Appropriations for FY2005: Labor, Health and Human Services, and Education

Contents

• Most Recent Developments
• P.L. 108-447 (H.R. 4818) Enacted
• Senate Bill S. 2810 Reported
• House Bill H.R. 5006 Passed
• President's Budget Submitted
• Note on Most Recent Data
• Summary and Key Issues
• Program Level and Current Year Appropriations
• President's Request
• House Bill
• Senate Bill
• Public Law
• "Across-the-Board" Reductions for FY2005
• FY2005 Funding Highlights
• Earmarks for Specific Projects
• 302(a) and 302(b) Allocation Ceilings
• Advance Appropriations
• Major Funding Trends
• Department of Labor
• Key Issues
• President's Request
• House Bill
• Senate Bill
• Public Law
• Overtime Pay Regulation
• CRS Products
• Websites
• Detailed Appropriations Table
• Department of Health and Human Services
• Key Issues
• President's Request
• House Bill
• Senate Bill
• Public Law
• Abortion: Funding Restrictions
• Embryonic Stem Cell Research: Funding Restrictions
• CRS Products
• Websites
• Detailed Appropriations Table
• Department of Education
• Key Issues
• President's Request
• House Bill
• Senate Bill
• Public Law
• IDEA Part B Grants to States
• Pell Grants
• Forward Funding and Advance Appropriations
• CRS Products
• Websites
• Detailed Appropriations Table
• Related Agencies
• Key Issues
• President's Request
• House Bill
• Senate Bill
• Public Law
• CRS Products
• Websites
• Detailed Appropriations Table
• Related Legislation
• FY2005 Continuing Resolution, P.L. 108-309 (H.J.Res. 107)
• FY2005 Supplemental Appropriations for Hurricanes, P.L. 108-324 (H.R. 4837)
• FY2005 Budget Resolution, S.Con.Res. 95/H.Con.Res. 393
• FY2005 Education Appropriations, H.R. 4473
• FY2004 Omnibus Appropriations, P.L. 108-199 (H.R. 2673)
• "Across-the-Board" Reductions for FY2004

Summary

This report tracks the legislative progress of the FY2005 appropriations for the Departments of Labor, Health and Human Services, and Education, and Related Agencies (L-HHS-ED). This legislation provides discretionary funds for three major federal departments and related agencies. The report summarizes L-HHS-ED discretionary funding issues but not authorization or entitlement issues.

On February 2, 2004, the President submitted the FY2005 budget request to the Congress, including $142.9 billion in discretionary L-HHS-ED funds; the comparable FY2004 appropriation was $139.8 billion, enacted primarily through P.L. 108-199. The House and Senate FY2004 proposals—H.R. 5006 (H.Rept. 108-636) and S. 2810 (S.Rept. 108-345), respectively—were combined in Division F of H.R. 4818 (H.Rept. 108-792), the Consolidated Appropriations Act, 2005, to provide $144.0 billion of discretionary L-HHS-ED funds prior to a reduction (see page 8). Three continuing resolutions, beginning with P.L. 108-309, provided temporary FY2005 funding until H.R. 4818 was signed into law on December 8, 2004, as P.L. 108-447.

Department of Labor (DOL): DOL discretionary appropriations were $11.8 billion in FY2004; $12.1 billion is provided for FY2005. Funding is increased by $217 million for the Workforce Investment Act (WIA) programs; $250 million is designated for a WIA Community College Initiative. Restrictions on new DOL overtime regulations were not included in P.L. 108-447.

Department of Health and Human Services (HHS): HHS discretionary appropriations were $62.2 billion in FY2004; $64.2 billion is provided for FY2005. Funding for the National Institutes of Health (NIH) is increased by $800 million. The Community Health Centers, Health Care-related Facilities and Activities, Centers for Disease Control and Prevention (CDC), Low-Income Home Energy Assistance Program (LIHEAP), and Head Start each receive increases of at least $100 million. Abortion restrictions are extended to protect funding for health care entities that do not provide abortion services; this additional restriction has been referred to as the "Weldon Amendment."

Department of Education (ED): ED discretionary appropriations were $55.7 billion in FY2004, $57.0 billion is provided for FY2005. Funding is increased for Title I, Part A Grants to Local Educational Agencies by $500 million, Individuals with Disabilities Education Act (IDEA) Part B Grants to States by $607 million, and Pell Grants by $458 million. Funding for Educational Technology State Grants is reduced by $192 million.

Related Agencies: Discretionary appropriations for related agencies were $10.1 billion in FY2004, $10.6 billion is provided for FY2005. Administrative Expenses of the Social Security Administration (SSA) are increased by $467 million.

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Appropriations for FY2005: Labor, Health and Human Services, and Education

Most Recent Developments

P.L. 108-447 (H.R. 4818) Enacted

Following a series of three continuing resolutions, the Departments of Labor, Health and Human Services, and Education, and Related Agencies (L-HHS-ED) Appropriations Act, 2005, was enacted on December 8, 2004, as Division F of P.L. 108-447, the Consolidated Appropriations Act, 2005 (H.R. 4818, H.Rept. 108-792). Prior to the 0.80% reduction for most discretionary activities (see page 8), the act provides $144.0 billion for L-HHS-ED discretionary programs; the comparable FY2004 amount was $139.8 billion.

Senate Bill S. 2810 Reported

On September 15, 2004, the Senate Committee on Appropriations reported S. 2810 (S.Rept. 108-345). The bill would have provided $145.9 billion in L-HHS-ED discretionary appropriations for FY2005.

House Bill H.R. 5006 Passed

On September 9, 2004, the House amended and approved H.R. 5006 (H.Rept. 108-636), its version of FY2005 bill, which would have provided $143.1 billion in L-HHS-ED discretionary appropriations.

President's Budget Submitted

On February 2, 2004, the President submitted the FY2005 budget to Congress; the request was for $142.9 billion in discretionary funds for L-HHS-ED programs.

Table 1 summarizes the legislative status of FY2005 L-HHS-ED appropriations.

Note on Most Recent Data

In this report, data on FY2004 and FY2005 appropriations are based on the FY2005 L-HHS-ED conference report, H.Rept. 108-792, November 20, 2004. The FY2005 House appropriations represent the H.R. 5006 amounts approved by the House on September 9, 2004; the FY2005 Senate appropriations represent the S. 2810 amounts reported by the Senate Committee on Appropriations on September 15, 2004. The FY2005 conference amounts are pre-reduction and do not take into account the cuts (see page 8) required elsewhere in P.L. 108-447, the Consolidated Appropriations Act, 2005. The FY2004 amounts are post-reduction and primarily are based on the Consolidated Appropriations Act, 2004, P.L. 108-199 (see page 43). In most cases, data represent net funding for specific programs and activities and take into account current and forward funding and advance appropriations; however, all data are subject to additional budgetary scorekeeping. Except where noted, budget data refer only to those programs within the purview of the L-HHS-ED appropriations bill, and not to all programs within the jurisdiction of the relevant departments and agencies, including funding from other appropriations bills and entitlements funded outside of the annual appropriations process.

Summary and Key Issues

This report describes the President's proposal for FY2005 appropriations for L-HHS-ED programs, as submitted to the Congress February 2, 2004, and the congressional response to that proposal. It compares the President's FY2005 request to the FY2004 L-HHS-ED amounts. It tracks legislative action and congressional issues related to the FY2005 L-HHS-ED appropriations bill, with particular attention paid to discretionary programs. In addition, the report summarizes activities related to the annual budget process, such as the congressional budget resolution, continuing resolutions, and supplemental appropriations (see "Related Legislation"). However, the report does not follow specific funding issues related to mandatory L-HHS-ED programs—such as Medicare or Social Security—nor will it follow the authorizing legislation associated with funding some of the President's initiatives. For a glossary of budget terms and relevant websites, see Appendix A. For funding resources for L-HHS-ED agencies, see Appendix B.

The L-HHS-ED bill typically is one of the more controversial of the 13 regular appropriations bills, not only because of the size of its funding total and the scope of its programs, but also because of the continuing importance of various related issues, such as restrictions on the use of federal funds for abortion, stem cell research, and human cloning, or modifications of overtime pay regulations. This bill provides most of the discretionary funds for three federal departments and several related agencies including the Social Security Administration (SSA). Of the 13 annual appropriations bills, the L-HHS-ED bill is the largest single source of discretionary funds for domestic federal programs; the Defense bill is the largest source of discretionary funds among all federal programs. For FY2004, the L-HHS-ED bill accounted for $140.9 billion (17.9%) and the Defense bill accounted for $336.1 billion (46.5%) of the estimated $787.3 billion total for all federal discretionary budget authority, as reported in Budget of the United States Government Fiscal Year 2005, Table S-5. This section summarizes major funding changes proposed for L-HHS-ED and related issues such as 302(b) allocations, advance appropriations, and earmarks for specific projects. Later sections provide additional details for each L-HHS-ED department.

Program Level and Current Year Appropriations

Table 2 summarizes the L-HHS-ED appropriations for FY2005, including both discretionary and mandatory appropriations. The table shows various aggregate measures of final FY2004 and proposed FY2005 L-HHS-ED appropriations, including discretionary program level, current year, and advance appropriations, as well as scorekeeping adjustments.

• Program level appropriations reflect the total discretionary appropriations in a given bill, regardless of the year in which they will be spent, and therefore include advance funding for future years. Unless otherwise specified, appropriations levels in this report refer to program level amounts.
• Current year appropriations represent discretionary appropriations in a given bill for the current year, plus discretionary appropriations for the current year that were enacted in prior years. Current year discretionary appropriations are similar to the amount counted for the 302(b) allocations ceilings (discussed later, page 11).
• Advance appropriations are funds that will not become available until after the fiscal year for which the appropriations are enacted—for example, funds included in the FY2004 act that cannot be spent before FY2005 at the earliest (discussed later, page 12).
• Scorekeeping adjustments are made to account for special funding situations; the Congressional Budget Office (CBO) monitors these adjustments.

