Appropriations for FY2005: Transportation, Treasury, and Independent Agencies

CRS Report for Congress
Appropriations for FY2005:
Transportation, Treasury, and
Independent Agencies
Updated December 21, 2004
David Randall Peterman and John Frittelli
Coordinators
Resources, Science, and Industry Division

Congressional Research Service ˜ The Library of Congress

Appropriations are one part of a complex federal budget process that includes budget
resolutions, appropriations (regular, supplemental, and continuing) bills, rescissions, and
budget reconciliation bills. The process begins with the President’s budget request and is
bound by the rules of the House and Senate, the Congressional Budget and Impoundment
Control Act of 1974 (as amended), the Budget Enforcement Act of 1990, and current
program authorizations.
This report is a guide to one of the 13 regular appropriations bills that Congress considers
each year. It is designed to supplement the information provided by the Subcommittee on
Transportation, Treasury and Independent Agencies of the House Committee on
Appropriations the Subcommittee on Transportation, Treasury and General Government of
the Senate Committee on Appropriations. It summarizes the current legislative status of the
bill, its scope, major issues, funding levels, and related legislative activity. The report lists
the key CRS staff relevant to the issues covered and related CRS products.
This report is updated as soon as possible after major legislative developments, especially
following legislative action in the committees and on the floor of the House and Senate.
NOTE: A Web Version of this document with active links is
available to congressional staff at
[http://www.crs.gov/ products/ appropri ati ons/ apppage.sht m l ].

Appropriations for FY2005:
Transportation, Treasury, and Independent Agencies
Summary
The FY2005 Transportation, Treasury and Independent Agencies appropriations
bill was passed as Division H of P.L. 108-447, an omnibus appropriations bill, and
was signed into law on December 8, 2004. The bill provides $90.6 billion for
Transportation, Treasury, and Independent Agencies. However, the bill also includes
an across-the-board rescission of 0.80%, which will reduce the Transportation,
Treasury, and Independent Agencies funding by approximately $725 million. This
will make the final figure $89.9 billion, slightly less than FY2004’s $90.3 billion but
more than the Administration’s request for FY2005.
For FY2005, the Administration requested $88.9 billion for the Departments of
Transportation and the Treasury, the Executive Office of the President, and a variety
of independent agencies. This was $1.6 billion (1.7%) less than the amount enacted
for FY2004.
On September 22, 2004, the House of Representatives passed H.R. 5025, the
Transportation, Treasury, and Independent Agencies Appropriations Act, 2005. The
Committee on Appropriations had recommended $89.9 billion, an increase of $0.9
billion over the President’s request and $495 million below the FY2004 level.
During the House floor debate on the bill, sections of the bill appropriating funds for
unauthorized programs were struck. Since at the time of the floor debate the surface
transportation programs were not authorized for FY2005, the result was that funding
for federal highway, highway safety, and transit programs was eliminated, as was
funding for Amtrak and the Airport Improvement Program. In the end, the House cut
some $47 billion in transportation funding from the $89.9 billion bill reported by the
Committee. The appropriation subcommittee chairman assured members that this
funding would be restored in conference (for this reason, the tables in this bill do not
reflect these cuts). The House bill included several provisions similar to provisions
that were included in the FY2004 House bill and that proved controversial. These
included setting the FY2005 federal civilian pay increase at the same level the
Administration requested for the military (3.5% for FY2005), limits on the
outsourcing of government work, and loosening of sanctions on Cuba.
On September 15, 2004 the Senate Committee on Appropriations reported out
S. 2806, their FY2005 Transportation, Treasury and General Government
Appropriations bill. The Committee recommended $90.6 billion in funding and
included provisions aligning the FY2005 federal civilian pay increase with that of the
military and limiting outsourcing of government work. This full Senate never acted
on this bill.
The conferees dropped the provisions limiting outsourcing of government work
and relaxing restrictions on Cuba. Final passage of the bill was delayed to allow
Congress to delete a provision that would have given appropriators’ access to
individual tax return information. This report will not be updated.

Key Policy Staff
^{Area of E}^x^pertis^e^N^am^e^CRS^Dⁱ^vi^sⁱ^on^Telepho^ne
^Aⁱ^rport^Im^prov^em^en^t^Prog^ram^{Bob K}ⁱ^rk^J^o^{hn Fi}^sc^he^r^RSI^RSI^7-⁷⁷⁶⁹^7-⁷⁷⁶⁶
^A^m^t^r^ak^R^aⁿ^d^y^Pet^e^rm^an^R^S^I⁷^-³²⁶⁷
^A^vⁱ^a^tⁱ^oⁿ^S^a^f^e^t^y^Bart^Elⁱ^a^s^R^S^I^7-⁷⁷⁷¹
^C^o^m^p^etitiv^{e Sou}^r^cin^g^L^.^Elain^e^Halchⁱⁿ^G^&^F^7-⁰⁶⁴⁶
^E-^G^o^v^e^rn^m^eⁿ^t^H^a^rol^d^R^e^l^y^ea^G^&^F⁷^-⁸⁶⁷⁹
^Ex^ecu^tⁱ^v^{e O}^f^fⁱ^{ce of}^t^h^{e Pres}ⁱ^d^en^t^B^{arbara S}^c^h^w^em^l^e^G^&^F^7-⁸⁶⁵⁵
^F^e^deral^A^vⁱ^a^tⁱ^oⁿ^A^d^mⁱⁿⁱ^s^t^ratⁱ^oⁿ^J^ohⁿ^Fⁱ^s^c^h^e^r^R^S^I^7-⁷⁷⁶⁶
^F^e^deral^C^hⁱ^l^d^C^a^re^Melⁱⁿ^{da G}ⁱ^s^h^D^S^P⁷^-⁴⁶¹⁸
^F^e^deral^El^ectⁱ^oⁿ^C^o^m^mⁱ^s^sⁱ^on^Jos^e^ph^C^aⁿ^t^or^G^&^F⁷^-⁷⁸⁷⁶
^F^e^deral^Em^pl^oy^{ee H}^eal^t^h^C^a^{re Pol}ⁱ^c^y^H^eal^t^h^S^ectⁱ^oⁿ^D^S^P^7-⁵⁸⁶³
^F^e^deral^Em^pl^oy^{ee Pen}^sⁱ^oⁿ^Polⁱ^c^y^P^at^ri^ck^Pu^rcel^l^D^S^P^7-⁷⁵⁷¹
^F^e^deral^Em^pl^oy^{ee Work}^ers^’
^C^o^m^p^en^s^a^tⁱ^oⁿ^(F^EC^A⁾^Edw^a^{rd R}^a^ppaport^D^S^P^7-⁷⁷⁴⁰
^Fe^d^e^r^a^l^Hⁱ^ghw^a^y^A^d^mⁱⁿⁱ^st^r^a^tⁱ^oⁿ^{Bob K}ⁱ^rk^J^o^{hn Fi}^sc^he^r^RSI^RSI^7-⁷⁷⁶⁹^7-⁷⁷⁶⁶
^{Federal R}^a^{ilroad A}^d^mⁱⁿⁱ^s^t^ration^J^ohⁿ^Frittelli^R^S^I⁷^-⁷⁰³³
^F^e^deral^T^r^an^sⁱ^t^A^d^mⁱⁿⁱ^s^t^ratⁱ^oⁿ^R^an^dy^Pet^e^rm^an^R^S^I⁷^-³²⁶⁷
^G^eⁿ^e^ral^Provⁱ^sⁱ^oⁿ^s^{Barbara S}^c^h^w^em^l^e^G^&^F⁷^-⁸⁷⁸⁹
^G^eⁿ^e^ral^S^e^rvⁱ^ces^A^d^mⁱⁿⁱ^s^t^ratⁱ^oⁿ^S^t^e^ph^anⁱ^e^S^mⁱ^t^h^G^&^F⁷^-⁸⁶⁷⁴
^Hⁱ^g^h^w^ay^{, R}^aⁱ^l^r^{oad, &}^V^e^hⁱ^cu^l^a^{r S}^a^f^e^t^y^Pau^l^R^o^t^h^berg^R^S^I⁷^-⁷⁰¹²
^In^depen^d^en^t^A^g^en^ci^es^{Barbara S}^c^h^w^em^l^e^G^&^F⁷^-⁸⁶⁷⁷
^In^t^e^rn^al^R^e^v^eⁿ^u^e^S^e^rvⁱ^c^e^G^ary^G^u^en^t^h^er^G^&^F⁷^-⁷⁷⁴²
^N^a^tⁱ^oⁿ^a^l^A^r^chⁱ^v^es^H^a^rol^d^R^e^l^y^ea^G^&^F⁷^-⁸⁶⁷⁹
^O^f^fⁱ^{ce of}^G^o^v^e^rn^m^eⁿ^t^Et^hⁱ^cs^Mi^l^d^{red A}^m^er^G^&^F⁷^-⁸³⁰⁴
^O^f^fⁱ^{ce of}^Pers^onⁿ^e^l^Man^a^g^e^m^eⁿ^t^{Barbara S}^c^h^w^em^l^e^G^&^F⁷^-⁸⁶⁵⁵
^Pos^t^al^S^e^rvⁱ^c^e^N^y^e^S^t^ev^en^s^G^&^F^7-⁰²⁰⁸
^Presⁱ^d^en^tⁱ^a^l^S^a^l^a^ry^{Barbara S}^c^h^w^em^l^e^G^&^F⁷^-⁸⁶⁷⁷
^Procu^r^em^en^t^S^t^e^ph^anⁱ^e^S^mⁱ^t^h^G^&^F⁷^-⁸⁶⁷⁴
^R^{eal Es}^{tate B}^r^ok^erag^{e R}^e^g^u^l^ation^W^illiam^J^ack^s^oⁿ^G^&^F⁷⁷⁸³⁴
^Su^rf^{ace T}^r^an^s^portation^B^o^ard^J^ohⁿ^Frittelli^R^S^I⁷^-⁷⁰³³
^T^r^an^s^port^a^tⁱ^oⁿ^In^f^r^as^t^r^u^c^t^u^{re Pol}ⁱ^c^y^J^ohⁿ^Fⁱ^s^c^h^e^r^R^S^I^7-⁷⁷⁶⁶
^T^r^eas^u^r^y^D^e^part^m^eⁿ^t^G^a^ry^G^u^en^t^h^er^G^&^F⁷^-⁷⁷⁴²
^DSP^{= Do}^m^e^{stic So}^{cial P}^o^licy
^G^&^F=^G^o^ve^rⁿ^m^e^nt^{& Fi}^na^nc^e
^R^S^{I = R}^e^s^o^u^r^ces^{, Scien}^{ce, an}^{d In}^du^s^t^ry^Divⁱ^sⁱ^on^.

Contents
Most Recent Developments..........................................1
Overview ........................................................1
Legislative Status..............................................1
Data note................................................1
FY2004 Appropriations.........................................2
FY2005 Appropriations.........................................2
Major Funding Trends..........................................4
Title I: Transportation Appropriations..................................5
Overview ....................................................5
Federal Aviation Administration (FAA)............................7
Operations and Maintenance (O&M)..........................8
Facilities and Equipment (F&E)..............................8
Research, Engineering, and Development (RE&D)...............8
Essential Air Service (EAS)..................................9
Grants-in-Aid for Airports...................................9
Federal Highway Administration (FHWA).........................10
The Administration Request................................10
Federal Motor Carrier Safety Administration (FMCSA)...............11
Administrative and Operations Expenses......................12
Grants to States and Other Activities..........................12
National Highway Traffic Safety Administration (NHTSA)............13
Federal Railroad Administration (FRA)...........................14
Railroad Safety...........................................14
Next Generation High-Speed Rail R&D.......................15
Amtrak .................................................15
Federal Transit Administration (FTA).............................16
FTA Program Structure and Funding..........................17
Capital Investment Grants and Loans Program (Section 5309)..17
Urbanized Area Formula Program (Section 5307)...........17
Other Transit Programs................................18
Job Access and Reverse Commute Program................18
Maritime Administration (MARAD)..............................20
Research and Special Programs Administration (RSPA)..............21
Title II: Treasury Appropriations.....................................23
Department of the Treasury Budget and Key Policy Issues.............23
Internal Revenue Service (IRS)..............................29
Title III: Executive Office of the President and Funds Appropriated
to the President..............................................32
EOP Offices Funded Through Treasury and
General Government Appropriations........................35
Compensation of the President..............................35
White House Office (WHO)................................36
Homeland Security Council (HSC).......................36

House Repair and Restoration...........................37
Council of Economic Advisers (CEA)........................38
Office of Policy Development...............................39
National Security Council (NSC)............................40
Office of Administration (OA)..............................40
Chief Financial Officer (CFO)...........................41
Office of Management and Budget (OMB).....................42
Office of National Drug Control Policy (ONDCP)...............45
The Counterdrug Technology Assessment Center (CTAC)....46
Federal Drug Control Programs..............................48
Other Federal Drug Control Programs
(formerly The Special Forfeiture Fund)...............50
Unanticipated Needs......................................52
Special Assistance to the President (Office of the Vice President)...52
Official Residence of the Vice President.......................53
Merit Systems Protection Board (MSPB)......................53
Office of Personnel Management (OPM)......................54
Human Capital Performance Fund........................59
Office of Special Counsel (OSC).............................60
Title IV: Independent Agencies......................................61
Federal Election Commission (FEC)..........................62
Federal Labor Relations Authority (FLRA).....................62
General Services Administration (GSA).......................63
Federal Buildings Fund (FBF)...........................65
Electronic Government Fund (E-gov Fund)................66
National Archives and Records Administration (NARA)..........69
Merit Systems Protection Board (MSPB)......................70
Office of Personnel Management (OPM)......................71
Human Capital Performance Fund........................76
Office of Special Counsel (OSC).............................77
Postal Service............................................77
Title V: General Provisions.........................................80
Federal Personnel Issues.......................................83
General Schedule Pay.....................................83
Federal Wage System......................................85
Senior Executive Service Salaries............................85
Human Capital Performance Fund........................86
Members of Congress, Judges, and Other Officials..............86
President ................................................86
Cuba Sanctions...............................................87
Appendix 1: List of Transportation Acronyms..........................89
Appendix 2: The Transportation Appropriations Framework...............91^st
Transportation Equity Act for the 21 Century (TEA-21)..............91
Appendix 3: Transportation Budget Terminology........................93

List of Tables
Table 1. Status of FY2005 Departments of Transportation and
the Treasury and Independent Agencies Appropriations..............1
Table 2. Transportation/Treasury Appropriations, by Title, FY2004-FY2005...2
Table 3: Funding Trends for Transportation/Treasury Appropriations,
FY1999-FY2005 ............................................4
Table 4. Title I: Department of Transportation Appropriations..............6
Table 5. FTA Appropriation, FY2003-FY2005..........................19
Table 6. Title II: Department of the Treasury Appropriations...............23
Table 7. Title III: Executive Office of the President (EOP) and Funds
Appropriated to the President Appropriations.....................32
Table 8. Title IV: Independent Agencies Appropriations..................61
Table 9. General Services Administration Appropriations.................65
Table 10. Summary of Proposed Changes to Government-wide General
P rovi s i ons .................................................81

Appropriations for FY2005: Transportation,
Treasury, and Independent Agencies
Most Recent Developments
On December 8, 2004, the President signed H.R. 4818, the Consolidated
Appropriations Act, 2005 (P.L. 108-447). Congress approved the conference
committee report on H.R. 4818 (H.Rept. 108-792), which incorporated the
Transportation, Treasury, and Independent Agencies FY2005 Appropriations bill and
eight other appropriations bills, on November 20, 2004, but the bill was held for a
correcting resolution (H.Con.Res. 528, passed December 6, 2004) before being sent
to the President.
Overview
Legislative Status
Table 1. Status of FY2005 Departments of Transportation and
the Treasury and Independent Agencies Appropriations
^Subco^m^mⁱ^t^t^ee^Conference^Repo^rt
^Ma^r^k^u^p^Hou^s^e^Hou^s^e^Sena^t^e^Sena^t^e^Co^nf.^A^p^p^r^oval^Public
^Repo^rt^Pas^s^age^Repo^rt^Pas^s^age^Repo^rt^La^w
^H^o^use^S^ena^t^e^H^o^u^se^Sena^t^e
^11-^19-
^9-^8-⁰⁴^9-^22-⁰⁴^9-^15-⁰⁴⁰⁴^11-^20-^11-^20-
^7-^15-⁰⁴^9-^9-⁰⁴^H.R^e^p^t^.^397-¹²^S.Rep^t^.^—^H.R^e^p^t^.⁰⁴⁰⁴^108-⁴⁴⁷
^108-⁶⁷¹^108-³⁴²^108-^344-⁵¹^65-³⁰
⁷⁹²
Data note. Prior to FY2004, appropriations for the Department of
Transportation and the Department of the Treasury were in separate bills. Beginning
with the FY2004 budget, Congress began considering appropriations for the
Department of Transportation (DOT) and its related agencies, and the Department
of the Treasury, the Postal Service, the Executive Office of the President, and
General Government provisions, in a single appropriations bill. This change was a
result of the creation of a new federal department, the Department of Homeland
Security, and the reorganization of the subcommittee structure of the House and
Senate Committees on Appropriations, creating new subcommittees for Homeland
Security and combining the former Transportation and Treasury subcommittees into
one committee.

As part of the creation of the Department of Homeland Security (DHS), the
United States Coast Guard and the Transportation Security Administration were
transferred from the Department of Transportation to DHS. Also, the Bureau of
Alcohol, Tobacco, and Firearms, the Customs Service, and the United States Secret
Service were transferred from the Department of the Treasury to DHS, and the Office
of Homeland Security was transferred from the Executive Office of the President to
DHS. Budget numbers for years prior to FY2004 have been adjusted in light of these
changes to compare pre-FY2004 figures with FY2004 and later figures.
FY2004 Appropriations
The FY2004 Transportation, Treasury, and Independent Agencies Appropriation
was passed as part of the FY2004 Consolidated Appropriations Act (P.L. 108-199).
This Act included a 0.59% across-the-board rescission which applied to most
accounts in the Transportation and Treasury and General Government
appropriations.
FY2005 Appropriations
The Administration’s FY2005 budget request for the Departments of
Transportation and the Treasury, the Executive Office of the President, and Related
Agencies was $88.9 billion, $1.6 billion below the final comparable FY2004-enacted
figure. Table 2 shows the allocation of funding within the overall request.
Table 2. Transportation/Treasury Appropriations,
by Title, FY2004-FY2005
(millions of dollars)
^Fin^a^l^FY²⁰⁰⁵^FY²⁰⁰⁵^FY²⁰⁰⁵^Sena^t^e^FY²⁰⁰⁵
Title^FY²⁰⁰⁴^Request^Hou^s^e^C^o^mmi^t^t^e^Ena^c^t^e^d
^Ena^c^t^e^d*^**^e^***
^T^{itle I}^:^Dep^a^r^t^m^eⁿ^t^o^f
^T^r^an^sp^o^r^tatioⁿ $58,357 $58,431 $58,889 $59,459 $58,916
^T^{itle I}^I^:^Dep^a^r^t^m^eⁿ^t^o^f^th^e
^T^r^eas^u^r^y 11,100 11,610 11,248 11,184 11,248
^T^{itle III: Ex}^ecu^tiv^{e Of}^fⁱ^{ce of}^th^e
^P^r^es^iden^t 782 774 727 754 770
^T^{itle I}^V^{: I}ⁿ^d^e^p^eⁿ^d^en^{t A}^g^en^cies20,33219,49420,74419,55219,547
^T^{itle V: Gen}^e^r^a^{l P}^r^o^v^isioⁿ^s — (1,627)(147)(147)(125)
^To^t^a^l 90,313 88,905 89,853 90,451 90,576
^S^o^u^rce:^B^udg^e^t^ta^ble^pr^ov^ide^d^by^the^H^ous^e^C^o^m^m^itte^e^{on A}^ppr^opr^ia^tions^{. “}^T^ota^l^”^is^f^r^om^“^N^e^t^g^r^a^{nd tota}^l
^budg^e^t^a^r^y^r^e^s^our^c^e^s^”^line^{in budg}^e^t^ta^ble^a^{nd r}^e^f^l^e^c^t^s^s^c^or^e^k^e^e^p^ing^a^d^ju^st^m^eⁿ^t^s^.^T^o^ta^ls^m^a^y^{not a}^{dd due}^to
^r^ounding^a^{nd s}^c^or^e^k^e^e^p^ing^a^d^jus^t^m^e^nts^.
^Note:^In^the^FY²⁰⁰⁴^{bill the}^H^ous^e^{put the}^P^o^s^t^a^l^Se^rv^ic^e^{in a}^s^e^pa^ra^te^title^{; in FY}^{2005, the}^H^ous^e^is^f^o^llowⁱ^ng
^the^Se^na^te^pra^c^tic^e^of^putting^the^P^o^sta^l^Se^rv^ic^e^{into the}^“^I^nde^pe^nde^{nt A}^g^eⁿ^cⁱ^e^s^”^T^itle^.
^*^T^he^FY^{2004 O}^m^nibus^a^ppr^opr^ia^tions^bil^l^c^ontaⁱ^ne^{d a}ⁿ^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^{on of}^0.59%^{; tha}^t^r^e^s^c^is^sⁱ^on
ⁱ^s^ref^l^ect^edⁱⁿ^t^h^{ese f}ⁱ^gu^res.
^*^*^T^he^H^ous^e^c^u^{t a}^pprox^im^a^t^e^l^y^{$47 billion f}^r^om^T^itle^I^(T^ra^ns^porta^{tion) f}^unding^during^f^l^oor^de^ba^te^{. Sinc}^e^the
^s^ubc^om^m^itte^e^c^h^aⁱ^r^a^s^s^u^r^e^{d m}^e^m^b^e^r^s^tha^t^the^f^unding^w^ould^be^r^e^s^t^or^e^d^{in c}^onf^e^r^eⁿ^c^e^,^tha^t^c^u^{t is}^{not r}^e^f^l^e^c^t^e^d
^he^r^e^.

^***T^h^e^F^Y²⁰⁰⁵^O^m^nibus^a^ppropria^tions^{bill c}^ontaⁱ^ns^aⁿ^a^c^r^os^s^-^the^-^boa^{rd re}^s^c^is^sⁱ^{on of}^0.80%^{; tha}^t^re^s^c^is^sⁱ^on
ⁱ^sⁿ^o^t^ref^l^ect^edⁱⁿ^t^h^{ese f}ⁱ^gu^res.
The Administration submitted its FY2005 budget request to Congress on
February 2, 2004, two weeks after Congress completed the FY2004 appropriation
process by passing an omnibus appropriations bill (P.L. 108-447). The House
Committee on Appropriations marked up H.R. 5025, the FY2005 Transportation,
Treasury, and Independent Agencies appropriations bill, on July 23, 2004, but the bill
was not officially reported out by the Committee until September 9, 2004 (H.Rept.
108-671). The Committee recommended $89.9 billion. The House of
Representatives passed H.R. 5025 on September 22, 2004. During floor debate, the
House cut some $47 billion in transportation funding from the $89.9 billion bill, as
points of order were raised against appropriations to programs lacking authorizing
legislation. Since, at that point, surface transportation programs had no authorizing
legislation for FY2005, virtually all appropriations for highway and transit programs
were eliminated; funding for Airport Improvement Program grants was eliminated
as well. However, the Appropriations subcommittee chair assured members the
funding would be restored in conference.
The Senate Committee on Appropriations reported out S. 2806 (S.Rept. 108-
342), their FY2005 Transportation, Treasury and General Government
Appropriations bill, on September 15, 2004. The Committee recommended $90.5
billion, $1.6 billion more than the Administration request. This bill was never taken
up by the full Senate.
Fiscal Year 2005 began with the FY2005 transportation-treasury appropriations
bill, and most of the other annual appropriations bills for FY2005, unfinished.
Congress passed a series of continuing resolutions to fund the government as
negotiations on the appropriations bills continued. Appropriators ultimately
combined 9 of the bills into an omnibus (H.R. 4818). On November 20, 2004, the
House and Senate passed the conference report for H.R. 4818 (H.Rept. 108-792), one
day after its completion. However, controversy arose over a provision inserted into
Division H of the bill, the FY2005 Transportation, Treasury, and Independent
Agencies Appropriations Act, during conference. The provision, intended to aid
oversight over the Internal Revenue Service, would have given appropriators and
their staff access to the tax returns of individuals and corporations, while shielding
them from any penalties for disclosing information from those returns. The Senate
objected to the provision, a resolution was drafted ordering the clerk to remove the
provision, and the resolution was approved on December 6, 2004. The bill was then
sent to the President, and was signed into law on December 8, 2004. The bill
provides $90.6 billion for the Departments of Transportation and the Treasury, and
the independent agencies included in Division H, minus a 0.80% across-the-board
rescission which applies to the entire omnibus. Official numbers reflecting the
rescission are not available, so the numbers in this report do not reflect the rescission,
but unofficially the rescission will reduce the Transportation-Treasury appropriation
to $89.9 billion, approximately $460 million below the amount provided for FY2004
but approximately $950 million above the Administration request for FY2005.

Major Funding Trends
Table 3 shows funding trends for Transportation/Treasury Appropriations from
FY1999 through FY2004.
Table 3: Funding Trends for Transportation/Treasury
Appropriations, FY1999-FY2005
(billions of current dollars)
^D^e^p^a^rtm^eⁿ^t^FY¹⁹⁹⁹^FY²⁰⁰⁰^FY²⁰⁰¹^d^FY²⁰⁰²^FY²⁰⁰³^e^FY²⁰⁰⁴^f^FY²⁰⁰⁵^g
^T^{itle I}^:^T^r^an^sp^o^r^tatioⁿ^a^$43.9^$46.2^$51.9^$57.4^$55.7^$58.4^$58.9
^T^{itle I}^I^:^T^r^easu^r^y^b^9.0⁹^.0^9.9^10.5^10.8^11.1^11.2
^T^{itle III: Ex}^ecu^tiv^e^0.7⁰^.7^0.7⁰^.8^0.8⁰^.8^0.8
^Of^fⁱ^{ce of}^th^{e P}^r^es^iden^t
^T^{itle I}^V^{: I}ⁿ^d^e^p^eⁿ^d^en^t^c^14.7^15.1^15.9^16.9^19.3^20.3^19.5
^A^g^en^cies
^S^o^u^rce:^Unⁱ^t^e^d^S^t^at^{es Ho}^u^s^{e o}^f^Rep^r^esen^t^a^tⁱ^v^e^s^,^C^o^mmi^t^t^{ee o}ⁿ^A^p^p^r^o^p^rⁱ^a^tⁱ^oⁿ^s^,^Co^m^p^aratⁱ^v^{e S}^t^at^em^en^t^o^f
^B^udg^e^t^A^u^thor^ity^ta^ble^s^f^r^om^fⁱ^s^c^a^l^y^e^a^r^s^{1999 thr}^oug^{h 2004.}
^a^.^Fig^u^r^e^s^f^o^r^D^e^pa^r^t^m^e^{nt of}^T^r^aⁿ^s^por^ta^tioⁿ^ap^p^r^o^p^r^ia^tions^f^o^r^FY^1999-^FY^{2003 ha}^v^e^be^eⁿ^a^d^jus^t^e^d^f^o^r
^c^o^m^p^a^r^is^{on w}^{ith FY}^{2004 f}ⁱ^g^u^r^e^s^b^y^su^btr^a^c^ting^the^Uⁿ^ite^{d Sta}^t^e^s^C^o^a^s^{t G}^u^a^r^{d, the}^T^r^aⁿ^s^por^ta^tion
^S^ecu^ri^t^y^A^d^mⁱⁿⁱ^st^ratⁱ^oⁿ^,^t^h^{e Nat}ⁱ^oⁿ^a^l^T^r^an^sp^o^r^t^a^tⁱ^oⁿ^S^a^fe^t^y^Bo^ard^,^an^d^t^h^{e A}^r^chⁱ^t^ect^u^r^al^an^d
^T^r^aⁿ^sporta^{tion Ba}^rrie^r^{s Com}^p^lia^nc^e^Boa^r^{d, a}^{nd by}^a^dding^the^Ma^ritim^e^A^d^mⁱ^nistra^tion.
^{b. Fig}^u^r^e^s^f^o^r^D^e^pa^r^t^m^e^{nt of}^the^T^r^e^a^s^ur^y^a^ppr^opr^ia^tions^f^o^r^FY^1999-^FY²⁰³^ha^v^e^be^eⁿ^a^d^jus^t^e^d^f^o^r^c^o^m^p^a^r^is^on
^w^{ith FY}^{2004 f}ⁱ^g^u^r^e^s^by^s^ubtr^a^c^ting^the^B^u^r^e^a^u^of^A^l^c^ohol,^T^ob^acco^,^an^d^Fⁱ^rearm^s^;^t^h^{e Cu}^st^o^m^s^S^e^rvi^ce;
^t^h^{e Un}ⁱ^t^e^d^S^t^at^{es S}^ecret^S^e^rvi^ce;^an^d^t^h^{e L}^a^w^Eⁿ^f^o^rcem^en^t^T^r^aiⁿⁱⁿ^g^Cen^t^er.
^c^.^Fig^u^r^e^s^f^o^r^R^e^la^te^{d A}^g^eⁿ^cⁱ^e^s^a^ppr^opr^ia^tions^f^o^r^FY^1999-^FY^{2003 ha}^v^e^be^eⁿ^a^d^jus^t^e^d^by^a^dding^the^N^a^tiona^l
^T^r^aⁿ^s^por^ta^{tion Sa}^f^e^ty^B^o^a^r^d,^the^A^r^c^h^ite^c^t^ur^a^l^a^{nd T}^r^aⁿ^s^por^ta^{tion B}^a^r^rⁱ^e^r^s^C^o^m^p^lia^nc^e^B^o^a^r^{d, a}^{nd the}
^P^o^st^al^S^e^rvi^ce.
^{d. FY}^{2001 f}ⁱ^g^u^r^e^s^r^e^f^l^e^c^t^0.22%^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^on.
^e^.^FY^{2003 f}ⁱ^g^u^r^e^s^r^e^f^l^e^c^t^0.65%^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^on.
^f^.^FY^{2004 f}ⁱ^g^u^r^e^s^r^e^f^l^e^c^t^0.59%^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^on.
^g^.^FY^{2005 f}ⁱ^g^u^r^e^s^{do not r}^e^f^l^e^c^t^0.80%^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^on.

Title I: Transportation Appropriations
Overview
The Administration’s FY2005 budget proposed a DOT budget of $58.4 billion
— similar to FY2004’s enacted level of $58.4 billion (see Table 4).¹ The budget^st
request conforms to the basic outline of the Transportation Equity Act for the 21
Century (TEA-21; P.L. 105-178) which authorizes spending on highways and transit,
and which the 108^th Congress is in the process of reauthorizing. (See Appendix 2 for
more information on this authorizing act.) However, the request did propose a few
changes to the highway and transit funding structure, in line with the
Administration’s reauthorization proposal; see the sections on the Federal Highway
Administration and Federal Transit Administration for details.
The House Committee on Appropriations recommended $58.9 billion for DOT
for FY2005, $559 million above FY2004 and $457 million above the Administration
request. The major change from the Administration request was an additional $900
million for federal highways and an additional $52 million for the Essential Air
Service program, as well as a provision blocking implementation of a pilot program
that would require communities to provide a local match for Essential Air Service
funds.
During floor debate, appropriators struck funding for transportation programs
that were not authorized for FY2005. This included the federal highway program,
federal highway safety programs, the federal transit program, and Amtrak. In
addition, the Airport Improvement Program was struck, as was Essential Air Service.
These cuts totaled approximately $47 billion of the $58.9 billion recommended for
transportation by the Committee on Appropriations. The transportation appropriation
subcommittee chair assured members that the cuts would be restored in conference.²
The Senate Committee on Appropriations recommended $59.5 billion for DOT
for FY2005, $1.2 billion more than the Administration request. The major changes
from the Administration request were an additional $890 million for federal
highways, an additional $492 million for transit, and an additional $317 million for
Amtrak. The bill was never taken up by the full Senate.
House and Senate conferees agreed on $58.9 billion for DOT for FY2005, $559
million above FY2004 and $485 million above the Administration request (though
after the 0.80% rescission is applied, the final FY2005 figure will be reduced by

¹ This report relies on figures from tables provided by the House and Senate Committees on
Appropriations. Because of differing treatment of offsets, rescissions, and the structure of
appropriations bills, the totals will, at times, vary from those provided by the
Administration. The FY2004 and later total budget numbers for DOT are not directly
comparable to those of previous years due to the transfer of the Coast Guard and
Transportation Security Administration to the Department of Homeland Security during
FY2003, as well as other changes.
² Honorable Ernest J. Istook, Jr., Congressional Record, vol. 150, no. 109 (daily ed.,
September 14, 2004), H7127.

around $470 million). The major changes from the Administration request were an
additional $442 million for transit, an additional $316 million for highways, an
additional $317 million for Amtrak, and a $322 million cut in Federal Aviation
Administration funding for air safety inspectors and air traffic controllers.
Table 4. Title I: Department of Transportation Appropriations
(in millions of dollars — totals may not add)
^Departm^e^{nt or Agency}^FY²⁰⁰⁴^a^FY²⁰⁰⁵^FY²⁰⁰⁵^FY²⁰⁰⁵^Sena^t^e^FY²⁰⁰⁵^b
^{(Selected Accounts}⁾^Ena^c^t^e^d^Request^Hou^s^e*^C^o^mmi^t^t^e^e^Ena^c^t^e^d.
^O^f^fⁱ^{ce of}^t^h^{e S}^ecret^ary^of^T^r^an^s^port^a^tⁱ^oⁿ^$165^$336^$164^$166^$240
^E^sseⁿ^tia^{l A}ⁱ^{r S}^e^rv^ic^e^c⁵²⁵⁰⁵²⁵²⁵²
^Fed^e^r^a^{l A}^v^iatioⁿ^A^d^mⁱⁿⁱ^str^a^tioⁿ⁽^F^A^A⁾^13,850^13,966^14,021^13,548^13,631
^O^p^er^atⁱ^ons⁽^t^r^u^s^t^f^{und &}^gener^a^l^f^und)^7,486^7,849^7,726^7,784^7,775
^Facilities^&^{Equipment (}^F^&^E⁾⁽^t^r^u^s^t^fund)^2,863^2,500^2,500^2,450^2,540
^G^r^ant^-i^n-ai^{d Ai}^r^por^t^s⁽^A^IP)⁽^t^r^u^s^t^f^und)
⁽^lⁱ^mⁱ^t^.^{on obl}ⁱ^g^.)^3,382^3,500^3,728^3,235^3,235
^Res^e^ar^{ch, Engineer}^{ing &}^Development
⁽^t^r^u^s^t^f^und)¹¹⁹¹¹⁷¹¹⁷¹²⁹¹³¹
^F^e^deral^Hⁱ^g^h^w^ay^A^d^mⁱⁿⁱ^s^t^ratⁱ^oⁿ^(F^H^A⁾^34,545^34,178^35,090^35,435^34,861
⁽^Lⁱ^mⁱ^t^a^tⁱ^{on on O}^b^lⁱ^gatⁱ^ons⁾^33,643^33,643^34,641^34,900^34,641
⁽^E^xem^pt^O^b^lⁱ^gatⁱ^ons⁾⁹³¹⁸³⁵⁸³⁵⁸³⁵⁸³⁵
^Addi^tⁱ^onal^f^unds
⁽^t^r^u^s^t^f^und)^—^—^—^—^—
^Addi^tⁱ^onal^f^unds
⁽^g^ener^al^f^und)¹⁷⁷^—^—¹⁰⁰⁸⁵⁵
^F^e^deral^Mot^o^{r C}^a^rri^{er S}^a^f^e^t^y^A^d^mⁱⁿⁱ^s^t^ratⁱ^oⁿ
^(F^MC^S^A⁾³⁶⁴⁴⁵⁵⁴³⁸⁴⁵⁰⁴⁴⁸
^Natioⁿ^a^{l Hig}^h^w^ay^T^r^af^fⁱ^{c Saf}^e^ty^A^d^mⁱⁿⁱ^str^a^tioⁿ^d
^(NHT^SA⁾⁴⁴⁸⁶⁸⁹⁴⁴⁸⁴⁵³⁴⁵⁸
^F^e^deral^R^aⁱ^l^r^{oad A}^d^mⁱⁿⁱ^s^t^ra^tⁱ^oⁿ¹^,447^1,088^1,082^1,437^1,443
^Amtr^ak^d^1,218⁹⁰⁰⁹⁰⁰^1,217^1,217
^F^e^deral^T^r^an^sⁱ^t^A^d^mⁱⁿⁱ^s^t^ratⁱ^oⁿ^(F^R^A⁾⁷^,266^7,266^7,249^7,758^7,708
^For^m^ul^{a G}^r^ant^s
⁽^g^ener^al^f^und)⁷⁶³^—⁷⁶⁸⁵¹³⁵⁰⁴
^For^m^ul^{a G}^r^ant^s⁽^t^r^u^s^t^f^und)^3,053^5,623^3,271^3,494^3,528
^C^api^t^a^l^Inves^t^m^ent^G^r^ant^s^.⁽^g^ener^al^f^und)⁶²⁴^1,234³⁴³⁴³⁷⁴¹⁷
^C^api^t^a^l^Inves^t^m^ent^G^r^ant^s⁽^t^r^u^s^t^f^und)^2,495³²⁹^2,510^2,977^2,921
^{St. L}^a^w^r^en^{ce Seaw}^ay^Dev^e^lopm^en^{t C}^o^rporation¹⁴¹⁶¹⁶¹⁶¹⁶
^Mar^itim^{e A}^d^mⁱⁿⁱ^str^a^tioⁿ⁽^M^A^R^A^D⁾²²¹²³⁴²²⁷³⁸⁴³⁰⁸
^R^e^s^earch^an^{d Special P}^r^og^ram^s^A^d^mⁱⁿⁱ^s^t^ration^e
^(R^S^P^A⁾¹¹²¹²³¹¹⁵¹²⁰¹¹⁷
^Of^fⁱ^{ce of}^In^s^p^{ector Gen}^e^ral⁵⁶⁵⁹⁵⁸⁵⁹⁵⁹
^Su^rf^{ace T}^r^an^s^portation^B^o^ard¹⁸¹⁹²⁰²⁰²⁰
^T^o^tal^,^D^e^p^a^rtm^eⁿ^t^{of T}^r^an^s^p^ortati^on^f^58,357^58,431^58,889^59,459^58,916

