Order Code RL31808
Report for Congress
Received through the CRS Web
Appropriations for FY2004:
Transportation, Treasury, Postal Service,
Executive Office of the President, General
Government, and Related Agencies
May 21, 2003
David Randall Peterman and John Frittelli
Coordinators
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress

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

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Appropriations for FY2004:
Transportation, Treasury, Postal Service, Executive
Office of the President, General Government, and
Related Agencies
Summary
This is the first year in which Congress will consider appropriations for the
Department of Transportation, the Department of the Treasury, the United States
Postal Service, the Executive Office of the President, and Related Agencies, as well
as General Government provisions, in a single appropriations bill. Prior to FY2004,
appropriations for the Department of Transportation and related agencies and the
Department of the Treasury and its related agencies were in separate bills. Some
agencies formerly in the Departments of Transportation and the Treasury have been
transferred to the Department of Homeland Security (DHS). Budget numbers in this
report for years prior to FY2004 have been adjusted for these changes to make
comparisons between previous appropriations and FY2004 requested funding.
On February 4, 2003, President Bush presented his FY2004 budget request to
Congress. It requested
! $54.3 billion for the Department of Transportation, 2.6% less than
FY2003;
! $11.3 billion for the Department of the Treasury, 4.6% more than
FY2003;
! $97 million for the United States Postal Service, 9.3% less than
FY2003;
! $790 million for the Executive Office of the President, 1.7% more
than FY2003; and
! $19.6 billion for Related Agencies, 2.1% more than FY2003.
Key issues in transportation appropriations include a proposed $2.3 billion
reduction in the federal-aid highway program and Amtrak’s request for $900 million
more than the Administration’s request.
Among the key issues in treasury and related agencies appropriations are
Internal Revenue Service efforts to enforce compliance with tax laws, the Postal
Service’s interest in additional funding for increasing the security of employees and
mail customers, a proposal to consolidate several separate appropriations within the
Executive Office of the President into a single appropriation, a proposal to allow the
President authority to transfer up to 10% of the annual appropriation among several
offices within the Executive Office of the President, a proposal to create a “Human
Capital Performance Fund” within the Office of Personnel Management to support
performance-driven pay systems for federal employees, and the proposed pay
increase for federal employees. This report will be updated as warranted by events.

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Key Policy Staff
CRS
Area of Expertise
Name
Telephone
Division
Bob Kirk,
RSI
7-7769
Airport Improvement Program
John Fischer
RSI
7-7766
Amtrak
Randy Peterman
RSI
7-3267
Aviation Safety
Bart Elias
RSI
7-7771
E-Government
Harold Relyea
G&F
7-8679
Executive Office of the President
Barbara Schwemle
G&F
7-8655
Federal Aviation Administration
John Fischer
RSI
7-7766
Federal Child Care
Melinda Gish
DSP
7-4618
Federal Election Commission
Joseph Cantor
G&F
7-7876
Federal Employee Health Care Policy
Health Section
DSP
7-5863
Federal Employee Pension Policy
Patrick Purcell
DSP
7-7571
Federal Employee Workers’
Compensation (FECA)
Edward Rappaport
DSP
7-7740
Bob Kirk
RSI
7-7769
Federal Highway Administration
John Fischer
RSI
7-7766
Federal Railroad Administration
John Frittelli
RSI
7-7033
Federal Transit Administration
Randy Peterman
RSI
7-3267
General Provisions
Sharon Gressle
G&F
7-8677
General Services Administration
Stephanie Smith
G&F
7-8674
Highway, Railroad, & Vehicular Safety
Paul Rothberg
RSI
7-7012
Homeland Security
Sharon Gressle
G&F
7-8677
Independent Agencies
Sharon Gressle
G&F
7-8677
Internal Revenue Service
Gary Guenther
G&F
7-7742
National Archives
Harold Relyea
G&F
7-8679
Office of Government Ethics
Mildred Amer
G&F
7-8304
Office of Personnel Management
Barbara Schwemle
G&F
7-8655
Postal Service
Nye Stevens
G&F
7-0208
Presidential Salary
Sharon Gressle
G&F
7-8677
Procurement
Stephanie Smith
G&F
7-8674
Real Estate Brokerage Regulation
William Jackson
G&F
77834
Surface Transportation Board
John Frittelli
RSI
7-7033
Transportation Infrastructure Policy
John Fischer
RSI
7-7766
Treasury Department
Gary Guenther
G&F
7-7742
Division abbreviations:
DSP = Domestic Social Policy
G&F= Government & Finance
RSI = Resources, Science, and Industry Division.

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Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Legislative Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Data note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
FY2003 Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
FY2004 Budget Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Major Funding Trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Title I: Transportation Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Federal Aviation Administration (FAA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Operations and Maintenance (O&M) . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Facilities and Equipment (F&E) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Research, Engineering, and Development (RE&D) . . . . . . . . . . . . . . . 7
Essential Air Service (EAS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Grants-in-Aid for Airports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Federal Highway Administration (FHWA) . . . . . . . . . . . . . . . . . . . . . . . . . . 8
The TEA-21 Funding Framework . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Federal Motor Carrier Safety Administration (FMCSA) . . . . . . . . . . . . . . . 10
Administrative and Operations Expenses . . . . . . . . . . . . . . . . . . . . . . 10
Grants to States and Other Activities . . . . . . . . . . . . . . . . . . . . . . . . . . 10
National Highway Traffic Safety Administration (NHTSA) . . . . . . . . . . . . 11
Federal Railroad Administration (FRA) . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Railroad Safety and Research and Development . . . . . . . . . . . . . . . . . 13
Next Generation High-Speed Rail R&D . . . . . . . . . . . . . . . . . . . . . . . 14
Amtrak . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Federal Transit Administration (FTA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Restructuring the Capital Investment Grants and Loans Program . . . . 15
Eliminating the Bus & Bus Facilities Program . . . . . . . . . . . . . . . . . . 15
Proposed New Freedom Initiative . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Maritime Administration (MARAD) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Research and Special Programs Administration (RSPA) . . . . . . . . . . . . . . 19
Title II: Treasury Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Department of the Treasury Budget and Key Policy Issues . . . . . . . . . . . . . 20
Internal Revenue Service (IRS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Title III: Postal Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Title IV: Executive Office of the President (EOP) and Funds Appropriated
to the President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
EOP Offices Funded Through Treasury and General
Government Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Compensation of the President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
White House Office (WHO) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Office of Homeland Security (OHS) . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Executive Residence (White House) Operation and Care . . . . . . . . . . 28

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Special Assistance to the President (Office of the Vice President) . . . 28
Official Residence of the Vice President . . . . . . . . . . . . . . . . . . . . . . . 29
Council of Economic Advisers (CEA) . . . . . . . . . . . . . . . . . . . . . . . . 29
Office of Policy Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
National Security Council (NSC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Office of Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Office of Management and Budget (OMB) . . . . . . . . . . . . . . . . . . . . . 30
Office of National Drug Control Policy (ONDCP) . . . . . . . . . . . . . . . 30
The Counterdrug Technology Assessment Center (CTAC) . . . . . . . . 30
Federal Drug Control Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Other Federal Drug Control Programs (formerly The
Special Forfeiture Fund) . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Unanticipated Needs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Title V: Independent Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Federal Election Commission (FEC) . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Federal Labor Relations Authority (FLRA) . . . . . . . . . . . . . . . . . . . . . 33
General Services Administration (GSA) . . . . . . . . . . . . . . . . . . . . . . . 33
Federal Buildings Fund (FBF) . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Electronic Government Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Merit Systems Protection Board (MSPB) . . . . . . . . . . . . . . . . . . . . . . 37
Office of Personnel Management (OPM) . . . . . . . . . . . . . . . . . . . . . . 37
Human Capital Performance Fund . . . . . . . . . . . . . . . . . . . . . . . . 39
Office of Special Counsel (OSC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Title VI: General Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Federal Personnel Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
General Schedule Pay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Federal Wage System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Senior Executive Service Salaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Human Capital Performance Fund . . . . . . . . . . . . . . . . . . . . . . . . 43
Members of Congress, Judges, and Other Officials . . . . . . . . . . . . . . 43
President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Federal Employees Workers’ Compensation Program (FECA) . . . . . 44
List of Transportation Acronyms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
For Additional Reading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
CRS Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Selected World Wide Web Sites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Appendix 1: The Transportation Appropriations Framework . . . . . . . . . . . . . . . 50
Transportation Equity Act for the 21st Century (TEA-21) . . . . . . . . . . . . . . 50
Wendell H. Ford Aviation Investment and Reform Act for the 21st
Century (FAIR21 or AIR21) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Appendix 2: Transportation Budget Terminology . . . . . . . . . . . . . . . . . . . . . . . . 52
List of Figures
Figure 1. Federal Aviation Administration Appropriations . . . . . . . . . . . . . . . . . 6

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Figure 2. Federal Highway Administration Appropriations . . . . . . . . . . . . . . . . . 8
Figure 3. National Highway Traffic Safety Administration Appropriations . . . 11
Figure 4. Federal Railroad Administration Appropriations . . . . . . . . . . . . . . . . . 13
Figure 5. Federal Transit Administration Appropriations . . . . . . . . . . . . . . . . . 16
Figure 6. Maritime Administration Appropriations . . . . . . . . . . . . . . . . . . . . . . . 18
List of Tables
Table 1. Status of Department of Transportation/Department of the
Treasury Appropriations for FY2004 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Table 2. Transportation/Treasury Appropriations, by Title,
FY2003-FY2004 (millions of dollars) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Table 3: Funding Trends for Transportation/Treasury Appropriations,
FY1999-FY2004 (billions of current dollars) . . . . . . . . . . . . . . . . . . . . . . . . 3
Table 4. Title I: Department of Transportation Appropriations . . . . . . . . . . . . . . 4
Table 5. FTA Appropriation, FY2003-FY2004 (millions of dollars) . . . . . . . . . 16
Table 6. Title II: Department of the Treasury Appropriations . . . . . . . . . . . . . . . 19
Table 7. Title III: United States Postal Service Appropriations . . . . . . . . . . . . . . 22
Table 8. Title IV: Executive Office of the President (EOP) and Funds
Appropriated to the President Appropriations . . . . . . . . . . . . . . . . . . . . . . . 25
Table 9. Title V: Related Agencies Appropriations . . . . . . . . . . . . . . . . . . . . . . . 32
Table 10. General Services Administration Appropriations . . . . . . . . . . . . . . . . 34

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Appropriations for FY2004: Transportation,
Treasury, Postal Service, Executive Office
of the President, General Government, and
Related Agencies
Most Recent Developments
On February 3, 2003, President Bush submitted his budget proposal for FY2004.
The proposed FY2004 budget for the Department of Transportation, Treasury, Postal
Service, Executive Office of the President, and Related Agencies is $85.9 billion,
$740 million below the comparable enacted figure for FY2003 (less than 1%).
Overview
Legislative Status
Table 1. Status of Department of Transportation/Department of
the Treasury Appropriations for FY2004
Conference
Subcommittee
Report
Markup
House
House
Senate
Senate
Conf.
Public
Report Passage
Report
Passage Report
Approval
Law
House
Senate
House Senate
Data note. Prior to FY2004, appropriations for the Department of
Transportation and the Department of the Treasury were in separate bills. Beginning
with the FY2004 budget, Congress is considering appropriations for the Department
of Transportation (DOT) and its related agencies, and the Department of the
Treasury, the Postal Service, the Executive Office of the President, and General
Government provisions, in a single appropriations bill. This change is a result of the
creation of a new federal department, the Department of Homeland Security, and the
reorganization of the subcommittee structure of the House and Senate Committees
on Appropriations, creating new subcommittees for Homeland Security and
combining the former Transportation and Treasury subcommittees into one
committee.
As part of the creation of the Department of Homeland Security (DHS), the
United States Coast Guard and the Transportation Security Administration were
transferred from the Department of Transportation to DHS. Also, the Bureau of

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CRS-2
Alcohol, Tobacco, and Firearms, the Customs Service, and the United States Secret
Service were transferred from the Department of the Treasury to DHS, and the Office
of Homeland Security was transferred from the Executive Office of the President to
DHS. Budget numbers for years prior to FY2004 have been adjusted to make
comparisons between previous appropriations and FY2004 requested funding.
FY2003 Appropriations
The FY2003 Consolidated Appropriations Resolution (P.L. 108-7) included a
0.65% across-the-board rescission which applied to most accounts in the Department
of Transportation and Department of the Treasury and General Government
appropriations. The FY2003 figures in this report reflect the rescission, and so differ
slightly from the figures in P.L. 108-7.
FY2004 Budget Request
The Administration’s FY2004 budget request for the Department of
Transportation, Department of the Treasury, Executive Office of the President, and
Related Agencies is $85.9 billion, $740 million below the final comparable FY2003
enacted figure (less than 1%). Table 3 shows the allocation of funding within the
overall request.
Table 2. Transportation/Treasury Appropriations, by Title,
FY2003-FY2004 (millions of dollars)
Final
FY2004
$ mil.
%
Title
FY2003
Request
+ or -
+ or -
Enacted a
Title I: Department of Transportation
55,690
54,266
-1,424
-2.6
Title II: Department of the Treasury
10,849
11,343
494
4.6
Title III: Postal Service
107
97
-10
-9.3
Title IV: Executive Office of the President
777
790
13
1.7
Title V: Related Agencies
19,151
19,556
405
2.1
Title VI: General Provisions
279
—
-279
-100
Total, Transportation/Treasury
Appropriations
86,604
85,864
-740
-0.9
Source: House Committee on Appropriations, Table: President’s Request with Outlays, FY2004, May
5, 2003.
a. Includes 0.65% across-the-board rescission.

