State, Foreign Operations, and Related Programs: FY2008 Appropriations
State, Foreign Operations, and Related Programs:
Updated January 31, 2008
Specialist in Foreign Assistance
Foreign Affairs, Defense, and Trade Division
Susan B. Epstein
Specialist in Foreign Policy and Trade
Foreign Affairs, Defense, and Trade Division
State, Foreign Operations, and Related Programs:
The annual State, Foreign Operations and Related Agencies appropriations bill
is the primary legislative vehicle through which Congress reviews the U.S.
international affairs budget and influences executive branch foreign policy making
in general. Funding for Foreign Operations and State Department/Broadcasting
programs has been steadily rising since FY2002, and amounts approved for FY2004
in regular and supplemental bills reached an unprecedented level compared with the
past 40 years. Emergency supplementals enacted since the September 11, 2001,
terrorist attacks to assist the front-line states in the war on terrorism, fund
Afghanistan and Iraq reconstruction, and upgrade State Department operations and
security upgrades, also have pushed spending upward.
This report analyzes the FY2008 budget request and funding trends, including
major issues Congress may consider, and tracks congressional action. Major issues
confronting the 110th Congress include:
!The overall size of the budget request that represents an 11%
increase over FY2007 enacted levels;
!A foreign aid reform plan that seeks to align assistance with U.S.
!Significant increases for Presidential initiatives;
!Continued costs relating to Iraq and Afghanistan; and
!Secretary Rice’s Transformational Diplomacy initiative for the State
Congress completed action on all appropriations bills in the FY2008
Consolidated Appropriations Act (H.R. 2764) during the week of December 17,
2007. The President signed the Act on December 26 (P.L. 110-161). The act also
included $2.4 billion in emergency supplemental funds for international affairs. The
Senate-passed State, Foreign Operations, and Related Programs appropriations bill
was the vehicle used for the consolidated bill. On February 6, 2007, the
Administration sent to Congress its FY2008 budget that included significant
increases for the international affairs budget. On June 5, 2007, the House
Appropriations Subcommittee on State, Foreign Operations, and Related Agencies
marked up the FY2008 measure providing a total of $34.243 billion; full committee
consideration followed on June 12. The House passed the bill, H.R. 2764, on June
22. The Senate Appropriations Committee approved its version of the bill on June
28, and the Senate passed it on September 6, approving the same level of total
funding as the House bill. The President sent an FY2008 supplemental request to
Congress on October 22 seeking, among other funds, an additional $3.6 billion for
This report will be updated to further reflect congressional action.
Key Policy Staff
Subj ect Na me Telepho ne E- M a il
General: Foreign Operations PolicyConnie Veillette7email@example.com
General: State Dept Policy Issues/BudgetSusan Epstein7firstname.lastname@example.org
Africa AssistanceTed Dagne7email@example.com
Agency for International DevelopmentConnie Veillette7firstname.lastname@example.org
Asia AssistanceThomas Lum7email@example.com
Broadcasting, InternationalSusan Epstein7firstname.lastname@example.org
Central Asia AssistanceJim Nichol7email@example.com
Debt ReliefMarty Weiss7firstname.lastname@example.org
Development Assistance (bilateral)Connie Veillette7email@example.com
Disaster/Humanitarian AidRhoda Margesson7firstname.lastname@example.org
Drug/Counternarcotics ProgramsLiana Wyler7email@example.com
Export-Import BankJames Jackson7firstname.lastname@example.org
Family Planning ProgramsLuisa Blanchfield7email@example.com
Foreign Service IssuesKen Nakamura7firstname.lastname@example.org
Health Programs, including HIV/AIDS, malariaTiaji Salaam7email@example.com
Human RightsKen Nakamura7firstname.lastname@example.org
International Affairs BudgetConnie Veillette7email@example.com
International Crime & NarcoticsLiana Wyler7firstname.lastname@example.org
International Organizations/UN FundingKen Nakamura7email@example.com
Iraq ReconstructionCurt Tarnoff7firstname.lastname@example.org
Latin America AssistanceConnie Veillette7email@example.com
Middle East AssistanceJeremy Sharp7firstname.lastname@example.org
Military AssistanceRichard Grimmett7email@example.com
Millennium Challenge AccountCurt Tarnoff7firstname.lastname@example.org
Multilateral Development Banks Jonathan Sanford7email@example.com
Overseas Private Investment Corporation James Jackson7firstname.lastname@example.org
Peace CorpsCurt Tarnoff7email@example.com
Nina Serafino firstname.lastname@example.org
Public DiplomacySusan Epstein7email@example.com
Refugee AidRhoda Margesson7firstname.lastname@example.org
Russia/East Europe AssistanceCurt Tarnoff7email@example.com
U.N. Population Fund (UNFPA)Luisa Blanchfield7firstname.lastname@example.org
U.S. Institute of PeaceSusan Epstein7email@example.com
U.N. Voluntary ContributionsMarjorie Browne7firstname.lastname@example.org
International Affairs FY2008 Budget Overview..........................1
Background and Trends.........................................2
FY2008 Budget Request: State Department and Related Agencies...........4
State Department — Administration of Foreign Affairs................6
Diplomatic and Consular Programs (D&CP)....................6
Embassy Security, Construction and Maintenance (ESCM).........7
Educational and Cultural Exchanges...........................7
The Capital Investment Fund (CIF)............................7
International Organizations and Conferences........................8
Contributions to International Organizations (CIO)...............8
Contributions to International Peacekeeping Activities (CIPA)......8
Related State Department Appropriations...........................9
The Asia Foundation.......................................9
The International Center for Middle Eastern-Western Dialogue
National Endowment for Democracy (NED).....................9
East-West and North-South Centers...........................9
U.S. Institute of Peace.........................................10
Broadcasting Board of Governors................................10
Emergency FY2007 and FY2008 Requests.........................11
FY2008 Emergency Supplemental Request.....................11
FY2007 Supplemental Request..............................11
FY2008 Budget Request: Foreign Operations...........................12
Transformational Development: The Request in the Context of Foreign
Foreign Operations Budget in Detail..............................14
Core Development versus Security Assistance..................17
HIV/AIDS and Tuberculosis Funding.........................21
MCC Compacts and Other Aid Accounts......................22
Use of Supplementals.....................................23
House Appropriations Action.......................................26
State Department and Related Agencies — Committee Action.........26
Administration of Foreign Affairs............................27
Related State Department Appropriations......................28
U.S. Institute of Peace (USIP)...............................28
Broadcasting Board of Governors............................28
State Department and Related Agencies — Floor Action..............29
Foreign Operations — House Committee Action....................29
Major Changes from Request...............................29
Foreign Operations — Floor Action..............................32
Senate Appropriations Action.......................................34
State Department and Related Agencies — Committee Action.........34
State Department and Related Agencies — Senate Floor Action........35
Foreign Operations — Senate Committee Action....................36
Foreign Operations — Senate Floor Action........................36
Appendix A. Acronyms............................................40
Appendix B. Foreign Aid Country Categories...........................41
Appendix C. State Department and Related Agencies Appropriations........43
Appendix D. Foreign Operations Appropriations........................46
List of Figures
Figure 1. Composition of Foreign Affairs Budget, FY2008.................2
Figure 2. Regional Distribution of Foreign Aid.........................17
Figure 3. Foreign Operations Supplemental Funding.....................24
List of Tables
Table 1. International Affairs Appropriations, FY1999-FY2008.............4
Table 2. State Department and Related Agencies Appropriations,
Table 3. Foreign Operations Appropriations, FY1999-FY2008.............13
Table 4. Framework for Foreign Assistance: Country Categories
Table 5. Core Development versus Security/Economic Assistance by
Table 6. Core Development versus Security/Economic Assistance by
Strategic Objective, FY2006-FY2008.............................19
Table 7. Selected Sector Funding, FY2006 and FY2008...................20
Table 8. Compact Countries, U.S. Assistance, FY2005-FY2008............22
Table 9. Funding for Iraq and Afghanistan, FY2002-FY2008..............25
State, Foreign Operations, and Related
Programs: FY2008 Appropriations
With the end of the first session of the 110th Congress at hand and only the
defense appropriation legislation enacted, Congress passed a consolidated spending
measure for all remaining appropriations bills. H.R. 2764, the State, Foreign
Operations, and Related Programs Appropriations bill, became the vehicle for a $555
billion omnibus spending bill that included funding for domestic agencies.
Congress completed action on the bill the week of December 17, 2007, and the
President signed it on December 26 (P.L. 110-161). The bill included some of the
emergency supplemental funding requested by the White House. The State
Department operations and foreign aid programs comprise and total $35 billion,
including $2.4 billion in emergency supplemental funds.
International Affairs FY2008 Budget Overview
The international affairs budget, also known as Function 150, funds a variety of
U.S. government programs and activities, including foreign economic and military
assistance, contributions to international organizations and multilateral financial
institutions, State Department and U.S. Agency for International Development
(USAID) operations, public diplomacy, and international broadcasting programs.
Figure 1 provides a percentage breakout of the FY2008 budget request, including
food aid that is appropriated in the Department of Agriculture appropriations bill.
Figure 1. Composition of Foreign Affairs Budget, FY2008
Note: The total figure of $36.48 billion includes $159 million for mandatory retirement accounts.
Source: Fiscal Year 2008 Budget of the U.S. Government and CRS calculations.
Background and Trends
The rationale for foreign affairs programs has transitioned from a largely anti-
communist orientation for some 40 years following World War II to a more recent
focus on anti-terrorism in the post September 11, 2001 environment. During the
Cold War, foreign aid and diplomatic programs also pursued a number of other U.S.
policy goals, such as reducing high rates of population growth, promoting economic
development in general, advancing U.S. trade interests, expanding access to basic
education and health care, and protecting the environment. In the 1990s, other goals
included stopping nuclear weapons proliferation, curbing the production and
trafficking of illegal drugs, expanding peace efforts in the Middle East, achieving
regional stability, protecting human rights and religious freedom, and countering
trafficking in persons.
A defining change in focus came following the September 11 terrorist attacks
in the United States. Since then, U.S. foreign aid and diplomatic programs have
taken on a more strategic sense of importance, and have been frequently cast in terms
of contributing to the war on terrorism. In 2002, President Bush released his
National Security Strategy that for the first time established global development as
the third pillar of U.S. national security, along with defense and diplomacy.
Development was again underscored in the Administration’s re-statement of the
National Security Strategy released on March 16, 2006.
Also in 2002, foreign assistance budget justifications began to highlight the war
on terrorism as the top foreign aid priority, emphasizing amounts of U.S. assistance
to 28 “front-line” states — countries that cooperate with the United States in the war
on terrorism or face terrorist threats themselves.1 Large reconstruction programs in
Afghanistan and Iraq, which peaked in FY2004, are also part of the emphasis on
using foreign aid to combat terrorism. State Department efforts focused extensively
on building coalitions to assist in the war on terrorism and finding new and more
effective ways of presenting American views and culture through public diplomacy.
In the context of the post 9/11 environment, the Bush Administration announced
significant initiatives relating to diplomacy and foreign aid. A new transformational
diplomacy initiative, announced in 2006, would reposition diplomats to global
trouble spots, create regional public diplomacy centers, localize small posts outside
of foreign capitals, and train diplomats in new skills. (See Transformational
Diplomacy section for more information.) Also announced in 2006 was the creation
of a new position at the State Department, the Director of Foreign Assistance (DFA),
who serves concurrently as USAID Administrator. Heading up the new “F bureau”
at State, the DFA has created a new Strategic Framework for Foreign Assistance with
the objectives of providing more coordination, coherence, transparency, and
accountability for aid programs. (See Transformational Development section for
Other presidential initiatives address development and global health concerns.
The Millennium Challenge Corporation is a new aid delivery concept, proposed by
President Bush in 2002, authorized by Congress (Title VI, Division D of P.L. 108-
199), and established in early 2004. It is intended to concentrate significantly higher
amounts of U.S. resources in a few low- and low-middle income countries that have
demonstrated a strong commitment to political, economic and social reforms. The
President initially pledged $5 billion annually by FY2006, although funds requested
and appropriated have never reached this level.
