Statement of Administration Policy: H.J. Res. 738 - Continuing Resolution for FY 1987

(House)
(Sponsor: Whitten (D), Mississippi)

The President's senior advisors would recommend approval provided:

1. The Defense (050) and the International Affairs (150) accounts are consistent with their allowances under the Congressional Budget Resolution (CBR), and restrictive language inhibiting the Executive Branch's ability to conduct essential national security programs is eliminated.
2. The numerous provisions giving rise to veto threats on nine of the 13 individual appropriations measures are negotiated successfully (and we stand ready to engage in such negotiations at the convenience of the leadership).
3. There is enacted a Reconciliation bill with sufficient savings that, together with the Continuing Resolution, would bring the FY 1987 deficit within the $154 billion "margin of error" that would trigger a sequester under Gramm-Rudman-Hollings.

Otherwise, the President's senior advisors would recommend that he veto the bill.

The Nation's security depends upon proper support for our defense and international .activities. This is why the President has been so emphatic about adequate appropriations for them. This is also the reason the President has threatened veto unless restrictive language — such as that on the anti-satellite weapon system (ASAT), binary chemical weapons, nuclear testing, and strategic forces deployment — is removed from the bill.

Within the context of the criteria mentioned above, the Administration would not oppose domestic appropriations consistent with the Senate 302(b) allocations of the Congressional Budget Resolution (CBR) for discretionary budget authority and outlays. Moreover, the Administration recognizes the need for modest flexibility in order to reconcile differences between the House and Senate 302(b) allocations and differences among the contents of individual appropriations measures upon which the Continuing Resolution is based. However, in the aggregate, discretionary domestic budget authority and outlays must not exceed the Senate 302(b) levels. In no circumstances should allocations for defense and international affairs be used to finance increases 1n domestic spending.

In addition, it is vital that numerous policy differences which the Administration has identified in previous correspondence be resolved so that veto threats may be removed. (Negotiations over these items should be commenced in earnest at the leadership's earliest convenience.) In particular, the Administration opposes any across-the-board reductions.

The Administration's position is that all aspects of the Continuing Resolution be consistent with the above criteria and should reflect previous communications on individual appropriations measures.

H.J. RES. 738, CONTINUING RESOLUTION, 1987
OBJECTIONABLE PROVISIONS - HOUSE VERSION

Agriculture

Farm Price Supports: The Administration has long supported better targeting of farm price supports, and we, therefore, welcome Congressional efforts to tighten current payments limitations. However, amendments #1 and #2, on payment and loan limitation, are unacceptable as written. They remove the payment limitation of $50,000 per person for deficiency and diversion payments for the 1987 through 1990 crops, thus potentially increasing Federal outlays $800 million to $1 bi1ion per year.

Food and Drug Administration User Fees: In rejecting the President's proposal for FDA user fees, the House has added restrictive language prohibiting the use of funds to develop, establish, or implement user fees. This language represents an intrusion into effective management of FDA drug approvals and would seriously hamper FDA's effort to improve the processing of new drug applications.

Commodity Supplemental Food Program: The Administration opposes language that forbids CSFP from reimbursing CCC for commodities donated to the program. The reimbursement of CCC for commodities is a valid program expense, and failure to pay for donated CCC items understates the resources needed to maintain CSFP food packages. This restriction results in subsidies to CSFP by CCC.

REA: Language specifying that REA use 4-year old criteria to determine the ratio of private to public financing and prohibiting REA from requiring that borrowers use their own funds first before borrowing.

Restrictions on President's Authority to set Credit Policy with Poland: "Restriction would not allow the U.S. to pay off on loan guarantees to banks holding loans to Poland unless the President declares Poland in default. This is bad foreign policy and undermines the CCC Export Credit Program.

Minimum Staffing Levels. Section 626 mandates minimum staffing levels for three bureaus of USDA -- Farmers Home Administration, Agricultural Stabilization and Conservation Service, and Soil Conservation Service. This Infringes on the Executive branch's ability to Implement programs efficiently and effectively.

Commerce, Justice, State, and Judiciary

Civil Ri ghts Commission: The Administration strongly supports continuatlon of the Commission on Civil Rights at the level of its 1987 budget request, without restriction. The action of the House to fund only termination costs of the Commission in 1987 disregards the important functions performed by the Commission as a national resource for the furtherance of civil rights.

Defense

Space Defense System: The Administration objects to the House's addition of language prohibiting testing of the Space Defense System (anti-satellite weapon, or ASAT) against objects in space until the President certifies the Soviets have conducted such a test. This prevents the U.S. from develdping an ASAT system. The Soviet Union already has an operational system.