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CRS-3
Major Funding Trends
Table 3: Funding Trends for Transportation/Treasury
Appropriations, FY1999-FY2004 (billions of current dollars)
FY2004
Admin.
Department
FY1999 FY2000 FY2001 d FY2002 FY2003 e
Request
Title I: Transportation a
43.9
46.2
51.9
57.4
55.7
54.3
Title II: Treasury b
9
9
9.9
10.5
10.8
11.3
Title III: Postal Service
0.1
0.1
0.1
0.7
0.1
0.1
Title IV: Executive
0.7
0.7
0.7
0.8
0.8
0.8
Office of the President
Title V: Related
14.6
15
15.8
16.8
19.2
19.6
Agencies c
Source: United States House of Representatives, Committee on Appropriations, Combined Statement
of Budget Authority tables from fiscal years 1999 through 2004.
a. Figures for Department of Transportation appropriations for FY1999-FY2003 have been adjusted
for comparison with FY2004 figures by subtracting the United States Coast Guard, the
Transportation Security Administration, the National Transportation Safety Board, and the
Architectural and Transportation Barriers Compliance Board, and by adding the Maritime
Administration.
b. Figures for Department of the Treasury appropriations for FY1999-FY2003 have been adjusted
for comparison with FY2004 figures by subtracting the Bureau of Alcohol, Tobacco, and
Firearms, the Customs Service, the United States Secret Service, and the Law Enforcement
Training Center.
c. Figures for Related Agencies appropriations for FY1999-FY2003 have been adjusted by adding
the National Transportation Safety Board and the Architectural and Transportation Barriers
Compliance Board.
d. FY2001 figures include 0.22% across-the-board rescission.
e. FY2003 figures include 0.65% across-the-board rescission.
Title I: Transportation Appropriations
Overview
The Administration’s FY2004 budget proposes a DOT budget of $54.3 billion
— 2.6% below FY2003's comparable enacted level of $55.7 billion.1 The budget
request conformed to the basic outline of both the Transportation Equity Act for the
21st Century (TEA-21; P.L. 105-178) which authorizes spending on highways and
1 This report relies on figures from tables provided by the House Committee on
Appropriations. Because of differing treatment of offsets, rescissions, and the structure of
appropriations bills, the totals will at times vary from those provided by the Administration.
The total FY2004 budget number for DOT is not directly comparable to those of previous
years due to the transfer of the Coast Guard and Transportation Security Administration to
the Department of Homeland Security during FY2003, as well as other changes.

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CRS-4
transit, and the aviation funding authorized in the Wendell Ford Aviation Investment
and Reform Act of the 21st Century (FAIR21 or AIR21; P.L. 106-181), although both
acts will have expired before the beginning of FY2004 (see Appendix 1 for more
information on these authorizing acts). However, the request did propose a few
changes to the highway and transit funding structure, in line with the
Administration’s reauthorization proposal; see the sections on the Federal Highway
Administration and Federal Transit Administration for details.
Table 4. Title I: Department of Transportation Appropriations
(in millions of dollars — totals may not add)
Final
Department or Agency
Request House
Senate
FY2004
FY2003
(Selected Accounts)
FY2004 FY2004 FY2004 Enacted
Enacted a
Office of the Secretary of
Transportation
172
177
Essential Air Service b
102
50
Federal Aviation Administration
13,510
14,007
Operations (trust fund &
general fund)
7,023
7,591
Facilities & Equipment
(F&E) (trust fund)
2,942
2,916
Grant-in-aid Airports (AIP)
(trust fund) (limit. on oblig.)
3,378
3,400
Research, Engineering &
Development (trust fund)
147
100
Federal Highway Administration
32,417
30,225
(Limitation on Obligations)
31,593
29,294
(Exempt Obligations)
893
931
Additional funds
(trust fund)
—
—
Additional funds c
(general fund)
187
—
Federal Motor Carrier Safety
Administration
313
447
National Highway Traffic Safety
Administration d
434
665
Federal Railroad Administration j
1,261
1,089
Amtrak e
1,043
900
Federal Transit Administration
7,179
7,226
Formula Grants
(general fund)
763
—
Formula Grants (trust fund)
3,051
5,615
Capital Investment Grants.
(general fund)
603
1,214
Capital Investment Grants
(trust fund)
2,413
321

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Final
Department or Agency
Request House
Senate
FY2004
FY2003
(Selected Accounts)
FY2004 FY2004 FY2004 Enacted
Enacted a
St.Lawrence Seaway
Development Corporation
14
14
Maritime Administration
230
219
Research and Special Programs
Administration f
105
118
Office of Inspector General
55
55
Surface Transportation Board
18
18
Total, Department of
Transportation) g
55,690
54,266
Note: Figures were taken from tables in House Committee on Appropriations reports. Because of
differing treatment of offsets, the totals will not always match the Administration’s totals. The figures
within this table may differ slightly from those in the text due to supplemental appropriations,
rescissions, and other funding actions. Columns may not add due to rounding or exclusion of smaller
program line-items.
a. These figures reflect the 0.65% across-the-board rescission included in P.L. 108-7.
b. In FY2003 Essential Air Service received an appropriation in addition to its authorized program
level.
c. For Appalachian Development Highway System ($187 million).
d. NHTSA’s FY2004 request includes $100 million transferred from FHWA; this funding was
previously provided through the FHWA but administered by NHTSA. Therefore, the
difference between budgetary resources available to NHTSA for FY2003 and its FY2004
request is $131 million, not $231 million.
e. In addition to Amtrak’s FY2003 appropriation, Congress postponed Amtrak’s repayment of a $100
million loan from the DOT.
f. The figures do not reflect $14 million in permanent appropriations. Therefore, the total resources
for RSPA for FY2003 may be seen as $119 million.
g. Rescissions of unobligated previous years’ contract authority have been subtracted from this total.
Because rescissions of prior years’ contract authority have no impact on the budgetary resources
available for the current fiscal year, the total resources available could be seen as $55.9 billion
for FY2003 enacted.
Federal Aviation Administration (FAA)
[http://www.faa.gov/]
The Bush Administration is requesting FAA funding of slightly more than $14
billion for FY2004. This represents an almost $500 million increase over the
FY2003 enacted level of $13.5 billion (this amount reflects a 0.65% rescission to
which some parts of the FAA budget were subjected). Almost all of the increased
funding requested in the FY2004 budget submission would be used for Operations
& Maintenance (O&M) expenses. With the exception of some program adjustments
there are essentially no major new initiatives in the FY2004 proposal.

---

CRS-6
Figure 1. Federal Aviation Administration Appropriations
The appropriations debate for FY2003 lasted well into the fiscal year and was
only settled by passage of the Consolidated Appropriations Resolution (P.L. 108-7).
Although the Resolution itself was controversial, FAA funding was not part of the
controversy. In fact, the finally agreed upon FY2003 funding level closely tracked
the levels provided for in House and Senate versions of the legislation. The
Resolution did make some changes in existing FAA programs, however, most of
these were minor. The Resolution also consolidated various earmarks from Senate
and House bills.
The vast majority of FAA funding is provided from the Airport and Airway
Trust Fund. Only O&M funding uses a mix of trust fund and Treasury general fund
monies. In FY2002 a Treasury general fund contribution of $1.1 billion was
provided for O&M funding. The Administration proposed a general fund
contribution of almost $3.3 billion for FY2003. Whereas the general fund
contribution for FY2002 was on the low side historically, the Administration was
trying to return to a higher contribution level. In this effort they were successful,
with both the House and the Senate agreeing ultimately on $3.4 billion. Historically,
this funding split has been an important part of the annual FAA budget debate. The

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CRS-7
rationale behind the general fund contribution has been that the public at large
realizes some benefit from aviation whether it uses the system or not.2
Operations and Maintenance (O&M). The Administration is proposing
to spend almost $7.6 billion on O&M in FY2004 as compared with the not quite $7.1
billion level agreed to in P.L. 108-7. The majority of funding in this category is for
the salaries of FAA personnel engaged in air traffic control, certification, and safety
related activities. Much of the increased funding called for in the FY2004 request is
for additional air traffic controllers and other safety related staff.
Facilities and Equipment (F&E). P.L. 108-7 provides $2.96 billion for this
activity. The FY2004 request is essentially unchanged from this level. F&E funding
is used primarily for capital investment in air traffic control and safety. There are no
significant new F&E spending initiatives in the Administration proposal.
Research, Engineering, and Development (RE&D). The Administration
is suggesting a funding level of $100 million for RE&D in FY2004, well below the
$148.5 million enacted in FY2003.
Essential Air Service (EAS). The EAS program is operated through the
Office of the Secretary of Transportation (OST), and receives its funding from
designated user fees collected from overflights of United States territory by foreign
aircraft. EAS has had an annual authorized funding level of $50 million for the last
several years. The overflight funding mechanism, however, has never provided this
much annual funding, so additional funding has been provided from other sources.
The EAS program continues to enjoy significant support in Congress. As a result,
$102 million was provided for this program in FY2003.
For FY2004 the Bush Administration is proposing $50 million in spending for
the program. Of this, $33 million is to come from overflight fees and the remaining
$17 million is to be provided by unspent prior year funding. In addition, the
Administration is proposing major changes in the operation of the EAS program by
requiring greater local financial support for EAS service and by changing the
eligibility of certain communities based on their proximity to airports with non-EAS
service.
Grants-in-Aid for Airports. The Airport Improvement Program (AIP)
provides grants for airport development and planning. The Bush Administration
FY2004 budget requests $3.4 billion for AIP, roughly the same as enacted for
FY2003. The budget request provides for up to $69.7 million of these funds to be
obligated for administration and $7.4 million for technology research.
AIP’s existing authorization expires at the end of FY2003. The Bush
Administration, as part of its FAA reauthorization proposal for FY2004-FY2007,
2 General fund appropriations have varied substantially, both in dollar terms and as a
percentage of FAA appropriations as a whole, from year to year. Over the last 12 years the
share has ranged from 0% to 47%. See table 1 in CRS Report RS20177, Airport and Airway
Trust Fund Issues in the 106th Congress, by John W. Fischer.

---

CRS-8
would hold AIP’s annual funding at the $3.4 billion level for the life of the
authorization. It would also restructure AIP to increase the program’s discretionary
funding from 34% to 46% of total program funding. This would require less
generous funding of the popular airport “entitlements” which are distributed by
formula.
Federal Highway Administration (FHWA)
[http://www.fhwa.dot.gov]
The FHWA budget provides funding for the Federal-Aid Highway Program
(FAHP), which is the umbrella term for nearly all the highway programs of the
agency. For FY2004, the President requests $30.2 billion for FHWA. This
represents a decrease of $2.2 billion (-7%) from the FY2003 appropriation of $32.4
billion. The proposed obligation limitation, which supports most of the FAHP, is set
at $29.3 billion and is significantly less than the $31.6 billion enacted for FY2003.
Funding for exempt programs (emergency relief and a portion of minimum guarantee
funding) is set at $931 million, up $38 million from FY2003's $893 million.
Figure 2. Federal Highway Administration Appropriations
The budget continues FHWA’s major programs but also proposes some
changes, which reflect the Administration’s reauthorization proposal. A new $1.0
billion Infrastructure Performance and Maintenance initiative is one of the proposed
changes. The program’s funds would be distributed, according to the Surface
Transportation Program formula, for use on “ready-to-go” projects that address

---

CRS-9
congestion and improve infrastructure conditions. States would have to commit
these funds during the first six months of the fiscal year. Funds not obligated within
this time frame would be reallocated among the states.
On the revenue side, the budget proposes the redirection of revenues from the
2.5 cents-per-gallon excise tax on gasohol, that are now deposited in the Treasury’s
general fund, to the highway trust fund. This change is expected to add roughly $600
million to highway trust fund revenues in FY2004. This change would require
legislation in addition to the appropriations bill. The budget assumes no revenue
aligned budget authority (RABA) adjustments for FY2004.
The TEA-21 Funding Framework. Authorizing legislation for surface
transportation programs, the Transportation Equity Act for the 21st Century (TEA-21)
expires at the end of FY2003. The new authorization is expected to at least retain a
large part of the existing program funding framework. TEA-21 created the largest
surface transportation program in U.S. history. For the most part, however, it did not
create new programs. Rather, it continued most of the highway and transit programs
that originated in its immediate predecessor legislation, the Intermodal Surface
Transportation Efficiency Act of 1991 (ISTEA, P.L. 102-240).
There are several groupings of highway programs within the highway program.
Most of the funding is reserved for the major federal aid highway programs, which
can be thought of as the core programs. These programs are: National Highway
System (NHS), Interstate Maintenance (IM), Surface Transportation Program (STP),
Bridge Replacement and Rehabilitation (BRR), and Congestion Mitigation and Air
Quality Improvement (CMAQ). All of these programs are subject to apportionment
on an annual basis by formula and are not subject to program-by-program
appropriation.
There is a second category of highway funding. This so called “exempt”
category consists of two elements: an additional annual authorization of minimum
guarantee funding ($639 million per fiscal year) and emergency relief ($100 million
per fiscal year). These funds are not subject to the annual limitation on obligations.
There are a further set of programs, known as the “allocated” programs. These
programs are under the direct control of FHWA or other governmental entities.
These programs include: the Federal Lands Highway Program, High Priority Projects
(former demonstration project category), Appalachian Development Highway System
roads, the National Corridor Planning and Border Infrastructure Program, and several
other small programs.