With regard to global health issues, President Bush announced in 2003 a five-
year, $15 billion commitment to combat HIV/AIDS. Known as the President’s
Emergency Plan for AIDS Relief, or PEPFAR, the initiative has focused significant
funds in 15 focus countries, largely in Africa.2 Subsequently, the President launched
a new initiative in mid-2005 aimed specifically at malaria (President’s Malaria
Initiative, or PMI), pledging $1.2 billion in additional resources through 2010. These
initiatives, which have benefitted African nations, have contributed to fulfilling the
Administration’s pledge to double aid to Africa in the 2004-2010 period. In May
2007, the President announced a second phase commitment of an additional $30
billion through FY2013.
1 According to the State Department, these “front-line” states included Afghanistan, Algeria,
Armenia, Azerbaijan, Bangladesh, Colombia, Djibouti, Egypt, Ethiopia, Georgia, Hungary,
India, Indonesia, Jordan, Kazakhstan, Kenya, Oman, Pakistan, Philippines, Poland, Russia,
Saudi Arabia, Tajikistan, Tunisia, Turkey, Turkmenistan, Uzbekistan, and Yemen.
2 PEPFAR countries include Botswana, Cote d’Ivoire, Ethiopia, Kenya, Mozambique,
Namibia, Nigeria, Rwanda, South Africa, Tanzania, Uganda, Zambia, Vietnam, Guyana, and
Beyond these recently emerging foreign policy goals relating to terrorism and
global health concerns, other prominent objectives have continued since the early
Egypt, Jordan, and the Palestinians; fostering democratization and stability for
countries in crisis, like Bosnia, Haiti, Rwanda, Kosovo, Liberia, and Sudan;
facilitating democratization and free market economies in Central Europe and the
former Soviet Union; suppressing international narcotics production and trafficking
through assistance to Colombia and the Andean region; and alleviating famine and
mitigating refugee situations in places throughout the world.
The international affairs budget can be divided into two components — State
Department/Diplomacy/Broadcasting and Foreign Operations. Both components are
analyzed separately in the rest of this report. Taken together, the international affairs
budget has fluctuated in real terms in response to changing global events. Table 1
shows appropriations for the last decade in both current and constant dollars.
Table 1. International Affairs Appropriations, FY1999-FY2008
(discretionary budget authority in billions of current and constant 2008 dollars)
FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08
Note: Amounts do not include mandatory Foreign Service retirement accounts that total $159 million
in FY2008. The FY2008 column reflects amounts requested by the Administration. FY1999 excludes
$17.61 billion for the International Monetary Fund. All figures include regular and supplemental
appropriations. Figures for FY2008 are requested amounts.
FY2008 Budget Request: State Department and
The Administration’s FY2008 budget request for the Department of State is
$10.014 billion, representing a 10.5% increase over the FY2007 estimate, but a
decline of 4.3% as compared with the FY2006 actual appropriation (the most recent
enacted appropriation for the Department of State), including rescissions and
supplementals. For international broadcasting, the FY2008 request of $668.2 million
represents a 3.8% increase over the FY2007 estimate, but a 1.7% decline from the
FY2006 level, including rescissions and supplementals. Related agencies, which are
also funded in the State and Foreign Operations Appropriations bill, include the
Broadcasting Board of Governors (BBG), and U.S. assessed contributions to United
Nations (U.N.), International Organizations, and U.N. Peacekeeping. Also included
are funding for the Asia Foundation, the National Endowment for Democracy, and
several other small educational and exchange organizations, as well as resources for
3 State Department and Related Agencies section written by Susan B. Epstein, Specialist in
Foreign Affairs and Trade.
international commissions, and the U.S. Institute of Peace. Table 2 shows
appropriations for the last decade in both current and constant dollars.
Table 2. State Department and Related Agencies
(discretionary budget authority in billions of current and constant dollars)
FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08
Note: Amounts do not include mandatory Foreign Service retirement accounts that total $123 million
in FY2008. All figures include regular and supplemental appropriations. Figures for FY2008 are
On January 18, 2006, Secretary of State Condoleezza Rice announced her vision
for U.S. diplomacy in the 21st Century. She said that to match President Bush’s bold
mission of “supporting democracy around the world with the ultimate goal of ending
tyranny in our world,” the United States needs “an equally bold diplomacy that not
only reports about the world as it is, but seeks to change the world itself.”4 The
Secretary referred to this as “transformational diplomacy.” (For more detail on
transformational diplomacy, see CRS Report RL34141, Diplomacy for the 21st
Century: Transformational Diplomacy, by Kennon H. Nakamura and Susan B.
Epstein.) Specific aspects of Secretary Rice’s Transformational Diplomacy include:
!Global repositioning. Beginning in FY2006 and continuing through
FY2007, the Department of State has decided on more than 200
positions to be moved largely from Europe and Washington, DC, to
strategically critical areas in Africa, South Asia, East Asia, the
Middle East and elsewhere in FY2007. Additional jobs are to be
targeted by the summer.
!Regional focus. The Department is creating regional public
diplomacy centers in Europe and the Middle East, as well as regional
centers for information technology to perform management support
activities such as human resources or financial management.
!Localization. As part of the U.S. public diplomacy mission,
American Presence Posts (APP) are to be operated by one diplomat
working away from the embassy in key population centers of a
country; Virtual Presence Posts (VPP) are to provide an Internet site
enabling millions of local citizens, particularly young people, to
4 Transformational Diplomacy: Remarks at Georgetown School of Foreign Service,
Department of State, January 18, 2006. [http://www.state.gov/secretary/rm/2006/59306.htm]
interact with embassy personnel. IT Centralization would provide
the State Department workforce with real-time and cutting-edge
information whether at their desks or traveling. Creative use of the
Internet would enhance America’s presence through the Internet
interactive online discussions such as Café USA/Seoul.
!Plans for new skills challenges including enhanced training for
technology and languages; multi-region expertise requiring
diplomats to be experts in at least two regions and fluent in two
languages; post assignments criteria requiring diplomats to serve in
at least one of the more challenging posts; hands-on practice for
diplomats to be more involved in helping foreign citizens, promoting
democracy, running programs, starting businesses, improving
healthcare, and reforming education — overall recognizing public
diplomacy as an important part of every diplomat’s job.
!Empowering diplomats to work with other federal agencies —
especially with the U.S. military deployed abroad.
Within the Department of State’s FY2008 budget, the Administration is
requesting $124.8 million for Transformational Diplomacy. Included is $39.9
million for repositioning of jobs, $20.8 million for language, public diplomacy, and
technology training, $34.5 million for Foreign Service modernization, and $15
million for public diplomacy. The FY2007 budget request included $102.8 million
for Transformational Diplomacy.
State Department — Administration of Foreign Affairs
The State Department’s mission is to advance and protect the worldwide
interests of the United States and its citizens through the staffing of overseas
missions, the conduct of U.S. foreign policy, the issuance of passports and visas, and
other responsibilities. Currently, the State Department coordinates with the activities
of 50 U.S. government agencies and organizations in operating more than 260 posts
in over 180 countries around the world. Currently, the State Department employs
approximately 30,000 people, about 60% of whom work abroad. Highlights follow.
Diplomatic and Consular Programs (D&CP). The D&CP account funds
overseas operations (e.g., motor vehicles, local guards, telecommunications,
medical), activities associated with conducting foreign policy, passport and visa
applications, regional bureaus, under secretaries, and post assignment travel.
Beginning in FY2000, the State Department’s Diplomatic and Consular Program
account included State’s salaries and expenses, as well as the technology and
information functions of the former U.S. Information Agency (USIA) and the
functions of the former Arms Control and Disarmament Agency (ACDA).
For D&CP’s FY2008 budget, the Administration is requesting $4,942.7 million,
14.5% above the estimated FY2007 level, but a 13.2% decline from the FY2006
funding level of $5,692.3 million, reflecting rescissions and supplementals. Within
the FY2008 request, $964.8 million is designated for worldwide security upgrades.
The estimated FY2007 funding level is $4,314.0 million, of which more than $700
million is for supporting worldwide security upgrades.
Embassy Security, Construction and Maintenance (ESCM). This
account supports the maintenance, rehabilitation, and replacement of facilities to
provide appropriate, safe, secure and functional facilities for U.S. diplomatic
missions abroad. Early in 1998, Congress had enacted $640 million for this account
for FY1999. However, following the embassy bombings in Africa in August 1998,
Congress agreed to more than $1 billion (a supplemental funding bill) for the
Security and Maintenance account by establishing a new subaccount referred to as
Worldwide Security Upgrades.
The Administration seeks $792.5 million for FY2008 for regular ESCM and
$806.9 million for worldwide security upgrades, for a total account level of $1,599.4
million, a 7.4% increase over both the FY2007 and FY2006 ESCM total
appropriations level of $1,489.7 million, reflecting rescissions.
Educational and Cultural Exchanges. This account funds programs
authorized by the Mutual Educational and Cultural Exchange Act of 1961, such as
the Fulbright Academic Exchange Program, as well as leadership programs for
foreign leaders and professionals. Government exchange programs came under close
scrutiny in past years for being excessive in number and duplicative. After the
September 11th attacks, the Department of State began to emphasize public
diplomacy activities in Arab and Muslim populations.
The Bush Administration is requesting $486.4 million for exchanges in FY2008.
This represents a 9.1% increase over the FY2007 estimate and a 12.8% increase over
the FY2006 enacted level of $431.3 million. In addition, Congress, in the FY2006
appropriation, designated $329.7 million in the D&CP funds for public diplomacy.
The estimated FY2007 funding level for public diplomacy within D&CP is unclear
at this time.
The Capital Investment Fund (CIF). CIF was established by the Foreign
Relations Authorization Act of FY1994/95 (P.L. 103-236) to provide for purchasing
information technology and capital equipment that would ensure the efficient
management, coordination, operation, and utilization of State’s resources.
The FY2008 budget request includes $70.7 million for CIF, which is 21.7%
higher than both the enacted FY2006 and estimated FY2007 levels of $58.1 million.
The request seeks no funding for the Centralized Information Technology
Modernization Program, which was funded in FY2006 at $68.5 million. In addition,
the FY2006 conference report (H.Rept. 109-272) stated that the conferees expect
$116 million from expedited passport fee collections would be used for Technology
Investments in FY2006. The Revised Continuing Appropriations Resolution,
FY2007 (P.L. 109-289, as amended by P.L. 110-5) explicitly stated no funding would
be provided for the Centralized Information Technology Modernization Program in
International Organizations and Conferences
In recent years, U.S. contributions to the United Nations and its affiliated
agencies (CIO) and peacekeeping activities (CIPA) have been affected by a number
of issues. These have included the withholding of funds related to international
family planning policies; issues related to implementation of the Iraq Oil for Food
Program and the findings and recommendations of the Volcker Committee Inquiry
into that program; alleged and actual findings of sexual exploitation and abuse by
personnel in U.N. peacekeeping operations in the field and other misconduct by U.N.
officials at U.N. headquarters in New York and at other U.N. headquarters venues;
and efforts to develop, agree to, and bring about meaningful and comprehensive
reform of the United Nations organization, in most of its aspects.
Since 2004, congressional attention has often been directed to ways to ensure
comprehensive U.N. reform, through legislative proposals fashioned after extensive
hearings. Current legislative issues include followup and oversight of reforms
initiated by the United Nations membership in September 2005 and throughout its
fall General Assembly session and the possibility of increasing the 25% legislative
cap on U.S. contributions to U.N. peacekeeping assessments to 27.1%.5
Contributions to International Organizations (CIO). CIO provides
funds for U.S. membership in numerous international organizations and for
multilateral foreign policy activities that transcend bilateral issues, such as human
rights. Maintaining a membership in international organizations, the Administration
argues, benefits the United States by advancing U.S. interests and principles while
sharing the costs with other countries. Payments to the U.N. and its affiliated
agencies, the Inter-American Organizations, as well as other regional and
international organizations, are included in this account.
The President’s FY2008 request totaling $1,354.4 million for this account
represents a 17.6% increase over the estimated FY2007 level and the FY2006
enacted appropriation of $1,151.3 million, including rescissions.
Contributions to International Peacekeeping Activities (CIPA). The
United States supports multilateral peacekeeping efforts around the world through
payment of its share of the U.N. assessed peacekeeping budget. The President’s
FY2008 request totals $1,107.0 million. This represents nearly a 4% decline from
the FY2006 actual funding level of $1,152.1 million and a smaller decline of 2.5%
below the estimated FY2007 CIPA funding level of $1,135.3 million.
The International Commissions account (in the State Department budget, but not
in the 150 account) includes the U.S.-Mexico Boundary and Water Commission, the
International Fisheries Commissions, the International Boundary Commission, the
International Joint Commission, and the Border Environment Cooperation
5 For more information, see CRS Report RL33611, United Nations System Funding:
Congressional Issues, by Marjorie Ann Browne.
