Statement of Administration Policy: S. 2836 - Indian Reservation Road Construction Act

(SENT 9/14/92)
(Senate)
(McCain (R) AZ and DeConcini (D) AZ)

The Administration opposes S. 2836 because it would unnecessarily reduce the amount available from the Highway Trust Fund's Indian Reservation Roads (IRR) Program and violate the 1990 Credit Reform Act.

S. 2833 would set-aside 2.5 percent of the IRR allocation to make loans at the request of a tribe to a State for road construction on Indian reservations. Contrary to claims of the bill's proponents, the tribes are using all the IRR funds available, and no portion of the annual IRR allocation remains unobligated. In fact, a substantial need for IRR funds now exists. Furthermore, the bill would authorize loans to States without regard to the existing allocation process, other priority but unfunded IRR projects, or demonstrated need. To do so would penalize reservation communities that are in need of safe and accessible roads.

Moreover, the bill could affect the "maintenance of effort" requirement in current law and allow the States to direct State funds that should have been used for IRR projects to State highway projects.

Finally, S. 2836 would establish a credit program that is unnecessary and does not conform to the 1990 Credit Reform Act. In general, Federal credit programs are appropriate only when there is a market imperfection or when there is a need to subsidize a specific group of borrowers. Because States are now able to borrow on reasonable terms and conditions, there is no need for this program. Moreover, the proposed loan program fails to comport with the 1990 Act, inasmuch as loan repayments would be used for new loan obligations. The Administration opposes any legislation that does not conform to the 1990 Act.