Statement of Administration Policy: H.R. 4867 - Department of the Interior and Related Agencies Appropriations Bill, FY 1989

(Senate)
(Sponsors: Whitten (D), Mississippi; Yates (D), Illinois; Stennis (D), Mississippi; Byrd (D), West Virginia)

Based on a number of objectionable funding and language provisions included in the present version of the bill, the Director of the Office of Management and Budget would recommend that the President veto the bill.

Section 322 purports to require OMB and the agencies to comply with non-statutory statements issued by the managers of conference committees. This provision restricts the President's ability to execute the actual statutory language of appropriations legislation as concurred in by each House of Congress, presented to the President, and enacted into law. The "instructions and the specific allocations and earmarking of funds contained in the joint statement of managers" are neither voted on by Congress, nor presented to the President. These concerns clearly raise fundamental constitutional issues under the "take care" and "presentment" clauses. The Director of the Office of Management and Budget would welcome the opportunity to work out an arrangement in this regard that is mutually acceptable and recognizes the appropriate roles of both Branches; but the present language is constitutionally infirm and therefore unacceptable.

We thus believe that, to the extent it purports to make nonstatutory "instructions" binding on the Executive Branch, Section 322 attempts to bypass the "express procedures of the Constitution's prescription for legislative action: passage by a majority of both Houses and presentment to the President." (INS v. Chadha, 462 U.S. 919, 958 (1983).) This departs from the intended constitutional design. The non-statutory "instructions" may or may not be carefully considered by a majority of the members of both Houses, and may or may not even be consistent with the law as actually signed. If Congress wishes to provide for the enactment of the managers' "instructions," it may quite properly do so consistent with the Constitution by incorporating them in legislation voted by each House and presented to the President.

The Administration is pleased that the Senate Committee bill continues efforts begun in FY 1988 to demonstrate the Nation's ongoing commitment to implement the recommendations of the joint U.S. - Canadian Special Envoys on Acid Rain. The bill provides the requested funding for future rounds of project solicitations for the Clean coal technology program beginning in FY 1990. The bill does not provide the advance appropriations of $600 million requested for FY 1991 and FY 1992, and the Administration urges that these funds be added to the bill.

The Administration urges that the bill be amended to delete $159 million for energy conservation grants that should be financed by States from receipts resulting from petroleum overcharge violation cases $174 million for land acquisition that should be postponed, if it cannot be foregone $143 million for discretionary, non-critical construction; and $50 million for Indian health facilities despite a 50 percent occupancy rate at these facilities. The enclosure explains why these and other low priority and unnecessary programs should not be funded.

The bill includes language that should be deleted that excludes areas of the North Atlantic, California, and Florida from the offshore leasing program. These moratoria contradict the statutory mandate of the OCS Lands Act designed to expedite exploration and production consistent with proper balancing of environmental and other concerns. They override the process of scientific studies and balancing analysis required by sections 18 and 19 of the OCS Lands Act. The Interior Department current estimate is that the moratoria would reduce anticipated FY 1989 receipts by $155 million — $125 million from California leases and another $30 million from Florida and the North Atlantic leases.

In addition, the proposed moratoria language may increase the potential liability of the U.S. by preventing the Secretary from approving plans or activities on existing leases off the Florida coast south of 26 degrees North latitude. This potential liability may not be limited to the millions of dollars in expenditures incurred to date by the companies holding these leases.

Language that accelerates OCS sale No. 95 in Southern California is also objectionable because it undermines the purposes of the OCS Lands Act (like moratoria) and uses questionable procedures (such as avoiding full environmental studies) that appear to be contrary to the Act. Further, moving receipts from FY 1990 to FY 1989 only exacerbates the FY 1990 deficit. It does nothing to address Congressional concerns and to ensure that areas under moratoria are eventually offered for leasing consistent with OCS legal and environmental requirements.

The Administration has serious concerns about the policy implications of language that prohibits the Bureau of Mines from proceeding with the sale of Federal helium operations. The Bureau is currently reviewing the results of an independent study analyzing the issues relating to the valuation and potential disposition of the helium processing and distribution operations. Generally, we have found nothing in the study to indicate that the privatization initiative should not proceed.

