S. 1216 - DEPARTMENT OF VETERANS AFFAIRS AND
HOUSING AND URBAN DEVELOPMENT, AND INDEPENDENT
AGENCIES APPROPRIATIONS BILL, FY 2002
(Sens. Byrd (D) West Virginia; Mikulski (D) Maryland)

The Administration appreciates the Committee's support of the Housing and Urban Development's Community Technology Centers initiative and the Corporation for National and Community Service's Veterans Mission for Youth initiative. While we appreciate the Committee's efforts to fund programs at the President's requested levels, we would like to take this opportunity to share some concerns with the Committee's version of the bill.

Housing and Urban Development (HUD)

The Administration is committed to improving HUD's performance by funding those programs which are at the heart of its housing and community revitalization mission. For this reason, the FY 2002 budget proposals built specifically on HUD's core mission and proposed terminating programs that fall outside that mission. We therefore appreciate the Committee's efforts to provide most of the requested funding for housing assistance, including public housing operating subsidies, and the HOME and Community Development Block Grants.

However, the Administration has concerns with a number of funding decisions made by the Committee that deviate from HUD's core mission, including: the Committee's decision to limit opportunities for affordable homeownership by not providing funds for the Down Payment Assistance initiative in HOME; denying funding for the Improving Access initiative, which would increase the ability of individuals with disabilities to participate in civic and community organizations; and, providing only one-half of the $197 million requested for 34,000 incremental vouchers to aid additional low-income families.

Moreover, the Administration is disappointed that the Committee choose to continue to fund the Public Housing Drug Elimination and Rural Housing and Economic Development programs, which fall outside HUD's core mission. Other Federal agencies with expertise in these areas are better suited to provide such services, and consolidating these programs into areas where they are better managed creates efficiency gains that translate into the government's ability to serve more families in need.

Finally, the Administration strongly objects to a provision in the bill that transfers the HUD Housing Certificate Fund and Annual Contributions for Assisted Housing unobligated balances for FY 2002 and prior years, on a pro-rata basis, to a variety of science and housing programs. Determinations concerning the use of such balances are inappropriate when made separate from the development of the President's budget. The Administration also urges the Committee to adopt the proposal to fully fund the Housing Certificate Fund, and avoid the use of advance appropriations to circumvent spending limitations. There is no programmatic justification for an advance appropriation in this account.

The Administration looks forward to working with the Committee to identify those programs that fall within the core mission of HUD --providing community and housing services.

Federal Emergency Management Administration (FEMA)

The Administration appreciates Congress' attentiveness to the needs of FEMA, however, the Administration objects to the Senate's significant underfunding of the base program for FEMA while providing $2.0 billion in contingent emergency funding. We are also seriously concerned with the manner in which the Senate version of the bill uses the emergency designation to provide resources for FEMA above the committee's allocation.

Given the uncertain costs of responding to emergencies and natural disasters, the Administration's budget plan for FY 2002 was meant to accomplish three important objectives: (1) provide a reasonably adequate base of funding for FEMA; (2) plan for additional unforeseen emergencies and natural disasters in a comprehensive manner; and, (3) adhere to budget discipline. The Administration is disappointed that the Congress did not agree to establish a National Emergency Reserve as part of the FY 2002 budget resolution. The Administration continues to believe that the annual budget should anticipate some level of emergency response to natural disasters. Such a reserve would be useful in stemming abuses of the emergency designation provisions of the Budget Enforcement Act (BEA).

In the absence of such a reserve, the Administration will only allocate spending contained in appropriations bills, designated as an emergency, if the requirement is a necessary expenditure that is sudden, urgent, unforeseen, and not permanent. The Administration will also recommend the use of an emergency designation only to the extent that adequate base funding for a normal year has been provided for the applicable program. The classification of particular spending as an emergency requirement depends on common sense judgment, made on a case-by-case basis, about whether the needs can be absorbed within the existing level of resources available.

In sum, the Administration will only consider contingent emergency funding if that funding meets the definition of an emergency and is for a program for which adequate base funding has already been provided. The House bill has met both of these requirements. In contrast, the Senate has not funded the base disaster relief program before providing emergency funding.

While the Administration cannot support a specific level of contingent emergency appropriations at this time, the Administration would support the use of a contingent emergency designation for the reasons noted above. The Office of Management and Budget will continue to work closely with FEMA to determine the actual level of need required to meet all of the FY 2002 obligations before the bill reaches the President's desk. Based on this assessment, the Administration would submit a formal recommendation for additional funding to Congress as may be required.

