Order Code RL31370
CRS Report for Congress
Received through the CRS Web
State Department and Related Agencies:
FY2003 Appropriations and FY2004 Request
Updated July 18, 2003
Susan B. Epstein
Specialist in Foreign Policy and Trade
Foreign Affairs, Defense, and Trade Division
Congressional Research Service ˜ The Library of Congress

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State Department and Related Agencies
FY2003 Appropriations and FY2004 Request
Summary
State Department appropriations are within the Commerce, Justice, State (CJS)
appropriation.
The President sent his FY2004 budget request to Congress on February 3, 2003,
seeking a total of $7,874.1 million for the Department of State and $563.5 million for
international broadcasting.
The House Appropriations Committee reported its FY2004 CJS appropriation
(as yet unnumbered) on July 16, 2003. The bill would provide $7,857.4 million for
State and $563.5 for broadcasting in FY2004. The total of $8,420.9 million is $223.3
million below the President’s FY2004 request. The bill may go to the floor the week
of July 21st.
The Senate is expected to take up FY2004 CJS appropriations before its August
recess.
The 108th Congress passed, and the President signed on February 20th, an
FY2003 omnibus funding package (H.J.Res. 2, P.L. 108-7) of 11 appropriations bills,
including that of CJS. It provides total new budget authority of $7,394.0 million for
the Department of State ($138.2 million of which is mandatory) and $506.6 million
for international broadcasting (all of which is discretionary). These figures and
others provided in this report do not reflect the 0.65% across-the-board rescission
also included in this consolidated budget.

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Contents
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
State Department . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Administration of Foreign Affairs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
International Organizations and Conferences . . . . . . . . . . . . . . . . . . . . . . . . 3
International Commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Related State Department Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Broadcasting Board of Governors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Visa Issuance and Homeland Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
List of Tables
Table 1. State Department and Related Agencies Appropriations . . . . . . . . . . . . . 8

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State Department and Related Agencies
FY2003 Appropriations and FY2004
Request
Background
Budgets for the Department of State and the Broadcasting Board of Governors
(BBG), as well as U.S. contributions to United Nations (U.N.) International
Organizations, and U.N. Peacekeeping, are within the Commerce, Justice, State and
Related Agency (CJS) appropriations. Intertwined with the annual appropriations
process is the biannual Foreign Relations Authorization that, by law, Congress must
pass prior to the State Department’s expenditure of its appropriations. (For details
on the history and the most recent foreign relations authorization Act, P.L. 107-228,
see CRS Report RL31046, Foreign Relations Authorization, FY2003: An Overview.)
On February 3, 2003 the Administration sent its FY2004 budget request to
Congress. The FY2004 request for the Department of State totals $8,080.7 million
and for international broadcasting it is $563.2 million. Throughout February, March,
and April 2003, Secretary of State Colin Powell testified before the House and Senate
Appropriations Committees on the State Department budget request. The House
Appropriations Full Committee reported its CJS FY2004 appropriation bill July 16,
2004. Table 1 provides regular and supplemental State Department and related
agencies’ appropriations for FY2002, FY2003 and FY2004.
State Department
The State Department’s mission is to advance and protect the worldwide
interests of the United States and its citizens through the staffing of overseas
missions, the conduct of U.S. foreign policy, the issuance of passports and visas, and
other responsibilities. Currently, the State Department coordinates with the activities
of 50 U.S. government agencies and organizations in operating more than 250 posts
in over 180 countries around the world. The Department’s staff size has increased,
largely because of the integration of Arms Control and Disarmament Agency
(ACDA) and the U.S. Information Agency (USIA) into State. Highlights follow.
Administration of Foreign Affairs
Diplomatic and Consular Programs (D&CP) — The D&CP account funds
overseas operations (e.g., motor vehicles, local guards, telecommunications,
medical), activities associated with conducting foreign policy, passport and visa
applications, regional bureaus, under secretaries, and post assignment travel.
Beginning in FY2000, the State Department’s Diplomatic and Consular Program