^Note:^Fig^u^re^s^a^r^e^f^r^om^a^budg^e^t^a^u^thority^ta^ble^prov^id^e^d^by^the^H^ous^e^Com^m^itte^e^{on A}^ppropria^tions^,^e^x^c^e^p^t
^Se^na^te^fⁱ^g^u^r^e^s^a^r^e^f^r^om^the^budg^e^t^a^u^thor^ity^ta^ble^{in S.R}^e^{pt. 108-}^{342. B}^ecau^se^o^f^dⁱ^f^f^e^riⁿ^g^t^r^eat^m^eⁿ^t^o^f^o^f^f^s^et^s,
^the^tota^{ls w}^{ill not a}^l^w^a^y^s^m^a^tc^{h the}^A^d^mⁱ^nistra^tion’s^tota^ls^{. T}^h^e^fⁱ^g^u^re^{s w}^{ithin this ta}^ble^m^a^y^dif^f^e^r^slig^htly^f^r^om
^thos^eⁱⁿ^the^te^x^t^due^{to s}^upple^m^eⁿ^ta^{l a}^ppr^opr^ia^tions^,^r^e^s^c^is^sⁱ^ons^,^a^{nd othe}^r^f^unding^a^c^tions^{. C}^o^lumⁿ^s^m^a^y^not
^a^{dd due}^{to r}^ounding^or^e^x^c^l^us^{ion of}^s^m^a^lle^r^pr^og^r^a^m^line^-^ite^m^s^.
^*^B^ecau^{se t}^h^{e t}^r^an^sp^o^r^t^a^tⁱ^oⁿ^ap^p^r^o^p^rⁱ^a^tⁱ^oⁿ^s^su^b^c^o^m^mⁱ^t^t^{ee ch}^ai^rm^an^assu^red^M^e^m^b^{ers t}^h^at^t^h^{e cu}^t^s^m^a^d^e^t^o
^tr^aⁿ^s^por^ta^{tion pr}^og^r^a^m^s^{on the}^f^l^oor^w^{ould be}^r^e^s^t^or^e^d^{in c}^onf^e^r^eⁿ^c^e^,^this^ta^ble^s^how^s^the^fⁱ^g^u^r^e^s^r^e^c^o^m^m^e^nde^d
^by^the^C^o^m^m^itte^e^{on A}^ppr^opr^ia^tions^.
^a^.^T^h^e^s^e^fⁱ^g^u^r^e^s^r^e^f^l^e^c^t^the^0.59%^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^{on inc}^l^ude^{d in P}^.^L^.^108-^199.
^{b. T}^h^e^s^e^fⁱ^g^u^r^e^s^{do not r}^e^f^l^e^c^t^the^0.80%^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^{on in P}^.^L^.^108-^447.
^c^.^T^h^e^s^e^a^m^ounts^a^r^e^{in a}^ddition^to^the^{$50 m}^{illion a}^nnua^{l a}^u^thoriz^a^{tion f}^o^{r the}^Es^s^e^ntia^{l A}ⁱ^{r Se}^rv^ic^e^prog^ra^m^;
^thus^{, the}^tota^{l FY}^{2004 a}^{nd FY}^{2005 f}^unding^w^{ould be}^{$102 m}^{illion ($50}^m^{illion +}^{$52 m}^illion).
^d.^In^a^{ddition to A}^m^tra^k^’s^FY^{2004 a}^ppropria^tion,^Cong^re^s^s^pos^tpone^{d A}^m^tra^k^’s^re^pa^y^m^eⁿ^{t of}^a^{$100 m}^illion
^loaⁿ^f^r^om^the^D^O^T^{. For}^FY^{2005, C}^ong^r^e^s^s^r^e^quir^e^{d A}^m^tr^a^k^to^r^e^pa^y^20%^of^the^loaⁿ^dur^ing^FY^2005.
^e^.^T^h^e^fⁱ^g^u^re^s^{do not re}^f^l^e^c^t^{$14 m}^{illion in pe}^rm^aⁿ^eⁿ^t^a^ppropria^tions^.^T^h^e^r^e^f^ore^,^the^tota^l^re^s^ourc^e^s^f^o^{r RSP}^A
^f^o^{r FY}^{2004 m}^a^y^be^s^e^eⁿ^a^s^{$126 m}^{illion a}^{nd f}^o^{r FY}^{2005 $131 m}^illion.
^f^.^R^e^s^c^is^sⁱ^ons^of^unoblig^a^t^e^d^pr^e^v^ious^y^e^a^r^s^’^c^ontr^a^c^t^a^u^thor^ity^ha^v^e^be^eⁿ^s^ubtr^a^c^t^e^d^f^r^om^this^tota^l.^B^ecau^se
^r^e^s^c^is^sⁱ^ons^of^pr^ior^y^e^a^r^s^’^c^ontr^a^c^t^a^u^thor^ity^ha^v^e^{no im}^pa^c^t^{on the}^budg^e^t^a^r^y^r^e^s^our^c^e^s^a^v^a^ila^ble^f^o^r^the
^c^u^rre^{nt f}ⁱ^s^c^a^l^y^e^a^r^{, the}^tota^{l re}^s^ourc^e^s^a^v^a^ila^ble^c^{ould be}^s^e^eⁿ^a^s^{$59.0 billion f}^o^{r FY}^{2004 e}ⁿ^a^c^t^e^d^.
Federal Aviation Administration (FAA)
[ h ttp://www.faa.gov/]
The Conference Report for FY2005 provides the FAA with $13.83 billion. This
is slightly less than the Bush Administration request for FY2005 which was $13.96
billion. The conference version of the appropriations bill is very close to the FY2004
level of funding of $13.88 billion. The proposal is essentially devoid of major new
initiatives, but contains some program adjustments and shifts a significant amount
of funding, $393 million, from the Facilities and Equipment (F&E) program to the
Operations and Maintenance (O&M) program.
The House proposal for total FAA funding was $14.3 billion, not including a
rescission of $758 million of prior year funds. Depending upon how this rescission
is treated, the House number was slightly above, or slightly below, the
Administration request. The bill provided for a General Fund contribution to O&M
programs of $1.7 billion, which was slightly below the Administration’s request for
this source of funding but was well below the FY2004 level. During floor debate the
General Fund contribution level was amended to a level of approximately $2.7
billion and the trust fund contribution was reduced accordingly.
The Senate Committee on Appropriations proposed an overall FAA funding
level of $13.9 billion, which is roughly the same level as the Administration request
(the bill included a rescission of $265 million). The bill proposed no major
programmatic changes or initiatives. The bill accepted the Administration’s
recommendation to reduce F&E funding and increase O&M funding accordingly.
The General Fund contribution to O&M was set at slightly more than $2.5 billion.
The vast majority of FAA funding is provided from the Airport and Airway
Trust Fund. Only O&M funding uses a mix of trust fund and Treasury general fund
monies. In FY2002 a Treasury general fund contribution of $1.1 billion was
provided for O&M funding. While the general fund contribution for FY2002 was on
the low side historically, the FY2003 amount returned to a higher contribution level
of $3.4 billion. The FY2004 Act raised the general fund contribution to $4.5 billion.

The FY2005 bill, however, reduces the general fund contribution to $2.8 billion
which is more in line with the historical contribution level. Historically, this funding
split has been an important part of the annual FAA budget debate. The rationale
behind the general fund contribution has been that the public at large realizes some
benefit from aviation whether it uses the system or not.³
Operations and Maintenance (O&M). For FY2005, the Administration
proposed $7.8 billion in total spending. This compares with a spending level of $7.5
billion in the FY2004 Act. The majority of funding in this category is for the salaries
of FAA personnel engaged in air traffic control, certification, and safety-related
activities. Much of the increased funding called for in the FY2005 request is for
increased air traffic control system costs and safety-related activities. The House bill
included $7.7 billion for this function, while the Senate bill contained almost $7.8
billion. The Conference bill at $7.71 billion is more in line with the House bill.
One issue getting attention in this year’s appropriations bills is the question of
hiring additional air traffic controllers. There is concern that many of the current
controllers, who were hired after the air traffic controllers strike of 1981, are now
rapidly approaching retirement age. Controller union representatives contend that the
FAA is not taking sufficient action to mitigate against potential future staff shortages.
The House bill tries to remedy this situation by providing an additional $9 million to
hire and train new controllers, and an additional $4 million to hire and train new
controller supervisors. The Senate bill also addresses this issue and provides an
additional $10 million to hire and train new controllers. The Conference report
includes provisions that accommodate new hiring and training, especially for
supervisors.
Facilities and Equipment (F&E). The Administration request for F&E was
$2.5 billion, $393 million below the FY2004 enacted figure. F&E funding is used
primarily for capital investment in air traffic control and safety. The Bush
Administration request would provide less for some safety and capacity technology
and hardware replacement initiatives than in FY2004. This is potentially the most
controversial aspect of the Administration’s FAA proposal. Both the House and
Senate bills, however, adopted the Administration’s requested level of $2.5 billion
and the Conference Report does the same.
Research, Engineering, and Development (RE&D). Under the
Administration proposal this program would have been subject to a small cut, to
$117 million from the $119.4 million in the FY2004 Act. Most RE&D activity is
focused on safety/air traffic control activities. No significant new initiatives were
proposed in the Bush Administration FAA budget. The House bill accepts the
Administration’s requested level, but makes some changes in the research projects
to be carried out during FY2005. The Senate bill also makes some project changes

³ General fund appropriations have varied substantially, both in dollar terms and as a
percentage of FAA appropriations as a whole, from year to year. Over the last 12 years the
share has ranged from 0% to 47%. See table 1 in CRS Report RS20177, Airport and Airway^th
Trust Fund Issues in the 106 Congress, by John W. Fischer.

and increases overall funding for RE&D to $129.4 million. The Conference bill at
$129.9 million is slightly more generous than any of the bills discussed above.
Essential Air Service (EAS). The EAS program is operated through the
Office of the Secretary of Transportation (OST), and receives its funding from
designated user fees collected from overflights of United States territory by foreign
aircraft. EAS has had an annual authorized funding level of $50 million for the last
several years. The overflight funding mechanism, however, has never provided this
much annual funding, so additional funding has been provided from other sources.
The EAS program continues to enjoy significant support in Congress.
The FY2004 Act provided $102 million for EAS, $50 million from its regular
authorization and $52 million in additional funds from the aviation trust fund. The
act does not, however, rely on the overflight fee as its principal funding mechanism.
During the FY2004 debate Congress rejected the Bush Administration’s calls to
reduce the size of the EAS program by half and require a local contribution at each
airport receiving EAS service.
In its FY2005 request, the Administration was once again proposing that the
size of the EAS program be reduced, capping the program at the $50 million level.
The Administration was also proposing that there be a local contribution.
In its bill, the House Committee on Appropriations rejected the Administration’s
proposal. Instead, it provided $101.7 million for FY2005. Of this amount, $51.7
million was made available from the airport and airway trust fund, with $14 million
to come from prior year carry over funds, and the remaining $36 million to come
from other funds available to the FAA. This is essentially the same level of funding
as that provided in FY2004. The House bill also includes a provision that prohibits
implementation of the local participation program (Title V, Section 525). During
floor consideration the $51.7 million to be made available from the trust fund was
removed on a point of order. Committee leadership expected that these funds would
be restored in Conference.
The Senate Committee on Appropriations also rejected the Administration’s
funding request. The Committee allowed $102 million in total EAS spending for
FY2005. Of this total $52 million was a direct appropriation and $50 million was
from overflight fees. The Committee did not specifically reject the local participation
program, rather it chose not to allow for its funding. The Conference bill accepts the
Senate funding arrangement and precludes the Administration from pursuing the
local match provision.
Grants-in-Aid for Airports. The Airport Improvement Program (AIP)
provides grants for airport development and planning. The Bush Administration
FY2005 budget proposal requested $3.5 billion for AIP, roughly $100 million more
than the FY2004 enacted level. The proposal would continue the prohibition of the
use of AIP grants to replace baggage conveyor systems, reconfiguration of terminal
baggage area or other airport improvements to accommodate bulk explosive
detection systems (EDS).

The FY2005 Consolidated Appropriations Act (P.L. 108-447) provides an
obligation limitation of $3.5 billion for AIP (the 0.80% across-the-board rescission
would reduce this to roughly $3.47 billion). The rescission makes this total slightly
less than the President’s request and roughly $90 million above the FY2004 enacted
level. The Act rescinds $265 million of F&E contract authority from FY2004, which
would have been transferred to AIP. This rescission, however, has no programmatic
impact on the FY2005 grants-in-aid for airports program. Like the House and Senate
bills, the Act provides $68.8 million for administration and continues the prohibition
on the use of AIP funds for airport improvements made to accommodate the
installation of EDS equipment, as well as setting aside $20 million for the Small
Community Air Service Pilot program. The conference report names 140 airports
and directs FAA to provide not less than the listed funding level for projects at these
airports. The conferees also agreed that state AIP apportionment funds to small
airports could be used as discretionary funds for the purpose of implementing
earmarks.
Federal Highway Administration (FHWA)
[ h ttp://www.fhwa.dot.gov]
The FHWA budget provides funding for the Federal-Aid Highway Program
(FAHP), which is the umbrella term for nearly all the highway programs of the
agency.
There are several sets of highway programs within FHWA. Most of the funding
is reserved for the major federal-aid highway programs, which can be thought of as
the core programs. These programs are: National Highway System (NHS), Interstate
Maintenance (IM), Surface Transportation Program (STP), Bridge Replacement and
Rehabilitation (BRR), and Congestion Mitigation and Air Quality Improvement
(CMAQ). All of these programs are subject to apportionment on an annual basis by
formula and are not subject to program-by-program appropriation.
There is a second category of highway funding. This so called “exempt”
category consists mostly of two elements: an additional annual authorization of
minimum guarantee funding ($639 million per fiscal year) and emergency relief
($100 million per fiscal year). These funds are not subject to the annual limitation
on obligations.
There is a further set of programs, known as the “allocated” programs (also
referred to as discretionary programs). These programs are under the direct control
of FHWA or other governmental entities. These programs include the Federal Lands
Highway Program, High Priority Projects (former demonstration project category),
Appalachian Development Highway System roads, the National Corridor Planning
and Border Infrastructure Program, and several other small programs. In recent
years, nearly all discretionary program funding has been earmarked by Congress.
The Administration Request. TEA-21 had not yet been reauthorized when
the President’s budget was released; the President’s FY2005 budget assumed that the
FY2005 authorization would conform to the President’s surface transportation
reauthorization recommendations. However, because, when the FY2005

Consolidated Appropriations Act was enacted, surface transportation programs had
not been reauthorized, the Consolidated Act retained the TEA21 program structure.
For FY2005, the President requested $34.18 billion for FHWA. This
represented a decrease of $367 million from the FY2004 enacted appropriation of
$34.55 billion.⁴ The proposed obligation limitation, which supports most of the
FAHP, was set at $33.64 billion, $200 million less than the $33.84 billion enacted
for FY2004. Funding for exempt programs (emergency relief and a portion of
minimum guarantee funding) was set at $835 million, down $96 million from
FY2004’s $931 million.
The FY2005 Consolidated Appropriations Act provides $34.86 billion for
FHWA (prior the the 0.80% rescission). This is $316 million above the FY2004
enacted level and $683 million above the Bush Administration proposal. The
obligation limitation is set at $34.64 billion (prior to the 0.80% rescission). This is
roughly $1 billion above the FY2004 enacted obligation limitation. Exempt
obligations are set at $835 million, the same as the budget proposal and $96 million
below the FY2004 enacted level. An additional $80 million is provided for the
Appalachian Development Highway System (ADHS). The Act also provides an
additional $741 million for the Emergency Relief program (to help cover the
program’s backlog of requests and help fund hurricane damage incurred in 2004).
The Act rescinds $1.35 billion in unobligated previous year contract authority from
the core formula programs and $100 million from unobligated Transportation
Infrastructure Finance and Innovation Act (TIFIA) funds.
Section 117 of the Act sets aside a 4.1% administrative take-down of Federal
Lands Highway program allocations and apportionments to the core formula
programs, ADHS, and the Minimum Guarantee program. From this take-down, $25
million is made available to the Delta Regional Authority and $1.21 billion is
earmarked for 795 projects. The earmarked amounts that made available under
Section 117 may be used to make grants eligible under U.S. C. Title 23 (Highways)
or Title 49 (Transit), are available until expended, have a 100% federal share, and are
only subject to the obligation limitation for the current fiscal year. The Consolidated
Act also earmarks virtually all the funds provided for FHWA discretionary programs.
Federal Motor Carrier Safety Administration (FMCSA)
[ http://www.fmcsa.dot.gov/]
The FMCSA was created by the Motor Carrier Safety Improvement Act of 1999
(MCSIA), P.L. 106-159.⁵ This agency became operational on January 1, 2000, and
assumed almost all of the responsibilities and personnel of DOT’s Office of Motor

⁴ These figures reflect rescissions of previous year contract authority of $207 million for
FY2004 (enacted) and $300 million for FY2005 (proposed).
⁵ During various hearings held in the first session of the 106^th Congress, a number of
organizations, including DOT’s Inspector General, the General Accounting Office, and many
industry associations raised a variety of concerns regarding the effectiveness of the federal truck
and bus safety program. In response to these concerns, Congress created the FMCSA.

Carrier Safety.⁶ FMCSA issues and enforces the Federal Motor Carrier Safety
Regulations that govern many aspects of specified commercial truck and bus
operations, including the interstate operation and maintenance of commercial
vehicles, and specify requirements for commercial drivers. FMCSA also administers
grants and programs to help states conduct truck and bus safety compliance activities.
Together with the states, FMCSA conducts inspections of Mexican-domiciled drivers
and vehicles entering the United States, advances Intelligent Transportation Systems
for commercial operations, and reviews thousands of carriers transporting property
and passengers. Most of the funds used to conduct FMCSA activities are derived
from the Federal Highway Trust Fund.
The FY2005 Administration request for the FMCSA is $455 million. The House
Committee on Appropriations recommended $438.5 million; this was eliminated
during floor debate on a point of order. However, most observers expected the
reported figure to be used as the House benchmark during conference discussions.
The Senate Committee on Appropriations recommended $450 million. The FMCSA
appropriation has two primary components: FMCSA administrative expenses
(including operations and research); and financial assistance provided primarily to
the states to conduct various truck and bus safety programs. For FY2005, Congress
approved an appropriation of $447.5 million to FMCSA’s account: $257.5 million
for administrative and research expenses under the FMCSA limitation on
administrative expenses account, and $190 million for motor carrier safety grants and
information systems.
Administrative and Operations Expenses. The President’s budget
request for FMCSA’s administrative and operations expenses in FY2005 is $228
million. The House Committee on Appropriations recommended $248.5 million; this
was eliminated during the House floor debate on a point of order. Most observers
expected the reported figure to be used as the House benchmark during conference
discussions. The Senate Committee on Appropriations recommended $260 million
for its limitation on administrative expenses. The FY2005 amount specified by the
conferees is $257.5 million. This account includes funds for research and technology
(R&T) and regulatory development. Some of the activities that would be funded
include enforcement to reduce the number of unsafe motor carriers and drivers, and
the funding of a medical review board to assist FMCSA in improving its physical
requirements for commercial drivers. Some of the core FMCSA activities or
expenses supported by these funds include rent, administrative infrastructure,
personnel compensation and benefits and other related staff expenses for more than
1,000 employees; outreach efforts to help educate the commercial motor vehicle
industry about the federal safety regulations; and monies to improve truck and bus,
as well as driver, standards and oversight. This account also funds agency
information systems used to oversee the safety of motor carriers.
Grants to States and Other Activities. The Administration’s FY2005
request for these activities is $227 million. The House Committee on Appropriations

⁶ DOT’s Office of Motor Carrier Safety, which operated from October 9 through December
31, 1999, replaced the Office of Motor Carriers of the Federal Highway Administration of
the DOT.

recommended $190 million; this was eliminated during House floor debate on a point
of order, but was expected to be used as the House benchmark during conference
discussions. The Senate Committee on Appropriations recommended the same
amount. The conference report recommended funding for FY2005 at the $190
million level. These funds are used primarily to pay for the Motor Carrier Safety
Assistance Program (MCSAP), which provides grants to states to help them enforce
commercial vehicle safety and hazardous materials transportation regulations.
MCSAP grants cover up to 80% of the costs of a state’s truck and bus safety
program. Some 10,000 state and local law-enforcement officers conduct more than
2.9 million roadside inspections of trucks and buses annually under the program. The
FY2005 appropriation included $169 million dedicated to MCSAP, and an additional
$20 million for information systems and strategic safety initiatives.
National Highway Traffic Safety Administration (NHTSA)
[ http://www.nhtsa.dot.gov/]
NHTSA funding supports behavioral (primarily driver and pedestrian) and
vehicle (primarily crash worthiness and avoidance) programs that are intended to
improve traffic safety. More specifically, NHTSA seeks to reduce impaired driving,
increase occupant protection, improve police traffic services, enhance emergency
medical responses to crashes, ensure compliance with various federal vehicle safety
regulations, and track and seek to mitigate emerging vehicle safety problems.
NHTSA also provides grants to the states for the implementation of various highway
traffic safety programs.
For FY2005, $689.3 million was requested to carry out NHTSA’s mission. Of
the total amount requested by the Administration, $456 million was designated to
support general traffic safety and incentive grants to states. The incentive grants are
intended primarily to encourage occupant protection measures and reduce impaired
driving. The remaining $233 million was for NHTSA’s operations and research
activities to reduce highway fatalities and prevent injuries due to traffic crashes.
More specifically, the funds proposed would be used for activities including research
and analysis (e.g., collection of crash statistics and research on vehicle performance
and occupant damage during these crashes); highway safety programs (e.g.,
developing improved countermeasures to combat alcohol- or drug-impaired driving);
safety assurance (e.g., testing of vehicles to ensure compliance with federal motor
vehicle safety standards and maintaining a legislatively-required database to track
vehicle defects); and safety performance standards (e.g, conducting crash avoidance
and crash-worthiness testing, and evaluating child safety seats). The House
Committee on Appropriations recommended $225 for traffic safety grants and $223.1
million for NHTSA’s operations and research (this money was stricken during the
House floor debate on a point of order, but most observers expected the reported
figures to be used as the House benchmark during conference discussions). The
Senate Committee on Appropriations recommended $225 million for traffic safety
grants and $228.3 million for operations and research. The conference report for
FY2005 provides $225 million for traffic safety grants and $233 million for
operations and research.

Federal Railroad Administration (FRA)
[ h ttp://www.fra.dot.gov]
The Administration requested $1.09 billion in funding for the Federal Railroad
Administration; this was $357 million (25%) less than the $1.455 billion enacted for
FY2004, but was the same amount requested for FY2004. The House Committee on
Appropriations recommended $1.09 billion (which was eliminated during House
floor debate on a point of order). The Senate Committee on Appropriations
recommended $1.44 billion; the Senate did not pass an FY2005 transportation
appropriations bill. Conferees agreed on $1.44 billion. In FY2004, the House
agreed to $1.09 billion, the Senate agreed to $1.57 billion, and conferees agreed on
$1.455 billion. Most of FRA’s funding is for Amtrak, and the difference between the
House and Senate amounts for FY2005, as in FY2004, was almost entirely additional
funding for Amtrak.
Although most of the debate involving the FRA budget centers on Amtrak,
agency safety activities (which receive more detailed treatment following this
section), the Next Generation High-Speed Rail program, and how states might obtain
additional funds for high-speed rail initiatives are also continuing issues.
Railroad Safety. The FRA promotes and regulates railroad safety. Increased
railroad traffic volume and density make equipment, employees, and operations more
vulnerable to accidents. The Administration proposed $142.4 million in FY2005 for
FRA’s safety program and related administrative and operating activities. The House
Committee recommended $137.7 million; the Senate Committee on Appropriations
recommended $139.8 million. The conference report specifies $139.8 million for
FY2005. Most of the funds appropriated are used to pay for salaries as well as
associated travel and training expenses for FRA’s field and headquarters staff and to⁷
pay for information systems monitoring the safety performance of the rail industry.
The funds requested support FRA’s goals of reducing rail accidents and incidents,
reducing grade-crossing accidents, and contributing to the avoidance of serious
hazardous materials transportation incidents.
The railroad safety statute was last reauthorized in 1994. Funding authority for
the program expired at the end of FY1998. FRA’s safety program continues using the
authorities specified in existing federal railroad safety law and funds provided by
annual appropriations. Though hearings have been held since 1994, the deliberations
have not resulted in agreement on funding for FRA’s regulatory and safety
compliance activities or change to any of the existing authorities used by FRA to
promote railroad safety. A reauthorization statute changing the scope and nature of
FRA’s safety activities would most likely affect budgets after FY2005.

⁷ The funds also are used to conduct a variety of initiatives, including the Safety Assurance
and Compliance Program (SACP), the Railroad Safety Advisory Committee (RSAC), and
field inspections. SACP involves numerous partnerships forged by railroad management,
FRA personnel, and labor intended to improve safety and compliance with federal railroad
safety regulations. RSAC uses a consensus-based process involving hundreds of experts who
work together to formulate recommendations on new or revised safety regulations for FRA’s
consideration.

Next Generation High-Speed Rail R&D. This program supports work on
high-speed train control systems, track and structures technology, corridor planning,
grade crossing hazard mitigation, and high-speed non-electric locomotives. The
Administration requested $10 million for this program for FY2005; this was $27.4
million (73%) less than the FY2004 appropriation of $37.4 million, and $13.2
million less than the Administration’s FY2004 request ($23.2 million). The
Administration request cut high-speed train control systems ($10 million enacted for
FY2004; $5 million requested for FY2005); high-speed non-electric locomotive
development ($9.9 million enacted for FY2004; $2 million requested for FY2005);
grade crossing hazard mitigation ($9 million enacted for FY2004; $2 million
requested for FY2005); corridor planning ($2.5 million enacted for three corridors
for FY2004; no request for FY2005); and maglev ($5 million enacted for FY2004 for
four maglev projects; no request for FY2005).
The House Committee on Appropriations recommended $11 million; the
additional $1 million was for grade crossing hazard mitigation. The Senate
Committee on Appropriations recommended $20 million; the additional money was
for corridor planning, maglev projects, and more funding for high-speed train control
systems. Conferees agreed on $19.7 million.
Amtrak. Beginning with Amtrak’s FY2003 appropriation (P.L. 108-7),
Congress directed that Amtrak’s appropriation would not go directly to Amtrak, but
rather that the Secretary of Transportation would provide funding to Amtrak quarterly
through the grant-making process. Congress also imposed several other requirements
on Amtrak beginning in FY2003 which had the effect of reducing Amtrak’s
discretion with its federal funding. Among these was a requirement that Amtrak
submit a five-year business plan to Congress, which it did on April 25, 2003. In this
plan, Amtrak requested average annual federal support of $1.6 billion for FY2004-
FY2008 to both maintain the current network and begin to address the estimated $6
billion in backlogged maintenance needs. The plan did not propose expansion of the
existing rail network. Amtrak has submitted annual updates of this Strategic Plan to
Congress.
The Administration requested $900 million for Amtrak for FY2005. This was
$318 million less than Amtrak’s FY2004 appropriation of $1.218 billion⁸ and $900
million less than the $1.8 billion Amtrak requested for FY2005. The House
Committee on Appropriations recommended $900 million for Amtrak; the Senate
Committee on Appropriations recommended $1.2 billion, and noted that Amtrak
would receive an additional $330 million in FY2005 from a provision in another bill
(S. 1637, the Senate’s version of the export tax repeal legislation), giving Amtrak a
total of $1.55 billion for FY2005.⁹ However, the export tax repeal legislation passed
by Congress (P.L. 108-357) did not include the Amtrak funding provision. Conferees
agreed on $1.2 billion for Amtrak, virtually identical to the FY2004 level. Conferees
also again postponed Amtrak’s repayment of a $100 million loan provided by the

⁸ After rescission. For FY2004, Congress also deferred Amtrak’s repayment of a $100
million loan to the DOT.
⁹ S.Rept. 108-342, p. 93.

DOT in FY2002; however, conferees directed Amtrak to repay the loan in five equal
annual installments, beginning in FY2005.
Conferees also included provisions, originally added by the House Committee
on Appropriations, that require Amtrak to develop an operating and capital plan for
FY2005 in order to receive FY2005 funding; direct the Secretary of Transportation
to retain a consultant to value Amtrak’s capital assets and to develop a methodology
to determine the avoidable and fully allocated costs of each Amtrak route, which
Amtrak shall use to report to Congress on the costs of each of its routes; and prohibit
Amtrak from submitting an independent budget request after FY2005, instead
requiring Amtrak to submit its budget request through the DOT, where it will be
vetted by the Office of Management and Budget. Conferees also directed the
Secretary of Transportation to continue an effort, initiated by the FY2004 conference
agreement, to establish a procedure for competitive bidding by non-Amtrak operators
for state-supported routes currently operated by Amtrak. If a state wishes to contract
with an operator other than Amtrak for service, the state may contract with Amtrak
for use of Amtrak’s equipment, facilities, and services necessary to enable the non-
Amtrak operator to provide the service. If Amtrak and a state cannot agree on terms
for this use, the Secretary of Transportation is given the power to compel Amtrak to
provide the equipment, facilities and services on terms and conditions set by the
Secretary.
The Administration also requested $900 million for Amtrak for FY2004, when
Amtrak also requested $1.8 billion. The House agreed to $900 million for Amtrak,
and added a provision allowing states to apply to FHWA to transfer a portion of their
allocation of an appropriation of $267 million from the Highway Trust Account to
Amtrak.¹⁰ The Senate agreed to $1.346 billion for Amtrak, and extended to all
Amtrak routes the requirement (begun for FY2003) that Amtrak’s long-distance
routes be funded through individual grant requests from Amtrak to the DOT.
Conferees agreed on $1.225 billion, continued the new funding structure begun in
FY2003, and extended to all Amtrak routes the requirement that they be funded
through individual grant requests.
Federal Transit Administration (FTA)
[ http://www.fta.dot.gov/]
President Bush’s FY2005 budget request for FTA was $7.27 billion, similar to
FTA’s FY2004 appropriation of $7.27 billion and slightly more than the FY2004
request for $7.23 billion. The Administration’s request also proposed changes to
FTA’s program structure, reflecting the Administration’s transit reauthorization
proposals. These proposals included grouping all funding into three categories
(administrative expenses, formula funds, and capital investment grants), zeroing out
the Bus Discretionary grant program, and creating a New Freedom Initiative program
to help assist persons with disabilities with transportation to work. Similar changes
were proposed by the Administration during FY2004, but were not adopted by
Congress; Congress did not support these changes for FY2005 either.

¹⁰ The provision was in the House Committee on Appropriations report (p. 72), not the bill.

The House Committee on Appropriations recommended $7.25 billion for
FY2005. During the House floor debate on the FY2005 appropriations bill, FTA’s
funding was eliminated on a point of order. As the funding reported out by the
House Committee on Appropriations was expected to be the House benchmark
during conference discussions, those figures were kept in this section. The Senate
Committee on Appropriations recommended $7.76 billion; the Senate bill was never
taken up by the full Senate. Conferees agreed on $7.7 billion.
FTA Program Structure and Funding. The largest transit programs are
the Capital Investment Grants and Loans Program and the Urbanized Area Formula
Grants Program. There are also several smaller formula and discretionary programs.
Capital Investment Grants and Loans Program (Section 5309). This
program (formerly known as Section 3) has three components: new transit starts,
fixed guideway modernization, and bus and bus facilities. The funds are allocated
among these three components on a roughly 40-40-20 basis, respectively; funds for
the fixed guideway component are distributed by formula, while funds for the other
components are distributed on a discretionary basis by FTA or earmarked by
Congress. The Administration requested $1.532 billion for the new transit starts
program, up from $1.324 billion in FY2004 (a 16% increase) and $1.239 billion for
fixed guideway modernization, up from $1.207 billion in FY2004 (a 3% increase).
The Administration requested no funding for the bus and bus facilities discretionary
program, which received $677 million in FY2004; instead, the Administration would
reallocate the money for that program to the new transit starts program and the Non-
Urbanized Areas Formula Program. The House Committee recommended $1.031
billion for the new transit starts program, a 22% decrease from FY2004; $1.214
billion for fixed guideway modernization, the same as FY2004; and $607 million for
bus and bus facilities (the same amount enacted for FY2004, though the FY2004
appropriation was supplemented with funds transferred from other FTA programs,
for a total of $677 million). The Senate Committee on Appropriations recommended
$1.474 billion for the new transit starts program (11% over FY2004 ); $1.214 billion
for fixed guideway modernization (the same as FY2004); and $725 million for bus
and bus facilities (7% above FY2004’s $677 million). Conferees agreed on $1.474
billion for the new starts program (an 11% increase over FY2004), $1.214 billion for
fixed guideway modernization (the same as FY2004, which will result in a cut after
the rescission is applied), and $725 million for bus and bus facilities ($675 million
from capital grants funding, plus $50 million transferred from formula grants
funding; in total, $48 million more than the FY2004 enacted amount).
Urbanized Area Formula Program (Section 5307). This program
(formerly known as Section 9) provides capital and, in some cases, operating funds
for urbanized areas (population 50,000 or more). Elilgible activities include bus and
bus-related purchases and maintenance facilities, fixed guideway modernization, new
systems, planning, and operating assistance. Funds are apportioned by a formula
based, in part, on population (areas with populations over 1,000,000 receive
two-thirds of the funding; urbanized areas with populations under 1,000,000 receive
the remaining one-third) and on transit service data. For FY2005, the Administration
proposed $3.444 billion, a $15 million increase over the $3.429 billion provided in
FY2004 (less than a 1% increase); the House Committee recommended $3.633

billion (5.9% over FY2004). The Senate Committee recommended $3.604 billion
(4.9% over FY2004). Conferees agreed on $3.6 billion.
With the enactment of TEA-21, operating assistance funding was eliminated for
urbanized areas with populations over 200,000. However, preventive maintenance,
generally considered an operating expense, is now eligible for funding as a capital
expense. Urbanized areas under 200,000 population, and non-urbanized areas
(Section 5311), can use formula funds for either capital or operating purposes.
Other Transit Programs.
^!Non-Urbanized Areas Formula Program (Section 5311), which
provides capital and operating needs for non-urbanized areas (areas
with populations under 50,000) — $367 million requested for
FY2005 ($239 million appropriated in FY2004), the House
Committee recommended $253 million, the Senate Committee
recommended $251 million, and conferees agreed on $253 million;
^!Grants for Elderly and Individuals with Disabilities (Section 5310)
— $89 million requested for FY2005 ($91 million appropriated in
FY2004), the House and Senate Committees recommended $95
million, which conferees agreed on;
^!Planning and Research programs — $169 million requested for
FY2005 ($126 million appropriated for FY2004), the House
Committee recommended $126 million, the Senate Committee
recommended $128 million, and conferees agreed on $128 million;
and
^!Rural Transportation Accessibility Incentive Program (Section

3038), also known as the over-the-road bus accessibility program —

$7 million requested for FY2005 ($7 million appropriated in
FY2004 also), the House and Senate Committees also recommended
$7 million, which conferees agreed on.
The President’s budget request proposed to create a new formula program, the
New Freedom Initiative, which would use alternative methods to promote access to
transportation for persons with disabilities. The President’s budget requested $148
million for this program in FY2005. Congress did not support this request.
Job Access and Reverse Commute Program. TEA-21 authorized a new
discretionary Job Access and Reverse Commute grant program. This program
provides funding for transportation projects that assist welfare recipients and low-
income persons to find and get to work in suburban areas. The Administration
proposed $153 million for it in FY2005, up from the $125 million appropriated in
FY2004; the House Committee recommended $150 million, the Senate Committee
recommended $125 million, and conferees agreed on $125 million.