Binary Chemical Munitions: The House included language that prohibits obligation of FY 1986 or FY 1987 appropriations for procurement of binary chemical weapons until October 1, 1987. The provision also prevents withdrawal of existing U.S. chemical munitions from Europe unless replaced by binary munitions. These restrictions place the Administration in the untenable position of not being able to replace our obsolete unitary chemical weapons in Europe because we cannot produce the newer and safer binary chemical weapons for replacement.

Nuclear Testing Restrictions: The House added language that would prohibit U.S. nuclear test explosions of greater than one kiloton of explosive yield. This would compromise the credibility of our nuclear deterrent and would halt the introduction of modern safety and security devices into the majority of our stockpiled Weapons.

Strategic Forces Deployment Constraints: The Administration objects to the provision prohibiting deployment of any nuclear weapons which would violate the sublimits of the unratified SALT II Treaty unless the President certifies that the Soviets have deployed forces in excess of the SALT II sublimits. The Administration also opposes the provision preventing overhaul of SSBM 642 or SSBN 624. These provisions would undermine the U.S. position regarding strategic arms control agreements and lessen Soviet incentives to engage in serious negotiations towards a new agreement requiring deep reductions.

Military Pay Raise: The Administration opposes the reduction of the military pay raise from 4% (in October) to 3% (in January) and the increase in civilian raise to 3%.

Military Whistle Blowers: Provision would allow military personnel to appeal directly to the courts for de novo review of even routine personnel matters they allege are reprisals. This would mean an unprecedented involvement of courts in military actions and would undermine the authority of military commanders.

District of Columbia

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Energy and Water

Savings and Slippage: Provision directing that savings and slippage be applied in same proportion to all water projects.

Prohibitibn on PMA Studies of Repricing Hydroelectric Power.

Requirement to Complete Red River Lock #3: Completing the lock will cost $250 million. Other more efficient, less environmentally harmful modes of transportation exist.

Uranium Enrichment: Report language prohibiting any study of the sale of uranium enrichment facilities and restricting debt repayment.

Foreign Operations

Development Assistance Restrictions: Requires that the percentage of Development Assistance funds expended for programs outside the sub-Saharan Africa region be the same in fiscal 1987 as it was in fiscal 1986. The provision has the effect of earmarking development funds for an entire region.

Outlay Cap: Limits 1987 expenditures of current and prior year appropriations for foreign operations.

Chadha: Requires written approval of committees in order to obligate funds to an account other than to which appropriated. (Unconstitutional)

Chadha: Requires committee approval of transfer to International Narcotics Control account (Unconstitutional)

HDD - Independent Agencies

VA, General Operating Expenses: Appropriation language prohibits VA from implementing their management proposal to consolidate the operation of insurance programs which would save $7.75 million over six years. This prohibition interferes with VA's ability to manage the agency in a cost-effective manner.

NASA Restrictions: Prohibition on NASA from using funds to reassfgn and/or transfer programs and personnel from the Johnson Space Center without congressional authorization.

Housing Programs: Language would modify rent control prohibition in rental rehabilitation program to allow States to restrict rents in assisted units.

Disaster Relief: Language imposes one year prohibition on implementing proposed new rules on disaster relief. Rules would shift from a 75/25 cost sharing with State/local governments to a new "sliding scale" cost sharing based on the severity of the disaster.

Interior

President's Policy Deferral Authority: Repeals the President's policy deferral authority under section 1013 of the Budget Act for authority in this Act.

Indian Health Service Restrictions (IHS): Provision requires Congressional approval for certain resource reallocations. This effort to micromanage IHS's resources will delay efforts to tie resource allocations to Indian health care needs.

Moratorium on OCS Leasing.

"Buy American" Provision: Would require that structures on OCS contain at least 50 percent U.S. materials.

Prohibition on sale of NPR.

Strategic Petroleum Reserve: Establishes minimum fill rate of 75,000 barrels per day.

Bureau of Reclamation Restrictions: The Administration objects to provisions specifying that no costs associated with Federal construction of distribution system and drains of the California Central Valley Project will be paid by power contractors of the project. This provision could make nonreimbursable certain construction costs required under current law to be repaid to the Federal Government by project beneficiaries.

New Legislative Vetoes (Chadha): Bureau of Indian Affairs, Operation of Indian programs -- The bill prohibits the use of appropriated funds to move the "northern California agency office from Hoopa, California, unless a reprogramming request has been submitted to and approved by the House and Senate Appropriations Committees."