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account included State’s salaries and expenses, as well as the technology and
information functions of the former USIA, and the functions of the former ACDA.
For FY2003, the Bush Administration requested $3,936.8 million for D&CP
level, an 8% increase from the FY2002 appropriation, not including the
supplementals for this account. The 108th Congress enacted the House-recommended
level of $3,822.3. The funding supports the hiring and training of 399 new Foreign
and Civil Service employees. Congress designated $292.7 million in this account to
be available only for public diplomacy programs and $553 million for ongoing costs
involved with worldwide security upgrades. Some justify the total amount being
lower than the President’s request because this account had also received post-
September 11th supplementals totaling $183.5 million.
In the FY2004 budget, the Administration requested $4,163.5 million for
D&CP, a 9% increase, not including past supplementals and FY2003 rescissions.
Secretary of State Colin Powell testified before Congress in early 2003 that the
emphasis continues to be on new hiring and security. The House Appropriations
Committee set this account level at $4,100.0 million for FY2004.
Embassy Security, Construction and Maintenance (ESCM) — This account
supports the maintenance, rehabilitation, and replacement of overseas facilities to
provide appropriate, safe, secure and functional facilities for U.S. diplomatic
missions abroad. Congress originally had enacted $640 million for this account for
FY1999. However, following the embassy bombings in Africa in August 1998,
Congress agreed to more than $1 billion (within a supplemental funding bill) for the
Security and Maintenance account by establishing a new subaccount referred to as
Worldwide Security Upgrades.
Post 9/11 emergency supplemental funding for ESCM totaled $52.85 million
— $34.9 million for security improvements at U.S. embassy compounds and $18
million for emergency egress projects.
The President’s FY2003 request for ESCM totaled $1,305 million, an increase
of $92 million in ongoing operations and compound security over FY2002, but a
decline of $61 million in worldwide security funding. State Department officials
noted that the post 9/11 emergency supplemental was still in the pipeline for the
worldwide security account during the FY2003 budget year. The final FY2003
appropriated amount for ESCM was a total of $1,263.5, of which $755 was for
bricks-and-mortar-type worldwide security upgrades.
For FY2004, the President requested $653 million for regular ESCM
expenditures and $861.4 million for worldwide security upgrades, for a total account
level of $1,514.4, a 20% increase over FY2003. The funds would go toward embassy
compound construction in Berlin, and security construction of new embassy
compounds and USAID facilities, as well as acquisition of sites for future activities.
The House bill would provide $532.9 million for regular ESCM expenditures in
FY2004 and $861.4 million for worldwide security upgrades.
Educational and Cultural Exchanges — This account funds programs
authorized by the Mutual Educational and Cultural Exchange Act of 1961, such as

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the Fulbright Academic Exchange Program, as well as leadership programs for
foreign leaders and professionals. Government exchange programs came under close
scrutiny in past years for being excessive in number and duplicative. By a July 1997
executive order, the Office of U.S. Government International Exchange and Training
Coordination was created. For the FY2002 budget, Congress passed $237 million,
including $118 million for the Fulbright programs.
The Bush Administration requested $245.3 million for exchanges in FY2003 —
a 3.5% increase over the current enacted level. Congress passed $245.3 million to
support the traditional exchanges, including $123 million for the Fulbright Program,
as well as enhanced exchanges emphasizing Muslim and Arab populations.
The FY2004 request for Educational and Cultural Exchanges totals $345.3
million which includes a transfer of $100 million from Freedom Support Act (FSA)
and Support for Eastern European Democracy (SEED) programs which were
formerly within the foreign operations appropriation. Since that $100 million will
continue to be used to focus on Russia and New Independent States (NIS) exchanges,
the request for exchanges already administered within the Department of State is the
same as the FY2003 enacted level. The House level for FY2004 exchange programs
is identical to the request.
The Capital Investment Fund (CIF) — CIF was established by the Foreign
Relations Authorization Act of FY1994/95 (P.L. 103-236) to provide for purchasing
information technology and capital equipment which would ensure the efficient
management, coordination, operation, and utilization of State’s resources. In
FY1998 Congress approved a 250% increase in this fund, from $24.6 million in
FY1997 to $86 million in FY1998.
For FY2003 the Administration requested $177 million for CIF, a decline of
14.7% from the FY2002 enacted level of $203 million. The Administration cited a
more than doubling of this account from FY2001 to FY2002 and contended that the
request for FY2003 was in line with what they could use effectively. Congress
approved $183.3 million and the conferees noted they expect an additional $86
million in expedited passport fees to be allocated to this account in FY2003.
For FY2004, the Administration requested $157 million in addition to the
allocation of an estimated $114 million in expedited passport fees for CIF. The
House bill would provide $142 million.
International Organizations and Conferences
In recent years, U.S. contributions to U.N. international organizations and
peacekeeping activities have been complicated by a number of issues, such as the
withholding of funds related to international family planning policies. Recently,
some controversial issues have included: 1) the lack of agreement about the U.N.’s
role in the current worldwide dispute on how to deal with Iraq; and 2) the loss of the
U.S. seat on the U.N. Commission on Human Rights.
In past years, overdue U.S. arrearage payments had been an issue. Shortly after
the September 11th terrorist attack and at a time when the U.S. government was