Commission. The FY2008 request of $113.5 million represents a 100.8% increase
over the FY2006 level of $66.5 million and a 99% increase over the estimated
FY2007 level of $67 million. The increase is largely due to plans for a water
treatment project near San Diego, California.
Related State Department Appropriations
The Asia Foundation. The Asia Foundation is a private, nonprofit
organization that supports efforts to strengthen democratic processes and institutions
in Asia, open markets, and improve U.S.-Asian cooperation. The Foundation
receives both government and private sector contributions. Government funds for
the Asia Foundation are appropriated to, and pass through, the State Department.
The Administration request for FY2008 is $10 million, the same as requested a year
earlier, but 27.5% below the enacted FY2006 level of $13.8 million (with
rescissions). The estimated government funding level for FY2007 is $13.8 million
for the Asia Foundation.
The International Center for Middle Eastern-Western Dialogue
Trust Fund. The conferees added language in the FY2004 conference agreement
for the Consolidated Appropriations Act, FY2004, to establish a permanent trust fund
for the International Center for Middle Eastern-Western Dialogue. The act (P.L. 108-
199) provided $6.9 million for perpetual operations of the Center, which is to be
located in Istanbul, Turkey. From FY2004 to FY2006, appropriations provided
$18.75 million as seed money. The Center’s funds each year are the total amount of
interest and earnings from the Trust. The Administration requested spending
$850,000 of interest and earnings from the Trust Fund for program funding in
FY2006. For FY2007, the Administration requested appropriation authority to spend
$750,000 of interest and earnings from the Trust Fund to be used for programming
activities and conferences at the Center. The FY2008 budget contains a request for
$875,000 from the Trust for the program account.
National Endowment for Democracy (NED). The National Endowment
for Democracy, a private nonprofit organization established during the Reagan
Administration, supports programs to strengthen democratic institutions in more than
90 countries around the world. NED proponents assert that many of its
accomplishments are possible because it is not a government agency. NED’s critics
claim that it duplicates U.S. government democracy programs and either could be
eliminated or could operate entirely with private funding.
The Administration’s FY2008 budget request of $80 million for NED is the
same as its FY2005, FY2006, and FY2007 requests. The FY2008 request represents
an 8.1% increase over the enacted $74.0 million (after rescissions) for FY2006. Inth
addition, however, the 109 Congress created a Democracy Fund in the FY2006
Foreign Operations Appropriations (P.L. 109-102) which provided an additional
$15.25 million for NED that year. The estimated FY2007 funding level is estimated
to be $74 million.
East-West and North-South Centers. The Center for Cultural and
Technical Interchange between East and West (East-West Center), located in
Honolulu, Hawaii, was established in 1960 by Congress to promote understanding
and cooperation among the governments and peoples of the Asia/Pacific region and
the United States. The Center for Cultural and Technical Interchange between North
and South (North-South Center) is a national educational institution in Miami,
Florida, closely affiliated with the University of Miami. It is to promote better
relations, commerce, and understanding among the nations of North America, South
America and the Caribbean. The North-South Center began receiving a direct
subsidy from the federal government in 1991. Congress has not funded the North-
South Center since FY2001, noting that it should be funded by the private sector.
The Administration’s FY2008 request is for $10 million for the East-West
Center, a decrease of 47.4% from the FY2006 funding level of $19.0 million
(including rescissions). The FY2007 funding level is currently set at $19 million.
U.S. Institute of Peace
The U.S. Institute of Peace (USIP) was established in 1984 by the U.S. Institute
of Peace Act, (Title XVII of the Defense Authorization Act of 1985 P.L. 98-525).
USIP’s mission is to promote international peace through activities such as
educational programs, conferences and workshops, professional training, applied
research, and dialogue facilitation in the United States and abroad. Prior to the
FY2005 budget, USIP funding came from the Labor, HHS, Education and Related
Agencies appropriation. In the FY2005 budget process, it was transferred to the
Commerce, Justice, State and related agencies appropriation primarily for relevancy
For FY2008, the Administration is requesting $30 million, up nearly $8 million
from the FY2007 estimated level of $22.07 million, after rescissions.
Broadcasting Board of Governors
The United States International Broadcasting Act of 19946 reorganized within
USIA all U.S. government international broadcasting, including Voice of America
(VOA) radio and television, Broadcasting to Cuba, Radio Free Europe/Radio Liberty
(RFE/RL), Radio Free Asia (RFA), and the Middle East Broadcasting Network. The
government broadcasting; abolished the Board for International Broadcasting (BIB),
the administering body of RFE/RL; and recommended that RFE/RL be privatized by
December 31, 1999. This recommendation was repealed in 1999 by P.L. 106-113.
During the reorganization debate in 1999, the 106th Congress agreed that
credibility of U.S. international broadcasting was crucial to its effectiveness as a
public diplomacy tool. Therefore, Congress agreed not to merge broadcasting
functions into the State Department, but to maintain the Broadcasting Board of
Governors (BBG) as an independent agency as of October 1, 1999.
6 Title III of the Foreign Relations Authorization Act, Fiscal Years 1994 and 1995; P.L. 103-
For FY2008 international broadcasting activities the President is requesting
$668.2 million, an increase of 3.8% over the FY2007 estimate of $644 million, but
a decrease of 1.7% from the FY2006 enacted level of $679.6 million, including
rescissions and supplementals. Of the $668.2 million request, $618.8 million would
be for broadcasting operations, such as VOA, $10.7 million for Capital
Improvements, and $38.7 million for Broadcasting to Cuba.
The BBG is planning to eliminate several VOA services including Uzbek,
Greek, and Cantonese as well as the RFE/RL Macedonia service. BBG also plans
to reduce several others, such as VOA and RFE/RL service in Ukrainian, Tibetan,
and Romanian. (Reportedly, eleven former VOA directors are appealing to Congress
to reverse the proposed Administration cuts.)7 At the same time, BBG’s FY2008
request would increase Middle East Broadcasting network funds by some $20
Emergency FY2007 and FY2008 Requests
Along with the FY2008 budget request, the White House sent to Congress two
supplemental funding requests — one for FY2007 amounting to $1.168 billion for
State and $10 million for international broadcasting; another for FY2008 amounting
to $1.935 billion for the Department of State. Both requests are primarily for U.S.
operations in Iraq and Afghanistan.
Currently, the U.S. Embassy in Iraq has over 1,000 American and locally
engaged staff representing about 12 agencies. 156 U.S. direct hires and 155 locally
engaged staff represent the Department of State (DOS) in the U.S. Mission. The bulk
of the FY2007 supplemental and FY2008 emergency requests would fund State
Department operations in Iraq.8
FY2008 Emergency Supplemental Request. The Bush Administration
revised its original FY2008 emergency supplemental request and sent it to Congress
October 22, 2007. The Administration increased its original request of $1.882 billion
to $2.283 billion for ongoing U.S. Mission operations in Iraq (an increase of $401.4
million); added $160.0 million in the request for Embassy security in Kabul,
Afghanistan; and added $723.6 million for Contributions for International
Peacekeeping Activities (CIPA) to facilitate delivery of humanitarian assistance in
Darfur, Sudan. In addition, the previously requested amount of $35 million for
Migration and Refugee Assistance (to help Palestinian refugees in Lebanon, West
Bank, and Gaza) was increased to $230.0 million. The increase of $195 million is
entirely for social services to Iraqi refugees.
FY2007 Supplemental Request. On April 25 and 26, the House and Senate
passed the conference report (H.Rept. 110-107) for the FY2007 Supplemental (H.R.
8 For information on the FY2007 supplemental, see CRS Report RL33900, FY2007
Supplemental Appropriations for Defense, Foreign Affairs, and Other Purposes, by Stephen
Daggett, Amy Belasco, Pat Towell, Susan B. Epstein, Connie Veillette, Curt Tarnoff,
Rhoda Margesson, and Bart Elias.
1591, U.S. Troop Readiness, Veterans’ Care, Katrina Recovery, and Iraq
Accountability Appropriations Act, 2007) that provided $1.275 billion for State
Department operations. The bulk of the funds ($871 million) would support U.S.
operations, security, and mission in Iraq, and other world wide security upgrades.
Also included was $20 million for educational and cultural exchanges, $10 million
for international broadcasting, and $338 million for contributions to international
organizations and peacekeeping activities.
After the President vetoed the bill, Congress passed H.R. 2206, which the
President signed on May 25. It provided $1.27 billion including $871 million for
State Department operations in Iraq, and $333 million for contributions to
international organizations and peacekeeping activities. It also included $20 million
for educational and cultural exchanges, and $10 million for international
Last year the Bush Administration requested an FY2006 Emergency
Supplemental of $1.497 billion within State’s Diplomatic and Consular Programs
budget account to cover Iraq operations and security. The House and Senate passed
the emergency supplemental conference report (H.R. 4939. H.Rept. 109-494) in June
2006. The final measure included $1.529 billion for D&CP in Iraq, $25.3 million for
State’s Inspector General, $5 million for exchanges in Iran, $178 million for U.N.
peacekeeping, and $36.1 million for international broadcasting in Iran. The President
signed the measure into law (P.L. 109-234) on June 15, 2006.
FY2008 Budget Request: Foreign Operations9
The Foreign Operations budget comprises the majority of U.S. foreign
assistance programs, both bilateral and multilateral. (See tables at the back of this
report for Foreign Operations accounts and funding levels.) The annual Foreign
Operations Appropriations bill funds all U.S. bilateral development assistance
programs, managed mostly by USAID and the State Department, together with
several smaller independent foreign aid agencies such as the Millennium Challenge
Corporation, the Peace Corps, and the Inter-American and African Development
Foundations. It also includes funds for the Export-Import Bank, whose activities are
regarded more as trade promotion rather than foreign aid. Food aid, such as the P.L.
although it is also considered foreign aid. The FY2008 request for food aid programs
totals $1.319 billion.
The foreign operations budget request for FY2008 totals $24.4 billion10 in
foreign assistance programs, representing a 12% increase from the previous year’s
enacted level of $21.7 billion. This level of increase is the largest within the budget
9 Foreign Operations section written by Connie Veillette, Specialist in Foreign Affairs.
10 This does not include the mandatory Foreign Service Retirement and Disability Account,
that totals $36 million for FY2008. The account is included in tables at the end of this
request government-wide, and continues the general trend of increases since
September 11, 2001. Table 3 provides funding levels for foreign operations since
FY1999 in both current and constant dollars.
Table 3. Foreign Operations Appropriations, FY1999-FY2008
(discretionary budget authority in billions of current and constant dollars)
FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08
Note: Amounts do not include mandatory Foreign Service retirement accounts that total $36 million
in FY2008. FY1999 excludes $17.61 billion for the IMF. All figures include regular and
supplemental appropriations. Figures for FY2008 are requested amounts.
Transformational Development: The Request in the Context
of Foreign Aid Reform
A new dimension to this year’s budget request is the Administration’s
transformational development agenda and the creation of the new State Department11
position of Director of Foreign Assistance (DFA). The DFA, who is also
concurrently the USAID Administrator, has been given authority over foreign
assistance programs managed by the State Department and USAID. In addition, the
DFA is to “provide guidance” for foreign assistance delivered through other
government agencies. Randall Tobias, previously the State Department’s Global
AIDS Coordinator, served as the DFA and USAID Administrator until April 27,
The DFA is charged with two missions: to develop a coordinated foreign
assistance strategy; and to direct a transformation of foreign assistance to achieve the12
President’s Transformational Development Goals. To that end, he presented a new
Strategic Framework for Foreign Assistance13 that links aid programs to U.S.
strategic objectives. Countries are grouped in categories representing common
development challenges. (See appendix B for a list of countries and their categories.)
The FY2008 budget is the first opportunity to evaluate the effects of the reform plan
on funding levels for accounts, sectors and specific countries.
The Strategic Framework creates five categories of countries. The first —
Rebuilding — includes countries in, or emerging from, internal or external conflicts.
Transforming countries include low and lower-middle income countries that meet
11 For more information on the DFA and restructuring of foreign assistance, see CRS Report
RL33491, Restructuring U.S. Foreign Assistance: The Role of the Director of Foreign
Assistance (DFA) in Transformational Development, by Connie Veillette.
12 U.S. Department of State Fact Sheet: New Direction for U.S. Foreign Assistance, January
13 The Framework is available at [http://state.gov/f/reform/].
certain performance criteria based on good governance and sound economic policies.