The Administration urges the Senate to support fiscally responsible efforts to upgrade our emergency preparedness assets and to improve the Nation's ability to deal with potential turbulence in world oil markets through enactment of legislation to authorize the sale of the Naval Petroleum Reserve (NPR). The proceeds of this sale should be earmarked for the acquisition of oil for a 10 million barrel Defense Petroleum Inventory (DPI) and for increasing the fill rate of the Strategic Petroleum Reserve (SPR) to an average rate of 100,000 barrels per day. As many members of Congress have pointed out, now is the time to increase the fill rate of the SPR since oil prices are relatively low. Now is also the time to build the DPI since the NPRs are becoming less adequate for this purpose.

The enclosed fact sheet discusses these and other funding and language provisions that are objectionable to the Administration.

Enclosure

INTERIOR AND RELATED AGENCIES APPROPRIATIONS BILL, FY 1989
OBJECTIONABLE PROVISIONS

I. FUNDING LEVELS

Clean Coal Technology. The Administration urges that the $600 million requested for FY 1991 and FY 1992 be added to the bill.

Fossil Energy Research and Development. The bill would significantly increase spending for fossil energy research and development ($41 million or 12 percent over FY 1988 and $201 million or 120 percent over the request). It would maintain duplicate contractor research efforts that may result in additional future outlays (e.g, three coal-fired diesel engine research and development projects, and four separate coal-fired gas turbine projects). It includes numerous special interest and low priority items including university buildings with no direct benefit to the Federal government and several instances of continued funding for an entire slate of competing technologies, where it would be more appropriate to select the most promising one or two.

Energy Conservation. The bill includes increases of $204 million for conservation grants, offset by an expected $45 million in petroleum overcharge receipts. This additional amount is unnecessary because the States that would receive these funds have also received $2.9 billion from petroleum overcharge violation cases that they can use to fund conservation grant activities.

The bill includes significant increases in conservation research and development ($64 million and 79 percent over the request). It includes many special interest items that are inappropriate for Federal research.

Federal Land Acguisition. Substantial funds ($174 million) are added to the President's Budget for land acquisition by the Bureau of Land Management, the National Park Service, the Fish and Wildlife Service, and the Forest Service. Given the 730 million acres already in Federal ownership (one-third of the Nation) and the serious budget situation, discretionary land acquisition should be postponed, if it cannot be foregone. Adding more land is a lower priority than providing quality operations and maintenance of existing lands. Further, the Administration objects to bill language authorizing and directing the expansion of the White Mountain National Forest in New Hampshire and acquisition of the land by costly condemnation procedures.

Historic Preservation Fund. Funds ($30 million) are included for the Historic preservation fund whereas the President's Budget proposed no funding. The Federal Government already contributes hundreds of millions of dollars annually to the cause of historic preservation through tax code provisions. Financing State historic preservation offices and the National Trust for Historic Preservation is more properly a State and private responsibility.

Construction. Substantial funds ($143 million) are added to the President's Budget for construction by the Bureau of Land Management, the National Park Service, the Fish and Wildlife Service, and the Bureau of Indian Affairs. Only high priority construction projects, generally devoted to meeting health and safety needs, are proposed in the President's Budget. The additional construction projects are discretionary or non-critical and can be foregone or postponed. New construction is a lower priority than providing quality operations and maintenance of existing facilities.

Operations. A total of $150 million is added to the President's Budget to expand the operating budgets (exclusive of fire suppression) of various Interior bureaus, including the Bureau of Indian Affairs ($36 million), the U.S. Geological Survey ($23 million), the Bureau of Mines ($39 million), the Bureau of Land Management ($19 million), and the Fish and Wildlife Service ($25 million). The Committee has included numerous lesser priority or special interest projects.

Fire Fighting. The bill adds a total of almost $41 million to the President's Budget for fire suppression for the Department of the Interior. These funds are to be used to reimburse fire fighting costs that will be incurred by Interior bureaus in FY 1988. It is premature to add funds over the President's Budget until actual FY 1988 fire costs are known. The Budget represents a conservative estimate based on recent historical experience. If costs prove higher, the shortfall can be made up (with appropriate offsets) in an FY 1989 supplemental or the FY 1990 appropriation.

Forest Service. The bill adds $176 million in discretionary appropriations (excluding land acquisition and fire fighting) for low priority program operations and construction projects. Unwarranted increases include $3 million for research; $48 million for state and private forestry programs that are not a Federal responsibility; $27 million for facility, recreational, and general road construction; $49 million for recreation, fish and wildlife programs; and $11 million for soil, water, and range management.