---

CRS-10
Federal Motor Carrier Safety Administration (FMCSA)
[http://www.fmcsa.dot.gov/]
The FMCSA was created by the Motor Carrier Safety Improvement Act of 1999
(MCSIA), P.L. 106-159.3 This agency became operational on January 1, 2000, and
assumed the responsibilities and personnel of DOT’s Office of Motor Carrier Safety.4
FMCSA issues and enforces the federal motor carrier safety regulations, which
govern the operation and maintenance of interstate commercial truck and bus
operations and specify requirements for commercial drivers. FMCSA also
administers several grants and programs to help states conduct various truck and bus
safety activities. Together with the states, FMCSA conducts inspections of Mexican-
domiciled commercial drivers and vehicles entering the United States, advances
Intelligent Transportation Systems for commercial operations, and reviews carriers
transporting high hazard materials. Most of the funds used to conduct FMCSA
activities are derived from the federal highway trust fund.
The FY2004 Administration request for the FMCSA is $447 million. This is an
increase of almost $134 million (43%) over the FY2003 appropriation of $313.1
million. The FMCSA appropriation consists of two primary components: FMCSA
administrative and operations expenses; and financial assistance to the states for the
conduct of various truck and bus safety programs, including state border enforcement
activities.
Administrative and Operations Expenses. The President’s budget
request for FMCSA’s administrative and operations expenses in FY2004 is $224
million (up from $124 million in FY03), including funds for research and technology
(R&T) and regulatory development. Some of the activities that would be funded
include: enforcement to reduce the number of unsafe carriers and drivers; outreach
efforts to help educate the motoring public on how to share the road with commercial
vehicles; and the establishment of a medical review board to assist FMCSA.
Grants to States and Other Activities. The Administration’s FY2004
request for these activities is $223 million. These funds are used primarily to pay for
the Motor Carrier Safety Assistance Program (MCSAP), which provides grants to
states to help them enforce commercial vehicle safety and hazardous materials
transportation regulations. MCSAP grants cover up to 80% of the costs of a state’s
truck and bus safety program. Some 10,000 state and local public-utility and law-
enforcement officers conduct more than 2.6 million roadside inspections of trucks
and buses annually under the program.
3 During various hearings held in the first session of the 106th Congress, a number of
organizations, including DOT’s Inspector General, the General Accounting Office, and
many industry associations raised a variety of concerns regarding the effectiveness of the
federal truck and bus safety program. In response to these concerns, Congress created the
FMCSA.
4 DOT’s Office of Motor Carrier Safety, which operated from October 9 through December
31, 1999, replaced the Office of Motor Carriers of the Federal Highway Administration of
the DOT.

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CRS-11
National Highway Traffic Safety Administration (NHTSA)
[http://www.nhtsa.dot.gov/]
The National Highway Traffic Safety Administration (NHTSA) supports
behavioral (primarily driver and pedestrian actions) and vehicle (primarily crash
worthiness and avoidance) programs that are intended to improve traffic safety.
More specifically, NHTSA seeks to reduce impaired driving, increase occupant
protection, improve police traffic services, enhance emergency medical responses to
crashes, ensure compliance with its various vehicle safety regulations, and track and
deal with emerging vehicle safety problems. NHTSA also provides grants to the
states for the implementation of various highway traffic safety programs.
Figure 3. National Highway Traffic Safety Administration
Appropriations
For FY2004, the Administration requests $665 million to carry out its mission.
The request reflects an increase of $6 million above the FY 2003 program level, and
the addition of funding previously allocated to safety belt use and impaired-driving

---

CRS-12
law incentive programs under the Federal Highway Administration.5 Of the total
amount requested for FY2004, $447 million is designated to support traffic safety
incentive and performance grants to states, primarily to encourage occupant
protection measures and reduce impaired driving. The FY2004 request also includes
$218 million for NHTSA’s own operations and research activities to reduce highway
fatalities and prevent injuries. The request includes funding for the following four
major areas: research and analysis (e.g., collection of crash statistics and research on
vehicle performance and occupant damage during these crashes), highway safety
programs (e.g., developing improved countermeasures to combat impaired driving),
safety assurance (e.g., testing of vehicles to ensure compliance with federal motor
vehicle safety standards and maintaining a legislatively required database to track
vehicle defects), and safety performance standards (e.g, conducting crash avoidance
and crashworthiness testing, and evaluating child safety seats).
Federal Railroad Administration (FRA)
[http://www.fra.dot.gov]
For FY2004, the Administration requested $1.09 billion in funding for the FRA.
Most of this amount is for Amtrak. The Administration requested $900 million for
Amtrak, $150 million less than provided in FY2003 and $379 million more than the
President requested in FY2003. Of the $900 million requested, $671 million is for
operating costs and $229 million is for infrastructure costs.
The Administration requested $131 million for railroad safety and operations,
which is $14 million more than provided in FY2003 and $13 million more than the
President requested for FY2003. For railroad research and development, the
President requested $35 million, which is $6 million more than funding for FY2003.
For next generation high-speed rail, the President requested $23 million, $7 million
less than last year.
Although most of the debate involving the FRA budget centers on Amtrak,
agency safety activities (which receive more detailed treatment following this
section), Next Generation High-Speed Rail, and how states might obtain additional
funds for high-speed rail initiatives are also issues.
5 http://www.dot.gov/bib2004/nhtsa.html. According to DOT, total funds requested for
NHTSA for FY2004: “Includes $222 million of TEA-21 resources for the Sections 157 and
163 grant programs formerly appropriated to FHWA. NHTSA has always administered
these funds; therefore, the budget proposes that the funding be appropriated directly to
NHTSA.”

---

CRS-13
Figure 4. Federal Railroad Administration Appropriations
Railroad Safety and Research and Development. The FRA is the
primary federal agency that promotes and regulates railroad safety. Increased
railroad traffic volume and density make equipment, employees, and operations more
vulnerable to adverse safety impacts. The Administration proposes $131 million in
FY2004 for FRA’s safety program and related administrative and operating activities.
Most of the funds are used to pay for salaries as well as associated travel and training
expenses for FRA’s field and headquarters staff and to pay for information systems
monitoring the safety performance of the rail industry.6 The funds requested support
FRA’s goals of reducing rail accidents and incidents, reducing grade-crossing
accidents, and contributing to the avoidance of serious hazardous materials incidents.
The Administration’s request for FY2004 represents about a 13% increase over the
$116.6 million provided in the FY2003 DOT appropriations for rail safety and
operations.
6 The funds also are used to conduct a variety of initiatives, including the Safety Assurance
and Compliance Program (SACP), the Railroad Safety Advisory Committee (RSAC), and
field inspections. SACP involves numerous partnerships forged by railroad management,
FRA personnel, and labor to improve safety and compliance with federal railroad safety
regulations. RSAC uses a consensus-based process involving hundreds of experts who work
together to formulate recommendations on new or revised safety regulations for FRA’s
consideration.

---

CRS-14
The railroad safety statute was last reauthorized in 1994. Funding authority for
the program expired at the end of FY1998. FRA’s safety program continues using the
authorities specified in existing federal railroad safety law and funds provided by
annual appropriations. Though hearings have been held since 1994, the deliberations
have not resulted in agreement on funding for FRA’s regulatory and safety
compliance activities or change to any of the existing authorities used by FRA to
promote railroad safety. A reauthorization statute changing the scope and nature of
FRA’s safety activities would most likely affect budgets after FY2004.
To improve its safety regulations and industry practices, the FRA conducts
research and development (R&D) on an array of topics, including railroad employee
fatigue, technologies to control train movements, and track dynamics. In reports
accompanying House and Senate transportation appropriation bills and in annual
conference reports, the appropriations committees historically have allocated FRA’s
R&D funds among various research categories pertaining to safety. The FY2003
DOT appropriation provided $29.1 million for the R&D program. For FY2004, the
Administration requests $35 million for these activities.
Next Generation High-Speed Rail R&D. This program supports work on
high-speed train control systems, track and structures technology, corridor planning,
grade crossing hazard mitigation, and high-speed non-electric locomotives. The
Administration requested $23.2 for this program in FY2004; this is $7.05 million
(23%) less than the FY2003 appropriation of $30.25 million.
Amtrak
[http://www.amtrak.com]
The President requested $900 million for Amtrak for FY2004; this is $150
million below Amtrak’s FY2003 appropriation of $1,050 million7 and $900 million
less than the $1.8 billion Amtrak has requested for FY2004.
In a change of policy, Congress stipulated (in P.L. 108-7) that Amtrak’s FY2003
appropriation would not go directly to the corporation, but to the Secretary of
Transportation, who will provide funding to Amtrak quarterly through the grant-
making process. Congress also imposed several other requirements on Amtrak which
have the effect of reducing Amtrak’s discretion with its federal funding. Among
these was a requirement that Amtrak submit a 5-year business plan to Congress,
which it did on April 25, 2003. In this plan, Amtrak requests average annual federal
support of $1.6 billion for FY2004-FY2008 to maintain the current network and
begin to address the $5-6 billion in backlogged maintenance needs.
Amtrak’s authorization expired at the end of FY2002; Congress may consider
Amtrak reauthorization during the 108th Congress. In June 2002 the Administration
presented its principles for Amtrak reform; in April 2003 they presented an outline
7 For FY2003, Congress also deferred Amtrak’s repayment of a $100 million loan to the
DOT.

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CRS-15
of a plan for restructuring Amtrak and passenger rail service. See CRS Report
RL31743, Amtrak Issues in the 108th Congress, for further information.
Federal Transit Administration (FTA)
[http://www.fta.dot.gov/]
President Bush’s FY2004 budget request for FTA is $7.226 billion, virtually the
same level as FTA’s FY2003 appropriation (FTA’s FY2003 $7.226 billion final
appropriation was reduced to $7.179 billion after the 0.65% rescission).8 The
Administration’s request also proposes some changes to FTA’s program structure,
reflecting the Administration’s reauthorization proposal. Table 5 presents the
Administration request in the existing program structure. The proposed program
changes include the following:
Restructuring the Capital Investment Grants and Loans Program.
This program consists of three component programs: New Starts, the Fixed
Guideway Modernization formula program, and the Bus and Bus Facilities
discretionary grant program. The Administration request renames the Capital
Investment Grants and Loans Program “Major Capital Investment Grants,” eliminates
the Bus and Bus Facilities program, groups the Fixed Guideway Modernization
program with other formula programs, and groups funding for metropolitan and
statewide planning under this newly renamed program. Thus, after these changes the
program’s funding would support only New Starts and a portion of metropolitan and
statewide planning spending. In addition, the budget proposes that 80% of the
funding for the “Major Capital Investment Grants” program would come from
General Fund appropriations and 20% from the Mass Transit Account of the
Highway Trust Fund; currently, 80% of the funding for the Capital Investment Grants
and Loans Program comes from the Mass Transit Account, and 20% from General
Fund appropriations.
Eliminating the Bus & Bus Facilities Program. The Administration
requests no funding for this program; funds previously allocated to this discretionary
program ($607 million in FY2003) are proposed to be divided among the Urbanized
Areas Formula Program, the Non-Urbanized Areas Formula Program, and the New
Starts program, in accordance with the Administration’s reauthorization proposal.
Buses can be purchased under all three of these programs. The Bus and Bus
Facilities Program is a discretionary grant program and was completely earmarked
in FY2003. The Administration’s proposal would eliminate bus earmarks and
distribute bus and bus facilities funds through two formula programs and the New
Starts program.
8 These figures for FTA do not include any projections to account for possible flexible
funding transfers from FHWA to FTA. In FY2002 such transfers amounted to $1.1 billion.

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CRS-16
Figure 5. Federal Transit Administration Appropriations
Proposed New Freedom Initiative. The Administration’s request proposes
to create a new formula program, the New Freedom Initiative, which seeks to use
alternative methods to promote access to transportation for persons with disabilities
(this program was also proposed in FY2003, but was not supported by Congress).
The President’s budget requests $145 million for this program in FY2004.
For information on FTA’s programs and funding structure, see CRS Report
RL31854, Transit Program Reauthorization in the 108th Congress.
Table 5. FTA Appropriation, FY2003-FY2004 (millions of dollars)
FY2003
FY2004
FY2004
FY2004
FY2004
Program
Enacted
Request
House
Senate
Conference
Urbanized Areas Formula Program
(Section 5307)
3,407
3,521
Capital Investment Grants & Loans
Program (Section 5309) Total
3,016
2,729
New Starts Program
1,207
1,515
Fixed Guideway
Modernization Program
1,207
1,214
Bus Discretionary Program
603
—

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CRS-17
FY2003
FY2004
FY2004
FY2004
FY2004
Program
Enacted
Request
House
Senate
Conference
Non-Urbanized Areas Formula
Program (Section 5311)
237
359
Job Access & Reverse Commute
Program
149
150
Elderly & Individuals with
Disabilities Formula Program
(Section 5310)
90
87
Rural Transportation Accessibility
Incentive Program (Section 3038),
also known as the Over-the-Road
Bus Accessibility program
7
7
Planning
73
70
Research
55
50
Other
145
108
New Freedom Initiative
—
145
FTA Total
7,179
7,226
Note: numbers may not add due to rounding.
Source: The Budget of the United States Government, Fiscal Year 2004, Appendix: “Federal Transit
Administration,” p. 740-747, adjusted by CRS to reflect the 0.65% across-the-board rescission, with
reference to House Committee on Appropriations, Table: President’s Request with Outlays, FY2004.
Maritime Administration (MARAD)
[http://www.marad.dot.gov]
MARAD’s mission is to promote the development and maintenance of a U.S.
merchant marine capable of carrying the Nation’s waterborne domestic commerce,
a portion of its waterborne foreign commerce, and to serve as a naval and military
auxiliary in time of war. MARAD administers programs that benefit U.S. vessel
owners, shipyards, and ship crews. For FY2004, the President requested a total of
$219 million for MARAD, which is about $12 million more than the President
requested, and about $11 million less than Congress appropriated, for FY2003.
Much of the discussion concerning MARAD’s budget focuses on the Maritime
Guaranteed Loan Program (the “Title XI” program). This program provides
guaranteed loans for purchasing ships from U.S. shipyards and for the modernization
of U.S. shipyards. The purpose of the program is to promote the growth and
modernization of U.S. shipyards. Consistent with its budget requests in prior years,
the Administration has requested no funds for additional loans in FY2004, calling the
program a “corporate subsidy.” The Administration has, however, requested $4.5
million for the administration of existing loans. For FY2003, in the Consolidated
Appropriations Resolution (P.L. 108-7), Congress initially provided no funds for the
program other than $4 million for administrative expenses. However, in the
Supplemental Appropriations bill (P.L. 108-11), Congress provided $25 million for
the program. The DOT Inspector General has recently issued a report on the Title XI
program (report no. CR-2003-031, March 27, 2003) calling on MARAD to review
loan applications more effectively, exercise more rigorous financial oversight of

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CRS-18
borrowers, and use an external financial advisor in reviewing loan applications. The
IG’s investigation was prompted by the bankruptcy of American Classic Voyages,
leaving MARAD with $367 million in bad loans for the construction of two cruise
ships.
Figure 6. Maritime Administration Appropriations
For operations and training, the Administration is requesting $104.4 million
which is about $12 million more than Congress appropriated in FY2003. Of this
amount, $52.9 million is requested for the U.S. Merchant Marine Academy in Kings
Point, New York; $9.5 million for state maritime academies; and $42 million for the
operations of MARAD. For the Maritime Security Program (MSP), the
Administration is requesting $98.7 million which is virtually the same amount as
Congress provided last year. MSP is a fleet of 47 privately-owned U.S. flag
commercial vessels engaged in international trade that are available to support the
Department of Defense in a national emergency. For the disposal of obsolete vessels
in the National Defense Reserve Fleet (NDRF), the Administration is requesting
$11.4 million which is about the same amount as Congress appropriated in FY2003.
There are over 130 vessels in the NDRF that are awaiting disposal because of their
age. MARAD has until 2006 to dispose of these surplus ships. Most of the ships are
located on the James River in Virginia and in Suisan Bay, California.

