Statement of Administration Policy: H.R. 5257 - Departments of Labor, Health and Human Services, and Education, and Related Agencies Appropriations Bill, FY 1991

(House Floor)
(Sponsors: Whitten (D), Mississippi; Natcher (D), Kentucky)

The Administration continues to oppose Congressional action on appropriations bills in advance of a budget summit agreement. Such action could, unnecessarily and perhaps harmfully complicate implementation of a final budget resolution that reflects the agreement. However, inasmuch as the House is apparently going to take action, the Administration will express its views on these bills as they come before the House. The purpose of this statement is to express views on the Departments of Labor, Health and Human Services, and Education, and Related Agencies Appropriations Bill, FY 1991, as reported by the Committee.

The Administration commends the Committee for retaining, without change, language that restricts the use of Federal funds for abortions to only those circumstances in which the life of the mother would be endangered if the fetus were carried to term.

The total level of funding provided by the House Committee threatens the President's approval of H.R. 5257. There are a number of programs on which the Committee has deferred action pending authorization. After adjusting for these programs, the bill would increase total budgetary resources (including limitations on obligations) by $4.6 billion above those requested by the President in his fiscal year 1991 Budget. The FY 1991 outlay effect of this increase is over $1.6 billion. Furthermore, this large increase would have significant out-year implications. Increases of this magnitude are unwarranted. The President's request for programs contained in this bill already provides for increases of $1.5 billion in budget authority and $3.6 billion in outlays above comparable FY 1990 levels.

The Committee provided discretionary funding for the Department of Education of $20.4 billion, an increase of $1.7 billion, or nine percent, over the President's budget request and fifteen percent over FY 1990 enacted discretionary levels. Similarly, the Committee provided excessive funding increases for the National Institutes of Health, which would add to the large out-year funding commitments that already exist. In addition, the Committee provided $371.5 million above the Administration's request for authorized Training and Employment Services activities. The Administration hopes that once the Job Training Partnership Act amendments are enacted, the Committee will reconsider its funding proposal and finance this account Mffhin the President's request.

These and other concerns are discussed in the attachment.

Attachment

(House Floor)

DEPARTMENTS OF LABOR, HEALTH AND HUMAN 8ERVICES, AND EDUCATION, AND RELATED AGENCIES APPROPRIATIONS BILL, FY 1991

MAJOR PROVISIONS OPPOSED BY THE ADMINISTRATION

A. Funding Levels

Department of Labor:

Training and Employment Services (TES). The House Committee's funding proposal for Training and Employment Services assumes that the current structure of programs authorized by the Job Training Partnership Act (JTPA) will exist in FY 1991. However, Congress currently is considering bipartisan legislation that would reform anc alter JTPA's program structure beginning in 1991. When the JTPA amendments are enacted, the Administration urges the Committee to reconsider its funding proposal and finance this account within the President's 1991 budget request. The FY 1991 Committee level is $371.5 million above the Administration's request. The principal objectionable additions are discussed below.

The Administration objects to the Committee's $155 million add-on to its funding request for JTPA's title II-A block grant program, which would raise the total tc $1.9 billion. In the absence of JTPA reform, the President's request would ensure that block grant services continue at the 1990 level, permitting some 850,000 new enrollees to participate in training and related services in 1991.

The Committee's $114 million increase in funding (to a total of $514 million) for JTPA's dislocated worker program is unwarranted. Existing data on trends in worker dislocation show modest declines in the eligible population during the 1980's. The Committee's funding increase anticipates a reversal in this trend and includes financing for services for potentially-eligible members of the armed forces who may be covered under other arrangements. The Committee also includes $71 million elsewhere to fund training activities for Trade Adjustment Assistance recipients. This raises to $585 million the resources for training dislocated workers — far in excess of the amount needed.

The Administration opposes the $73 million increase to its FY 1991 request for the Job dorps, which raises the FY 1991 level to $890 million. The Committee's action would boost the average annual per slot operating cost to over $19,900. The Committee's plan for long-term expansion of this expensive program is unwise in the current budgetary climate. Instead, the President's proposed title II-B youth program would target -the Job Corps eligible population for comprehensive educational and job training services. The Administration also opposes the Committee's $10.5 million add-on to restore the effects of the FY 1990 sequester. There is no reason to treat the Job Corps differently than other programs affected by the sequester. The Job Corps plans to achieve program savings through orderly slot reductions at selected centers where dormitory renovations are needed. No current enrollees would be affected.