Indian Health Services. To support increased Indian self-determination, the Administration urges the Congress to adopt the Administration's proposal to set aside funding in the bill for tribal operated hospitals and clinics. With such a distinction, the Federal government can demonstrate its long-term commitment to increasing tribal participation in the management and operation of health facilities. There is wide-spread support for separate funding among Indians and Alaska Natives. Without separate funding, Indian tribes have no way of knowing whether Federal support for self-determination contracting is waning, increasing, or remaining the same.

Indian Health Facilities. The bill includes $50 million for Indian health facilities. This amount is but the tip of an iceberg since the bill includes only partial funding for several inpatient and outpatient projects estimated to cost an additional $151 million. In addition, the need for these facilities is dubious. Funding for these facilities has continued to increase in recent years despite a 50 percent occupancy rate at IHS hospitals.

National Capital Arts and Cultural Affairs. The bill includes $5 million for general operating support on a non-competitive grant basis to Washington, D.C. arts and cultural organizations — a duplication of existing Federal nationwide competitive grants.

Abandoned Mine Land (AML) Fund. The Administration objects to adding $42 million tothe Abandoned Mine Land Reclamation Fund. Such an add-on is unnecessary because it will only increase the projected AML unobligated balance, which is expected to exceed $350 million by the end of FY 1988.

Strategic Petroleum Reserve. The Administration believes it is unnecessary and premature to add $1 million for the Strategic Petroleum Reserve (SPR) to initiate a review, evaluation, and site selection for additional facilities that would provide a 1 billion barrel capacity for the reserve. The study is unnecessary because recent analyses by the Department have shown that the benefits of adding additional increments to the SPR may not justify the significant costs (at least $5 billion). It is premature to add the funds because the current planned capacity of 750 million barrels will not be reached until FY 1992. The Administration periodically reviews market conditions to update its assessment of the need for additional capacity and can continue to do so with existing funds.

II. LANGUAGE PROVISIONS

Compliance with Non-Statutory Statements. Section 322 purports to require OMB and the agencies to comply with non-statutory statements issued by the managers of conference committees. This provision restricts the President's ability to execute the actual statutory language of appropriations legislation as concurred in by each House of Congress, presented to the President, and enacted into law. The "instructions and the specific allocations and earmarking of funds contained in the joint statement of managers" are neither voted on by Congress, nor presented to the President.

We thus believe that, to the extent it purports to make non-statutory "instructions" binding on the Executive Branch, Section 322 attempts to bypass the "express procedures of the Constitution's prescription for legislative action: passage by a majority of both Houses and presentment to the President." (INS v. Chadha, 462 U.S. 919, 958 (1983).) This departs from the intended constitutional design. The non-statutory "instructions" may or may not be carefully considered by a majority of the members of both Houses, and may or may not even be consistent with the law as actually signed. If Congress wishes to provide for the enactment of the managers' "instructions," it may quite properly do so consistent with the Constitution by incorporating them in legislation voted by each House and presented to the President.

Moratoria on Outer Continental Shelf (PCS) Leasing. The Administration objects to language excluding areas of the North Atlantic (section 112), California (section 111), and Florida (section 110) from the offshore leasing program. These moratoria contradict the statutory mandate of the OCS Lands Act designed to expedite exploration and production consistent with proper balancing of environmental and other concerns. They override the process of scientific studies and balancing analysis required by sections 18 and 19 of the OCS Lands Act. The Interior Department current estimate is that the moratoria would reduce anticipated FY 1989 receipts by $155 million — $125 million from California leases and another $30 million from Florida and the North Atlantic leases.

In addition, the proposed moratoria language may increase the potential liability of the U.S. by preventing the Secretary from approving plans or activities on existing leases off the Florida coast south of 26 degrees North latitude. This potential liability nay not be limited to the millions of dollars in expenditures incurred to date by the companies holding these leases.

Language that accelerates OCS sale No. 95 in Southern California is also objectionable because it undermines the purposes of the OCS Lands Act (like moratoria) and uses questionable procedures (such as avoiding full environmental studies) that appear to be contrary to the Act. Further, moving receipts from FY 1990 to FY 1989 only exacerbates the FY 1990 deficit. It does nothing to address Congressional concerns and to ensure that areas under moratoria are eventually offered for leasing consistent with OCS legal and environmental requirements.