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CRS-19
Research and Special Programs Administration (RSPA)
[http://www.rspa.dot.gov]
The Research and Special Programs Administration (RSPA) includes a variety
of operating entities, including Office of Pipeline Safety and the Office of Hazardous
Materials Safety. RSPA also conducts a multimodal research program, helps
coordinate and plan for transportation research and technology transfer activities,
sponsors educational activities to promote innovative transportation, and manages
DOT’s transportation-related emergency response and recovery responsibilities. For
FY2004, the Administration requests a budget of $132 million for RSPA. Most of
this funding would be allocated to activities that promote transportation safety. For
RSPA’s pipeline transportation safety program, $67 million is proposed, an increase
of $3 million over the FY2003 appropriation. For its hazardous materials
transportation safety program, $25 million is requested, an increase of $2 million
over the FY2003 appropriation. Much of the additional funding requested is
intended to enhance RSPA’s ability to ensure that the federal hazardous materials
transportation pipeline safety regulations are complied with and to assist DOT in
participating in the safety oversight of containment systems that will be used to ship
spent nuclear fuel and high-level radioactive wastes.
Title II: Treasury Appropriations
Table 6. Title II: Department of the Treasury Appropriations
(in millions of dollars)
FY2003
FY2004
FY2004
FY2004
FY2004
Program or Account
Enacted
Request
House
Senate
Enacted
Departmental Offices
158
167
Department-wide Systems and
Capital Investments
37
37
Inspector General
135
135
Air Transportation Stabilization
Program
6
3
Treasury Building Repair and
Restoration
29
25
Financial Crimes Enforcement
Network
51
58
Interagency Crime and Drug
Enforcement
107
—
Financial Management Service
221
229
Bureau of the Public Debt
189
174
Internal Revenue Service, Total
9,835
10,437
Processing, Assistance
and Management
3,930
4,075
Tax Law Enforcement
3,705
3,977

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CRS-20
FY2003
FY2004
FY2004
FY2004
FY2004
Program or Account
Enacted
Request
House
Senate
Enacted
Earned Income Tax
Credit Compliance
Initiative
145
251
Information Systems
1,622
1,670
Business Systems
Modernization
364
429
Health Insurance Tax
Credit Administration
70
35
Total,
Department of the Treasury
10,840
11,343
Department of the Treasury Budget and Key Policy Issues
In recent decades, the Department of the Treasury has performed four basic
functions: (1) formulating, recommending, and implementing economic, financial,
tax, and fiscal policies; (2) serving as the financial agent for the federal government;
(3) enforcing federal financial, tax, counterfeiting, customs, tobacco, alcoholic
beverage, and gun laws; and (4) producing postage stamps, currency, and coinage.
With the creation of the Department of Homeland Security late in 2002 and its
assumption in March 2003 of operational control of the authorities transferred to it
by executive order, this functional profile has changed somewhat. Treasury still
serves as the federal government’s main economic policymaker, financial manager,
revenue collector, and producer of currency, coinage, and stamps; but its role in law
enforcement is now much more limited.
At its most basic level of organization, the department consists of departmental
offices and operating bureaus. The departmental offices are responsible for the
formulation and implementation of policy and the management of the department as
a whole, while the operating bureaus carry out specific duties assigned to the
department. The bureaus typically account for more than 95% of Treasury
Department employment and funding. With one notable exception, the bureaus can
be separated into those having financial responsibilities and those engaged in law
enforcement. In recent decades, financial responsibilities have been handled by the
Comptroller of the Currency, U.S. Mint, Bureau of Engraving and Printing, Financial
Management Service, Bureau of Public Debt, Community Development Financial
Institutions Fund, and Office of Thrift Supervision; and law enforcement has been
done by the Bureau of Alcohol, Tobacco, and Firearms (BATF), U.S. Secret Service,
Federal Law Enforcement Training Center, U.S. Customs Service, Financial Crimes
Enforcement Network (FinCen), and Treasury Forfeiture Fund. The sole exception
to this dichotomy is the Internal Revenue Service (IRS), which performs both
financial functions and law enforcement through its administration of federal tax
laws.
The advent of DHS has greatly diminished the department’s law-enforcement
functions. Under the law establishing the new department (P.L. 107-296), the Secret
Service, Customs Service, and Federal Law Enforcement Training Center are being

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CRS-21
transferred from the Treasury Department to DHS, while the Treasury Forfeiture
Fund and many functions of BATF are being transferred to the Justice Department
(DOJ). On January 24, 2003, the Treasury Department announced the establishment
of a new bureau to administer laws related to the use of alcohol and tobacco and to
implement regulations which formerly were handled by BATF: the Alcohol and
Tobacco Tax and Trade Bureau. Its functions include collecting alcohol and tobacco
excise taxes and classifying those products for tax purposes.
In its budget request for FY2004, the Bush Administration proposes to increase
the Treasury Department’s budget by 3.5% over the amount enacted for FY 2003,
after adjusting for the transfer of functions to DHS and the Justice Department. If the
request is enacted without change, funding for Treasury accounts would total $11.408
billion in FY2004, up from $11.018 billion in FY 2003.9 According to budget
documents, the Administration’s top priorities for Treasury operations in the coming
fiscal year are to bolster IRS’s efforts to monitor and enforce compliance with tax
laws, increase the Department’s efficiency by further streamlining operations, and
continue to play a central role in the efforts to combat money laundering and thwart
financial networks supporting international terrorist activities. Under the newly
configured Treasury accounts, the IRS accounts for 91.5% of the proposed Treasury
budget, followed by the Financial Management Service (2.0%), the Bureau of Public
Debt (1.6%), and Departmental Offices (1.5%).
The budget request also calls for an increase of $7 million in funding for FinCen
and an additional $4 million for the Department’s International Technical Assistance
program, which focuses on helping countries seeking to rebuild after conflicts to
improve their systems of economic governance. In addition, the Administration is
proposing that the Department’s Inspector General for Tax Administration be merged
with the Department’s Inspector General (IG), since many of the IG’s functions have
been transferred to other agencies, especially DHS.
Internal Revenue Service (IRS).
T h e f e d e r a l go v e r n m e n t l e v i e s
individual and corporate income taxes, social insurance taxes, excise taxes, estate and
gift taxes, customs duties and miscellaneous taxes and fees. The federal agency
responsible for administering all these taxes and fees, except customs duties, is the
IRS. In discharging that duty, it receives and processes tax returns and other related
documents, processes payments and refunds, enforces compliance through audits and
other methods, collects delinquent taxes, and provides a variety of services to
taxpayers to help them understand their rights and responsibilities and resolve
problems. In FY 2002, the most recent year for which data are available, the IRS
collected $2,017 billion before refunds, the largest component of which was
individual income tax revenue of $1,038 billion.
9 There is a discrepancy of $65 million between the Administration’s budget request for the
Treasury Department in FY2004 and the amount being considered by the appropriations
committees. This difference represents funding for two programs which are administered
by Treasury but funded through separate appropriations accounts: the Community
Development Financial Institutions Fund (CDFI) and international technical assistance. The
former is covered under the appropriations for the Department of Housing and Urban
Development and the latter under the appropriations for foreign operations.

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CRS-22
The Bush Administration is asking Congress for $10.436 billion to fund IRS
operations in FY2004. This amount is 6.1% greater than the $9.834 billion enacted
for FY 2003 and 5.2% greater than the amount requested by the Administration for
FY 2003. Of the requested budget for FY2004, $4.135 billion would be used for
processing, assistance, and management; $4.086 billion for tax law enforcement;
$1.709 billion for information systems; $500 million for PRIME; $251 million for
a program aimed at curbing fraud and abuse in claims for the earned income tax
credit; and $2 million to pay for the cost of using private debt collectors to collect
past-due taxes.
The proposed budget places a high priority on improving individual and
business compliance with tax laws. It would set aside $133 million for a new
program aimed at stemming five sources of tax evasion: (1) the promotion of
abusive tax schemes; (2) the misuse of trusts and offshore accounts to hide or
illegally lower taxable income; (3) the use of abusive corporate tax avoidance
schemes; (4) the under-reporting of income by upper-income individuals; and (5) the
failure of employers to file employment tax returns and pay substantial amounts of
employment taxes in a timely manner. The Administration hopes such a program
will lead to a 72% increase in the number of audits of tax returns for high-income
individuals and businesses. Nonetheless, both former IRS Commissioner Charles
Rossotti and the IRS Oversight Board have expressed the concern in recent months
that funding IRS operations at levels similar to what the Administration is requesting
would fall far short of what is required to enable the IRS to enforce the tax laws
adequately.10
Title III: Postal Service
Table 7. Title III: United States Postal Service Appropriations
(in millions of dollars)
FY2003
FY2004
FY2004
FY2004
FY2004
Program or Account
Enacted
Request
House
Senate
Enacted
Payment to the Postal Service
Fund
29
29
Advance Appropriation,
FY2002/2003
47
31
Advance Appropriation, FY2004
31
37
Total, Postal Service
107
97
Source: United States House of Representative, Committee on Appropriations, Table: President’s
Request with Outlays, FY2004.
The U.S. Postal Service (USPS) generates nearly all of its funding — about $70
billion annually — through the sale of products and services. It does receive a
regular appropriation from Congress, however, to compensate for revenue it forgoes
10 Alison Bennett, “Rossotti Details IRS Successes, Notes Much Work Remains for Years
Ahead,” Daily Report for Executives, Bureau of National Affairs, no. 210, Oct. 30, 2002,
p. G-6; and George Guttman, “Oversight Board Concerned About IRS Budget Situation,”
Tax Notes, vol. 97, no. 11, pp. 1404-1406.

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CRS-23
in providing, at congressional direction, free mailing privileges for the blind and
visually impaired and for overseas voting. Under the Revenue Forgone Reform Act
of 1993, Congress is required to reimburse USPS $29 million each year until 2035,
for services performed but not paid for in the 1990s (for more information, see CRS
Report RS21025, The Postal Revenue Forgone Appropriation: Overview and
Current Issues). The terrorist attacks in the fall of 2001, however, including use of
the mail for delivery of anthrax spores to congressional and media offices, generated
new funding needs that USPS contends should be met through appropriations.
In FY2003, USPS received a revenue forgone appropriation of $59.6 million,
including $30.8 million for revenue forgone in FY2003 but not payable until October
1, 2003, and the $29 million ($28.8 after rescission) due annually under the Revenue
Forgone Reform Act of 1993.
In its FY2004 Budget, the Administration proposed an appropriation of $55.7
million for revenue forgone in fiscal 2004, and $29 million for the FY2003
installment under the Revenue Forgone Reform Act of 1993 — reduced by $19.2
million as a reconciliation adjustment to reflect actual versus estimated free mail
volume in 2001 — for a total of $65.5 million. Of this amount, $36.5 million would
not be available for obligation until October 1, 2004, which is in FY2005. However,
USPS will also have available for obligation during FY2004 the $31 million
provided for revenue forgone in fiscal 2002, for a total of $60 million. In its FY2002
Budget, the Bush Administration had proposed to “reverse the misleading budget
practice of using advance appropriations simply to avoid [annual] spending
limitations.” The Administration did not renew the proposal in its FY2003 or
FY2004 Budgets.
In its detailed justification of its FY2004 budget request, USPS asked Congress
for an additional $350 million (above the OMB proposal of $65.5 million) in
emergency response funds to protect the safety of employees and customers from
threats such as the 2001 anthrax attack. The funds would be used to continue
acquisition and deployment of ventilation and filtration equipment that was begun
with $762 million provided in FY2002 specifically for emergency response. Neither
the Administration’s FY2003 Budget nor its FY2004 Budget included any additional
funds for emergency preparedness for the Postal Service. As a condition to receiving
the largest part of its previous emergency response funding, on March 6, 2002 USPS
submitted to its oversight and appropriations committees an emergency preparedness
plan to combat the threat of biological and chemical substances in the mail.11 The
March 6, 2002 emergency preparedness plan did identify substantial needed
appropriations of $799.8 million for FY2003, and $897.5 million for FY2004.
The Administration’s Budget also contained a proposal to correct an anticipated
over-funding of USPS obligations for the retirement benefits of postal workers under
the Civil Service Retirement System. Congress has passed legislation (P.L. 108-18)
to reduce the annual USPS contribution to the Civil Service Retirement and
Disability Fund, which will have the effect of saving USPS $2.9 billion in FY2003
and $2.6 billion in succeeding years. For more on this legislation, see CRS Report
11 See [http://www.usps.com/news/2002/press/pr02_pmg0313.htm ], visited April 14, 2003.