State Unemployment Insurance and Employment Service Operations. The $104.9 million increase above the request for the Employment Service would provide a total of $825 million for State Grants, increasing funding for this program by almost six percent over the FY 1990 level. Such an increase is simply not warranted for a lower-priority program when many other government programs have had to be held level or even reduced to meet fiscal constraints. This increase should be eliminated.

The increase of $21.7 million for Unemployment Insurance would allow the conversion of temporary staff to permanent status and the hiring of additional permanent staff, but it would result in no more processing of claims, in total, than the budget request. In essence, this increase would amount to spending more money to do the same amount of work. The Administration opposes this increase. The Administration would not object to the increase if it were added to the "contingency" amount in the request. Such action would make the resources available only to hire additional temporary staff to process additional claims that could develop if the economy does not perform as well as expected.

Community Service Employment for Older Americans (CSEOA). The Administration objects to the House Committee's $57 million add-on to the FY 1991 request for the Community Service Employment for Older Americans program. The Committee justifies the increase as the amount needed to maintain service levels and finance higher program costs associated with the Federal minimum wage increase. However, the $400 million FY 1991 appropriation for CSEOA is nearly $7 million over the amount necessary to maintain FY 1990 service levels in the program, even after the effects of the FY 1990 supplemental appropriation are included. The Administration's FY 1991 request for CSEOA would achieve program reductions through attrition, so that no current participants would lose their community service jobs.

Salaries and Expenses. The House Committee has provided increases totaling $29.3 million for the various Department of Labor salaries and expenses appropriations. The Administration's request for FY 1991 is $80 million over the comparable FY 1990 level, a substantial increase (about six percent) given this year's very tight budget constraints. The Committee additions are primarily for new programs not key to agency missions or for restoration of low-priority programs. The additions above the request should be deleted.

Department of Health and Human Services:

Health Care Financing Administration Program Management and Medicaid. The House Committee has chosen not to adopt the President's Budget request to fund survey and certification activities with a new revolving fund, financed by provider-paid user fees. Thus, $195 million of FY 1991 proposed Medicare savings and $113 million of Medicaid savings would be lost. The Committee is urged to adopt the President's proposals.

Interim Assistance to States for Legalization (SLIAG). The Committee did not consider the President's proposal to reduce excess permanent budget authority for SLIAG. The Appropriations Committee is urged to reduce SLIAG by $538 million as proposed in the President's budget as States' expenses have been much lower than originally expected.

National Institutes of Health (NIH). The Administration is pleased that the Committee shares the President's commitment to biomedical research but is concerned that instead of leading NIH toward "stability and predictability," the Committees's large funding increases may contribute further to the present funding instability by creating large out-year commitments. The biomedical research community is grappling currently with the effects of large commitments made in previous years. Until NIH management can implement measures to respond to the Committee's concerns about "the increasing cost of grants which has routinely exceeded all reasonable measures of inflation" and other related issues, it would not appear prudent to add such a sizeable increment to NIH research grant funding.

Additionally, the Administration is concerned that the Committee did not adopt the increase requested for the Human Genome project, instead choosing to add sizeable amounts to research grants and an unprecedented $150 million over the President's request .for NIH research facilities. Finally, the Administration notes that the Committee neglected to include two proposals the Administration suggested for improving the NIH: a proposal to give the NIH Director discretion to direct up to one percent of NIH appropriations to important research opportunities as they emerge, and a proposal to establish 10 endowed chairs at NIH to attract senior scientists.

Alcohol. Drue Abuse and Mental Health Administration (ADAMHA). At the same time that the Committee has added over $4.6 billion to the President's request, it has failed to fund several Presidential priorities, particularly with regard to drug treatment and prevention programs. For example, the levels provided by the Committee for ADAMHA's drug abuse activities are approximately $150 million below the levels requested by the Administration. The 1991 Drug Control Strategy calls for these monies to be used primarily for treatment grants for high risk populations and to stimulate drug abuse prevention within local communities. The House is urged to fund these increases within the levels provided in the President's request.