Because appropriations may consist of mixtures of budget authority enacted in various years, two summary measures are frequently used—program level appropriations and current year appropriations. How are these measures related? For an "operational definition," program level funding equals (a) current year, plus (b) advances for future years, minus (c) advances from prior years, and minus (d) scorekeeping adjustments. Table 2 shows these amounts, along with current year funding for mandatory programs and some grand totals for the L-HHS-ED bill.

President's Request

The President's FY2005 request was submitted to Congress on February 2, 2004, less than two weeks after the regular FY2004 L-HHS-ED appropriations were signed into law as P.L. 108-199 (enacted January 23, 2004). With regard to the President's budget, the primary issues raised during congressional consideration of any appropriations request generally relate to proposed funding changes. The summary below notes changes proposed for FY2005 discretionary budget authority of at least $100 million compared to the FY2004 amount. Viewing this list by itself should be done with caution, since the relative impact of a $100 million funding change to a $500 million program (a 20% increase or decrease) is greater than a $100 million change to a $5 billion program (a 2% increase or decrease). Later in this report, the discussions of budgets for individual departments include tables to compare the FY2005 request with the FY2004 funding for many of the major programs in the L-HHS-ED bill.

Budget Highlights

Overall, $142.9 billion in discretionary appropriations at the program level was requested for L-HHS-ED for FY2005, a 2.2% increase over the comparable FY2004 amount of $139.8 billion.

• For Department of Labor (DOL) programs, the FY2005 request included an increase of $181 million for job training programs authorized by the Workforce Investment Act of 1998 (WIA). A WIA Community College Initiative was proposed at $250 million, and two other initiatives totaled $90 million; funding for existing WIA programs would be reduced by $159 million. Overall, $12.0 billion in FY2005 discretionary appropriations was requested for DOL, a 1.7% increase compared to the FY2004 amount of $11.8 billion.
• For Department of Health and Human Services (HHS) programs, the request proposed an increase of $727 million for the National Institutes of Health (NIH). An additional $219 million was proposed for Community Health Centers. Other increases included an additional $195 million for the Substance Abuse and Mental Health Services Administration (SAMHSA), $109 million for the Centers for Medicare and Medicaid Services (CMS) Program Management, $112 million for the Low-Income Home Energy Assistance Program (LIHEAP), $169 million for Head Start, $112 million for Abstinence Education, and $101 million for the Safe and Stable Families discretionary activities. Requested decreases included reductions of $283 million for Health Professions other than nursing, $153 million for the Centers for Disease Control and Prevention (CDC), and $147 million for the Community Services Block Grant (CSBG). The request would eliminate the $372 million Health Care-related Facilities and Activities program. Overall, $63.2 billion in FY2005 discretionary appropriations was requested for HHS, a 1.6% increase over the FY2004 amount of $62.2 billion.
• For Department of Education (ED) programs, an increase of $0.5 billion was proposed for Elementary and Secondary Education Act of 1965 (ESEA) programs in aggregate. The request proposed increases of $1.0 billion for ESEA Title I, Part A Grants to Local Educational Agencies (LEAs) for the Education of the Disadvantaged, $1.0 billion for Special Education Part B Grants to States under the Individuals with Disabilities Education Act (IDEA), and $0.8 billion for Pell Grants. In addition, $101 million more was proposed for Reading First State Grants, $100 million for a Striving Readers Initiative, and $120 million more for Mathematics and Science Partnerships. Proposed decreases included reductions of $260 million for the Fund for the Improvement of Education (FIE), $316 million for the Perkins Vocational Education program, and $126 million for the Fund for the Improvement of Postsecondary Education (FIPSE). Elimination of funding was proposed for the $247 million Even Start program, the $234 million Comprehensive School Reform Demonstration, and the $174 million Smaller Learning Communities programs. A discretionary funding increase of $818 million was requested to support the creation of a unified discretionary account for the administration of federal student aid programs. This proposal would have been offset in part by a savings of $795 million from the consolidation of certain related expenses for student aid administrative activities. Overall, $57.3 billion in FY2005 discretionary appropriations was requested for ED, a 2.9% increase over the FY2004 amount of $55.7 billion.
• For the related agencies, the budget proposed an increase of $520 million for Administrative Expenses at the Social Security Administration (SSA), and an initial $100 million for an SSA Medicare Reform Contingency Fund. The budget would not have provided a two-year advance appropriation for the Corporation for Public Broadcasting (CPB) for FY2007. The FY2004 L-HHS-ED bill provided CPB with $400 million for FY2006; the FY2004 CPB funding level was $378 million. Overall, $10.3 billion in FY2005 discretionary appropriations was requested for related agencies, a 2.0% increase over the FY2004 amount of $10.1 billion.

House Bill

The House Committee on Appropriations reported its version of the FY2005 L-HHS-ED appropriations as H.R. 5006 (H.Rept. 108-636) on September 7, 2004. The House amended and passed H.R. 5006 on September 9, 2004.

House Highlights

The House approved 11 amendments on the floor, including a provision to prevent DOL from enforcing some parts of its new overtime rules that took effect August 23, 2004. An additional restriction on the use of federal funds for abortion was added at the committee level. The provision, also included in the conference agreement, prevents federal programs or state or local governments from requiring health care entities to provide or pay for abortions. This prohibition has been referred to as the "Weldon Amendment" (H.Rept. 108-792, p. 1271).

Overall, the House bill would have provided program level discretionary appropriations of $143.1 billion for L-HHS-ED programs for FY2005. The President requested $142.9 billion; the FY2004 comparable amount was $139.8 billion. The House bill differs from the President's request for discretionary appropriations in a number of details.

• For DOL programs, the House bill would have funded WIA programs in aggregate at a level that would be $213 million less than requested and $32 million less than provided in FY2004. Included in the WIA total was up to $50 million for the Community College Initiative. Overall, the bill would have provided $11.7 billion in discretionary appropriations for DOL programs, $0.3 billion less than requested and $0.1 billion less than in FY2004.
• For HHS programs, the House bill would have funded Health Professions activities other than nursing at a level that would have been $258 million less than requested, and SAMHSA would have received $159 million less than requested. The bill would have provided the CSBG with $133 million more than requested, and the Public Health and Social Services Emergency Fund (PHSSEF) would have received $127 million more. Overall, the bill would have provided $63.2 billion in discretionary appropriations for HHS programs, the same as requested and $1.0 billion more than in FY2004.
• For ED programs, the House bill would have funded ESEA programs in aggregate at a level $141 million less than requested. Even Start would have been funded at $247 million and Smaller Learning Communities at $101 million; zero funding was requested for both programs. The Innovative Education Block Grant would have been eliminated; $297 million was requested. The Perkins Vocational Education programs would have been funded at $322 million more than requested. The House bill would not have approved the President's request for the administrative reclassification of student loans. Overall, the bill would have provided $57.7 billion in discretionary appropriations for ED programs, $0.4 billion more than requested, and $2.0 billion more than in FY2004.
• For the related agencies, the House bill would have provided a two-year advance appropriation of $400 million for the CPB, which would not have received funding under the request. No funds would have been provided for the SSA Medicare Reform Contingency Fund initiative; initial funding of $100 million was requested. Overall, the bill would have provided $10.5 billion in discretionary appropriations for related agencies, $0.2 billion more than requested and $0.4 billion more than in FY2004.

Senate Bill

The Senate Committee on Appropriations reported its version of the FY2005 L-HHS-ED appropriations as S. 2810 (S.Rept. 108-345) on September 15, 2004.

Senate Highlights

The Senate version of L-HHS-ED appropriations for FY2005, as reported, includes a provision similar to the House provision to prevent DOL from enforcing some parts of its new overtime rules that took effect August 23, 2004. Unlike the House bill, the Senate bill would not modify any existing restrictions on federal funding for abortion.

Overall, the Senate bill would have provided program level discretionary appropriations of $145.9 billion for L-HHS-ED programs for FY2005. The comparable House amount is $143.1 billion, and the President requested $142.9 billion. The FY2004 comparable amount was $139.8 billion. The Senate bill differs from the House bill for discretionary appropriations in a number of details.

• For DOL programs, the Senate bill would have funded WIA programs in aggregate at a level $265 million higher than the House amount. The WIA Community College Initiative would have received a total of $250 million; the House bill would have allowed, but not required, expenditures up to $50 million. Overall, the bill would have provided $12.2 billion in discretionary appropriations for DOL programs, $0.5 billion more than the House, $0.2 billion more than requested, and $0.4 billion more than in FY2004.
• For HHS programs, the Senate bill would have provided $372 million more than the House bill for Health Care-related Facilities and Activities, $310 million for the CDC, and $373 million more for NIH. Unlike the House bill, the Senate would not have moved the Weatherization Assistance program from the FY2005 Interior appropriations to the L-HHS-ED bill. Overall, the Senate bill would have provided $64.5 billion in discretionary appropriations for HHS programs, $1.3 billion more than under the House bill or the request, and $2.3 billion more than in FY2004.
• For ED programs, the Senate bill would have provided $746 million more than the House bill for ESEA programs in aggregate, $116 million more for ESEA Title I Part A Grants to LEAs, $154 million more for Comprehensive School Reform Demonstration, $347 million more for FIE, $161 million more for IDEA Part B Grants to States, and $126 million more for the Fund for the Improvement of Postsecondary Education (FIPSE). The Senate bill would have eliminated the Even Start program; the House bill would have provided $227 million. Overall, the Senate bill would have provided $58.8 billion in discretionary appropriations for ED programs, $1.1 billion more than the House, $1.5 billion more than requested, and $3.1 billion more than in FY2004.
• For the related agencies, the Senate bill would have provided $116 million less than the House bill for the SSA Limitation on Administrative Expenses. Overall, the Senate bill would have provided $10.5 billion in discretionary appropriations for related agencies, the same as the House bill, $0.2 billion more than requested, and $0.4 billion more than in FY2004.