Table 5. FTA Appropriation, FY2003-FY2005
(millions of dollars)
^FY²⁰⁰⁴^FY²⁰⁰⁵^FY²⁰⁰⁵^FY²⁰⁰⁵^FY²⁰⁰⁵
^Program^FY²⁰⁰³^Ena^c^t^e^d^Ena^c^t^e^d^Request^Hou^s^e**^Sena^t^e^Ena^c^t^e^d
^*^Cm^te.^***
^Urbanⁱ^{zed A}^r^eas^Form^u^l^a
^Prog^ram^(S^ectⁱ^oⁿ⁵³⁰⁷⁾^$3,407^$3,429^$3,444^$3,633^$3,604^$3,622
^Cap^{ital I}ⁿ^v^e^stm^eⁿ^t^Gr^an^{ts &}
^L^o^an^s^P^r^og^ram^(Section
^{5309) T}^o^t^a^l³^,016^3,119^2,771^2,853^3,414^3,363
^N^e^w^St^ar^t^s^Pr^ogr^am^1,207^1,324^1,532^1,031^1,474^1,474
^{Fixed Guidew}^ay
^M^oderⁿⁱ^z^atⁱ^{on Pr}^ogr^am^1,207^1,207^1,239^1,214^1,214^1,214
^Bus^Dⁱ^s^c^r^e^tⁱ^onar^y
^Pr^ogr^am^****⁶⁰³⁶⁰⁷^—⁶⁰⁷⁷²⁵⁶⁷⁵
^Non^-^Urbanⁱ^{zed A}^r^eas
^F^o^rm^u^l^{a P}^r^og^ram^(S^ectⁱ^oⁿ
⁵³¹¹⁾²³⁷²³⁹³⁶⁷²⁵³²⁵¹²⁵³
^{Job A}^cces^s^&^R^e^v^e^rs^e
^C^o^m^m^u^t^e^Prog^ram¹⁴⁹¹²⁴¹⁵³¹⁵⁰¹²⁵¹²⁵
^El^derl^y^&^In^di^vⁱ^du^al^s^wⁱ^t^h
^Disab^{ilities Fo}^r^m^u^l^{a P}^r^o^g^r^a^m
^(S^ectⁱ^oⁿ⁵³¹⁰⁾⁹⁰⁹¹⁸⁹⁹⁵⁹⁵⁹⁵
^Ru^r^a^{l T}^r^an^sp^o^r^tatioⁿ
^A^ccessib^ility^Iⁿ^cen^tiv^e
^Prog^ram^(S^ectⁱ^oⁿ^{3038), al}^s^o
^kⁿ^o^wⁿ^as^th^{e Ov}^er-^t^h^e^-^R^oad
^B^u^{s A}^ccessib^ility^p^r^o^g^r^a^m⁷⁷⁷⁷⁷⁷
^Pl^anⁿⁱⁿ^g^&^R^e^s^earch¹²¹¹²⁵¹⁶⁹¹²⁶¹²⁸¹²⁸
^O^t^h^e^r¹⁴⁵¹⁵⁵¹¹⁸¹³³¹³³¹¹⁵
^New^Fr^eed^o^m^Iⁿ^itiativ^e^—^—¹⁴⁸^—^—^—
^FT^A^T^o^tal⁷^,179^7,266^7,266^7,249^7,758^7,708
^Note:^num^be^r^s^m^a^y^{not a}^{dd due}^{to r}^ounding^.
^Sour^c^e^:^Fig^u^r^e^s^w^e^r^e^ta^k^e^{n f}^r^om^T^r^aⁿ^s^por^ta^tion-^T^r^e^a^s^ur^y^B^udg^e^t^A^u^thor^ity^ta^ble^s^pr^ov^ide^d^by^the^H^ous^e
^C^o^m^m^itte^e^{on A}^ppr^opr^ia^tions^.
^*^F^Y^{2004 f}ⁱ^g^u^r^e^s^r^e^f^l^e^c^t^aⁿ^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^{on of}^0.59%^.
^*^*^A^{ll FT}^A^f^unding^f^o^r^F^Y^{2005 w}^a^s^e^lⁱ^mⁱⁿ^a^t^e^d^d^u^rⁱⁿ^g^H^o^u^s^e^f^l^o^o^r^d^e^b^a^t^e^oⁿ^a^p^oⁱⁿ^t^o^f^o^r^d^e^r^.^A^s^t^h^e
^T^r^aⁿ^s^por^ta^tion-^T^r^easu^r^y^A^ppr^opr^ia^tions^s^ubc^om^m^itte^e^c^h^aⁱ^r^{told his}^c^o^lle^a^g^ue^s^tha^t^the^f^unding^w^{ould be}
^r^e^s^t^or^e^d^{in c}^onf^e^r^eⁿ^c^e^,^the^fⁱ^g^u^r^e^s^r^e^co^m^m^e^nde^{d by}^the^A^ppr^opr^ia^tions^C^o^m^m^itte^e^ha^v^e^be^eⁿ^r^e^ta^ine^d^{in this}
^ta^ble^.
^***F^Y^{2005 f}ⁱ^g^u^r^e^s^{do not r}^e^f^l^e^c^t^aⁿ^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^{on of}^0.80%^.
^****T^h^e^F^Y^{2004 a}^ppropria^{tion of}^{$607 m}^{illion w}^a^s^s^upple^m^eⁿ^te^d^w^{ith $70 m}^{illion tra}ⁿ^s^f^e^rre^d^f^r^om^othe^r^FT^A
^prog^ra^m^s^{, f}^o^{r a}^tota^{l of}^{$677 m}^{illion; the}^FY^{2005 a}^ppropria^{tion of}^{$675 m}^{illion w}^a^s^s^upple^m^eⁿ^te^{d w}^{ith $50}
^m^{illion tra}ⁿ^s^f^e^rre^{d f}^r^om^othe^{r FT}^A^prog^ra^m^s^{, f}^o^{r a}^tota^{l of}^{$725 m}^illion.

Maritime Administration (MARAD)
[ h ttp://www.marad.dot.gov]
MARAD’s mission is to promote the development and maintenance of a U.S.
merchant marine capable of carrying the nation’s waterborne domestic commerce,
a portion of its waterborne foreign commerce, and to serve as a naval and military
auxiliary in time of war. MARAD administers programs that benefit U.S. vessel
owners, shipyards, and ship crews. For FY2005, the President requested $234.4
million for MARAD, which is about $13 million more than was enacted in FY2004.
In the omnibus appropriations measure for FY2005, Congress provided a total of
$305 million for MARAD. Most of the difference between the amount Congress
provided and the amount the President requested has to do with a new program to
construct U.S.-flagged oil tankers, which is explained further below.
Much of the discussion concerning MARAD’s budget focuses on the Maritime
Guaranteed Loan Program (the “Title XI” program). This program provides
guaranteed loans for purchasing ships from U.S. shipyards and for the modernization
of U.S. shipyards. The purpose of the program is to promote the growth and
modernization of U.S. shipyards. Consistent with its budget requests in prior years,
the Administration has requested no funds for additional loans in FY2005, calling the
program a “corporate subsidy.” The Administration has, however, requested $4.8
million for the administration of existing loans which Congress agreed to. In
FY2004, no funds were provided for additional loans, but $4.5 million was provided
for the administration of existing loans.
The DOT Inspector General issued a report in March 2003 on the Title XI
program (CR-2003-031) calling on MARAD to review loan applications more
effectively, exercise more rigorous financial oversight of borrowers, and use an
external financial advisor in reviewing loan applications. The IG’s investigation was
prompted by the bankruptcy of American Classic Voyages, leaving MARAD with
$367 million in bad loans for the construction of two cruise ships. At a June 5, 2003
Senate Commerce Committee hearing on the Title XI program, the General
Accounting Office also identified weaknesses in the program and made
recommendations for improving the financial oversight of the program (GAO-03-
728T). In July 2004, the DOT announced the creation of a department-wide Credit
Council to enhance the oversight and management of the Title XI program and other
loan and loan guarantee programs administered by other DOT agencies.¹¹
For operations and training, the Administration requested $109.3 million, about
$3 million more than Congress enacted in FY2004. In the omnibus appropriations
measure, Congress provided $109.5 million. The Senate Appropriations Committee
also directed MARAD to prepare a conditions and performance report and needs
assessment of the nation’s inland waterway system in order to prepare for an
anticipated increase in domestic and international maritime trade. This type of study
was also one of the recommendations made by the Marine Board of the

¹¹ See MARAD press release no. 12-04, July 14, 2004.

Transportation Research Board.¹² For the Maritime Security Program (MSP), the
Administration requested $98.7 million which is the same amount that Congress
provided in the omnibus appropriations measure and virtually the same amount as
Congress provided last year. MSP is a fleet of 47 privately-owned U.S. flag
commercial vessels engaged in international trade that are available to support the
Department of Defense in a national emergency.
For the disposal of obsolete vessels in the National Defense Reserve Fleet
(NDRF), the Administration requested and Congress provided $21.6 million, about
$5.5 million more than was enacted for FY2004. There are over 130 vessels in the
NDRF that are awaiting disposal because of their age. These vessels have raised
environmental concerns due to the presence of asbestos and other hazardous
substances. MARAD has until 2006 to dispose of these surplus ships, most of which
are located on the James River in Virginia and in Suisan Bay, California.
In the omnibus appropriations measure, Congress provided $75 million in
funding for a financial assistance program designed to encourage the construction of
up to five privately owned product tanker vessels. This financial assistance program
was authorized under subtitle D of the Maritime Security Act of 2003 (P.L. 108-136),
National Defense Tank Vessel Construction Assistance. The program would provide
up to $50 million per vessel for the construction of a commercial tank vessel in a
U.S. shipyard, provided that the vessel was also capable of carrying militarily useful
petroleum products and the shipowner entered into an agreement with the
Department of Defense to make the ship available for the military’s use in time of
war. The intent of the law is to decrease the Department of Defense’s reliance on
foreign-flag oil tankers. An aspect of the program that has proved controversial is
the allowance of up to 10% of a vessel’s total steel weight to be constructed by a
foreign shipyard. Some argue this is necessary to allow U.S. shipyards to import
foreign technological expertise, while others argue that it results in subsidies flowing
to foreign shipyards. Before the conference agreement was reached on $75 million,
the Senate bill had provided $150 million for this program while the House bill had
provided no funds.
Research and Special Programs Administration (RSPA)
[ http://www.rspa.dot.gov]
The Research and Special Programs Administration (RSPA) includes a variety
of operating entities, including the Office of Pipeline Safety and the Office of
Hazardous Materials Safety. RSPA also conducts a multimodal research program,
helps coordinate and plan for transportation research and technology transfer
activities, sponsors educational activities to promote innovative transportation, and
manages DOT’s transportation-related emergency response and recovery
responsibilities.

¹² Transportation Research Board, The Marine Transportation System and the Federal Role,
Special Report 279, 2004, available at [http://trb.org/publications/sr/sr279.pdf].

For FY2005, the Administration requested a budget of $123.25 million for
RSPA (not including a limitation on the emergency preparedness fund of $14.3
million); most of this funding is for activities that promote transportation safety. For
RSPA’s pipeline transportation safety program, $70 million was proposed by the
Administration (an increase of $4 million over the FY2004 appropriation); for the
hazardous materials transportation safety program, $25.5 million was requested. The
House Committee recommended $115.3 million for RSPA, including $68.5 million
for the pipeline safety program and $24.9 million for the hazardous material
transportation safety program. The Senate Committee recommended $120.3 million,
including $24.5 million for hazardous materials safety and $71.1 million for pipeline
safety. The conference report provides $117 million for FY2005, which includes
$25.2 million for hazmat transportation safety and $69.8 million for pipeline safety.

Title II: Treasury Appropriations
Table 6. Title II: Department of the Treasury Appropriations
(millions of dollars)
^Program^{or A}^ccouⁿ^t^FY²⁰⁰⁴^Ena^c^t^e^d*^FY²⁰⁰⁵^Request^FY²⁰⁰⁵^Hou^s^e^FY²⁰⁰⁵^Sena^t^e^FY²⁰⁰⁵^Ena^c^t^e^d*^*
^Departm^eⁿ^t^{al Of}^fⁱ^ces^$175^$185^$177^$161^$158
^Of^fⁱ^{ce o}^f^Fo^reigⁿ^A^{sset Co}ⁿ^t^ro^l^—^—^—²²²²
^Departm^eⁿ^t^-^w^{ide Sy}^s^t^em^s^an^d
^Cap^{ital I}ⁿ^v^e^stm^eⁿ^t^s³⁶³⁶³⁶³⁰³²
^Of^fⁱ^{ce of}^In^s^p^{ector Gen}^e^ral¹³¹⁴¹⁷¹⁶¹⁷
^T^r^eas^u^r^y^In^s^p^{ector Gen}^e^{ral f}^o^r
^T^a^x^A^d^mⁱⁿⁱ^s^t^ratⁱ^oⁿ¹²⁷¹²⁹¹²⁹¹²⁹¹²⁹
^Aⁱ^r^T^r^an^sp^o^r^tatioⁿ^Stab^ilizatioⁿ
^Pr^og^r^a^m³³²²²
^T^r^easu^r^y^B^u^ildⁱⁿ^g^Rep^a^ir^an^d
^R^e^s^t^o^a^tⁱ^oⁿ²⁵²⁰²⁰¹²¹²
^Fin^aⁿ^c^{ial C}^r^im^es^En^f^o^rcem^en^t
^N^e^t^w^o^r^k⁵⁷⁶⁵⁹⁰⁷³⁷³
^Fⁱⁿ^aⁿ^cⁱ^a^l^Man^a^g^e^m^eⁿ^t^S^e^rvⁱ^c^e²²⁷²³¹²³¹²³¹²³¹
^A^l^coh^o^{l an}^{d T}^{obacco T}^a^x^an^d
^T^r^{ade Bu}^reau⁸⁰⁸²⁸³⁸³⁸³
^Bu^reau^of^t^h^{e Pu}^blⁱ^c^D^e^bt¹⁷³¹⁷⁵¹⁷⁵¹⁷⁵¹⁷⁵
^In^t^e^rn^al^R^e^v^eⁿ^u^e^S^e^rvⁱ^{ce, T}^o^t^a^l^10,185^10,674^10,292^10,253^10,319
^P^r^o^c^e^ssin^g^,^A^ssistaⁿ^c^e
^{and M}^anagem^e^nt^4,009^4,148^4,072^4,107^4,090
^T^a^{x L}^a^w^Enf^o^r^cem^ent⁴^,171^4,564^4,278^4,519^4,399
^Inf^o^r^m^atⁱ^{on Sys}^t^em^s¹^,582^1,642^1,622^1,607^1,590
^B^u^sin^e^{ss S}^y^ste^m^s
^M^oderⁿⁱ^z^atⁱ^oⁿ³⁸⁸²⁸⁵²⁸⁵¹²⁵²⁰⁵
^Hea^lth^Iⁿ^su^raⁿ^{ce Ta}^x
^Cred^{it Ad}^minⁱ^stra^tioⁿ³⁵³⁵³⁵³⁵³⁵
^T^o^tal^,^D^e^p^t^{. of th}^{e T}^reas^u^ry^11,100^11,610^11,247^11,184^11,248
^S^o^u^rce:^Fig^u^re^s^a^r^e^f^r^om^a^budg^e^t^a^u^thority^ta^ble^prov^ide^d^by^the^H^ous^e^Com^m^itte^e^on^A^ppropria^tions^.^B^ecau^se
^of^dif^f^e^ring^tre^a^t^m^e^nt^of^of^f^s^e^t^{s, the}^tota^{ls w}^{ill not a}^l^w^a^y^s^m^a^tc^{h the}^A^d^mⁱ^nistra^{tion’s tota}^ls.^T^h^e^fⁱ^g^u^re^s^w^ithin
^this^ta^ble^m^a^y^dif^f^e^r^s^lig^htly^f^r^om^thos^eⁱⁿ^t^h^e^t^e^xt^due^{to s}^upple^m^eⁿ^ta^{l a}^ppr^opr^ia^tions^{, r}^e^s^c^is^sⁱ^ons^{, a}^{nd othe}^r
^f^unding^a^c^tions^{. C}^o^lumⁿ^s^m^a^y^{not a}^{dd due}^{to r}^ounding^or^e^x^c^l^us^{ion of}^s^m^a^lle^r^pr^og^r^a^m^line^-^ite^m^s^.
^*^FY^{2004 f}ⁱ^g^u^r^e^s^r^e^f^l^e^c^t^aⁿ^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^{on of}^0.59%^.
^*^*^F^Y^{2005 f}ⁱ^g^u^r^e^s^{do not r}^e^f^l^e^c^t^aⁿ^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^{on of}^0.80%^.
Department of the Treasury Budget and Key Policy Issues
In recent decades, the Treasury Department has performed four basic functions:
(1) formulating, recommending, and implementing economic, financial, tax, and
fiscal policies; (2) serving as the financial agent for the federal government; (3)
enforcing federal financial, tax, counterfeiting, customs, tobacco, alcoholic beverage,

and gun laws; and (4) producing postage stamps, currency, and coinage. The creation
of the Department of Homeland Security (DHS) in late 2002 and its assumption of
the authorities transferred to it by executive order in March 2003 significantly
changed Treasury’s functional profile. While Treasury still serves as a principal
source of economic policymaking within the executive branch of the federal
government and the government’s financial manager, revenue collector, and producer
of currency, coinage, and stamps, its role in law enforcement is now much more
circumscribed.
At the most basic level of organization, the department consists of departmental
offices and operating bureaus. The departmental offices are responsible for the
formulation and implementation of policy and the management of the department as
a whole, and the operating bureaus carry out specific tasks assigned to the
department. The bureaus typically account for more than 95% of the department’s
personnel and funding.
With one notable exception, the bureaus can be divided into those discharging
financial responsibilities and those engaged in law enforcement. In recent decades,
financial responsibilities have been handled by the Comptroller of the Currency, U.S.
Mint, Bureau of Engraving and Printing, Financial Management Service, Bureau of
Public Debt, Community Development Financial Institutions Fund, and Office of
Thrift Supervision; law enforcement has been done by the Bureau of Alcohol,
Tobacco, and Firearms (BATF), U.S. Secret Service, Federal Law Enforcement
Training Center, U.S. Customs Service, Financial Crimes Enforcement Network
(FinCen), and Treasury Forfeiture Fund. The exception to this ineluctably simplified
dichotomy is the Internal Revenue Service (IRS), whose main responsibilities
combine the collection of tax revenue and the enforcement of federal tax laws.
The creation of DHS has greatly diminished Treasury’s involvement in law
enforcement. Under the law establishing DHS (P.L. 107-296), the Secret Service,
Customs Service, and Federal Law Enforcement Training Center were transferred
from Treasury to DHS, while the Treasury Forfeiture Fund and many functions of
BATF were transferred to the Justice Department (DOJ). On January 24, 2003, the
Treasury Department announced the establishment of a new bureau to administer
laws governing the use of alcohol and tobacco and implement regulations formerly
handled by BATF: the Alcohol and Tobacco Tax and Trade Bureau. Its main duties
consist of collecting alcohol and tobacco excise taxes, classifying those products for
tax purposes, and regulating the operations of industrial users of distilled spirits.
Treasury is taking steps to revamp its involvement in the federal government’s
inter-agency fight against the financing of international terrorist networks and other
financial crimes. In March 2003, the Treasury Secretary announced the
establishment of the Executive Office of Terrorist Financing and Financial Crimes
(EOTF). According to the initial plans released at the time, the Office was to co-
ordinate and direct Treasury’s efforts to combat terrorist financing and other financial
crimes and implement certain key provisions of the Bank Secrecy Act and the USA
Patriot Act, and to represent the United States in international organizations
dedicated to uncovering and thwarting terrorist financing and financial crimes. In
carrying out this task, EOTF was to have the authority to oversee and offer policy
guidance to FinCen and the Office of Foreign Assets Control (OFAC). But these

plans evidently never came to fruition. In March 2004, the Treasury Secretary
announced the formation of still another office to oversee and co-ordinate the
department’s contributions to government efforts to combat terrorist financing and
other financial crimes: the Office of Terrorism and Financial Intelligence (OTFI).
According to available information, OTFI is to guide and manage Treasury’s efforts
to uncover, monitor, and disrupt the networks of financial support for international
terrorist groups, assuming some of the responsibilities held by EOTF. The new
office is to perform two critical functions: (1) assemble, integrate, and analyze
financial intelligence through a newly formed Office of Intelligence and Analysis,
and (2) offer policy guidance and centralized direction to the Treasury bureaus
involved in the enforcement of laws against money laundering and other financial
crimes through the Office of Terrorist Financing and Financial Crimes.
In FY2004, the Treasury Department received $11.100 billion in appropriated
funds. Most of these funds were used to fund the operations of the IRS, whose
budget was set at $10.184 billion. The remainder was distributed as follows among
departmental offices and bureaus: departmental offices, $175.1 million;
departmental systems and capital investment programs, $36.2 million; Office of
Inspector General, $12.9 million; Inspector General for Tax Administration, $127.3
million; Air Transportation Stabilization program, $2.5 million; Treasury Building
and Annex Repair and Restoration, $24.8 million; Financial Crimes Enforcement
Network, $57.2 million; Financial Management Service, $227.2 million; Alcohol and
Tobacco Tax and Trade Bureau, $79.5 million; and Bureau of Public Debt, $172.6
million. These totals included a 0.59% across-the-board cut imposed on all non-
defense discretionary spending funded through appropriations measures in FY2004.¹³
For FY2005, the Bush Administration requested a budget for Treasury of
$11.610 billion, or $510 million above its level of funding in FY2004. Once again,
the vast share of this budget request was allocated to the IRS, which would receive
$10.674 billion, or $490 million more than it did in FY2004. The remaining
departmental offices and bureaus would receive the following appropriated amounts:
departmental offices, $185.0 million; departmental systems and capital investments,
$36.1 million; Office of Inspector General, $14.1 million; Inspector General for Tax
Administration, $129.1 million; Air Transportation Stabilization program, $2.8
million; Treasury Building and Annex Repair and Restoration, $20.3 million;
Financial Crimes Enforcement Network, $64.5 million; Financial Management
Service, $230.9 million; Alcohol and Tobacco Tax and Trade Bureau, $81.9 million;
and Bureau of the Public Debt, $175.2 million. Each account except that for
departmental systems and capital investments would be funded at a higher level than
in FY2004.
According to budget documents released by the Treasury Department, the
FY2005 budget request sought to accomplish the following objectives: (1) making
permanent the tax relief enacted under the Economic Growth and Tax Relief
Reconciliation Act of 2001 and the Jobs and Growth Tax Relief Reconciliation Act
of 2003; (2) improving individual and business compliance with tax laws; (3)
modernizing the IRS’s computer and management systems; (4) stepping up the effort

¹³ See Division H of section 168 of P.L. 108-109.

to monitor and disrupt terrorist financing; and (5) maintaining and safeguarding the
integrity of federal finances and the U.S. financial system. Recent congressional
testimony by Treasury officials has suggested that the two highest priorities were
improving tax compliance and thwarting terrorist financing. Oversight of Treasury
operations in the current Congress has focused on both activities.
The House Appropriations Subcommittee on Transportation, Treasury and
Independent Agencies took the first critical step in the annual appropriations cycle
for Treasury by approving by voice vote on July 15, 2004 a bill (H.R. 5025) to fund
its operations in FY2005. One week later the full Appropriations Committee
favorably reported the bill (H.Rept. 108-671). The House began to consider the
measure on September 14, 2004 and passed it eight days later by a vote of 397-12.
In its report on H.R. 5025, the Appropriations Committee issued what might be
construed as a stern rebuke to the department for creating a new office for combating
terrorist financing and other financial crimes (OTFI). The Committee charged that
“this action is completely contrary to the direction of the 2004 appropriation” and
noted that it has received neither “adequate information on any new terrorism office”
nor an “official budget amendment from the administration.”
Under H.R. 5025, as passed by the House, Treasury would receive $11.247
billion in funding in FY2005, or $147.1 million more than FY2004 but $362.9
million less than the amount requested by the Bush Administration for FY2005. The
IRS would receive the vast majority of the appropriated funds: $10.292 billion, or
92% of recommended appropriations for Treasury in FY2005. While such a budget
was $107.3 million above the amount appropriated for the IRS in FY2004, it is
$382.5 million below what the Administration requested for FY2005. (More details
on the budget for IRS in FY2004 and FY2005 can be found in the next section.)
H.R. 5025 would also provide $177.0 million in funding for Treasury’s departmental
offices (or $1.9 million more than FY2004 but $8.0 million less than the amount the
Bush Administration requested for FY2005), of which $21.8 million was designated
for the operations of OFAC; $36.1 million for the Treasury’s systems and capital
investments program (or $113,000 less than FY2004 but identical to the amount
requested for FY2005); $16.5 million for Treasury’s Office of Inspector General (or
$3.6 million more than FY2004 and $2.3 million more than the amount requested for
FY2005); $129.1 million for Treasury’s Inspector General for Tax Administration
(or $1.8 million more than FY2004 but identical to the amount requested for
FY2005); $2.0 million for the Air Transportation Stabilization Program (or $523,000
less than FY2004 and $800,000 less than the amount requested for FY2005); $20.3
million for Treasury’s building and annex repair and restoration program (or $4.5
million less than FY2004 but identical to the amount requested for FY2005); $90.0
million for the Financial Crimes Enforcement Network (after a House floor
amendment added $25.5 million; the $90 million is $32.7 million more than FY2004
and $25.5 million more than requested for FY2005); $230.9 million for the Financial
Management Service (or $3.7 million more than FY2004 but identical to the amount
requested for FY2005); $82.5 million for the Alcohol and Tobacco Tax and Trade
Bureau (or $3.0 million more than FY2004 and $600,000 more than the amount
requested for FY2005); and $175.2 million for the Bureau of the Public Debt (or $2.5
million more than FY2004 and identical to the amount requested for FY2005). In
addition, H.R. 5025 supported the Administration’s request to eliminate two current

programs — expanded access to financial services and violent crime reduction — by
canceling their unobligated balances from previous fiscal years.
During the floor debate in the House on H.R. 5025, several contentious
amendments were considered. A provision (Section 216 of Title II) in the version of
H.R. 5025 reported by the Appropriations Committee would have prohibited the
Treasury Department from issuing or implementing regulations to allow financial
institutions to accept matricula consular cards as a legitimate form of identification
for opening new accounts at financial institutions; it was struck by amendment on the
House floor. Another amendment approved during the debate specified that the
Treasury Department may use none of the funds appropriated for FY2005 to plan,
enter into, or implement contracts for collection of delinquent tax debt between the
IRS and private debt collectors. The House also approved amendments to prevent
any funds appropriated for FY2005 from being used to implement a directive from
the Office of Management and Budget known as Circular A-76 that requires federal
agencies to open up to competition from the private sector any functions or activities
that are not “inherently governmental,” and to prohibit the Treasury Department from
using appropriated funds for FY2005 to attempt to overturn a 2003 decision by a U.S.
district court that certain cash-balance pensions plans violate federal laws barring age
discrimination.
The Senate formally joined the deliberations in Congress over funding Treasury
operations in FY2005 when the Senate Appropriations Subcommittee on
Transportation, Treasury, and General Government approved an appropriations
measure (S. 2806) by voice vote on September 9, 2004. Five days later, the Senate
Appropriations Committee favorably reported the bill (S.Rept. 108-342) by a vote of

29-0. For a variety of reasons, the full Senate never voted on the bill.

Under S. 2806, as reported by the Appropriations Committee, Treasury’s
FY2005 budget would be set at $11.329 billion, or $228.9 million more than FY2004
but $286.1 million less than the amount requested by the Bush Administration for
FY2005. Nearly 90% of this amount, or $10.253 billion — which was $68.8 million
more than FY2004 but $421.1 million less than the amount requested for FY2005 —
would go to the IRS. The measure would also appropriate $161.3 million (or $13.7
million less than FY2004 and $23.7 million less than FY2005 budget request) for
departmental offices; $30.3 million (or $5.9 million less than FY2004 and $5.8
million less than the FY2005 budget request) for the department’s systems and
capital investments program; $16.1 million (or $3.2 million more than FY2004 and
$2.0 million more than the FY2005 budget request) for the Office of the Inspector
General; $129.1 million for the Treasury Inspector General for Tax Administration
($1.8 million more than FY2004 but identical to the FY2005 budget request); $2.0
million (or $523,000 less than FY2004 and $800,000 less than the budget request for
FY2005) for the Air Transportation Stabilization Program; $12.3 million (or $12.5
million less than FY2004 and $8.0 million less than the budget request for FY2005)
for Treasury’s Building and Annex Repair and Restoration Program; $72.5 million
(or $15.3 million more than FY2004 and $8.0 million more than the budget request
for FY2005) for FinCen; $230.9 million (or $3.7 million more than FY2004 and
identical to the budget request for FY2005) for the Financial Management Service;
$83.0 million (or $3.5 million more than FY2004 and $1.0 million more than the
budget request for FY2005) for the Alcohol and Tobacco Tax and Trade Bureau; and

$175.2 million (or $2.5 million more than FY2004 but identical to the budget request
for FY2005) for the Bureau of the Public Debt.
Contrary to the wishes of the Bush Administration, S. 2806 would also establish
a separate appropriation account for OFAC and set aside $22.3 million for its
operations in FY2005. (In FY2004, funding for OFAC was folded into the
appropriation for departmental offices.) Like H.R. 5025, S. 2806 supported the
Administration’s request to eliminate the initiative to expand access to financial
services and the violent crime reduction program by canceling unobligated balances
from previous fiscal years. But unlike H.R. 5025, the bill endorsed the creation of
OTFI and recommended that it receive $12.7 million in appropriated funds in
FY2005 and that the Treasury Secretary be given the authority to transfer up to $2.0
million in unobligated balances to the new office from the funds for departmental
offices.
The House and Senate finally agreed on a budget for the Treasury Department
in FY2005, in separate votes cast on November 20, 2004. It was included in a
broader appropriations measure (H.R. 4818, P.L. 108-447) known as the
Consolidated Appropriations Act, 2005, which covered nine of the 13 regular
appropriations bills. Funding for Treasury is set forth in Title II of Division H of the
Act. To keep total spending under H.R. 4818 within a discretionary spending limit
of $821.9 billion set by President Bush, the bill incorporates a 0.83 percent across-
the-board cut in all spending unrelated to national defense and homeland security.
President Bush signed the measure into law on December 8th.
A controversial provision (Section 222 of Title II, Division H) added to H.R.
4818 late in the conference negotiations that would permit the chairmen of the House
and Senate Appropriations Committees or designated members of their staff to have
access to “Internal Revenue Service facilities and any tax returns or return
information contained therein” delayed the signing of the bill. The provision did not
explicitly include criminal penalties for violating existing statutory protections of
taxpayer privacy for committee chairmen or their aides. Under current law, members
of the House Ways and Means Committee, Senate Finance Committee, and Joint
Committee on Taxation have the authority to examine tax return information, as well
as designated members of their staff. They face criminal and civil penalties if they
improperly disclose personal tax information obtained from their research or
carelessly lose tax return documents. Republican leaders in both houses agreed to
pass an enrolling resolution (H.Con.Res. 528) to delete the provision. The Senate
passed the resolution on November 21^st, and the House followed suit on December

6^th.

