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

(Senate)

The House-passed 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 Senate passage of the continuing resolution — but opposes amendments to provide additional disaster assistance.

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 House-passed resolution fails to adequately increase 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.

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 resolution for highway repairs exceeds the estimated supplemental requirement by $500 million. The Administration opposes amendments which would alter the existing authorization law for eligibility for Federal highway aid, Federal matching requirements, and the calculation of the minimum allocation penalty.

The Administration strongly supports the House action to strike Section 108 (f), the provision exempting the disaster-related funds from the Budget Act ceilings and Gramm-Rudman-Hollings and would oppose any effort to restore the exemption in the Senate.