Statement of Administration Policy: H.R. 2577 - Supplemental Appropriations Act, 1985

(Senate)
(Hatfield (R), Oregon)

The supplemental appropriations bill as approved by the Senate Appropriations Committee requires substantial improvement. The major objectionable features are:

— Funding to initiate construction on 15 unrequested new water projects, nine of which are unauthorized, that will cost $2.7 billion. While the Senate Appropriations Committee has included language in the bill that takes a step toward cost-sharing reform, it does not go far enough. The cost-sharing reforms that are included do not apply to future projects and navigation user fees are not provided for at all. The Administration cannot agree to construct these projects without permanent reform and navigation user fees.

— Language provisions that unnecessarily constrain the discretion of certain executive agencies to carry out their functions.

— A provision that mandates that not less than $750 million of the supplemental economic assistance requested for Israel be disbursed within 30 days of enactment. It is in the strong interest of both countries that the release of these extraordinary supplemental funds be based on economic circumstances rather than on an arbitrarily set time schedule. The Government of Israel has not yet announced the next phase of its economic recovery program. The requirement for automatic and immediate disbursement will strip the supplemental assistance of its value as a vote of confidence in Israel's economic policies and will deny the President the ability to disburse the assistance in a manner that will be complementary to Israel's economic recovery program, as opposed to being a substitute for it.

The bill does not include the President's request for economic support for Jordan. These funds are important to enhance the prospects for peace in the Middle East.

The Administration urges the Senate not to include funding for any unrequested water projects unless accompanied by further progress on fundamental water policy reform measures, to pass a bill that is free of unrequested discretionary spending increases to reject the unnecessary restrictive language, and to include the requested funds for Jordan.

June 18, 1985

SUPPLEMENTAL APPROPRIATIONS ACT, 1985

Administration Position

• The supplemental appropriations bill in its present form requires substantial improvement. It is a serious disappointment as an initial statement of fiscal responsibility by the Senate for this session of Congress.

Senate Totals (See attached table)

New Water Projects

• The Senate proposes to add in this 1985 supplemental appropriations bill 15 unrequested new water projects, with a total cost of $2.7 billion. These additions are made:

— without the enactment of permanent cost sharing reforms.

— without enactment of new fees for users of our port channels and inland waterways to pay their construction or operating costs, and

— outside the limitations of the 1986 budget resolution totals, through use of the device of 1985 supplemental appropriations.

Objectionable Language Provisions (see attachment)

• In addition to the funding problems, the bill contains a number of objectionable language provisions that unnecessarily constrain the discretion of various executive branch agencies to carry out their functions.

Middle East Economic Support Fund

• The bill mandates that $750 million of the economic assistance for Israel be disbursed within 30 days of enactment.

• This requirement will deny the President the ability to disburse the assistance in a manner that will be complementary to Israel's economic recovery program, as opposed to being a substitute for it.

• The provision will strip the decision to disburse the

supplemental assistance of its value as a vote of confidence in Israel's economic policies.

• The bill does not include the President's request for economic support for Jordan. These funds are important to enhance the prospects for peace in the Middle East.

Legislative Status

• The House Appropriations Committee reported this bill on Wednesday, May 22.

• The House completed floor action Wednesday, June 12.

• The Senate Appropriations Committee reported this bill on Friday, June 14.

• Senate floor action is scheduled for Wednesday, June 19.

June 18, 1985

OBJECTIONABLE LANGUAGE PROVISIONS

A number of objectional language provisions are included in H.R. 2577, the Supplemental Appropriations Act of 1985 as approved by the Senate Appropriations Committee. These provisions would:

— mandate that not less than $750 million of the supplemental economic assistance requested for Israel be disbursed within 30 days of enactment. It is in the strong interest of both countries that the release of these extraordinary supplemental funds be based on economic circumstances rather than on an arbitrarily set time schedule. The Government of Israel has not yet announced the next phase of its economic recovery program. The requirement for automatic and immediate disbursement will strip the supplemental assistance of its value as a vote of confidence in Israel's economic policies and will deny the President the ability to disburse the assistance in a manner that will be complementary to Israel's economic recovery program, as opposed to being a substitute for it.

— require that the economic assistance for Israel and Egypt be in the form of cash grants. Again, the President should be given the flexibility to set terms, based on consultations with the recipient governments, that reflect the economic situation.

— require that the equivalent of $65 million in Egyptian currency be deposited in a trust fund for an endowment of the American University in Cairo. Enactment of this unrequested provision could lead to pressures to appropriate dollars for this purpose at a later date.

— require the Farmers Home Administration to charge the lower of the interest rates in effect at the time of loan closing or loan approval on water and waste disposal loans. Because of the unique structure of water and waste loans, the time lag between loan approval and closing can be as much as one year. Because interest rates can vary substantially over such a time period, this provision would result in additional administrative costs attributable to the reworking of loan dockets, financial analyses, and other papers.

— prohibit the use of funds to make changes in the location of Agricultural Stabilization and Conservation Service State and county offices. This provision halts improvements in program operations and reduces the ability of the Department of Agriculture to serve farmers better at a time when such service is essential.

— extend the National Commodity Processing pilot program (NCP) for an additional school year. The pilot program was cost-ineffective and operationally unsound. It merely replaced processing done by States. In fact, it actually encouraged States to disband their own programs because of the duplication of services.

— permit the use of fiscal year 1985 funds to implement the Administration's jurisdictional interchange proposal between the Bureau of Land Management and the Forest Service subject to the approval of the House and Senate Appropriations Committees. This language is redundant since any necessary authorizations must come from the authorizing legislation. Further, it is a legislative veto contrary to the Supreme Court decision in Chadha v. INS.

— expand relocation benefits for new Senior Executive Service and Presidential appointees. Current allowances, including moving and travel expenses, afford the new SES and certain other employees an adequate level of reimbursement for costs incurred in accepting a Federal appointment.

— provide for real estate allowances to be paid to U.S. employees for change-of-station moves involving overseas assignments. Real estate reimbursement compensates for expenses necessarily incurred as a direct result of a permanent change of duty station. Employees going overseas clearly are not going permanently, and the disposition of real property therefore does not follow directly from the move overseas.

— eliminate Executive Office of the President discretion to apportion funds for Health Resources and Services Administration programs, contrary to the intent of the Impoundment Control Act of 1974 and the Anti-deficiency Act. Proposed language infringes on the Administration's ability to carry out responsible forward planning.

— require the General Services Administration to compensate the Federal Communications Commission for the relocation of the Fort Lauderdale Monitoring Station, within the state of Florida, contrary to the Federal Property and Administrative Services Act of 1949 and established Administration and GSA Policy.

— provide for transfer of $6.2 million for shipbuilding and conversion, Navy 1981/1985 to the Coast Guard for the overhaul of the icebreaker Westwind. The Coast Guard can meet its icebreaking requirements with its current fleet.