Under H.R. 4818, Treasury is to receive $11.248 billion in appropriated funds,
an amount that does not reflect the mandatory 0.83% across-the-board reduction in
spending. This total is $147.6 million more than the total enacted for FY2004 but
$362.0 million less than the amount requested by the Bush Administration. Virtually
all of this gain (91%) and this shortfall (98%) are tied to approved funding for the
IRS, which is set at $10.318 billion in FY2005, or $134.1 million above its funding
for FY2004. Other Treasury accounts receiving budgetary increases in FY2005 are
the Office of Inspector General ($16.5 million, or $3.6 million above FY2004), the
Treasury Inspector General for Tax Administration ($129.1 million, or $1.8 million

above FY2004), FinCen ($72.5 million, or $15.3 million above FY2004), the
Financial Management Service ($230.9 million, or $3.7 million above FY2004), the
Alcohol and Tobacco Tax and Trade Bureau ($83.0 million, or $3.5 million above
FY2004), and the Bureau of the Public Debt ($175.2 million, or $2.5 million above
FY2004). Three Treasury accounts are receiving less money than they did in
FY2004: Department-Wide Systems and Capital Investments Program ($32.3
million, or $3.9 million below FY2004), the Air Transportation Stabilization
Program ($2.0 million, or $0.5 million below FY2004), and Treasury Building and
Annex Repair and Restoration ($12.3 million, or $12.5 million below FY2004).
Contrary to the wishes of the Bush Administration, H.R. 4818 creates a separate
appropriations account for OFAC and gives it a budget of $22.3 million in FY2005,
with the caveat that the funds be used to establish the equivalent of 138 full-time staff
positions. The bill also appropriates $157.6 million for Treasury departmental
offices in FY2005 and eliminates programs to expand access to financial services
among low-income households and reduce violent crime by rescinding their
unobligated balances.
Internal Revenue Service (IRS). In order to help finance its operations and
programs, the federal government levies individual and corporate income taxes,
social insurance taxes, excise taxes, estate and gift taxes, customs duties, and
miscellaneous taxes and fees. The federal agency responsible for administering all
these taxes and fees, except customs duties, is the IRS. In discharging this duty, the
IRS receives and processes tax returns and other related documents, processes
payments and refunds, enforces compliance through audits and other methods,
collects delinquent taxes, and provides a variety of services to taxpayers to help them
understand their rights and responsibilities and resolve problems. In FY2003, the
IRS collected $1,969 billion before refunds, the largest component of which was
individual income tax revenue of $987 billion.
In FY2004, the IRS received $10.184 billion in appropriated funds. Of this
amount, $4.009 billion was used for processing, assistance, and management; $4.171
billion for tax law enforcement; $1.582 billion for information systems management;
$388 million for the business systems modernization program; and $35 million to
administer the health insurance tax credit established by the Trade Act of 2002. Of
the funds allocated to processing, assistance, and management, $4.1 million was
mandated for the Tax Counseling for the Elderly program and $7.5 million was set
aside to pay for grants for low-income taxpayer clinics. None of the funds
appropriated for the business systems modernization program could be spent without
the prior approval of the House and Senate Appropriations Committees. The IRS
was also barred from using appropriated funds from FY2004 to issue final
regulations lifting a moratorium on the conversion of corporate pension plans from
traditional defined-benefit plans to cash-balance plans imposed in 1999.
The Bush Administration requested that the IRS receive $10.674 billion in
funding for FY2005, or $490 million more than in FY2004. This amount was to be
allocated in the following manner: $4.148 billion for processing, assistance, and
management (an increase of $138 million over FY2004); $4.564 billion for tax law
enforcement (+$393 million over FY2004); $1.642 billion for information systems
management (+$60 million over FY2004); $285 million for the business systems
modernization program (-$103 million from FY2004); and $35 million for the

administration of the health insurance tax credit (virtually the same amount as
FY2004). According to budget documents issued by the IRS, this proposal was
intended to achieve three strategic goals: (1) continued improvement of taxpayer
service; (2) strengthened enforcement of the tax laws; and (3) continued
improvement of the IRS’s information infrastructure.
The budget proposal suggested that the Administration assigned a high priority
to improving compliance with tax laws. Public disclosures about illegal corporate
tax shelters and sharp declines in audit rates for high-income taxpayers and large
corporations in recent years have sparked heightened congressional scrutiny of
agency performance and strategic goals and calls inside and outside of Congress for
substantial increases in funding for tax law enforcement. The IRS estimates that the
overall gross tax gap in the 2001 tax year, the most recent year for which data are
available, amounted to $310.6 billion.¹⁴
A key player in the annual budget cycle for the IRS is the IRS Oversight Board.
Under the IRS Restructuring and Reform Act of 1998, the Board is required to
review the agency’s annual budget request, submit its own budget recommendation
to the Treasury Department, and determine whether the budget submitted by the
President to Congress is adequate to support the annual and long-term strategic plans
of the IRS.¹⁵ The Board recommended a budget of $11.204 billion for the IRS in
FY2005, an amount that would be 10% above the amount enacted for FY2004 and
5% above the amount requested by the Bush Administration for FY2005. It found
fault with the administration’s request on the grounds that it would produce a $230
million shortfall in light of the administration’s stated objectives of adding nearly
2,000 full-time employees to bolster IRS’s resources for tax law enforcement. In the
Board’s judgment, if Congress were to enact its recommended budget, the IRS would
be able to hire another 3,315 individuals in FY2005 to boost enforcement efforts and
eventually collect an additional $5 billion per year in revenue once the new
employees received proper training.¹⁶
Under H.R. 5025, as passed by the House in September 2004, the IRS would
receive $10.291 billion in funding in FY2005, or $107.3 million more than in
FY2004 but $382.5 million less than the amount requested by the Bush
Administration. The measure would funnel $4.072 billion into processing,
assistance, and management; $4.278 billion into tax law enforcement; $1.622 billion
into information systems; $285 million into business systems modernization; and
$34.8 million into administering the health insurance tax credit. About 75% of the
difference between the budget recommended in the bill and the Administration’s
requested budget was due to lower recommended funding for tax law enforcement.
In addition, H.R. 5025 would require the IRS to spend $7.5 million of the

¹⁴ The gross tax gap is simply the total amount of taxes owed for a given tax year but not
paid voluntarily or in a timely manner.
¹⁵ See 26 U.S.C. § 7802(d).
¹⁶ See testimony of Nancy Killefer of the IRS Oversight Board during a hearing held by the
House Ways and Means Oversight Subcommittee on March 30, 2004. Available at
[http://waysandmeans.house.gov/ ].

appropriated funds for processing, assistance, and management on low-income
taxpayer clinics and $4.1 million on the Tax Counseling Program for the Elderly.
Some of the amendments to H.R. 5025 approved during the floor debate in the
House would affect IRS operations in FY2005. One would prevent the IRS from
using any appropriated funds to plan, enter into, or implement contracts for collection
of delinquent individual income tax debt involving the IRS and private debt
collectors. As a result of the recently enacted American jobs Creation Act of 2004
(P.L. 108-357), the IRS has the authority to hire private debt collectors under certain
conditions for the purpose of collecting overdue taxes. Another amendment would
prohibit the IRS from using any appropriated funds to attempt to overturn a 2003
decision by a U.S. district court that certain cash-balance pension plans violate
federal laws barring age discrimination.
Under S. 2806 as reported by the Senate Appropriations Committee (but not
considered by the full Senate), IRS operations would be funded at $10.253 billion in
FY2005, or $68.8 million more than the FY2004 budget but $38 million less than the
amount recommended in H.R. 5025 and $421.1 million less than the amount
requested by the Bush Administration. The bill would allocate $4.107 billion for
processing, assistance, and management (of which $4.1 million would go to the Tax
Counseling Program for the Elderly and $7.0 million to low-income taxpayer clinics),
$4.519 billion for tax law enforcement, $1.606 billion for information systems, $125
million for business systems modernization, and $34.8 million for administering the
health insurance tax credit. In addition, the bill would rescind $140 million in
unobligated balances in the account for business systems modernization. In its report
on S. 2806, the Appropriations Committee expressed the concern that the IRS “has
consistently used the majority of its new compliance funding for purposes other than
those that Congress intended.” In order to insure that the agency uses most of the
funding it receives for tax law enforcement in FY2005 for programs intended to
improve compliance among high-income individuals and large corporations, the bill
would restrict the IRS’s ability to transfer funds from the tax law enforcement
account to 3% of the appropriated amount; transfers at higher levels would require
the prior consent of the House and Senate Appropriations Committees.
The House and Senate agreed on a budget for the IRS for FY2005 by passing
an omnibus appropriations bill (H.R. 4818) in separate votes on November 20, 2004.
Under the measure, the IRS would receive a total of $10.319 billion, or $134.1
million more than in FY2004 but $355.8 million less than the amount requested by
the Bush Administration. More than 46% of this latter difference is due to reduced
levels of spending on tax law enforcement. The measure appropriates $4.089 billion
for processing, assistance and management ($80.3 million above FY2004), $4.399
billion for tax law enforcement ($227.5 million above FY2004), $1.590 billion for
information systems ($8.9 million above FY2004), $205.0 million for business
systems modernization ($182.7 million below FY2004), and $34.8 million for
administering the health insurance tax credit ($47 million above FY2004). In
addition, H.R. 4818 specifies that the IRS spend $4.1 million of the funds
appropriated for processing, assistance and management on tax counseling for the
elderly and $8.0 million on low-income taxpayer clinics, and that the IRS
Commissioner submit quarterly reports to the House and Senate Appropriations
Committees on the agency’s compliance activities. The measure does not contain the

contentious provision in the House-passed version of H.R. 5025 barring the IRS from
spending any appropriated funds on the outsourcing of certain individual tax debt
collection to the private sector.
The decision not to fully fund the Bush Administration’s budget request for the
IRS is being met with disapproval by some inside and outside Congress. These
critics are mainly concerned that the agency will lack the resources needed to address
its highest short-term priorities, including better service to taxpayers, improved
compliance, and a more modern information system.
Title III: Executive Office of the President and Funds
Appropriated to the President
Table 7. Title III: Executive Office of the President (EOP) and
Funds Appropriated to the President Appropriations
(millions of dollars)
^Offi^ce^FY²⁰⁰⁴^Ena^c^t^e^d*^FY²⁰⁰⁵^Request^FY²⁰⁰⁵^Hou^s^e^FY²⁰⁰⁵^Sena^t^e^FY²⁰⁰⁵^Ena^c^t^e^d*^*
^C^o^m^p^en^s^a^tⁱ^oⁿ^of^t^h^{e Pres}ⁱ^d^en^t^$0.5^—^$0.5^$0.5^$0.5
^T^h^{e W}^h^{ite Hou}^s^{e Of}^fⁱ^{ce (s}^alaries
^an^{d ex}^pen^s^es⁾^68.8^—^60.0^63.7^62.0
^Ho^m^e^lan^d^Secu^rity^Co^uⁿ^c^il^—^—²^.⁵^—^—
^Ex^ecu^tiv^{e R}^e^sⁱ^den^{ce at th}^{e W}^h^ite
^H^o^u^s^{e (operat}ⁱⁿ^g^ex^pen^s^es⁾^12.4^—^12.8^12.8^12.8
^W^h^{ite Ho}^u^s^{e Rep}^a^ir^an^d
^R^e^s^t^oratⁱ^oⁿ⁴^.2^—^1.9¹^.9^1.9
^C^o^uⁿ^cⁱ^l^of^Econ^omⁱ^c^A^d^vⁱ^s^o^rs^4.5^—^4.0⁴^.0^4.0
^O^f^fⁱ^{ce of}^Polⁱ^c^y^D^e^v^e^l^opm^en^t⁴^.1^—^2.3²^.4^2.3
^Natioⁿ^a^{l Secu}^r^ity^Co^uⁿ^c^il¹⁰^.⁵^—⁸^.⁹⁸^.9⁸^.⁹
^O^f^fⁱ^{ce of}^A^d^mⁱⁿⁱ^s^t^ratⁱ^oⁿ^82.3^—^92.7^92.9^92.3
^T^h^{e Wh}ⁱ^t^e^H^o^u^s^e^—^$181.0^—^—^—
^O^f^fⁱ^{ce of}^Man^a^g^e^m^eⁿ^t^an^{d Bu}^dg^et^66.8^76.6^67.8^68.4^68.4
^O^ffi^c^e^o^f^N^a^tⁱ^o^na^l^D^r^{ug Co}^nt^r^o^l
^Polⁱ^c^y^(s^al^ari^e^s^an^{d ex}^pen^s^es⁾^27.8^27.6^28.1^27.0^27.0
^O^ffi^c^e^o^f^N^a^tⁱ^o^na^l^D^r^{ug Co}^nt^r^o^l
^P^o^lⁱ^c^y^Co^unt^e^r^d^r^{ug T}^e^c^hno^l^o^gy
^A^s^s^e^s^s^m^en^t^C^eⁿ^t^er^41.8^40.0^30.0^42.0^42.0
^Fe^d^e^r^a^l^D^r^{ug Co}^nt^r^o^l^P^r^o^g^r^a^m^s^:
^Hⁱ^{gh I}ⁿ^t^e^nsi^t^y^D^r^{ug T}^r^a^ffi^c^kⁱⁿ^g
^A^r^eas^P^r^og^ram^225.0^208.4^215.4^228.4^228.4
^Fe^d^e^r^a^l^D^r^{ug Co}^nt^r^o^l^P^r^o^g^r^a^m^s^:
^O^t^h^e^{r Prog}^ram^s^227.6^235.0^195.0^195.5^213.7
^Of^fⁱ^{ce of}^th^{e Vice P}^r^es^iden^t
^(s^alaries^an^{d ex}^pen^s^es⁾⁴^.4^4.6⁴^.6^4.6⁴^.6
^Of^fⁱ^{cial R}^e^sⁱ^den^{ce of}^th^{e Vice}
^Presⁱ^d^en^t^(operatⁱⁿ^g^ex^pen^s^es⁾⁰^.3^0.3⁰^.3^0.3⁰^.3
^To^t^a^{l, EO}^P^a^{nd F}^unds
^A^p^p^r^op^ri^ated^{to th}^{e Pres}ⁱ^d^en^t^782.0^774.5^727.2^754.2^770.0

^S^o^u^rce:^Fig^u^re^s^a^r^e^f^r^om^a^budg^e^t^a^u^thority^ta^ble^prov^ide^d^by^the^H^ous^e^Com^m^itte^e^{on A}^ppropria^tions^{. B}^ecau^se
^of^dif^f^e^ring^tre^a^t^m^e^{nt of}^of^f^s^e^t^{s, the}^tota^{ls w}^{ill not}^a^l^w^a^y^s^m^a^tc^{h the}^A^d^mⁱ^nistra^{tion’s tota}^{ls. T}^h^e^fⁱ^g^u^re^s^w^ithin
^this^ta^ble^m^a^y^dif^f^e^r^s^lig^htly^f^r^om^thos^e^{in the}^te^x^t^due^{to s}^upple^m^eⁿ^ta^{l a}^ppr^opr^ia^tions,^r^e^sci^ssi^oⁿ^s^{, a}^{nd othe}^r
^f^unding^a^c^tions^{. C}^o^lumⁿ^s^m^a^y^{not a}^{dd due}^{to r}^ounding^or^e^x^c^l^us^{ion of}^s^m^a^lle^r^pr^og^r^a^m^line^-^ite^m^s^.
^*^FY^{2004 f}ⁱ^g^u^r^e^s^r^e^f^l^e^c^t^aⁿ^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^{on of}^0.59%^.
^*^*^F^Y^{2005 f}ⁱ^g^u^r^e^s^{do not r}^e^f^l^e^c^t^aⁿ^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^{on of}^0.80%^.
The Transportation, Treasury, and Independent Agencies Appropriations Act
funds all but three offices in the Executive Office of the President (EOP). Of the
three exceptions, the Council on Environmental Quality and Office of Environmental
Quality, and the Office of Science and Technology Policy are funded under the
Veterans Affairs, Housing and Urban Development, and Independent Agencies
appropriations; and the Office of the United States Trade Representative is funded
under the Commerce, Justice, State, the Judiciary and Related Agencies
appropriations.
The President’s FY2005 budget proposed to consolidate and financially realign
several annual EOP salaries and expenses appropriations that directly support the
President into a single annual appropriation, called “The White House.” This
consolidated appropriation would total $181.0 million in FY2005, a decrease of 3.3%
from the $187.2 million appropriated in FY2004, after the 0.59% rescission,¹⁷ for the
accounts proposed to be consolidated. The accounts included in the consolidated
appropriation would be as follows:
^!Compensation of the President
^!White House Office (including the Homeland Security Council)
^!Executive Residence at the White House
^!White House Repair and Restoration
^!Office of Policy Development
^!Office of Administration
^!Council of Economic Advisers
^!National Security Council
According to the FY2005 budget, the consolidation “initiative provides enhanced
flexibility in allocating resources and staff in support of the President and Vice¹⁸
President, and permits more rapid response to changing needs and priorities.”
The Administration proposed similar consolidations in the FY2002, FY2003,
and FY2004 budgets, but the conference committees for the Treasury and General
Government Appropriations Act, 2002 (P.L. 107-67) and 2003 (P.L. 108-7, Division
J), and the Transportation, Treasury, and Independent Agencies Appropriations Act,
2004 (P.L. 108-199, Division F), decided to continue with separate appropriations
for the EOP accounts. The Administration reportedly sought to eliminate the

¹⁷ P.L. 108-199, Consolidated Appropriations Act for FY2004, at Division H, Section 168
required a 0.59% across the board rescission in non-defense discretionary spending
accounts. The FY2004 appropriation for the EOP accounts proposed to be consolidated
totaled $188.332 million before the rescission.
¹⁸ U.S. Executive Office of the President, Office of Management and Budget, Budget of the
United States Government Fiscal Year 2005 Appendix (Washington: GPO, 2004), p. 952.
(Hereafter referred to as FY2005 Budget, Appendix.)

“needless complexity [of different accounts] that adds expense, that adds burdens,
that adds administrative hurdles that they must go through to accomplish anything.”¹⁹
Congressional concern about this proposed consolidation has centered on Congress’s
“legitimate needs and desires to have oversight over spending of public funds.”²⁰
Proposed in the FY2005 budget request for consolidation was a Title VI general
provision (a similar provision was proposed in FY2004) that would provide authority
for the EOP to transfer 10% of the appropriated funds among the following accounts:
^!The White House (Compensation of the President, White House
Office (including the Homeland Security Council), Executive
Residence at the White House, White House Repair and Restoration,
Office of Policy Development, Office of Administration, Council of
Economic Advisers, National Security Council)
^!Office of Management and Budget (OMB)
^!Office of National Drug Control Policy
^!Special Assistance to the President and Official Residence of the
Vice President (transfers would be subject to the approval of the
Vice President)
^!Council on Environmental Quality and Office of Environmental
Quality
^!Office of Science and Technology Policy
^!Office of the United States Trade Representative²¹
According to the EOP budget submission, the transfer authority would “allow
the President to address, in a limited way, emerging priorities and shifting demands”
and would “provide the President with flexibility, improve the efficiency of the EOP,
and reduce administrative burdens.”²²
In the first session of the 108^th Congress, the conference agreement
accompanying the FY2004 Consolidated Appropriations Act provided that separate
appropriations for the EOP accounts be continued and that the transfer authority
proposal not be accepted. For the FY2005 appropriations for the EOP, the House
Committee on Appropriations recommended, the House passed, and the Senate
Committee on Appropriations recommended the same. According to the committee
report accompanying the Senate bill:
The Committee recommends funding for the offices that directly support the
President according to the existing structure of accounts. This arrangement has

¹⁹ Rep. Ernest Istook, then chairman of the Subcommittee on Treasury, Postal Service and
General Government of the House Committee on Appropriations, discussing the FY2002
proposal for consolidation of the Executive Office of the President accounts. Congressional
Record, daily edition, July 25, 2001, p. H4570.
²⁰ Ibid.
²¹ FY2005 Budget, Appendix, p. 952. U.S. Executive Office of the President, Fiscal Year
2005 Congressional Budget Submission (Washington: GPO [Feb. 2004]), p. 3. (Hereafter
referred to as EOP Budget Submission.)
²² EOP Budget Submission, p. 3.

served the Committee’s and the public’s need for transparency in the funding and
operation of these important functions while also providing the executive branch
with the flexibility it needs to reprogram funds within accounts to address
unforseen budget needs. As noted in discussions with administration officials
in past years, at no time has the Committee rejected an administration’s request
to reprogram existing funds within these accounts.
The conference agreement and the Consolidated Appropriations Act for FY2005
authorizes the transfers, but continues separate appropriations for the EOP accounts.
With regard to the transfers, Section 533 of Title V of Division H of the Consolidated
Appropriations Act provides that up to 10% of the appropriated funds among the
accounts for the
^!White House Office (including the Homeland Security Council),
Executive Residence at the White House, White House Repair and
Restoration, Office of Policy Development, Office of
Administration, Council of Economic Advisers, National Security
Council
^!Office of Management and Budget
^!Office of National Drug Control Policy
^!Special Assistance to the President and Official Residence of the
Vice President (transfers would be subject to the approval of the
Vice President)
could be transferred to any other such appropriation, “to be merged with and
available for the same time and for the same purposes as the appropriation to which
transferred” by the OMB Director (or such other officer as the President may
designate in writing). The House and Senate Committees on Appropriations must
receive 15 days notice of the transfer from the OMB Director. The amount of an
appropriation cannot be increased by more than 50% by such transfers.
EOP Offices Funded Through Treasury and General
Government Appropriations²³
The President’s FY2005 budget for EOP programs funded under the Treasury
and General Government appropriations proposed an appropriation of $774.5
million, a decrease of 1% from the $782.0 million appropriated in FY2004, after the²⁴
0.59% rescission. The FY2005 budget proposals for specific accounts (see Table

7) are discussed below.

Compensation of the President. The President’s FY2005 budget proposed
an appropriation of $450,000, which includes an expense allowance of $50,000. This
is the same amount as was appropriated in FY2004. The salary of the President is
$400,000 per annum, effective January 20, 2001. The House and Senate Committees

²³ Except as otherwise indicated, amounts proposed in the FY2005 budget are taken from
the EOP Budget Submission.
²⁴ The FY2004 appropriation for the EOP accounts totaled $786.6 million before the
rescission.

on Appropriations recommended, the House passed, and the conference agreement
and the law provide the same amount as the President requested.
White House Office (WHO). This account provides the President with staff
assistance and administrative services.
The President’s FY2005 budget proposed an appropriation of $63.7 million. The
FY2004 appropriation was $69.2 million, but after the 0.59% rescission was $68.8
million. The requested amount is 7.4% less than the FY2004 funding after the
rescission. For FY2005, the WHO will participate in the White House Core
Enterprise Pilot Program, under which the Office of Administration (OA) centrally
manages certain operations in an effort to achieve cost savings and administrative
efficiencies. Costs associated with rent payments to the General Services
Administration (GSA) ($8.2 million) and after-hours utilities use ($243,000) will be
realigned to the OA and, if the pilot program is successful, the costs will be
permanently realigned to that office.²⁵
The WHO request also included the transfer of the annual budget for
audiovisual support associated with Presidential Diplomatic Missions ($534,000) to
the Department of State.
The House Committee on Appropriations recommended and the House passed
an appropriation of $59.5 million. Of this amount, $8.3 million would be available
for reimbursements to the White House Communications Agency. The
recommended funding is $4.2 million less than the President’s request. According
to the committee report that accompanies the House bill, the $4.2 million is the
amount the President proposed for the Homeland Security Council (HSC) as part of
the WHO appropriation. The Committee funds the HSC as a separate appropriation
(see below).
The Senate Committee on Appropriations recommended the same amount as the
President requested ($63.7 million). No more than $9.975 million of this amount
would be available for reimbursements to the White House Communications Agency.
The conference agreement and the law provide an appropriation of $62 million,
which is $1.7 million less than the President’s request. After the 0.80% rescission,
the FY2005 funding is $61.5 million, a reduction of $2.2 million from the
President’s request. Reimbursements to the White House Communications Agency
are provided at the level recommended by the Senate Committee on Appropriations.
Homeland Security Council (HSC). The Homeland Security Council
provides support and advice to the President and interagency coordination of all
aspects of homeland security, including the implementation of the National Strategy
for Homeland Security. The HSC’s funding is included in the White House Office
request, but the EOP budget submission does not specify the amount requested for
allocation to the council in FY2005. (The House Appropriations Committee report
accompanying the House bill states that the President proposed an appropriation of

²⁵ EOP Budget Submission, p. 30.

$4.173 million for the HSC.) The FY2004 appropriation for the HSC was $7.23
million, but after the 0.59% rescission was $7.19 million.
The House Committee funds the HSC as a separate appropriation, thereby
treating it the same as the National Security Council and other policy-related offices
for budgetary purposes. The Committee recommended and the House passed an
appropriation of $2.475 million. This amount is $1.7 million less than the
President’s request. According to the committee report, “The recommended
reduction reflects the unobligated balance in this account, which can be partially
applied to offset FY2005 activities.”²⁶ The report also expresses concern that the
HSC did not provide the Committee with a definitive request for staffing or
budgetary resources for FY2005 and notes that the appropriations hearing record
reflected 66 staff for the council — approximately 40 full-time equivalent staff years
as direct hires and 26 detailees. The Committee states that this approximate staffing
level would be significantly above the May 2004 onboard staffing level and tells the
EOP that “budget-quality estimates rather than approximations” will be expected in
future budget submissions. Finally, the report expresses the Committee’s concern
about the council’s high travel budget, particularly “the high proportion that is
applied to travel within the Washington, DC metropolitan area,” and states that the
Committee will work with the council to reduce these costs.²⁷
The Senate Committee on Appropriations includes the HSC’s funding in the
White House Office request and does not specify the amount requested for allocation
to the council in FY2005. The conference agreement states that the Senate bill
assumed funding of $4.173 million.²⁸
The conference agreement and the law provide an appropriation of $2.475
million and include the funding under the White House Office. This amount is $1.7
million less than the President’s request. After the 0.80% rescission, the FY2005
funding is $2.455 million.
Executive Residence at the White House and White House Repair
and Restoration. These accounts provide for the care, maintenance, and operation
of the Executive Residence and its repair, alteration, and improvement.
The President’s FY2005 budget proposed an appropriation of $12.8 million for
the executive residence. The FY2004 appropriation was $12.5 million, but after the
0.59% rescission was $12.4 million. The requested amount is 2.7% more than the
FY2004 funding after the rescission. The House and Senate Committees on
Appropriations recommended, the House passed, and the conference agreement and
the law provide the same amount as the President requested. After the 0.80%
rescission, the FY2005 funding is $12.7 million, a reduction of $100,000 from the
President’s request.

²⁶ H.Rept. 108-671, p. 129.
²⁷ Ibid.
²⁸ Congressional Record, daily edition, vol. 150, Nov. 19, 2004, p. H10819.

For repair and restoration of the White House, the budget proposed an
appropriation of $1.9 million. The FY2004 appropriation was $4.2 million after the
0.59% rescission. The requested amount is 55% less than the FY2004 funding after
the rescission. The EOP budget submission stated that the repair and restoration
funding would be used to replace the existing cooling towers and associated
electrical, mechanical, and control equipment ($1.7 million); and, with the possible
change of Administration in 2005, to move and pack items for the outgoing First
Family and set up the living quarters for the incoming First Family ($100,000); and
redecorate the living quarters in the White House ($100,000).²⁹
The House and Senate Committees on Appropriations recommended, the House
passed, and the conference agreement and the law provide the same amount as the
President requested. After the 0.80% rescission, the FY2005 funding is $1.885
million, a reduction of $15,000 from the President’s request.
Maintenance and repair costs for the White House are also funded by the
National Park Service as part of that agency’s responsibility for national monuments.
Entertainment costs for state functions are funded by the Department of State.
Reimbursable political events in the Executive Residence are to be paid for in
advance by the sponsor, and all such advance payments are to be credited to a
Reimbursable Expenses account. The political party of the President is to deposit
$25,000 to be available for expenses relating to reimbursable political events during
the fiscal year. Reimbursements are to be separately accounted for and the
sponsoring organizations billed, and charged interest, as appropriate. The staff of the
Executive Residence must report to the Committees on Appropriations, after the
close of each fiscal year, and maintain a tracking system on the reimbursable
expenses.
Council of Economic Advisers (CEA). The three-member council was
created in 1946 to assist and advise the President in the formulation of economic
policy. The council analyzes and evaluates the national economy, economic
developments, federal programs, and federal policy to formulate economic advice.
The council assists in the preparation of the annual Economic Report of the President
to Congress.
The President’s FY2005 budget proposed an appropriation of $4.040 million.
The F2004 appropriation was $4.5 million after the 0.59% rescission. The requested
amount is 9.7% less than the FY2004 funding after the rescission. For FY2005, the
CEA will participate in the White House Core Enterprise Pilot Program. Costs
associated with rent payments to the GSA ($683,000), after-hours utilities use
($4,000), and prorated Medical Unit costs ($4,000) will be realigned to the OA and,
if the pilot program is successful, the costs will be permanently realigned to that
office.³⁰
The House and Senate Committees on Appropriations recommended, the House
passed, and the conference agreement and the law provide the same amount as the

²⁹ EOP Budget Submission, p. 49.
³⁰ EOP Budget Submission, p. 109.

President requested. After the 0.80% rescission, the FY2005 funding is $4.008
million, a reduction of $32,000 from the President’s request. During consideration
of its version of the appropriations bill, the House, by voice vote, agreed to an
amendment (incorporated at Section 643) offered by Representative Sherrod Brown
to provide that “None of the funds made available in this act may be used by the
[CEA] to produce an Economic Report of the President regarding the inclusion of
employment at a retail fast food restaurant as part of the definition of manufacturing
employment.”³¹ This provision is Section 524 of Title V of Division H of the
Consolidated Appropriations Act for FY2005.
Office of Policy Development. The Office supports and coordinates the
Domestic Policy Council (DPC) and the National Economic Council (NEC) in
carrying out their responsibilities to advise and assist the President in formulating,
coordinating, and implementing economic and domestic policy, and other policy
initiatives.
The President’s FY2005 budget proposed an appropriation of $3.6 million. The
FY2004 appropriation was $4.1 million. The requested amount is 12.1% less than
the FY2004 funding after the rescission. The EOP budget submission did not specify
the amounts that would be allocated to the Office of Policy Development’s DPC and
NEC functions. For FY2005, the Office of Policy Development will participate in
the White House Core Enterprise Pilot Program. Costs associated with rent payments
to the GSA ($482,000) and after-hours utilities use ($7,000) will be realigned to the
OA and, if the pilot program is successful, the costs will be permanently realigned³²
to that office.
The House Committee on Appropriations recommended and the House passed
an appropriation of $2.267 million. This amount is $1.3 million less than the
President’s request. According to the committee report accompanying the House bill,
“The reduction reflects current unobligated balances in this account appropriated as³³
far back as FY2000 ... [which] can be applied to FY2005 requirements.” The
Senate Committee on Appropriations recommended an appropriation of $2.4 million
which is $1.2 less than the President’s request. The committee report accompanying
the Senate bill states that the recommendation was “based on the amount of funding³⁴
that has lapsed in this account in recent years.”
The conference agreement and the law provide an appropriation of $2.3 million,
which is $1.3 million less than the President’s request. After the 0.80% rescission,
the FY2005 funding is $2.282 million, likewise, a reduction of $1.3 million from the
President’s request.

³¹ Congressional Record, daily edition, vol. 150, Sept. 15, 2004, p. 7207.
³² EOP Budget Submission, p. 84.
³³ H.Rept. 108-671, p. 128.
³⁴ S.Rept. 108-342, p. 161.

National Security Council (NSC). The NSC advises the President on
integrating domestic, foreign, military, intelligence, and economic policies relating
to national security.
The President’s FY2005 budget proposed an appropriation of $8.932 million.
The FY2004 appropriation was $10.6 million, but after the 0.59% rescission was
$10.5 million. The requested amount is 14.8% less than the FY2004 funding after
the rescission. Of the total amount requested, $574,000 would fund the President’s³⁵
Foreign Intelligence Advisory Board (PFIAB). For FY2005, the NSC will
participate in the White House Core Enterprise Pilot Program. Costs associated with
rent payments to the GSA ($1.7 million), after-hours utilities use ($45,000), and
prorated Medical Unit costs ($5,000) will be realigned to the OA and, if the pilot
program is successful, the costs will be permanently realigned to that office. The
PFIAB requests realignment of rent payments ($168,000) and communications,³⁶
utilities, and miscellaneous charges ($4,000) to the OA.
The House and Senate Committees on Appropriations recommended, the House
passed, and the conference agreement and the law provide the same amount as the
President requested. After the 0.80% rescission, the FY2005 funding is $8.861
million, a reduction of $71,000 from the President’s request. The committee report
accompanying the House bill notes that “The number of full-time equivalent staff
years remains at the FY2004 enacted level of 71.”³⁷
Office of Administration (OA). The Office of Administration provides
administrative services, including information technology; human resources
management; library and records management; financial management; and facilities,
printing, and supply, to the Executive Office of the President.
The President’s FY2005 budget proposed an appropriation of $85.7 million. The
FY2004 appropriation was $82.8 million, but after the 0.59% rescission was $82.3
million. The requested amount is 4.1% more than the FY2004 funding after the
rescission. Of the total amount requested, $73.6 million is for salaries and expenses;
$1.1 million is for cyber security needs; and $12.1 million is for the capital
investment plan (CIP). Among the monies in the CIP are $2.0 million for customer
service and desktop systems and $700,000 for information security. The offsite data
center will be fully operational by FY2005 and funding of $6.0 million for the center
will be transferred from the capital investment plan to the salaries and expenses
budget.³⁸
The House Committee on Appropriations recommended and the House passed
an appropriation of $92.7 million. This amount is $7 million more than the
President’s request. Of the total, $12.1 million would fund the CIP for continued
modernization of the information technology infrastructure within the EOP. Four

³⁵ EOP Budget Submission, p. 101.
³⁶ EOP Budget Submission, pp. 93-94.
³⁷ H.Rept. 108-671, p. 128.
³⁸ EOP Budget Submission, pp. 56-59 and 68-69.

million of the CIP funds could not be obligated until the EOP has submitted a report
to the Committees on Appropriations that includes an Enterprise Architecture that is
reviewed and approved by OMB, reviewed by the GAO, and approved by the
Committees on Appropriations. The Committee would restore the Office of
Management and Budget (OMB) to the White House Core Enterprise Pilot Program
and transfer $8.3 million from the OMB appropriation to the OA appropriation.
According to the committee report accompanying the House bill, the Committee
continues to believe that the OA, under the enterprise pilot program, should make
rental payments and pay other administrative expenses for EOP offices, including
OMB.
The Senate Committee on Appropriations recommended an appropriation of
$92.9 million which is $7.2 million more than the President’s request. Continued
modernization of the information technology infrastructure within the EOP through
the CIP would be funded at $12.1 million. The Core Enterprise Services Program
would receive funding of $18.5 million. The committee report accompanying the
Senate bill states that “The budget request
proposes to transfer non-discretionary GSA rent and rent-related costs from
White House Offices, Office of Policy Development, Council of Economic
Advisors, and National Security Council to the Office of Administration to
provide for central management. To achieve greater administrative and cost
efficiencies, the Committee has included the Office of Management and Budget
in the core enterprise services program and funding above the budget estimate
represents OMB’s costs for rent, after-hours utilities, and prorated costs of health³⁹
unit operations.
The conference agreement and the law provide an appropriation of $92.3
million, which is $6.6 million more than the President’s request. After the 0.80%
rescission, the FY2005 funding is $91.5 million, an increase of $5.8 million above
the President’s request. Funding for the CIP is provided at the level recommended
by the House and Senate Committees. Four million of the CIP funds could not be
obligated until the reporting requirements discussed above are met.
Chief Financial Officer (CFO). The Chief Financial Officer oversees all
financial management activities of the EOP. The CFO directs, manages, and
provides policy guidance and oversight of the financial management personnel under
the EOP. Funding of $5.1 million for the CFO is included in the Office of
Administration’s request. This amount is 1.4% more than the $5.0 million provided
in FY2004 after the 0.59% rescission. Among other items, this amount “continues
funding for travel expenses associated with business management and information
technology support for Presidential and Vice Presidential travel.”⁴⁰ The House and
Senate Committees on Appropriations did not state, and neither do the conference
agreement or the law, what portion of the OA appropriation would be allocated to the
CFO.

³⁹ S.Rept. 108-342, p. 161.
⁴⁰ EOP Budget Submission, p. 76.

Office of Management and Budget (OMB). OMB assists the President
in discharging budgetary, management, and other executive responsibilities. The
agency’s activities include preparing the budget documents; examining agency
programs, budget requests, and management activities; preparing the government-
wide financial management status report and five-year plan (with the Chief Financial
Officer Council); reviewing and coordinating agency regulatory proposals and
information collection requirements; and promoting economical, efficient, and
effective procurement of property and services for the executive branch.
The President’s FY2005 budget proposed an appropriation of $76.6 million. The
FY2004 appropriation was $67.2 million, but after the 0.59% rescission was $66.8
million. The requested amount is 15% more than the FY2004 funding after the
rescission. However, according to the EOP budget submission, after OMB’s FY2004
budget is adjusted to restore $8.2 million (the House Committee states the amount
as $8.3 million) to the Office of Administration for the White House Core Enterprise
Pilot Program, the increase over the FY2004 amount is 2.1%. The submission also
stated that the request “includes only the resources needed to maintain existing
staffing levels and capabilities .... No new initiatives are proposed.”⁴¹
The House Committee on Appropriations recommended, and the House passed,
an appropriation of $67.8 million, of which up to $1,500 would be available for
official representation expenses. This amount is $8.8 million less than the
President’s request. The House bill would provide that none of the funds
appropriated or made available could be used for any of the following purposes: to
review any agricultural marketing orders or any activities or regulations under the
Agricultural Marketing Agreement Act of 1937, to alter the transcript of actual
testimony of witnesses, except for the testimony of OMB officials, before the
Committees on Appropriations or their subcommittees (this provision would not
apply to printed hearings released by the Committees on Appropriations), and to pay
the salary or expenses of any OMB employee who calculates, prepares, or approves
any tabular or other material that proposes the sub-allocation of budget authority or
outlays by the Committees on Appropriations among their subcommittees. The
Committee’s recommended appropriation includes adjusting OMB staffing to a level
of 500 full-time equivalents (FTEs). The report accompanying the House bill states
that the Committee reviewed hearing data and found that OMB requested excess
staffing funds for at least the last two years. OMB used 491 FTE in FY2003 and told
the Committee that the FY2004 request for 510 FTE included “no new staff.” OMB’s
FY2005 budget estimate assumes that the FY2004 full-time equivalent (FTE) staffing
level of 510 would be continued. According to the Committee, actual on-board
employment at OMB was 491 as of June 1, 2004. The Committee believes that this
indicates that the FY2004 budget estimate “was more than needed to maintain a
constant staffing level” and that the same would apply for the FY2005 estimate.⁴²
The committee report addresses several other issues related to OMB’s
appropriation as follows. The funding for the Financial Accounting Standards
Advisory Board (FASAB) and the Joint Financial Management Improvement

⁴¹ EOP Budget Submission, p. 144.
⁴² H.Rept. 108-671, p. 130.

