Statement of Administration Policy: H.R. 2427 - Energy and Water Development Appropriations Bill, FY 1992

(House Floor)
(Sponsors: Whitten (D), Mississippi; Bevill (D), Alabama)

This Statement of Administration Policy expresses the Administration's views on H.R. 2427, the Energy and Water Development Appropriations Bill, as reported by the House Appropriations Committee. On the basis of OMB's preliminary scoring of the bill, the Committee recommendations are within the House 602(b) allocation. In aggregate, the House 602(b) allocations are consistent with the statutory spending limits enacted in the Budget Enforcement Act. However, the Committee's bill shifts domestic resources from critical research and development efforts to various water projects of less national significance.

The Administration's major funding objections are that the bill cuts $100 million from the President's request for the Superconducting Super Collider and $43.5 million from the new Fermilab Main Injector for high energy physics research. The reduction in funding for the Superconducting Super Collider would extend the ten-year design and construction schedule and increase total project costs. This action might also undermine prospects for obtaining international participation in the project. The President's budget assumes that such participation would offset one-third of the total project cost. Reduced funding for the Fermilab Injector would postpone acquisition of the new Main Injector ring for at least one year. Funding at requested levels for these crucial investments in the nation's science infrastructure is needed to ensure America's competitive position in research and development. The Administration strongly opposes an amendment to be offered by Representative Slattery that would eliminate all funding for the Superconducting Super collider.

Instead of providing funding at the requested levels for these crucial investments in research and development, the Committee has provided $115 million more than the President's request to the Army Corps of Engineers. In addition, the Committee has inflated savings and project slippage, and has substituted various low-priority water projects for the Administration's proposed high-priority new construction and major rehabilitation projects. Most of the projects substituted by the Committee are uneconomical, do not meet cost-sharing requirements, or are not Federal responsibilities. Similar objections apply to several Bureau of Reclamation projects.

The Administration strongly opposes section 508, which would bar the use of funds appropriated in the Energy and Water Development Appropriations Bill for the implementation of Public Law 101-576, the Chief Financial Officers Act. This law addresses long-standing Congressional and Administration concerns about financial management deficiencies in the Federal Government. These are deficiencies that must be corrected.

In passing the Chief Financial Officers Act of 1990 (CFOs Act), the Congress found that "[b]illions of dollars...lost each year through fraud, waste, abuse, and mismanagement...could be significantly decreased by improved management." As a remedy, the CFOs Act (passed by voice vote without dissent): (1) strengthens management Capabilities; (2) provides for improved accounting systems, financial management, and internal controls to assure reliable information and deterrence of fraud, waste, and abuse; and, (3) provides for reliable financial information, useful to Congress and the Executive Branch in financing, managing, and evaluating Federal programs. Implementation of the CFOs Act is essential to good Government.

The Administration objects to the language of section 506, which would bar the use of appropriated funds to conduct certain studies of the pricing of hydroelectric power. In signing the FY 1991 Energy and Water Appropriations Bill, the President objected to language identical to the language in section 506 on constitutional grounds. The Constitution grants the President the authority to recommend to the Congress any legislative measures considered "necessary and expedient." Any restrictions on studies would be interpreted so as not to limit the President's ability to carry out his constitutional responsibilities.

More detailed Administration comments on H.R. 2427 are contained in an Attachment.

Attachment

House Floor

H.R. 2427—ENERGY AND WATER DEVELOPMENT APPROPRIATIONS BILL, FY 1992

MAJOR PROVISIONS OPPOSED BY THE ADMINISTRATION

A. FUNDING LEVELS

Department of Defense — Civil: Army Corps of Engineers

—   The Administration objects to the net increase in funding for the FY 1992 Corps of Engineers program of $115 million over the President's request. In addition, the Committee provides funds for the initiation of 19 projects or project elements, restitution of funds for projects, and funds for operation and maintenance of seven additional projects not in the President's budget request. Most of these projects are uneconomical, do not meet cost-sharing requirements, or are not Federal responsibilities. Further, the Committee added over $40 million to initiate over 70 unrequested studies. These projects and studies are funded by a combination of new funds and elimination of the critical Coastal America initiative ($-7 million), elimination of 10 of the President's 11 proposed high priority construction and major rehabilitation new start projects (-$43 million) as well as unjustified savings and slippage (-$43 million).

