Statement of Administration Policy: S. 2182 - National Defense Authorization Act for Fiscal Year 1995

(Senate)
(Nunn (D) GA)

The Administration supports S. 2182, but has serious reservations regarding certain provisions of the bill. The Administration will work with Congress to resolve its concerns and other issues that may be identified during the Administration's further review of the bill.

S. 2182 provides for many of the Administration's key national security programs, including: (1) readiness (including funding for the Defense Business Operations Fund); (2) the proposed C-17 airlifter settlement between the United States and McDonnell Douglas; (3) the CVN-76 and other shipbuilding programs; (4) the B-2 Bomber, F/A-18 E/F, F-22, V-22, and E-8C Joint Stars aircraft programs; (5) defense reinvestment; (6) payments to the United Nations for peacekeeping activities; (7) Cooperative Threat Reduction (Nunn-Lugar); (8) military-to-military contacts; (9) environmental restoration programs; (10) NATO infrastructure; (11) industrial mobilization authorities; and (12) certain military construction programs.

S. 2182, however, contains several provisions that are inconsistent with the President's FY 1995 Budget request. The Administration urges the Senate to amend these provisions to make them consistent with the President's request. These provisions would:

—      Reduce funding for high priority programs, including: (1) procurement of F/A-18 C/D aircraft by $250 million; (2) construction of two chemical demilitarization facilities by $261 million; and (3) the relocatable-over-the-horizon radar by $13.8 million.

—      Divert $601 million that is needed for sealift ships to fund an amphibious assault ship (LHD-7) that will not be required for several years.

—      Divert $43.0 million from the National Defense Sealift Fund to establish a National Defense Features program, sacrificing needed sealift for the Ready Reserve Force.

—      Authorize more than $1.5 billion for unrequested acquisition programs, including: (1) bomber industrial base preservation, (2) National Guard and Reserve equipment, (3) M1A2 tank upgrades, (4) Army tactical missiles (Javelin, Hellfire, and Stinger), (5)   Marine Corps prepositioning ships, (6) precision guided munitions, and (7) limited reactivation of SR-71 surveillance aircraft.

—      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.

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

—      Authorize Reserve end strengths of 9,290 more than requested. The potential annual cost of the additional personnel is over $100 million.

—      Prevent closure of the Uniformed Services University of the Health Sciences (USUHS), as recommended by the National Performance Review. Failure to close the USUHS would increase Department of Defense spending by $286 million between FYs 1995 and 1999 and by over $60 million annually thereafter.

In addition, the Administration opposes those provisions that would:

—      Require 15-day advance reporting before initial deployment of U.S. combat forces. This is inconsistent with the President's constitutional prerogatives and responsibilities.

—      Reauthorize a joint committee to review U.S. counter proliferation programs. The National Security Council is leading a review of the coordination of research and development in the nonproliferation, counter proliferation, and arms control areas. The proposed committee could prejudice the outcome of this review.

—      Transfer responsibility for tritium production from the Department of Energy to the Department of Defense. This function should remain with the Department of Energy, which has cradle-to-grave responsibility for the maintenance and reliability of nuclear warheads.

—      Assign the Secretary of Defense responsibility for: (1) reporting on reforming multilateral peace operations; (2) providing certain humanitarian assistance; and (3) reviewing compliance with the ABM Treaty. Such authorities should be vested in the President.

—      Create new exemptions from various labor laws and authorize the military departments to use inmates of State and local correctional facilities to perform certain labor on military installations. This provision could easily displace gainfully employed workers and disrupt local economies.

—      Require the Secretary of the Army to transfer M1A1 tanks from the active Army to the Marine Corps Reserves. This undermines long-standing defense policy regarding the transfer of tanks between the military departments.

The Administration also opposes the following provisions that would increase direct spending by: (1) extending civil service retirement benefits to Department of Defense non-appropriated fund employees, and (2) requiring the Department of Defense to pay for extension of Medicare Part B benefits to military retirees who live in communities where a military treatment facility is slated for closure. These provisions would result in an approximate increase $0.6 billion in direct spending, which the bill does not fully offset.

Finally, the Administration would strongly oppose amendments that would fund entitlement programs (retiree COLAs) with discretionary funds. This would undermine the principle that new mandatory spending should be offset by reductions to existing mandatory spending and would establish an undesirable precedent for future funding of entitlement programs.

Pay-As-You-Go Scoring

S. 2182 would increase direct spending and receipts; it is, therefore, 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.

If the direct spending provisions in the bill are not fully offset, they could contribute to a sequester of mandatory programs

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