Public Law

H.R. 4818, the Consolidated Appropriations Act, 2005, was signed into law on December 8, 2004, as P.L. 108-447. This act combined the remaining nine FY2005 appropriations bills that had not yet been enacted into a single, omnibus bill. Division F of P.L. 108-447 is the "Departments of Labor, Health and Human Services, and Education, and Related Agencies Appropriations Act, 2005." Division J, "Other Matters," includes additional L-HHS-ED funds in Section 119. The House approved the H.R. 4818 conference report, H.Rept. 108-792, on November 20, 2004, by a vote of 344 to 51, 1 present (Roll Call No. 542); on the same day, the Senate approved the FY2005 conference report by a vote of 65 to 30 (Roll Call No. 215). The conference report on H.R. 4818 was held at the desk in the Senate until December 6, 2004, when the House and Senate reached agreement on H.Con.Res. 528, a resolution to make specific changes to the enrollment of H.R. 4818.¹

"Across-the-Board" Reductions for FY2005

In an effort to meet the overall spending limitations requested by the President, the H.R. 4818 conferees required a reduction to some appropriations from what would have been provided otherwise. The provision is included in P.L. 108-447, Division J, Section 122. It requires a decrease of 0.80% in FY2005 discretionary appropriations for each program, project, or activity, whether enacted in P.L. 108-447 or in other appropriations measures. Discretionary funds from Defense, Military Construction, and Homeland Security appropriations are excluded, as are all FY2005 supplemental appropriations. Advance appropriations enacted through P.L. 108-447 for FY2006 or beyond would be excluded as well. This reduction has been estimated to save approximately $3.5 billion; for additional information, please see CRS Report RS21983, FY2005 Consolidated Appropriations Act: Reference Guide (pdf).

The 0.80% reduction is in addition to several other reductions in P.L. 108-447, including $18 million in administrative expenses for L-HHS-ED programs required by Section 519 of the L-HHS-ED part of the bill, and reductions required in other divisions of P.L. 108-447 that are not germane to L-HHS-ED programs. The actual application of these reductions to individual accounts and line items would be determined by the Office of Management and Budget (OMB) and by the individual agencies. Neither OMB nor the agencies are required to publish tables listing the required reductions to each program. The FY2005 conference data in this report are based on the stated funding levels, and are unadjusted by the application of the required reduction procedures, as the exact reduction for each program was not specified by Congress.

FY2005 Funding Highlights

Several L-HHS-ED programs receive FY2005 funding above the comparable FY2004 amount, including some above the President's FY2005 request. A few programs receive funding below the FY2004 level. Overall, as shown in Table 2, the FY2005 discretionary amount at the program level is $144.0 billion, prior to the offsets required elsewhere in the conference agreement. The FY2005 amount is $4.2 billion (3.0%) more than the FY2004 amount of $139.8 billion; the President requested $142.9 billion for FY2005. Compared to FY2004 funding levels, the FY2005 appropriations are increased or decreased by at least $100 million for the following programs; additional details and funding amounts are provided in the separate agency summaries.

• For DOL, funding changes of at least $100 million occurred only for WIA programs in aggregate, with an increase of $217 million; the WIA total includes $250 million for the initial funding of the WIA Community College Initiative. Overall, the conference agreement provides $12.1 billion for DOL discretionary activities, $0.3 billion more than the FY2004 amount.
• For HHS, compared to FY2004 appropriations, $131 million more is provided for Community Health Centers, $113 million more for Health Care-related Facilities and Activities, $167 million more for the CDC, $800 million more for the NIH, $311 million more for LIHEAP, and $124 million more for Head Start. Overall, the conference agreement provides $64.2 billion in discretionary appropriations, $2.0 billion more than in FY2004.
• For ED, funding is increased by $270 million for ESEA in aggregate, $500 million for ESEA Title I Part A Grants to LEAs, $607 million for IDEA Part B Grants to States, and $458 million for Pell Grants. Educational Technology State Grants are decreased by $192 million. Overall, the conference agreement provides $57.0 billion in discretionary appropriations for ED, $1.3 billion more than was provided in FY2004.
• For Related Agencies, the SSA Limitation on Administrative Expenses is increased by $467 million compared to FY2004. Overall, the conference agreement provides $10.6 billion in discretionary appropriations for the L-HHS-ED related agencies, $0.5 billion more than in FY2004.

Modification of Existing Programs and Activities

In addition to enacting appropriations, P.L. 108-447 modifies several programs and activities and amends provisions that govern the use of appropriated funds for L-HHS-ED.

• Section 106 requires the return to a traditional format for FY2006 DOL congressional budget justifications; report language suggests that program performance and measurement information should be provided in a separate appendix rather mixed in with more traditional budget material.
• Section 213 extends the refugee status for certain persecuted religious minority groups from Iran.
• Section 219 delays enforcement of a new HHS regulation concerning Medicare's classification of certain hospitals as inpatient rehabilitation facilities until the completion of an already mandated study by the Government Accountability Office (GAO). These compliance thresholds—commonly known as the "75% rule"—have been a source of concern among the provider community. For further information, please see CRS Report RL32640, Medicare Payment Issues Affecting Inpatient Rehabilitation Facilities (IRFs).
• Section 307 clarifies student eligibility for Pell Grants for students who are enrolled at institutions in Palau.
• Section 508 expands previous abortion restrictions to prevent federal programs or state or local governments from requiring health care entities to provide or pay for abortions. This new prohibition has been referred to as the "Weldon Amendment" (H.Rept. 108-792, p. 1271).
• Section 517 prohibits the obligation of reprogrammed L-HHS-ED funds for a number of specific activities, including the initiation of new programs and the elimination of existing programs, projects, or activities. Any other reprogramming requires advance notification of House and Senate Appropriation Committees; dollar and percentage limitations for reprogramming are also specified.

Provisions not Included

Several general provisions were considered during preliminary stages of the FY2005 appropriations process but were eliminated in the final FY2005 L-HHS-ED conference agreement. These proposals include: a restriction on new DOL overtime rules; a prohibition on the ED administration of a special allowance for 9.5% loans in higher education; a prohibition on certain ED activities related to the Illegal Immigration Reform and Responsibility Act of 1966; and a provision related to the consolidation of student loans.

Earmarks for Specific Projects

The earmarking of funds for specific projects in appropriations bills has become a topic of contention for the Congress and the Administration, and the issue extends to L-HHS-ED projects. In the case of L-HHS-ED appropriations, earmarks may be defined as "funds set aside within an account for a specific organization or location, either in the appropriation act or its conference report." Typically, the authorizing statute gives the general purpose for use of appropriations, such as "projects for the improvement of postsecondary education," but an earmark designates a specific amount for a specific recipient. Such designations bypass the usual competitive distribution of awards by a federal agency, but otherwise require recipients to follow standard federal financial and other administrative procedures. The President has urged the elimination of congressional earmarks in appropriations in recent years, but the Congress has continued the practice.

Earmarks in L-HHS-ED appropriations generally have increased during the past decade, along with the total appropriation for L-HHS-ED programs. Table 3 shows the total annual L-HHS-ED appropriation, the estimated amount earmarked, the earmarked amount as a percent of the total, and the estimated number of earmarks.

302(a) and 302(b) Allocation Ceilings

The maximum budget authority for annual L-HHS-ED appropriations is determined through a two-stage congressional budget process. In the first stage, the Congress agrees to overall spending totals in the annual concurrent resolution on the budget. Subsequently, these amounts are allocated among the various committees, usually through the statement of managers for the conference report on the budget resolution. In years when the House and Senate do not reach a budget agreement, spending totals may be set through leadership arrangements in each chamber. These overall spending totals are known as the 302(a) allocations. These allocations are the discretionary totals available to the House and Senate Committees on Appropriations for enactment in annual appropriations.

For FY2005, the House agreed to a conference report on an FY2005 budget resolution, S.Con.Res. 95 (H.Rept. 108-500) on May 19, 2004; the Senate has yet to act directly on that resolution. If agreed to by both House and Senate, the conference report would establish $821 billion as the 302(a) allocation ceiling for the total discretionary budget authority for FY2005. H.Res. 649, the rule agreed to by the House for the floor consideration of S.Con.Res. 95, "deems" the amount from the conference report to be the ceiling for the House, pending approval of a budget resolution by both House and Senate. However, §14007 of P.L. 108-287, the Department of Defense Appropriations Act, 2005, also establishes a 302(a) allocation for the Senate of $821 billion, pending approval of a budget resolution by both House and Senate. For legislative details, please see "Related Legislation," and CRS Report RL31443, The "Deeming Resolution": A Budget Enforcement Tool. For procedural information, please see CRS Report 98-721, Introduction to the Federal Budget Process.

In the second stage of the congressional budget process, the appropriations committees allocate the 302(a) discretionary funds among their subcommittees for each of the 13 annual appropriations bills. These amounts are known as the 302(b) allocations. These allocations must add up to no more than the 302(a) discretionary allocation, and form the basis for enforcing budget discipline, since any bill reported with a total above the ceiling is subject to a point of order. The 302(b) allocations can and often do get adjusted during the year as the various appropriations bills progress toward final enactment. Table 4 shows the 302(b) discretionary allocations for the FY2005 L-HHS-ED appropriations. Comparable amounts for final FY2004 appropriations and the President's FY2005 budget request are also shown. Both the 302(a) and 302(b) allocations regularly become contested issues in their own right.

Advance Appropriations

Advance appropriations occur when funding enacted in one fiscal year cannot be spent until a subsequent fiscal year. For example, P.L. 108-199, which enacted FY2004 L-HHS-ED appropriations, provided $400 million for the Corporation for Public Broadcasting (CPB) for use in FY2006. Advance appropriations may be used to meet several objectives. These might include the provision of long-term budget information to recipients, such as state and local educational systems, to enable better planning of future program activities and personnel levels. The more contentious aspect of advance appropriations, however, involves how they are counted in budget ceilings. Advance appropriations avoid the 302(a) and 302(b) allocation ceilings for the current year, but must be counted in the year in which they first become available for obligation. This procedure uses up ahead of time part of what will be counted against the allocation ceiling in future years. For an example of the impact of advance appropriations on program administration, see discussion in "Department of Education."