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seeking U.N. support in its coalition to fight terrorism, however, Congress passed,
and the President signed, legislation (S. 248/P.L. 107-46) which allowed the United
States to make its second tranche ($475 million) of arrearage payments to the U.N.
(For more detail, see CRS Issue Brief IB86116, U.N. System Funding: Congressional
Issues, by Vita Bite.)
Contributions to International Organizations (CIO) — CIO provides funds for
U.S. membership in numerous international organizations and for multilateral foreign
policy activities that transcend bilateral issues, such as human rights. Maintaining
a membership in international organizations, the Administration argues, benefits the
United States by advancing U.S. interests and principles while sharing the costs with
other countries. Payments to the U.N. and its affiliated agencies, the Inter-American
Organizations, as well as other regional and international organizations are included
in this account.
For CIO’s FY2003 budget, the Bush Administration requested $891.4 million
(a 4.9% increase over FY2002 enacted). The level would have provided full funding
of U.S. regular contributions to the 43 international organizations, as well as the U.S.
share of U.N. building renovations. The final enacted level was $866 million.
For FY2004 President Bush requested $1,010.5 million for international
organizations, nearly 17% greater than the FY2003 enacted level. About half of the
$144.5 million increase is for rejoining UNESCO. The House Appropriations
Committee agreed with the President’s request and would provide $1,010.5 million.
Contributions to International Peacekeeping Activities (CIPA) — The United
States supports multilateral peacekeeping efforts around the world through payment
of its share of the U.N. assessed peacekeeping budget. Congress approved $844
million for this account for FY2002. The President’s FY2003 request for CIPA was
$726 million, a nearly 14% decline from the FY2002 enacted level. The final
enacted level was the House-recommended level of $673.7 million.
For FY2004, the President requested $550.2 million for CIPA. Depending on
events, particularly with Iraq, some believe the Administration may include CIPA in
a supplemental request in FY2003 and/or FY2004. (For more detail on international
peacekeeping, see CRS Issue Brief IB90103, United Nations Peacekeeping: Issues
for Congress, by Marjorie Ann Browne.) The House bill would provide the same
amount as the request for FY2004.
International Commissions
The International Commissions account includes the U.S.-Mexico Boundary
and Water Commission, the International Fisheries Commissions, the International
Boundary Commission, the International Joint Commission, and the Border
Environment Cooperation Commission. The final FY2002 enacted level equals $60.5
million. The Administration’s FY2003 request — $67.3 million — amounts to a
11.2% increase over FY2002. The FY2003 enacted level was $57.5 million. The
FY2004 request is for a 25% increase to $71.7 million. The House full committee,
however, would set the FY2004 funding at $57.1 million — just below the FY2003
level.

