Statement of Administration Policy: H.R. 5229 - Department of Transportation and Related Agencies Appropriations Bill, FY 1991

(Senate Floor)
(Sponsors: Byrd (D), West Virginia, Lautenberg (D), New Jersey)

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 Congress is apparently going to take action, the Administration will express its views on these bills. This statement expresses the Administration's views on the Department of Transportation and Related Agencies Appropriations Bill, as reported by the Senate Appropriations Committee.

Consistent with the Administration's concern that appropriations action could complicate implementation of the Budget Summit Agreement, the President's senior advisors would recommend that he veto any appropriations bill that exceeds the President's request for either budget authority or outlays if that bill is presented to him before the completion of the Summit.

The Senate Committee bill would increase total budgetary resources (including limitations on obligations) by over $4 billion above those requested by the President in the fiscal year 1991  Budget. The FY 1991 outlay effect of this significant increase is over $1 billion. Furthermore, this large increase in budgetary resources would increase outlays significantly in FY 1992  and thereafter. In particular, the $2.5 billion in additional budgetary resources provided for the highway program would increase outlays in FY 1992 by over $1.3 billion.

The Committee continues to add special funding, outside the regular Federal-aid highways program, for highway demonstration projects. In this bill alone, the funding for these projects is $300 million. This $300 million is in addition to the $178 million authorized in FY 1991 for special projects designated in section 149 of the 1987 Surface Transportation Act, making a total of $478 million. Should the final appropriations act contain all of the Senate and House demonstration projects, the total cost in FY 1991 alone would be over $717 million. Continued Congressional earmarking would further erode the ability of State transportation planners to make sound transportation decisions, would distort the apportionment formulas, and would reduce equity among the States.

The Administration objects to the $165 million provided by the Committee to initiate a new rail electrification project on the Northeast Corridor that would require a multi-year program and up to $600 million to complete. The Northeast Corridor Improvement Program has fulfilled its original mandate to renovate the Corridor. New projects on the Corridor should be justified and financed as are other Amtrak capital projects — evaluated and authorized by Amtrak's Board of Directors and financed through available corporate funds. Finally, the Senate Committee has used a budget gimmick to shift outlays associated with the new program from FY 1991 to FY 1992.

The Senate assumes the use of $300 million of Department of Defense appropriations to fund services for the Coast Guard. The Administration strongly opposes the practice of diverting funds from needed Department of Defense programs to augment inadequate appropriations for the Coast Guard.

Although the Senate Committee provides $101 million more than the House to fund FAA's modernization of air traffic control equipment, the Committee bill reduces funding for facilities and equipment by a net $260 million below the President's request. The Senate is urged to fund fully the FAA facilities and equipment account.

These and other concerns are discussed more fully in the attachment.

Attachment

(Senate Floor)

H.R. 5229 - TRANSPORTATION AND RELATED AGENCIES APPROPRIATIONS BILL, FY 1991

MAJOR PROVISIONS OPPOSED BY THE ADMINISTRATION

A. Funding Levels

Coast Guard

Use of Department of Defense Appropriations to Fund the Coast Guard. The Senate assumes that $300 million of Department of Defense appropriations would be used to fund Coast Guard programs. The Administration strongly opposes the practice of diverting funds from needed Department of Defense programs to augment inadequate appropriations for the Coast Guard.

Federal Aviation Administration (FAA)

Facilities and Ecmipment. The Senate Committee bill reduces funding for Facilities and Equipment by a net $260 million below the President's request. This reduced level of funding would delay modernization of the air traffic control computer system. The cuts for the Advanced Automation System, as well as other projects, would cause contract delays that would result in increases in future project costs.

Federal Highway Administration (FHWA)

Federal-aid Highways Obligation Limitation. The Administration strongly opposes the Federal-aid highway obligation limitation of $13.8 billion, which is 15 percent higher than in FY 1990 and the highest level in the history of the program. This limitation, together with exempt obligations, would increase outlays over the President's request by $400 million in FY 1991.

Section 105(f) Bonus Provision. The Administration objects to language included by the Senate Committee for the Section 105(e) and (f) bonus provision because it would provide additional obligations of $179 million over the obligation limitation set for the given year. The bonus provision would permit fast-spending States to obligate up to five percent of their unobligated balances.

Highway Demonstration Projects. Funding for demonstration projects has reached an all time high of $300 million in the Committee reported bill. This is a fifteen fold increase from the 1987 Senate appropriations bill. Should the final appropriations bill contain the combined House and Senate earmarkings, the total bill will be almost $540 million, more than double the amount for demonstration projects in last year's appropriations act.

