Statement of Administration Policy: H.R. 2707 - Departments of Labor, Health and Human Services, Education, and Related Agencies Appropriations Bill, 1992

(Senate Floor)
(Sponsors: Byrd (D), West Virginia; Harkin (D), Iowa)

The purpose of this Statement of Administration Policy is to express the Administration's views on the Departments of Labor, Health and Human Services, and Education, and Related Agencies Appropriations Bill, FY 1992, as reported by the Senate Committee.

The Senate Committee bill contains a provision that would permit the use of Title X funds for counseling on abortion. The President's intention is to assure that no Federal funds are used to support abortion. The President is not in any respect seeking to impose a so-called "gag rule." He is committed to the protection of free speech.

Title X funds are intended only for family planning. Under current regulations, pregnant women who seek services from Title X funded projects are now appropriately referred for such counseling to qualified providers. The President seeks to ensure the integrity of Title X as a pre-pregnancy family planning program and to ensure that women who are pregnant are referred to providers who can ensure continuity of care. He would veto this bill if it were adopted as presently written, and will accept a bill only if it is consistent with the above principles.

The Administration supports the House bill language that restricts the use of Federal funds for abortions to those circumstances in which the life of the mother would be endangered if the fetus were carried to term. The Senate is urged to adopt this limitation, which is identical to the one included in every Departments of Labor, Health and Human Services, and Education, and Related Agencies Appropriations Bill since FY 1981. The President would veto this bill if it were presented to him with section 203 in its current form.

The Administration understands that an amendment may be offered to increase funding for programs in the bill by $3 billion with offsets from defense programs. Such an amendment would be a clear violation of the Budget Enforcement Act (BEA). The President's senior advisers would recommend that he veto the bill if it were presented to him containing this amendment.

The Administration has concerns with several other provisions of the Senate Committee bill. In its consideration of this bill, the Senate is respectfully requested to address these concerns, noted below, and to develop a bill that reflects more substantially the President's priorities.

Unemployment Insurance Administrative Costs

The Senate Committee has created a contingent appropriation to provide additional funds for administration of the unemployment insurance (UI) system. Under the Senate Committee language, an additional $30 million would be provided for every 100,000 increase in the average weekly insured unemployment (AWIU) projected by the Department of Labor over the 3.24 million AWIU level assumed in the President's FY 1992 Budget request. Such additional funds would be provided without further action by the Congress and the President. The Administration is opposed to this provision for the reasons stated below.

Aside from the contingent appropriation, the Senate Committee hill provides discretionary funding for UI administrative costs at the President's requested level of $2.3 billion. The Administration has indicated that, to the extent that changed real growth and unemployment forecasts cause unexpected UI administrative cost increases, the amount by which the revised estimates exceed the budget request would be designated as "emergency" funding and thus exempt from the BEA spending limits. As a result, no new contingency fund is necessary or appropriate.

Low Income Home Energy Assistance Program and Other Contingency Funds

The Administration objects to the Committee's inclusion of a $300 million "emergency fund" for the Low Income Home Energy Assistance Program (LIHEAP). The Committee's base funding level of $1.3 billion far exceeds the President's request of $925 million and the House funded level of $1 billion for non- contingent budget authority. The President's budget request for a $100 million contingency appropriation, however, is based on specific market criteria, including a 20-percent increase in oil prices. In contrast, the Committee's "emergency fund" has no programmatic criteria, but is specifically designed to circumvent the discipline of the domestic discretionary spending limits established by the BEA.

It is the Administration's position that annual appropriations for programs such as LIHEAP and the Health Care Financing Administration (HCFA) State Survey and Certification, the requirements for which can be — and have been for many years — reasonably estimated in advance, should not be designated as "emergency." Therefore, the Office of Management and Budget would not recommend to the President that he designate any of these funds as "emergency." If the Congress' priorities include higher spending for LIHEAP, then the Administration believes that the Congress should enact a larger regular appropriation, with offsetting reductions in other programs.