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CRS-24
RL31684, Funding Postal Service Obligations to the Civil Service Retirement
System.

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CRS-25
Title IV: Executive Office of the President (EOP) and
Funds Appropriated to the President
Table 8. Title IV: Executive Office of the President (EOP) and
Funds Appropriated to the President Appropriations
(in millions of dollars)
FY2003
FY2004
FY2004
FY2004
FY2004
Office
Enacted
Request
House
Senate
Enacted
Compensation of the President
0.45
—
The White House Office
(salaries and expenses)
50
—
Office of Homeland Security
19
—
Executive Residence at the
White House (operating
expenses)
12
—
White House Repair and
Restoration
1
—
Office of the Vice President
(salaries and expenses)
4
—
Official Residence of the Vice
President (operating expenses)
0.32
—
Council of Economic Advisors
4
—
Office of Policy Development
3
—
National Security Council
8
—
Office of Administration
91
—
The White House
—
184
Office of Management and
Budget
62
77
Office of National Drug Control
Policy (salaries and expenses)
26
27
Office of National Drug Control
Policy Counterdrug Technology
Assessment Center
48
40
Federal Drug Control Programs:
High Intensity Drug Trafficking
Areas Program
225
206
Federal Drug Control Programs:
Other Programs
222
250
Total, EOP and Funds
Appropriated to the President
777
790
Source: United States House of Representative, Committee on Appropriations, Table: President’s
Request with Outlays, FY2004.
The Transportation, Treasury and General Government Appropriations bill
funds all but three offices in the Executive Office of the President (EOP). Of the

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CRS-26
three exceptions, the Council on Environmental Quality and Office of Environmental
Quality, and the Office of Science and Technology Policy are funded under the
Veterans Affairs, Housing and Urban Development, and Independent Agencies
appropriations; and the Office of the United States Trade Representative is funded
under the Commerce, Justice, State, and the Judiciary and Related Agencies
appropriations.
The President’s FY2004 budget proposes to consolidate and financially realign
several annual EOP salaries and expenses appropriations that directly support the
President into a single annual appropriation, called “The White House.” This
consolidated appropriation would total $183.8 million in FY2004, a decrease of 3.0%
from the $189.4 appropriated in FY 2003 for the accounts proposed to be
consolidated. The accounts included in the consolidated appropriation would be:
! Compensation of the President
! White House Office (including resources for the Office of Homeland
Security)
! Executive Residence/White House Repair and Restoration
! Office of Policy Development
! Council of Economic Advisers
! National Security Council
! Office of Administration
The budget states that the consolidation “initiative provides enhanced flexibility
in allocating resources and staff in support of the President and Vice President, and
permits more rapid response to changing needs and priorities.”12 The Administration
proposed similar consolidations in the FY 2002 and FY 2003 budgets, but the
conference committees for the Treasury and General Government Appropriations
Act, FY 2002 (P.L. 107-67) and FY 2003 (P.L. 108-7, Division J) agreed to continue
with separate appropriations for the EOP accounts. A concern of the Administration
has been the “needless complexity [of different accounts] that adds expense, that
adds burdens, that adds administrative hurdles that they must go through to
accomplish anything.”13 A concern of Congress about consolidation has been its
“legitimate needs and desires to have oversight over spending of public funds.”14
Included with the FY2004 budget request for consolidation is a proposal for a
Title VI general provision that would provide for a 10% transfer authority among the
following accounts:
12 U.S. Executive Office of the President, Office of Management and Budget, Budget of the
United States Government Fiscal Year 2004 Appendix (Washington: GPO, 2003), p. 882.
(Hereafter referred to as FY2004 Budget, Appendix.)
13 Representative Ernest Istook, then chairman of the Subcommittee on Treasury, Postal
Service and General Government of the House Committee on Appropriations, discussing
the FY 2002 proposal for consolidation of the Executive Office of the President accounts.
Congressional Record, daily edition, July 25, 2001, p. H4570.
14 Ibid.

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CRS-27
! The White House (Compensation of the President, White House
Office (including the Office of Homeland Security), Executive
Residence, White House Repair and Restoration, Office of
Administration, Office of Policy Development, National Security
Council, Council of Economic Advisers)
! Office of Management and Budget
! Office of National Drug Control Policy
! Special Assistance to the President and Official Residence of the
Vice President (transfers would be subject to the approval of the
Vice President)
! Council on Environmental Quality and Office of Environmental
Quality
! Office of Science and Technology Policy
! Office of the United States Trade Representative15
According to the EOP budget submission, the transfer authority would “allow
the President to address, in a limited way, emerging priorities and shifting demands”
and would “provide the President with flexibility, improve the efficiency of the EOP,
and reduce administrative burdens.”16 The OMB director, or such other officer as the
President may designate, could, 15 days after giving notice to the Senate and House
Committees on Appropriations, transfer up to 10% of any appropriation to any other
appropriation, to be merged with, and available for, the same time and for the same
purposes as the appropriation to which transferred. An appropriation could not be
increased by more than 50% by such transfers.17
EOP Offices Funded Through Treasury and General Government
Appropriations. The President’s FY2004 budget for EOP programs funded under
the Treasury and General Government appropriations proposes an appropriation of
$790.6 million, an increase of 1.7% over the $777.0 million appropriated in FY 2003.
The FY2004 budget proposals for specific accounts are discussed below.
Compensation of the President. The President’s FY2004 budget proposes
an appropriation of $450,000, which includes an expense allowance of $50,000. This
is the same amount as was appropriated in FY 2003. The salary of the President is
$400,000 per annum, effective January 20, 2001.
White House Office (WHO). This account provides the President with staff
assistance and administrative services.
The President’s FY2004 budget proposes an appropriation of $70.3 million, an
increase of 39.5% over the $50.4 million appropriated in FY 2003.
15 FY2004 Budget, Appendix, p. 882. U.S. Executive Office of the President, Fiscal Year
2004 Congressional Budget Submission (Washington: GPO, [Feb. 2003]), p. 11. (Hereafter
referred to as EOP Budget Submission.)
16 EOP Budget Submission, p. 11.
17 Ibid.

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CRS-28
Office of Homeland Security (OHS). This office provides support and
advice to the President and interagency coordination of all aspects of homeland
security, including the implementation of the National Strategy for Homeland
Security. The funding for OHS is included in the White House Office request. Of
the $70.3 million requested for the WHO for FY2004, $8.3 million is for the OHS.
The OHS FY 2003 appropriation was $19.3 million. The Homeland Security
Council functions established in the Homeland Security Act of 2002, P.L. 107-296,
are supported by the OHS budget.
Executive Residence (White House) Operation and Care. These
accounts provide for the care, maintenance, and operation of the Executive Residence
and its repair, alteration, and improvement.
The President’s FY2004 budget proposes an overall appropriation of $16.7
million for this account, an increase of 25.4% over the $13.3 million appropriated in
FY 2003. For the executive residence, the budget proposes an appropriation of $12.5
million, an increase of 2.9% over the $12.3 million appropriated in FY 2003. For
repair and restoration of the White House, the budget proposes an appropriation of
$4.2 million, an increase of 254.4% over the $1.2 million appropriated in FY 2003.
The EOP budget submission states that the repair and restoration funding would be
used to renovate various specific electrical, mechanical, and control system
components; replace two power servers; and complete the second phase of the
restoration of the East and West Wing exterior.18
Maintenance and repair costs for the White House are also funded by the
National Park Service as part of that agency’s responsibility for national monuments.
Entertainment costs for state functions are funded by the Department of State.
Reimbursable political events in the Executive Residence are to be paid for in
advance by the sponsor, and all such advance payments are to be credited to a
Reimbursable Expenses account. The political party of the President is to deposit
$25,000 to be available for expenses relating to reimbursable political events during
the fiscal year. Reimbursements are to be separately accounted for and the
sponsoring organizations billed, and charged interest, as appropriate. The staff of the
Executive Residence must report to the Committees on Appropriations, after the
close of each fiscal year, and maintain a tracking system on the reimbursable
expenses.
Special Assistance to the President (Office of the Vice President).
This account funds the Vice President in carrying out the responsibilities assigned to
him by the President and by law.
The President’s FY2004 budget proposes an appropriation of $4.5 million for
salaries and expenses, an increase of 10.4% over the $4.0 million appropriated in FY
2003. According to the EOP budget submission:
An additional programmatic increase of $70,000, or 1.7 percent was requested
for costs associated with official Vice Presidential travel. Since September 11,
18 EOP Budget Submission, p. 62.

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CRS-29
2001, the Vice President’s travel has been augmented by travel to undisclosed
locations for security purposes. This travel is 100 percent official ...19
Official Residence of the Vice President. This account provides for the
care and operation of the Vice President’s official residence and includes the
operation of a gift fund for the residence.
The President’s FY2004 budget proposes an appropriation of $331,000 for the
operating expenses of the Official Residence, an increase of 2.8% over the $322,000
appropriated in FY 2003.
Council of Economic Advisers (CEA). The three-member council was
created in 1946 to assist and advise the President in the formulation of economic
policy. The council analyzes and evaluates the national economy, economic
developments, federal programs, and federal policy to formulate economic advice.
The council assists in the preparation of the annual Economic Report of the President
to Congress.
The President’s FY2004 budget proposes an appropriation of $4.5 million, an
increase of 20.4% over the $3.8 million appropriated in FY 2003.
Office of Policy Development. The Office supports and coordinates the
Domestic Policy Council (DPC) and the National Economic Council (NEC) in
carrying out their responsibilities to advise and assist the President in formulating,
coordinating, and implementing economic and domestic policy. The office also
supports other policy development and implementation initiatives.
The President’s FY2004 budget proposes an appropriation of $4.1 million, an
increase of 27.2% over the $3.2 million appropriated in FY 2003. Of the total, an
estimated $2.1 million supports the Office of Policy Development’s DPC functions
and $2.0 million supports the office’s NEC functions.20
National Security Council (NSC). The NSC advises the President on
integrating domestic, foreign, military, intelligence, and economic policies relating
to national security.
The President’s FY2004 budget proposes an appropriation of $10.6 million, an
increase of 35.8% over the $7.8 million appropriated in FY 2003. Of the total, $9.8
million funds the operations of the NSC, including the Office for Combating
Terrorism, and $741,000 funds the President’s Foreign Intelligence Advisory
Board.21
Office of Administration. The Office of Administration provides
administrative services, including information technology; human resources
19 EOP Budget Submission, p. 164.
20 EOP Budget Submission, p. 102.
21 EOP Budget Submission, p. 129.

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CRS-30
management; library and records management; financial management; and facilities,
printing, and supply, to the Executive Office of the President.
The President’s FY2004 budget proposes an appropriation of $77.2 million, a
decrease of 15.1% from the $90.9 million appropriated in FY 2003. Of the total,
$56.6 million is for salaries and expenses and $20.6 million is for capital
investment.22
Office of Management and Budget (OMB). OMB assists the President
in discharging budgetary, management, and other executive responsibilities. The
agency’s activities include preparing the budget documents; examining agency
programs, budget requests, and management activities; preparing the government-
wide financial management status report and five-year plan (with the Chief Financial
Officer Council); reviewing and coordinating agency regulatory proposals and
information collection requirements; and promoting economical, efficient, and
effective procurement of property and services for the executive branch.
The President’s FY2004 budget proposes an appropriation of $77.4 million, an
increase of 24.9% over the $62.0 million appropriated in FY 2003. According to the
EOP budget submission, “Since the start of the Administration, OMB has maintained
a very tight budget” and “In light of constrained funding levels over the past two
years, the majority of the increase in the FY2004 request will permit OMB to
continue current operations.”23
Office of National Drug Control Policy (ONDCP). The ONDCP develops
policies, objectives, and priorities for the National Drug Control Program. The
account also funds general policy research to support the formulation of the National
Drug Control Strategy.
The President’s FY2004 budget proposes an appropriation of $27.3 million, an
increase of 3.8% over the $26.3 million appropriated in FY 2003. Of the total, $25.9
million is for salaries and expenses operations and $1.4 million is for policy
research.24
The Counterdrug Technology Assessment Center (CTAC). The
CTAC is the central counterdrug research and development organization for the
federal government.
The President’s FY2004 budget proposes an appropriation of $40 million, a
decrease of 16.1% from the $47.7 million appropriated in FY 2003. Of the total, $18
million is for counternarcotics research and development projects (which shall be
22 EOP Budget Submission, p. 73.
23 EOP Budget Submission, p. 189.
24 EOP Budget Submission, p. 216.

