Statement of Administration Policy: H.R. 4539 - Treasury Postal Service, and General Government Appropriations Bill, FY 1995

(House Floor)
(Sponsors: Obey (D), Wisconsin; Hoyer (D), Maryland)

This Statement of Administration Policy provides the Administration's views on H.R. 4539, the Treasury, Postal Service, and General Government Appropriations Bill, FY 1995, as reported by the House Appropriations Committee.

Tax System Modernization

The Administration strongly objects to the Committee's significant reduction in-funding for the Internal Revenue Service's (IRS's) Tax System Modernization (TSM) initiative, which is a Presidential priority investment item. The Committee's reduction would not only eliminate the increase requested in the FY 1995 Budget but would also cut deeply into the base funding for this program. This action would increase implementation costs in future years and significantly delay the program's major benefits, which include more timely responses to taxpayer inquiries, savings from increased productivity, and enhanced tax collections.

Specifically, if the Committee's reduction to TSM were enacted, IRS would be unable to award the contract for replacement of its tax processing center computers. Computer replacement is critical because enhanced automation serves as the foundation for modernization projects. The Committee's reduction would also defer the implementation of an automated system for IRS auditors. Productivity savings scheduled for FY 1996, therefore, would not occur, making it more difficult to stay within spending targets.

Modernizing the IRS is an Administration priority — it is critically important that we maintain an effective tax collection system. TSM enhancements are necessary to address major tax compliance issues and to improve services to taxpayers.

The Administration urges the Congress to adopt the fees proposed in the FY 1995 Budget, including the $94 million in U.S. Customs Service merchandise processing fees, and to shift funding from lower-priority items in this bill to ensure the appropriate funding for the TSM initiative. The Administration will work with the Congress to explore other options for funding TSM at an appropriate level.

IRS Tax Compliance Initiative

The Administration commends the Committee for funding the $405 million IRS Tax Compliance initiative. This initiative is expected to have deficit-reducing potential by generating additional revenue without raising taxes.

Federal Employee Pay Raise

The President's budget includes sufficient funds to provide a pay raise averaging 1.6 percent for both military personnel and Federal civilian employees. It is the Administration's preference to provide this 1.6 percent pay raise. However, if the 2.6 percent pay raise for military personnel currently provided for in the DOD authorization bill is approved, then the Administration does not object to a pay raise averaging 2.6 percent for civilian personnel, as contained in the Committee bill.

Additional Administration concerns with the Committee- reported bill are contained in the attachment.

Attachment

ADDITIONAL CONCERNS

H.R. 4539 — TREASURY, POSTAL SERVICE, AND GENERAL GOVERNMENT APPROPRIATIONS BILL, FY 1995

(AS REPORTED BY THE HOUSE APPROPRIATIONS COMMITTEE)

The Administration looks forward to working with the Congress to address the following concerns as the appropriations process progresses.

Department of the Treasury:

Unnecessary Earmarking. The Administration objects to proposed appropriations and report language in the Bureau of Alcohol, Tobacco and Firearms; the U.S. Customs Service; and the U.S. Secret Service that would earmark funds for specific activities. This proposed language would unnecessarily limit the Administration's ability to use constrained discretionary resources effectively to meet critical and changing needs.

General Services Administration (GSA):

Funding for the Acquisition of Federal Buildings. The Committee has not funded the $1 billion Federal building acquisition program within the proposed construction and acquisition account. This funding would allow the Federal government to convert from existing leases to an ownership position. The Administration is concerned that the Committee's action would prevent the Government from taking advantage of acquiring buildings and thereby lowering the cost of housing Federal agencies. Furthermore, the Committee has chosen to fund the construction portion of the construction and acquisition account out of the Federal Buildings Fund (an appropriation of $367 million and $231 million in balances) as opposed to creating a new account as proposed in the President's budget. The Administration urges the House to adopt the funding structure proposed in the President's budget.

Executive Office of the President:

Office of National Drug Control Policy (ONDCP). The Administration is concerned that the Committee has failed to provide the funding level requested by the President for drug treatment through the Special Forfeiture Fund. This deletion hinders the President's highest drug control priority and would result in denying treatment to those who would most benefit from it. The Administration will work with the Congress to restore funding for this purpose later in the process.

Other Independent Agencies:

Administrative Conference of the United States (ACUS). The Administration understands that an amendment may be offered to eliminate funding for ACUS. The Administration would oppose such an amendment. ACUS continues to provide invaluable assistance in streamlining regulatory bureaucracy and improving the fairness of administrative proceedings.

Advisory Commission on Intergovernmental Relations (ACIR). The Administration understands that an amendment may be offered to eliminate funding for ACIR. The Administration would oppose such an amendment. Through its analysis of intergovernmental behavior and recommendations on how Federal, State, and local governments may together serve the public more effectively. ACIR continues to provide a valuable service.

John F. Kennedy Assassination Records Review Board. On May 16, 1994, the Administration submitted an amendment to the FY 1995 Budget requesting $2.4 million in funding for the newly established John F. Kennedy Assassination Records Review Board. The Committee has not provided funding for the Board. The Administration urges the Congress to support funding for the Board.

Other Concerns:

Government-wide General Provisions: The Administration is opposed to Section 613, which is a barrier to cross-agency collaborations in the pursuit of solutions to problems. The Administration also has concerns about Section 617, which addresses blue-collar pay raises, and Section 630, which addresses uses for sick leave, as currently drafted. The Administration will work with the Congress to explore other options for addressing these issues.

Infringements on Executive Authority. There are several provisions in the Committee bill that require Congressional approval before Executive Branch execution of aspects of the bill. The Administration will interpret such provisos to require notification only, since any other interpretation would contradict the Supreme Court ruling in INS vs. Chadha.