The FY1999 and FY2000 annual L-HHS-ED appropriations bills provided significant increases in advance appropriations for discretionary programs. These amounts stabilized at approximately $19 billion in FY2000, increased to $21.5 billion in FY2003, and returned to $19.3 billion in FY2004. For FY2004, the advance appropriations represent approximately 14% of the L-HHS-ED discretionary total of $139.5 billion for that year. In FY2002, the President's budget proposed the elimination of advance appropriations for federal discretionary programs, including those for L-HHS-ED programs. The Congress rejected that proposal, and the proposal has not been repeated. For FY2005, the President's request included L-HHS-ED advance appropriations of $18.9 billion; the FY2005 conference agreement continued advance appropriations at the same level as FY2004, $19.3 billion. From FY1998 to the present, the advance appropriations enacted in L-HHS-ED bills have been as follows:

• FY1998, $4.0 billion;
• FY1999, $8.9 billion;
• FY2000, $19.0 billion;
• FY2001, $18.8 billion;
• FY2002, $19.3 billion;
• FY2003, $21.5 billion;
• FY2004, $19.3 billion;
• FY2005, President's budget request, $18.9 billion;
• FY2005, House bill, $19.3 billion;
• FY2005, Senate bill, $19.3 billion; and
• FY2005, conference agreement, $19.3 billion.

These amounts reflect the implementation of §106 of P.L. 108-84 (H.J.Res. 69), enacted September 30, 2003, which amended FY2003 L-HHS-ED appropriations to reduce the FY2003 advance appropriations for FY2004 by $2.2 billion, and to increase regular FY2003 appropriations by the same amount.

Major Funding Trends

The L-HHS-ED appropriations bills combine mandatory and discretionary funds; however, the Appropriations Committees fully control only the discretionary funds. Mandatory funding levels for programs included in the annual appropriations bills are modified through changes in the authorizing legislation. These changes typically are accomplished through the authorizing committees and combined into large, omnibus reconciliation bills. Table 5 shows the trend in discretionary budget authority under the L-HHS-ED appropriations for FY2000 through FY2004.

During the past five years, L-HHS-ED discretionary funds have grown from $85.4 billion in FY2000 to an estimated $139.5 billion in FY2004, an increase of $54.1 billion, or 63.3%, during this period. After adjustment for inflation by use of the Gross Domestic Product (GDP) deflator, the L-HHS-ED discretionary total has grown from $91.6 billion in (for FY2000 in FY2004 dollars) to an estimated $139.5 billion (for FY2004 in FY2004 dollars), for an increase of $47.9 billion, or 52.3%, during this period. When compared to the federal discretionary total, the L-HHS-ED portion increased from a 14.6% share of the federal total in FY2000 to an estimated 16.0% in FY2004. When compared to all federal budget authority, both discretionary and nondiscretionary (mandatory), the L-HHS-ED portion of the federal total increased during this period from 4.7% in FY2000 to an estimated 5.9% in FY2004.

Department of Labor

The FY2005 budget request for discretionary appropriations at the Department of Labor (DOL) was $12.0 billion, $0.2 billion (1.7%) more than the FY2004 appropriations of $11.8 billion, as shown in Table 6. The House bill would have provided $11.7 billion; as reported, the Senate bill would have provided $12.2 billion. The conference amount, as enacted, is $12.1 billion, prior to the offsets required elsewhere in the conference agreement (see page 8).

Mandatory DOL programs included in the FY2004 L-HHS-ED bill were funded at $3.5 billion, and consist of the Federal Unemployment Benefits and Allowances ($1.3 billion), Black Lung Disability Trust Fund ($1.1 billion), Advances to the Unemployment Insurance and Other Trust Funds ($0.5 billion), Special Benefits for Disabled Coal Miners ($0.4 billion), Employment Standards Administration Special Benefits ($0.2 billion), and Energy Employees Occupational Illness Compensation Fund ($0.1 billion).

Key Issues

President's Request

The President's FY2005 budget request for DOL proposed changes in funding for a number of discretionary activities, but a change of at least $100 million only for programs under the Workforce Investment Act of 1998 (WIA). Aggregate WIA funding would have been increased by $181 million compared to the FY2004 amount of $5.1 billion. However, the request included $250 million for a new WIA Community College Initiative to provide community-based job training grants and $90 million for two other WIA initiatives. For WIA programs that were funded in FY2004, the FY2005 request represented a decrease of $159 million.

House Bill

For DOL programs, the House bill primarily would have differed from the President's budget request with respect to the various WIA programs and proposals. The bill would have provided $5.1 billion in aggregate for WIA in FY2005, $213 million less than requested and $32 million less than provided in FY2004. The bill would have provided up to $50 million for the Community College Initiative, for which $250 million was requested, but would not have funded the other two WIA initiatives for which $90 million was proposed.

Senate Bill

For DOL programs, the Senate bill, as reported, primarily would have differed from the House bill with respect to the various WIA programs and proposals. The Senate bill would have provided $5.4 billion in aggregate for WIA in FY2005, $265 million more than the House amount, and $52 million more than requested; the FY2004 amount was $5.1 billion. The bill would have provided $250 million for the Community College Initiative, the same as the request. However, only $125 million would have been provided directly and $125 million would have been taken from the Secretary's Reserve for the WIA Dislocated Worker program.

Public Law

Under the FY2005 conference agreement, as enacted, a change in funding from FY2004 to FY2005 of at least $100 million occurs only for WIA programs. The aggregate WIA amount is $5.4 billion, $217 million more than the FY2004 amount and $36 million more than requested. The Community College Initiative receives initial funding of $250 million, and, like the Senate bill, $125 million is provided directly and $125 million must be taken from the Secretary's Reserve for the WIA Dislocated Worker program.

Overtime Pay Regulation

Section 13(a)(1) of the Fair Labor Standards Act of 1938 (FLSA) exempts from the act's minimum wage and overtime pay requirements employers of bona fide executive, administrative, or professional employees. To be classified as bona fide, workers must meet two qualifying standards established administratively by the Secretary of Labor: an earnings test or threshold, and a duties test.

On March 31, 2003, after a lengthy period during which the qualifying tests had remained largely static, DOL proposed a revision of both tests; the final rule took effect on August 23, 2004. Under the revised Section 13(a)(1) regulation (29 C.F.R. § 541), workers earning less than $23,660 annually—the minimum ranged between $8,060 and $13,000 under the old rule—automatically have overtime pay protection. Workers likely are exempt if they earn more that $100,000 and perform any executive, administrative, or professional functions. For those workers earning between $23,660 and $100,000, coverage depends upon their specific duties on a case-by-case basis.

The revision proposed by DOL was immediately contentious. While there is general support for an increase in the earnings threshold (it had fallen to a level nearly co-equal with the federal minimum wage), redefining the duties test has been more troublesome. DOL, some contend, has made major changes to the various classifications which, depending upon how they might be interpreted, could significantly expand the concept of an executive or administrator or professional and erode overtime pay protection for a large segment of the workforce. The DOL revision of the duties test remains an issue.

During the House consideration of the FY2005 L-HHS-ED appropriations, Representative Obey proposed an amendment to prevent DOL from implementing the redefinition of the overtime duties test; the increase in the earnings threshold would be permitted. The House agreed to this amendment by a vote of 223 to 193 (Roll Call No. 434) on September 9, 2004. However, the Administration stated that it would strongly oppose such an amendment and would recommend that the President veto the bill if the final version were to contain any restriction on DOL enforcement of its new overtime rule. The House proposal may be found at §521 of the House bill; a similar restriction was included in the Senate bill at §108.

The FY2005 L-HHS-ED conference agreement eliminates all overtime restrictions, allowing DOL to enforce its revised regulations. For further discussion, please see CRS Report RS21946, Overtime Pay: The Department of Labor Initiative and Congressional Response (2003-2004) (pdf), and CRS Report RL32088, The Fair Labor Standards Act: A Historical Sketch of the Overtime Pay Requirements of Section 13(a)(1). For the Statement of Administration Policy against the DOL enforcement prohibition, please see: http://www.whitehouse.gov/omb/legislative/sap/108-2/hr5006sap-h.pdf.

CRS Products

CRS Report RL32088, The Fair Labor Standards Act: A Historical Sketch of the Overtime Pay Requirements of Section 13(a)(1), by [author name scrubbed].

CRS Report RS21946, Overtime Pay: The Department of Labor Initiative and Congressional Response (2003-2004), by [author name scrubbed] (pdf).

CRS Report 95-742, Unemployment Benefits: Legislative Issues in the 108^th Congress, by [author name scrubbed].

CRS Report RS21397, Unemployment Benefits: Temporary Extended Unemployment Compensation (TEUC) Program, by [author name scrubbed].

CRS Report RL32349, The "White-Collar" Exemptions to Overtime Pay Under Current and Proposed Regulations: An Economic Analysis, by [author name scrubbed].

CRS Report RS21484, Workforce Investment Act of 1998 (WIA): Reauthorization of Title I Job Training Programs in the 108^th Congress, by [author name scrubbed].

CRS Report RS20244, The Workforce Investment Act (WIA): Program-by-Program Overview and FY2006 Funding of Title I Training Programs, by [author name scrubbed].

Websites

Department of Labor
http://www.dol.gov
http://www.dol.gov/_sec/budget2005/overview-toc.htm
http://www.doleta.gov/budget/05bud.cfm

Detailed Appropriations Table

Table 7 shows the appropriations details for offices and major programs of DOL.