Urban Mass Transportation Administration (UMTA)

Formula Grants. Formula operating subsidies are funded at $504 million above the President's request and are available to all urban areas regardless of population. The additional funding would be made available to cities of over one million in population. The Administration has proposed eliminating operating subsidies for these cities since Federal subsidies constitute, on the average, less than six percent of their total operating budgets.

Washington Metro. The Senate Committee provides $64 million for the Washington Metro. Although the Administration agrees with the Senate's decision not to appropriate funds beyond the current authorization, the Senate funding level is still $26 million above the President's request. The President's request of $38 million is consistent with the 1986 full funding agreement and is sufficient to meet the FY 1991 cost associated with construction of the 89.5 mile system.

Federal Railroad Administration (FRA)

Amtrak. The Senate Committee provides $620 million for Amtrak. The President's budget requested that Federal subsidies to Amtrak be terminated. Given competing demands for higher-priority programs, Amtrak must move toward self- sufficiency. The Administration also opposes the Committee's action to split Federal support to Amtrak into two appropriations. Separate appropriations are unnecessary and would mask the total cost to the taxpayer of intercity rail operations.

Northeast Corridor Improvement Program, and Local Rail Freight Assistance. The Administration objects to the $165 million provided for the Northeast Corridor Improvement Program and the $12 million provided for the Local Rail Freight Assistance Program in the Senate bill. These programs are unnecessary, and no funding was requested in the President's budget. There is no national need for or interest in the projects supported by these programs.

Section 511 Loan Guarantees. The Senate Committee provides $100 million in section 511 loan guarantee authority. Given the availability of private financing, providing new guarantees under this program is unnecessary. Past Department of Transportation appropriations acts have expressly prohibited new loan guarantees.

Office of the Secretary

Rent Payments. The Senate Committee bill provides a separate appropriation, funded at $107.7 million, to finance the Department of Transportation's rent payments. This is $11.8 million below the FY 1991 estimate of rent payments due to the General Services Administration. Funding rent payments through the modal administrations is preferable to funding in one appropriation, as provided by the Committee. The combination of the underfunding and the separate appropriation would prevent the Department from paying its Standard Level User Charge bill in 1991.

B. Language Provisions

Urban Mass Transportation Administration (UMTA)

Sec. 338: Phoenix. Arizona. Section 338 is a substantive provision which seeks to modify the Urban Mass Transportation Act (UMT Act) by allowing the City of Phoenix to enter into a labor agreement that could require future mass transit contractors to retain the labor force employed by previous contractors with the same rights and benefits that the labor force had previously acquired. This arrangement would inhibit private-sector participation in the provision of services and constrain free and open competition. Finally, this provision would extend transit employee protection safeguards beyond their original intent.

Limits on competition and private-sector participation would be in violation of the UMT Act competitive procurement and private sector requirements. The Act mandates compliance with these requirements before recipients are eligible for Federal operating and capital assistance.

Micromanagement Provisions

Federal Aviation Administration

Increase in Pay Demonstration Areas. The Senate Committee bill proposes increasing the number of areas included in FAA's pay demonstration project. This action is inappropriate and contrary to good management, and it would set a precedent for statutory designation of facilities for special pay treatment.

Upgrade of Facilities. The Senate Committee bill proposes upgrading the level of certain facilities in the New York area. FAA has established procedures for determining the appropriate level of air traffic facilities. The Senate Committee action impedes FAA administrative and managerial control and adversely affects recruitment efforts at the New York Terminal Radar Approach Control facility (TRACON).

Letter of Intent Approval. The Administration is concerned about a general provision requiring that all airport grant letters of intent greater than $10 million be submitted for approval to four Congressional Committees. In granting authority and making appropriations, the Congress, by law, may not reserve to its committees veto power over appropriations (See INS v. Chadha. 462 U.S. 919 (1983)). The Constitution provides that the President shall take care that the laws are faithfully executed. The Executive Branch routinely provides committee notification and the consultation that interbranch comity requires in matters in which Congress has indicated a special interest.

Urban Mass Transportation Administration (UMTA)

"Major Capital Investment Projects" Notice of Proposed Rulemaking (NPRM). The Administration objects to the prohibition on using UMTA funds to implement or enforce the "Major Capital Investment Projects" NPRM. Any concerns regarding the effects of the NPRM should be addressed through the regulatory process and not by blocking its implementation.

Office of the Secretary

The Senate limits to 120 the number of political and Presidential appointees in the Department of Transportation. The Administration objects to such limitations since they interfere with Executive Branch management discretion.