The $257 million level of contingency funding recommended by the Senate Committee for the HCFA's contractor account greatly exceeds any previous contingency fund level. The FY 1992 Budget proposes a $100 million contingency. Further, language of the Committee bill would provide for release of the contingency funds for "unanticipated costs," instead of for "unanticipated workloads." The Committee language would greatly increase the likelihood that these funds will be used.

Healthy Start Initiative

The Administration observes that the Committee has included only $75 million to support the President's Healthy Start Initiative. Healthy Start will fund comprehensive, integrated health services to 10 communities with exceptionally high rates of infant mortality. The Administration views full implementation of Healthy Start as an important step in reducing infant mortality. Given the importance of this initiative, the Administration urges the Senate to provide $139 million for full funding of the Healthy Start Initiative.

AMERICA 2000 and Other Education Issues

The Administration appreciates the Committee's inclusion of $100 million in the compensatory education account to be available for the President's AMERICA 2000 initiative, which is pending authorization. However, $690 million is required for full implementation of this initiative, of which $46.5 million requires no new authorizing legislation. The AMERICA 2000 initiative is essential to the States' efforts to reform education. It is the Administration's view that the full requested amount should be included in this hill to ensure the successful implementation of the AMERICA 2000 initiative.

The Senate Committee bill would provide $39.2 million less than the President's request for research, statistics, and improvement activities within the Department of Education. The Administration believes that this level is insufficient to maintain, much less expand, the knowledge base in support of education reform. This is a clear Federal responsibility. The Senate is urged to restore funding to the requested level.

In light of the current crisis in the management of the student loan program, the Administration objects to the 14 percent reduction below the President's budget request for administration of the Guaranteed student loan program. This provision, along with provisions that limit the Secretary of Education's ability to fine schools that charge excessive living allowances, contradicts the recommendations of Senator Nunn's Subcommittee, the General Accounting Office, and an Education/OMB task force. This would make the Department's task of restoring management credibility to the program more difficult.

The Committee bill would provide $325 million to the Department of Education for transfer to the Department of Health and Human Services for Head Start, community health centers, and child development centers. The Administration believes that funding for these programs should be provided through appropriations to the Department of Health and Human Services. The Committee's action would not result in any outlay savings, nor would the $325 million be scored as education funding. The transfer would serve only to complicate and obscure budget and accounting records for the two agencies.

The Administration again objects to continuing the $273 million in directed educational funding for health professions. These categorical grants would be more appropriately used to fund broad-based student assistance for all disadvantaged students, regardless of their profession.

Alcohol, Drug Abuse, and Mental Health Administration Treatment Funding

The Committee has not provided the $68 million requested to expand the capacity of the drug abuse treatment system. The Committee's report states that $137 million is added to the Alcohol, Drug Abuse, and Mental Health Block Grant instead of funding the as-yet unauthorized capacity expansion program. The Administration believes that the proposed capacity expansion program is a better way than the Block Grant to provide treatment funds for areas of need and to hold States accountable for the spending of these funds. The Administration urges the Senate to provide funds for this high-priority program in anticipation of enactment of authorizing legislation.

On the basis of OMB's initial scoring, the Administration finds that the Senate Committee bill exceeds the Senate 602(b) allocation for domestic discretionary outlays by $700 million.

Additional Administration concerns with the bill as reported by the Senate Committee are discussed in the attachment.

Attachment

(Senate Floor)

ADDITIONAL CONCERNS
H.R. 2707 — DEPARTMENTS OF LABOR, HEALTH AND HUMAN SERVICES, AND EDUCATION, AND RELATED AGENCIES APPROPRIATIONS BILL, FY 1992

MAJOR PROVISIONS OPPOSED BY THE ADMINISTRATION

A. Funding Levels

Department of Health and Human Services:

Adolescent Family Life Program (AFL). The Administration objects to the elimination of funding for AFL. The AFL program supports grants to test new and innovative approaches for addressing the problems of adolescent pregnancy. One objective of AFL is to promote adoption as a positive option for unmarried pregnant adolescents.