Program (JFMIP) would be retained in the OMB account because the Committee
believes that “budget and program accountability and control should go together
wherever possible.”⁴³ The President’s budget proposed transferring OMB’s portion
of the funding for the FASAB and the JFMIP to the Department of the Treasury, but
keeping the “lead responsibility” for the activities with OMB. At present, a member
of the Senior Executive Service is on detail from the National Aeronautics and Space
Administration (NASA) to the federal enterprise architecture program management
office at OMB. The Committee believes that the employee should return to NASA
and the office should be closed because it questions whether a one-person office
could have an appreciable impact on the development of government-wide
information technology policy.
As discussed under the Office of Administration account above, $8.3 million
would be transferred to the OA account for the White House Core Enterprise Pilot
Program to be used to make rental payments and pay other administrative expenses
for EOP offices. After reviewing spending from previous years, the Committee again
limits reception and representation expenses to $1,500. Also, within 90 days of the
act’s enactment, OMB is directed by the Committee to provide
a report detailing its blueprint and master plan for realizing substantive
reductions in regulatory burdens on industries, which, if achieved, will result in
true savings regardless of system efficiencies. The report should identify
regulatory areas with the greatest time, cost and volume burden, and note how
OMB’s blueprint and master plan addresses these areas for substantive reduction.
The Committee recommends that OMB first direct its reduction efforts at
regulations where the greatest gain can be achieved with the least effort. The
Committee considers paperwork reduction to be especially crucial in the area of
health care ... The Committee strongly encourages OMB to give priority attention
to the health care area for reducing the paperwork burden on hospitals and
physicians and their staffs .... OMB is urged to convene and coordinate the
government-wide task force that includes industry representatives to examine the
original intent of the underlying laws ... and determine where regulations could⁴⁴
be coordinated and simplified to reduce costs and regulatory burdens ... .
The Senate Committee on Appropriations recommended an appropriation of
$68.4 million, of which up to $3,000 would be available for official representation
expenses. This amount is $8.2 million less than the President’s request. The Senate
bill would provide that none of the funds appropriated or made available could be
used for any of the following purposes: to review any agricultural marketing orders
or any activities or regulations under the Agricultural Marketing Agreement Act of
1937, to alter the transcript of actual testimony of witnesses, except for the testimony
of OMB officials, before the Committees on Appropriations or the Committees on
Veterans’ Affairs, or their subcommittees (this provision would not apply to printed
hearings released by the Committees on Appropriations or the Committees on
Veterans’ Affairs), and to pay the salary or expenses of any OMB employee who
calculates, prepares, or approves any tabular or other material that proposes the sub-

⁴³ Ibid, p. 131.
⁴⁴ Ibid., pp. 131-132.

allocation of budget authority or outlays by the Committee on Appropriations among
their subcommittees.
Additionally, the Senate bill would provide that none of the funds provided in
this act, in prior acts, or in subsequent acts would be used, directly or indirectly, by
OMB to evaluate or determine if water resource project or study reports submitted
by the Chief of Engineers acting through the Secretary of the Army are in compliance
with all applicable laws, regulations, and requirements relevant to the Civil Works
water resource planning process. OMB would have not more than 60 days to
perform budgetary policy reviews of water resource matters on which the Chief of
Engineers has reported. The OMB Director would notify the appropriate authorizing
and Appropriations Committees when the 60-day review is initiated. If water
resource reports have not been transmitted to the appropriate authorizing and
appropriating committees within 15 days of the end of the OMB review period based
on the notification from the director, Congress would assume OMB concurrence with
the report and act accordingly. The committee report accompanying the Senate bill
explains the need for these provisions related to OMB review of water resource
projects. According to the Committee, it is
aware that numerous water resource projects that have been fully vetted through
the lengthy water resource planning process established by the executive branch
are being held up by the [OMB] for technical reviews or other policy questions
that are unrelated to budgetary matters. The Committee has found that OMB
does not have the proper staffing or expertise to make these types of decisions.
In addition, the Committee is deeply concerned that water resource matters are
being unnecessarily delayed for extended periods of time, sometimes without⁴⁵
further action ever being taken because of such obstinacy.
The committee report accompanying the Senate bill addresses several issues
related to OMB’s funding as follows. OMB’s request to transfer funding for the
Federal Accounting Standards Advisory Board (FASAB) and the Joint Financial
Management Improvement Program (JFMIP) to the Department of the Treasury is
denied. According to the Committee
The justification for consolidating OMB’s annual payments to FASAB and
JFMIP in the Treasury Department is exceptionally weak and rests on the desire
to include the expense in the organization where the services are contracted
rather than in the organization that initiates the expense. This proposal is
inconsistent with the manner in which similar payments are treated in other
agencies’ budgets and leaves the impression that the transfer of these payments
is being requested to mask the actual amount of resources for fiscal year 2005.⁴⁶
The recommendation assumes an adjustment of $639,000.
As for the Core Enterprise Services Program, “The Committee recommendation
transfers $7,193,000 back to the Office of Administration to consolidate OMB’s rent,
after-hour utilities, and health unit costs in the ... program.” The committee report
states that “Keeping as many entities in the ... program reduces the number of

⁴⁵ S.Rept. 108-342, p. 163.
⁴⁶ Ibid., pp. 162-163.

individual bills that have to be processed and reconciled, reduces the administrative
burden on preparing additional interagency agreements, and also reduces the
duplicate administrative structures inherent in a decentralized environment.”⁴⁷
Because of budget constraints, the Committee defers $1.6 million requested “to
hire additional personnel to reach the currently authorized level of full-time
equivalent positions.”⁴⁸ With regard to the Harry S. Truman Memorial Scholarships,
“The Committee directs the Board of the Truman Scholarship program to strictly
adhere to its statutory mandate to ‘assure that at least one Truman scholar shall be
selected each year from each State in which there is at least one resident applicant
who meets the minimum criteria established by the Foundation’.”⁴⁹
The conference agreement and the law, likewise, provide an appropriation of
$68.4 million, of which up to $1,500 shall be available for official representation
expenses. This amount is $8.2 million less than the President’s request. After the
0.80% rescission, the FY2005 funding is $67.9 million, a reduction of $8.7 million
from the President’s request. The provisions which discuss the use of the
appropriation are the same as recommended by the Senate Committee, except that the
reference to the Committee on Veterans’ Affairs is removed, and the provision
related to water resource reports relates to funds provided in this act or in prior acts,
but not in subsequent acts.
Office of National Drug Control Policy (ONDCP). The ONDCP develops
policies, objectives, and priorities for the National Drug Control Program. The
account also funds general policy research to support the formulation of the National
Drug Control Strategy.
The President’s FY2005 budget proposed an appropriation of $27.6 million. The
FY2004 appropriation was $28.0 million, but after the 0.59% rescission was $27.8
million. The requested amount is 0.8% less than the FY2004 funding after the
rescission. Of the total amount requested, $26.3 million is for salaries and expenses
operations and $1.4 million is for policy research.⁵⁰ An additional five full-time
equivalent employees are requested.
The House Committee on Appropriations recommended, and the House passed,
an appropriation of $28.1 million. This amount is $500,000 more than the
President’s request. Of the total, $1.3 million would be for policy research and
evaluation, $25.8 million would be for operations, and $1 million would be used to
reduce the demand for methamphetamine. The Committee approves five additional
full-time equivalent employees for ONDCP, but no additional funding for staff is
provided because of budget constraints. The Office could accept, hold, administer,
and utilize gifts (both real and personal, public and private), without fiscal year
limitation to aid or facilitate its work.

⁴⁷ Ibid., p. 163.
⁴⁸ Ibid.
⁴⁹ Ibid., p. 164.
⁵⁰ EOP Budget Submission, p. 162.

The Senate Committee on Appropriations recommended and the conference
agreement and the law provide an appropriation of $27 million, which is $600,000
less than the President’s request. After the 0.80% rescission, the FY2005 funding is
$26.8 million, a reduction of $800,000 from the President’s request. Of the total
amount requested, $1.4 million is for policy research and evaluation. The
Committee’s report accompanying the Senate bill lists the funding and number of
full-time equivalent employees for specific offices under ONDCP.⁵¹ ONDCP is
directed “to utilize a portion of its policy research funding to explore ways in which
to increase inhalant outreach activities without compromising other ongoing
educational efforts.”⁵² The Office must report its findings to the House and Senate
Committees on Appropriations within 180 days of the act’s enactment.
The conference report states that the “agreement retains specific funding and
staffing levels for ONDCP administrative offices as proposed in the Senate report.
In addition, 2.5 new FTE are approved to be allocated to administrative offices at the
Director’s discretion.”⁵³
The Counterdrug Technology Assessment Center (CTAC). The
CTAC is the central counterdrug research and development organization for the
federal government.
The President’s FY2005 budget proposed an appropriation of $40 million. The
FY2004 appropriation was $42 million, but after the 0.59% rescission was $41.8
million. The requested amount is 4.2% less than the FY2004 funding after the
rescission. Of the total amount requested, $18 million is for counternarcotics
research and development projects (which shall be available for transfer to other
federal departments or agencies), and $22 million is for the continued operation of
the technology transfer program.⁵⁴
The House Committee on Appropriations recommended and the House passed
an appropriation of $30 million. This amount is $10 million less than the President’s
request. Of the total, $10 million would fund counternarcotics research and
development projects (which shall be available for transfer to other federal
departments or agencies), and $20 million would fund the continued operation of the
technology transfer program.
The Senate Committee on Appropriations recommended an appropriation of $42
million, which is $2 million more than the President’s request. Of the total amount
requested, $18 million is for counternarcotics research and development projects
which would be available for transfer to other federal departments or agencies and
$24 million is for the continued operation of the technology transfer program. The
Committee’s report accompanying the Senate bill establishes various reporting
requirements for programs under CTAC as follows.

⁵¹ S.Rept. 108-342, p. 164.
⁵² Ibid., p. 165.
⁵³ Congressional Record, daily edition, vol. 150, Nov. 19, 2004, p. H10820.
⁵⁴ FY2005 Budget, Appendix, p. 1135.

Prior to the obligation of any of [the CTAC] funds, the Committee directs
CTAC’s chief scientist to submit to the House and Senate Committees on
Appropriations a detailed itemization of anticipated expenditures. The
Committee also directs the chief scientist to continue to provide biannual reports
on the priority counterdrug enforcement research and development requirements
identified by CTAC and on the status of resulting projects funded thereby. These
reports should continue to provide the same level of detail that was provided in
the March 1, 2004, CTAC report to Congress.
The Committee ... directs CTAC to complete all ongoing technology acquisition
R&D projects with the funding provided in fiscal year 2005. Thereafter, CTAC
is directed to adhere its R&D spending to those research efforts outlined in its
demand reduction vision statement as well as its supply reduction priorities
listing included in appendices E and F, respectively, of its March 1, 2004, CTAC
report.
The Committee directs CTAC to consider more equally funding all R&D
activities in the future and to report on its progress in this regard in its next
CTAC report.
The Committee ... directs CTAC to expeditiously obligate all of its R&D funding
exclusively in pursuit of the functions for which it has been appropriated. The
Committee further directs CTAC to report to the House and Senate Committees
on Appropriations within 30 days of enactment of this Act on the reasons for the
delay in obligating these funds.
[T]he Committee encourages CTAC to work with private industry to make their
developed technology available to State and local law enforcement agencies and
to report on the progress of these efforts in its next CTAC report to Congress.
In order to maintain a clear understanding of CTAC’s ability to meet demand for
the TTP, the Committee directs that the fiscal year 2006 budget justification
include a specific accounting of the total number of grant applications received⁵⁵
and the number awarded in the previous year.
The conference agreement and the law, likewise, provide an appropriation of
$42 million, which is $2 million more than the President’s request. After the 0.80%
rescission, the FY2005 funding is $41.7 million, an increase of $1.7 million above
the President’s request. The counternarcotics research and development projects and
the technology transfer program are funded at the levels recommended by the Senate
Committee. The conference report states that the “agreement retains language ...
directing the CTAC chief scientist to submit an expenditures report prior to the
obligation of funds ... retains language directing CTAC to complete all on-going
technology acquisition projects and adhere to its research and development spending
plan ... [and agrees] with language ... directing CTAC to expeditiously obligate all
of its research funding in pursuit of functions for which it was appropriated.”⁵⁶

⁵⁵ S.Rept. 108-342, pp. 165-166.
⁵⁶ Congressional Record, daily edition, vol. 150, Nov. 19, 2004, p. H10820.

Federal Drug Control Programs. The High Intensity Drug Trafficking
Areas (HIDTA) program provides assistance to federal, state, and local law
enforcement entities operating in those areas most adversely affected by drug
trafficking. Funds are disbursed at the discretion of the director of ONDCP for joint
local, state, and federal initiatives.
The President’s FY2005 budget proposed an appropriation of $208.4 million.
The FY2004 appropriation was $226.4 million, but after the 0.59% rescission was
$225.0 million. The requested amount is 7.4% less than the FY2004 funding after
the rescission. No less than 51% of the total shall be transferred to state and local
entities for drug control activities, which shall be obligated within 120 days of
enactment of the Transportation/Treasury appropriations act. Up to 49% of the total
shall remain available until September 30, 2006, and may be transferred to federal
agencies and departments at a rate to be determined by the director, of which not less
than $2.1 million shall be used for auditing services and associated activities, and at
least $500,000 of the $2.1 million shall be used to develop and implement a data⁵⁷
collection system to measure the performance of the HIDTA Program.
The House Committee on Appropriations recommended and the House passed
an appropriation of $215.4 million. This amount is $7 million more than the
President’s request. Of the total, not less than $208 million would be provided as
base funding to HIDTAs. The other provisions related to allocation of the funds are
the same as the President’s request, except that $2 million would be used for auditing
services and associated activities. The House bill would provide that prior to the
obligation of funds of an amount in excess of the FY2005 budget request, a request,
made in compliance with the reprogramming guidelines, would be submitted to the
House and Senate Committees on Appropriations for approval. The committee
report accompanying the House bill states that the increased appropriation “is to meet
requirements to fully fund existing HIDTA program activity, to expand existing
HIDTAs where such expansion is justified, and to fund new HIDTAs as⁵⁸
appropriate.” The Committee recommends that increased funding be considered
for the North Texas, Appalachian, Central Florida, Central Valley, and Lake County
HIDTAs and that expansion be considered for the Gulf Coast HIDTA.
The Senate Committee on Appropriations recommended an appropriation of
$228.4 million, which is $20 million more than the President’s request. The Senate
bill includes a provision that HIDTA programs designated as of September 30, 2003,
would be funded at no less than the FY2004 initial allocation levels unless the
Director submits to the House and Senate Committees on Appropriations, and the
Committees approve, justification for changes in those levels based on clearly
articulated priorities for the HIDTA programs and performance measures of
effectiveness published by the ONDCP. Prior to the obligation of funds of an
amount in excess of the FY2005 budget request, a request, made in compliance with
the reprogramming guidelines, would be submitted to the House and Senate
Committees on Appropriations for approval. The Senate bill also would provide that
none of the funds would be available to support the Consolidated Priority

⁵⁷ FY2005 Budget, Appendix, p. 1133.
⁵⁸ H.Rept. 108-671, p. 133.

Organization Target program. The Committee’s report accompanying the Senate bill
includes the following directives.
In allocating HIDTA funds, the Committee expects the Director of ONDCP to
ensure that the entities receiving these limited resources make use of them
strictly for implementing the strategy for each HIDTA, taking into consideration
local conditions and resource requirements. These funds should not be used to
supplant existing support for ongoing Federal, State, or local drug control
operations normally funded out of the operating budgets of each agency.
The Committee directs ONDCP to refocus its distribution of HIDTA funding in
excess of the initial allocation on enhancing the domestic interdiction of illegal
drugs by launching additional investigations, by disrupting and dismantling local
mid-level drug trafficking organizations through a systematic and coordinated
effort and by supporting the various HIDTA Intelligence Support Centers⁵⁹
throughout the country.
With respect to specific HIDTAs, the Committee directs the ONDCP
^!in the Appalachia HIDTA, “to maintain funding at no less than [the]
FY2004 initial allocation.”
^!in the New York/New Jersey HIDTA, “to work with the affected
counties [in upstate New York] to determine whether they meet the
statutory criteria required for designation as a HIDTA. The
Committee directs ONDCP to ensure that funding for the New
York/New Jersey HIDTA is provided at a level no less than the
FY2004 initial allocation and to work with the Executive Board of
the ... HIDTA to assess the needs of the HIDTA and to provide
additional resources if necessary.”
^!in the Northwest HIDTA, “to provide adequate resources to combat
[the threat of methamphetamine, marijuana, cocaine, and heroin] ....
the Committee notes the value of State and local task forces in
addressing these issues and encourages the continued incorporation⁶⁰
of such entities in this and other HIDTAs.”
The conference agreement and the law, likewise, provide an appropriation of
$228.4 million, which is $20 million more than the President’s request. After the
0.80% rescission, the FY2005 funding is $226.5 million, an increase of $18.1 million
above the President’s request. No less than 51% of the total shall be transferred to
state and local entities for drug control activities, which shall be obligated within 120
days of enactment of the act. Up to 49% of the total shall remain available until
September 30, 2006, and may be transferred to federal agencies and departments at
a rate to be determined by the director, of which not less than $2 million shall be used
for auditing services and associated activities, and at least $500,000 of the $2 million

⁵⁹ S.Rept. 108-342, p. 167.
⁶⁰ Ibid., pp. 167-168.

shall be used to develop and implement a data collection system to measure the
performance of the HIDTA Program.
HIDTA programs designated as of September 30, 2004, are funded at no less
than the FY2004 initial allocation levels unless the Director submits to the House and
Senate Committees on Appropriations, and the Committees approve, justification for
changes in those levels based on clearly articulated priorities for the HIDTA
programs and performance measures of effectiveness published by the ONDCP.
Prior to the obligation of funds of an amount in excess of the FY2005 budget request,
a request, made in compliance with the reprogramming guidelines, must be submitted
to the House and Senate Committees on Appropriations for approval. Up to $2
million of the funds made available to HIDTAs in excess of the FY2005 budget
request shall be available for the Consolidated Priority Organization Target program.
The conference report states that “The conferees encourage ONDCP to refocus the
distribution of excess funding on enhancing the domestic interdiction of illegal drugs
by launching additional investigations, by disrupting and dismantling local mid-level
drug trafficking organizations and by supporting the HIDTA Intelligence Support
Centers.”⁶¹
Other Federal Drug Control Programs (formerly The Special
Forfeiture Fund). The account, administered by the director of ONDCP, supports
high-priority drug control programs. The funds may be transferred to drug control
agencies or directly obligated by the ONDCP director.
The President’s FY2005 budget proposed an appropriation of $235 million. The
FY2004 appropriation was $229 million, but after the 0.59% rescission was $227.6
million. The requested amount is 3.2% more than the FY2004 funding after the
rescission. Of the total amount requested, $145 million is to support a national media
campaign, as authorized by the Drug-Free Media Campaign Act of 1998; $80 million
is to continue a program of matching grants to drug-free communities, of which $1
million shall be a directed grant to the Community Anti-Drug Coalitions of America;
$4.5 million is for the Counterdrug Intelligence Executive Secretariat; $2 million is
for evaluations and research related to National Drug Control Program performance
measures; $1 million is for the National Drug Court Institute; $1.5 million is for the
United States Anti-Doping Agency for anti-doping activities; and $1 million is for
the United States membership dues to the World Anti-Doping Agency.⁶²
The House Committee on Appropriations recommended and the House passed
an appropriation of $195 million. This amount is $40 million less than the
President’s request. The appropriation would be allocated as follows: a national
media campaign ($120 million), matching grants to drug-free communities ($70
million) of which $1 million would be a directed grant to the Community Anti-Drug
Coalitions of America, the Counterdrug Intelligence Executive Secretariat ($1
million), evaluations and research related to National Drug Control Program
performance measures ($1.5 million), the National Drug Court Institute ($500,000),
the United States Anti-Doping Agency ($1.5 million), and the United States

⁶¹ Congressional Record, daily edition, vol. 150, Nov. 19, 2004, p. H10820.
⁶² FY2005 Budget, Appendix, p. 1134.

membership dues to the World Anti-Doping Agency ($500,000). The funds could
be transferred to other federal departments and agencies to carry out such activities.
No less than 78% of the funds appropriated for a national media campaign would be
used to purchase advertising time and space for the campaign. ONDCP is directed
by the Committee to ensure that the timeline and application processes for releasing
funds to the U.S. Anti-Doping Agency is followed. The release of funds cannot be
expedited by ONDCP unless it submits a justification for such to the House and
Senate Committees on Appropriations. The GAO is directed to conduct a study of
government-sponsored public service campaigns and report its findings to the
appropriation Committees no later than June 1, 2005. The study should examine “the
federal agencies and other participants involved; the basis and purpose of these
sponsorships; the annual and cumulative federal government and other participant
costs for each campaign; [and] the target audiences, media employed, and results
achieved for each campaign.”⁶³
The Senate Committee on Appropriations recommended an appropriation of
$195.5 million which is $39.5 million less than the President’s request. The
appropriation would be allocated as follows: a national media campaign ($100
million), matching grants to drug-free communities ($80 million) of which $2 million
would be a directed grant to the Community Anti-Drug Coalitions of America, the
Counterdrug Intelligence Executive Secretariat ($3.050 million), the National Drug
Court Institute ($1 million), the National Alliance for Model State Drug Laws ($1.5
million), the United States Anti-Doping Agency ($7.5 million), the United States
membership dues to the World Anti-Doping Agency ($1.450 million), and evaluation
and research related to National Drug Control Program performance measures ($1
million). The funds could be transferred to other federal departments and agencies
to carry out such activities. Not more than 10% of the amounts appropriated for a
national media campaign would be for administering the national media campaign.
The Committee’s report accompanying the Senate bill establishes various
reporting requirements for programs under this account as follows.
The Committee ... directs ONDCP to utilize the individual [advertising] and
overall Campaign assessments provided by the [media campaign] evaluation
study [on drug use] to measure the effectiveness of its advertisements and to
focus and shape the Media Campaign for the future.
The Committee ... directs ONDCP to maintain funding for its non-advertising
services at no less than the fiscal year 2003 level and to re-institute the corporate
outreach program as it operated prior to its cancellation.
The Committee directs ONDCP to use its voice and vote as the United States’
representative in ... [the World Anti-Doping Agency] to ensure that all countries’
athletes are subject to fair and equal standards and treatment so as to establish
and maintain the objectivity and integrity of this ... regulatory organization.
The Committee ... directs ONDCP to provide the entire amount [of funding for
the National Alliance for Model State Drug Laws (NAMSDL)] directly to
NAMSDL within 30 days after enactment of this Act.

⁶³ H.Rept. 108-671, p. 135.

[T]he Committee directs ONDCP to submit its planned [Performance Measures
Development (PMD)] activities to CTAC’s chief scientist for review and then to
report to the House and Senate Committees on Appropriations within 90 days of
enactment of this Act providing the chief scientist’s findings and explaining why⁶⁴
these anticipated PMD functions are most properly funded within PMD.
The conference agreement and the law provide an appropriation of $213.7
million, which is $21.3 million less than the President’s request. After the 0.80%
rescission, the FY2005 funding is $212 million, a reduction of $23 million from the
President’s request. The appropriation is allocated (before the rescission) as follows:
a national media campaign ($120 million), matching grants to drug-free communities
($80 million) of which $2 million would be a directed grant to the Community Anti-
Drug Coalitions of America, the Counterdrug Intelligence Executive Secretariat ($2
million), the National Drug Court Institute ($750,000), the National Alliance for
Model State Drug Laws ($1 million), the United States Anti-Doping Agency ($7.5
million), the United States membership dues to the World Anti-Doping Agency
($1.450 million), and evaluation and research related to National Drug Control
Program performance measures ($1 million). The funds may be transferred to other
federal departments and agencies to carry out such activities. Not more than 10% of
the amounts appropriated for a national media campaign shall be for administration,
advertising production, research and testing, labor and related costs of the campaign.
According to the conference report, the “agreement directs ONDCP to maintain
funding for nonadvertising services for the Media Campaign at no less than the
FY2003 ratio of service funding to total funds and to re-institute the corporate
outreach programs as it operated prior to its cancellation ... direct ONDCP to obligate
the appropriation for NAMSDL expeditiously, although not outside normal grant
procedures [and] ... retain[s] language ... directing ONDCP to submit the planned
performance measures development plan.”⁶⁵
Unanticipated Needs. The account provides funds for the President to meet
unplanned and unbudgeted contingencies for national interest, security, or defense
purposes.
The President’s FY2005 budget proposed an appropriation of $1 million. The
same amount was appropriated in FY2004, but after the 0.59% rescission, the
funding was $994,000. The House and Senate Committees on Appropriations
recommended, the House passed, and the conference agreement and the law provide
the same amount as the President requested. After the 0.80% rescission, the FY2005
funding is $992,000, a reduction of $8,000 from the President’s request.
Special Assistance to the President (Office of the Vice President).
This account funds the Vice President in carrying out the responsibilities assigned to
him by the President and by law.

⁶⁴ S.Rept. 108-342, pp. 169-172.
⁶⁵ Congressional Record, daily edition, vol. 150, Nov. 19, 2004, p.H10820.

The President’s FY2005 budget proposed an appropriation of $4.6 million for
salaries and expenses. The FY2004 appropriation was $4.5 million, but after the
0.59% rescission was $4.4 million. The requested amount is 3.1% more than the
FY2004 funding after the rescission. The House and Senate Committees on
Appropriations recommended, the House passed, and the conference agreement and
the law provide the same amount as the President requested. After the 0.80%
rescission, the FY2005 funding is $4.5 million, a reduction of $100,000 from the
President’s request.
Official Residence of the Vice President. This account provides for the
care and operation of the Vice President’s official residence and includes the
operation of a gift fund for the residence.
The President’s FY2005 budget proposed an appropriation of $333,000 for the
operating expenses of the Official Residence. The FY2004 appropriation was
$331,000, but after the 0.59% rescission was $329,000. The requested amount is
1.2% more than the FY2004 funding after the rescission. The House and Senate
Committees on Appropriations recommended, the House passed, and the conference
agreement and the law provide the same amount as the President requested. After the
0.80% rescission, the FY2005 funding is $330,336, a reduction of some $2,600 from
the President’s request. Advances or repayments or transfers may be made from the
appropriation to any department or agency for expenses related to the account. The
committee report accompanying the Senate bill states that the budget for the
Department of the Navy funds renovations at the residence and that the Committee
“expects to be kept fully apprized by the Vice President’s office of any and all
renovations and alterations made to the residence by the Navy.”⁶⁶
Merit Systems Protection Board (MSPB). The MSPB serves as guardian
of the federal government’s merit-based system of employment. The agency carries
out its mission by hearing and deciding appeals from federal employees of removals
and other major personnel actions. The MSPB also hears and decides other types of
civil service cases, reviews OPM regulations, and conducts studies of the merit
systems. The agency’s efforts are to assure that personnel actions taken involving
employees are processed within the law and that actions taken by OPM and other
agencies support and enhance federal merit principles.
The President’s FY2005 budget proposed an appropriation of $37.3 million for
the MSPB. The FY2004 appropriation was $32.9 million, but after the 0.59%
rescission was reduced to $32.7 million. In addition, up to $2.626 million for
administrative expenses could be transferred from the Civil Service Retirement and
Disability Fund to adjudicate retirement appeals. After the 0.59% rescission, the
amount available for transfer was reduced to up to $2.611 million. The requested
amount is 5.7% more than the FY2004 total funding after the rescission.
As in its FY2004 budget proposal, MSPB again proposed that the funding
previously provided from the trust fund for adjudication of civil service retirement
appeals be requested as part of the agency’s regular appropriation. OMB

⁶⁶ S.Rept. 108-342, p. 173.

recommended this change to simplify financial record keeping. The FY2005 budget
proposal does not specify how much of the requested $37.3 million would be
allocated as transferred funds for adjudication purposes. The House and Senate
Committees on Appropriations in FY2004 did not agree with the proposal and
instead recommended (with the conferees concurring) that the trust fund transfer be
continued. According to the House committee report accompanying H.R. 2989, the
Committee decided
to continue the practice of appropriating funds to MSPB from the Civil Service
Retirement and Disability Fund rather than discontinuing this practice as⁶⁷
requested by the President; this request has not been adequately justified.
The House Committee on Appropriations recommended, and the House passed,
an appropriation of $34.7 million and a trust fund transfer of up to $2.620 million.
The recommended appropriation is $2.6 million less than the President’s request.
According to the committee report accompanying the House bill, “The decrease ...
reflects the Committee’s decision to continue the practice of appropriating funds to
MSPB from the Civil Service Retirement and Disability Fund rather than
discontinuing this practice as proposed in the budget request as this proposal has not
been adequately justified.”⁶⁸
The Senate Committee on Appropriations recommended and the conference
agreement and the law provide an appropriation of $34.7 million, $2.6 million less
than the President’s request. After the 0.80% rescission, the FY2005 funding is
$34.4 million, a reduction of $2.9 million from the President’s request. The
committee report accompanying the Senate bill states that “The decrease from the
President’s request reflects the Committee’s decision to continue the practice of
appropriating funds to MSPB from the Civil Service Retirement and Disability Fund
rather than discontinuing this practice as requested by the President; this request has
not been adequately justified.”⁶⁹ The Committee recommended and the conference
agreement and the law provide the same amount as the President requested for the
trust fund transfer (up to $2.626 million). After the 0.80% rescission, this amount
would be up to $2.605 million, a reduction of $21,000 from the President’s request.
Office of Personnel Management (OPM). The budget for OPM is
composed of budget authority for both permanent and current appropriations. This
report discusses the budget authority for current appropriations. The agency “is the
central human resources agency for the Federal Government and the primary agency
helping the President carry out his responsibilities in managing the Federal
workforce.” The Strategic Human Resources Policy Division “designs, develops, and
leads the implementation of innovative, flexible, merit-based human resources
policies and strategies that enable Federal agencies to meet their missions and

⁶⁷ H.Rept. 108-243 (2003), pp. 191-192.
⁶⁸ H.Rept. 108-671, p. 148.
⁶⁹ S.Rept. 108-342, p. 187.

achieve their goals.”⁷⁰ The Human Capital Leadership and Merit System
Accountability Division assists agencies in implementing and assessing human
capital standards. The Human Resources Products and Services Division supports
federal agencies by administering retirement and insurance programs, providing
personnel investigation services, managerial and executive training, and other human
resources services.
The Office of Inspector General (OIG) conducts audits, investigations,
evaluations, and inspections throughout the agency and may issue administrative
sanctions related to the operation of the Federal Employees Health Benefits Program
that “debar from participation in the health insurance program those health care
providers whose conduct may pose a threat to the financial integrity of the program
itself or to the well-being of insurance program enrollees.”⁷¹
The President’s FY2005 budget proposed an appropriation of $18.2 billion for
OPM. This total includes discretionary funding of $131.3 million⁷² for OPM salaries
and expenses and $1.627 million for OIG salaries and expenses. It also includes
mandatory funding of $8.1 billion for the government payment for annuitants of the
employees health benefits program,⁷³ $35 million for the government payment for
annuitants of the employee life insurance program, and $9.8 billion for payment to
the civil service retirement and disability fund. Included in this total as well are trust
fund transfers of $128.5 million⁷⁴ to the OPM salaries and expenses account (for
administrative expenses for the retirement and insurance programs) and $16.461
million⁷⁵ to the OIG salaries and expenses account (for administrative expenses to
audit, investigate, and provide other oversight of OPM’s retirement and insurance
programs).

⁷⁰ U.S. Office of Personnel Management, Congressional Budget Justification; Performance
Budget Fiscal Year 2005, Feb. 2004, p. 4. (Hereafter referred to as OPM Budget
Justification.)
⁷¹ FY2005 Budget, Appendix, p. 1060.
⁷² The total of $131.3 million would be allocated as follows: Enterprise Human Resources
Integration project ($2 million); leading the government-wide initiative to modernize the
federal payroll systems and service delivery ($6.6 million); e-Human Resources Information
System project ($800,000); e-Clearance project ($2 million); and coordination and conduct
of program evaluation and performance measurement ($5 million shall remain available
through September 30, 2006).
⁷³ The FY2005 Budget, Appendix, at p. 1061, states the FY2005 budget request for the
government payment for annuitants of the employees health benefits program as $8.0
billion. The House Appropriations Committee report accompanying the House bill shows
the FY2005 budget request and the Committee’s recommended appropriation for this
account as $8.1 billion.
⁷⁴ Of this total of $128.5 million, $27.6 million would fund automation of the retirement
record keeping systems.
⁷⁵ This money is for administrative expenses to audit, investigate, and provide other
oversight of OPM’s retirement and insurance programs.

According to OPM’s budget submission, the $131.3 million requested for
salaries and expenses “includes $114.876 million in annual funds, $11.415 million
in no-year funds for e-Government (e-Gov) projects, and $5 million in two-year
funds to coordinate and conduct program evaluation and performance measurement.”
The budget submission states that “Annual funds include an increase of $3,042,000...
to provide human capital support, hiring solutions, enhanced IT support, competitive
sourcing studies, and homeland security and emergency response.”⁷⁶
With regard to the OIG, the budget reported that the amount requested
will finance more audit staff, special agent criminal investigators, and improved
information systems. OPM expects to reduce the audit cycle to 2.9 years for
FEHBP [Federal Employees Health Benefits Plan] carriers. Total recoveries are
expected to increase by $14 million annually. In 2005, OPM will add audits of
pharmacy benefit managers and expand the scope of audits for the largest
community-rated health plans (comprehensive medical plans commonly referred⁷⁷
to as health maintenance organizations) participating in FEHBP.
The FY2004 appropriation for OPM was $17.5 billion after the 0.59%
rescission. The requested amount for FY2005 is 4% more than the FY2004 total
funding after the rescission. Specifically, it is 10.5% more than the $118.8 million
appropriated in FY2004 for salaries and expenses after the rescission; 9.3% more
than the $1.5 million for OIG salaries and expenses after the rescission; 12.5% more
than the $7.2 billion for the government payment for annuitants of the employees
health benefits program; the same amount ($35 million) for the government payment
for annuitants of the employee life insurance program; 2.2% less than the $10.0
billion for payment to the civil service retirement and disability fund; 4.9% less than
the $135.1 million for OPM salaries and expenses transferred from trust funds after
the rescission; and 14.8% more than the $14.3 million for OIG salaries and expenses⁷⁸
transferred from trust funds after the rescission.
The House Committee on Appropriations recommended, and the House passed,
an appropriation of $120.4 million for OPM salaries and expenses, $10.9 million less
than the President’s request. The funds for the enterprise human resources
integration project, the government-wide initiative to modernize the federal payroll
systems and service delivery, the e-human resources information system project, and
the e-clearance project would be allocated in the same manner as the President

⁷⁶ OPM Budget Justification, p. 8.
⁷⁷ FY2005 Budget, Appendix, p. 1060.
⁷⁸ The FY2004 appropriation prior to the 0.59% rescission was $119.5 million for salaries
and expenses, $1.5 million for OIG salaries and expenses, $135.9 million for OPM salaries
and expenses transferred from trust funds, and $14.4 million for OIG salaries and expenses
transferred from trust funds. The amounts of $7.2 billion, $35 million, and $10 billion for
FY2004 are from P.L. 108-199. OPM notifies the Secretary of the Treasury of the “such
sums as may be necessary” to fund these accounts each fiscal year. The FY2005 budget
appendix states that the FY2005 estimates for these accounts are $8.0 billion, $35 million,
and $9.8 billion. (p. 1061) The House Appropriations Committee report accompanying the
House bill shows the FY2005 budget request and the Committee’s recommended
appropriation for the employees health benefits program as $8.1 billion.

requested. The recruitment one stop project would be appropriated $3.3 million. The
appropriations recommended for OIG salaries and expenses, the employees health
benefits program, the employee life insurance program, the Civil Service retirement
and disability fund, and the trust fund transfers to the OPM and OIG salaries and
expenses accounts are the same amounts as the President requested. The trust funds
under the OPM salaries and expenses account would be allocated as the President
requested.
The House Committee on Appropriations’ committee report accompanying the
House bill lists appropriations for specific programs as follows: performance culture
under strategic human resources policy should not exceed the FY2004 funding level
of $5.8 million, providing advice to agencies under human capital leadership merit
systems accountability should not exceed the FY2004 funding level of $16.8 million,
the compliance program under human capital leadership merit systems accountability
should not exceed the FY2004 funding level of $16.5 million, management strategy
is funded at $46.2 million, E-gov initiative fees are not funded, completion of the
current retirement readiness project is funded at $250,000, and expansion of the
project to non-federal government employees is funded at $500,000. Within 60 days
of the act’s enactment, OPM is directed to submit an operating plan for FY2005,
signed by the Director, to the House and Senate Committees on Appropriations. The
plan “should include funding levels for the various offices, programs and initiatives
covered in the budget justification and supporting documents referenced in the House
and Senate appropriations reports, and the statement of the managers.” According to
the committee report
The Committee finds that the budget justification materials are severely lacking
in any real detail about the programs proposed or underway at OPM and the
resources involved. Many of the verbose descriptions in the budget justification
did not provide concrete information on the programs, activities and funding⁷⁹
requirements and changes to OPM’s work.”
Additionally, OPM is directed “to include with the ‘Annual Report on Locality-
Based Comparability Payments for the General Schedule’ in FY2005 and all future
fiscal years a report comparing the total pay and non-pay compensation packages of
the Federal workforce and the private sector” and, within 30 days of the act’s
enactment, “respond to the formal request of the Butner Low Security Correctional
Institution regarding its petition on the Central Carolina/Richmond-Petersburg wage
area.”⁸⁰ The committee report notes that OPM’s decision to make health savings
accounts a part of the federal employees’ benefits package is welcomed.
The Senate Committee on Appropriations recommended an appropriation of
$130.6 million for OPM salaries and expenses which is $691,000 less than the
President’s request. The total would be allocated as follows: Enterprise Human
Resources Integration project ($1.9 million); leading the government-wide initiative
to modernize the federal payroll systems and service delivery ($6.2 million); e-
Human Resources Information System project ($748,000); e-Clearance project ($1.9

⁷⁹ H.Rept. 108-671, pp. 152-153.
⁸⁰ Ibid., p. 153.

million); and coordination and conduct of program evaluation and performance
measurement ($5 million would remain available through September 30, 2006). The
committee report accompanying the Senate bill states that “no more than $10,724,000
is to be used for e-Government projects.”⁸¹
The Committee recommended funding in the same amounts as the President
requested for OIG salaries and expenses, the employees health benefits program, the
employee life insurance program, the Civil Service retirement and disability fund,
and the trust fund transfers to the OPM and OIG salaries and expenses accounts. Of
the total transferred from trust funds to the OPM salaries and expenses account
($128.5 million), $27.6 million would fund automation of the retirement record
keeping systems.
The Senate bill also would provide that none of the funds appropriated or made
available under this act or any other appropriations act could be used to implement
or enforce restrictions or limitations on the Coast Guard Congressional Fellowship
Program, or to implement OPM’s proposed regulations, relating to the detail of
executive branch employees to the legislative branch, published in the Federal
Register on September 9, 2003. If the proposed regulations are final on this act’s
enactment date, none of the funds appropriated or made available under this act could
be used to implement, administer, or enforce such final regulations.
The Senate Committee on Appropriations directs the GAO, in consultation with
OPM and the GSA, to study the child care needs of federal employees in executive,
legislative, and judicial branch agencies. GAO is “to provide guidance and
recommendations of possible options to develop and evaluate additional child care
facility needs and how best to serve the needs of all Federal employees.” OPM is
directed “to reevaluate its efforts to provide information and education to agencies”
on programs which provide subsidized child care for lower income employees.⁸²
With regard to OPM’s ongoing program to automate and streamline the
processes for administering the federal retirement program, the Committee
recommends that OPM continue to seek GAO guidance and support. The GAO is
directed “to do a comprehensive audit on the problems and any mismanagement of
the modernization project.”⁸³
The conference agreement and the law provide an appropriation of $125.5
million for OPM salaries and expenses, of which $12 million shall remain available
until September 30, 2007. This amount is $5.8 million less than the President’s
request. Funding in the same amounts as the President requested is provided for OIG
salaries and expenses, the employees health benefits program, the employee life
insurance program, the Civil Service retirement and disability fund, and the trust fund
transfers to the OPM and OIG salaries and expenses accounts. Of the money
appropriated for the trust fund transfer from the OPM salaries and expenses account,

⁸¹ S.Rept. 108-342, p. 193.
⁸² Ibid.
⁸³ Ibid., pp. 193-194.