Health Professions. The Administration is pleased that the Committee met the FY 1991 Budget's requests for increases in support of the three high-priority health professions training programs that do the most to ensure that disadvantaged and minority students can pursue a health professions education. The Administration is concerned, however, by the Committee's action to fund a myriad of other outdated, untargeted, and low-priority grants for health professions schools and students. After over two decades of Federal support, the aggregate shortage of health professionals that was perceived in the 1960's when these subsidies were initiated has abated. Approximately $4 billion remains available to help students finance their training in the health professions through Medicare medical education payments, health professions scholarships, guaranteed and other student loans, and Department of Education grants and loans.

Department of Education:

Total Funding for the Department of Education. For the programs it considered, the Committee provided discretionary funding of $20.4 billion, an increase of $1.7 billion, or nine percent, over the President's budget request (adjusted for items on which the Committee deferred action). This increase is not justified either by any reasonable assessment of the Federal role in education or by the results that could be expected from such an increase. The President's request is already six percent over discretionary funding for FY 1990, an ample increase to support important programs.

School Improvement Programs. The Committee fails to provide adequate funding for the Eisenhower Mathematics and Science Education program. The $30 million reduction from the President's request will hamper Federal, State, and local efforts to meet the critical national education goal of becoming first in the world in science and mathematics achievement by the year 2000.

The Administration is further disappointed by the Committee's failure to provide funding on a contingent basis for the three Presidential initiatives in this account: alternative certification, Presidential teacher awards, and Magnet schools of excellence. These initiatives are of the same importance as Merit schools, for which the bill would allow the transfer of funds if authorizing legislation is enacted by December 31, 1990.

Education Research, Statistics and Improvement. Although the Committee provides an increase of almost $39 million over the FY 1990 level for activities in this account, the total does not to include any funding for the Principal training program and provides only half the amount requested — $10 million — for followup activities related to the national education goals.

Compensatory Education for the Disadvantaged. The Committee provides a total increase of $532.7 million over comparable activities included in the President's budget and $1.0 billion over the comparable FY 1990 level. Increases of that magnitude are unwarranted in this time of budgetary constraint. Moreover, the infusion of additional funds would not automatically result in expansion of services to previously unserved students. Although the total for the account includes increases of over $532 million, the Committee provided only a contingent appropriation of $100 million for the Presidential Merit Schools program, rather than the $225 million requested by the President.

Education for the Handicapped. The Administration objects to the increase of $646 million over the President's request. The majority of the increase is provided for Grants to States, for which the President's budget already provides a four percent increase over FY 1990 levels.

Student Financial Assistance. The Administration objects to the $220 million provided for two student aid programs: $160 million for Federal capital contributions to Perkins loan funds and $60 million for State Student Incentive Grants (SSI6). Federal capital contributions should not be provided because Perkins loans provide heavy and unnecessary Federal interest subsidies to students. Federal funding for the SSIG program is no longer needed to encourage States to provide need-based aid. All States presently provide need-based student aid.

Higher Education. The bill provides a total of $763.6 million for FY 1991, an increase of $105.9 million over the President's FY 1991 Budget request. This amount includes a 27 percent increase, or $72.3 million over the President's request for the TRIO programs (Special Programs for the Disadvantaged). While these programs have important goals, their design and operation need substantial reconsideration in the context of the upcoming Higher Education Act reauthorization. Funding should not be significantly increased at this time.

Impact Aid. The Committee provides $139 million over the President's request, the majority of which is for payments for "b" children. Most of these children do not pose a significant burden on schools since they come from families who pay taxes or whose presence otherwise contributes to the local economy. The President's proposal to provide $25 million for "b" children who reside in public housing would adequately compensate districts for children who pose a significant burden. The House is urged to adopt the President's proposal to reduce funding for "b" children.

Libraries. The Committee provides $102 million in excess of the President's budget request by continuing funding for two State formula grants programs: grants to public libraries and grants for public library construction. The public library system is flourishing throughout this country. A continued infusion of Federal funds to defray operating or construction expenses of an activity that is clearly a State and local responsibility is not appropriate.

Bilingual Education. The Committee failed to provide $12 million the Administration sought for school districts with recent influxes of limited English proficient students. The House is urged to reallocate funding within the account to provide for the President's proposal.

Other Independent Agencies:

Railroad Retirement Board (RRB). The bill provides $2.9 million to the RRB's Limitation on Administration and Unemployment Insurance Administration accounts for the five-year, lease-to-purchase costs of installing a mainframe computer. The Administration's FY 1991 Budget proposal requested $9.8 million for the outright purchase of such equipment. The Committee's switch to a lease-to-purchase scheme will add some $3 million to the cost over the next few years. The Administration's outright purchase option is the less expensive of the alternatives in the long run. The House is urged to adopt the President's funding proposal.