Privatization of Helium Operations. The Administration has serious concerns about the policy implications of language that prohibits the Bureau of Mines from proceeding with the sale of Federal helium operations. The Bureau is currently reviewing the results of an independent study analyzing the issues relating to the valuation and potential disposition of the helium processing and distribution operations. Generally, we have found nothing in the study to indicate that the privatization initiative should not proceed. However, the study raises certain issues concerning transition and specialized needs of Federal agencies that need to be addressed. The Bureau is continuing its review and has formally solicited public comment on the consultant's report and other relevant issues. Where feasible, and consistent with the President's privatization initiative, the production of such goods and services should be shifted to the private sector in order to reduce Federal expenditures and take advantage of the efficiencies that normally result when services are provided through the competitive marketplace.

SPR Petroleum Account/Naval Petroleum Reserve. The Administration urges the Congress to support fiscally responsible efforts to upgrade our emergency preparedness assets and to improve the Nation's ability to deal with potential turbulence in world oil markets through enactment of legislation to authorize the sale of the Naval Petroleum Reserve (NPR). The proceeds of this sale should be earmarked for the acquisition of oil for a 10 million barrel Defense Petroleum Inventory (DPI) and for increasing the fill rate of the Strategic Petroleum Reserve (SPR) to an average rate of 100,000 barrels per day. As many members of Congress have pointed out, now is the time to increase the fill rate of the SPR since oil prices are relatively low. Now is also the time to build the DPI since the NPRs are becoming less adequate for this purpose.

SPR Petroleum Account. The Administration strongly opposes the Committee's action to reduce FY 1989 budget authority and to provide an advance appropriation for FY 1990. Any FY 1989 orders, regardless of the time of delivery, must be made within available funds. Delaying the obligation of these funds until October 1, 1989 might delay the deliveries. Further the reduced FY 1989 appropriation inhibits the flexibility of the Department to respond to changes in oil prices. It sets a bad precedent to change financing to meet budget targets rather than reducing unnecessary programs.

Federal Tort Claims. By continuing Federal tort claims coverage to Indian Health Service tribal contractors, the bill continues the unacceptable practice of maintaining a special class of government contractors effectively immune from responsibility for their tortiously liable conduct. The Administration's position on this proposal is stated in a Justice Department letter to Senate Appropriations Committee Chairman Stennis dated September 21, 1987.

Spouse Travel. The Administration requests that the Senate approve substitute language on reimbursement of travel expenses for spouses who accompany prospective Indian Health Service physicians for pre-employment interviews. Under current law, payment of spouse travel for pre-employment interviews of prospective Federal employees is not authorized for any agency except IHS. However, because of the unique conditions of employment faced by PHS physicans employed at remote Indian reservations or traditional Indian lands, a narrowly drawn exception to current law can be accepted. The substitute language would permit spouse travel reimbursement, as determined by the Department of Health and Human Services, only where the pre-employment interview concerns possible employment at remote Indian sites that are not within reasonable commuting distance of a town or city. Thus, spouse travel would not be reimbursed if the pre-employment interview concerns employment near large and medium sized communities.

Legislative Vetoes. The Administration objects strongly to language in the bill purporting to prohibit the Executive Branch from taking certain actions without prior approval of the Appropriations Committees. Such restrictions breach constitutional requirements as enunciated by the Supreme Court in INS v. Chadha. Most objectionable is an administrative provision that would prevent the National Park Service from reprogramming funds (unless approved in advance by the Appropriations Committees) "to maintain law and order in emergency and other unforseen law enforcement situations and conduct emergency search and rescue operations in the National Park System." This provision is contrary to legal duties to enforce the law and to preserve life and property.

Impediments to Proper Management. Several provisions in the bill impede the ability of the Executive Branch to manage programs properly and effectively. Examples of such intrusions into Executive Branch responsibilities include prohibitions on changing regional boundaries and office locations of the Forest Service as well as the closing or consolidating of Bureau of Mines research facilities (even though there are no current plans to do so), and implementing proposed eligibility regulations of the Indian Health Service.