The category of Developing countries includes low and lower-middle income
countries that are not yet meeting performance criteria. Sustaining Partnership
countries include upper-middle income countries with which the United States
maintains economic, trade, and security relationships beyond foreign aid. Restrictive
countries include authoritarian regimes with significant freedom and human rights
issues, most of which are ineligible for U.S. aid. Programs in these countries operate
through non-governmental organizations or through entities outside the country. A
sixth category was created to encompass global or regional programs that transcend
any one country’s borders.
Each category represents common development challenges around which aid
programs are to be designed and coordinated. Strategic objectives have been created
and linked to country categories. Strategic objectives include peace and security;
governing justly and democratically; investing in people; economic growth; and
humanitarian assistance. Table 4 illustrates the linkages between country category
and aid objective. Countries in each category are expected to receive most of their
assistance based on a primary objective, but they may in fact receive assistance under
several or all objectives.
Table 4. Framework for Foreign Assistance: Country Categories
ObjectiveCategory FocusProgram FocusAccounts
Peace & SecurityRebuildingTerrorism,FMF, TI, IMET,
Sustaining PartnersStabilization, DefenseESF, INCLE, NADR,
Reform, Drugs, Crime,PKO, ACI, FSA,
GoverningRebuildingRule of Law, HumanDA, TI, SEED, FSA,
Justly/Democ.RestrictiveRights, Governance,DF, ESF, INCLE,
Investing inDevelopingHealth, Education,DA, CSH, ESF,
PeopleTransformingVulnerable PopulationsIDFA, GHAI, PL 480
EconomicTransformingTrade, Agriculture,DA, ESF, SEED,
GrowthRebuildingInfrastructure,FSA, ACI, PL 480
HumanitarianRebuildingMigration, Refugees,IDFA, MRA, ERMA,
Note: See Appendix A for a list of account acronyms.
Foreign Operations Budget in Detail
Despite a proposed 12% increase in the foreign aid budget, most of the
additional funds are concentrated in a few areas. The FY2008 budget continues a
focus on the war on terrorism and reconstruction in Afghanistan and Iraq, as well as
assistance to front-line states. Other areas that would see large increases include
three of the President’s cornerstone initiatives — the Millennium Challenge
Corporation, the President’s Emergency Plan for AIDS Relief (PEPFAR), and the
President’s Malaria Initiative. Africa continues to see higher levels of assistance than
other regions, but most of the funds are concentrated in HIV/AIDS programs, with
other types of assistance, such as basic education and agriculture, decreasing.
Major Changes. One major change in the FY2008 budget was the decision
to transfer some Development Assistance (DA) funds to Economic Support Fund
(ESF). This was a strategic decision that resulted from the new Framework — some
programs previously funded with DA were considered to fit better with the strategic
objectives that are to be primarily funded with ESF. Consequently, ESF increases
by 35% from FY2007, while DA decreases by 31%. A similar change occurs in the
Andean Counterdrug Initiative (ACI) with funds for alternative development
transferred to ESF.
Those programs scheduled for significant increases include the Millennium
Challenge Corporation (up 71%); International Narcotics Control and Law
Enforcement (up 35%); Non-proliferation, Anti-terrorism, Demining and Related
Programs (up 14%); Global HIV/AIDS Initiative (up 28%); and debt restructuring
Programs that would see significant decreases include Child Survival and Health
(down 9%); International Disaster and Famine Assistance (down 18%); Assistance
to the Independent States of the Former Soviet Union (down 22%); Migration and
Refugee Assistance (down 7%); and International Organizations and Programs (down
11%). The U.S. contribution to the Global Fund for HIV/AIDS, TB, and Malaria is
scheduled for a 58% reduction, from $724 million to $300 million. Unlike in
previous years when the contribution was taken from Child Survival and Health
(CSH), the Global HIV/AIDS Initiative (GHAI), and the Department of Health and
Human Services (HHS), the Administration proposes that the entire $300 million
would come from HHS. The CSH contribution was $247.5 million in FY2007; if
this transfer is taken into account, the CSH request would represent a 5% increase
over last year’s level.
Regional Distribution. With the exception of Africa, few regions see large
increases when excluding funds from Millennium Challenge Compacts. (Such
compacts are large grants that go to a few countries in each region.15) Africa would
benefit from a 37% increase from FY2007, largely in HIV/AIDS funds, with other
programs cut. Those cuts occur in the sectors of basic education, agricultural sector
productivity, water supply and sanitation, and family planning and reproductive
14 The large percentage increase for debt relief is due to funds requested to cover the cost
of completing Highly Indebted Poor Countries (HIPC) bilateral debt relief for the
Democratic Republic of the Congo.
15 For more information, see CRS Report RL32427, Millennium Challenge Account, by Curt
health.16 South and Central Asia would see a slight increase of nearly 7%, largely
due to assistance to Afghanistan and Pakistan. The Near East would receive a 5%
increase, mainly due to Iraq assistance.
Other regions would receive either static funding or see decreases in aid. A 12%
decrease for Europe and Eurasia is a result of some countries in Europe graduating
from aid programs. Latin America’s decrease of 4% mainly affects basic education,
environment, and humanitarian assistance. Funding to the East Asia and the Pacific
region would increase by 2%.
Effects of HIV/AIDS Funding on Regional Distribution. One of the
major focuses of the FY2008 budget is a continuation of funding to address the
HIV/AIDS pandemic in many countries with high prevalence rates. The 15 PEPFAR
focus countries are the main beneficiaries, although CSH funds are used in non-focus17
countries as well. When PEPFAR money from the Global HIV/AIDS Initiative
(GHAI) account are included in totals, most regions receive slight increases (with the
exception of Africa, which receives a very large increase), or slight decreases from
FY2006 levels. (See Figure 2.)
A concern of some aid analysts is the effect that this focus has on other types of
development assistance. The largest effect can be seen in Africa. If GHAI funds are
excluded, then Africa would see a 2% decrease in aid rather than a 37% increase in
aid for FY2008.18 Two Latin American and Caribbean countries benefit from
PEPFAR — Haiti and Guyana — raising the region’s foreign aid totals. If these
funds are excluded, aid to Latin America and the Caribbean would decrease by 5%
from FY2007. Similarly, if Vietnam’s AIDS funding were subtracted, aid levels to
East Asia and the Pacific would fall by nearly 5%.
16 Sector allocations for 2007 are not yet available. Comparisons here are to FY2006.
When 2007 figures are available, this analysis will be updated. This analysis does not
include some global programs that may be allocated to certain regions. It also does not
include food assistance.
17 For more information, see CRS Report RL33485, U.S. International HIV/AIDS,
Tuberculosis, and Malaria Spending: FY2004-FY2008, by Tiaji Salaam-Blyther.
18 It should be noted that some P.L. 480 food aid is unallocated until need is established.
Should Africa receive a large portion, as it has in the past, then Africa’s overall aid level
will be higher.
Figure 2. Regional Distribution of Foreign Aid
AFR EAP EUR NE SCA W H
Source: U.S. Department of State.
Note: Includes GHAI funds. Figures are in billions of current U.S. dollars. AFR = Africa; EAP =
East Asia and Pacific; EUR = Europe and Eurasia; NE = Near East; SCA = South and Central Asia;
WH = Western Hemisphere.
Core Development versus Security Assistance. A long-running debate
in the foreign assistance community is whether the ratio of “core” development
assistance to security and economic assistance is appropriate. Proponents of core
development define it as those programs having a primary focus on poverty
alleviation and health concerns. The accounts that fund these types of programs are
Development Assistance (DA), Child Survival and Health (CSH), and the Global
HIV/AIDS Initiative (GHAI). Some observers also include the Millennium
Challenge Account, and some of the contingency accounts that respond to
emergencies, such as Migration and Refugee Assistance, Emergency Refugee and
Migration Assistance, Transition Initiatives, and International Disaster and Famine
For the most part, non-governmental organizations tend to exclude Economic
Support Funds (ESF) from their definition of core development assistance for two
reasons. First, there is the perception that ESF is given to strategic allies regardless
of need, largely due to historic levels of ESF that have gone to such countries as
Egypt and Israel. Second, a sizeable portion of ESF funds has been used for budget
support rather than development projects. On the ground, the characterization that
ESF does not promote development is difficult to make because some ESF-funded
programs have the same or similar purposes as those funded by DA.
The FY2008 budget request proposes a major change by transferring some
programs funded by DA into the ESF account. This change complicates the analysis
because ESF no longer cleanly fits in the non-core development assistance category,
if it ever really did. Table 5 compares the FY2008 request with FY2007 estimates
based on accounts with ESF disaggregated by budget support and development.
When including the three major development accounts (Development
Assistance, Child Survival and Health, and the Global HIV/AIDS Initiative),
development assistance is proposed to increase in FY2008 by 4.5% from FY2007.
The largest portion of this increase is in the HIV/AIDS initiative, with both DA and
CSH falling from last year’s levels. If one also includes other accounts (Millennium
Challenge, Transition Initiatives, disaster and famine aid, food aid, and migration and
refugee assistance), the increase from last year is 13%. However, virtually all of this
increase can be attributed to the 71% increase in funds for the Millennium Challenge
Corporation. All other accounts receive the same or decreased funding.
Dividing the ESF account into budget support versus program funding helps
clarify the debate of how to characterize ESF. Of the amount requested for
Economic Support Fund, approximately $478 million would go for budget support
with the remainder presumably funding development projects. Using this scenario,
the ratio of core to non-core for FY2008 is 86% to 14%.
Table 5. Core Development versus Security/Economic
Assistance by Account, FY2006-FY2008
(millions current U.S. dollars)
Core DevelopmentFY2006FY2007FY2008% Change
Accounts Ac t u al Estimate Request F Y 07-F Y 08
Child Survival & Health1,652.21,718.21,564.3-9.0%
Global AIDS Initiative1,975.13,246.54,150.027.8%
Subtotal — Core5,152.66,463.56,755.54.5%
Economic Support Fund — Corea1,763.71,738.02,841.663.5%
Subtotal — Core with ESF6,916.38,201.59,597.117.0%
M i gr a t i o n / R e f u ge e 888.5 887.9 828.5 -6.7%
Total — All Core11,763.712,556.715,079.120.1%
SEED/FSA 866.3 725.9 640.9 -11.7%
Core DevelopmentFY2006FY2007FY2008% Change
Accounts Ac t u al Estimate Request F Y 07-F Y 08
ESF - Budget Support844.0717.0478.0-33.3%
Subtotal — Non-Core8,315.87,902.87,507.0-5.0%
a. ESF core and non-core do not include supplemental funding. The core figure is obtained
by subtracting funds for budget support from the total.
The Administration prefers that the focus be on strategic objectives rather than
accounts. Table 6 provides a breakout of funding for each objective. It is plausible
to conceptualize Investing in People, Economic Growth, and Humanitarian
Assistance as correlating to core programs, although some would argue that since
Economic Growth receives ESF funding, it should not be included. The proposal to
transfer some Development Assistance funds to ESF makes casting Economic
Growth as a core program unavoidable.
Table 6. Core Development versus Security/Economic
Assistance by Strategic Objective, FY2006-FY2008
(millions of current U.S. dollars)
Strategic ObjectiveFY2006FY2008% Change
Investing in People4,957.46,954.340.3%
Subt ot al 9,597.7 11,448.9 19.3%
Peace & Security6,817.16,879.10.9%
Governing Justly & Democratically1,233.21,448.017.4%
Subt ot al 8,050.3 8,327.1 3.4%
Source: U.S. Department of State, Congressional Budget Justification Foreign Operations, and CRS
Note: The Administration does not use the terms core versus non-core that are commonly used by the
development community. [The objectives listed here in each category fund programs from accounts
that are identified (as in Table 5) as corresponding to poverty and health-focused programs versus
security.] This table does not include funding for the Millennium Challenge Corporation that would
total $3 billion in FY2008.
a. Part of the decrease in Economic Growth can be attributed to the glidepath agreement to phase out
assistance to Israel. The FY2008 budget proposes a shift of funds from ESF to FMF for Israel.
Sector Distribution. Over the years, Congress has expressed interest in
various aid sectors, such as education, democracy, human rights, trade, maternal and
child health, family planning and reproductive health, agriculture and environment.