Department of Health and Human Services

The FY2005 budget request for discretionary appropriations at the Department of Health and Human Services (HHS) was $63.2 billion, $1.0 billion (1.6%) more than the FY2004 appropriations of $62.2 billion, as shown in Table 8. The House bill would have provided $63.2 billion; as reported, the Senate bill would have provided $64.5 billion. The conference amount, as enacted, is $64.2 billion, prior to the offsets required elsewhere in the conference agreement (see page 8).

Mandatory HHS programs included in the L-HHS-ED bill were funded at $298.1 billion in FY2004, and consist primarily of Grants to States for Medicaid ($189.3 billion), Payments to Medicare Trust Funds ($95.1 billion—virtually all of this amount was for Part B Supplementary Medical Insurance), Foster Care and Adoption ($6.8 billion), Family Support Payments to States ($4.5 billion), and Social Services Block Grant ($1.7 billion).

Key Issues

President's Request

The President's FY2005 budget request for HHS focused increased support primarily on medical research, with smaller increases for Community Health Centers and selected substance abuse and children and family services programs. At the same time, it would have reduced funding for programs for selected health professions, health care facilities, and community services.

Discretionary spending increases of at least $100 million were requested for the following programs.

• An increase of $727 million was requested for the National Institutes of Health (NIH), which was funded at $27.8 billion in FY2004, to support activities that maintain and improve health through medical science. Funding for NIH has more than doubled in the past six years, beginning at $13.6 billion in FY1998. For additional information, please see CRS Issue Brief IB10129, Federal Research and Development Funding: FY2005.
• An additional $219 million was proposed for Community Health Centers, which was funded at $1.6 billion in FY2004; however, the $84 million Community Access Program would have been funded at $10 million under the request.
• An increase of $195 million was requested for the Substance Abuse and Mental Health Services Administration (SAMHSA); $3.2 billion was provided for FY2004 for a variety of substance abuse and mental health activities.
• An increase of $109 million was requested for the Centers for Medicare and Medicaid Services (CMS) Program Management for the administration of the Medicare and Medicaid programs; $2.6 billion was the FY2004 amount.
• A increase of $112 million was proposed for the Low-Income Home Energy Assistance Program (LIHEAP); $1.9 billion was provided for FY2004.
• An additional $169 million was requested for Head Start, which was funded at $6.8 billion in FY2004.
• An increase of $112 million was requested for Abstinence Education, which was funded at $70 million in FY2004.
• An additional $101 million was requested for the discretionary portion of the Promoting Safe and Stable Families program; $99 million in discretionary funds was provided for FY2004.

Along with the increases proposed above, the President's FY2005 budget would have decreased or terminated funding for several programs.

• A decrease of $283 million was requested for Health Professions programs other than those for nursing; Health Professions activities other than nursing were funded at $294 million in FY2004.
• The Health Care-related Facilities and Activities program, funded at $372 million in FY2004, would have been eliminated; funds for this program were earmarked for construction and renovation projects for designated recipients.
• The Centers for Disease Control and Prevention (CDC), funded at $4.4 billion in FY2004, would have been reduced by $153 million under the request.
• A decrease of $147 million was requested for the Community Services Block Grant, which was funded at $642 million in FY2004.

House Bill

For HHS programs, the House bill would have differed in several respects from the President's budget request.

• Health Professions activities other than nursing would have received $269 million, $258 million less than requested; $294 million was provided in FY2004.
• SAMHSA would have been funded at $3.3 billion, $159 million less than requested but $36 million above the FY2004 level.
• Community Services Block Grant (CSBG) would have received $628 million, $133 million more than requested but $14 million less than the FY2004 amount.
• The Public Health and Social Services Emergency Fund (PHSSEF) would have been funded at $2.4 billion, $127 million more than requested and $188 million more than in FY2004.

Senate Bill

For HHS programs, the Senate bill, as reported, would have differed in several respects from the House bill.

• Health Care-related Facilities and Activities would have received $372 million under the Senate bill, the same as the FY2004 amount. Funding would have been eliminated under the House bill and the request.
• The CDC would have received $4.5 billion, $310 million more than the House bill and $325 million more than the request; $4.4 billion was the FY2004 amount.
• The NIH would have received $28.9 billion, $373 million more than under the House bill or the request; $27.8 billion was the FY2004 amount.
• The Senate did not agree to the transfer of Weatherization Assistance to the L-HHS-ED bill from Interior appropriations, as proposed in the House bill.

Public Law

Under the FY2005 conference agreement, as enacted, a change in funding from FY2004 to FY2005 of at least $100 million occurs for several HHS programs.

• Community Health Centers are funded at $1.7 billion, $131 million more than in FY2004 but $88 million less than requested.
• Health Care-related Facilities and Activities receives $485 million, $113 million more than in FY2004; no funds were requested.
• The CDC is funded at $4.5 billion, $167 million more than in FY2004 and $320 million more than requested.
• The NIH receives $28.6 billion, $800 million more than the FY2004 amount and $73 million more than the request.
• LIHEAP receives $2.2 billion, $311 million more than in FY2004 and $199 million more than requested.
• Head Start is funded at $6.9 billion, $124 million more than the FY2004 amount but $45 million less than requested.

FY2005 funding for the Weatherization Assistance program was not transferred to L-HHS-ED, as proposed by the House, nor in the Interior appropriations, where it had been funded in previous years. Instead, Weatherization Assistance funds were provided in Division J, "Other Matters," of P.L. 108-447.

The FY2005 conference agreement provides $3.3 billion for SAMHSA, $61 million more than the FY2004 amount, but $134 million less than requested. Report language (H.Rept. 108-792, page 1179) includes $2 million for SAMHSA to expand a Florida pilot study called TeenScreen to screen and treat teenagers at risk for mental, behavioral, or emotional disorders. This demonstration is being expanded in response to the July 2003 final recommendations of the President's New Freedom Commission on Mental Health.

Abortion: Funding Restrictions

Annual L-HHS-ED appropriations regularly contain restrictions that limit—for one year at a time—the circumstances under which federal funds can be used to pay for abortions. The Congress has not actually amended these restrictions since FY1999, but given the perennial volatility of this issue, these provisions may be revisited at any time during consideration of L-HHS-ED appropriations. From FY1977 to FY1993, abortions could be funded only when the life of the mother was endangered. Restrictions on appropriated funds, popularly referred to as the Hyde Amendments, generally apply to all L-HHS-ED funds. Medicaid is the largest program affected. The 103^rd Congress modified the provisions to permit federal funding of abortions in cases of rape or incest. The FY1998 L-HHS-ED appropriations, P.L. 105-78, extended the Hyde provisions to prohibit the use of federal funds to buy managed care packages that include abortion coverage, except in the cases of rape, incest, or life endangerment. For FY1999, the FY1998 Hyde Amendments were continued, along with a clarification to ensure that the restrictions apply to all trust fund programs (namely, Medicare) funded by the FY1999 L-HHS-ED appropriations, P.L. 105-277, as well as an assurance that Medicare + Choice plans cannot require the provision of abortion services. Annual appropriations acts from FY2000 through FY2004 repeated without change the FY1999 funding restrictions.

For the FY2005 L-HHS-ED appropriations, §508(d) of the House bill would have included an additional restriction to prevent federal programs or state or local governments from requiring health care entities to provide or pay for abortions. The Senate bill would not have included such a restriction. The final version of the appropriations measure included the House proposal—sometimes referred to as the "Weldon Amendment" (H.Rept. 108-792, p. 1271)—so that health care entities cannot be required to provide abortion services. Current provisions can be found in §508 of Division F, P.L. 108-447. For additional information, please see CRS Issue Brief IB95095, Abortion: Legislative Response.

Embryonic Stem Cell Research: Funding Restrictions

On August 9, 2001, President Bush announced a decision to use federal funds for research on human embryonic stem cells for the first time, but limited the funding to "existing stem cell lines." Embryonic stem cells have the ability to develop into virtually any cell in the body, and have the potential to treat medical conditions such as diabetes and Parkinson's disease. In response to the President's announcement, the NIH developed a registry of 78 embryonic stem cell lines eligible for use in federally funded research. However, many of these lines were found to be unavailable or unsuitable for research; only 21 of the 78 eligible stem cell lines are currently available for general research purposes. Some scientists are concerned about the quality, longevity, and availability of eligible stem cell lines. Many believe that the advancement of research requires new stem cell lines, possibly including stem cells derived from cloned embryos. The use of stem cells, however, raises ethical issues regarding embryo and fetal tissue research because the embryos are destroyed in order to obtain the cells. Given its potential volatility, the issue may be revisited at any time during consideration of L-HHS-ED appropriations.

An FY1996 appropriations continuing resolution, P.L. 104-99 (§128), prohibited NIH funds from being used for the creation of human embryos for research purposes or for research in which human embryos are destroyed. Since FY1997, annual appropriations acts have extended the prohibition to all L-HHS-ED funds, but the NIH is the agency primarily affected. The restriction, originally introduced by Representative Jay Dickey, has not changed significantly since it was first enacted, and the FY2005 L-HHS-ED appropriations continued the restrictions without change. The current provision can be found in §509 of the FY2005 L-HHS-ED appropriations, Division F of P.L. 108-447. For additional information, please see CRS CRS Report RL31015, Stem Cell Research; CRS Report RL31358, Human Cloning; and CRS Report RS21044, Legal Issues Related to Human Embryonic Stem Cell Research.

CRS Products

CRS Issue Brief IB95095, Abortion: Legislative Response, by Karen J. Lewis, et al.

CRS Report 98-476, AIDS: Ryan White CARE Act, by [author name scrubbed] and [author name scrubbed].

CRS Report RS21044, Legal Issues Related to Human Embryonic Stem Cell Research, by [author name scrubbed].

CRS Report RS20712, Charitable Choice, Faith-Based Initiatives, and TANF, by [author name scrubbed].

CRS Report RL30785, The Child Care and Development Block Grant: Background and Funding, by [author name scrubbed].