Health Resources and Services Administration (HRSA) — Health Professions Training. The Administration continues to object to the funding of numerous low- priority categorical grants, most of which provide medical and allied health school curriculum assistance. The Committee has provided approximately $273 million for categorical health professions training programs, many of which are untargeted and outdated grants.

After two decades of heavy Federal support, the aggregate shortage of health professionals has abated. The Administration believes that this money would be far better spent in broad-based student aid programs for low income and disadvantaged students — such as Pell Grants — than for these special interest grants.

Interim Assistance to States for Legalization (SLIAG). The Senate Committee would use $1.1 billion of budget authority and $242 million of outlays from the FY 1993 discretionary spending limits by moving FY 1992 SLIAG budget authority and outlays a few months into FY 1993. The Administration has proposed permanently rescinding these funds to free up resources for higher priority spending in FY 1992 and subsequent years.

The Committee, in electing not to make real reductions in resources for this activity, has merely moved budget authority and outlay burdens into the future.

Office of the Inspector General (OIG). The Administration objects to the Committee's $9.5 million reduction from the request for the OIG. The Committee's funding level would jeopardize the Inspector General's ability to carry out critical functions, including added responsibilities required to support full implementation of the Chief Financial Officers Act of 1990.

Department of Education:

Special Education — Infants and Families Grants. The Senate Committee provides $46.2 million more than the President's request for Infants and Families grants. Recently enacted provisions in P.L. 102-52 provide States with sufficient relief from program requirements that additional Federal funds are not needed to keep them from dropping out of the program. Any increases above the President's request likely would be used by States to supplant other Federal, State, local, and private sources of funding for services, with no net gain for the handicapped. The Senate is urged to fund Infants and Families grants in accord with the President's request.

Special Education — Chapter 1 Handicapped Grants. The Senate Committee report supports the Administration's plan to begin the merger of Chapter 1 Handicapped with the larger Basic Grants program of the Individuals with Disabilities Education Act. The Administration proposal would shift funding from Chapter 1 to Basic Grants to begin a phased merger with child shares equalized between the two programs. The Committee has increased Basic Grants without adjusting Chapter 1 funding. This action would perpetuate the inequity in child shares between the two programs. The Senate is urged to reduce funding for Chapter l Handicapped grants to conform to the mutually desired policy of a phased merger into Basie Grants.

Rehabilitation Services. The Senate Committee bill would fund this account, which is classified as mandatory under the Budget Enforcement Act (BEA), at $2.l billion, $68 million over the baseline, in accordance with BEA scorekeeping rules, the $68 million will be scored against the discretionary budget authority cap. The Congress and the Administration will be considering the reauthorization of programs under the Rehabilitation Act over the next year. The Administration believes that an increase of this magnitude is premature and without programmatic basis.

In addition, the bill would earmark $6 million of the $25 million provided for special demonstration programs for a non-competitive grant to a single hearing research center. This would inappropriately restrict the Secretary's flexibility in making awards under this discretionary grant program.

School Improvement Program. The Administration objects to the Senate Committee's failure to adopt the President's proposal to consolidate the Education for Homeless Children and Youth program into a single demonstration authority to be administered by the Department of Housing and Urban Development. Experience has proven that there is no benefit to the homeless in having multiple agency demonstration projects with overlapping purposes. Although the Senate Committee would provide $25 million less than the House bill, funding would still be $17.7 million over the FY 1991 enacted level for this program.

The Dropout Prevention Demonstration program is not a continuing grant program. It is a set of carefully controlled demonstrations that are being rigorously evaluated to provide information to improve the many dropout prevention programs already being carried out with and without Federal funding. The additional funding provided by the committee over the President's request is not needed to complete the current round of demonstrations, and funding another set of Federal projects would be wasteful spending.