Table 7 provides the funding levels for many of these sectors for FY2006 and the
FY2008 request. Some sectors are cut significantly, as listed below, while others
receive sizeable increases. Increases in health-related programs, up nearly 50%,
occur largely in HIV/AIDS, malaria, and avian flu programs. Two sub-sectors —
maternal and child health, and family planning and reproductive health — see hefty
decreases. Funds in the Peace and Security objective are targeted for increases,
particularly for counter-terrorism and rule of law programs.
Table 7. Selected Sector Funding, FY2006 and FY2008
(millions of current U.S. dollars)
Sector F Y 2006 Request Change
Maternal and Child Health738.85608.53-17.6%
Family Planning/Reproductive Health429.82332.29-22.7%
Trade and Investment408.74238.58-41.6%
Agriculture 561.99 498.72 -11.3%
Envi ronment 292.11 248.73 -14.9%
Counter-t errorism 157.05 185.27 18.0%
Rule of Law210.73317.2850.6%
Source: U.S. Department of State Foreign Operations Congressional Budget Justification, FY2008,
and CRS calculations.
Presidential Initiatives. The Bush Administration has made several pledges
for multi-year increases in foreign aid that affect the FY2008 budget. Two initiatives
focus on health issues — HIV/AIDS and malaria — while another promises to
double assistance to Africa. The Millennium Challenge Corporation, launched in
2004, administers performance-based aid to countries showing a strong commitment
to sound economic policies and good governance.
HIV/AIDS. In launching this five-year initiative in 2003, the President pledged
to provide a total of $15 billion by FY2008. With the $4.15 billion request in Global
HIV/AIDS Initiative (GHAI) funds, $346 million in CSH, and a $300 million
contribution to the Global Fund from the Department of Health and Human Services,
total funding over the five year period would meet the pledge. On May 30, 2007,
President Bush announced a follow-on plan to provide a total of $30 billion through
Malaria. The President announced an increased focus on malaria in 2006,
pledging that the United States would spend an additional $1.2 billion over a five-
year period (FY2006-FY2010). Congress appropriated $122 million in FY2006 and
$248 million in FY2007. The President’s request for FY2008 is $388 million,
keeping the pledge on target.
Africa. Prior to the 2005 G-8 Summit, the Administration announced that it
would double U.S. assistance to Africa by 2010. The FY2008 request keeps the
doubling pledge on track. Excluding Millennium Challenge compacts, bilateral
assistance to the region would increase by 37% in 2008 from FY2007, largely driven
by HIV/AIDS funds with decreases in other sectors, such as agricultural productivity,
water supply and sanitation, and family planning and reproductive health.
MCC. In announcing the creation of the new independent Millennium
Challenge Corporation, the President pledged $5 billion annual funding by FY2006.
In fact, requests have never topped $3 billion a year, which is also the amount
requested for FY2008. Congress has consistently cut the MCC request with some
Members expressing concern that the program was slow to get started, and has not
disbursed much of its existing funding.
HIV/AIDS and Tuberculosis Funding. Increased levels of funding for
HIV/AIDS and TB programs drive the overall increase in the foreign aid budget.
Funded through a number of accounts, the largest share is managed by the State
Department’s Office of the Global HIV/AIDS Coordinator for PEPFAR-focus
countries. Other AIDS funding is provided through the Child Survival and Health,
ESF, SEED, and FSA accounts. Other funds are provided in the Departments of
Labor, Health and Human Services, and Education appropriations bills for the
Centers for Disease Control and Prevention, National Institutes of Health, and the
Department of Health and Human Services (HHS).
In previous budget requests, the Administration proposed making a contribution
to the Global Fund for HIV/AIDS, Malaria, and TB from three accounts: the Global
HIV/AIDS Initiative; Child Survival and Health; and the Department of Health and
Human Services. The Administration’s requests have totaled $300 million each year
since FY2006, shared equally among the three sources. This year, the Administration
proposes making the $300 million contribution entirely from HHS. In previous
years, Congress has provided increased resources for the Global Fund beyond that
requested by the Administration, providing it with $544.5 million in FY2006 and
$625 million in FY2007. (These figures do not include the HHS portion of the
contribution that has ranged between $99 million in fiscal years 2003, 2005, 2006,
and 2007, and $149 million in FY2004.)
This year’s budget request includes a substantial increase for the Global
HIV/AIDS Initiative (GHAI), the account that funds the 15 focus countries under the
PEPFAR initiative. Funding for GHAI would reach $4.15 billion, up from $3.25
billion in FY2007. The CSH account would fund most other HIV/AIDS programs
in non-focus countries at about $314 million. Funds to address tuberculosis would
total $89.9, with most of the funds coming from the CSH account. Total foreign
operations funding for AIDS and TB programs would top $4.5 billion.19
MCC Compacts and Other Aid Accounts. When first announced in 2002,
the initiative was portrayed as being in addition to, not a substitute for, existing U.S.
aid programs. This portrayal led to the expectation that a country that signed a
Compact would not see funding for other programs decrease. As the program got up
and running in 2004, and in subsequent fiscal years, a stronger argument can be made
that Compact countries are seeing cuts in other types of aid programs. With the
FY2008 budget request, the correlation between MCC and other types of assistance
became more apparent with Administration officials stating the aid coordination
process included linkages between the two aid sources. In addition, officials said that
the promise made at the time of MCC’s creation of it being additive in nature did not
apply at the country level, but rather to overall U.S. foreign assistance funding levels.
The new budgeting process created by State’s F bureau sought to coordinate all
foreign aid programs within State, USAID, and some related independent agencies,
including MCC. Of the eleven compact countries, all but Vanuatu have seen cuts in
other aid programs since FY2006. It should be noted, however, that Armenia and
Georgia were already scheduled for reduced assistance as FSA (Assistance for the
Independent States of the Former Soviet Union) countries are eventually graduated
from aid. Table 8 provides compact countries and their levels of assistance for the
last four years. USAID also provides assistance to help countries become eligible for
the MCC program.20
Table 8. Compact Countries, U.S. Assistance, FY2005-FY2008
(millions of current U.S. dollars)
MCC FY2007a FY2008
Co unt ry Co mpact FY2005 FY2006 Request Request
Armenia$236 million over5 years85.4776.3158.1440.78
Benin$307 million over5 years17.1416.7312.0114.01
Cape Verde$110 million over5 years1.857.011.952.42
El Salvador$461 million over5 years40.3947.7835.0927.51
Georgia$295 million over5 years107.3287.3975.8466.42
Ghana$547 million over5 years40.7772.1037.9244.29
Honduras$215 million over5 years40.1553.1130.7642.51
19 For more information, see CRS Report RL33485, U.S. International HIV/AIDS,
Tuberculosis, and Malaria Spending: FY2004-FY2008.
20 For more information, see CRS Report RL32427, Millennium Challenge Account.
MCC FY2007a FY2008
Co unt ry Co mpact FY2005 FY2006 Request Request
Madagascar$110 million over4 years25.2440.6722.0135.66
Mali$461 million over4 years42.2542.4837.7032.88
Nicaragua$175 million over5 years42.7150.1826.3332.01
Vanuatu$66 million over5 years2.342.222.352.31
Source: Millennium Challenge Corporation ([http://www.mcc.gov]); U.S. Department of State
Summary Tables, Congressional Budget Justifications, FY2008 and FY2007.
a. Estimates for FY2007 have not been finalized. Figures used here reflect requested amounts.
Use of Supplementals. Supplemental resources for Foreign Operations
programs, which in FY2004 exceeded regular Foreign Operations funding, have
become a significant channel of funds for U.S. international activities, especially
those related to reconstruction efforts in Iraq and Afghanistan. Supplemental
appropriations bills have often been used as vehicles to provide additional funding
to respond to unanticipated emergencies or natural disasters.
There has been some criticism that the Administration has relied too heavily on
supplementals and that some items, particularly relating to Iraq, should be
incorporated into the regular appropriations cycle. The Administration counters that
given the nature of rapidly changing overseas events and unforeseen emergencies, it
is necessary to make supplemental requests for unexpected and non-recurring
Figure 3 shows the growing reliance on Foreign Operations supplementals. A
supplemental request for FY2007 totaled $5.99 billion, including $350 million in
P.L. 480 food aid.21 Congress approved a FY2007 supplemental bill (H.R. 2206) that
was signed by the President on May 25 providing $6.146 million in international
affairs spending, including $460 million in international food assistance.
21 For more information on the FY2007 Supplemental, see CRS Report RL33900, FY2007
Supplemental Appropriations for Defense, Foreign Affairs, and Other Purposes, by Stephen
Daggett, Amy Belasco, Pat Towell, Susan B. Epstein, Connie Veillette, Curt Tarnoff, and
Figure 3. Foreign Operations Supplemental Funding
20urre Regul ar
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Source: CRS calculations based on enacted appropriations measures.
Note: Figures are in current U.S. dollars. All figures include regular and supplemental appropriations.
FY2008 Emergency Supplemental Requests. With the FY2008 regular
budget, the Administration also presented Congress with an FY2008 GWOT
emergency request. On October 22, 2007, a second emergency supplemental request
was sent to Congress. The first package, totaling $3.301 billion for international
affairs, included $1.367 billion for foreign operations. Iraq and Afghanistan
dominated the request, with $772 million for Iraq and $339 million for Afghanistan
in ESF funds. Iraq would also receive $159 million in International Narcotics
Control and Law Enforcement funds for human rights, anti-corruption, and rule of
law programs. The total also included a $35 million request to assist Iraqi refugees
in neighboring countries and conflict-affected populations in Iraq. Operating
expenses for USAID would total $61.8 million for operations in Iraq and
The second request included an additional $1.961 billion, for a total of $3.328
billion in FY2008 supplemental funds. Iraq is proposed to receive an additional $265
million, and Afghanistan $500 million. The request also included $500 million in
counter-narcotics funding for Mexico, and from the Economic Support Fund, $350
million in budget support for the Palestinian Authority, $106 million to support the
Six Party Talks to denuclearize North Korea, and $70 million to support elections in
Sudan and stabilization activities in Southern Sudan. Although not part of foreign
operations appropriations, the request included $350 million in P.L. 480 food
assistance, largely for Africa.
Iraq and Afghanistan Share of Total Aid Budget. Including both base
budgets and supplemental appropriations, the share of U.S. bilateral foreign
assistance going to Iraq and Afghanistan has increased sharply since FY2002.
Foreign aid to Afghanistan mushroomed from $590 million in FY2003 to $1.799
billion the next year. Assistance to Iraq consisted of small sums to support Iraqi
opposition groups in the early 2000s, but picked up precipitously in FY2004 to more
than $17 billion, and then fell to $1.6 billion in FY2006 and roughly $2.5 billion in
FY2007. Table 9 tracks funding to both countries from FY2002 through FY2008
and includes both regular budgets and supplemental funds. Amounts for FY2008
represent requested amounts.
FY2007 regular and supplemental funding for Iraq and Afghanistan together
comprises about 16% of total foreign aid spending. The share of the FY2008 budget
would be just under 13%.
Table 9. Funding for Iraq and Afghanistan, FY2002-FY2008
(millions of current U.S. dollars)
FY02 FY03 FY04 FY05 FY06 FY07 FY08
Iraq 25.0 2,890.0 17,849.5 27.7 1,626.8 2,495.3 1,668.6
Af ghan 686.1 589.6 1,798.7 2,674.1 950.7 1,682.4 1,922.1
Source: U.S. Department of State, Foreign Operations Congressional Budget Justifications, FY2004
through FY2008, and CRS calculations. Figures here do not include Department of Defense funds.
For more information, see CRS Report RL31833 Iraq: Reconstruction Assistance, by Curt Tarnoff,
and CRS Report RL30588 Afghanistan: Post-War Governance, Security, and U.S. Policy, by Kenneth
Note: Figures for FY2008 are requested levels.
As the end of the first session of the 110th Congress approached, H.R. 2764, the
State, Foreign Operations, and Related Programs Appropriations bill, became the
vehicle for a $555 billion omnibus spending bill that included funding for domestic
agencies and for some of the FY2008 emergency supplemental funding requested by
the White House. Congress completed action on the measure the week of December
Comprising Division J of the consolidated bill, funding for the international affairs
budget totaled $33.1 billion, of which $10.3 billion was provided for State
Department Operations and $22.9 was appropriated for Foreign Operations. Another
$2.385 billion was provided in emergency FY2008 supplemental funds for
international affairs. Until H.R. 2764 was enacted, government agencies continued
to be funded under a series of continuing resolutions.