CRS Report RL31817, Child Care Issues in the 108^th Congress, by [author name scrubbed].

CRS Report RL31746, Child Welfare Issues in the 108^th Congress, by [author name scrubbed].

CRS Report RL32872, Community Services Block Grants (CSBG): Background and Funding, by [author name scrubbed].

CRS Issue Brief IB10020, Energy Efficiency: Budget, Oil Conservation, and Electricity Conservation Issues, by [author name scrubbed].

CRS Report RL32046, Federal Health Centers Program, by Barbara English.

CRS Issue Brief IB10129, Federal Research and Development Funding: FY2005, by [author name scrubbed].

CRS Report RL30952, Head Start: Background and Issues, by [author name scrubbed].

CRS Report RL33485, U.S. International HIV/AIDS, Tuberculosis, and Malaria Spending: FY2004-FY2008, by [author name scrubbed].

CRS Report RL31358, Human Cloning, by [author name scrubbed] and [author name scrubbed].

CRS Report RL31865, The Low-Income Home Energy Assistance Program (LIHEAP): Program and Funding, by [author name scrubbed].

CRS Report 97-350, Maternal and Child Health Block Grant, by Sharon Kearney Coleman.

CRS Report RL31719, An Overview of the U.S. Public Health System in the Context of Emergency Preparedness, by [author name scrubbed].

CRS Report RL31940, Public Health Service Operating Agencies, by [author name scrubbed].

CRS Report RS20873, Reducing Teen Pregnancy: Adolescent Family Life and Abstinence Education Programs, by [author name scrubbed].

CRS Report 94-953, Social Services Block Grant (Title XX of the Social Security Act), by [author name scrubbed].

CRS Report RL31015, Stem Cell Research, by [author name scrubbed] and Erin Williams.

CRS Report RL33644, Title X (Public Health Service Act) Family Planning Program, by [author name scrubbed].

CRS Report RL31793, Vaccine Policy Issues, by [author name scrubbed].

CRS Report RL30871, Violence Against Women Act: History and Federal Funding, by [author name scrubbed].

CRS Issue Brief IB10140, Welfare Reauthorization: Overview of the Issues, by [author name scrubbed], [author name scrubbed], and [author name scrubbed].

Websites

Department of Health and Human Services
http://www.hhs.gov
http://www.hhs.gov/budget/document.htm

Detailed Appropriations Table

Table 9 shows the appropriations details for offices and major programs of HHS.

Department of Education

The FY2005 budget request for discretionary appropriations at the Department of Education (ED) was $57.3 billion, $1.6 billion (2.9%) more than the FY2004 appropriations of $55.7 billion, as shown in Table 10. The House bill would have provided $57.7 billion; as reported, the Senate bill would have provided $58.8 billion. The conference amount, as enacted, is $57.0 billion, prior to the offsets required elsewhere in the conference agreement (see page 8).

A single mandatory ED program is included in the L-HHS-ED bill; the Vocational Rehabilitation State Grants program was funded at $2.6 billion in FY2004.

Key Issues

President's Request

Increasing federal support for education has been a priority of both the Congress and the White House in recent years. Under the FY2005 budget request, funding for several programs would have been increased, and the total request for ED discretionary funds would have been increased by 2.9%, or $1.6 billion. An increase of $0.5 billion in the aggregate was requested for all programs authorized by the Elementary and Secondary Education Act of 1965 (ESEA). ESEA programs were funded at $24.3 billion in FY2004; their reauthorization was the primary activity of the No Child Left Behind Act of 2001 (NCLBA), P.L. 107-110.

Discretionary spending increases of at least $100 million were requested by the President for the following programs.

• An increase of $1.0 billion was requested for the ESEA Title I, Part A Grants to Local Educational Agencies (LEAs) program for FY2005; this program was funded at $12.3 billion in FY2004.
• An additional $1.0 billion was proposed for Special Education Part B Grants to States program under Individuals with Disabilities Education Act (IDEA), funded at $10.1 billion in FY2004.
• An additional $0.8 billion was requested for the Pell Grant program, which was funded at $12.0 billion in FY2004.
• The FY2005 request included an increase of $818 million to support a unified discretionary account for the administration of federal student aid programs, funded at $117 million in FY2004. This amount would have been offset in part by a savings of $795 million through the consolidation of certain related expenses for student aid administrative activities currently counted elsewhere.
• An increase of $101 million was requested for Reading First State Grants; the program was funded at $1.0 billion in FY2004
• An initial request of $100 million was proposed for the Striving Readers Initiative.
• An additional $120 million was requested for Mathematics and Science Partnerships; the FY2004 amount was $149 million.

Along with the increases proposed above, the President's FY2005 budget would have decreased or terminated funding for several programs.

• The Even Start program would have been terminated under the FY2005 request; it was funded at $247 million in FY2004.
• The Comprehensive School Reform Demonstration program would have been terminated; it was funded at $234 million in FY2004.
• The Fund for the Improvement of Education (FIE) would have been reduced by $260 million; $430 million was provided in FY2004.
• The Perkins Vocational Education program would have been reduced by $316 million; $1.3 billion was provided in FY2004.
• Smaller Learning Communities would have been eliminated; $174 million was the FY2004 amount.
• The Fund for the Improvement of Postsecondary Education (FIPSE) would have been decreased by $126 million; the program was funded at $158 million in FY2004.

House Bill

For ED programs, the House bill would have differed in several respects from the President's budget request.

• ESEA programs in aggregate would have been funded at $24.6 billion in FY2005, $141 million less than requested but $336 million more than the FY2004 amount of $24.3 billion.
• Even Start would have been funded at $227 million, $20 million less than the FY2004 amount; zero funding was requested.
• The Innovative Education Block Grant would have been reduced to $20 million; $297 million was requested, the same as the FY2004 funding level.
• Several Innovation and Improvement activities would have been funded below the requested level, including elimination of the Teaching of Traditional American History program, for which level funding of $119 million had been requested.
• Perkins Vocational Education programs would have been funded at $1.3 billion, $322 million more than requested; $1.3 billion was provided for FY2004.
• Smaller Learning Communities would have been funded at $101 million; no funds were requested, and $174 million was the FY2004 level.
• The House bill would not have approved the administrative reclassification of student loans proposed in the budget request but would have continued funding at approximately FY2004 levels.

Senate Bill

For ED programs, the Senate bill, as reported, would have differed from the House bill in several respects.

• ESEA programs in aggregate would have been funded at $25.3 billion in the Senate bill, $694 million more than in the House bill and $553 million more than requested; the FY2004 amount was $24.3 billion.
• ESEA Title I Part A Grants to LEAs would have received $13.5 billion, $116 million more than under the House bill or the request; the FY2004 amount was $12.3 billion.
• Funding for Even Start would have been eliminated, the same as requested; the House amount is $227 million; $247 million was provided for FY2004.
• Comprehensive School Reform Demonstration would have been funded at $234 million, $154 million more than the House amount and the same as in FY2004; funding would have been eliminated under the request.
• FIE would have been funded at $447 million, $347 million more than the House amount and $277 million more than requested; $430 million was the FY2004 amount.
• IDEA Part B Grants to States would have been funded at $11.2 billion, $161 million more than in the House bill or the request; $10.1 billion was the FY2004 amount.
• FIPSE would have been funded at $158 million, $126 million more than in the House bill or the request; $158 million was the FY2004 amount.

Public Law

Under the FY2005 conference agreement, as enacted, a change in funding from FY2004 to FY2005 of at least $100 million occurs for several ED programs.

• The aggregate funding level for all ESEA programs is $24.6 billion, $270 million more than the FY2004 amount but $206 million less than requested.
• Within the ESEA total, the largest program, Title I Part A Grants to LEAs, is funded at $12.8 billion, $500 million more than in FY2004 but $500 million less than requested.
• Educational Technology State Grants receive $500 million, $192 million less than the FY2004 amount and the request.
• IDEA Part B Grants to States are funded at $10.7 billion, $607 million more than the FY2004 amount but $393 million less than requested.
• Pell Grants receive $12.5 billion, $458 million more than in FY2004 but $365 million less than requested.

IDEA Part B Grants to States

The IDEA is the major federal program providing assistance to states and school districts to help them provide a free appropriate public education to children with disabilities. In 1975, the Congress authorized state payments up to a maximum amount of 40% of the national average per-pupil expenditure (APPE) times the number of children with disabilities ages 3 and above that each state serves. The rationale for this formula was the assumption that the education of children with disabilities cost twice the national APPE—100% more than the "average" child—and the federal share would be up to 40% of the extra cost. Appropriations have never been sufficient to reach the 40% level. Some view this as a promise made that has not yet been kept; others see the maximum federal share as nothing more than an authorization ceiling.

For FY2005, achieving the 40% funding level for IDEA Part B Grants to States would take an estimated $22.3 billion, whereas $10.7 billion has been appropriated. The FY2005 funding represents an estimated 19.0% of the current APPE times the number of children served. An additional $11.6 billion would be necessary to provide the 40% authorized maximum for FY2005. Because of amendments to IDEA made by P.L. 108-446, the Individuals with Disabilities Education Improvement Act of 2004, future maximum grants will be based on changes in APPE and on growth rates in total student population and in students living in poor families. For additional information, please see CRS Report RL32085, Individuals with Disabilities Education Act (IDEA): Current Funding Trends.

Pell Grants

The funding level for Pell Grants has been a continuing issue. The program provides assistance to eligible undergraduate students based on financial need. Aggregate program costs depend largely on the maximum award and the number of eligible recipients. The maximum award is currently set when appropriations are enacted, which is usually before the start of the program year. The exact number and total amount of the Pell awards cannot be determined until all students have claimed an award. Generally, the number of recipients and the amount of the Pell awards are not reconciled until the end of the program year, which occurs after the following year's appropriations have been enacted. Appropriations for Pell Grants make funds available for two full fiscal years to provide administrative flexibility regarding potential shortfalls and surpluses. If the costs of the Pell Grant program exceed the current fiscal year's appropriation, the shortfall is covered by using appropriated monies from the next fiscal year. Similarly, a surplus can be carried forward and used in the following year. As of December 9, 2004, the ED Budget Service estimates that the FY2004 shortfall will be $3.6 billion and that the shortfall will grow to $4.0 billion under the FY2005 funding level. For additional information, please see CRS Report RL31668, Federal Pell Grant Program of the Higher Education Act: Background and Reauthorization.