$27.6 million shall remain available until expended for the cost of automating the
retirement recordkeeping systems. After the 0.80% rescission, the FY2005 funding
for OPM salaries and expenses is $124.5 million, for OIG salaries and expenses is
$1.614 million, for the trust fund transfer from the OPM salaries and expenses
account is $127.4 million, and from the OIG salaries and expenses account is
$16.329 million. These amounts represent reductions from the President’s request
of $6.8 million, $13,000, $1.1 million, and $132,000, respectively.
According to the conference report, the conferees
have not included bill language identifying specific resource levels for various
e-gov projects ... but direct the Office not to exceed the funding levels for the
following projects: $1,870,000 for the enterprise human resources integration
project, $6,219,000 for the federal payroll project, $748,000 for the e-human
resources information system project, and $1,887,000 for the e-clearance project.
To accommodate the obligation rate of these projects ... $12,000,000 of the funds
are made available until September 30, 2007. No funds are provided for the
recruitment one stop project or the program evaluation and performance
assessment project.
provide $250,000 to complete the retirement readiness project [and] ... urge the
Office to expand the ... project to non-federal employees.
allow the Director the flexibility to allocate the budget resources consistent with
the direction provided in this statement of the managers and the budget
justifications. The conferees reiterate the direction in the House report to submit
an operating plan within 60 days of enactment of this Act to the House and
Senate Committees on Appropriations detailing program funding levels for fiscal
year 2005.
reiterates the House direction to the Director to respond to the Butner Low
Security Correctional Institution petition within 30 days of enactment of this Act.
direct the Director to submit a report by March 4, 2005 comparing the pay and
non-pay compensation packages of the Federal workforce and the private sector.
expect OPM and GSA, with technical assistance from GAO, to work
collaboratively to collect data on child care needs, analyze options to meet the
identified needs, and provide the data and analysis to GAO. The conferees direct
GAO to review the data and analyses and provide an evaluation of the results to
the Committees on Appropriations. The conferees expect an update on the status
of these efforts 90 days after enactment of this Act ... the conferees reiterate the
Senate direction to the Office to reevaluate efforts to inform low-income⁸⁴
employees of programs to assist with child care expenses.
Human Capital Performance Fund. The President’s FY2005 budget
proposed an appropriation of $300 million for this fund. The FY2004 appropriation
was $1 million, but after the 0.59% rescission was $994,000. The fund

⁸⁴ Congressional Record, daily edition, vol. 150, Nov. 19, 2004, p. H10822.

is designed to create performance-driven pay systems for employees and
reinforce the value of employee performance management systems. It will
provide additional pay over and above any annual, across-the-board pay raise to
certain civilian employees based on individual or organizational performance
and/or other critical agency human capital needs. Ninety percent of funds
appropriated are to be distributed to agencies on a pro rata basis, upon OPM
approval of an agency’s plan. The remainder, and any amount withheld from⁸⁵
agencies due to inadequate plans, will be allocated at the discretion of OPM.
The House Committee on Appropriations recommended, and the House passed,
an appropriation of $12.5 million. This amount is $287.5 million less than the
President’s request. The House bill would allow the OPM Director to determine and
transfer to federal agencies such amounts as necessary to carry out the purposes of
the fund. No funds would be obligated or transferred until the Director has notified
the relevant subcommittees of the Committees on Appropriations of the approval of
an agency’s performance plan and the prior approval of such subcommittees has been
obtained. OPM is directed to report annually to the House and Senate Appropriations
Committees “on the performance pay plans that have been approved, and the
amounts that have been obligated or transferred.”⁸⁶
The Senate Committee on Appropriations did not recommend and the
conference agreement and the law do not provide funding for the performance fund.
The committee report accompanying the Senate bill states that such an initiative
“should be budgeted and administered within the salaries and expenses of each
individual agency.”⁸⁷
Office of Special Counsel (OSC). The agency investigates federal
employee allegations of prohibited personnel practices and, when appropriate,
prosecutes matters before the Merit Systems Protection Board; provides a channel for
whistle blowing by federal employees; and enforces the Hatch Act. In carrying out
the latter activity, the OSC issues both written and oral advisory opinions. The OSC
may require an agency to investigate whistle blower allegations and report to the
Congress and the President as appropriate.
The President’s FY2005 budget proposed an appropriation of $15.449 million
for the OSC. The FY2004 appropriation was $13.5 million, but after the 0.59%
rescission was reduced to $13.4 million. The requested amount is 15.1% more than
the FY2004 funding after the rescission. According to the budget, the funding “will
enable OSC to hire the additional staff needed to increase the case closure rate.⁸⁸
Without additional staff, case backlogs will continue to increase at OSC.”
The House and Senate Committees on Appropriations recommended, the House
passed, and the conference agreement and the law provide the same amount as the
President requested. After the 0.80% rescission, the FY2005 funding is $15.325

⁸⁵ FY2005 Budget, Appendix, p. 1060.
⁸⁶ H.Rept. 108-671, p. 155.
⁸⁷ S.Rept. 108-342, p. 196.
⁸⁸ FY2005 Budget, Appendix, p. 1172.

million, a reduction of $124,000 from the President’s request. Aware of OSC’s
critical need for more staff to address its case backlog of more than three years, the
committee report accompanying the Senate bill states that “the Committee expects
OSC to acquire an appropriate mix of new staff that will maximize its ability to
reduce this backlog” instead of hiring just attorneys. No later than March 31, 2005,
OSC must report to the Committees on Appropriations on “the status of its staffing
efforts, particularly describing those new positions hired and how the reduction of
OSC’s case backlog has benefitted as a result of the new personnel.”⁸⁹
Title IV: Independent Agencies
Table 8. Title IV: Independent Agencies Appropriations
(in millions of dollars)
^FY²⁰⁰⁵^FY²⁰⁰⁵
^Agency^FY²⁰⁰⁴^Ena^c^t^e^d*^FY²⁰⁰⁵^Request^FY²⁰⁰⁵^Hou^s^e^Sena^t^e^Ena^c^t^e^d*^*
^Cm^te.
^Natioⁿ^a^{l T}^r^an^sp^o^r^tatioⁿ^Saf^e^ty
^Board^$74^$74^$77^$76^$77
^F^e^deral^El^ectⁱ^oⁿ^C^o^m^mⁱ^s^sⁱ^on⁵¹⁵²⁵²⁵²⁵²
^El^ectⁱ^oⁿ^A^s^sⁱ^s^t^an^{ce C}^o^m^mⁱ^s^sⁱ^on^1,492⁵⁰¹⁵¹⁰¹⁴
^F^e^deral^L^a^{bor R}^e^l^a^tⁱ^oⁿ^s^A^u^t^h^ori^t^y²⁹³⁰³⁰²⁶²⁶
^Fed^e^r^a^{l Mar}^itim^{e Co}^m^mⁱ^ssioⁿ¹⁸¹⁹¹⁹¹⁹¹⁹
^G^eⁿ^e^ral^S^e^rvⁱ^ces^A^d^mⁱⁿⁱ^s^t^ratⁱ^oⁿ⁶⁴⁵²⁴³^1,825⁹⁷⁹⁷
^Mer^{it Sy}^stem^{s P}^r^o^t^ectioⁿ^B^o^ar^d³⁵³⁷³⁵³⁵³⁵
^Mo^r^rⁱ^{s K. Ud}^{all Fo}^uⁿ^d^atioⁿ³¹³³³
^Nation^a^{l A}^r^ch^iv^es^an^{d R}^ecords
^A^d^mⁱⁿⁱ^s^t^ratⁱ^oⁿ³⁰⁷³⁰⁴³⁰²³¹²³¹³
^O^ffi^c^e^o^f^P^e^r^s^o^nne^l^M^a^na^ge^m^e^nt
^(t^ot^al⁾^17,512^18,520^18,222^18,219^18,214
^Sal^arⁱ^e^s^{and Expens}^es¹¹⁹¹³¹¹²⁰¹³¹¹²⁶
^Gover^{nment Payments}^for
^Annuitants^,^Employees^Health
^Ben^e^fits⁷^,²¹⁹⁸^,¹³⁵⁸^,¹³⁵⁸^,¹³⁵⁸^,¹³⁵
^Gover^{nment Payments}^for
^Annuitants^,^{Employee Life}
^Iⁿ^s^u^r^aⁿ^c^e³⁵³⁵³⁵³⁵³⁵
^Pa^ymen^{t to}^{Civil S}^e^rvice
^Retir^{ement and Dis}^ability
^Fund^9,987^9,772^9,772^9,772^9,772
^O^f^fⁱ^{ce of}^S^p^eci^al^C^o^uⁿ^s^el¹³¹⁵¹⁵¹⁵¹⁵
^Pos^t^al^S^e^rvⁱ^c^e⁹⁶⁹⁸⁹⁸¹²⁷⁵⁹⁸
^Un^{ited States}^T^a^x^C^o^u^r^t⁴⁰⁴¹⁴¹⁴¹⁴¹
^T^o^tal^,^Iⁿ^d^e^p^eⁿ^d^eⁿ^t^A^g^en^ci^es^20,332^19,494^19,121^19,552^19,547

⁸⁹ S.Rept. 108-342, p. 197.

^S^o^u^rce:^Fig^u^re^s^a^r^e^f^r^om^a^budg^e^t^a^u^thority^ta^ble^prov^ide^d^by^the^H^ous^e^Com^m^itte^e^{on A}^ppropria^tions^{. B}^ecau^se
^of^dif^f^e^ring^tre^a^t^m^e^{nt of}^of^f^s^e^t^{s, the}^tota^{ls w}^{ill not}^a^l^w^a^y^s^m^a^tc^{h the}^A^d^mⁱ^nistra^{tion’s tota}^{ls. T}^h^e^fⁱ^g^u^re^s^w^ithin
^this^ta^ble^m^a^y^dif^f^e^r^s^lig^htly^f^r^om^thos^e^{in the}^te^x^t^due^{to s}^upple^m^eⁿ^ta^{l a}^ppr^opr^ia^tions,^r^e^sci^ssi^oⁿ^s^{, a}^{nd othe}^r
^f^unding^a^c^tions^{. C}^o^lumⁿ^s^m^a^y^{not a}^{dd due}^{to r}^ounding^or^e^x^c^l^us^{ion of}^s^m^a^lle^r^pr^og^r^a^m^line^-^ite^m^s^.
^Note:^A^ne^w^l^y^c^r^e^a^t^e^d^inde^pe^nde^{nt a}^g^eⁿ^c^y^w^h^ic^{h be}^g^a^{n ope}^r^a^{tion in FY}^{2004, the}^E^l^ect^{ion A}^s^sⁱ^s^t^aⁿ^c^e
^Co^m^mⁱ^ssioⁿ^,^receiv^e^d^an^ap^p^r^o^p^r^iatioⁿ^o^f^$¹^b^illioⁿ^f^o^{r el}^ectioⁿ^ref^o^rm^g^r^an^{ts in}^{a sep}^a^{rate d}ⁱ^vⁱ^sioⁿ^o^f^th^e
^FY^{2004 Cons}^olida^t^e^d^a^ppropria^tions^bill.
^*^FY^{2004 f}ⁱ^g^u^r^e^s^r^e^f^l^e^c^t^aⁿ^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^{on of}^0.59%^.
^*^*^F^Y^{2005 f}ⁱ^g^u^r^e^s^{do not r}^e^f^l^e^c^t^aⁿ^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^{on of}^0.80%^.
Federal Election Commission (FEC). The FEC administers federal
campaign finance law, including overseeing disclosure requirements, limits on
contributions and expenditures, and the presidential election public funding system;
the agency retains civil enforcement authority for the law. The Office of Election
Administration, which serves as a clearinghouse for information on voting laws and
procedures for state and local election officers, is another part of the FEC.
The President’s FY2005 budget proposed an appropriation of $52.2 million for
the FEC, an increase of $919,000 above the fiscal 2004 appropriation of $51.2
million; the increase reflects adjustments for inflation and salary and benefit
increases. The FEC endorsed the Administration proposal, with its estimated 391
full-time employees. Of the total amount, no less than $4.7 million is to be
designated for automated data processing systems. In addition, $800,000 is
designated for use by the Office of Election Administration, which is slated to be
moved to the newly created Election Assistance Commission, along with any funds
left over at the time of the move.
The House Appropriations Committee recommended, the House passed, and the
Senate Committee on Appropriations recommended the $52.2 million requested in
the President’s budget. The House added a requirement that the FEC accept no
reports and filings from House and Senate Members and candidates in other than
electronic form. The Senate Committee also added two legislative provisions: one
to enable (excess) federal campaign funds to be donated to state and local candidates
and to be used for other lawful purposes, and the other to clarify that principal
campaign committees of federal candidates are limited to contributions of $2,000 to
any authorized committee of another federal candidate. The Omnibus Appropriations
measure enacted by Congress authorized $52.2 million for the FEC and included the
two legislative provisions recommended by the Senate Committee (the House
provision was dropped).
Federal Labor Relations Authority (FLRA). The FLRA serves as a
neutral party in the settlement of disputes that arise between unions, employees, and
federal agencies on matters outlined in the Federal Service Labor Management
Relations Statute; decides major policy issues; prescribes regulations; and
disseminates information appropriate to the needs of agencies, labor organizations,
and the public. The FLRA also engages in case-related interventions and training and
facilitates labor-management relationships. It has three components: the Authority
which adjudicates labor-management disputes; the Office of the General Counsel
which, among other duties, investigates all allegations of unfair labor practices filed
and processes all representation petitions received; and the Federal Service Impasses
Panel which resolves impasses which occur during labor negotiations between
federal agencies and labor organizations.

The President’s FY2005 budget proposed an appropriation of $29.7 million for
the FLRA. The FY2004 appropriation was $29.6 million but after the 0.59%
rescission was $29.4 million. The requested amount is 0.81% more than the FY2004
funding after the rescission. The House Committee on Appropriations recommended
and the House passed the same appropriation as the President requested.
The Senate Committee on Appropriations recommended and the conference
agreement and the law provide an appropriation of $25.7 million, $4 million less than
the President’s request. Three million dollars is rescinded from prior year
appropriations which were unobligated. After the 0.80% rescission, the FY2005
funding is $25.5 million, a reduction of $4.2 million from the President’s request.
The committee report accompanying the Senate bill states that the recommendation
“reflects the decline in caseload and the reduction of the FTE level from 215 to 210.”
A rescission of $3 million of prior appropriations is recommended for salaries and
expenses because “significant amounts of annual appropriations have lapsed at the
end of FY2002 and 2003 which reflect salary and benefit surpluses related to the
decline in caseload and actual FTE usage over the same period.”⁹⁰
General Services Administration (GSA). The General Services
Administration administers federal civilian procurement policies pertaining to the
construction and management of federal buildings, disposal of real and personal
property, and management of federal property and records. It is also responsible for
managing the funding and facilities for former Presidents and presidential transitions.
As agreed to in the conference report (H.Rept. 108-792) on H.R. 4818, the
Consolidated Appropriations Act for FY2005, the House and Senate recommended
an appropriation of $62.1 million for government-wide policy and $92.2 million for
operating expenses; $42.4 million for the Office of Inspector General; $3.1 million
for allowances and office staff for former Presidents; and $3.0 million for the
electronic government fund. Due to the outcome of the 2004 presidential election,
no funds are needed for a presidential transition in FY2005. The conferees did not
provide additional funds for activities associated with the President’s second term of
office. They stated that the resources for these activities should be funded out of the
agencies and departments as necessary.
S. 2806 recommended an appropriation of $62.1 million for government-wide
policy and $85.2 million for operating expenses; $42.4 million for the Office of
Inspector General; $3.1 million for allowances and office staff for former Presidents;
and $3.0 million to remain available until expended for the electronic government
fund. A total of $7.7 million was also recommended for the expenses associated in
the event of a presidential transition. The Senate Committee on Appropriations
(S.Rept. 108-342) denied the request to amend the Presidential Transition Act to
allow $1.0 million for training and briefings for incoming appointees associated with
the second term of an incumbent President. The Committee stated that it had no
objection to funding such training, but believed that “it should be properly budgeted
for and requested by the appropriate agencies.”

⁹⁰ Ibid., pp. 176-177.

As passed in the House, H.R. 5025 recommended an appropriation of $62.1
million for government-wide policy and $82.2 million for operating expenses; $42.4
million for the Office of Inspector General; $3.5 million for allowances and office
staff for former Presidents; and $5.0 million to remain available until expended for
the electronic government fund. A total of $7.7 million was also recommended for
the expenses associated with a presidential transition. The House Committee on
Appropriations (H.Rept. 108-671) stated that it recommended the provision in the
President’s budget request to allow $1.0 million of the total $7.7 million
appropriation to remain available for the training and briefings of incoming
appointees associated with the second term of an incumbent President. The
remaining $6.7 million would be returned to the general fund of the Treasury.
The President’s FY2005 budget contained a request of $62.1 million for
government-wide policy and $82.2 million for operating expenses; $42.4 million
for the Office of Inspector General; $3.5 million for allowances and office staff for
former Presidents; $45.0 million for interagency electronic government initiatives;
and $17.6 million to be deposited into the Federal Consumer Information Center
Fund. In the event of a presidential transition, a total of $7.7 million was requested
in accordance with the Presidential Transition Act, as amended, to provide for an
orderly transfer of executive leadership. Of ths total, $1.0 million would be provided
for briefing new personnel associated with the incoming administration. Beginning
in FY2005, appropriation language is proposed to amend the Presidential Transition
Act to permit the expenditure of not more than $1.0 million for briefings for
incoming appointees associated with the second term of an incumbent President. If
there is no presidential transition, no other expenditures of transition funds would be
made available to an incumbent President. The remaining $6.7 million in
appropriated funds would be returned to the general fund of the Treasury.

Table 9. General Services Administration Appropriations
(in millions of dollars)
^FY²⁰⁰⁴^FY²⁰⁰⁵^FY²⁰⁰⁵^FY²⁰⁰⁵^FY²⁰⁰⁵
^F^{und / O}^f^fⁱ^ce^Ena^c^t^e^d^Request^Hou^s^e^Sena^t^e^Ena^c^t^e^d
^*^C^o^mm.^**
^Fed^e^r^a^{l B}^u^ildⁱⁿ^g^s^Fuⁿ^d
^Appr^oprⁱ^a^tⁱ^ons^$443^—^$1,622^—^—
^Lⁱ^mⁱ^t^a^tⁱ^ons^{on O}^b^lⁱ^gatⁱ^ons^6,812^$7,215^7,012^$7,200^$7,258
^Go^v^e^rⁿ^m^eⁿ^t^-^w^id^{e P}^o^licy⁵⁶⁶²⁶²⁶²⁶²
^O^p^eratⁱⁿ^g^Ex^pen^s^es⁸⁸⁸²⁸²⁸⁵⁹²
^Of^fⁱ^{ce of}^In^s^p^{ector Gen}^e^ral³⁹⁴²⁴²⁴²⁴²
^A^llow^aⁿ^ces^an^{d Of}^fⁱ^{ce Staf}^f
^f^o^{r Form}^{er P}^r^es^iden^ts³³³³³
^E^l^e^c^t^r^oⁿⁱ^c^G^o^ve^rⁿ^m^e^nt⁽^E^-
^G^o^v)^Fund³⁴⁵⁵³³
^G^S^A^ap^p^r^op^ri^ati^oⁿ^s
^total^***⁶⁴⁵²⁴³²⁰³⁹⁷⁹⁷
^S^o^u^rce:^Fig^u^re^s^a^r^e^f^r^om^a^budg^e^t^a^u^thority^ta^ble^prov^id^e^d^by^the^H^ous^e^Com^m^itte^e^{on A}^ppropria^tions^{, e}^x^c^e^p^t
^Se^na^te^fⁱ^g^u^r^e^is^f^r^om^budg^e^t^a^u^thor^ity^ta^ble^{in S.R}^e^{pt. 108-}^{342. B}^ecau^se^o^f^dⁱ^f^f^e^riⁿ^g^t^r^eat^m^eⁿ^t^o^f^o^f^f^s^et^s,^t^h^e
^tota^{ls w}^{ill not a}^l^w^a^y^s^m^a^tc^{h the}^A^d^mⁱ^nistra^{tion’s tota}^ls.^T^h^e^fⁱ^g^u^re^s^w^ithin^this^ta^ble^m^a^y^dif^f^e^{r slig}^htly^f^r^om
^thos^e^{in the}^te^x^t^due^{to s}^upple^m^eⁿ^ta^{l a}^ppr^opr^ia^tions^,^r^e^s^c^is^sⁱ^ons^{, a}^{nd othe}^r^f^unding^a^c^tions^{. C}^o^lumⁿ^s^m^a^y^not
^a^{dd due}^{to r}^ounding^or^e^x^c^l^us^{ion of}^s^m^a^lle^r^pr^og^r^a^m^line^-^ite^m^s^.
^*^F^Y^{2004 f}ⁱ^g^u^r^e^s^r^e^f^l^e^c^t^aⁿ^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^{on of}^0.59%^.
^*^*^F^Y^{2005 f}ⁱ^g^u^r^e^s^{do not r}^e^f^l^e^c^t^aⁿ^a^c^r^os^s^-^the^-^boa^r^d^r^e^s^c^is^sⁱ^{on of}^0.80%^.
^***T^h^e^a^p^p^r^o^p^rⁱ^a^tⁱ^oⁿ^s^t^o^t^a^l^d^o^e^sⁿ^o^tⁱⁿ^c^l^u^d^e^t^h^e^lⁱ^mⁱ^t^a^tⁱ^oⁿ^s^oⁿ^o^b^lⁱ^g^a^tⁱ^oⁿ^s^fⁱ^g^u^r^e^f^o^r^t^h^e^F^e^d^e^r^a^l^B^uⁱ^l^dⁱⁿ^g^s^F^und.
Federal Buildings Fund (FBF). Revenue to the FBF is the principal source
of funding. Congress, however, directs the GSA as to the allocation or limitation on
spending of funds.
As agreed to in the conference report (H.Rept. 108-792) on H.R. 4818, the
Consolidated Appropriations Act for FY2005, the House and Senate recommended
that $708.5 million remain available for new construction projects from the $7.2
billion Federal Buildings Fund. An additional $980.2 million is to remain available
for repairs and alterations. The conferees also recommended that the following
amounts be made available from the FBF: $161.4 million for installment acquisition
payments; $3.7 billion for rental of space; and $1.7 for building operations.
The Senate Committee on Appropriations recommended that $710.9 million
remain available until expended for new construction projects from the Federal
Buildings Fund, which totals $7.2 billion. An additional $980.2 million was to
remain available until expended for repairs and alterations. This amount included
$20.0 million to implement a glass fragmentation program; $13.0 million to
implement a chlorofluorocarbons program; and amounts necessary to provide
reimbursable special services such as fencing, lighting, and guard booths on private

or other property not owned by the federal government as may be appropriate to
enable the U.S. Secret Service to perform its protective functions. The Committee
also recommended that the following amounts be made available from the FBF:
$161.4 million for installment acquisition payments; $3.7 billion for rental of space;
and $1.7 billion for building operations.
As passed in the House, H.R. 5025 directs that $522.3 million remain available
until expended for new construction projects from the FBF. An additional $931.2
million was to remain available until expended for repairs and alterations. This
amount also included $20.0 million to implement a glass fragmentation program;
$13.0 million to implement a chlorofluorocarbons program; and amounts necessary
to provide reimbursable special services such as fencing, lighting, and guard booths
on private or other property not owned by the federal government, as may be
appropriate to enable the U.S. Secret Service to perform its protective functions
pursuant to 18 U.S.C. 3056. H.R. 5025 also directed that the following amounts be
made available from the FBF: $161.4 million for installment acquisition payments;
$3.7 billion for rental of space; and $1.7 billion for building operations.
The President’s FY2005 budget requested that $650.2 million remain available
until expended for new construction projects from the Federal Buildings Fund, which
totals $7.2 billion. This amount included $381.0 million for the construction of three
new courthouses. An additional $980.2 million was to remain available until
expended for repairs and alterations. This amount included $135.1 million for
repairs to five existing courthouses; $20.0 million to implement a glass fragmentation
program; $13.0 million to implement a chlorofluorocarbons program; and amounts
to provide such reimbursable fencing, lighting, guard booths, and other facilities on
private or other property not in Government ownership or control as may be
appropriate to enable the United States Secret Service to perform its protective
functions pursuant to 18 U.S.C. 3056.
Electronic Government Fund (E-gov Fund). The fund was ultimately
allocated $3 million in the consolidated appropriations legislation approved by both
houses of Congress. This was $2 million less than the $5 million requested by the
President. The House had provided the amount requested by the President, but the
Senate had approved the $3 million allocation recommended, without any
explanation for the reduction, by its Committee on Appropriations.
Although the President had requested $5 million for the e-gov fund for FY2005,
the account statement in the appendix to the President’s proposed FY2005 budget
stated: “In addition to the $5 million requested for this appropriation, it is proposed
that an additional $40 million will be made available for this activity from surplus
revenues generated in the General Supply Fund.”⁹¹ Those two figures equal the $45
million requested for FY2004, but were $42 million more than the $3 million actually
allocated by Congress for FY2004. The fund received an appropriation of $5 million
in both FY2002 and FY2003.

⁹¹ U.S. Office of Management and Budget, Fiscal Year 2005 Budget of the U.S.
Government: Appendix, p. 971.

The account statement for the General Supply Fund explains that it “finances
certain activities within the Federal Supply Service (FSS) and the Federal
Technology Service (FTS)” of GSA. The “FSS offers Federal agencies an extensive
range of commercial services and more than 4 million commercial products.” These
services and products are “provided by commercial suppliers through more than
10,000 FSS contractors. In FY2003, FSS’ business volume was $33.8 billion, and
is projected to be $38.5 billion in FY2005.”⁹²
Funding for the Electronic Government Fund has been a somewhat contentious
matter between the President and Congress. On February 28, 2001, in advance of his
proposed budget for FY2002, the President released: A Blueprint for New
Beginnings: A Responsible Budget for America’s Priorities. Intended as a 10-year
budget plan, the Blueprint, among other innovations, proposed the establishment of
an electronic government account seeded with “$10 million in 2002 as the first
installment of a fund — that will grow to a total of $100 million over three years —
to support interagency electronic Government (e-gov) initiatives.”
Managed by OMB, the fund was foreseen as supporting “projects that operate
across agency boundaries,” facilitating “the development of a Public Key
Infrastructure to implement digital signatures that are accepted across agencies for
secure online communications,” and furthering “the Administration’s ability to
implement the Government Paperwork Elimination Act of 1998, which calls upon
agencies to provide the public with optional use and acceptance of electronic
information, services and signatures, when practicable, by October 2003.”⁹³ About
one month later, on March 22, OMB announced that the Administration had decided
to double the amount to be allocated to the e-gov fund, bringing it to $20 million.⁹⁴
As included in the President’s FY2002 budget, the fund was established as an
account within the General Services Administration (GSA), to be administered by the
Administrator of General Services “to support interagency projects, approved by the
Director of the Office of Management and Budget, that enable the Federal
Government to expand its ability to conduct activities electronically, through the
development and implementation of innovative uses of the Internet and other
electronic methods.”
The President’s initial request for the fund was $20 million, to remain available
until September 30, 2004. Congress, however, appropriated $5 million for the fund
for FY2002, to remain available until expended. Appropriators specified that
transfers of monies from the fund to federal agencies could not be made until 10 days
after a proposed spending plan and justification for each project to be undertaken
using such monies had been submitted to the Committees on Appropriations.
Expressing general support for the purposes of the fund, they also recommended, and

⁹² Ibid., p. 966.
⁹³ U.S. Executive Office of the President, Office of Management and Budget, A Blueprint
for New Beginnings (Washington: GPO, 2001), pp. 179-180.
⁹⁴ William Matthews, “Bush E-gov Fund to Double,” Federal Computer Week, vol. 15, Mar.

26, 2001, p. 8.

both chambers agreed, that the Administration work with the House Committee on
Government Reform and the Senate Committee on Governmental Affairs to clarify
the status of its authorization.
The President’s budget for FY2003 recognized “GSA as operator of the official
federal portal for providing citizens with one-stop access to federal services via the
Internet or telephone” and, therefore, a key agency in implementing the President’s
e-gov vision, which will “require cross-agency approaches that permit citizens,
businesses, and state and local governments to easily obtain services from, and
electronically transact business with the federal government.” In this regard, an
Administration interagency Quicksilver E-Gov Task Force, according to the budget,
had “identified 23 high priority Internet services for early development.”
Seeking $45 million for the e-gov fund, the budget acknowledged that this
amount was “a significant increase over the $20 million requested in 2002,” but
noted that the request “is supported by specific project plans developed by the
Quicksilver Task Force.”⁹⁵ Furthermore, according to the fund account statement,
these monies “would also further the Administration’s implementation of the
Government Paperwork Elimination Act (GPEA) of 1998, which calls upon agencies
to provide the public with optional use and acceptance of electronic information,
services, and signatures, when practicable, by October 2003.”
The House appropriators again rejected the amount requested by the President
and recommended $5 million for the fund, reiterating, as previously, that transfers of
monies from the fund to federal agencies could not be made until 10 days after
submission of project information to the Committees on Appropriations. The House
Committee also declined to recommend an appropriation for the fund as a GSA
account, but did fund it as an account under the jurisdiction of OMB.⁹⁶ Senate
appropriators, however, recommended the full $45 million requested by the
President. Their report stated that OMB “would control the allocation of the fund
and direct its use for information systems projects and affect multiple agencies and
offer the greatest improvements in access and service.”⁹⁷ Final funding, nonetheless,
was $5 million.
The President again requested $45 million for the fund for FY2004. House
appropriators provided $1 million, offered no report language regarding this reduced
amount, but noted that the fund had been authorized by the E-Government Act of

⁹⁵ U.S. Office of Management and Budget, Fiscal Year 2003 Budget of the U.S. Government
(Washington: GPO, 2002), pp. 386-387.
⁹⁶ U.S. Congress, House Committee on Appropriations, Treasury, Postal Service, and
General Government Appropriations Bill, 2003, a report to accompany H.R. 5120, 107^th^nd
Cong., 2 sess., H.Rept. 107-575 (Washington: GPO, 2002), pp. 64, 83.
⁹⁷ U.S. Congress, Senate Committee on Appropriations, Treasury and General Government
Appropriation Bill, 2003, a report to accompany S. 2740, 107^th Cong., 2^nd sess., S.Rept. 107-

212 (Washington: GPO, 2002), p. 77.

2002, which had previously been a matter of concern for appropriators.⁹⁸ This
allocation was subsequently approved by the House. The Senate approved $5 million
for the fund, as recommended by its appropriators. Ultimately, a midpoint
compromise of $3 million was set by conferees and adopted by each chamber.
National Archives and Records Administration (NARA). The custodian
of the historically valuable records of the federal government since its establishment
in 1934, NARA also prescribes policy and provides both guidance and management
assistance concerning the entire life cycle of federal records. It also administers the
presidential libraries system; publishes the laws, regulations, and presidential and
other documents; and assists the Information Security Oversight Office (ISOO),
which manages federal security classification and declassification policy; and the
National Historical Publications and Records Commission (NHPRC), which makes
grants nationwide to help nonprofit organizations identify, preserve, and provide
access to materials that document American history.
The funds ultimately allocated to NARA by the consolidated appropriations
legislation, as approved by both houses of Congress, were a little over $321 million,
an amount very close to the funds recommended by Senator appropriators. This
amount, however, was almost $20 million more than those provided by the House,
and $17 million more than the President’s request. Of this $321 million, the
following distributions were specified: $266.9 for operating expenses, $35.9 for the
electronic records archives, $13.4 for repairs and restoration, and $5 for the NHPRC.
Within the repairs and restoration account, $3 million was specified for a new
regional archives facility in Anchorage, AK, and $2 for repairs and restoration at the
Lyndon B. Johnson presidential library in Austin, TX.
The House had earlier approved the $302.2 million recommended by the
Committee on Appropriations for NARA, a reduction of a little less than $2 million
from the amount sought by the President. This reduction largely fell in the operating
expenses account, for which $264.2 million had been recommended. Amounts
proposed for the electronic records archive and the NHPRC were at the level
requested by the President. An additional $1 million had been recommended above
the $6.1 million requested for repairs and restoration.
The Senate Committee on Appropriations had recommended a little over $320
million for NARA, exceeding the President’s request by $16 million. Of the amount,
$266.9 million was allocated for operating expenses; $35.9 million for electronic
records archives; $12.1 for repairs and restoration; and $5 million for the NHPRC.
The President had requested $304 million for NARA for FY2005, which was
approximately $2.6 million less than the $306.6 million appropriated for FY2004.
The bulk of this new amount, $266.9 million, was sought for operating expenses,
which is approximately $10 million more than the $255 million allocated to this
account for FY2004. In addition, of the requested amount, $6.1 million would have
funded repairs and restoration and $3 million would have been provided to the

⁹⁸ See 116 Stat. 2899 at 2906; 44 U.S.C. § 3604.

NHPRC. These requests were significantly lower than the $13.6 million appropriated
for repairs and restoration and the almost $10 million provided to the NHPRC for
FY2004. When Congress approved $35.7 million for FY2004 for the new electronic
records archive account, $22 million of this amount was designated to remain
available until the end of FY2006. The President requested $35.9 million for this
account for FY2005.
Merit Systems Protection Board (MSPB). The MSPB serves as guardian
of the federal government’s merit-based system of employment. The agency carries
out its mission by hearing and deciding appeals from federal employees of removals
and other major personnel actions. The MSPB also hears and decides other types of
civil service cases, reviews OPM regulations, and conducts studies of the merit
systems. The agency’s efforts are to assure that personnel actions taken involving
employees are processed within the law and that actions taken by OPM and other
agencies support and enhance federal merit principles.
The President’s FY2005 budget proposed an appropriation of $37.3 million for
the MSPB. The FY2004 appropriation was $32.9 million, but after the 0.59%
rescission was reduced to $32.7 million. In addition, up to $2.626 million for
administrative expenses could be transferred from the Civil Service Retirement and
Disability Fund to adjudicate retirement appeals. After the 0.59% rescission, the
amount available for transfer was reduced to up to $2.611 million. The requested
amount is 5.7% more than the FY2004 total funding after the rescission.
As in its FY2004 budget proposal, MSPB again proposed that the funding
previously provided from the trust fund for adjudication of civil service retirement
appeals be requested as part of the agency’s regular appropriation. OMB
recommended this change to simplify financial record keeping. The FY2005 budget
proposal does not specify how much of the requested $37.3 million would be
allocated as transferred funds for adjudication purposes. The House and Senate
Committees on Appropriations in FY2004 did not agree with the proposal and
instead recommended (with the conferees concurring) that the trust fund transfer be
continued. According to the House committee report accompanying H.R. 2989, the
Committee decided
to continue the practice of appropriating funds to MSPB from the Civil Service
Retirement and Disability Fund rather than discontinuing this practice as⁹⁹
requested by the President; this request has not been adequately justified.
The House Committee on Appropriations recommended, and the House passed,
an appropriation of $34.7 million and a trust fund transfer of up to $2.620 million.
The recommended appropriation is $2.6 million less than the President’s request.
According to the committee report accompanying the House bill, “The decrease ...
reflects the Committee’s decision to continue the practice of appropriating funds to
MSPB from the Civil Service Retirement and Disability Fund rather than

⁹⁹ H.Rept. 108-243 (2003), pp. 191-192.

discontinuing this practice as proposed in the budget request as this proposal has not
been adequately justified.”¹⁰⁰
The Senate Committee on Appropriations recommended and the conference
agreement and the law provide an appropriation of $34.7 million, $2.6 million less
than the President’s request. After the 0.80% rescission, the FY2005 funding is
$34.4 million, a reduction of $2.9 million from the President’s request. The
committee report accompanying the Senate bill states that “The decrease from the
President’s request reflects the Committee’s decision to continue the practice of
appropriating funds to MSPB from the Civil Service Retirement and Disability Fund
rather than discontinuing this practice as requested by the President; this request has
not been adequately justified.”¹⁰¹ The Committee recommended and the conference
agreement and the law provide the same amount as the President requested for the
trust fund transfer (up to $2.626 million). After the 0.80% rescission, this amount
would be up to $2.605 million, a reduction of $21,000 from the President’s request.
Office of Personnel Management (OPM). The budget for OPM is
composed of budget authority for both permanent and current appropriations. This
report discusses the budget authority for current appropriations. The agency “is the
central human resources agency for the Federal Government and the primary agency
helping the President carry out his responsibilities in managing the Federal
workforce.” The Strategic Human Resources Policy Division “designs, develops, and
leads the implementation of innovative, flexible, merit-based human resources
policies and strategies that enable Federal agencies to meet their missions and¹⁰²
achieve their goals.” The Human Capital Leadership and Merit System
Accountability Division assists agencies in implementing and assessing human
capital standards. The Human Resources Products and Services Division supports
federal agencies by administering retirement and insurance programs, providing
personnel investigation services, managerial and executive training, and other human
resources services.
The Office of Inspector General (OIG) conducts audits, investigations,
evaluations, and inspections throughout the agency and may issue administrative
sanctions related to the operation of the Federal Employees Health Benefits Program
that “debar from participation in the health insurance program those health care
providers whose conduct may pose a threat to the financial integrity of the program¹⁰³

itself or to the well-being of insurance program enrollees.”
¹⁰⁰ H.Rept. 108-671, p. 148.
¹⁰¹ S.Rept. 108-342, p. 187.
¹⁰² U.S. Office of Personnel Management, Congressional Budget Justification; Performance
Budget Fiscal Year 2005, Feb. 2004, p. 4. (Hereafter referred to as OPM Budget
Justification.)
¹⁰³ FY2005 Budget, Appendix, p. 1060.