The annual budget resolution is non-binding legislation that expresses
Congressional intent with regard to broad spending issues, and provides guidance to
the Appropriations Committees on spending limits. The Appropriations Committees
use the budget resolution to arrive at discretionary allocations (called 302b
allocations) for each of the spending panel’s subcommittees which act as spending
ceilings for each bill.
On March 23, 2007, the Senate passed the FY2008 Budget Resolution
(S.Con.Res. 21) that included $39.8 billion in international affairs spending authority.
This amount matches the President’s request; the Senate resolution also provided his
request for $3.3 billion in emergency funds for Iraq and Afghanistan. The Senate
Budget Committee had reported out the budget resolution with a cut to the request.
During floor consideration, the Senate approved an amendment to restore $2.2 billion
to the foreign affairs budget. The House passed its version of the FY2008 Budget
Resolution (H.Con.Res. 99) on March 29, providing $35.3 billion for international
affairs, and did not include the emergency request. The House level was $1.2 billion
less than the President’s request.
The House and Senate approved the conference report on May 17, 2007 in
which the lower House figure for international affairs was adopted. The overall
budget sets a total discretionary figure of $954 billion from which allocations will be
derived that will guide the Appropriations Committees in writing the FY2008
On June 5, 2007, the House Appropriations Committee adopted its 302b
allocations that set spending ceilings for each appropriations bill. The State
Department, Foreign Operations, and Related Agencies allocation for discretionary
spending is $34.243 billion, which is 9.5% above FY2007 levels. The allocation is
2% below the President’s request of $34.943. The Senate’s 302b allocation is equal
to that of the House.
House Appropriations Action
On June 5, the House Appropriations Subcommittee on State, Foreign
Operations, and Related Agencies marked up the FY2008 spending measure. The22
bill provides a total of $34.243 billion. Of the total, $10.76 billion is for Title I —
State Department Operations, international broadcasting, and related agencies, and
$23.62 billion is for foreign assistance programs. The total is $2.95 billion over last
year’s level and $700 million less than the President’s request.
On June 12, the full House Appropriations Committee reported out the bill after
several amendments were considered. Those amendments are described in the
relevant sections below.
State Department and Related Agencies — Committee Action
Within Title I, the House Appropriations Committee recommended $10.04
billion for the Department of State, which is $29.4 million less than the President’s
FY2008 request of $10.1 billion. The increase amounts to about a .3% increase. The
22 The bill provides a total of $3.4 billion when including mandatory payments to the
Foreign Service Retirement and Disability Fund, as reflected in the tables at the end of this
recommendation, however, amounts to $1.05 billion (or nearly 12%) more than the
FY2007 funding level for the Department of State.
For international broadcasting, the committee recommended $682.3 million for
FY2008. This is $14.1 million, about 2%, more than the President’s request. The
subcommittee recommendation is $38.3 million, nearly 6%, more than the FY2007
For related agencies, the committee recommended $36.9 million, nearly $5
million (about 12%) below the President’s FY2008 request of $41.8 million. This
amount is nearly the same as the related agencies’ FY2007 enacted level of $36.7
Administration of Foreign Affairs. The House Appropriations Committee
recommended $4.8 billion for State’s Diplomatic and Consular Programs (D&CP).
This funding level, which is $157.7 million below the request but $446.3 million
above the FY2007 level, includes $964.8 million for worldwide security upgrades,
as requested ($198.8 million greater than the FY2007 level) and $363.9 million for
public diplomacy international information programs ($5 million above the request
to pay for an international public diplomacy center).
The committee included $1.3 billion from Machine Readable Visa fees to be
used for border security, including processing of passports. Within the Manager’s
amendments, the committee expressed concern about the backlog in the Department
of State’s processing of passports since the January implementation of phase I of the
Western Hemisphere Travel Initiative and requested quarterly reports from the
Department on this issue.
Right-sizing of U.S. overseas posts is another concern within D&CP. The
committee expressed concern about the escalation of staff in Iraq. At the same time,
the Manager’s amendment package contained language to increase diplomatic
resources in Central and East Africa. The committee encouraged the interagency
cost-sharing system referred to as ICASS.
For Educational and Cultural Exchange Programs, the committee recommended
$501.4 million, $55.7 million more than the President’s FY2008 request. Within this
amount, the committee recommended $218.8 million for the Fulbright program. In
addition, the Manager’s amendments included language to expand exchanges with
the Caribbean and encourage the Exchange bureau to work with the U.S. Olympic
The House Appropriations Committee recommended a total of $1.6 billion for
Embassy, Security, Construction, and Maintenance (ESCM) — $729.9 million for
the regular budget and $806.9 million for worldwide security upgrades. The total is
$62.6 million less than the request, taken from the regular ESCM budget. The total
is $45.9 million below the FY2007 level.
International Organizations, Peacekeeping, and Conferences. For
Contributions to International organizations, the House committee recommended
$1.35 billion, which is the same as the President’s FY2008 request and is $204
million above the FY2007 enacted level. In this funding, the committee supported
the U.N. regular budget and numerous other international organizations, such as the
North Atlantic Treaty organization (NATO) and the World Health Organization.
For Contributions for International Peacekeeping, the House committee
recommended $1.3 billion, which is $195 million more than the request and $166.7
million more than the FY2007 funding level. In addition, the committee expressed
concern that the Administration’s request represents a 3% reduction from the
FY2007 level, although it has sought to expand the U.N.’s peacekeeping missions in
Lebanon and Darfur.
International Commissions. For international Commissions, the House
Appropriations Committee recommended a total of $148.8 million. This amount is
$15.3 million above the FY2008 request and $82.2 million above the FY2007
enacted level. The funds will provide for International Boundary and Water
Commission, United States and Mexico water construction projects, and flood
control systems, among other things.
Related State Department Appropriations. The House committee
recommended $96.8 million for various related agencies, including $10 million to the
Asia Foundation and $80 million for the National Endowment for Democracy. The
committee did not provide any funding for the East-West Center, which received $19
million for its FY2007 appropriation and had a FY2008 request of $10 million. The
full committee noted that the center can compete for federal grants and outside
U.S. Institute of Peace (USIP). The House Appropriations Committee
recommended $25 million for USIP in FY2008. This is $5 million below the
President’s request but $2.9 million above the FY2007 funding level. (An agreed-to
amendment would transfer $1 million to USIP from State Department’s D&CP
account, by offset, to revive the Iraq Study Group.)
Broadcasting Board of Governors. The House committee recommended
$671.6 million for the Broadcasting Board of Governor’s (BBG) International
Broadcasting Operations. This level includes $33.7 million for Cuba Broadcasting.
The recommended level is $14.2 million above the President’s FY2008 request and
$35.6 million above the FY2007 funding level. The committee noted the importance
in getting information to the Middle East and expressed concern about recent
programming decisions regarding Alhurra TV programming. The committee
requested the Inspector General to report to the committee on this matter. (During
floor action, the House agreed to a floor amendment that directs $10 million be used
for expanded broadcasting to Venezuela and Latin America.)
In addition to the above funding, the committee recommended $10.7 million for
Broadcasting Capital Improvements, which would provide for maintenance, digital
production development, and security upgrades at overseas transmitting stations.
State Department and Related Agencies — Floor Action
On June 19 and 20, 2007, the House considered numerous amendments to Title
I. Those that were agreed to include transferring $36.7 million from State’s D&CP
account for funding Cuba democracy assistance and $1 million from State’s D&CP
account to USIP for reconvening an Iraq Study Group. Another amendment directs
that $10 million of BBG funds to increase broadcasting to Venezuela and Latin
America. Other Title I amendments would prohibit State Department funds for the
visa lottery program, for visas to certain nationals, and for the U.N. Human Rights
Council, and would limit funds for negotiating new countries to the visa waiver
Foreign Operations — House Committee Action
The Foreign Operations portion of the bill, which provides funding for bilateral
economic and military aid, multilateral assistance, and export and investment
assistance, comprises roughly two-thirds of the total bill. The House Appropriations
Committee provided a total of $23.62 billion in foreign aid programs, a decrease of
3% from the request but an increase of $8.4 billion above last year’s regular spending
bill. An FY2007 supplemental appropriations bill (P.L. 110-28) included $4.42
billion in additional funds, bringing the FY2007 foreign aid total to $26.2 billion.
Major Changes from Request. The bill approved by the House
Appropriations Committee makes major changes from the President’s request. It
provides increased funding for health, including HIV/AIDS, and basic education
programs. It cuts funding for the Millennium Challenge Corporation and Foreign
Military Financing. The bill continues previous year restrictions on the use of family
planning funds but allows for the provision of contraceptives by non-governmental
organizations that would not otherwise be eligible for family planning funds. While
the bill and accompanying report do not explicitly address the new Strategic
Framework on Foreign Assistance, the committee did not adopt some of its major
proposals, most notably, the shift of funds from Development Assistance to the
Economic Support Fund.
!Health. The bill provides $1.957 billion, a 25% increase over the
request and 14% over FY2007, for the Child Survival and Health
(CSH) account for a wide range of health issues. In addition, the bill
provides $4.45 billion for the Global HIV/AIDS Initiative (GHAI),
an increase of 7% over the request and 37% over last year’s level.
Additional health funding would total $112.5 million, with $57.9
million in ESF, $2.4 million in SEED, and $52.2 million in FSA
!HIV/AIDS. The bill provides a total of $5.082 billion for
HIV/AIDS prevention and treatment programs. In addition to the
$4.45 billion in GHAI funding, the bill allocates $600 million in
CSH funds — $250 million for the Global Fund (see below) and
$350 million for bilateral assistance. An additional $32 million is
from the ESF ($6 million) and FSA ($26 million) accounts. The
allocation for GHAI is 7% above the request.
!Global Fund for AIDS, TB, and Malaria. The bill allocates $550
million for the Global Fund, $250 million from the CSH account and
$300 million from GHAI. Unlike in previous years, the
Administration did not request a Foreign Operations contribution for
the Fund, but instead proposed a $300 million transfer from the
Department of Health and Human Services.
!Malaria. The bill provides $352.5 million for malaria treatment and
prevention programs, of which $270 million is designated for the
President’s Malaria Initiative. Of the total, $350 million is allocated
from the CSH account, with the remainder from ESF. The
Administration had requested $387.5 million for malaria programs.
!Tuberculosis. The bill provides $266 million for tuberculosis and
extremely drug-resistant tuberculosis, of which $103 million is from
the CSH account, $150 million from GHAI, $10 million from FSA,
and $3 million from ESF. The Administration had requested $89.9
!Avian Influenza. The bill includes $100 million for avian flu
programs from the CSH account, an amount equal to the request.
!Family Planning and Reproductive Health. The bill provides
$374.2 million for Child Survival and Maternal Health programs,
and $441 million for Reproductive Health and Voluntary Family
Planning, of which $375 million is from the CSH account.
!Contraceptives. New language (Section 622) exempts the
provision of contraceptives from the March 28, 2001, Memorandum
to the Administrator of USAID. The memo restored the Mexico
City language that required foreign NGOs to certify that they do not
perform or promote abortion as a method of family planning in order
to receive U.S. family planning assistance. The bill retains language
from previous years that restricts funding to organizations that
support or participate in programs of coercive abortion or
involuntary sterilization. The bill also retains language prohibiting
funding for the performance of abortions.
!Development Assistance and Economic Support Fund. The bill
provides $1.734 billion for the Development Assistance (DA)
account, an increase of 67% over the request. The President’s
budget proposed a sharp decrease in DA, down 31% from FY2006,
because of a shift of funds to the ESF account as a result of the
Strategic Framework on Foreign Assistance. The President’s budget
called for a 35% increase in ESF. Instead, the bill provides $2.66
billion for ESF, a reduction of 20% from the request. Report
language states that the DA account includes $365 million that had
been requested in ESF, and the committee directs that this amount
be provided to certain countries in addition to the requested DA
amounts for Afghanistan ($150 million), Democratic Republic of
Congo ($10 million), Liberia ($30 million), Pakistan ($30 million),
and Sudan ($145 million).
!Basic Education. The bill provides a total of $750 million for basic
education, and directs that $519 million come from the DA account.
Of the total, $265 million is to be used to implement basic education
assistance consistent with H.R. 2092, the Education for All Act of
!Millennium Challenge Corporation. The bill provides $1.8 billion
for MCC, a cut of $1.2 billion from the request. An amendment
offered in full committee to increase this amount by $200 million
!Foreign Military Financing. The bill provides $4.46 billion for the
FMF program, a 2% decrease from the request.