Forward Funding and Advance Appropriations

Several L-HHS-ED programs, including some of the larger ED programs, have either authorization or appropriations provisions that allow funding flexibility for program years that differ from the federal fiscal year. For example, many of the elementary and secondary education formula grant programs receive appropriations that become available for obligation to the states on July 1 of the same year as the appropriations, and remain available for 15 months through the end of the following fiscal year. That is, FY2005 appropriations for some programs will became available for obligation to the states on July 1, 2005, and will remain available until September 30, 2006. This budgetary procedure is popularly known as "forward" or "multi-year" funding, and is accomplished through funding provisions in the L-HHS-ED appropriations bill.

Forward funding in the case of elementary and secondary education programs was designed to allow additional time for school officials to develop budgets in advance of the beginning of the school year. For Pell Grants for undergraduates, however, aggregate program costs for individual students applying for postsecondary educational assistance cannot be known with certainty ahead of time. Appropriations from one fiscal year primarily support Pell Grants during the following academic year, that is, the FY2005 appropriations would be used primarily to support the 2005-2006 academic year. Unlike elementary and secondary education programs, however, the funds for Pell Grants remain available for obligation for two full fiscal years, as discussed above.

An advance appropriation occurs when the appropriation is provided for a fiscal year beyond the fiscal year for which the appropriation was enacted. In the case of FY2005 appropriations, funds normally would become available October 1, 2004, under regular funding provisions, but will not become available until July 1, 2005, under the forward funding provisions discussed above. However, if the July 1, 2005 forward funding date were to be postponed for obligation by three months—until October 1, 2005—the appropriation would be reclassified as an advance appropriation since the funds would become available only in a subsequent fiscal year, FY2006. For example, the FY2005 budget request for Title I, Part A Grants to LEAs for the Education of the Disadvantaged was $13.3 billion. This amount includes not only forward funding of $6.1 billion (to become available July 1, 2005), but also an advance appropriation of $7.2 billion (to become available October 1, 2005). Like forward funding provisions, these advance appropriations are specified through provisions in the annual appropriations bill.

What is the impact of these changes in funding provisions? At the program or service level, relatively little is changed by the three-month delay in the availability of funds, since most expenditures for a standard school year occur after October 1. At the appropriations level, however, a significant technical difference occurs because forward funding is counted as part of the current fiscal year, and is therefore fully included in the current 302(b) allocation for discretionary appropriations. Under federal budget scorekeeping rules, an advance appropriation is not counted in the 302(b) allocation until the following year. In essence, a three-month change from forward funding to an advance appropriation for a given program allows a one-time shift from the current year to the next year in the scoring of discretionary appropriations. For additional information, please see CRS Report RS20441, Advance Appropriations, Forward Funding, and Advance Funding, and CRS Report 98-720, Manual on the Federal Budget Process (pdf).

CRS Products

CRS Report RL32365, Adult Education and Literacy: Reauthorization Proposals of the 108^th Congress, by [author name scrubbed].

CRS Report RL31618, Campus-Based Student Financial Aid Programs Under the Higher Education Act, by [author name scrubbed].

CRS Report RL31747, The Carl D. Perkins Vocational and Technical Education Act of 1998: Background and Implementation, by [author name scrubbed].

CRS Report RL31487, Education for the Disadvantaged: Overview of ESEA Title I-A Amendments Under the No Child Left Behind Act, by [author name scrubbed].

CRS Report RL31315, Education of Limited English Proficient and Recent Immigrant Students: Provisions in the No Child Left Behind Act of 2001, by [author name scrubbed].

CRS Report RL30448, Even Start Family Literacy Programs: An Overview, by [author name scrubbed].

CRS Report RL31668, Federal Pell Grant Program of the Higher Education Act: Background and Reauthorization, by [author name scrubbed].

CRS Issue Brief IB10097, The Higher Education Act: Reauthorization Status and Issues, by James B. Stedman.

CRS Report RL34119, Impact Aid for Public K-12 Education: Reauthorization Under the Elementary and Secondary Education Act, by [author name scrubbed] and [author name scrubbed].

CRS Report RL32085, Individuals with Disabilities Education Act (IDEA): Current Funding Trends, by [author name scrubbed].

CRS Report RS20366, Individuals with Disabilities Education Act (IDEA): Overview of Major Provisions, by Richard Apling and [author name scrubbed].

CRS Current Legislative Issues: K-12 Education, http://www.congress.gov/erp/legissues/html/isedu5.html.

CRS Report RS21947, K-12 Education Programs: Appropriations Summary, by [author name scrubbed].

CRS Report RL31284, K-12 Education: Highlights of the No Child Left Behind Act of 2001 (P.L. 107-110), coordinated by [author name scrubbed].

CRS Report RL30834, K-12 Teacher Quality: Issues and Legislative Action, by [author name scrubbed].

CRS Report RL31241, Reading First and Early Reading First: Background and Funding, by [author name scrubbed].

CRS Report RL31647, Title III and Title V of the Higher Education Act: Background and Reauthorization Issues, by [author name scrubbed].

CRS Report RS20532, The Safe and Drug-Free Schools and Communities Act: Reauthorization and Appropriations, by [author name scrubbed].

CRS Issue Brief IB98035, School Choice: Current Legislation, by [author name scrubbed].

CRS Report RL31622, Trio and GEAR UP Programs: Status and Issues, by [author name scrubbed].

CRS Report RL31240, 21^st Century Community Learning Centers: Background and Funding, by [author name scrubbed].

Websites

Department of Education
http://www.ed.gov/index.jhtml
http://www.ed.gov/about/overview/budget/budget05/index.html

Detailed Appropriations Table

Table 11 shows the appropriations details for offices and major programs of ED.

Related Agencies

The FY2005 budget request for discretionary appropriations for L-HHS-ED Related Agencies was $10.3 billion, $0.2 billion (2.0%) more than the FY2004 appropriations of $10.1 billion, as shown in Table 12. The House bill would have provided $10.5 billion; as reported, the Senate bill would have provided the same. The conference amount, as enacted, is $10.6 billion, prior to offsets required elsewhere in the conference agreement (see page 8).

Mandatory programs for related agencies included in the L-HHS-ED bill were funded at $35.9 billion in FY2004, virtually all of it for the Supplemental Security Income (SSI) program.

Key Issues

President's Request

The President's FY2005 budget for related agencies would have changed discretionary spending by at least $100 million for several programs.

• The Corporation for Public Broadcasting (CPB) has been provided with a two-year advance appropriation in recent years; the FY2005 L-HHS-ED bill would be anticipated to provide FY2007 funding for the CPB. However, the President's request would not have provided FY2007 funding. An FY2006 appropriation of $400 million has already been enacted (as part of the FY2004 L-HHS-ED bill), and $390 million has been provided for FY2005 (enacted in the FY2003 bill). The FY2004 amount was $378 million, which was enacted in FY2002.
• An increase of $520 million was proposed for the SSA Administrative Expenses, which was funded at $5.2 billion in FY2004.
• An initial $100 million was proposed for an SSA Medicare Reform Contingency Fund initiative for the implementation of the new Medicare prescription drug program enacted by P.L. 108-173.

House Bill

For the related agencies included in the L-HHS-ED bill, the House bill would have differed from the President's budget request by at least $100 million for two programs.

• The two-year advance appropriation for FY2007 for the CPB would have been $400 million under the House bill, the same funding level as the advance funding for FY2006 that has already been enacted; the President requested no additional funds for the CPB for FY2007.
• No funds would have been provided for the SSA Medicare Reform Contingency Fund initiative; initial funding of $100 million was requested for FY2005.

Senate Bill

For related agencies, the Senate bill, as reported, would have differed from the House bill by at least $100 million for one program. The SSA Limitation on Administrative Expenses would have been funded at $5.6 billion, $116 million less than the House amount and $169 million less than requested; the FY2004 amount was $5.2 billion.

Public Law

Under the FY2005 conference agreement, as enacted, a change in funding from FY2004 to FY2005 of at least $100 million occurs for a single program. The SSA Limitation on Administrative Expenses is funded at $5.7 billion, $53 million less than requested but $467 million more than in FY2004.

CRS Products

CRS Report RL31320, Federal Aid to Libraries in the Museum and Library Services Act of 2003, by [author name scrubbed].

CRS Report RL32004, Social Security Benefits for Noncitizens: Current Policy and Legislation, by [author name scrubbed] and [author name scrubbed].

CRS Issue Brief IB98048, Social Security Reform, by [author name scrubbed].

CRS Report RS20419, VISTA and the Senior Volunteer Service Corps: Description and Funding Levels, by [author name scrubbed].

Websites

Note: Not all of the L-HHS-ED related agencies have websites, and not all websites include FY2005 budget information.

Armed Forces Retirement Home
http://www.afrh.gov/DWP/afrh/afrhhome.htm

Committee for Purchase From People Who Are Blind or Severely Disabled
http://www.jwod.gov/jwod/index.html

Corporation for National and Community Service
http://www.cns.gov
http://www.cns.gov/about/budget.html

Corporation for Public Broadcasting
http://www.cpb.org
http://www.cpb.org/about/funding/appropriation.html

Federal Mediation and Conciliation Service
http://www.fmcs.gov/internet/

Institute of Museum and Library Services
http://www.imls.gov

Medicare Payment Advisory Commission
http://www.medpac.gov/

National Commission on Libraries and Information Science
http://www.nclis.gov/

National Council on Disability
http://www.ncd.gov/

National Labor Relations Board
http://www.nlrb.gov/nlrb/home/default.asp

National Mediation Board
http://www.nmb.gov/

Occupational Health and Safety Review Commission
http://www.oshrc.gov/

Railroad Retirement Board
http://www.rrb.gov

Social Security Administration
http://www.ssa.gov

United States Institute of Peace
http://www.usip.org

Detailed Appropriations Table

Table 13 shows the appropriations details for offices and major programs of the L-HHS-ED related agencies.