Veterans Affairs (VA)

While the Administration appreciates the Committee's support of improved benefits and services to our Nation's veterans, the Committee recommended VA funding level currently exceeds the requested level. We look forward to working with the Congress to assure mutual priorities are addressed within the 302(b) allocations. The Administration is particularly pleased with the Committee's decision to support the Presidential initiative to improve the quality and timeliness of veterans' disability claims processing. The Administration is concerned, however, that the Committee did not include language to eliminate vendee loans. Elimination of support for this non-veteran program could provide up to $227 million over 10 years for other VA priorities. In addition, we urge the Congress to reconsider inclusion of the requested language that would ensure sufficient funding for the payment of veterans' entitlements by eliminating the annual need for mandatory supplemental requests.

Environmental Protection Agency (EPA)

The Administration appreciates the Committee's support for Administration initiatives to improve environmental data collection activities. However, the Administration is disappointed that the Committee has not funded either the newly-authorized sewer overflow control grant program that would address the largest remaining municipal wastewater problem, or the $25 million requested for the State enforcement grant program that would assist States in their enforcement efforts. States conduct more than 90 percent of the Nation's environmental compliance inspections and enforcement actions. The Senate is urged to restore the funding requested for these two programs. The Administration also urges deletion of legislative provisions blocking the tolerance fee rule, a user fee that would provide $37 million in outlay offsets to restore Presidential priorities.

National Aeronautics and Space Administration (NASA)

The Administration has serious concerns about the Committee's $150 million reduction to the International Space Station (ISS) because it would lead to further delays and cost increases. While we urge the Senate to fully restore the Administration's request for the ISS, we share the Committee's concern over rising costs and are supportive of the Committee's request that the Administration certify any new Space Station content or additional funding above the Space Station budget through FY 2006. However, the Administration requests that such certification responsibilities be given to the Administrator of NASA requiring concurrence from Director of the Office of Management and Budget, instead of to the President as it is highly inappropriate to require the President to make certifications regarding project-specific management and cost control decisions. We look forward to working with the Congress to address our mutual concerns.

National Science Foundation (NSF)

We appreciate the Committee's efforts to fund NSF programs at the President's request level. However, the Administration is concerned that the Committee did not fully fund the President's Math and Science Partnerships initiative and that $60 million of the total for the initiative is derived from mandatory H-1B nonimmigrant petitioner receipts. Diverting these mandatory funds would displace funding for other important K-12 math and science education programs, such as the After School Centers for Explorations and New Discovery, which provide out-of-school experiences in science and math for middle and high school students from under-represented groups.

Corporation for National and Community Service (CNCS)

The Administration urges the Senate to include funding for the President's Silver Scholarship program within the total that the Committee has provided for the Corporation.

Earmarked Funds

The Administration is very concerned about the level of earmarking in the Committee bill. The Committee has included $254 million in earmarked projects for EPA, $57 million over the level included in last year's Senate version of the bill. This level of earmarking diminishes EPA's ability to implement programs, such as the newly-authorized sewer overflow control and State enforcement grant programs, that would be more effective in addressing the Nation's most pressing environmental quality needs.

The Administration is also very concerned that there is $140 million in earmarks representing over 250 projects in HUD, which is $10 million above the level earmarked in last year's Senate version of the bill. This level of earmarked funding still diminishes HUD's ability to distribute these funds based on merit or in support of an overall economic and community development funding strategy.

In addition, the Administration has serious concerns with the Committee bill's extensive earmarks for NSF and NASA, displacing higher-priority science and space programs. The Administration is concerned that the Committee has chosen to fund six lower priority, unrequested projects within NSF for a total of $67 million. The Administration also has serious concerns with the bill's extensive earmarks for funding that would displace over $190 million in higher-priority NASA science and technology programs. For example, the bill cuts critical technology funding that would support the next decade of Mars missions, faster and more capable planetary missions, and lower-cost space transportation, while directing funding toward museums, planetariums, libraries, and college dormitories. Earmarks for NASA in the Committee bill total $252 million, $38 million over last year's Senate version of the bill. The bill also partially funds missions the Administration canceled due to cost overruns or schedule delays. NASA will be unable to begin development of these missions because the bill only funds a small fraction of their total cost. We urge the Senate to minimize the amount of unrequested projects and fully restore funding to higher-priority programs in NASA's Space Science, Earth Science, and Aerospace Technology Enterprises.

Infringement on Executive Authority

The Administration objects to a number of provisions in the bill that would require Committee approval before Executive Branch execution. The Administration will interpret these provisions to require only notification of Congress, since any other interpretation would contradict the Supreme Court ruling in INS v. Chadha.