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CRS-31
available for transfer to other federal departments or agencies) and $22 million is for
the continued operation of the technology transfer program.25
Federal Drug Control Programs. The High Intensity Drug Trafficking
Areas (HIDTA) program provides assistance to federal, state, and local law
enforcement entities operating in those areas most adversely affected by drug
trafficking. Funds are disbursed at the discretion of the director of ONDCP for joint
local, state, and federal initiatives.
The President’s FY2004 budget proposes an appropriation of $206.4 million,
a decrease of 8.2% from the $224.9 million appropriated in FY 2003. No less than
51% of the total shall be transferred to State and local entities for drug control
activities, which shall be obligated within 120 days of enactment of the
Transportation/Treasury appropriations act. Up to 49% of the total shall remain
available until September 30, 2005, and may be transferred to federal agencies and
departments at a rate to be determined by the director, of which not less than $2.1
million shall be used for auditing services and associated activities, and at least
$500,000 of the $2.1 million shall be used to develop and implement a data
collection system to measure the performance of the High Intensity Drug Trafficking
Areas Program.26
Other Federal Drug Control Programs (formerly The Special
Forfeiture Fund). The account, administered by the director of ONDCP, supports
high-priority drug control programs. The funds may be transferred to drug control
agencies or directly obligated by the ONDCP director.
The President’s FY2004 budget proposes an appropriation of $250 million, an
increase of 12.7% over the $221.7 million appropriated in FY 2003. Of the total,
$170 million is to support a national media campaign, as authorized by the Drug-Free
Media Campaign Act of 1998; $70 million is for a program of assistance and
matching grants to local coalitions and other activities, as authorized in chapter 2 of
the National Narcotic Leadership Act of 1988, as amended; $4.5 million is for the
Counterdrug Intelligence Executive Secretariat; $2 million is for evaluations and
research related to National Drug Control Program performance measures; $1 million
is for the National Drug Court Institute; $1.5 million is for the United States Anti-
Doping Agency for anti-doping activities; and $1 million is for the United States
membership dues to the World Anti-Doping Agency.27
Unanticipated Needs. The account provides funds for the President to meet
unplanned and unbudgeted contingencies for national interest, security, or defense
purposes.
25 FY2004 Budget, Appendix, p. 1053.
26 FY2004 Budget, Appendix, p. 1051.
27 FY2004 Budget, Appendix, p. 1052.

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The President’s FY2004 budget proposes an appropriation of $1 million. This
is virtually the same amount as was appropriated in FY 2003 ($993,000 after
rescission).
Title V: Independent Agencies
Table 9. Title V: Related Agencies Appropriations
(in millions of dollars)
FY2003
FY2004
FY2004 FY2004
FY2004
Agency
Enacted
Request
House
Senate
Enacted
National Transportation Safety
Board
72
72
Federal Election Commission
50
50
Election Assistance Commission
835
500
Federal Labor Relations
Authority
29
30
Federal Maritime Commission
17
18
General Services Administration
(Total)
1,222
464
Federal Buildings Fund
(appropriations)
373
217
Federal Buildings Fund
(limitations on obligations)
6,567
6,634
Policy
66
74
Operating Expenses
72
85
Office of Inspector General
38
39
Electronic Government (E-
Gov) Fund
5
45
Election Reform Payments
650
—
Merit Systems Protection Board
34
36
Morris K. Udall Foundation
3
1
National Archives and Records
Administration
262
298
Office of Personnel Management
(total)
16,558
18,012
Government Payments for
Annuitants, Employees
Health Benefits
6,853
7,219
Government Payments for
Annuitants, Employee Life
Insurance
34
35
Payment to Civil Service
Retirement and Disability
Fund
9,410
9,987

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CRS-33
FY2003
FY2004
FY2004 FY2004
FY2004
Agency
Enacted
Request
House
Senate
Enacted
Office of Special Counsel
12
14
United States Tax Court
37
40
Total, Related Agencies
19,151
19,556
Source: United States House of Representative, Committee on Appropriations, Table: President’s
Request with Outlays, FY2004.
Federal Election Commission (FEC). The FEC administers federal
campaign finance law, including overseeing disclosure requirements, limits on
contributions and expenditures, and the presidential election public funding system;
the agency retains civil enforcement authority for the law. The Office of Election
Administration, which serves as a clearinghouse for information on voting laws and
procedures for state and local election officers, is another part of the FEC .
The President’s fiscal 2004 budget proposes an appropriation of $50.4 million
for the FEC, a 1.8% increase over the fiscal 2003 appropriation of $49.5 million.
The FEC, in its separate budget submission to Congress, concurs with the
Administration proposal, both in the request for overall appropriations and for 391
employees. The agency noted in its submission that the 1.8% increase represented
“essentially a Current Services request,” reflecting only an adjustment for inflation
and salary and benefits increases but no additional funds or staff for new programs
or initiatives. The agency attributed the essentially stable budget request to the
greater efficiency resulting from mandatory electronic filing and the new
administrative fine and Alternative Dispute Resolution programs.
Federal Labor Relations Authority (FLRA). The FLRA serves as a
neutral party in the settlement of disputes that arise between unions, employees, and
federal agencies on matters outlined in the Federal Service Labor Management
Relations Statute; decides major policy issues; prescribes regulations; and
disseminates information appropriate to the needs of agencies, labor organizations,
and the public. The FLRA also engages in case-related interventions and training and
facilitates labor-management relationships. It has three components: the Authority
which adjudicates labor-management disputes; the Office of the General Counsel
which, among other duties, investigates all allegations of unfair labor practices filed
and processes all representation petitions received; and the Federal Service Impasses
Panel which resolves impasses which occur during labor negotiations between
federal agencies and labor organizations.
The President’s FY2004 budget proposes an appropriation of $29.6 million for
the FLRA, an increase of 3.0% over the $28.8 million appropriated in FY 2003.
General Services Administration (GSA). The General Services
Administration administers federal civilian procurement policies pertaining to the
construction and management of federal buildings, disposal of real and personal
property, and management of federal property and records. It is also responsible for
managing the funding and facilities for former Presidents and presidential transitions.

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CRS-34
The President’s FY2003 budget request for GSA includes the largest requests to date
to renovate and improve security measures in federal buildings.
Table 10. General Services Administration Appropriations
(in millions of dollars)
FY2003
FY2004
FY2004
FY2004
FY2004
Fund / Office
Enacted
Request
House
Senate
Enacted
Federal Buildings Fund
Appropriations
373
217
Limitations on
Obligations
6,567
6,634
Government-wide Policy
66
74
Operating Expenses
72
85
Office of Inspector
General
38
39
Allowances and Office
Staff for Former
Presidents
3
3
Electronic Government
(E-Gov) Fund
5
45
Election Reform
Payments and
Reimbursements
665
—
GSA appropriations
total
1,222
464
Source: United States House of Representative, Committee on Appropriations, Table: President’s
Request with Outlays, FY2004.
The President’s FY2004 budget contains a request of $74.0 million for
government-wide policy and $85.1 million for operating expenses; $39.2 million
for the Office of Inspector General, $3.4 million for allowances and office staff for
former Presidents; $45.0 million for interagency electronic government initiatives;
and $17.6 million to be deposited into the Federal Consumer Information Center
Fund.
Federal Buildings Fund (FBF). Revenue to the FBF is the principal source
of funding. Congress, however, directs the GSA as to the allocation or limitation on
spending of funds.
The President’s FY2004 budget requests that an additional $217.0 million be
deposited into the Federal Buildings Fund, for a total of $6,579.9 million. An
amount not to exceed $400.6 million is to remain available until expended for new
construction projects. An additional $1,012.7 million is to remain available until
expended for repairs and alterations. This amount includes $217.2 million for repairs

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to five existing courthouses; $20.0 million to implement a glass fragmentation
program; $5.0 million to implement a chlorofluorocarbons program; and “amounts
to provide such reimbursable fencing, lighting, guard booths, and other facilities on
private or other property not in Government ownership or control as may be
appropriate to enable the United States Secret Service to perform its protective
functions pursuant to 18 U.S.C. 3056.”
Electronic Government Fund. The President’s budget for FY2004 seeks
$45 million for the e-government fund. The account statement notes that the fund
has been authorized by the E-Government Act of 2002, which may serve to reduce
or eliminate some of the past controversy about the management of the fund.28 Under
the terms of the authorizing provision, the fund is administered by the Administrator
of General Services as a GSA account to support projects approved by the director
of OMB. No monies may be transferred from the fund to any agency until 15 days
after the Administrator has submitted to the House Committee on Appropriations and
Committee on Government Reform and the Senate Committee on Appropriations and
Committee on Governmental Affairs a notification and description of how the funds
are to be allocated and how the expenditure will further the purposes of Chapter 36
of Title 44, United States Code.
Funding for the Electronic Government Fund was a somewhat contentious
matter between the President and Congress in FY2003, as it had been in FY2002.
In advance of his proposed budget for FY2002, the President released, on February
28, 2001, A Blueprint for New Beginnings: A Responsible Budget for America’s
Priorities. Intended as a 10-year budget plan, the Blueprint, among other
innovations, proposed the establishment of an electronic government account, seeded
with “$10 million in 2002 as the first installment of a fund that will grow to a total
of $100 million over three years to support interagency electronic Government (e-
gov) initiatives.” Managed by OMB, the fund was foreseen as supporting “projects
that operate across agency boundaries,” facilitating “the development of a Public Key
Infrastructure to implement digital signatures that are accepted across agencies for
secure online communications,” and furthering “the Administration’s ability to
implement the Government Paperwork Elimination Act of 1998, which calls upon
agencies to provide the public with optional use and acceptance of electronic
information, services and signatures, when practicable, by October 2003.”29 About
one month later, on March 22, OMB Deputy Director Sean O’Keefe announced that
the Bush Administration had decided to double the amount to be allocated to the e-
gov fund, bringing it to $20 million.30
As included in the President’s budget, the fund was established as an account
within the General Services Administration (GSA), to be administered by the
Administrator of General Services “to support interagency projects, approved by the
28 See 116 Stat. 2899 at 2906; 44 U.S.C. 3604.
29 U.S. Executive Office of the President, Office of Management and Budget, A Blueprint
for New Beginnings, pp. 179-180.
30 William Matthews, “Bush E-gov Fund to Double,” Federal Computer Week, vol. 15, Mar.
26, 2001, p. 8.

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Director of the Office of Management and Budget, that enable the Federal
Government to expand its ability to conduct activities electronically, through the
development and implementation of innovative uses of the Internet and other
electronic methods.” The President’s initial request for the fund was $20 million, to
remain available until September 30, 2004. Congress, however, appropriated $5
million for the fund for FY2002, to remain available until expended. Appropriators
specified that transfers of monies from the fund to federal agencies could not be
made until 10 days after a proposed spending plan and justification for each project
to be undertaken using such monies had been submitted to the Committees on
Appropriations. Expressing general support for the purposes of the fund, they also
recommended, and both chambers agreed, that the administration work with the
House Committee on Government Reform and the Senate Committee on
Governmental Affairs to clarify the status of its authorization.
The President’s budget for FY2003 “recognizes GSA as operator of the official
federal portal for providing citizens with one-stop access to federal services via the
Internet or telephone” and, therefore, a key agency in implementing the President’s
e-gov vision, which will “require cross-agency approaches that permit citizens,
businesses, and state and local governments to easily obtain services from, and
electronically transact business with the federal government.” In this regard, an
administration interagency Quicksilver E-Gov Task Force, according to the budget,
“identified 23 high priority Internet services for early development.” Seeking $45
million for the e-gov fund, the budget acknowledged that this amount was “a
significant increase over the $20 million requested in 2002,” but noted that the
request “is supported by specific project plans developed by the Quicksilver Task
Force.”31 Furthermore, according to the fund account statement, these monies
“would also further the Administration’s implementation of the Government
Paperwork Elimination Act (GPEA) of 1998, which calls upon agencies to provide
the public with optional use and acceptance of electronic information, services, and
signatures, when practicable, by October 2003.”
The House Appropriations Committee again rejected the amount requested by
the President and recommended $5 million for the fund, reiterating, as previously,
that transfers of monies from the fund to federal agencies could not be made until 10
days after a proposed spending plan and justification for each project to be
undertaken using such monies had been submitted to the Committees on
Appropriations. The committee also declined to recommend an appropriation for the
fund as a GSA account, but did fund it as an account under the jurisdiction of the
Office of Management and Budget within the Executive Office of the President.32
The Senate Committee on Appropriations recommended the full $45 million
requested by the President. Their report states that OMB “would control the
allocation of the fund and direct its use for information systems projects and affect
31 U.S. Office of Management and Budget, Fiscal Year 2003 Budget of the U.S. Government,
pp. 386-387.
32 U.S. Congress, House Committee on Appropriations, Treasury, Postal Service, and
General Government Appropriations Bill, 2003, a report to accompany H.R. 5120, 107th
Cong., 2nd sess., H.Rept. 107-575 (Washington: GPO, 2002), pp. 64, 83.

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multiple agencies and offer the greatest improvements in access and service.”33 Final
funding, as provided by P.L. 108-7, was $5 million.
Merit Systems Protection Board (MSPB). The MSPB serves as guardian
of the federal government’s merit-based system of employment. The agency carries
out its mission by hearing and deciding appeals from federal employees of removals
and other major personnel actions. The MSPB also hears and decides other types of
civil service cases, reviews OPM regulations, and conducts studies of the merit
systems. The agency’s efforts are to assure that personnel actions taken involving
employees are processed within the law and that actions taken by OPM and other
agencies support and enhance federal merit principles.
The President’s FY2004 budget proposes an appropriation of $35.5 million for
the MSPB. The request is 11.6% more than the $31.8 million appropriated in FY
2003. The MSPB budget submission states that the amount requested includes
“$75,000 to provide for employee and managerial development opportunities” and
“$100,000 to comply with the Accountability of Tax Dollars Act of 2002, Public Law
107-289, which requires audited financial statements for agencies with over
$25,000,000 in appropriated funds in their budget.”34 According to the budget
submission:
Beginning in fiscal year 2004, at the request of [OMB], the [MSPB] is not
requesting funds be transferred from the Civil Service Retirement and Disability
Trust Fund. Instead, the funding previously supplied from the Trust Fund for
adjudication of Civil Service Retirement appeals is being requested as part of the
regular appropriation total of $35,503,000. OMB has recommended this change
to simplify the financial record keeping for both the [MSPB] and the Civil
Service Retirement and Disability Trust Fund. We checked with the Office of
Personnel Management, which has responsibility for the Trust Fund, and they
have no objection to this change.35
Office of Personnel Management (OPM). The budget for OPM is
comprised of budget authority for both permanent and current appropriations. This
report discusses the budget authority for current appropriations. The agency is
responsible for administering personnel functions. The OPM helps agencies to
develop merit-based human resources management accountability systems to support
their missions. The Strategic Human Resources Policy Division designs and
develops human resources policies and strategies linked to agency accomplishment
of missions. The Human Capital Leadership and Merit Systems Accountability
Division assists agencies in implementing and assessing human capital strategies.
The Human Resources Products and Services Division supports federal agencies by
administering retirement and insurance programs, providing personnel investigation
33 S.Rept. 107-212, p. 77.
34 U.S. Merit Systems Protection Board, Fiscal Year 2004 Budget Justification, Feb. 3, 2003,
p. 6.
35 Ibid., p. 5.