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Related State Department Appropriations
The Asia Foundation — The Asia Foundation is a private, nonprofit
organization that supports efforts to strengthen democratic processes and institutions
in Asia, open markets, and improve U.S.-Asian cooperation. The Foundation
receives both government and private sector contributions. Government funds for
the Asia Foundation are appropriated to, and pass through, the State Department.
Congress funded The Asia Foundation at $9.3 million for FY2002. The FY2003
request would raise the funding slightly to $9.4 million. The Senate recommended
increasing the FY2003 funding level of The Asia Foundation to $10.3 million; the
House bill set a similar funding level — $10.4 million. The final enacted level was
$10.4 million.
The FY2004 request is $9.3 million. The House bill would provide the current
level — $10.4 million — in FY2004.
National Endowment for Democracy (NED) — The National Endowment for
Democracy, a private nonprofit organization established during the Reagan
Administration, supports programs to strengthen democratic institutions in more than
90 countries around the world. NED proponents assert that many of its
accomplishments are possible because it is not a government agency. NED’s critics
claim that it duplicates U.S. government democracy programs and either could be
eliminated or could operate entirely with private funding. The final FY2002 enacted
level for NED was $33.5 million. The FY2003 request for NED’s funding level was
$36 million — a 7.5% increase over FY2002. The Senate recommended even more
— $46.5 million for NED to increase efforts to combat Islamic extremism in Muslim
countries. The House bill agreed with the President’s original request of $36 million
for NED in FY2003. Congress settled on $41.7 million for FY2003.
The FY2004 funding request for NED is $36 million. The House would provide
$42 million, however.
East-West and North-South Centers — The Center for Cultural and Technical
Interchange between East and West (East-West Center), located in Honolulu, Hawaii,
was established in 1960 by Congress to promote understanding and cooperation
among the governments and peoples of the Asia/Pacific region and the United States.
The Center for Cultural and Technical interchange between North and South (North-
South Center) is a national educational institution in Miami, FL, closely affiliated
with the University of Miami. It promotes better relations, commerce, and
understanding among the nations of North America, South America and the
Caribbean. The North-South Center began receiving a direct subsidy from the
federal government in 1991. In FY2002, Congress provided $14 million for the East-
West Center, but no funds for the North-South Center. The FY2003 request was for
$14.3 million. Congress finally enacted $17.9 million for the East-West Center’s
FY2003 budget and no funds for the North-South Center. The FY2004 funding
request is for $14.3 million. The House committee would not provide any funding
for the East-West Center in FY2004.

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CRS-6
Broadcasting Board of Governors
The United States International Broadcasting Act of 19941 reorganized within
USIA all U.S. government international broadcasting, including Voice of America
(VOA), Broadcasting to Cuba, Radio Free Europe/Radio Liberty (RFE/RL), Radio
Free Asia (RFA), and the newly-approved Radio Free Iraq and Radio Free Iran. The
1994 Act established the Broadcasting Board of Governors (BBG) to oversee all U.S.
government broadcasting; abolished the Board for International Broadcasting (BIB),
the administering body of RFE/RL; and recommended that RFE/RL be privatized by
December 31, 1999. This recommendation was repealed by P.L. 106-113.
During the reorganization debate in 1999, the 105th Congress agreed that
credibility of U.S. international broadcasting was crucial to its effectiveness as a
public diplomacy tool. Therefore, Congress agreed not to merge broadcasting
functions into the State Department, but to maintain the Broadcasting Board of
Governors (BBG) as an independent agency as of October 1, 1999.
In addition to the annual FY2002 appropriation, and in response to the
September 11th attack, Congress provided Emergency Response Funds (P.L. 107-38
and P.L. 107-117) which provide the BBG with $28.65 million to support VOA
broadcasts in Arabic, Farsi, Pashto, Dari, and Urdu, and RFE/RL broadcasts in
Arabic, Farsi, Tajik, Turkmen, Uzbek, Kazakh, Krygyz, and Azeri in the coming year
and $19.2 million to establish a new Radio Free Afghanistan.
For FY2003, the Administration requested a total of $507 million for
international broadcasting, including $467.9 million for broadcasting operations,
$13.7 million for capital improvements, and $25.4 million for Cuba broadcasting.
The final appropriation of $506.6 million set funding near the President’s request.
After a rescission and a supplemental (P.L. 108-11) of $30 million, the current
enacted FY2003 funding level totals $533.8 million.
The request for FY2004, however, is somewhat higher — $563.5 million. The
House Appropriations Committee agrees with that level.
Visa Issuance and Homeland Security
The State Department traditionally has had sole authority to issue visas
overseas. The Homeland Security Act of 2002 (H.R. 5005/P.L. 107-296, signed into
law on November 25, 2002) now provides the Secretary of the Department of
Homeland Security (DHS) with exclusive authority to: 1) issue regulations regarding
administering and enforcing visa issuance, 2) impose upon any U.S. government
employee, with consent of the head of his/her agency, any functions involved in visa
issuance, 3) assign DHS employees to each overseas post where visas are issued, and
4) use the National Foreign Affairs Training Center to train DHS employees who will
1 Title III of the Foreign Relations Authorization Act, Fiscal Years 1994 and 1995, P.L. 103-
236.

