Statement of Administration Policy: H.R. 4301 - National Defense Authorization Act for Fiscal Year 1995

(SENT 5/17/94)
(House Rules)
(Dellums (D) CA)

The Administration supports House passage of H.R. 4301, although it has serious reservations regarding certain provisions of the bill. During further congressional action, the Administration will work with Congress to resolve these and other issues identified by the Administration as it continues its review of H.R. 4301.

H.R. 4301 provides for many of the Administration's key defense programs, including: (1) military end-strength levels; (2) research and development programs and weapons procurement, including the CVN-76 and other shipbuilding programs and the B- 2 Bomber, F/A-18 C/D and E/F, F-22, V-22, and E-8A Joint Stars aircraft programs (3) defense conversion and base closure; (4) procurement reform; and (5) environmental restoration programs.

H.R. 4301, however, contains several provisions that either are inconsistent with the President's request, premature, or would impose burdensome restrictions. The bill is most objectionable in the deep and arbitrary reductions it would impose on readiness funding through the cuts in the Defense Business Operations Fund (DBOF) and information technology. The bill would cut $1 billion in operations and maintenance (O&M) funds from the military services and would direct that cash be transferred from DBOF to the services' O&M accounts. This is precisely the same mistake that was made two years ago that led to cash shortages in the DBOF. Moreover, the Committee has called for the Department to improve its management systems, but cut $1 billion in improvements to information management technology.

In addition to these serious flaws, H.R. 4301 would:

—      Fail to approve authority to use funds for payments to the United Nations for peacekeeping activities.

—      Authorize only four C-17 airlift aircraft, rather than the six aircraft requested, and fail to authorize the proposed settlement between the United States and McDonnell Douglas.

—      Require the Department of Defense to convert, by 1997, 30,000 active duty military positions to Federal civilian employees. This would severely limit the Department's ability to meet its share of the government-wide civilian reduction.

—      Impose new and severe constraints on the Department's ability to contract for depot maintenance activities, and require the Department to maintain unneeded depot infrastructure.

—      Reduce authorizations for operation and maintenance by $0.4 billion, based on unrealistic assumptions of increased allied burdensharing. This is equivalent to an arbitrary, undistributed budget cut.

—      Reduce funding for the NATO Infrastructure program that would undermine recent U.S. efforts to increase allied burdensharing.

—      Prohibit modifications to deploy modern Trident II missiles on Trident submarines.

—      Authorize Civil Reserve Air Fleet (CRAF) contractors to use military bases. This may violate certain international air service agreements.

—      Restructure the civil defense program responsibilities before the Administration completes its comprehensive cost/benefit review of the existing civil defense program.

The Administration is also concerned with the costs of the following provisions and urges the House to make them consistent with the President's request. These provisions would:

—      Authorize a 2.6 percent pay raise for military personnel beginning January 1, 1995. The President's budget requested a 1.6 percent pay raise for civilian and military personnel. The 2.6 percent pay raise for military personnel would cost an additional $0.4 billion in FY 1995 and an additional $2.8 billion during FYs 1995-1999.

—      Institute, beginning July 1, 1995, a cost-of-living allowance for military personnel living in high cost areas in the United States. The potential annual cost of this allowance is over $100 million.

—      Authorize unrequested military construction projects for the active forces and unrequested National Guard and Reserve equipment and military construction projects.

—      Require the Department to leave all personal property at certain facilities being closed.

—      Require the Department of Defense to develop and procure new space launch vehicles even though the Administration has not completed its space launch strategy.

The Administration urges the House to support a possible floor amendment to restore the requested authorization for the Cooperative Threat Reduction, counter-proliferation programs, humanitarian assistance, disaster assistance, and military-to- military contact.

Pay-As-You-Go Scoring

H.R. 4301 would reduce direct spending; therefore, it is subject to the pay-as-you-go requirement of the Omnibus Budget Reconciliation Act of 1990. OMB's preliminary scoring estimates of this bill are presented in the table below.

Pay-As-You-Go Estimates
($ millions)