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services, managerial and executive training, and other human resources services.36
The Office of Inspector General (OIG) conducts audits, investigations, evaluations,
and inspections throughout the agency and may issue administrative sanctions related
to the operation of the Federal Employees Health Benefits Program.
The President’s FY2004 budget proposes an appropriation of $18.0 billion for
OPM. This total includes discretionary funding of $118.7 million37 for salaries and
expenses and $1.5 million for OIG salaries and expenses. It also includes mandatory
funding of $7.5 billion for the government payment for annuitants of the employees
health benefits program, $35.0 million for the government payment for annuitants of
the employee life insurance program, and $10.0 billion for payment to the civil
service retirement and disability fund. Included in this total as well are trust fund
transfers of $135.9 million38 for salaries and expenses and $14.4 million39 for OIG
salaries and expenses. (In FY 2003, $120.8 million for salaries and expenses and
$10.9 million for OIG salaries and expenses were transferred from trust funds.)
According to OPM’s budget submission, the $118.7 million requested for
salaries and expenses “includes $111,748,000 in annual funds [for such things as
enhanced information technology support and competitive sourcing studies],
$4,500,000 in no-year funds for e-Government (e-Gov) projects, and $2,500,000 to
remain available through the end of FY 2005 to coordinate and conduct program
evaluation and performance management.”40
With regard to the OIG, the budget states that the amount requested
will finance more audit staff, special agent criminal investigators, associated
analytical staff, and improved information systems. OPM expects to reduce the
audit cycle from 5 years to 3.6 years for community-related carriers. Recoveries
are expected to increase by $16 million annually as a result.41
The OPM budget request is 8.8% more than the $16.6 billion appropriated in FY
2003. Specifically, it is 7.7% less than the $128.6 million appropriated in FY 2003
36 U.S. Office of Personnel Management, Congressional Budget Justification; Annual
Performance Plan Fiscal Year 2004, Feb. 2003, p. 3. (Hereafter referred to as OPM Budget
Justification.)
37 Of this total of $118,748,000, $2,000,000 shall remain available until expended for the
cost of the enterprise human resources integration project, $2,500,000 shall remain available
until expended for the cost of leading the government-wide initiative to modernize federal
payroll systems and service delivery, and $2,500,000 shall remain available through
September 30, 2005 to coordinate and conduct program evaluation and performance
measurement.
38 Of this total of $135,914,000, $36,700,000 shall remain available until expended for the
cost of automating the retirement record keeping systems.
39 This money is for administrative expenses to audit, investigate, and provide other
oversight of OPM’s retirement and insurance programs.
40 OPM Budget Justification, p. 5.
41 FY2004 Budget, Appendix, p. 974.

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CRS-39
for salaries and expenses; 0.7% less than the $1.5 million for OIG salaries and
expenses; 5.3% more than the $6.9 billion for the government payment for annuitants
of the employees health benefits program; 2.9% more than the $34.0 million for the
government payment for annuitants of the employee life insurance program; and
6.1% more than the $9.4 billion for payment to the civil service retirement and
disability fund.42
Human Capital Performance Fund. The President’s FY2004 budget
proposes an appropriation of $500 million for this new fund which
is designed to create performance-driven pay systems for employees and
reinforce the value of employee performance management systems. The
Administration proposes providing additional pay over and above any annual,
across-the-board pay raise to certain civilian employees based on individual or
organizational performance and/or other critical agency human capital needs.
Ninety percent of funds appropriated would be distributed to agencies on a pro
rata basis, upon OPM approval of an agency’s plan. The remainder, and any
amount withheld from agencies due to inadequate plans, would be allocated at
the discretion of OPM.43
Office of Special Counsel (OSC). The agency investigates federal
employee allegations of prohibited personnel practices and, when appropriate,
prosecutes matters before the Merit Systems Protection Board; provides a channel for
whistle blowing by federal employees; and enforces the Hatch Act. In carrying out
the latter activity, the OSC issues both written and oral advisory opinions. The OSC
may require an agency to investigate whistle blower allegations and report to the
Congress and the President as appropriate.
The President’s FY2004 budget proposes an appropriation of $13.5 million for
the OSC, an increase of 9.2% over the $12.4 million appropriated in FY 2003.
According to the budget, the funding “will enable OSC to continue its efforts to
reduce its long-standing case processing backlogs .... This request provides funding
for seven additional full time staff in [the Hatch Act and Disclosure Units] to address
growing backlog concerns.”44
Title VI: General Provisions
This section of the report discusses, briefly, general provisions such as
government-wide guidance on basic infrastructure-like policies. Examples are
provisions related to the Buy America Act, drug-free federal workplaces, and
42 The amounts of $6,853,000,000; $34,000,000; and $9,410,000,000 for FY 2003 are from
P.L. 108-7. OPM notifies the Secretary of the Treasury of the “such sums as may be
necessary” to fund these accounts each fiscal year. The FY2004 estimates for these
accounts are $7,219,000,000; $35,000,000; and $9,987,000,000 (from the House Committee
on Appropriations Table: Presidents Request with Outlays, FY2004).
43 FY2004 Budget, Appendix, p. 973.
44 FY2004 Budget, Appendix, p. 1091.

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CRS-40
authorizing agencies to pay GSA bills for space renovation and other services which
are annually incorporated into the Treasury and General Government appropriations
legislation. Quite frequently, additionally, there have been provisions which relate
to specific agencies or programs. For both Transportation/Treasury-related general
provisions and government-wide general provisions, with noted exceptions, the
sections discussed here will be those which are new or contain modified policies.
The Administration’s proposed language for government-wide general
provisions is found the Appendix.45 Most of the general provisions continue language
which has appeared under that title for several years. For an array of reasons,
Congress has determined that reiterating the language is preferable to placing the
provisions in permanent law.
The Administration is recommending dropping several such provisions. The
provisions are listed below. Not listed are FY2003 provisions which related only to
the single fiscal cycle.
! Payment of salary to pending nominees. Repeats recommendation
to eliminate the provision (FY2003, Sec. 609) which prohibits
payment to political appointees functioning in jobs for which they
have been nominated, but not confirmed. This provision has been
in the bill for at least 20 years. The previous administration also
recommended its elimination.
! Regulations — resolutions of disapproval. Recommended
elimination of the provision (FY2003, Sec. 612) which prohibits use
of funds to “implement, administer, or enforce any regulation”
which has been disapproved through statutorily authorized means.
If the provision were eliminated, conceivably the executive could
continue regulatory activities which Congress had disapproved,
through resolution of disapproval or the Congressional Review Act.
The provision, in the bill since the early 1980s, had been
recommended for elimination previously by both the current and
Clinton administrations.
! Importation restrictions. Recommends elimination of provision
banning use of funds to Customs Service for importation or release
in the United States of goods found to be manufactured by forced or
indentured child labor (FY2003, Sec. 619). This provision may
reappear under the Department of Homeland Security appropriation.
! Federal employee training. Recommends elimination of provision
(FY2003, Sec. 621) which requires that no funds be obligated or
expended for employee training not directly related to the
employee’s official duties; that may induce high levels of emotional
response or psychological stress in some participants; that fails to
inform re course content or post-course evaluation; that contains
45 FY2004 Budget, Appendix, pp. 9-13.

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CRS-41
methods or content “associated with religious or quasi-religious
belief systems or ‘new age’ belief systems;” and that is offensive to,
or designed to change, participants’ personal values or lifestyles
away from the workplace. Elimination of this language, in the bill
since the mid-1990s, was requested in the last two budget cycles by
the Bush Administration and previously by the Clinton
Administration.
! Nondisclosure agreements. Section 622 (FY2003) prohibits the
use of funds to require and execute employee non-disclosure
agreements without those agreements having whistle-blower
protection clauses. The Bush proposal repeats their FY2002 and
FY2003 request for elimination of that provision, which has been in
the bill for over ten years.
! Mailing and telephone lists. Section 625 (FY2003) requires
approval by the Committees on Appropriations of release of any
“non-public” information such as mailing or telephone lists to any
person or any organization outside the federal government. The
Bush Administration is repeating their request for its elimination.
! Use of official time. Federal employees in executive agencies are
required (section 627, FY2003) to “use official time in an honest
effort to perform official duties.” That requirement, in the bill since
FY1999, has been slated for elimination by both the Bush and
Clinton budget proposals. The argument has been that the ethics
statutes, in fact, place that same requirement on all federal
personnel.
One of the Administration’s proposals is a continuation of a provision (FY2003,
Sec. 615) but with conforming language to include the Department of Homeland
Security. The Administration has recommended seven general provisions which
were not enacted as part of the FY2003 statute.
! Federal Employees Compensation Act amendment. The
Administration is repeating its request (proposed sec. 630) to amend
provisions of the Federal Employees Compensation Act (FECA)
which relates to workers’ compensation available to federal
employees.
! Accrual cost funding for federal pension. Funding would be
authorized if provisions like those of the proposed Managerial
Flexibility Act of 2001 (S. 1612, 107th Congress), relating to the
accrual of funds for the payment of federal pensions and post-
retirement health benefits, were enacted. Similar legislation has not
yet been introduced in the 108th Congress. (Proposed Sec. 631.)
! Transfer of funds. The Administration would be authorized to
transfer up to 5% from any appropriation, with certain limitations.
(Proposed Sec. 632.)

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CRS-42
! National Oceanographic Partnership Program Office.
Interagency funding would be authorized in support of the office.
(Proposed Sec. 634.)
! Executive Office of the President — transfer of funds. The
Administration would be allowed to transfer funds between accounts
funding operations in the Executive Office of the President.
(Proposed Sec. 635.) In the two previous funding cycles, the
Administration had requested that all of the accounts within the
Executive Office of President be consolidated into one account.
Congress rejected that proposal.
! Human Capital Performance Fund. A fund, administered by the
Office of Personnel Management, would be established under which
the agencies could be authorized to “provide targeted pay increases
to individual employees based on performance.” (Proposed Sec.
636.)
! Senior Executive Service. Proposed section 637 would change the
pay system for the Senior Executive Service.
Federal Personnel Issues
General Schedule Pay. Under the Federal Pay Comparability Act of 1990
(FEPCA), federal white collar employees, paid under the General Schedule and
related salary systems, are to receive annual adjustments based on two separate
mechanisms. The first is the adjustment to base pay which is based on changes in
private sector salaries as reflected in the Employment Cost Index (ECI). The rate of
pay adjustment is supposed to be the percentage rate of change in that element of the
ECI, minus 0.5. Under that formula, for January 2003, the base pay adjustment was
3.1%. On December 31, 2002, the President signed an Executive Order establishing
the salary schedules for federal civilian personnel effective January 2003.46
Under the provisions of Section 637, Division J, P.L. 108-7, the full pay
increase for the General Schedule is 4.1%. There was no stipulation as to how the
additional 1% would be apportioned between base pay and locality-based
comparability payments. The payment will be retroactive to January 2003. On
March 21, it was announced that the additional 1% would be applied exclusively to
locality-based comparability payments.47
46 U.S. National Archives and Records Administration, “Executive Order 13282 —
Adjustments of Certain Rates of Pay,” Federal Register, vol. 68, January 8, 2003
(Washington: GPO, 2003), pp. 1133-1142. E. O. 13282, dated December 31, 2002.
47 U.S. National Archives and Records Administration, “Executive Order 13291 — Further
Adjustment of Certain Rates of Pay,” Federal Register, vol. 68, March 25, 2003
(Washington: GPO, 2003), pp. 14525-14526. E. O. 13291, dated March 21, 2003.

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The President’s budget proposes a federal civilian pay increase of 2.0% in
January 2004.48 However, the proposal does not indicate how the pay increase would
be split between basic pay and locality-based payments for the General Schedule and
related pay systems.
Section 601 of the FY2004 budget resolution (H. Con. Res. 95, H. Rept. 108-71)
contained a Sense of the Senate provision stating that the civilian and military pay
increases should be in parity.
Federal Wage System. The Federal Wage System (FWS) is designed to
compensate the federal blue collar, or skilled labor, force at rates prevailing in local
wage areas for like occupations. If the statutory system were allowed to be managed
as planned, the wage rates and the rates of adjustment in the over 130 wage areas
would vary, according to the labor costs and compensation in the private sector. For
the last several years, Congress has limited the rates of adjustment, based on the rates
of adjustment for the General Schedule (P.L. 108-7, Division J, Section 613). Part
of the rationale for that decision is that, in certain high cost areas, some FWS wages
would exceed the salaries paid to General Schedule supervisors. Wages in lower
cost areas will be allowed to increase according to the findings of the wage surveys
but the high cost area wages will be capped.
P.L. 107-117 extends the Monroney Amendment out-of-area survey application
to Department of Defense personnel.
Senior Executive Service Salaries. Section 637 of the President’s
proposed General Provisions would amend the statute governing the determination
of salary levels for the Senior Executive Service. It would increase the level at which
the salaries are capped, both for base pay and for the application of locality pay. It
would eliminate the 6-tier system with a pay band system. It also would adjust
language related to pay for performance.49
Human Capital Performance Fund. The Administration’s FY2004 pay
proposal would combine a 2% across-the board increase with a performance
component. A $500 million fund would be set aside government-wide to allow
managers to reward top-performing individuals with permanent increases in base
pay.50
Members of Congress, Judges, and Other Officials. Under the Ethics
Reform Act of 1989, as amended, pay adjustments for federal officials, including
Members of Congress and judges, are also based on ECI calculations, but for a
different 12-month period. The ECI calculations dictated a pay adjustment in
January 2003 of 3.3%. However, the statute limits those adjustments to the rate of
adjustment for base pay of the General Schedule. Therefore, since the General
Schedule base pay was adjusted at the rate of 3.1%, 3.1% is the maximum rate of
48 FY2004 Budget, Analytical Perspectives, p. 287.
49 FY2004 Budget, Appendix, p. 13.
50 FY2004 Budget, Appendix, p. 12 and Analytical Perspectives, p. 287.

