million for construction; $5 million for land acquisition; and $3.4 million for resource management.
• National Park Service: $187.3 million, of which $176 million is for the repair and replacement of facilities and grounds at Yosemite National Park. Also, Title II of the bill provides an additional $10 million nonemergency appropriation for phase 2 of the Yosemite transportation plan proposed by the administration (which is offset by a rescission of clean coal technology funds).
• U.S. Geological Survey: $4.7 million for repair at hydrologic streamflow measurement stations.
• Bureau of Indian Affairs: $20.5 million for operation of Indian programs and emergency construction repairs related to flood and snow damage. Also, the Committee provides $3 million to the Indian Health Service (no funds were requested by the administration).

Department of Transportation

• Federal Highway Administration (FHA): $650 million for emergency relief activities of the FHA to repair highway damage resulting from floods. The Committee has included bill language lifting the $100 million limit on obligations per state for the December 1996-97 flooding in impacted states.
• National Transportation Safety Board (NTSB): $14.1 million for the TWA flight 800 accident investigation costs directly attributable to the NTSB.

Department of Housing and Urban Development

• Community Planning and Development: $100 million for community development block grant funds to remain available until September 30, 2000, for emergency expenses resulting from flooding.

Federal Emergency Management Agency

• For FEMA disaster relief, $3.5 billion to cover the current estimate of the costs arising from disasters occurring in FY97 and including those projected for the balance of FY97 based on the 5-year historical average cost of disaster relief. Bill language is included prohibiting the expenditure of $2.5 billion of the funds provided herein until the FEMA Director submits his legislative proposal to control disaster relief costs (see below). The Committee notes that sufficient funds are made available to meet all anticipated obligations this fiscal year.
• According to the committee report, "The number of major disaster declarations in the 1992-96 period has increased 54 percent above the preceding 5-year period; and FEMA's calculation of the 5-year historical average cost of disaster relief for FY98, excluding the Northridge earthquake, is $2.3 billion, an increase of 28 percent over last year's 5-year average of $1.8 billion. FEMA acknowledges that the escalation in costs is due not only to the increase in large-scale disasters, but also because 'the scope of Federal disaster assistance has expanded, the Federal role in response has expanded considerably, and State and local governments are increasingly turning to the Federal Government for assistance'." In response to repeated congressional directives to submit proposals to reform this program to be fiscally responsible, the FEMA Director has committed to submitting a comprehensive proposal, including proposed legislation, by July 4, 1997. The committee report goes on to say, "Should the Agency fail to meet this deadline, the Committee will be forced to take steps to effectuate cost savings at FEMA, including a reduction to FEMA's operating programs.

Department of Health and Human Services

• Public Health and Social Services Emergency Fund: $15 million for the purpose of supporting multicenter research studies on environmental risk factors associated with breast cancer and factors related to regional variations in breast cancer incidence and mortality. The Committee requests the Secretary to provide a report on the research plan and allocation methodology accompanying these additional funds by July 1, 1997.

Title III--Other Supplementals

Department of Agriculture

• Farm Service Agency: $12.6 million to subsidize the cost of farm operating direct loans. This amount will fund an estimated additional $100 million in direct loans for FY97.
• Food and Consumer Service: $58 million for the special supplemental nutrition program for Women, Infants, and Children (WIC). This additional amount is sufficient to fund the estimated 444,000 shortfall in state agency projected caseload maintenance requirements for the balance of FY97.

Department of State

• International Organizations and Conferences: $100 million as a down payment for the United Nations intended to bolster diplomatic efforts to negotiate a reduction in U.S. contributions to the U.N. However, the bill prohibits the obligation or expenditure of the money until specifically authorized. Also, the Secretary of State is directed to report to the Committee on its success in lowering our arrears to the U.N. not later than June 15, 1997, and to report a list of offsets for any outstanding arrears which the administration wishes to fund in FY98 or future years.

District of Columbia

• Federal Payment to the District of Columbia: $31.2 million, of which $22.4 million is for emergency capital improvements to those D.C. public school facilities that have the most immediate facility improvement needs. The balance of $8.8 million is for the Metropolitan Police Department to be used for a 10-percent pay raise for police officers.