The President’s FY2005 budget proposed an appropriation of $18.2 billion for
OPM. This total includes discretionary funding of $131.3 million¹⁰⁴ for OPM
salaries and expenses and $1.627 million for OIG salaries and expenses. It also
includes mandatory funding of $8.1 billion for the government payment for
annuitants of the employees health benefits program,¹⁰⁵ $35 million for the
government payment for annuitants of the employee life insurance program, and $9.8
billion for payment to the civil service retirement and disability fund. Included in
this total as well are trust fund transfers of $128.5 million¹⁰⁶ to the OPM salaries and
expenses account (for administrative expenses for the retirement and insurance
programs) and $16.461 million¹⁰⁷ to the OIG salaries and expenses account (for
administrative expenses to audit, investigate, and provide other oversight of OPM’s
retirement and insurance programs).
According to OPM’s budget submission, the $131.3 million requested for
salaries and expenses “includes $114.876 million in annual funds, $11.415 million
in no-year funds for e-Government (e-Gov) projects, and $5 million in two-year
funds to coordinate and conduct program evaluation and performance measurement.”
The budget submission states that “Annual funds include an increase of $3,042,000...
to provide human capital support, hiring solutions, enhanced IT support, competitive
sourcing studies, and homeland security and emergency response.”¹⁰⁸
With regard to the OIG, the budget reported that the amount requested
will finance more audit staff, special agent criminal investigators, and improved
information systems. OPM expects to reduce the audit cycle to 2.9 years for
FEHBP [Federal Employees Health Benefits Plan] carriers. Total recoveries are
expected to increase by $14 million annually. In 2005, OPM will add audits of
pharmacy benefit managers and expand the scope of audits for the largest
community-rated health plans (comprehensive medical plans commonly referred¹⁰⁹

to as health maintenance organizations) participating in FEHBP.
¹⁰⁴ The total of $131.3 million would be allocated as follows: Enterprise Human Resources
Integration project ($2 million); leading the government-wide initiative to modernize the
federal payroll systems and service delivery ($6.6 million); e-Human Resources Information
System project ($800,000); e-Clearance project ($2 million); and coordination and conduct
of program evaluation and performance measurement ($5 million shall remain available
through September 30, 2006).
¹⁰⁵ The FY2005 Budget, Appendix, at p. 1061, states the FY2005 budget request for the
government payment for annuitants of the employees health benefits program as $8.0
billion. The House Appropriations Committee report accompanying the House bill shows
the FY2005 budget request and the committee’s recommended appropriation for this
account as $8.1 billion.
¹⁰⁶ Of this total of $128.5 million, $27.6 million would fund automation of the retirement
record keeping systems.
¹⁰⁷ This money is for administrative expenses to audit, investigate, and provide other
oversight of OPM’s retirement and insurance programs.
¹⁰⁸ OPM Budget Justification, p. 8.
¹⁰⁹ FY2005 Budget, Appendix, p. 1060.

The FY2004 appropriation for OPM was $17.5 billion after the 0.59%
rescission. The requested amount for FY2005 is 4% more than the FY2004 total
funding after the rescission. Specifically, it is 10.5% more than the $118.8 million
appropriated in FY2004 for salaries and expenses after the rescission; 9.3% more
than the $1.5 million for OIG salaries and expenses after the rescission; 12.5% more
than the $7.2 billion for the government payment for annuitants of the employees
health benefits program; the same amount ($35 million) for the government payment
for annuitants of the employee life insurance program; 2.2% less than the $10.0
billion for payment to the civil service retirement and disability fund; 4.9% less than
the $135.1 million for OPM salaries and expenses transferred from trust funds after
the rescission; and 14.8% more than the $14.3 million for OIG salaries and expenses
transferred from trust funds after the rescission.¹¹⁰
The House Committee on Appropriations recommended, and the House passed,
an appropriation of $120.4 million for OPM salaries and expenses, $10.9 million less
than the President’s request. The funds for the enterprise human resources
integration project, the government-wide initiative to modernize the federal payroll
systems and service delivery, the e-human resources information system project, and
the e-clearance project would be allocated in the same manner as the President
requested. The recruitment one stop project would be appropriated $3.3 million. The
appropriations recommended for OIG salaries and expenses, the employees health
benefits program, the employee life insurance program, the Civil Service retirement
and disability fund, and the trust fund transfers to the OPM and OIG salaries and
expenses accounts are the same amounts as the President requested. The trust funds
under the OPM salaries and expenses account would be allocated as the President
requested.
The House Committee on Appropriations’ committee report accompanying the
House bill lists appropriations for specific programs as follows: performance culture
under strategic human resources policy should not exceed the FY2004 funding level
of $5.8 million, providing advice to agencies under human capital leadership merit
systems accountability should not exceed the FY2004 funding level of $16.8 million,
the compliance program under human capital leadership merit systems accountability
should not exceed the FY2004 funding level of $16.5 million, management strategy
is funded at $46.2 million, E-gov initiative fees are not funded, completion of the
current retirement readiness project is funded at $250,000, and expansion of the
project to non-federal government employees is funded at $500,000. Within 60 days
of the act’s enactment, OPM is directed to submit an operating plan for FY2005,
signed by the Director, to the House and Senate Committees on Appropriations. The

¹¹⁰ The FY2004 appropriation prior to the 0.59% rescission was $119.5 million for salaries
and expenses, $1.5 million for OIG salaries and expenses, $135.9 million for OPM salaries
and expenses transferred from trust funds, and $14.4 million for OIG salaries and expenses
transferred from trust funds. The amounts of $7.2 billion, $35 million, and $10 billion for
FY2004 are from P.L. 108-199. OPM notifies the Secretary of the Treasury of the “such
sums as may be necessary” to fund these accounts each fiscal year. The FY2005 budget
appendix states that the FY2005 estimates for these accounts are $8.0 billion, $35 million,
and $9.8 billion. (p. 1061) The House Appropriations Committee report accompanying the
House bill shows the FY2005 budget request and the committee’s recommended
appropriation for the employees health benefits program as $8.1 billion.

plan “should include funding levels for the various offices, programs and initiatives
covered in the budget justification and supporting documents referenced in the House
and Senate appropriations reports, and the statement of the managers.” According to
the committee report
The Committee finds that the budget justification materials are severely lacking
in any real detail about the programs proposed or underway at OPM and the
resources involved. Many of the verbose descriptions in the budget justification
did not provide concrete information on the programs, activities and funding¹¹¹
requirements and changes to OPM’s work.”
Additionally, OPM is directed “to include with the ‘Annual Report on Locality-
Based Comparability Payments for the General Schedule’ in FY2005 and all future
fiscal years a report comparing the total pay and non-pay compensation packages of
the Federal workforce and the private sector” and, within 30 days of the act’s
enactment, “respond to the formal request of the Butner Low Security Correctional
Institution regarding its petition on the Central Carolina/Richmond-Petersburg wage
area.”¹¹² The committee report notes that OPM’s decision to make health savings
accounts a part of the federal employees’ benefits package is welcomed.
The Senate Committee on Appropriations recommended an appropriation of
$130.6 million for OPM salaries and expenses which is $691,000 less than the
President’s request. The total would be allocated as follows: Enterprise Human
Resources Integration project ($1.9 million); leading the government-wide initiative
to modernize the federal payroll systems and service delivery ($6.2 million); e-
Human Resources Information System project ($748,000); e-Clearance project ($1.9
million); and coordination and conduct of program evaluation and performance
measurement ($5 million would remain available through September 30, 2006). The
committee report accompanying the Senate bill states that “no more than $10,724,000
is to be used for e-Government projects.”¹¹³
The Committee recommended funding in the same amounts as the President
requested for OIG salaries and expenses, the employees health benefits program, the
employee life insurance program, the Civil Service retirement and disability fund,
and the trust fund transfers to the OPM and OIG salaries and expenses accounts. Of
the total transferred from trust funds to the OPM salaries and expenses account
($128.5 million), $27.6 million would fund automation of the retirement record
keeping systems.
The Senate bill also would provide that none of the funds appropriated or made
available under this act or any other appropriations act could be used to implement
or enforce restrictions or limitations on the Coast Guard Congressional Fellowship
Program, or to implement OPM’s proposed regulations, relating to the detail of
executive branch employees to the legislative branch, published in the Federal
Register on September 9, 2003. If the proposed regulations are final on this act’s

¹¹¹ H.Rept. 108-671, pp. 152-153.
¹¹² Ibid., p. 153.
¹¹³ S.Rept. 108-342, p. 193.

enactment date, none of the funds appropriated or made available under this act could
be used to implement, administer, or enforce such final regulations.
The Senate Committee on Appropriations directs the GAO, in consultation with
OPM and the GSA, to study the child care needs of federal employees in executive,
legislative, and judicial branch agencies. GAO is “to provide guidance and
recommendations of possible options to develop and evaluate additional child care
facility needs and how best to serve the needs of all Federal employees.” OPM is
directed “to reevaluate its efforts to provide information and education to agencies”
on programs which provide subsidized child care for lower income employees.¹¹⁴
With regard to OPM’s ongoing program to automate and streamline the
processes for administering the federal retirement program, the Committee
recommends that OPM continue to seek GAO guidance and support. The GAO is
directed “to do a comprehensive audit on the problems and any mismanagement of
the modernization project.”¹¹⁵
The conference agreement and the law provide an appropriation of $125.5
million for OPM salaries and expenses, of which $12 million shall remain available
until September 30, 2007. This amount is $5.8 million less than the President’s
request. Funding in the same amounts as the President requested is provided for OIG
salaries and expenses, the employees health benefits program, the employee life
insurance program, the Civil Service retirement and disability fund, and the trust fund
transfers to the OPM and OIG salaries and expenses accounts. Of the money
appropriated for the trust fund transfer from the OPM salaries and expenses account,
$27.6 million shall remain available until expended for the cost of automating the
retirement recordkeeping systems. After the 0.80% rescission, the FY2005 funding
for OPM salaries and expenses is $124.5 million, for OIG salaries and expenses is
$1.614 million, for the trust fund transfer from the OPM salaries and expenses
account is $127.4 million, and from the OIG salaries and expenses account is
$16.329 million. These amounts represent reductions from the President’s request
of $6.8 million, $13,000, $1.1 million, and $132,000, respectively.
According to the conference report, the conferees
have not included bill language identifying specific resource levels for various
e-gov projects ... but direct the Office not to exceed the funding levels for the
following projects: $1,870,000 for the enterprise human resources integration
project, $6,219,000 for the federal payroll project, $748,000 for the e-human
resources information system project, and $1,887,000 for the e-clearance project.
To accommodate the obligation rate of these projects ... $12,000,000 of the funds
are made available until September 30, 2007. No funds are provided for the
recruitment one stop project or the program evaluation and performance
assessment project.
provide $250,000 to complete the retirement readiness project [and] ... urge the
Office to expand the ... project to non-federal employees.

¹¹⁴ Ibid.
¹¹⁵ Ibid., pp. 193-194.

allow the Director the flexibility to allocate the budget resources consistent with
the direction provided in this statement of the managers and the budget
justifications. The conferees reiterate the direction in the House report to submit
an operating plan within 60 days of enactment of this Act to the House and
Senate Committees on Appropriations detailing program funding levels for fiscal
year 2005.
reiterates the House direction to the Director to respond to the Butner Low
Security Correctional Institution petition within 30 days of enactment of this Act.
direct the Director to submit a report by March 4, 2005 comparing the pay and
non-pay compensation packages of the Federal workforce and the private sector.
expect OPM and GSA, with technical assistance from GAO, to work
collaboratively to collect data on child care needs, analyze options to meet the
identified needs, and provide the data and analysis to GAO. The conferees direct
GAO to review the data and analyses and provide an evaluation of the results to
the Committees on Appropriations. The conferees expect an update on the status
of these efforts 90 days after enactment of this Act ... the conferees reiterate the
Senate direction to the Office to reevaluate efforts to inform low-income¹¹⁶
employees of programs to assist with child care expenses.
Human Capital Performance Fund. The President’s FY2005 budget
proposed an appropriation of $300 million for this fund. The FY2004 appropriation
was $1 million, but after the 0.59% rescission was $994,000. The fund
is designed to create performance-driven pay systems for employees and
reinforce the value of employee performance management systems. It will
provide additional pay over and above any annual, across-the-board pay raise to
certain civilian employees based on individual or organizational performance
and/or other critical agency human capital needs. Ninety percent of funds
appropriated are to be distributed to agencies on a pro rata basis, upon OPM
approval of an agency’s plan. The remainder, and any amount withheld from¹¹⁷
agencies due to inadequate plans, will be allocated at the discretion of OPM.
The House Committee on Appropriations recommended, and the House passed,
an appropriation of $12.5 million. This amount is $287.5 million less than the
President’s request. The House bill would allow the OPM Director to determine and
transfer to federal agencies such amounts as necessary to carry out the purposes of
the fund. No funds would be obligated or transferred until the Director has notified
the relevant subcommittees of the Committees on Appropriations of the approval of
an agency’s performance plan and the prior approval of such subcommittees has been
obtained. OPM is directed to report annually to the House and Senate Appropriations
Committees “on the performance pay plans that have been approved, and the
amounts that have been obligated or transferred.”¹¹⁸

¹¹⁶ Congressional Record, daily edition, vol. 150, Nov. 19, 2004, p. H10822.
¹¹⁷ FY2005 Budget, Appendix, p. 1060.
¹¹⁸ H.Rept. 108-671, p. 155.

The Senate Committee on Appropriations did not recommend and the
conference agreement and the law do not provide funding for the performance fund.
The committee report accompanying the Senate bill states that such an initiative
“should be budgeted and administered within the salaries and expenses of each
individual agency.”¹¹⁹
Office of Special Counsel (OSC). The agency investigates federal
employee allegations of prohibited personnel practices and, when appropriate,
prosecutes matters before the Merit Systems Protection Board; provides a channel for
whistle blowing by federal employees; and enforces the Hatch Act. In carrying out
the latter activity, the OSC issues both written and oral advisory opinions. The OSC
may require an agency to investigate whistle blower allegations and report to the
Congress and the President as appropriate.
The President’s FY2005 budget proposed an appropriation of $15.449 million
for the OSC. The FY2004 appropriation was $13.5 million, but after the 0.59%
rescission was reduced to $13.4 million. The requested amount is 15.1% more than
the FY2004 funding after the rescission. According to the budget, the funding “will
enable OSC to hire the additional staff needed to increase the case closure rate.
Without additional staff, case backlogs will continue to increase at OSC.”¹²⁰
The House and Senate Committees on Appropriations recommended, the House
passed, and the conference agreement and the law provide the same amount as the
President requested. After the 0.80% rescission, the FY2005 funding is $15.325
million, a reduction of $124,000 from the President’s request. Aware of OSC’s
critical need for more staff to address its case backlog of more than three years, the
committee report accompanying the Senate bill states that “the Committee expects
OSC to acquire an appropriate mix of new staff that will maximize its ability to
reduce this backlog” instead of hiring just attorneys. No later than March 31, 2005,
OSC must report to the Committees on Appropriations on “the status of its staffing
efforts, particularly describing those new positions hired and how the reduction of
OSC’s case backlog has benefitted as a result of the new personnel.”¹²¹
Postal Service. The U.S. Postal Service (USPS) is self-supporting; it
generates nearly all of its funding — about $69 billion annually — by charging users
of the mail for the costs of the services it provides. It does receive a regular
appropriation from Congress, however, to compensate for revenue it forgoes in
providing, at congressional direction, free mailing privileges for the blind and
visually impaired and for overseas voting. The appropriation is termed for “revenue
forgone,” because it is intended to reimburse USPS for the revenue it would have
collected from the blind and state voting offices if Congress had not chosen to
subsidize these services through appropriations. The terrorist attacks in the fall of

2001, however, including use of the mail for delivery of anthrax spores to

¹¹⁹ S.Rept. 108-342, p. 196.
¹²⁰ FY2005 Budget, Appendix, p. 1172.
¹²¹ S.Rept. 108-342, p. 197.

congressional and media offices, generated new funding needs for bio-terrorism
detection that USPS contends should be met through appropriations.
Under the Revenue Forgone Reform Act of 1993, Congress is authorized to
reimburse USPS $29 million each year until 2035, for services provided below cost
to non-profit organizations at congressional direction in the 1990s, but not paid for
at the time. For the past 11 years, the Postal Service appropriation has consisted of
that amount, plus an estimate of the amount needed to pay for mail for the blind and
overseas voters for the current year. There is also a reconciliation adjustment
reflected in the current year budget to bring actual payments into line with past
estimates. (For more information, see CRS Report RS21025, The Postal Revenue
Forgone Appropriation: Overview and Current Issues, by Nye Stevens.)
In FY2004, USPS received a revenue forgone appropriation of $65.5 million,
including $36.5 million for revenue forgone in FY2004 but not payable until October
1, 2004, and the $29 million due annually under the Revenue Forgone Reform Act
of 1993. The actual estimate for revenue forgone in FY2004 was $55.7 million, but
it was reduced by $19.2 million as a reconciliation adjustment to reflect actual versus
estimated free mail volume in 2001.
In its FY2005 Budget, the Administration proposed an appropriation of $61.7
million, including $55.6 million for revenue forgone in FY2005. The Postal Service
estimated that the FY2005 amount would be $69.8 million, or $14.2 million more
than OMB requested, and asked Congress to appropriate that amount. Either amount
would be supplemented by a $6.1 million reconciliation adjustment reflecting that
actual use of the subsidy in FY2002 was underestimated by that amount. The
Administration’s budget proposed that the $61.7 million would not be available for
obligation until October 1, 2005, which is in FY2006. However, USPS will have
available for obligation during FY2005 the $36.5 million provided for revenue
forgone in fiscal 2004. In its FY2002 Budget, the Bush Administration had proposed
to “reverse the misleading budget practice of using advance appropriations simply
to avoid [annual] spending limitations.” The Administration has not renewed the
proposal in its three subsequent budgets.
The Postmaster General, in testimony before the House Appropriations
Subcommittee on Transportation, Treasury, and Independent Agencies on February
26, 2004, complained about the $14.2 million cut proposed by OMB in FY2005
revenue forgone. He said that it would “only compound the financial burden caused”
by the recent practice of delaying the revenue forgone payment until the year after
that in which the services are rendered.
Of greater consequence was the fact that the Administration’s FY2005 budget
did not include the usual $29 million annual payment for revenue forgone in past
years that is set forth in the Revenue Forgone Reform Act. As explained above, the
act authorized annual payments to USPS of $29 million through the year 2035. For

11 years the payment was provided as a matter of course. In its FY2005 budget,

however, the Bush Administration proposed to provide no funds for the payment, and
included it in the list of 65 “terminations to discretionary programs” in the budget.
In response to questions on the matter, OMB pointed out that the Revenue Forgone

Reform Act of 1993 only authorized the appropriations, and many programs across
government are not funded at the levels contemplated in authorization acts.
OMB also mentioned that Congress and the Administration had relieved USPS
of the obligation (in P.L. 108-18, the Postal Civil Service Retirement System
Funding Reform Act of 2003) to pay $3 billion per year for pension costs and that,
as a result, USPS had $3.8 billion in net income in 2003. (For more on relieving
USPS of this obligation, which would have over-funded postal pensions by $78
billion, see CRS Report RL31684, Funding Postal Service Obligations to the Civil
Service Retirement System, by Patrick Purcell and Nye Stevens, and CRS Report
RL32346, Pension Issues Cloud Postal Reform, by Nye Stevens.) USPS, on the
other hand, argues that cancelling the payment could result in the whole 30-year
obligation, totaling $899 million, being written off as a bad debt and charged to
current postal ratepayers. (This issue is discussed further in CRS Report RS21025,
The Postal Revenue Forgone Appropriation: Overview and Current Issues, by Nye
Stevens.)
In its detailed justification of its FY2005 budget request, USPS asked Congress
for an additional $779 million in emergency response funds to protect the safety of
employees and customers from threats such as the 2001 anthrax attack. The funds
would be used to continue acquisition and deployment of ventilation and filtration
equipment that was begun with $762 million provided in FY2002 specifically for
emergency response. The Administration’s FY2005 Budget does not include any
additional funds for emergency preparedness for the Postal Service.
The House Committee on Appropriations recommended, and the House passed,
the amounts requested in the President’s budget, including $61.7 million as an
advance appropriation not available until FY2006, and elimination of the
appropriation for revenue forgone in past years. In its report, the House Committee
on Appropriations expressed concern that OMB had not given sufficient attention to
the safety and security of the nation’s mail system in its FY2005 budget request, and
directed OMB to report within 90 days of the bill’s passage on the amount of federal
(i.e. budgetary) funding necessary to complete work on securing the mail system.
Postal issues were not brought to the House floor preceding the passage of the House
Transportation, Treasury and General Government appropriations bill (H.R. 5025)
on September 22.
The Senate Committee on Appropriations, in its report on S. 2806, was more
generous toward the Postal Service than either the Administration or the House in its
bill. In addition to the amounts requested by the Administration and reflected in the
House bill, the Senate Committee recommended that the $29 million payment for
past revenue forgone be continued in FY2005. It also recommended the
appropriation of $507 million to an Emergency Preparedness Account for USPS to
reimburse it for past and future expenditures on a biohazard detection program,
ventilation and filtration equipment, and the construction of a mail irradiation facility
in Washington, DC, for the local irradiation of government mail that is now shipped
to a contractor facility in Bridgeport, NJ, and back.

Conferees provided $598 million for the Postal Service for FY2005, an increase
of $502 million over FY2004. This appropriation includes $507 million for
biohazard protection.
Title V: General Provisions
This section of the report discusses, briefly, general provisions such as
government-wide guidance on basic infrastructure and overhead policies that are
customarily included in the Transportation, Treasury, and Independent Agencies
appropriation legislation. Examples are provisions related to the Buy America Act,
drug-free federal workplaces, and authorizing agencies to pay GSA bills for space
renovation and other services. In the past provisions have been included which relate
to specific agencies or programs. For both Transportation- and Treasury-related
general provisions and government-wide general provisions, with noted exceptions,
the sections discussed here will be those which are new in the FY2005 budget or
which contain modified policies. There are also general provisions at the end of each
individual title within the bill which relate only to agencies and accounts within that
title.
The Administration’s proposed language for government-wide general¹²²
provisions can be found in the FY2005 Budget Appendix. Most of the general
provisions continued language which has appeared under that title for several years.
For an array of reasons, Congress has determined that reiterating the language is
preferable to placing the provisions in permanent law.
The Administration recommended dropping several such provisions. The
provisions are shown in Table 10.

¹²² FY2005 Budget, Appendix, pp. 9-17.

Table 10. Summary of Proposed Changes to
Government-wide General Provisions
Administration ProposalsPublic Law
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{609 (F}^Y²⁰⁰⁴¹^Section^{609: C}^oⁿ^tin^u^e^th^{e prov}^is^ion^proh^ibitin^g
^Ac^t⁾^w^h^ich^p^r^o^h^ib^{its p}^a^y^m^en^{t to}^p^o^litical^p^a^y^m^en^{ts to}^p^e^r^s^oⁿ^{s f}^illin^g^p^o^s^itioⁿ^s^f^o^r^w^h^ich
^appoiⁿ^t^ees^f^uⁿ^c^tⁱ^oⁿⁱⁿ^gⁱⁿ^j^obs^f^o^{r w}^hⁱ^c^h^t^h^ey^t^h^e^y^ha^ve^b^e^eⁿ^no^mⁱ^na^t^e^d^a^f^t^e^r^t^h^e^Se^na^t^e^ha^s
^ha^ve^b^e^eⁿ^no^mⁱ^na^t^e^d^,^b^u^t^no^t^c^o^nfi^r^m^e^d^.^T^hⁱ^s^v^o^tedⁿ^o^{t to}^ap^p^r^o^v^{e th}^{e n}^o^mⁱⁿ^a^tioⁿ^.
^p^r^o^vⁱ^sⁱ^o^{n ha}^{s b}^e^eⁿⁱⁿ^c^l^ud^e^dⁱⁿ^t^h^e^a^nnua^l
^ap^p^r^o^p^r^iatioⁿ^s^b^{ill f}^o^r^{at least 2}⁰^y^ear^{s. T}^h^e
^prev^iou^s^A^d^mⁱⁿⁱ^s^t^ration^als^o^recom^m^eⁿ^d^ed
^elimⁱⁿ^atin^g^th^{is p}^r^o^v^isioⁿ^.
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{619 (F}^Y²⁰⁰⁴^Section^{619: C}^oⁿ^tin^u^e^th^{e proh}^ibition^of
^A^c^t)^w^h^ich^p^r^o^h^ib^{its th}^{e o}^b^lig^atioⁿ^o^r^ex^pen^d^itu^res^f^o^{r em}^ploy^{ee train}ⁱⁿ^gⁿ^o^{t directly}
^ex^pen^dⁱ^t^u^{re of}^appropri^a^t^e^{d f}^uⁿ^d^s^f^o^{r em}^pl^oy^ee^rel^a^t^e^{d t}^o^t^h^{e perf}^orm^aⁿ^{ce of}^of^fⁱ^ci^al^du^tⁱ^e^s^.
^tr^ainⁱⁿ^g^w^h^en^{it: is n}^o^{t d}ⁱ^r^ectly^r^e^lated^to^th^e
^em^ploy^ee’^s^of^fⁱ^{cial du}^ties^;^m^a^yⁱⁿ^du^{ce h}ⁱ^g^h
^lev^e^{ls o}^f^em^o^tioⁿ^a^{l r}^e^sp^oⁿ^{se o}^r^p^s^y^c^h^o^lo^gⁱ^cal
^str^e^{ss in}^so^m^e^p^a^r^ticip^an^{ts; f}^a^{ils to}ⁱⁿ^f^o^r^m^r^e^:
^cou^r^s^e^con^t^en^{t or pos}^t-^cou^r^s^e^ev^alu^a^tion^;
^con^t^ain^s^m^e^th^ods^{or con}^t^en^{t “}^a^s^s^o^{ciated w}^ith
^r^e^lig^io^u^s^o^r^q^u^asi-^r^e^lig^io^u^s^b^e^lief^sy^stem^{s o}^r
^‘ⁿ^ew^ag^e’^belief^s^y^s^t^em^s^;^{” an}^{d is}^of^f^eⁿ^s^iv^{e to,}
^{or des}ⁱ^gⁿ^e^{d t}^o^ch^an^g^e^{, part}ⁱ^cⁱ^p^an^t^s^’^pers^on^al
^v^a^lu^es^{or lif}^es^ty^les^aw^ay^f^r^om^th^{e w}^o^rk^place.
^E^lim^ina^tio^{n o}^f^la^ngua^ge^{in the}^b^{ill sinc}^e^the
^mⁱ^d-^1990s^w^a^s^requ^es^t^e^{d prev}ⁱ^o^u^s^l^y^by^bot^h
^th^{e B}^u^sh^A^d^mⁱⁿⁱ^str^a^tioⁿ^an^d^th^{e Clin}^toⁿ
^A^d^mⁱⁿⁱ^st^r^a^tⁱ^o^n.
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{620 (F}^Y²⁰⁰⁴^Section^{620: C}^oⁿ^tin^u^e^th^{e proh}^ibition^of
^A^c^t)^w^h^ich^p^r^o^h^ib^{its th}^{e u}^s^{e o}^f^ap^p^r^o^p^r^iated^e^x^p^e^ndⁱ^t^u^r^e^{s fo}^r^e^x^e^c^u^tⁱ^{ng no}^n-dⁱ^sc^l^o^sur^e
^f^uⁿ^d^s^{to requ}^{ire an}^{d ex}^ecu^{te em}^ploy^{ee n}^oⁿ^-^ag^r^eem^en^{ts lack}ⁱⁿ^g^w^h^istle-^b^lo^w^e^r^p^r^o^t^ectioⁿ
^dⁱ^sclo^su^r^e^ag^r^eem^en^{ts w}^ith^o^u^{t th}^o^s^e^clau^s^e^s^.
^ag^r^eem^en^{ts h}^a^vⁱⁿ^g^w^h^istle-^b^lo^w^e^r^p^r^o^t^ectioⁿ
^c^l^a^u^se^s.^T^hⁱ^s^p^r^o^vⁱ^sⁱ^o^{n ha}^{s b}^e^eⁿⁱⁿ^t^h^e^a^nnua^l
^ap^p^r^o^p^r^iatioⁿ^s^b^{ill f}^o^r^o^v^er^ten^y^ear^{s; th}^{e B}^u^sh
^A^d^mⁱⁿⁱ^s^t^ratⁱ^oⁿ^al^s^o^propos^{ed i}^t^s^elⁱ^mⁱⁿ^atⁱ^oⁿⁱⁿ
ⁱ^t^s^F^Y^{2002 an}^{d F}^Y^{2003 bu}^dg^et^requ^es^t^.
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{623 (F}^Y²⁰⁰⁴^Section^{623: C}^oⁿ^tin^u^e^th^{e proh}^ibition^on
^A^c^t)^w^h^ich^r^e^q^u^ir^{es th}^{at th}^{e Co}^m^m^{ittees o}ⁿ^ex^pen^d^itu^res^f^o^{r th}^{e releas}^{e of}ⁿ^oⁿ^-^pu^blic
^A^ppropri^a^tⁱ^oⁿ^s^approv^{e rel}^eas^{e of}^an^y^“ⁿ^on^-ⁱⁿ^f^o^r^m^atioⁿ^w^ith^o^u^{t th}^{e ap}^p^r^o^v^{al o}^f^th^e
^p^u^b^{lic” in}^f^o^r^m^atioⁿ^su^ch^{as m}^a^ilin^g^o^r^C^o^m^mⁱ^t^t^{ee on}^A^ppropri^a^tⁱ^oⁿ^s^.
^telep^h^oⁿ^{e lists to}^an^y^p^e^r^s^oⁿ^o^r^an^y
^o^r^gaⁿⁱ^z^a^tⁱ^o^{n o}^u^t^sⁱ^d^e^t^h^e^fe^d^e^r^a^l^go^ve^rⁿ^m^e^nt^.
^T^h^{e A}^d^mⁱⁿⁱ^s^t^ration^als^o^requ^es^{ted repeal of}
^t^hⁱ^s^provⁱ^sⁱ^oⁿⁱⁿⁱ^t^s^F^Y^{2003 bu}^dg^et^propos^al^.
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{628 (F}^Y²⁰⁰⁴^Section^{628: C}^oⁿ^tin^u^e^th^{e proh}^ibition^on
^A^c^t)^w^h^ich^p^r^o^h^ib^{its u}^sⁱⁿ^g^ap^p^r^o^p^r^iated^f^uⁿ^d^s^coⁿ^t^r^actin^g^w^ith^p^r^iv^{ate co}^m^p^an^{ies to}^o^p^e^r^a^te
^to^o^p^e^r^a^{te an}^oⁿ^lin^{e em}^p^l^o^y^m^eⁿ^tⁱⁿ^f^o^r^m^atioⁿ^an^on^lin^{e em}^ploy^m^eⁿ^t^application^s^an^d
^se^r^vⁱ^c^e^fo^r^t^h^e^fe^d^e^r^a^l^go^ve^rⁿ^m^e^nt^und^e^r^p^r^o^c^e^ssi^{ng se}^r^vⁱ^c^e^s^fo^r^t^h^e^fe^d^e^r^a^l^go^ve^rⁿ^m^e^nt^.

^certain^circu^m^s^t^an^ces^.