!Iraq. The bill provides no funding for the Administration’s request
for Iraq. The report notes that Congress provided $2.86 billion for
Iraq in the FY2007 Supplemental, and that more than $3 billion
remains unspent from the Iraq Relief and Reconstruction Fund. In
full committee, an amendment to provide $133 million in Iraq
assistance was defeated.
In other full committee action, a number of amendments were approved
!to increase military assistance to Pakistan by $50 million;
!to require a report, rather than a certification, from the Secretary of
State on human rights in Indonesia;
!to encourage the President to use $50 million for democracy
promotion in Iran;
!to encourage the President to use $10 million in previous years’
funds to protect Iraqi Christians;
!to direct the Secretary of State to review the need for enhanced
facilities of the Haitian Parliament and to consider granting an
exception to current Department policy, allowing a portion of the
$23.9 million requested for democracy assistance to be used by Haiti
to purchase the U.S. Embassy property adjacent to the Haitian
!to clarify the dates on which the State Department must report to
Congress with regard to restrictions on family planning funds;
!to require a report from the State Department on the evidence and
criteria used if the Department should determine that an organization
or program supports and participates in the management of a
program of coercive abortion or involuntary sterilization;
!to recommend that Development Assistance funding for countries in
the Western Hemisphere be increased by $56 million to restore
country program levels to at least FY2006 levels.
Foreign Operations — Floor Action
The House completed action on H.R. 2764 (H.Rept. 110-197) on June 22, 2007,
including several amendments. The overall funding levels remain the same as the
committee-reported bill, but some amendments result in changes to funding levels
for certain accounts. Other amendments added provisions restricting the use of
certain funds. The amendments approved by the House include the following:
!An amendment to prohibit direct aid to the Palestinian Authority
(PA) was adopted by a vote of 390-30. The bill includes $64 million
in aid to the Palestinian Authority in the West Bank and Gaza. The
amendment requires the President to certify that the PA has
renounced terrorism, acknowledged the existence of Israel, and is
abiding by previous agreements reached between the Palestinians
and Israel before any aid can be released.
!An amendment to clarify bill language regarding the provision of
donated contraceptives was adopted by a vote of 223-201. The
amendment provides that no contract or grant for the exclusive
purpose of providing donated contraceptives in developing countries
would be denied to any non-governmental organization solely on the
basis of the Mexico City policy, which bars U.S. aid to international
family planning organizations that perform or promote abortions,
even if they use their own funds to do so.
!An amendment to increase ESF funds for Cuba democracy programs
was adopted by a vote of 254-170. The amendment adds $37
million, bringing the total up to the Administration’s request of $45
million, and offsets the increase by reducing funds for the State
Department’s Administration of Foreign Affairs.
!An amendment to prohibit the use of funds for assistance to Saudi
Arabia was adopted by a voice vote. The bill provides IMET and
NADR assistance for Saudi Arabia.
!An amendment to expand notification requirements for contributions
for international peacekeeping was adopted by voice vote. Current
law requires peacekeepers who commit crimes to be held
accountable; the amendment adds language calling on the U.N. to
seek criminal prosecutions.
!An amendment to increase tuberculosis funding in the CSH account
by $50 million was adopted by voice vote. Half of the amount
would come from the CSH account, with the other half from ESF.
!An amendment that directs $5 million in CSH funds for improving
the health infrastructure in Africa was adopted by voice vote.
!An amendment that directs $5 million in DA funds for Liberia was
adopted by voice vote.
!An amendment that prohibits the United States from entering into a
permanent basing rights agreement with Iraq was adopted by voice
!An amendment that removes Liberia from the list of countries
requiring special notification to Congress prior to the obligation of
funds was adopted by voice vote.
!An amendment that prohibits funds in the bill to be used to enforce
a 2001 State Department memo was adopted by voice vote. The
memo sets out the protocol for meeting with Taiwanese officials.
!An amendment that prohibits assistance to any country whose
government does not accept the transfer from the United States of
citizens or nationals who have been issued a final removal order by
U.S. Immigration and Customs Enforcement was adopted by voice
!An amendment that designates $75 million in ESF funds to be used
for basic education in Pakistan was adopted by voice vote.
!An amendment that prohibits the purchase of light bulbs that do not
have an “Energy Star” designation was adopted by voice vote. Such
light bulbs meet federal energy-efficiency guidelines.
!An amendment prohibiting ESF funds for Ethiopia was adopted by
voice vote. Ethiopia is scheduled to receive $5 million in ESF
funding in FY2008.
!An amendment to prohibit funds for the International Seabed
Authority was adopted by voice vote.
!An amendment to prohibit funds to send or pay for the attendance of
more than 50 employees from a federal department or agency at any
single conference outside the United States was adopted by voice
!An amendment to increase funding for the U.N. Democracy Fund by
$14 million and the U.N. Innovation and Entrepreneurship Initiative
by $6 million was adopted by voice vote. The increase in funds
would come from the U.N. Development Program.
A number of amendments failed passage on the floor. Such amendments
included the following:
!An amendment to increase funding for assistance to Iraq failed by a
vote of 205-219. The bill provides no assistance to Iraq; the
amendment would have provided $158 million.
!Three amendments to reduce the bill’s total funding level failed.
One amendment, to reduce discretionary spending by 0.5%, failed
by a voice vote of 179-241. A second amendment to reduce
discretionary spending by 1% failed by a vote of 168-252. A third
amendment to reduce funding by nearly $3 billion also failed, by a
vote of 152-268.
!An amendment to bar funds to recruit and send students to the
Western Hemisphere Institute for Security Cooperation failed to pass
by a vote of 203-214.
!An amendment to remove the bill’s restrictions on $200 million in
FMF funding for Egypt failed by a vote of 74-343.
!An amendment that eliminated language in the bill regarding the
provision of donated contraceptives to NGOs otherwise ineligible to
receive funds under the Mexico City policy was defeated by a vote
!An amendment that eliminated language in the bill mandating that
33% of GHAI funds be used for abstinence education was defeated
by a vote of 200-226.
!An amendment to reduce U.S. contributions to international
organizations by $203 million failed by a vote of 137-287.
!An amendment to transfer $20 million from U.S. contributions to the
United Nations to the NADR account failed by a vote of 192-232.
Senate Appropriations Action
On June 28, 2007, the Senate Appropriations Committee reported out its version
of the FY2008 State, Foreign Operations and Related Programs bill. It was passed
by the full Senate on September 6 by an 81-12 vote. The Senate version provides a
total of $34.2 billion in discretionary spending, the same as the House-passed bill.
Several provisions of the Senate bill differ from those of the House version. The
Senate appointed conferees also on September 6.
State Department and Related Agencies — Committee Action
The Senate Appropriations Committee recommended $10.08 billion for State
Department operations (including NED funds). This represents $71 million more
than the House-passed appropriation. In addition, the Senate committee
recommended $673.4 million for international broadcasting, nearly $9 million below
the House-passed level. It approved $35.7 million ($2.2 million below the House
level) for related agencies. Some key differences from the House-passed bill include
!The Senate bill provides $102 million for NED, $22 million more
than the House or the FY2007 levels. The Senate bill also moves
the NED funding to Title III under the heading Democracy Fund,
rather than fund it in State Department Operations, Title I, where it
traditionally has been funded and where it is in the House bill.
!The Senate bill provides $48 million more than the House for
Diplomatic and Consular Programs, but $55 million less for
worldwide security upgrades within that account. The bill renames
the subaccount Worldwide Security Protection.
!The Senate bill recommends $509.5 million (about $8 million more
than the House bill) for Educational and Cultural Exchanges. The
funding provides $222.6 million for the Fulbright Program (the
House bill provides $218.8 million) and $2 million for a new
Senator Paul Simon Study Abroad Foundation, as requested by the
!The Senate bill recommends $50 million more than the House bill
for Contributions to International Peacekeeping Activities. The
Senate report accompanying the bill (S.Rept. 110-128) notes that the
administration request was unrealistically low and states that
additional missions are expected in FY2008, including in Chad, the
Central African Republic, Somalia, and possibly Darfur.
!The Senate bill provides $20 million for the East-West Center,
whereas the House bill provides no funding.
!The Senate bill provides $662.7 million ($8.9 million less than the
House) for international broadcasting. The Senate funding measure,
however, does not include funds to continue expansion of Alhurra
TV broadcasting to the Middle East, started by $10 million in the
Iraq war supplemental (P.L. 110-28). The committee expressed
concern about recent reports of Alhurra allowing terrorist affiliates
air time and will consider funding in the future.
State Department and Related Agencies — Senate Floor
The Senate completed action on H.R. 2764 (S.Rept. 110-128) on September 6,
2007. Several floor amendments reduced funding for Department of State
Diplomatic and Consular Affairs general administration to fund increases in some
foreign aid accounts (see “Foreign Operations” section below). Other floor
amendments included the following:
!A Leahy amendment to require the Secretary of State to establish
visa processing facilities in Iraq within 180 days of enactment was
adopted by unanimous consent. It also requires a report to Congress
no later than 30 days after enactment on funding and security
requirements for consular operations in Iraq in FY2008.
!A Cardin amendment to increase funding for the Commission on
Security and Cooperation in Europe by $333,000 and to reduce
funds for State’s Diplomatic and Consular Affairs general
administration by the same amount was adopted by unanimous
Foreign Operations — Senate Committee Action
The foreign operations portion of the Senate bill, as it was reported out of
committee, is similar to the House bill in many respects, including language that
would allow the provision of contraceptives to NGOs who are ineligible to receive
funding because of Mexico City restrictions. The White House has stated that it will
likely veto a bill that contains this provision. Like the House bill, it does not provide
assistance to Iraq. The Senate bill differs from the House version in several aspects.
!The Senate bill provides $1.2 billion for the Millennium Challenge
Corporation, $600 million below the House level and $1.8 billion
below the request.
!For a second year, the Senate bill incorporates all health-related
funding from various accounts into one Global Health Programs
account that totals $6.531 billion, including PEPFAR funds. The
House bill maintains separate accounts.
!The Senate bill provides $4.479 billion for Foreign Military
Financing, which is $20 million above the House level, and $57
million below the request.
!The Senate bill provides $2.915 billion for the Economic Support
Fund, which is $258.5 million more than the House, but $404.6
million less than the request.
!The Senate bill continues funding for a Democracy Fund, not
requested by the Administration, that would receive $177 million in
FY2008. The House bill proposes no separate Democracy Fund
Foreign Operations — Senate Floor Action
The Senate completed action on H.R. 2764 (S.Rept. 110-128) on September 6,
standing Mexico City policy. The overall funding level remains the same as the
committee-reported bill and the House-passed measure. Major amendments
approved on the floor include the following:
!A Boxer amendment to repeal the Mexico City policy was adopted
by a vote of 53-41. The Mexico City policy bars U.S. aid to
international family planning organizations that perform or promote
abortions, even if they use their own funds to do so.
!A Brownback amendment to include language commonly referred
to as the Kemp/Kasten provision to bar the use of funds from being
made available to any organization or program that, as determined
by the President, supports or manages a program of coercive
abortion or involuntary sterilization was adopted by a vote of 48-45.
!A Coburn amendment to prohibit funding for the U.S. contribution
to the United Nations unless copies of all grants, contracts, and other
financial and procurement information are posted on a publicly
available website was adopted by a vote of 92-1.
!A Vitter amendment to bar the use of funds by any international
organization, agency, or entity, including the United Nations, that
requires the registration of, or taxes, a gun owned by a citizen of the
United States was adopted by a vote of 81-10.
!A Martinez amendment to increase funding for democracy
promotion in Cuba from $15 million to $45.7 million, matching the
Administration’s request, was adopted by voice vote.
!A Lieberman amendment to increase funding for democracy
promotion programs in Iran from $25 million to $75 million was
adopted by unanimous consent.
!A Feinstein and Dodd amendment to increase funding for the Peace
Corps by $10 million, from $323.5 million to $333.5 million, and
reduce funding for Foreign Military Financing by the same amount
was adopted by voice vote.
!A Leahy amendment to expand the existing human rights
certification for assistance to Bolivia to include police forces was
adopted by unanimous consent.
!A Leahy amendment to condition assistance to Morocco was
adopted by unanimous consent. The provision requires that the
Secretary of State certify that Morocco is ceasing to persecute,
detain, and prosecute individuals for expressing their opinions with
regard to the Western Sahara, and is providing unimpeded access to
NGOs, journalists, and representatives of foreign governments.
