Statement of Administration Policy: H.J. Res. 423 - A Resolution Making Further Continuing Appropriations for FY 1990

(House)

The second continuing resolution provides $2.85 billion in supplemental funding for disaster relief and extends the first continuing resolution through November 15, 1989. Based on current estimates of earthquake recovery costs, it would appear that the dollar amounts made available in this resolution may exceed actual program needs. In the interest of providing assistance to the State of California quickly, however, the Administration supports House passage of the continuing resolution — but will seek refinements in the Senate.

The disaster assistance provided in the resolution is not limited to helping California recover from the earthquake. The Administration believes that disaster assistance provided in this short-term continuing resolution should be limited to assistance related to the earthquake.

The resolution provides an additional $500 million for SBA disaster loans despite the availability of nearly $1.5 billion in existing resources. The Committee resolution fails to lift the existing $237 million limitation on new SBA loans. The Administration proposes to increase the limitation from $237 million to $1.31 billion, making the additional $500 million unnecessary. In addition, given the current estimate of damage to the Federal Aid Highway System, the $100 million in emergency highway assistance already provided, and the likely availability of State matching funds, the $1 billion included in the Committee-reported resolution for highway repairs exceeds the estimated supplemental requirement by an estimated $500 million.

The Administration strongly supports the amendment which is made in order in the rule, to strike Section 108 (f), the provision exempting the disaster-related funds from the Budget Act ceilings and Gramm-Rudman-Hollings. Subject to passage of this amendment, the Administration supports passage of the Committee-reported resolution.