Administration ProposalsPublic Law
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{636 (F}^Y²⁰⁰⁴^No^{t in}^th^{e P}^u^b^{lic L}^a^w^.
^A^c^{t) w}^h^ich^requ^ires^each^departm^eⁿ^t^’^s
^Iⁿ^sp^ecto^r^Gen^e^r^a^{l to}^su^b^m^{it to}^th^{e Co}^m^m^ittees
^oⁿ^A^p^p^r^o^p^r^iatioⁿ^s^{a r}^e^p^o^r^{t d}^e^tailin^g^th^e
^policies^an^{d procedu}^r^esⁱⁿ^{place f}^o^{r g}ⁱ^vⁱⁿ^g^fⁱ^rs^t
^p^r^io^r^ity^to^lo^catin^gⁿ^e^w^o^f^fⁱ^{ces an}^d^o^t^h^e^r
^f^{acilities in}^r^u^r^a^{l ar}^eas.
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{637 (F}^Y²⁰⁰⁴^Section^{637: C}^oⁿ^tin^u^e^th^{e proh}^ibition^on
^A^c^t⁾^w^hⁱ^c^h^prohⁱ^bⁱ^t^s^t^h^{e pu}^rch^a^s^e^of^{a produ}^ct^pu^rch^a^sⁱⁿ^g^produ^ct^s^{or s}^e^rvⁱ^ces^of^f^e^{red by}^t^h^e
^{or s}^e^rvⁱ^{ce of}^f^e^{red by}^t^h^{e F}^e^deral^Pri^s^on^F^e^deral^Pri^s^on^In^du^s^t^ri^es^{, In}^{c., u}ⁿ^l^es^s^t^h^e
^In^du^s^t^ries^{, In}^{c., u}ⁿ^l^es^s^th^{e ag}^en^cy^m^a^kⁱⁿ^g^s^u^ch^ag^en^cy^determⁱⁿ^es^th^{e produ}^{ct or s}^e^rv^ice
^pu^rch^a^s^e^det^e^rmⁱⁿ^es^t^h^at^s^u^ch^produ^ct^or^provⁱ^d^es^t^h^{e bes}^t^v^a^l^u^{e. (Was}^S^ectⁱ^oⁿ^{636 of}^S^.
^s^e^rv^{ice prov}^ides^th^{e bes}^t^v^a^lu^e.^{2806, as}^report^e^d.)
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{640 (F}^Y²⁰⁰⁴^S^ectⁱ^oⁿ^640:^Aⁿ^e^w^provⁱ^sⁱ^oⁿ^provⁱ^dⁱⁿ^g^t^h^at
^A^c^t)^w^h^ich^p^r^o^v^id^{es a 4}^.¹^%ⁱⁿ^cr^{ease in}^r^a^{tes o}^f^th^{e ad}^j^u^stm^eⁿ^tⁱⁿ^r^a^{tes o}^f^b^a^{sic p}^a^y^takⁱⁿ^g
^basⁱ^{c pay}^f^o^{r f}^e^deral^em^pl^oy^ees^uⁿ^d^{er s}^t^at^u^t^ory^ef^f^{ect in}^{FY2005 f}^o^{r f}^e^{deral civ}^ilian^em^ploy^ees
^pay^s^y^s^t^em^s^,^t^a^kⁱⁿ^g^ef^f^ectⁱⁿ^F^Y^{2004 .}^s^h^{all be an}ⁱⁿ^creas^{e of}^{3.5%, th}^{e s}^a^m^e^am^ouⁿ^t
^r^e^q^u^ested^b^y^th^{e A}^d^mⁱⁿⁱ^str^a^tioⁿ^f^o^r^m^ilitar^y
^p^e^r^s^o^nne^l^.^T^h^e^A^d^mⁱⁿⁱ^st^r^a^tⁱ^o^{n r}^e^q^u^e^s^t^e^d^a
^sm^allerⁱⁿ^cr^{ease f}^o^r^civ^ilian^em^p^l^o^y^{ees th}^an
^m^ilitar^y^p^e^r^s^oⁿⁿ^e^{l. T}^h^{is p}^r^o^v^isioⁿ^ech^o^s^a
^prov^is^ionⁱⁿ^th^{e FY2004 b}^{ill th}^{at s}^e^{t th}^{e f}^e^deral
^p^a^yⁱⁿ^cr^{ease f}^o^r^civ^ilian^em^p^l^o^y^{ees at th}^{e sam}^e
^lev^e^{l as th}^{at r}^e^q^u^ested^f^o^r^m^ilitar^y^p^e^r^s^oⁿⁿ^e^{l f}^o^r
^F^Y^{2004. (Was}^S^ectⁱ^oⁿ^{638 of}^H^.^R^.^{5025, as}
^pas^s^e^{d by}^t^h^{e H}^o^u^s^{e, an}^{d S}^ectⁱ^oⁿ^{640 of}^S^.
^{2806, as}^report^e^{d.) S}^{ee “}^G^en^eral^S^c^h^e^du^l^e^Pay^”
ⁱⁿ^th^{e n}^e^x^t^sectioⁿ^o^f^th^{is r}^e^p^o^r^{t f}^o^r^m^o^r^e
ⁱⁿ^f^o^r^m^atioⁿ^.
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{641 (F}^Y²⁰⁰⁴^No^{t in}^th^{e P}^u^b^{lic L}^a^w^.
^A^c^t)^w^h^ich^p^r^o^v^id^{es f}^o^r^th^{e tim}^ely^f^ilin^g^o^f
^r^e^p^o^r^{ts w}^ith^th^{e Fed}^e^r^a^{l Electio}ⁿ^Co^m^mⁱ^ssioⁿ
^usi^{ng o}^v^e^rⁿⁱ^ght^d^e^lⁱ^v^e^r^y^,^p^rⁱ^o^rⁱ^t^y^,^o^r^e^x^p^r^e^s^s
^m^a^il.
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{642 (F}^Y²⁰⁰⁴^S^ectⁱ^oⁿ^636:^C^oⁿ^tⁱⁿ^u^e^t^o^al^l^o^w^ag^en^ci^es^t^o
^A^c^t)^w^h^ich^p^e^r^m^{its ag}^en^{cies to}^p^a^r^ticip^{ate in}^p^a^r^ticip^{ate in}^th^{e f}^r^actioⁿ^a^{l air}^c^r^a^f^t^o^wⁿ^e^r^s^hⁱ^p
^th^{e f}^r^actioⁿ^a^{l air}^c^r^a^f^t^o^wⁿ^e^r^s^hⁱ^p^p^ilo^{t p}^r^o^g^r^a^m^{pilot prog}^ram^u^sⁱⁿ^g^of^fⁱ^{cial trav}^{el f}^uⁿ^d^s^.^(W^as
^u^sⁱⁿ^g^f^uⁿ^d^s^appropri^a^t^e^{d f}^o^{r of}^fⁱ^ci^al^t^r^av^el^.^S^ectⁱ^oⁿ^{635 of}^H^.^R^.^{5025, as}^pas^s^e^{d by}^t^h^e
^H^o^u^s^{e, an}^{d S}^ectⁱ^oⁿ^{638 of}^S^.^{2806, as}
^report^e^d.)
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{643 (F}^Y²⁰⁰⁴^S^ectⁱ^oⁿ^642:^C^oⁿ^tⁱⁿ^u^e^t^o^prohⁱ^bⁱ^t^t^h^e
^A^c^t)^w^h^ich^p^r^o^h^ib^{its th}^{e ex}^p^eⁿ^d^itu^r^e^o^f^f^uⁿ^d^s^ex^p^eⁿ^d^itu^r^e^o^f^f^uⁿ^d^{s f}^o^r^th^{e acq}^uⁱ^sitioⁿ^o^f
^f^o^r^th^{e acq}^uⁱ^sitioⁿ^o^f^ad^d^itioⁿ^a^{l f}^e^d^e^r^a^{l law}^ad^d^itioⁿ^a^{l f}^e^d^e^r^a^{l law}^en^f^o^r^cem^en^{t tr}^ainⁱⁿ^g
^en^f^o^r^cem^en^{t tr}^ainⁱⁿ^g^f^acilities.^f^acilities^.^(W^as^Sec^tion^{641 of}^{S. 2806, as}
^report^e^{d, an}^{d w}^a^sⁿ^o^tⁱⁿ^H^.^R^.^{5025, as}^pas^s^e^d
^by^th^{e Hou}^s^e.)
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{644 (F}^Y²⁰⁰⁴^N^o^tⁱⁿ^t^h^{e Pu}^blⁱ^c^L^a^w^.^(S^ectⁱ^oⁿ^{636 of}^H^.^R^.
^A^c^t)^w^h^ich^r^e^q^u^ir^{es th}^{at n}^o^f^uⁿ^d^{s b}^e^u^s^ed^to^{5025, as}^pas^s^e^{d by}^t^h^{e H}^o^u^s^{e, w}^o^u^l^{d h}^a^v^e
^im^p^l^em^en^{t o}^r^en^f^o^r^{ce r}^e^g^u^l^atioⁿ^s^f^o^r^lo^cality^coⁿ^tin^u^e^d^th^{e p}^r^o^v^isioⁿ^to^p^r^o^h^ib^it
^pay^areas^th^{at are in}^con^s^is^ten^t^w^ith^th^e^ex^p^eⁿ^d^itu^r^e^{s to}^im^p^l^em^en^{t o}^r^en^f^o^r^{ce lo}^cality
^r^eco^m^m^eⁿ^d^atioⁿ^s^o^f^th^{e Fed}^e^r^a^{l Salar}^y^p^a^y^r^e^g^u^l^atioⁿ^s^th^{at ar}^{e in}^coⁿ^s^isten^t^w^ith
^Co^uncⁱ^l^.^Fed^e^r^a^{l Salar}^y^Co^uⁿ^c^{il r}^eco^m^m^eⁿ^d^atioⁿ^s^.)

Administration ProposalsPublic Law
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{646 (F}^Y²⁰⁰⁴^S^ectⁱ^oⁿ^638:^C^oⁿ^tⁱⁿ^u^e^t^o^prohⁱ^bⁱ^t^ex^pen^dⁱ^t^u^res
^A^c^t)^w^h^ich^p^r^o^h^ib^{its f}^uⁿ^d^{s f}^r^o^m^b^eⁱⁿ^g^u^s^ed^to^{to im}^plem^en^{t or en}^f^o^{rce res}^t^riction^s^or
^im^p^l^em^en^{t o}^r^en^f^o^r^{ce r}^e^strⁱ^ctioⁿ^s^o^r^lim^itatioⁿ^s^lim^itatioⁿ^s^oⁿ^th^{e Co}^{ast Gu}^ar^d^Coⁿ^g^r^essioⁿ^al
^on^th^{e C}^o^as^{t Gu}^{ard C}^oⁿ^g^r^es^sⁱ^on^{al Fellow}^s^hⁱ^p^Fello^w^s^hⁱ^p^P^r^o^g^r^a^m^o^r^to^im^p^l^em^en^{t OP}^M’^s
^Pr^og^r^a^m^.^propos^{ed reg}^u^l^atⁱ^oⁿ^s^of^S^e^pt^em^{ber 9, 2003,}
^r^e^latin^g^to^th^{e d}^e^{tail o}^f^ex^ecu^tiv^{e b}^r^an^ch
^em^ploy^ees^{to th}^{e leg}ⁱ^s^l^ativ^{e bran}^ch^{. (W}^as
^S^ectⁱ^oⁿ^{637 of}^H^.^R^.^{5025, as}^pas^s^e^{d by}^t^h^e
^Hou^s^{e, an}^{d w}^a^s^uⁿ^d^{er th}^{e OP}^{M accou}ⁿ^tⁱⁿ^S.
^{2806, as}^report^e^d.)
^R^ecom^m^eⁿ^d^s^elⁱ^mⁱⁿ^atⁱⁿ^g^S^ectⁱ^oⁿ^{648 (F}^Y²⁰⁰⁴^S^ection^{644: C}^oⁿ^tin^u^e^requ^irem^en^{t th}^{at each}
^A^c^{t) w}^h^ich^requ^ires^each^ag^en^cy^{to reim}^bu^rs^e^ag^en^cy^r^e^im^b^u^r^s^{e th}^{e Fed}^e^r^a^{l A}^v^iatioⁿ
^th^{e Fed}^e^r^a^{l A}^v^iatioⁿ^A^d^mⁱⁿⁱ^str^a^tioⁿ^f^o^r^th^e^A^d^mⁱⁿⁱ^str^a^tioⁿ^f^o^r^th^{e o}^p^e^r^a^tioⁿ^o^f^th^{e Mid}^w^ay
^o^p^e^r^a^tioⁿ^o^f^th^{e Mid}^w^ay^A^t^o^{ll A}ⁱ^r^f^ield^.^A^t^ol^l^Aⁱ^rfⁱ^e^l^d^{. (Was}^S^ectⁱ^oⁿ^{645 of}^S^.^{2806, as}
^report^e^{d, an}^{d w}^a^sⁿ^o^tⁱⁿ^H^.^R^.^{5025, as}^pas^s^e^d
^by^th^{e Hou}^s^e.)
^Propos^esⁿ^e^w^s^ectⁱ^oⁿ^{(634) t}^h^at^w^o^u^l^{d al}^l^o^w^S^ectⁱ^oⁿ^533:^Aⁿ^e^w^provⁱ^sⁱ^oⁿ^t^o^al^l^o^w^t^h^e
^th^{e A}^d^mⁱⁿⁱ^str^a^tioⁿ^to^tr^an^sf^er^f^uⁿ^d^{s b}^e^tw^een^t^r^an^s^f^{er of}^u^p^t^o^10%^of^f^uⁿ^d^s^bet^w^een
^accouⁿ^t^s^f^uⁿ^dⁱⁿ^g^operation^sⁱⁿ^th^{e Ex}^ecu^tiv^e^accouⁿ^t^s^f^o^{r th}^{e Ex}^ecu^tiv^{e Of}^fⁱ^{ce of}^th^e
^Of^fⁱ^{ce of}^th^{e P}^r^es^iden^t.^Presⁱ^d^en^t^.^(Wasⁿ^o^tⁱⁿ^H^.^R^.^{5025, as}^pas^s^e^{d by}
^t^h^{e H}^o^u^s^{e, an}^{d S}^.^{2806, as}^report^e^d.)
^Propos^esⁿ^e^w^s^ectⁱ^oⁿ^{(635) t}^h^at^w^o^u^l^{d repeal}^No^{t in}^th^{e P}^u^b^{lic L}^a^w^.
^s^ectⁱ^oⁿ^{754 of}^t^h^{e T}^a^ri^f^f^A^c^t^of^1930.
^Propos^esⁿ^e^w^s^ectⁱ^oⁿ^{(636) t}^h^at^w^o^u^l^{d am}^en^d^N^o^tⁱⁿ^t^h^{e Pu}^blⁱ^c^L^a^w^.^(S^ectⁱ^oⁿ^{642 of}^S^.
^{31 U.S}^.^C^.^{§ 3716 an}^{d place n}^o^tim^{e res}^t^rain^{t on}^{2806, as}^report^e^{d, i}ⁿ^cl^u^d^{ed a n}^e^w^provⁱ^sⁱ^oⁿ
^w^h^en^“^aⁿ^o^f^f^s^{et m}^a^y^b^eⁱⁿ^itiated^o^r^tak^eⁿ^.^”^elimⁱⁿ^atin^g^th^{e ten}^y^ear^lim^itatioⁿ^s^p^e^rⁱ^o^d
^ap^p^licab^{le to}^th^{e o}^f^f^s^{et o}^f^f^e^d^e^r^a^{l n}^oⁿ^-^tax
^pay^m^en^t^s^.)
^Propos^esⁿ^e^w^s^ectⁱ^oⁿ^{(637) t}^h^at^w^o^u^l^{d am}^en^d^N^o^tⁱⁿ^t^h^{e Pu}^blⁱ^c^L^a^w^.^(S^ectⁱ^oⁿ^{643 of}^S^.
^{42 U}^.^S^.^C^.^{§ 653(j}⁾^by^addiⁿ^g^{a n}^e^w^s^ectⁱ^oⁿ^on^{2806, as}^report^e^{d, i}ⁿ^cl^u^d^{ed a n}^e^w^provⁱ^sⁱ^oⁿ
^“^Iⁿ^f^o^r^m^a^tioⁿ^Co^m^p^ar^isoⁿ^{s an}^d^Disclo^su^r^e^to^am^en^diⁿ^g^{42 U}^.^S^.^C^.^§653(j⁾^by^addiⁿ^g^{a n}^e^w
^A^{ssist in}^Fed^e^r^a^{l Deb}^t^Co^llectioⁿ^.^”^sectioⁿ^oⁿ^“^Iⁿ^f^o^r^m^a^tioⁿ^Co^m^p^ar^isoⁿ^{s an}^d
^Disc^lo^sur^e^to^A^{ssist in Fe}^d^e^r^a^{l De}^b^t
^Co^llectioⁿ^”^w^h^ich^p^e^r^m^{its th}^{e Secr}^etar^y^o^f
^Health^an^d^Hu^m^aⁿ^Ser^v^{ices (}^HHS)^to^m^a^tch
ⁱⁿ^f^o^rm^atⁱ^oⁿ^on^pers^on^s^owⁱⁿ^g^delⁱⁿ^qu^en^t^debt
^to^th^{e f}^e^d^e^r^a^{l g}^o^v^e^rⁿ^m^eⁿ^t^w^ithⁱⁿ^f^o^r^m^atioⁿ
^coⁿ^t^ain^e^dⁱⁿ^th^{e HHS Natio}ⁿ^a^{l Dir}^ecto^r^y^o^f
^New^Hires.)
¹^Uⁿ^l^e^ss^ot^h^e^rwⁱ^s^{e i}ⁿ^di^cat^{ed, al}^l^ref^e^ren^ces^t^o^s^ectⁱ^oⁿ^sⁱⁿ^t^h^{e “}^{2004 A}^c^t^”ⁱⁿ^t^hⁱ^s^t^a^bl^{e ref}^e^{r t}^o^t^h^e
^Gen^e^{ral P}^r^ov^is^ion^sⁱⁿ^Divⁱ^sⁱ^on^{F, T}^{itle VI of}^th^{e FY2004 C}^oⁿ^s^olidated^A^ppropriation^s^A^c^{t (P}^.L^{. 108-}
^199).
Federal Personnel Issues
General Schedule Pay. Under the Federal Employees Pay Comparability
Act of 1990 (FEPCA), federal white-collar employees, paid under the General
Schedule (GS) and related salary systems, are to receive pay adjustments each year
based on two separate mechanisms. The first is an adjustment to base pay which is
based on changes in private sector wages and salaries as reflected in the Employment
Cost Index (ECI). The annual pay adjustment is set at the percentage rate of change

in the ECI, minus 0.5, which for January 2005 would be 2.5%. The second
adjustment is a locality-based comparability payment, the size of which is determined
by the President, and is based on a comparison of non-federal and GS salaries in 29
pay areas nationwide. By law, the disparity between non-federal and federal salaries
is to be reduced to 5% in January 2005. If the ECI and locality-based comparability
payments were granted as required by FEPCA in 2005, the nationwide average net
pay increase would be 13.06% and the net pay increase for the Washington, DC, pay
area would be 15.94%.¹²³
The Administration’s FY2005 budget proposed a 1.5% federal civilian pay
adjustment, but did not state how the increase would be allocated between the annual
and locality adjustments.
Concurrent resolutions introduced in the House of Representatives by
Representative Steny Hoyer (H.Con.Res. 356) and in the Senate by Senator Paul
Sarbanes (S.Con.Res. 88) expressed the sense of the Congress that there should
continue to be parity between the pay adjustments for the uniformed military and
federal civilian employees. The resolutions noted the longstanding policy of parity
between both the military and civilian pay increases.
The Concurrent Resolution on the Budget for FY2005 (S.Con.Res. 95) as agreed
to by the Senate, at Section 505, includes a Sense of the Senate provision regarding
pay parity that states that “the rate of increase in the compensation of civilian
employees should be equal to that proposed for the military in the President’s Fiscal
Year 2005 Budget.” S.Con.Res. 95, as agreed to by the House of Representatives,
does not include the provision, and the conference report to accompany the
concurrent resolution (H.Rept. 108-498) also does not include it. The House version
of the Concurrent Resolution on the Budget (H.Con.Res. 393), as agreed to by the
House of Representatives, does not include a Sense of the House provision on pay
parity. An amendment to provide such, offered by Representative James Moran
during House Budget Committee markup of the concurrent resolution, was not
agreed to by a 21 to 15 vote. One argument against supporting the pay parity
amendment was that the job of a member of the uniformed military is more
demanding than that of a civilian employee and the pay adjustment should reflect this
difference.
During discussions surrounding the vote on H.Con.Res. 393, the Speaker of the
House, Representative Dennis Hastert, agreed to allow a separate vote in the House
of Representatives on a pay parity resolution (H.Res. 581) offered by Representative
Tom Davis and 22 cosponsors. As agreed to by the House by a 299 to 126 vote, the
resolution states the Sense of the House that “in FY2005, compensation for civilian
employees ... should be adjusted at the same time, and in the same proportion, as are
rates of compensation for members of the uniformed services.” Section 640 of Title
VI of Division H of the Consolidated Appropriations Act for FY2005 provides a
3.5% pay adjustment for civilian employees, including those employed by the
Departments of Defense and Homeland Security. Section 636 of the House bill

¹²³ See CRS Report RL32355, Federal White-Collar Pay: FY2005 Salary Adjustments, by
Barbara L. Schwemle.

would have prohibited funds in the bill from being “used to implement or enforce
regulations for locality pay inconsistent with recommendations of the Federal Salary
Council,”¹²⁴ but this provision is not included in the Consolidated Appropriations
Act.
Federal Wage System. The Federal Wage System (FWS) is designed to
compensate the federal blue-collar, or skilled labor, force at rates prevailing in local
wage areas for like occupations. If the statutory system were allowed to be
administered as enacted, the wage rates and the rates of adjustment in the over 130
wage areas would vary according to labor costs and compensation in the private
sector. Since 1979, Congress has limited the rates of pay adjustment for blue-collar
workers to the average percentage pay adjustment received by federal white-collar
employees (for FY2004, the limitation is at Section 613 of P.L. 108-199 and for
FY2005, the limitation is at Section 613 of Title VI of Division H of the
Consolidated Appropriations Act for FY2005). Part of the rationale for the limitation
is that, in certain high cost areas, some FWS wages would exceed the salaries paid
to General Schedule supervisors. Wages in the lower cost areas will be allowed to
increase according to the findings of the wage surveys but those in the high cost areas
will be capped. Notwithstanding the cap, under Section 640(b) of P.L. 108-199, for
2004 the blue-collar pay adjustment in a particular location will be no less than the
increase received by GS employees in that location. Blue-collar workers in Alaska,
Hawaii, and other non-foreign areas will receive a pay adjustment that is no less than
the increase received by GS employees in the “rest of the United States” locality pay
area. Language to continue this provision for 2005 is included in Section 640(b) of
Title VI of Division H of the Consolidated Appropriations Act for FY2005.
P.L. 107-117 extended the application of out-of-area wage survey data (known
as the Monroney Amendment) to Department of Defense personnel.
Senior Executive Service Salaries. Changes to the SES pay system —
eliminating the six-tier system, changing the salary setting authority from the
President to the Office of Personnel Management, removing members of the SES
from the locality pay system, and capping pay rates at Level II of the Executive
Schedule — were enacted under the National Defense Authorization Act for
FY2004.¹²⁵ OPM published regulations to implement the law on January 13, 2004.
For January 2005, the minimum SES salary is $104,927 and the maximum salary for
most members of the SES is $145,600. Those employees in agencies with
performance appraisal systems certified by OPM, will be able to receive a maximum
SES salary of $158,100, an amount equal to that of Members of Congress and U.S.
District Court judges.¹²⁶ Proposed regulations to establish a new performance-based
pay system for the SES and a higher aggregate limitation on pay for SES members

¹²⁴ H.Rept. 108-671, p. 162.
¹²⁵ P.L. 108-136, Sec. 1125; Nov. 24, 2003.
¹²⁶ U.S. Office of Personnel Management, “Senior Executive Service Pay and Performance
Awards,” Federal Register, vol. 69, no. 8, Jan 13, 2004, pp. 2047-2052.

were published by OPM on July 29, 2004.¹²⁷ The final regulations were published
by OPM on December 6, 2004.¹²⁸
Human Capital Performance Fund. The Administration’s FY2005 pay
proposal would combine a 1.5% across-the board increase with a performance
component. A $300 million fund would be set aside government-wide to allow
managers to reward top-performing individuals with additional pay over and above
any annual across-the-board pay raise.¹²⁹ See the section on the Office of Personnel
Management above for a discussion. P.L. 108-199 provided an FY2004
appropriation of $1 million for the fund. The Consolidated Appropriations Act for
FY2005 does not provide an appropriation for the fund.
Members of Congress, Judges, and Other Officials. If Congress is
silent on this issue in legislation, the annual adjustment for Members of Congress and
other officials becomes effective automatically. For judges, the annual pay increase
must be specifically authorized. (P.L. 108-167 provided the January 2004 judicial
pay adjustment and Section 306 of Title III of Division B of the Consolidated
Appropriations Act for FY2005 provides the January 2005 pay adjustment.) Since
the authorization has been required, judges have not received lower pay adjustments
than the other officials.¹³⁰ Under the Ethics Reform Act of 1989, as amended, pay
adjustments for federal officials, including Members of Congress and judges, also are
based on ECI calculations, but for a different 12-month period. The ECI calculations
require a pay adjustment of 2.5% in January 2005. The law limits the size of the
adjustment, however, to the rate of adjustment for General Schedule base pay.
President. Pursuant to the Treasury and General Government Appropriations
Act, 2000 (P.L. 106-58), the President’s salary was increased to $400,000 per annum
effective January 20, 2001. Since 1969, Presidents had been paid a salary of
$200,000. Former Presidents receive a pension equal to the rate of pay for Cabinet
Secretaries (currently $175,700) and the pension is adjusted automatically as those
pay rates are changed.¹³¹

¹²⁷ U.S. Office of Personnel Management, “Senior Executive Service Pay and Performance
Awards and Aggregate Limitation on Pay; Proposed Rule,” Federal Register, vol. 69, no.

145, July 29, 2004, pp. 45535-45546.

¹²⁸ U.S. Office of Personnel Management, “Senior Executive Service Pay and Performance
Awards; Aggregate Limitation on Pay,” Federal Register, vol. 69, no. 233, Dec. 6, 2004, pp.

70355-70367.

¹²⁹ FY2005 Budget, Appendix, pp. 1059-1060.
¹³⁰ See also, CRS Report RL30014, Salaries of Members of Congress: Current Procedures
and Recent Adjustments and CRS Report 97-1011, Salaries of Members of Congress: A List
of Payable Rates and Effective Dates, 1789-2004, by Paul E. Dwyer. Also see, CRS Report
RS20388, Salary Linkage: Members of Congress and Other Federal Officials; CRS Report
RS20278, Judicial Salary-Setting Policy; and CRS Report 98-53, Salaries of Federal
Officials: A Fact Sheet, by Sharon S. Gressle.
¹³¹ See CRS Report RS20114, Salary of the President Compared with That of Other Federal
Officials, by Sharon S. Gressle.

Cuba Sanctions¹³²
Since 2000, either one or both houses have approved provisions in the annual
Treasury appropriations bill that would ease U.S. economic sanctions on Cuba. This
year, the House-passed version of the FY2005 Transportation/Treasury
appropriations bill, H.R. 5025, and the Senate Appropriations Committee-reported
version of the bill, S. 2806, had provisions that would have eased Cuba sanctions in
various ways. In its statement of policy on H.R. 5025, the Administration indicated
that the President would veto the measure if it contained provisions weakening Cuba
sanctions.¹³³ Ultimately, the Cuba provisions were not included in the FY2005
omnibus appropriations measure that included the Treasury/Transportation
appropriations measure (Division H of H.R. 4818, H.Rept. 108-792).
Since the early 1960s, U.S. policy toward Communist Cuba under Fidel Castro
has consisted largely of efforts to isolate the island nation through comprehensive
economic sanctions, including a near total trade embargo and prohibitions on U.S.
financial transactions with Cuba. Under U.S. sanctions, commercial medical and food
exports to Cuba are allowed, but with numerous restrictions and licensing
requirements. Exporters are denied access to U.S. private commercial financing or
credit, and all transactions must be conducted in cash in advance or with financing
from third countries. Restrictions on travel have been a key and often contentious
component in U.S. efforts to isolate the Cuban government. The embargo
regulations, known as the Cuban Assets Control Regulations (CACR), are issued by
the Treasury Department’s Office of Foreign Assets Control (OFAC). The
regulations have not banned travel itself, but have placed restrictions on any financial
transactions related to travel to Cuba. Cash remittances to Cuba — estimated to be
$400-$800 million annually — are also regulated by the CACR.
The Bush Administration has tightened travel restrictions on travel and
remittances significantly. In March 2003, the Administration eliminated the category
of people-to-people educational exchanges unrelated to academic coursework. In
June 2004, through new OFAC regulations amending the CACR, the Administration
eliminated the category of fully-hosted travel, restricted family visits to once every
three years under a specific license to visit only immediate family members, and
further restricted travel for educational activities, including the elimination of travel
for secondary schools. The authorized per diem allowed for a family visit was
reduced from the State Department per diem rate, previously $167 per day, to $50 per
day. At the same time, cash remittances to Cuba were restricted to members of the
remitter’s immediate family. The amount allowed is still $300 per quarter, although
authorized travelers are limited to carrying $300 in remittances as opposed to $3,000
previously allowed.
There have been mixed reactions to the Bush Administration’s tightening of
Cuba travel and remittance restrictions. Supporters maintain that the increased

¹³² Prepared by Mark P. Sullivan, Specialist in Latin American Affairs, Foreign Affairs,
Defense, and Trade Division.
¹³³ White House, Executive Office of the President, Office of Management and Budget,
“Statement of Administration Policy, H.R. 5025,” September 14, 2004.

restrictions will deny the Cuban government dollars that help maintain its repressive
control. Opponents argue that the tightened sanctions are anti-family and will only
result in more suffering for the Cuban people.
The House-passed version of H.R. 5025 had three provisions that would have
eased Cuba sanctions. During floor consideration on September 21, 2004, the House
approved a Davis (of Florida) amendment (H.Amdt. 769) by a vote of 225-174,
which provided that no funds could be used to administer, implement, or enforce the
Bush Administration’s June 2004 tightening of restrictions on visiting relatives in
Cuba — this became Section 647 of the bill. On September 22, 2004, the House
approved two additional Cuba amendments by voice vote: a Lee amendment
(H.Amdt. 771) that prohibited funds from being used to implement, administer, or
enforce the Bush Administration’s June 2004 tightening of restrictions on travel for
educational activities — this became Section 648; and a Waters amendment
(H.Amdt. 770) that prohibited funds from being used to implement any sanction
imposed on private commercial sales of agricultural commodities or medicine or
medical supplies to Cuba — this became Section 649. The House also rejected a
Rangel amendment (H.Amdt. 772) on September 22, 2004, by a vote of 225-188 that
would have more broadly prohibited funds from being used to implement,
administer, or enforce the economic embargo of Cuba. During September 15, 2004
House floor consideration of H.R. 5025, Representative Jeff Flake announced his
intention not to offer an amendment, as he had for the past three years, that would
have prohibited funds from being used to administer or enforce restrictions on travel
or travel-related transactions.
The Senate version of the FY2005 Transportation/Treasury appropriations bill,
S. 2806, as reported out of the Senate Appropriations Committee (S.Rept. 108-342)
on September 15, 2004, had a provision (Section 222) that would have prohibited
funds from administering or enforcing restrictions on Cuba travel or travel-related
transactions. That provision, which was proposed by Senator Byron Dorgan, was
unanimously approved by the Subcommittee on Transportation, Treasury and
General Government on September 9, 2004.
For additional information, see CRS Report RL31139, Cuba: U.S. Restrictions
on Travel and Remittances and CRS Report RL31740, Cuba: Issues for the 108^th
Congress.

Appendix 1: List of Transportation Acronyms
ARC: Amtrak Reform Council
AIP: Airport Improvement Program (FAA)
AIR21: the Wendell H. Ford Aviation Investment and Reform Act for the 21st
Century (P.L. 106-181), the current aviation authorizing legislation
ARAA: the Amtrak Reform and Accountability Act of 1997 (P.L. 105-134), the
current Amtrak authorizing legislation
ATSA: the Aviation and Transportation Security Act (P.L. 107-71), legislation which
created the Transportation Security Administration within the DOT
BRR: Bridge Replacement and Rehabilitation program (FHWA)
BTS: Bureau of Transportation Statistics
CG: Coast Guard
CMAQ: Congestion Mitigation and Air Quality program (FHWA)
DOT: Department of Transportation
EAS: Essential Air Service (FAA)
F&E: Facilities and Equipment program (FAA)
FAA: Federal Aviation Administration
FAHP: Federal-Aid Highway Program (FHWA)
FAIR21: the Wendell H. Ford Aviation Investment and Reform Act for the 21st
Century (P.L. 106-181), the current aviation authorizing legislation
FHWA: Federal Highway Administration
FRA: Federal Railroad Administration
FTA: Federal Transit Administration
Hazmat: Hazardous materials (safety program in RSPA)
HPP: High Priority Projects (FHWA)
HTF: Highway Trust Fund
IM: Interstate Maintenance program (FHWA)

ITS: Intelligent Transportation Systems (FHWA)
MCSAP: Motor Carrier Safety Assistance Program (FMCSA)
New Starts: part of the FTA’s Capital Grants and Loans Program which funds new
fixed-guideway systems or extensions to existing systems
NHS: National Highway System; also a program within FHWA
NHTSA: National Highway Traffic Safety Administration
NMCSA: National Motor Carrier Safety Administration
O&M: Operations and Maintenance program (FAA)
OIG: Office of the Inspector General of the DOT
OST: Office of the Secretary of Transportation
RABA: Revenue-Aligned Budget Authority
RD&T: Research, Development and Technology program (FHWA)
RE&D: Research, Engineering and Development program (FAA)
RSPA: Research and Special Projects Administration
SCASD: Small Community Air Service Development program (FAA)
STB: Surface Transportation Board
STP: Surface Transportation Program (FHWA)
TCSP: Transportation and Community and System Preservation Program (FHWA)
TEA-21: Transportation Equity Act for the 21^st Century (P.L. 105-178), the current
highway and transit authorizing legislation
TIFIA: Transportation Infrastructure Finance and Innovation Act program (FHWA)
TSA: Transportation Security Administration

Appendix 2: The Transportation
Appropriations Framework
Transportation is function 400 in the annual unified congressional budget. It is
also considered part of the discretionary budget. Funding for the DOT budget is
derived from a number of sources. The majority of funding comes from dedicated
transportation trust funds. The remainder of DOT funding is from federal Treasury
general funds. The transportation trust funds include the highway trust fund, which
contains two accounts, the highway trust account and the transit account; the airport
and airway trust fund; and the inland waterways trust fund. All of these accounts
derive their respective funding from specific excise and other taxes.
In FY2002 trust funds accounted for well over two-thirds of total federal
transportation spending. Together, highway and transit funding constitute the largest
component of DOT appropriations. Most highway and transit programs are funded
with contract authority derived by the link to the highway trust fund. This is very
significant from a budgeting standpoint. Contract authority is tantamount to, but
does not actually involve, entering into a contract to pay for a project at some future
date. Under this arrangement, specified in Title 23 U.S.C., authorized funds are
automatically made available at the beginning of each fiscal year and may be
obligated without appropriations legislation; although appropriations are required to
make outlays at some future date to cover these obligations.
Where most federal programs require new budget authority as part of the annual
appropriations process, transportation appropriators are faced with the opposite
situation. That is, the authority to spend for the largest programs under their control
already exists, and the mechanism to obligate funds for these programs also is in
place.
Transportation Equity Act for the 21^st Century (TEA-21)
During the 105^th and 106^th Congresses, major legislation changed the
relationships between the largest transportation trust funds and the federal budget.^st
The Transportation Equity Act for the 21 Century (TEA-21) (P.L. 105-178) linked
annual spending for highway programs directly to revenue collections for the
highway trust fund. In addition, core highway and mass transit program funding was
given special status in the discretionary portion of the federal budget by virtue of the
creation of two new budget categories. The act thereby created a virtual “firewall”
around highway and transit spending programs. The funding guarantees were set up
in a way that makes it difficult for funding levels to be altered as part of the annual
budget/appropriations process. Additional highway funds can be provided annually
by a mechanism called “Revenue Aligned Budget Authority” (RABA); RABA funds
accrue to the trust fund as a result of increased trust fund revenues. For FY2003,
however, the RABA adjustment, if it had been applied during the appropriations
process, would have led to a significant and unexpected drop in the availability of
highway obligational funding. Congress set the RABA adjustment for FY2003 to $0
(in a provision in P.L. 107-206) and appropriators ultimately provided FY2003
highway funding at the same level as provided for FY2002 (which was $4 billion

higher than the FY2003 authorized level). RABA was not included in the FY2004
appropriations calculations.
TEA-21 changed the role of the House and Senate appropriations and budget
committees in determining annual spending levels for highway and transit programs.
The appropriations committees are precluded from their former role of setting an
annual level of obligations. These were established by TEA-21 and are adjusted by
an annual RABA computation. In addition, it appears that TEA-21 precludes, at least
in part, the House and Senate appropriations committees from exercising what some
Members view as their once traditional option of changing spending levels for
specific core programs or projects. In the FY2000 appropriations act, the
appropriators took some tentative steps to regain some of their discretion over
highway spending. The FY2000 Act called for the redistribution of some funds
among programs and added two significant spending projects. In the FY2001
appropriations act, the appropriators continued in this vein by adding funds for large
numbers of earmarked projects. Further, the FY2001 Act called for redirection of a
limited amount of funding between programs and includes significant additional
funding for some TEA-21 programs. This trend continued, and even accelerated, in
the FY2002 Act as appropriators made major redistributions of RABA funds and, in
some instances, transferred RABA funds to agencies that are not eligible for RABA
funding under TEA-21.

Appendix 3: Transportation Budget Terminology
Transportation budgeting uses a confusing lexicon (for those unfamiliar with the
process) of budget authority and contract authority — the latter, a form of budget
authority. Contract authority provides obligational authority for the funding of trust
fund-financed programs, such as the federal-aid highway program. Prior to TEA-21,
changes in spending in the annual transportation budget component had been
achieved in the appropriations process by combining changes in budget/contract
authority and placing limitations on obligations. The principal function of the
limitation on obligations is to control outlays in a manner that corresponds to
congressional budget agreements.
Contract authority is tantamount to, but does not actually involve, entering into
a contract to pay for a project at some future date. Under this arrangement, specified
in Title 23 U.S.C., which TEA-21 amended, authorized funds are automatically made
available to the states at the beginning of each fiscal year and may be obligated
without appropriations legislation. Appropriations are required to make outlays at
some future date to cover these obligations. TEA-21 greatly limited the role of the
appropriations process in core highway and transit programs because the act
enumerated the limitation on obligations level for the period FY1999 through
FY2003 in the Statute.
Highway and transit grant programs work on a reimbursable basis: states pay
for projects up front and federal payments are made to them only when work is
completed and vouchers are presented, months or even years after the project has
begun. Work in progress is represented in the trust fund as obligated funds and
although they are considered “used” and remain as commitments against the trust
fund balances, they are not subtracted from balances. Trust fund balances,
therefore, appear high in part because funds sufficient to cover actual and expected
future commitments must remain available.
Both the highway and transit accounts have substantial short- and long-term
commitments. These include payments that will be made in the current fiscal year
as projects are completed and, to a much greater extent, outstanding obligations to
be made at some unspecified future date. Additionally, there are unobligated
amounts that are still dedicated to highway and transit projects, but have not been
committed to specific projects.
Two terms are associated with the distribution of contract authority funds to the
states and to particular programs. The first of these, apportionments, refers to funds
distributed to the states for formula driven programs. For example, all national
highway system (NHS) funds are apportioned to the states. Allocated funds, are
funds distributed on an administrative basis, typically to programs under direct
federal control. For example, federal lands highway program monies are allocated;
the allocation can be to another federal agency, to a state, to an Indian tribe, or to
some other governmental entity. These terms do not refer to the federal budget
process, but often provide a frame of reference for highway program recipients, who
may assume, albeit incorrectly, that a state apportionment is part of the federal budget
per se