A prohibition on taking any action to adjust the National Park Police pay to competitive levels interfers with existing statutory responsibilities of the Office of Personnel Management. It also would prohibit the Department of the Interior from using funds to follow guidance in the report to "consult with the Committee prior to seeking additional,special pay treatment for Park Police."

The Administration objects to new language concerning Federal management of Federally owned wildlife refuges. State management of Federally owned lands is authorized and is being practiced in accordance with the Fish and Wildlife Act of 1956 and the National Wildlife Refuge System Act of 1966. To constrain this practice is potentially inefficient and inconsistent with our experience in managing under these Acts. Since any management by States must, under current law, conform to Federal standards, we ask that the language be deleted.

The Administration objects to language for the National Endowment for the Arts that would intrude into the agency's grant-making process. The language would limit the Endowment's ability to assure an orderly and accountable grantmaking process and intervene in an issue that has long since been settled in a context that fully involved artistic peers, the National Council on the Arts and the Chairman.

Bureau of Indian Affairs. The Administration continues to support requested language to implement the tribal self-government demonstration project. Although Congress is working on separate authorizing legislation to implement the demonstration project, there is no assurance that such legislation will be enacted before FY 1989. The Administration objects to language prohibiting the publishing of higher education regulations required to implement needed program reforms and update provisions included in current law.

The Administration objects to language that would prohibit the closure of Phoenix Indian School until passage of authorizing legislation. It is costly and inefficient to operate a huge 500-student boarding facility with only about 75 students. Furthermore, once legislation passes, it would be highly unfair to these students to move them in the middle of a school year rather than to place them before the 1988-89 school year starts.

The Administration objects to language that would distribute about $1 million to six Indian tribes that recently took possession of the Chilocco School Reserve in Oklahoma from the U.S. This amount represents leases and royalties generated by the Reserve while it was Federally owned and administered. Distributing these funds, which have already been deposited in the Treasury and used to reduce the Federal deficit, would set a bad precedent for future land transfers to Indian tribes or any other entities.

Bikini Resettlement Trust Fund. The Administration objects to the inclusion of language providing $5 million to the Bikini resettlement trust fund with the balance of $85 million provided over the next five years. It is inappropriate to provide funds for the resolution of the Bikini resettlement until appropriate documentation and analysis of costs and legal obligations associated with the resettlement have been determined.

Bureau of Land Management (BLM) Recordation and Filing Fees. The Administration objects to the earmarking of BIM recordation and filing fees for claims processing, compliance, enforcement and reclamation involving mining of hard-rock minerals. While increased funding for these activities appears justified, this should be provided directly via the appropriations process and subject to the scrutiny provided other activities. Any fees (such as the increased fees currently under review) should be credited to the General Fund of the Treasury, as is the case under current law.

Timber Receipts. The Administration objects to language appropriating for FY 1989 National Forest Fund timber receipts received by the Treasury during FY 1988 in excess of the National Forest Fund timber receipts contained in the President's Budget proposal for FY 1989. The language would change the existing statutory distribution of the National Forest Fund receipts. Funding would be earmarked for operating program expansion, thereby increasing outlays to the detriment of the General Fund of the Treasury.

Conveyance of Land. The Administration opposes language that would convey without compensation an existing Forest Service research facility to Arizona State University in Tempe, Arizona. Further, moving the laboratory will cost over $5.6 million and be disruptive to the research program.

Restoring Hetch Hetchy Valley. The Administration opposes the bill language that prohibits the use of funds to study the idea of restoring the Hetch Hetchy Valley in the Yosemite National Park (CA). Carrying out such a study is the only way to find out if it is economically and environmentally feasible to restore this valley to its original state of outstanding natural beauty.

Employment Ceilings. Section 310 of the bill appears to exempt programs funded by the bill from employment ceilings. The Administration opposes this provision because it prevents effective and efficient management of agency programs and promotes wasteful spending.

Required Supplementals. Sections 101 and 102 of the bill require that supplementals "must be requested" to replenish funds transferred to cover emergencies. To the extent that these provisions purport to require the President to propose legislation seeking supplementals, they are inconsistent with the President's constitutional and statutory authority to propose legislation. The President retains discretion on whether and when to request supplemental appropriations.

Employee Details. Section 109 of the bill is superfluous language included to prevent detailing of employees except as provided by Office of Personnel Management regulations.