Guaranteed Student Loan Salaries and Expenses. In addition to the one-percent across-the-board reduction, the bill would reduce Salaries and expenses ln the Guaranteed student loan programs by approximately 14 percent below the President's request. The administrative resources requested by the President for Guaranteed student loans are critical to correcting the serious management problems that have been identified in recent reports by the General Accounting Office, Senator Nunn's Subcommittee, and the joint Department of Education/OMB review team.

Chief Financial Officers Act of 1990 (CFOs Act). The Administration supports full implementation of the CFOs Act of 1990. The Committee's reductions to Program Administration and the Office of the Inspector General would threaten the Department's ability to carry out a significant aspect of the Act: the preparation and audit of financial statements. The Administration urges the Senate to provide funding levels consistent with the President's request to ensure the implementation of the CFOs Act.

Higher Education. The bill would provide $10 million for Urban Community Service Funds, an activity authorized in 1986, but never funded. Funding this program is inappropriate because its activities duplicate those under many other currently operating higher education programs.

Department of Labor:

Bureau of Labor Statistics. The Administration objects to the Committee's $37 million reduction to the request for the Bureau of Labor Statistics (BLS). The reduction would eliminate funding to conduct pay surveys mandated by the Federal Employees Pay Comparability Act of 1990 (FEPCA), and BLS' part of a government-wide long-term plan to improve Federal employment, price, and other economic statistics. Without the pay surveys, locality-based comparability payments for approximately 1.5 million General Schedule employees could not be determined as required by FEPCA. In addition, the Committee's reduction would eliminate the last year of funding necessary to complete BLS' planned national office consolidation.

All three of the initiatives that would be eliminated by the Committee's reduction are multi-year projects, the first stages of which have previously been approved by Congress. BLS has already hired staff and committed resources to these projects, based on the expectation that funding for these multi-year projects would continue to be provided.

Training and Employment Services — Title III of the Jobtraining Partnership Act. The senate has added $50 million for the Clean Air transition assistance program to the President's request of $527 million for the Economic Dislocation and Worker Adjustment Assistance (EDWAA) program. The Budget request includes $50 million for Clean Air transition assistance within the $527 million total requested.

Nearly 295,000 dislocated workers would be served under the Administration's EDWAA request, representing about 55 percent of the annual average number of prime-age, experienced dislocated workers reported in surveys conducted by the Bureau of Labor Statistics. This participation rata compares favorably with participation rates reported in evaluations of several Labor Department worker readjustment demonstration projects. Moreover, the Administration request takes into account the $150 million provided in FY 1991 for three years to finance worker adjustment assistance programs authorized by the Defense Conversion Adjustment program.

Training and Employment Services — Job Corps. The Senate Committee has added $60 million in new budget authority to the Administration's $867 million request for the Job Corps in FY 1992. The Senate Committee has denied the budget request for a $20 million reappropriation of FY 1989 capital funds earmarked for program expansion. Instead, the Committee bill would extend the availability of the resources earmarked for expansion and provide another $10 million for operations, and $30 million for center relocations and new center acquisition costs. In report language, the Committee directs the Administration to "expeditiously proceed" with the expansion program.

The Administration firmly believes that the Committee's priorities for the Job Corps program are misdirected. Expansion should have halted with the two new centers opening in program year 1991. Diverting limited resources to finance program expansion instead of program improvements could hurt program outcomes at existing centers. Expanding the program by four additional centers would boost operations costs by about $20 million annually.

Training and Employment Services — National Programs. The Senate Committee has added $65 million to the Administration's FY 1992 request for Job Training Partnership Act national programs and programs for special groups within the economically disadvantaged population. The FY 1992 request for these programs is sufficient to meet current program needs, and the 37-percent increase provided by the Senate is not necessary.

Included in the increase is $11.2 million for the McKinney Act Job Training for the Homeless demonstration program. In an effort to stimulate more comprehensive, innovative services to the homeless, the Administration has requested funds for this program in the Supplemental Assistance for Facilities to Assist the Homeless account in the Department of Housing and Urban Development. The Administration urges the Senate to finance job training for the homeless through that account only.

