Statement of Administration Policy: H.R. 5006 - National Defense Authorization Act for Fiscal Year 1993

(House Rules)
(Aspin (D) WI and Dickinson (R) AL)

The Administration strongly opposes H.R. 5006, as reported by the Committee on Armed Services, because it fails to conform to the President's Budget and encumbers certain management initiatives. The Administration urges the House to amend the bill to make it consistent with the President's request.

H.R. 5006 would authorize fiscal year 1993 appropriations of $274.0 billion for national defense, $7 billion less than the President's request. Of particular concern, the bill would:

—   Authorize only $4.2 billion for the Strategic Defense Initiative (SDI), approximately $1.1 billion less than requested. This cut would undermine last year's landmark "Missile Defense Act of 1992" and delay initial deployment of strategic defenses. H.R. 5006 would also eliminate the entire $576 million request for space-based interceptor development, thus removing the global element of the President's proposal for ballistic missile defense. In addition, the bill's proposal to create a new organization for theater defenses, separate from the SDI Organization, would needlessly complicate the acquisition of missile defenses, while increasing overhead costs.

—   Reduce funding for Operation and Maintenance to $79.7 billion, $6.7 billion less than requested. A cut of this magnitude cannot be achieved by reducing supply purchases and overhead activities, as assumed in the Committee report, without harming troop readiness. The Department of Defense is reducing inventory levels and overhead costs. The proposed reductions would disrupt current operations, lead to low levels of needed supplies, and do nothing to help reduce the inventory of excess supplies.

In addition, the bill would authorize unrequested programs at the expense of high priority programs. Specifically, the bill would add:

—   $1.0 billion for economic conversion programs that are inappropriate for funding within the national defense category.

—   $755 million for three additional test aircraft for the unnecessary V-22 program, while imposing irrational reductions in the staff of the Department of Defense Comptroller.

—   $635 million for unrequested Guard and Reserve equipment, as well as authorize Guard and Reserve personnel levels that are 49,050 higher than those requested by the Administration.

—   $420 million for a replacement facility for Fitzsimons Army Medical Center, Denver, Colorado -- a community that is estimated to have an excess health care capacity of 40 percent, thus making a replacement facility unnecessary.

—   $150 million for flat panel displays and for X-ray lithography. These items would apparently be developed for commercial applications, even though private firms would do a better job of selecting and funding technologies to meet market demands.

—   Substantial health care benefits for Department of Defense health care beneficiaries. Any significant changes in health care benefits should be considered in the health care study required by the FY 1992 Defense Authorization Act.

Furthermore, H.R. 5006 contains other objectionable provisions that would either impede cost-saving initiatives or impose cumbersome requirements affecting departmental operations. The most troubling features would:

—   Fail to approve the Administration's National Defense Sealift Fund, which would establish a more effective mechanism for financing the acquisition of needed sealift.

—   Restructure and reorient development programs for the Navy's F/A-18E/F and AX tactical aircraft. The effect of Committee actions would be to raise costs unnecessarily and to delay the entry into service of these badly needed aircraft.

—   Prohibit the Secretary of Defense from entering into contracts or evaluating the potential savings offered by conversions to in-house or contract performance pursuant to an A-76 cost comparison decision.

—   Impose inappropriate and counterproductive Federal procurement requirements, such as requiring subcontracting plans as a significant evaluation factor of the same magnitude as cost and technical considerations in a contract solicitation.

—   Grant piecemeal exemptions from the current honoraria restrictions to faculty and students of certain Department of Defense schools.

—   Prohibit the obligation of funds for non-nuclear consolidation until the Secretary of Energy certifies to Congress that each of the thousands of components produced in government-owned contractor-operated facilities are cost-effective on a component-by-component basis. This unnecessarily detailed review and analysis would preclude the Department of Energy from proceeding with cost-saving non-nuclear consolidation.

The Administration also strongly objects to several provisions which raise constitutional concerns. Some of these provisions would infringe upon the President's authority to make recommendations to Congress, to conduct foreign affairs, and to act as Commander in chief.

As the review of H.R. 5006 continues, the Administration may propose additional amendments to the bill.

Scoring for the Purpose of PAYGO and Discretionary Caps

H.R. 5006 would increase direct spending; therefore, it would be subject to the pay-as-you-go requirement of the Omnibus Budget Reconciliation Act of 1990 (OBRA). No offsets to the direct spending increase are provided in the bill. A budget point of order applies in both the House and Senate against any bill that is not fully offset under CBO scoring. If, contrary to the Administration's recommendation, the House waives any such point of order that applies against H.R. 5006, the effects of enactment of this legislation would be included in the look back pay-as- you-go sequester report at the end of the Congressional session.

OMB's preliminary scoring estimates of this bill are presented in the table below. Final scoring of this legislation may deviate from these estimates. If H.R. 5006 is enacted, final OMB scoring estimates will be published within five days of enactment, as required by OBRA. The cumulative effects of all enacted legislation on direct spending will be issued in monthly reports transmitted to Congress.

Estimates For Pay-As-You-Go
(in millions)