The Administration proposed that in FY 1991 $321 million be made available for the Federal Windfall Payments account to pay supplemental benefits. One quarter of the amount allocated to the Windfall account was to come from the Railroad Retirement Account, rather than as a subsidy from the general fund. The Committee's language, which rejects the Administration proposal, would offset the appropriation with income taxes deposited in the Windfall account that the Committee claims are mandatory. These income taxes are a direct result of discretionary appropriations by Congress.

OMB recently completed a Management Review of the programs of the RRB. Based upon that review, the workload of the Inspector General is expected to increase significantly in FY 1991 and beyond. The House is urged to provide the President's request of $7.7 million.

B. Language Provisions:

Department of Labor:

Training and Employment Services. The Administration opposes the inclusion of unnecessary earmarks, particularly language providing three-year availability of $63.7 million for the Job Corps program. These earmarks should be dropped.

Salaries and Expenses for the Occupational Safety and Health Administration (OSHA) and the Mine Safety and Health Administration (MSHA). The Administration objects to the restrictive language included for OSHA and MSHA which limits the enforcement of the Occupational Safety and Health Act and the Federal Mine Safety and Health Act. Such language is an encroachment on executive authority and accordingly, should be removed from the bill.

Sections 103 and 104 of the General Provisions. The Administration objects to these sections of the Department of Labor General Provisions which would limit the Department's flexibility to administer the Job Corps Program. Section 103 prohibits contracting the operation of certain Job Corps Centers to nongovernmental agencies, while section 104 restricts the use of Job Corps funds for paying legal expenses in criminal cases.

Department of Health and Human Services:

Foster Care. The Administration regrets that the Committee did not include language restraining the rate of growth in foster care administrative payments. Administrative costs have been growing unchecked. According to the HHS Inspector General, these increases have not been associated with any concurrent increase in the quality or quantity of services for children. States are refinancing existing State foster care outlays through the Federal Treasury by means of Title IV-E. By FY 1991, foster care administrative and training expenditures will represent over 50 percent of total foster care outlays. In the District of Columbia alone, as of FY 1988, 81 cents of every Federal dollar spent on foster care financed administrative costs, while only 19 cents actually maintained children in foster homes. The House should adopt language to begin restraining the skyrocketing foster care administrative costs.

Health Care Financing Administration Program Management and Medicaid. The Committee has modified Medicare contractor contingency language to allow for the release of funds for unanticipated costs. The Administration believes contingency funds should only be used to finance unanticipated increases in contractor workload. Allowing use of these funds for unanticipated costs reduces the incentives for the Department to control such costs. This increases the likelihood that contingency funds will be spent in FY 1991.

Health Education Assistance Loan Guaranree program (HEAL). The Administration supports the Committee's initial step to limit the default-plagued Health Education Assistance Loan Guarantee Program. The Committee justifies its action to limit FY 1991 obligational authority to $260 million by stating that "some limitation is warranted in view of rising default obligations." This statement marks an important acknowledgement of the problem. The Administration recommends that the House take the next full step recommended in the President's Budget of further limiting the increase in default liability by limiting FY 1991 loan commitments to $185 million. Taking this stronger step would limit the Government's future exposure to defaults arising from this ill-designed loan scheme. Given that the Government's total liability from the nearly $2 billion in loans already outstanding could be substantial, it would be fiscally prudent to limit FY 1991 obligational authoritv to S185 million.

Public Health Service. HIV/AIDS Funding. The Administration notes that by not repeating its action last year to allow the Secretary to transfer AIDS funds among Public Health Service accounts, the Committee bill could impede progress against HIV/AIDS. The HIV/AIDS epidemic requires administrative flexibility to address emerging opportunities. The House is urged to provide the Secretary of Health and Human Services the authority to transfer AIDS funding among Public Health Service accounts by adopting the flexibility language proposed in the President's FY 1991 Budget.

Department of Education:

Student Financial Assistance. While modifying student aid programs in other ways in appropriations language, the Committee failed to provide the requested language to limit use of the "ability to benefit" eligibility rule. This failure means continuation of documented abuses by many schools, higher loan defaults, and more unwitting students harmed.

The attached data tables can be downloaded in PDF format by clicking this link