Department of Interior

• National Park Service: $10 million in nonemergency funds for implementation of phase 2 of the Yosemite Vally transportation plan. This amount is offset by a rescission of funds from the clean coal technology program.

Department of Transportation

• Coast Guard: $6.5 million for TWA flight 800 accident search and rescue, salvage operations support, etc; and $4.2 million for Coast Guard retired pay.
• Federal Avaiation Administration: $15.5 million for the grants-in-aid for airports to make funds available for the unanticipated costs incurred by state and local agencies related to support efforts in the 1996 ValuJet flight 592 and TWA flight 800 air tragedies.
• Federal Highway Administration: $933.2 million in additional Federal-aid highway obligational authority for FY97.

U.S. Postal Service

• Payment to the Postal Service Fund: $5.4 million in FY98 for payment to the postal service fund.

Federal Election Commission

• Although the President requested $1.7 million for "startup costs associated with investigations and audits pursuant to the Federal Election Campaign Act," the Committee did not provide any funds.

Department of Education

• Education for the Disadvantaged: $198.2 million in additional funding for Title I grants to local education agencies to prevent some of the poorest states from losing Title I funds due to the Department's decision to use a blended rate in calculating Title I allocations.

General Provisions

Chapter 10 the Committee Report contains 25 general provisions, including the following:

• 2000 Census: The Committee specifies that none of the funds made available in any appropriations act for FY97 may be used by the Department of Commerce to plan or otherwise prepare for the use of sampling in taking the 2000 decennial census.
• Rights-of-Way: Section 310 tightens the language included in last year's omnibus appropriations bill that imposed a permanent moratorium on the Department of Interior's efforts to issue new rules changing existing rights-of-way that were established on federal lands prior to 1976.
• Endangered Species Act Waiver: Section 311 allows for immediate repair and operation of federal flood control projects that were damaged during 1996 and 1997 by waiving the requirements of the Endangered Species Act for formal consultations under the Act and protecting persons operating and repairing the projects from the "takings" provisions in the Act.
• Small Business Delay: Section 322 prohibits the Internal Revenue Service (IRS), between July 1 and December 31, 1997, from imposing or enforcing penalties on small businesses who are not in compliance with the electronic federal tax payment system (EFTPS). This provision will protect small businesses against potential penalties of 10 percent on each tax payment that does not completely meet the requirements of EFTPS.
• Repeal of Section 1555 of the Federal Acquisition Streamlining Act: Section 323 repeals section 1555 which provides state and local governments with the ability to purchase goods and services from the federal supply schedule managed by the General Services Administration. Due to problems with the provision, Congress mandated a moratorium on its implementation. The Committee believes that section 1555 is likely to result in increased costs to the Federal Government and recommends that the section be repealed..

Social Services Block Grant

• Title VI of the bill creates a social services block grant to provide temporary SSI benefits for elderly and disabled legal immigrants. The Committee provides $125 million to assist states and local goverments to meet anticipated demands for an additional two months beyond the August 22 statutory eligibility cutoff created by last year's welfare reform bill. Further action on this matter is expected to be considered by the authorizing committee.

Government Shutdown Prevention Act

• Title VII includes language providing continuing appropriations for FY98 at 98 percent of the 1997 levels in the event the regular annual appropriations acts are not enacted into law by October 1, 1997. The text is the same as S. 547 introduced by Senators McCain, Hutchison, Lott, Stevens, Craig, Nickles, Ashcroft, and Warner on April 10, 1997. In introducing the bill, Senator McCain stated that "This bill creates a statutory continuing resolution as sort of a safety net CR, which would trigger only if the appropriation acts do not become law or if there is no governing continuing resolution in place."

As of press time, we do not have a comprehensive list of specific amendments. However, the following amendments to strike provisions in the bill are anticipated.

Bumpers. Strike language that would block implementation of a new Interior Department policy on rights-of-way on federal land.

Byrd. Strike Title VII of the bill that contains the text of S. 547, the Government Shutdown Prevention Act.

Hollings. Strike language that would prohibit funding for the use of sampling data in the next census.

Reid. Strike language waiving formal consultation requirements and "takings" liability under the Endangered Species Act for operating and repairing flood control projects damaged by flooding in 1996 and 1997.

An amendment to add $1.7 million requested by the administration for the FEC may be offered.