Department of the Interior: Bureau of Reclamation

—   The Administration objects to the committee's failure to fund the proposed transfer of oversight responsibility for the Bureau of Indian Affairs (BIA) dam safety program to the Bureau of Reclamation. A report by the Department of the Interior Inspector General found that BIA had not effectively managed the program from either an engineering or financial standpoint. BIA has not adequately addressed the serious threats to life and property posed by unsafe dams since issuance of the report in 1989. The Administration proposes to use the technical and management expertise of the Bureau of Reclamation to ensure the timely correction of serious safety deficiencies at a number of high-hazard BIA dams. Indian tribes would participate in implementing corrective actions on reservation dams, including provision for contracting with tribes.

—   The Administration objects to the addition of funds for several projects in the construction program that are a low priority, are not a Federal responsibility, or are inconsistent with costsharing requirements.

Department of Energy

—   The Committee disregarded the Administration's priorities within the Energy Supply Research and Development account. The Administration has requested $28 million for activities related to shutting down the Fast Flux Test Facility (FFTF) reactor in Hanford, Washington. This reactor has no programmatic purpose, and this is the second year that the Administration has proposed closing the reactor. Instead, the Committee cut three Space nuclear power programs (the SP-100 program, the thermal power supply program, and the new Space Exploration Initiative) in order to provide the $79 million to keep the FFTF reactor running for another year.

Other Independent Agencies

—   Tennessee Valley Authority. The Committee bill increases funding by 48 percent over the Administration's request. The increase would continue rural development activities that should be conducted by State or local governments. Further, this unwarranted substantial increase in funding would maintain funding for fertilizer activities that should be made self-supporting and increase natural resource activities that, in part, duplicate the responsibility of other Federal, State and local jurisdictions.

B. LANGUAGE PROVISIONS

Department of Defense — Civil: Army Corps of Engineers

—   Many of the low priority studies and construction projects contained in the Committee bill have specific funding levels and features prescribed in bill language, thereby reducing programmatic flexibility.

—   Section 103 attempts to prohibit non-Federal financing of preconstruction engineering and design costs of certain projects prior to commencement of construction. It is undesirable because joint financing of engineering and design for large complex projects ensures non-Federal sponsors' commitment to project implementation and the timely resolution of design issues.

Department of Energy

—   Power Marketing Administrations. Report language accompanying the Committee bill rejects the Administration's debt repayment reform proposal. The Administration asks the House to reconsider the debt repayment reform proposal. If implemented the proposal is estimated to provide the Federal government an additional $393 million in revenues.

—   Supporting Research and Technical Analysis. The bill directs $3 million to the Midwest Superconductivity Consortium. Neither the Consortium nor the grants given for research under the consortium have undergone competitive review under Request for Proposals open to the entire university community.

—   University Research Support. The bill directs $4 million to the cooperative arrangement that exists among Lawrence Berkeley Laboratory, the Ana G. Mendez Educational Foundation, and Jackson State University. The activities of these institutions are not subject to the normal peer review process to establish the merit of the work performed.

—   Minority Participation in the Superconducting Super Collider. Section 304 of the bill would require that the Secretary of Energy ensure "to the fullest extent possible" that at least ten percent of the funds of the Superconducting Super Collider go to socially and economically disadvantaged individuals within the meaning of the Small Business Act and to universities and colleges with student bodies that are more than 20 percent Hispanic or Native American. This provision does not appear to constitute a rigid set-aside; however, it does direct the Secretary to make an effort to direct funds to specified individuals and groups.

The distribution of Federal funds based solely on the racial composition of an institution's student body is inconsistent with the equal protection component of the Fifth Amendment to the Constitution. Under existing case law, racial or ethnic characteristics justify disparate treatment only in extremely rare situations and such situations must be clearly identified and unquestionably legitimate. The Administration is not aware of any such justification to support this set-aside and therefore recommends its deletion.

General Provisions

—   Limitation on Studies Concerning Hydroelectric Power Rates. Section 506 of the bill would bar the use of appropriated funds to conduct certain studies concerning the pricing of hydroelectric power. The Administration objected to identical language in the FY 1991 appropriation, and the President included in his signing statement the following remarks on the subject:

Section 506 of the Act provides that none of the funds appropriated by [the Energy and Water Development Appropriations Act] or any other legislation may be used to conduct studies concerning "the possibility of changing from the currently required 'at cost' to a 'market rate' or any other noncost-based method for the pricing of hydroelectric power" by Federal power authorities. Article II, Section 3 of the Constitution grants the President authority to recommend to the Congress any legislative measures considered "necessary and expedient." Accordingly, in keeping with the well-settled obligation to construe ambiguous statutory provisions to avoid constitutional questions, I will interpret section 506 so as not to infringe on the Executive's authority to conduct studies that might assist in the evaluation and preparation of such measures.

If section 506 of the current bill is enacted in its current form, the Administration will interpret it in an identical fashion.

The attached data table can be downloaded in PDF format by clicking this link