LABOR-HHS-EDUCATION

"Double-breasting": Oppose Inclusion of House-passed HR 281. This bill would amend the National Labor Relations Act and fundamentally weaken a central tenet of labor law which protects an individual's right to choose whether one wishes to join a particular union or any union. By preventing a contractor from operating both a union and a nonunion operation, HR 281 would impose the union representing the employees of one company on the employees of the nonunion company who will not have the opportunity to decide whether they wish to be represented. HR 281 also broadens the effect of pre-hire agreements setting the terms of employment on construction sites. Under the bill, a union which has a pre-hire agreement with an employer could become the exclusive bargaining agent of the employees on that site, notwithstanding that a majority of workers may not want to be represented by that union or any union. This means a minority of workers would control the job conditions of a majority of workers.

National Institutes of Health: The House continues to mandate a minimum dumber of "new" and "competing" NIH research grants in the appropriations language. We believe that a more productive measure, one that permits NIH the flexibility essential to continued excellence in biomedical research, would be a minimum number of total research project grants.

Expansion of wage survey. The Committee Reports Indicate that the appropriation for the Bureau of Labor Statistics (BLS) does not include amounts to expand the Professional, Administrative, Technical, and Clerical compensation survey needed for more accurate comparisons of Federal with non-Federal pay systems, as contemplated by the Federal pay-setting law. Congress should make clear that the BLS appropriation is available for this important expansion.

Acquired Immune Deficiency Syndrome. The House seems to endorse the Administration's efforts to improve the allocation of AIDS research funds, by giving the Director of NIH the flexibility to allocate NIH AIDS funds on the basis of scientific opportunity and public health need. We encourage the Congress to extend this meritorious concept to the entire Public Health Service's efforts to address the wide range of public health issues surrounding AIDS.

Job Corps. Prohibits the closing of Job Corps Centers before July 1, 1988.

Unemployment Insurance: The bill has new appropriation language for state UI and ES Operations apparently aimed at permitting States to carry over UI administrative money from one fiscal year to the next. Such a change would be contrary to the financial management improvements just instituted by the Department of Labor. If these Federal tax dollars are not needed to administer unemployment insurance programs in one fiscal year, there is absolutely no reason to permit them to be spent on non-essential activities in the next fiscal year when the subsequent appropriation will cover all necessary costs.

Legislative Branch -- No objections.

Military Construction

Restoration of Funds: The 6th Army Division in Alaska, strategic homeport facilities at Everett, Alaska and Staten Island, New York, Air Force One maintenance facilities at Andrews AFB, classified project, and petroleum resupply facilities in Morocco should be funded.

Transportation

Authority to Reinstate Former Air Traffic Controllers: Bars the Secretary of Transportation from denying reemployment to fired air traffic controllers "as a class" soley because of participation in an illegal strike. This provision would inappropriately mandate executive branch hiring and would jeopardize the safety of the air traffic control system.

Presidential Appointee Restriction: Limits the number of "political and Presidential appointees" in the Department of Transportation. This provision would severely limit management's flexibility.

Treasury - Postal Service - General Government

Prohibits funds to be available for OIRA.

Customs (S&E): Establishes personnel floor of 14,891 FTE. Requires Customs Service to report monthly to Congress on vacant positions with funding availability.

Circular A-21: The imposition of a seven month delay in permitting implementation of the OMB Circular A-21, as modified in consultation with the university community, undermines the combined efforts of the Congress, the universities, and the Executive Branch to address the problem of rapidly growing overhead payments. As indicated in the June 9th revision of the Circular, the Executive Branch remains willing to adjust the administrative overhead allowance figure when universities present data that permit further analysis of the effects.

Title IV, General Services Administration, Federal Buildings Fund: The Administration opposes the addition of 5 construction projects and strongly opposes the construction of a Federal building in Wilkes-Barre, Pennsylvania, and the purchase of a site for a Federal building in Chicago, Illinois.

Fort DeRussy: The Administration opposes the prohibition on sale, lease, rental, excessing, surplusing or disposal of any portion of properties located at Fort DeRussy, Honnolulu, Hawaii.

Contracting Out: The Administration opposed the prohibition on contracting for work performed by employees in selected positions in the General Services Administration.

Customs Service: Prohibits funds to be used on consolidation of field offices.

IRS: Establishes personnel levels for Taxpayers Service.

OMB: Prohibits reviews of agricultural marketing orders, including certain statistical data.

Chadha (Section 611): Prohibits funds for regulations that have been disapproved by resolution of disapproval.

Prohibition of Payment to Nominees (Section 601): Prohibits payment of funds to person nominated but not approved by Senate.

CFC (Section 618): Eliminates eligibity requirements for Combined Federal Campaign; denies funds to change CFC regulation.

Civilian Pay Rates: The Administration opposes the reduction of the military pay raise from 4% (in October) to 3% (in January) and the increase in civilian raise to 3%.