Community Service Employment for Older Americans. The Senate Committee has added $57 million to the Administration's $343 million request for the Community Service Employment for Older Americans (CSEOA) program. The Administration's FY 1992 request for CSEOA reflects the severe budget constraints facing domestic discretionary programs, thus limiting the availability of funds for this program.

State Unemployment Insurance and Employment Services Operation (SUIESO) — Employment Service. The Senate Committee has provided $88.1 million in additional funds for allotments to States to operate local Employment Service offices and an additional $12.5 million for automation of State activities, the latter amount made unavailable for obligation until September 30, 1992. This amounts to $95.6 million above the President's request. In the Administration's view, there are higher priority uses of these funds, and the Senate is urged to finance the Employment Service at the requested level.

Office of the Inspector General (OIG). The Administration objects to the Committee's $1.3 million reduction from the request level for the OIG. A level consistent with the President's request is required to carry out a strong Inspector General function and to support full implementation of the Chief Financial Officers Act of 1990.

United States Institute for Peace (USIP):

Funding Level. The Committee bill would provide $3 million, or 34 percent, more than the President's Budget for the U.S. Institute for Peace. Although USIP is a well run organization, an increase of this magnitude is unnecessary and inappropriate in a time of fiscal constraint.

B. Language Provisions

Department of Health and Human Services:

Health Education Assistance Loans Program (HEAL). The Administration observes that the Committee did not include the House bill language to limit FY 1992 obligational authority for the default-plagued HEAL program. The Administration urges the Senate to limit FY 1992 HEAL loan commitments to $185 million.

Given the Government's total liability from the nearly $2.6 billion in HEAL loans already outstanding and high levels of default rates among some categories of schools, the program warrants complete restructuring. The Administration is working with the authorizing Committees to improve the targeting and effectiveness of the HEAL Program.

Department of Labor:

Training and Employment Services. The Senate Committee has included bill language setting a ceiling on the amount of funds each State may receive under the FY 1992 allotment formula for the Job Training Partnership Act's (JTPA) title 11-A grant program. The Administration does not support any restrictions on the distribution of funds established in the JTPA statutory formula.

Job Corps. The Senate bill includes language in sections 103 and 104 of the General Provisions that would prohibit the use of funds to contract out operations of Job Corps Civilian Conservation Centers with a non-governmental entity (section 103) and that would restrict the use of Job Corps funds for paying legal expenses in criminal cases (section 104). These provisions would limit the Administration's flexibility to manage the Job Corps program efficiently, and the Senate is urged to delete them.

Occupational Safety and Health Administration (OSHA). The Administration objects to the inclusion of restrictive provisions in OSHA's appropriations language concerning reporting requirements related to small farms; recreational hunting, shooting, or fishing; and small firms. These restrictions would limit the agency's flexibility to focus inspection resources on workplaces with the poorest safety records.

Mine Safety and Health Administration (MSHA). The Administration objects to the inclusion of appropriations language that would exclude sand, surface limestone, and similar mine operations from coverage under section 115 of the Mine Act. The hazards faced by these mining operations are no less serious than the hazards faced in other mining operations. Statistics show that these mines are no safer than other metal and non-metal mines.

Department of Education:

Program Administration. The Committee bill earmarks $500 thousand for nine new FTE for monitoring grants under Part B of the Individual with Disabilities Education Act. The Administration believes that it is highly inappropriate for Congress to mandate so specifically how administrative resources for the Department of Education are to be used, particularly when the resource levels provided by the bill are inadequate to address the broad array of agency management needs.

Student Financial Assistance. The Committee bill would restrict the authority of the Secretary of Education to levy a fine on schools that are abusing students by charging too much for living allowances. Programs that use telecommunications devices as the sole method of instruction are considered correspondence courses; such programs are allotted lower living allowances. This provision would restrict the Secretary's authority to fine these schools to recoup the Federal funds expended on higher-than-authorized or inappropriate living allowances. The Senate is urged to delete this provision.

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