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CRS-7
be involved in visa issuance. The Act states that these authorities will be exercised
through the Secretary of State. The Homeland Security Act of 2002 further provides
the Secretary of State and consular officers with the authority to refuse visa
applications. The Act stipulates that within one year after the Act is signed, the
Secretary of DHS and the Secretary of State must report to Congress on
implementation of visa issuance authorities and any proposals that are necessary to
improve the activities surrounding visa issuance. Specifically regarding visa issuance
in Saudi Arabia, the Act stipulates that upon enactment of the Act, the third party
screening program in Saudi Arabia will terminate, but on-site personnel of the DHS
shall review all visa applications prior to adjudication there.
The Homeland Security Act of 2002 does not alter the current authority for the
Department of State to use machine readable visa fees in its expenditures. State’s
total allocation of machine readable visa fees in FY2001 was $395.3 million; in
FY2002 it was $443 million; the FY2003 estimate is $635.6 million; and the
FY2004 request is for $736 million. The fees are typically used for State Department
border security programs, technology, and personnel. Some are questioning wether
the FY2003 estimate and the FY2004 request are attainable in these years where visa
issuance is down and a war seems imminent.

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Table 1. State Department and Related Agencies Appropriations
(millions of dollars)
FY2002
FY2002
supp
approps
Post-9/11
(P.L. 107-
FY2003
Supp.
FY2004
House
Senate
enacted
supps
206)
enacted
P.L. 108-11
request
Bill
Bill
State Department
Diplomatic & Consular Program
3,630.0
136.0
47.5
3,822.3
98.4
4,163.5
4,100.0
Public Diplomacy
(270.3)
(15.0)
(10.0)
(292.7)
Worldwide Security Upgrades
(487.7)
(553.0)
(646.7)
Ed & cultural exchange prog. (USIA)
237.0
15.0
245.3
345.3
345.3
Office of Inspector General
29.0
29.3
31.7
29.8
Representation allowances
6.5
6.5
9.0
9.0
Protec.-missions & officials
9.4
11.0
10.0
10.0
Embassy security/constr/maintenance
1,274.0
52.9
210.5
508.5
149.5
653.0
532.9
Worldwide security upgrades
(816.0)
755.0
861.4
861.4
Emergency-diplo. & consular services
6.5
51.0
6.5
50.0
1.0
1.0
Repatriation loans
1.2
1.2
1.2
1.2
Payment American Inst. Taiwan
17.0
18.5
19.8
18.8
Foreign Service Retirement Fund
135.6
138.2
135.0
135.0
Capitol Investment Fund
203.0
15.0
183.3
157.0
142.0
Total, Administration of Foreign Affairs
5,549.2
254.9
273.0
5,725.6
297.9
6,387.9
6,186.4
International Organ. & Conf.
Contributions to international organizations
850.0
7.0
866.0
1,010.5
1,010.5
Contributions to international peacekeeping
844.1
23.0
673.7
550.2
550.2
Total International Organ. & Conf.
1,694.1
30.0
1,539.7
1,560.7
1,560.7
Total International Commissions
60.5
57.5
71.7
57.1

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CRS-9
FY2002
FY2002
supp
approps
Post-9/11
(P.L. 107-
FY2003
Supp.
FY2004
House
Senate
enacted
supps
206)
enacted
P.L. 108-11
request
Bill
Bill
Related Appropriations
The Asia Foundation
9.3
10.4
9.3
10.4
National Endowment for Democracy
33.5
42.0
36.0
42.0
East-West Center
14.0
18.0
14.3
-.-
Eisenhower Exchange
0.5
0.5
0.5
0.5
Israeli Arab Scholarship
0.4
0.4
0.4
0.4
Total Related Appropriations
57.7
71.3
60.4
53.3
Total State Department
7,361.5
254.9
303.0
7,394.1
8,080.7
7,857.4
International Broadcasting
Capital Improvements
25.9
26.4
7.7
12.7
11.4
11.4
Broadcasting Operations
428.2
21.5
7.4
468.9
30.5
525.2
552.1
Broadcasting to Cuba
24.9
25.0
26.9
-.-
Total International Broadcasting
479.0
47.9
15.1
506.6
30.5
563.5
563.5
TOTAL State & Broadcasting
7,840.5
302.8
318.1
7,900.7
328.4
8,644.2
8,420.9
Note: The FY2003 numbers in this table do not include the 0.65% across-the-board rescission included in P.L. 108-7.
* H.R. 247 was introduced by Congressman Frank Wolf, Chairman of the House Appropriations Subcommittee on Commerce, Justice, and State to serve as a House baseline for CJS
numbers in conference. No other congressional action occurred on the bill.

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