!A Leahy amendment to add gross human rights violations to a
provision that prohibits assistance to countries that grant sanctuary
to any individual or group that has committed an act of international
terrorism was adopted by unanimous consent.
!A Gregg amendment to prohibit any funds in the bill to be used for
aid to Iraq was adopted by unanimous consent. Funds can be
expended if the Secretary of State certifies that the Department of
State and Department of Defense are providing the Committees on
Appropriations full and unfettered access to programs in Iraq for
!A Gregg amendment to require that recipient countries make public
their budgets on an annual basis was adopted by unanimous consent.
!A Gregg amendment to permit the use of $500 million in ESF funds
for Egypt for a U.S.-Egypt Friendship Endowment was adopted by
!An Alexander amendment to increase funding for the Overseas
Private Investment Corporation by $8 million and decrease
contributions to the World Bank’s International Development
Association by the same amount was adopted by unanimous consent.
!A Brown amendment to increase global health funds for the
treatment of drug-resistant tuberculosis by $90 million, and cut $65
million from the State Department’s Diplomatic and Consular
Affairs general administration and $25 million from the Asian
Development Fund, was adopted by unanimous consent.
!An Obama amendment to require the President to propose a
comprehensive nuclear threat reduction and security plan was
adopted by unanimous consent.
!A Coleman amendment to prohibit U.S. funds for the U.N. Human
Rights Council unless the President certifies that it is in the national
interest, or the United States is a member, was adopted by
A number of amendments failed passage on the floor. Those amendments
included the following:
!A Coburn amendment to bar the use of multilateral economic
assistance funds for the World Bank’s malaria control or prevention
programs was rejected by a vote of 33-60.
!A Coburn amendment to redirect $106.8 million from the Global
Environmental Facility to the President’s Malaria Initiative and
Child Survival and Health programs was rejected by a vote of 46-47.
!A Brownback amendment to strike language in the bill providing
that no contract or grant to provide donated contraceptives in
developing countries would be denied to any non-governmental
organization solely on the basis of the Mexico City policy was
rejected by a vote of 41-53.
!An Ensign amendment to strike a provision in the bill that increases
the limit on the U.S. share of U.N. peacekeeping operations from
Appendix A. Acronyms
ACIAndean Counterdrug Initiative
CSHChild Survival and Health
ERMAEmergency Refugee and Migration Assistance
ESFEconomic Support Fund
FMFForeign Military Financing
FSAFreedom Support Act — Assistance to the Independent States of the
Former Soviet Union
GHAIGlobal HIV/AIDS Initiative
IDFAInternational Disaster and Famine Assistance
IMETInternational Military Education and Training
INCLEInternational Narcotics Control and Law Enforcement
MCCMillennium Challenge Corporation
MRAMigration and Refugee Assistance
NADRNon-proliferation, Anti-Terrorism, Demining, and Related Programs
PEPFARPresident’s Emergency Plan For AIDS Relief
PL 480Food aid
PMIPresident’s Malaria Initiative
SEEDSupport for Eastern European Democracy Act — Assistance for
Eastern Europe and the Baltic States
DFADirector of Foreign Assistance
EAPEast Asia and Pacific
EUREurope and Eurasia
LACLatin America and Caribbean
SCASouth and Central Asia
USAIDU.S. Agency for International Development
Appendix B. Foreign Aid Country Categories
Rebuilding: Countries in or emerging from internal or external conflict.
Afgh ani s t an Lebanon
Democratic Republic of the CongoSierra Leone
Transforming: Low or lower-middle income, meeting performance criteria.
Braz il Mozambique
Honduras Tanz ania
Sustaining Partnership: Upper-middle income; aid sustains partnerships.
Bahamas M auritius
Czech RepublicSaudi Arabia
IrelandTrinidad & Tobago
KuwaitUnited Arab Emirates
Developing: Low or lower-middle income, not yet meeting performance criteria.
Algeria M acedonia
Bosnia and HerzegovinaMontenegro
Cape VerdePapua New Guinea
Central African RepublicParaguay
ComorosRepublic of the Congo
Ethiopia S uriname
Georgi a Tajikistan
Guinea-Bi ssau Tunisia
J o rdan Uz bekistan
Restrictive: Significant freedom and human rights issues; legislative and/or
Secretarial-designated limitations on assistance.
The Restrictive country category includes those countries that have restrictions
on the receipt of U.S. assistance either by statute or Secretarial determination. The
State Department does not provide a list of restrictive countries, although the FY2008
Foreign Operations Congressional Budget Justification lists certain countries with
no categorization: Belarus; Burma; China; Cuba; Iran; Libya; North Korea;
Venezuela; West Bank and Gaza; and Zimbabwe.
Appendix C. State Department and Related Agencies Appropriations
(millions of current dollars)
Estimate Supp. Re que s t Em ergency House Senat e Final Supp
le I State Department and Related Agencies
atic & Consular Program4,338.5870.74,942.72,283.04,747.14,729.94,541.1781.6
acy (329.7) ( 20.0) (358.9) 0.0 (363.9) (364.9) (360.9)
Upgr ades (766.0) (96.5) (964.8) 0.0 (964.8) (909.6) (761.9)
iki/CRS-RL34023 cultural exchange prog. (U.S. Information
g/wency) 445.7 20.0 486.4 0.0 501.4 509.5 501.3
s.ornspector General 29.936.532.50.032.535.533.7
leak 8.2 0.0 8.2 0.0 8.2 8.2 8.1
://wikin missions & officials9.30.018.00.028.014.022.8
upgrades 898.6 0.0 806.9 0.0 806.9 792.5 755.1
ergency-diplomatic & consular services4.90.019.00.014.09.08.9
1.3 0.0 1.3 0.0 1.3 1.3 1.3
ment American Inst. Taiwan15.80.016.40.016.416.416.2
n Service Retirement Fund (mandatory)125.00.0122.50.0158.9158.9158.9
nvestment Fund 58.10.070.70.059.163.759.6
Estimate Supp. Re que s t Em ergency House Senat e Final Supp
eeping 1,135.3 283.0 1,107.0 723.6 1,302.0 1,352.0 1,222.5 468.0
66.6 0.0 133.5 0.0 82.8 157.2 155.1
ntr for Middle East-West Dialogue-Trust 0.80.00.90.00.90.90.9
iki/CRS-RL34023ntr for Middle East-West Dialogue Program 0.90.00.00.00.00.00.0
g/w 13.8 0.0 10.0 0.0 15.0 16.0 15.4
leakent for Democracy74.00.080.00.080.0(102.0) 81.0
://wikie 0.5 0.0 0.5 0.0 0.5 0.5 0.5
0.4 0.0 0.4 0.0 0.4 0.4 0.4
108.6 0.0 101.8 0.0 96.8 37.8 117.5 0.0
8,989.4 1,260.2 10,013.8 3,219.6 9,939.7 9,909.6 9,616.0 1,249.6
mprovements 8.0 0.0 10.7 0.0 10.7 10.7 10.7
Operations 602.4 10.0 618.8 0.0 671.6 662.7 659.3 12.0
Estimate Supp. Re que s t Em ergency House Senat e Final Supp
r oadcasting 644.0 10.0 668.2 0.0 682.3 673.4 670.0 12.0
ated Independent Agencies
mm for Preservation America’s Heritage Abroad0.50.00.50.00.50.50.5
mission on International Religious Freedom3.00.03.30.03.43.03.3
mission on Security and Cooperation in Europe2.00.02.00.02.02.02.4
ress-Executive Comm. People’s Rep. of China6.00.02.00.02.02.02.0
China Economic & Security Review Comm3.00.04.00.04.03.04.0
g/w Institute of Peace22.10.030.00.026.025.024.8
leak 36.7 0.0 41.8 0.0 37.9 35.7 37.0 0.0
TAL Title I State/Broadcasting/Related
://wiki 9,670.1 1,270.2 10,723.8 3,219.6 10,659.9 10,618.7 10,323.0 1,261.6
Y2006 estimates include FY2006 supplemental funding (P.L. 109-234) and reflect a 0.28% rescission within Sec. 638, P.L. 109-234 and a 1.0% across-the-board rescission.
he Senate bill funds the National Endowment for Democracy in Title III of the bill under the Democracy Fund. Senate totals for Title I in table above are shown as $102 million
higher than reflected in the Senate report.
Appendix D. Foreign Operations Appropriations
(millions of current dollars)
F Y 2007 F Y 2007 F Y 2008 F Y 2008 F Y 2008 F Y 2008 F Y 2008 F Y 2008
Import Bank (net)55.00.0 1.00.01.01.01.0
erseas Private Investment Corporation (net)(196.1)0.0(159.5)0.0(169.5)(168.5)(166.6)
iki/CRS-RL34023ild Survival & Health (Global Health)e1,718.2161.01,564.30.01,982.22,171.4e1,714.2115.0
s.or Famine Assistance361.4165.0297.380.0322.4322.4319.7110.0
nitiatives 39.6 0.0 37.2 0.0 40.0 50.0 44.6
://wikielopment Credit Authority7.90.07.40.07.48.98.1
httpelopment Credit Authority Subsidy0.00.0(21.0)0.0(21.0)(21.0)(21.0)
D Operating Expenses626.88.7609.061.8625.7645.7629.920.8
D Capital Investment Fund69.30.0126.00.087.390.587.3
D Inspector General35.63.538.00.038.038.037.7
ic Support Fund2,455.02,624.33,319.62,217.02,668.22,915.02,432.4542.6
r eland 13.4 0.0 0.0c 0.0 15.0 0.0 14.9
Baltic States (SEED)273.9214.0289.30.0297.3294.6293.6
er Soviet Union (FSA)452.00.0351.60.0397.6401.9396.5
Estimate Supp Request Em ergency House Senat e Final Supp
319.6 0.0 333.5 0.0 333.5 333.5 330.8
g/wration & Refugee Assistance833.0130.5773.5230.0829.9889.0823.2200.0
s.orergency Refugee & Migration Assistance Fund55.055.055.00.045.045.044.6
://wiki Department Technical Assistance19.82.824.80.018.022.820.2
http 64.4 0.0 207.3 0.0 200.3 200.3 30.1
n Service Retirement & Disability Fund
) 38.7 0.0 36.4 0.0 0.0 0.0 0.0
itle III Bilateral Economic Assistance15,660.73,937.117,851.83,327.817,286.417,325.516,632.8988.4
Education & Training85.90.089.50.085.185.985.2
n Military Financing4,550.8265.04,536.00.04,509.24,579.04,452.0100.0
itle IV Military Assistance4,860.0495.04,846.70.04,887.54,938.14,763.6135.0
FY2007 FY2007FY2008FY2008FY2008FY2008 FY2008
Estimate Supp Request Em ergency House Senat e Final
ank: Global Environment Facility79.20.0106.80.0106.8106.881.1
: Int’l. Development Association940.50.01,060.00.0950.01,000.0942.3
ank: Multilateral Investment Guarantee Fund0.00.01.10.00.00.00.0
Inter-American Investment Corporation0.00.07.30.00.00.00.0
elopment Bank: Asian Development Fund99.00.0133.90.0115.365.074.5
g/w for Reconstruction & Development0.00.00.00.00.00.00.0
anizations & Programs326.20.0289.40.0333.4313.9316.9
PK O ( 7.0) 0.0 0.0 0.0 0.0 0.0 0.0
21,822.4 4,419.1 24,378.8 3,327.8 23,742.1 23,782.3 22,874.9 1,234.4
roadcasting Total 9,670.11,270.210,723.83,219.610,659.910,618.710,323.01,261.6
oreign Ops & Related Agencies Total31,492.55,689.335,102.66,547.434,401.934,400.933,116.82,385.0
d 1,313.7 460.0 1,319.4 350.0 1,319.4 1,319.4
U.S. Department of State budget documents; House and Senate Appropriations Committees; and CRS calculations. Figures may not total due to rounding.
cludes regular and supplemental appropriations.
unds for Iraq reconstruction were drawn from a separate Iraqi Relief and Reconstruction Fund (IRRF) prior to FY2007, after which assistance has come from traditional aid
$1 million level is included in ESF for Ireland.
. 480 is appropriated in the Agriculture Appropriations measure. Figure includes the Emerson Humanitarian Trust and Dole-McGovern program.
he Senate bill uses a “Global Health Programs” (GHP) account that incorporates funding for health programs from a number of different accounts. The amount reflected here is
an approximation of the portion of GHP that correlates with the CSH account.