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CRS-44
adjustment in salaries of federal officials for January 2003. Because the mechanism
described above is automatic, no bill language is necessary to establish the pay
adjustment.51
Unlike that for Members of Congress and executive branch officials, the annual
pay increase must be specifically authorized for judges. The language permitting the
judges to receive the January 2003 increase was reported by the Senate Committee
on Appropriations as section 304 of S. 2778. However, Congress adjourned prior to
enactment. Therefore, the judges did not receive the 3.1% adjustment as of January
1, 2003. The 108th Congress enacted P.L. 108-652 for the purpose of permitting the
judges to receive the increase retroactive to the first of the year. At no time, since the
authorization was required, have the judges received lower adjustments than the other
officials.
President. Pursuant to the Treasury and General Government Appropriations
Act, 2000 (P.L. 106-58), effective noon, January 20, 2001, the President receives a
salary of $400,000 per annum. Since 1969, Presidents had been paid a salary of
$200,000. No further action on presidential pay is expected. Former Presidents
receive a pension equal to the rate of pay for Cabinet Secretaries (currently $171,900)
and the pension is adjusted automatically as those pay rates are changed.53
Federal Employees Workers’ Compensation Program (FECA). The
Federal Employees Compensation Act (FECA) provides workers’ compensation
benefits for Federal employees injured on the job. Under current law (5 U.S.C. Sect.
8147), the direct costs of these benefits are reimbursed via transfers from the budgets
of each Federal agency to the Labor Department, which administers the program and
disburses the benefits. The costs of administration are covered by appropriation
directly to the Labor Department.
The Administration is again proposing various changes in FECA that it
broached in the 107th Congress. The aspect that would affect agency budgets
government-wide is to charge administrative costs in the same manner as benefit
costs, i.e. through the appropriation of each employing agency. The stated intention
is to make each agency explicitly bear the full cost of their employees’ claims, thus
“bolstering their incentive to improve workplace safety.” The administrative
surcharge would be around 3.5% of benefit costs (calculated from the
Administration budget for FY2004, which contemplates $88 million in
administrative costs to service $2,532 million in program benefits). Most of the
surcharge would be paid by the two agencies that account for more than 60% of
51 See also, CRS Report RL30014, Salaries of Members of Congress: Current Procedures
and Recent Adjustments and CRS Report 97-1011, Salaries of Members of Congress:
Payable Rates and Effective Dates, 1789-2001, both by Paul E. Dwyer. Also see, CRS
Report RS20388, Salary Linkage: Members of Congress and Other Federal Officials; CRS
Report RS20278, Judicial Salaries: Current Situation; and CRS Report 98-53, Salaries of
Federal Officials, by Sharon S. Gressle.
52 P.L. 108-6; H.R. 16; February 13, 2003; 117 Stat. 10.
53 See CRS Report RS20114, Salary of the President Compared with That of Other Federal
Officials, by Sharon S. Gressle.

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FECA claims: the U.S. Postal Service and the Defense Department. (However, the
Postal Service already pays its share pursuant to 5 U.S.C. 8147(c).)

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

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

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CRS-48
For Additional Reading
CRS Products
CRS Report RS20177. Airport and Airway Trust Fund Issues in the 106th Congress,
by John W. Fischer.
CRS Issue Brief IB10026. Airport Improvement Program, by Robert S. Kirk.
CRS Report RL30659. Amtrak: Overview and Options, by David Randall Peterman.
CRS Report RL31743. Amtrak Issues in the 108th Congress, by David Randall
Peterman.
CRS Issue Brief IB90122. Automobile and Light Truck Fuel Economy: The CAFÉ
Standards, by Rob Bamberger.
CRS Report RS21321. Aviation Taxes and Fees: Major Issues, by John W. Fischer.
CRS Report RS20469. Bicycle and Pedestrian Transportation Policies, by William
Lipford and Glennon J. Harrison.
CRS Report RS20790. The Coordinated Border Infrastructure Program: Issues for
Congress, by Robert S. Kirk.
CRS Report RS20841. Environmental Streamlining Provisions in the
Transportation Equity Act for the 21st Century: Status of Implementation, by
David M. Bearden and Linda G. Luther.
CRS Issue Brief IB10030. Federal Railroad Safety Program and Reauthorization
Issues, by Paul F. Rothberg and John Williamson.
CRS Report RL31027. High-Speed Rail: Development and Investment Issues in the
107th Congress, by David Randall Peterman and Steven Maguire.
CRS Report RL31665. Highway and Transit Program Reauthorization, by John W.
Fischer, Coordinator.
CRS Report RS21164. Highway Finance: RABA’s Double-edged Sword, by John
W. Fischer.
CRS Report RL31150. Selected Aviation Security Legislation in the Aftermath of the
September 11 Attack, by Robert S. Kirk.
CRS Report RL31854. Transit Program Reauthorization in the 108th Congress, by
David Randall Peterman.

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CRS-49
CRS Report 98-646 ENR. Transportation Equity Act for the 21st Century (P.L.
105-178): An Overview of Environmental Protection Provisions, by David M.
Bearden.
CRS Issue Brief IB10032. Transportation Issues in the 108th Congress, coordinated
by Glennon J. Harrison.
Selected World Wide Web Sites
Department of Transportation Budget in Brief FY2003
[http://www.dot.gov/bib/bibindex.html]
Department of Transportation, Chief Financial Officer
[http://ostpxweb.dot.gov/budget/]
House Appropriations Committee
[http://www.house.gov/appropriations]
Interactive Budget Web Site
[http://ibert.org/civix.html]
Maritime Administration
[http://www.marad.dot.gov/]
National Highway Traffic Safety Administration (budget & planning)
[http://www.nhtsa.dot.gov/nhtsa/whatis/planning/perf-plans/gpra-96.pln.html]
Office of Management and Budget
[http://www.gpo.gov/usbudget/fy1998/fy1998_srch.html]
Senate Appropriations Committee
[http://www.senate.gov/committees/committee_detail.cfm?COMMITTEE_ID=405]

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CRS-50
Appendix 1: The Transportation Appropriations
Framework
Transportation is function 400 in the annual unified congressional budget. It is
also considered part of the discretionary budget. Funding for the DOT budget is
derived from a number of sources. The majority of funding comes from dedicated
transportation trust funds. The remainder of DOT funding is from federal Treasury
general funds. The transportation trust funds include: the highway trust fund, which
contains two accounts, the highway trust account and the transit account; the airport
and airway trust fund; and the inland waterways trust fund. All of these accounts
derive their respective funding from specific excise and other taxes.
In FY2002 trust funds accounted for well over two-thirds of total federal
transportation spending. Together, highway and transit funding constitute the largest
component of DOT appropriations. Most highway and transit programs are funded
with contract authority derived by the link to the highway trust fund. This is very
significant from a budgeting standpoint. Contract authority is tantamount to, but
does not actually involve, entering into a contract to pay for a project at some future
date. Under this arrangement, specified in Title 23 U.S.C., authorized funds are
automatically made available at the beginning of each fiscal year and may be
obligated without appropriations legislation; although appropriations are required to
make outlays at some future date to cover these obligations.
Where most federal programs require new budget authority as part of the annual
appropriations process, transportation appropriators are faced with the opposite
situation. That is, the authority to spend for the largest programs under their control
already exists, and the mechanism to obligate funds for these programs also is in
place.
Transportation Equity Act for the 21st Century (TEA-21)
During the 105th and 106th Congresses, major legislation changed the
relationships between the largest transportation trust funds and the federal budget.
The Transportation Equity Act for the 21st Century (TEA-21) (P.L. 105-178) linked
annual spending for highway programs directly to revenue collections for the
highway trust fund. In addition, core highway and mass transit program funding was
given special status in the discretionary portion of the federal budget by virtue of the
creation of two new budget categories. The Act thereby created a virtual “firewall”
around highway and transit spending programs. The funding guarantees were set up
in a way that makes it difficult for funding levels to be altered as part of the annual
budget/appropriations process. Additional highway funds can be provided annually
by a mechanism called “Revenue Aligned Budget Authority” (RABA); RABA funds
accrue to the trust fund as a result of increased trust fund revenues. For FY2003,
however, it now appears that the RABA adjustment, if it had been left intact during
the appropriations process, would have led to a significant and unexpected drop in
the availability of highway obligational funding.
TEA-21 changed the role of the House and Senate appropriations and budget
committees in determining annual spending levels for highway and transit programs.

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The appropriations committees are precluded from their former role of setting an
annual level of obligations. These were established by TEA-21 and are adjusted by
an annual RABA computation. In addition, it appears that TEA-21 precludes, at
least in part, the House and Senate appropriations committees from exercising what
some Members view as their once traditional option of changing spending levels for
specific core programs or projects. In the FY2000 appropriations act, the
appropriators took some tentative steps to regain some of their discretion over
highway spending. The FY2000 Act called for the redistribution of some funds
among programs and added two significant spending projects. In the FY2001
appropriations act, the appropriators continued in this vein by adding funds for large
numbers of earmarked projects. Further, the FY2001 Act called for redirection of a
limited amount of funding between programs and includes significant additional
funding for some TEA-21 programs. This trend continued, and even accelerated, in
the FY2002 Act as appropriators made major redistributions of RABA funds and, in
some instances, transferred RABA funds to agencies that are not eligible for RABA
funding under TEA-21.
Wendell H. Ford Aviation Investment and Reform Act for the
21st Century (FAIR21 or AIR21)
The Wendell H. Ford Aviation Investment and Reform Act for the 21st Century
(FAIR21 or AIR21)(P.L. 106-181) provides a so-called “guarantee” for Federal
Aviation Administration (FAA) program spending. The guarantee for aviation
spending, however, is significantly different from that provided by TEA-21. Instead
of creating new budget categories, the FAIR21 guarantee rests on adoption of two
point-of-order rules for the House and the Senate. Supporters of FAIR21 believe the
new law requires significant new spending on aviation programs; and, for at least the
FY2001 and FY2002 appropriations cycles, spending grew significantly. Most
observers view the FAIR21 guarantees, however, as being somewhat weaker than
those provided by TEA-21. Congress can, and sometimes does, waive points-of-
order during consideration of legislation.
Enactment of TEA-21 and FAIR21 means that transportation appropriators have
total control over spending only for the TSA, the Coast Guard, the Federal Railroad
Administration (including Amtrak), and a number of smaller DOT agencies. All of
these agencies are concerned about their funding prospects in any year where it is
believed that there is a constrained budgetary environment.

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Appendix 2: Transportation Budget Terminology
Transportation budgeting uses a confusing lexicon (for those unfamiliar with the
process) of budget authority and contract authority — the latter, a form of budget
authority. Contract authority provides obligational authority for the funding of trust
fund-financed programs, such as the federal-aid highway program. Prior to TEA-21,
changes in spending in the annual transportation budget component had been
achieved in the appropriations process by combining changes in budget/contract
authority and placing limitations on obligations. The principal function of the
limitation on obligations is to control outlays in a manner that corresponds to
congressional budget agreements.
Contract authority is tantamount to, but does not actually involve, entering into
a contract to pay for a project at some future date. Under this arrangement, specified
in Title 23 U.S.C., which TEA-21 amended, authorized funds are automatically made
available to the states at the beginning of each fiscal year and may be obligated
without appropriations legislation. Appropriations are required to make outlays at
some future date to cover these obligations. TEA-21 greatly limited the role of the
appropriations process in core highway and transit programs because the Act
enumerated the limitation on obligations level for the period FY1999 through
FY2003 in the Statute.
Highway and transit grant programs work on a reimbursable basis: states pay
for projects up front and federal payments are made to them only when work is
completed and vouchers are presented, months or even years after the project has
begun. Work in progress is represented in the trust fund as obligated funds and
although they are considered “used” and remain as commitments against the trust
fund balances, they are not subtracted from balances. Trust fund balances,
therefore, appear high in part because funds sufficient to cover actual and expected
future commitments must remain available.
Both the highway and transit accounts have substantial short- and long-term
commitments. These include payments that will be made in the current fiscal year
as projects are completed and, to a much greater extent, outstanding obligations to
be made at some unspecified future date. Additionally, there are unobligated
amounts that are still dedicated to highway and transit projects, but have not been
committed to specific projects.
Two terms are associated with the distribution of contract authority funds to the
states and to particular programs. The first of these, apportionments, refers to funds
distributed to the states for formula driven programs. For example, all national
highway system (NHS) funds are apportioned to the states. Allocated funds, are
funds distributed on an administrative basis, typically to programs under direct
federal control. For example, federal lands highway program monies are allocated;
the allocation can be to another federal agency, to a state, to an Indian tribe, or to
some other governmental entity. These terms do not refer to the federal budget
process, but often provide a frame of reference for highway program recipients, who
may assume, albeit incorrectly, that a state apportionment is part of the federal budget
per se.

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