Related Legislation

Several proposals related to L-HHS-ED appropriations were introduced during the second session of the 108^th Congress, including a series of FY2005 continuing resolutions, FY2005 supplemental appropriations, FY2005 budget resolutions, and a bill to provide FY2005 appropriations for ED. Early in the session, the Senate approved passage of P.L. 108-199, the Consolidated Appropriations Act, 2004, which provided most of the FY2004 appropriations for L-HHS-ED programs.

FY2005 Continuing Resolution, P.L. 108-309 (H.J.Res. 107)

A series of three continuing resolutions—P.L. 108-309, P.L. 108-416, and P.L. 108-434—provided temporary FY2005 appropriations for most ongoing L-HHS-ED programs, including the costs of direct loans and loan guarantees, for the period October 1, 2004, through December 8, 2004. An FY2005 continuing resolution was necessary because the regular L-HHS-ED appropriations were not enacted by the start of FY2005. Funding under the FY2005 continuing resolutions was provided at a rate of operations not to exceed the "current rate," under FY2004 conditions and program authority. New initiatives were prohibited unless otherwise specifically authorized. For programs with high spend-out rates that normally would occur early in the fiscal year, special restrictions prohibited spending levels that would impinge on final funding decisions. For additional information, please see CRS Report RL30343, Continuing Resolutions: Latest Action and Brief Overview of Recent Practices.

• 1^st continuing resolution, P.L. 108-309 (H.J.Res. 107), provided temporary appropriations for the period October 1, 2004, through November 20, 2004, as long as regular appropriations were not enacted sooner (§107 of P.L. 108-309). H.J.Res. 107 was passed by the House and Senate on September 29, 2004, and signed into law by the President on September 30, 2004, as P.L. 108-309.
• 2^nd continuing resolution, P.L. 108-416 (H.J.Res. 114), extended the provisions of P.L. 108-309 through December 3, 2004.
• 3^rd continuing resolution, P.L. 108-434 (H.J.Res. 115), extended the provisions of P.L. 108-309 through December 8, 2004.

P.L. 108-309 included two special provisions related directly to L-HHS-ED activities.

• The HHS Strategic National Stockpile (SNS) was funded for the duration of the resolution at a rate not to exceed the lower of the House-passed ($450 million) or Senate-reported ($400 million) bills (§114). The SNS was funded at $398 million during FY2004 through the Homeland Security Appropriations Act, but administered by the CDC.
• Programs, activities, and functions authorized under the Higher Education Act of 1965 (HEA) through FY2004 were continued for the duration of the resolution (§118 of P.L. 108-309). However, on October 25, 2004, P.L. 108-366 (H.R. 5185) was signed into law, extending all the HEA programs, activities, and functions through the end of FY2005; for additional information, please see CRS Issue Brief IB10097, The Higher Education Act: Reauthorization Status and Issues.

FY2005 Supplemental Appropriations for Hurricanes, P.L. 108-324 (H.R. 4837)

Two supplemental appropriations were enacted in response to a series of hurricanes in the fall of 2004. The first statute, P.L. 108-303 (H.R. 5005), provided $2.0 billion for FY2004, primarily for Hurricanes Charley and Frances. The second statute, P.L. 108-324 (H.R. 4837) provides $14.5 billion for FY2005, primarily for Hurricanes Ivan and Jeanne. For L-HHS-ED activities, P.L. 108-324 includes funds of $50 million for "aging services, social services and health services associated with natural disaster recovery and response efforts" under the Public Health and Social Service Fund (PHSSF) of HHS.

Disaster relief for Hurricanes Ivan and Jeanne was initially considered in a separate bill, H.R. 5212, which passed the House without dissent on October 6, 2004. Subsequently, these provisions were added as Division B of H.R. 4837 (conference report H.Rept. 108-773), the Military Construction Appropriations Act, 2005, which was signed into law by the President on October 13, 2004, as P.L. 108-324. For additional details on disaster relief, please see CRS Report RL32581, Supplemental Appropriations for the 2004 Hurricanes and Other Disasters.

FY2005 Budget Resolution, S.Con.Res. 95/H.Con.Res. 393

The annual concurrent resolution on the budget sets forth the congressional budget.² Among other provisions, the conference agreement on the FY2005 resolution, H.Rept. 108-498, proposes total discretionary budget authority of $821 billion. This total represents an increase of 4.2% from the estimated FY2004 total of $788 billion, according to the summary published by the Senate Committee on the Budget. Report language outlines the funding assumptions made for selected programs that might be used to reach the spending targets. FY2005 discretionary appropriations for specific departments, agencies, and programs, however, are determined only through the enactment of appropriations.

Table 14 shows the assumed levels of discretionary budget authority for budget functions most relevant to L-HHS-ED programs from the FY2005 conference agreement. The Senate version of the FY2005 budget resolution would include a reserve fund for higher education (§302). Under that provision, if the Senate Committee on Health, Education, Labor, and Pensions (HELP) were to report a measure to reauthorize the Higher Education Act of 1965 (HEA), the Chairman of the Senate Committee on the Budget would be authorized to add up to $1.0 billion in new FY2005 budget authority, and $5.0 billion for the period FY2005-FY2009. If HELP were to report a measure to eliminate the accumulated shortfall in Pell Grants, the Chairman would be authorized to add up to $3.7 billion to the total budget authority in the resolution. Under the conference agreement, H.Rept. 108-498, does not include any special provision for the elimination of the Pell Grants shortfall. The agreement would allow an increase of $5.0 billion for HEA reauthorization for the period FY2005 through FY2009, but only if matching offsets are found elsewhere.

S.Con.Res. 95 (without written report) was passed by the Senate on March 12, 2004 (Roll Call no. 58, 51-45). H.Con.Res. 393 (H.Rept. 108-441) was passed by the House on March 25 (Roll Call no. 92, 215-212). On March 29, the House inserted the provisions of H.Con.Res. 393 in S.Con.Res. 95, and agreed to S.Con.Res. 95, as amended. A conference report, H.Rept. 108-498, was passed by the House on May 19, 2004 (Roll Call no. 198, 216-213). For additional information, please see CRS Report RL32264, The Budget for Fiscal Year 2005.

FY2005 Education Appropriations, H.R. 4473

On June 1, 2004, Representative David Obey, Ranking Member of the House Committee on Appropriations, introduced a bill to provide ED appropriations for FY2005. The bill would increase funding compared to the FY2004 levels for selected ED accounts, including increases of $8.3 billion for Education for the Disadvantaged (primarily for Title I, Part A); $1.4 billion for School Improvement; $2.2 billion for Special Education; and $3.3 billion for Student Financial Assistance (primarily for Pell Grants), with the maximum Pell Grant to be increased to $4,500 (from $4,050). The bill would offset these increases by decreasing certain reductions in taxes resulting from the 2001 and 2003 reconciliation acts, P.L. 107-16 and P.L. 108-27, respectively. Specifically, any taxpayer with an adjusted gross income in excess of $1,000,000 would have the reduction decreased by 55.7% in 2004. H.R. 4473, the Educational Opportunity for the 21^st Century Department of Education Appropriations Act, 2005, was jointly referred to the House Committee on Appropriations and the House Committee on Ways and Means.

FY2004 Omnibus Appropriations, P.L. 108-199 (H.R. 2673)

Regular FY2004 funding for L-HHS-ED activities was enacted early in the second session of the 108^th Congress, more than four months after the start of the fiscal year on October 1, 2003. Seven of the 13 regular FY2004 appropriations bills were combined into a single omnibus bill, H.R. 2673; Division E of the omnibus provided funds for L-HHS-ED programs. A series of five continuing resolutions, P.L. 108-84 (H.J.Res. 69), as amended, provided temporary FY2004 funding for most L-HHS-ED programs until regular funding was enacted.

The H.R. 2673 conference report, H.Rept. 108-401, was passed by the House (Roll Call No. 676, 242-176) on December 8, 2003, and by the Senate (Roll Call No. 3, 65-28) on January 22, 2004. It was signed into law by the President on January 23, 2004, as P.L. 108-199, the Consolidated Appropriations Act, 2004. For a guide to the FY2004 omnibus bill, please see CRS Report RS21684, FY2004 Consolidated Appropriations Act: Reference Guide. For information on the FY2004 L-HHS-ED appropriations, please see CRS Report RL31803, Appropriations for FY2004: Labor, Health and Human Services, and Education.

"Across-the-Board" Reductions for FY2004

In a effort to meet the overall spending limitations requested by the President, the H.R. 2674 conferees included two reductions in discretionary appropriations—one for defense, the other for non-defense. These provisions were specified in P.L. 108-199, Division H, "Miscellaneous Appropriations and Offsets," Section 168. The defense reduction required a rescission of $1.8 billion from unobligated balances that remain available from the FY2001 anti-terrorism supplemental, P.L. 107-38; the FY2002 anti-terrorism supplemental, P.L. 107-117; and unobligated balances from any appropriations for the Department of Defense.

The non-defense reduction required a decrease of 0.59% from most domestic discretionary appropriations found in P.L. 108-199, as well as from certain FY2004 appropriations enacted separately and advance appropriations for FY2004 enacted in previous years. This reduction yielded an estimated $2.8 billion (please see Congressional Record, daily edition, December 12, 2003, p. H12812; also see CRS Report RS21684, FY2004 Consolidated Appropriations Act: Reference Guide). For the specified appropriations, the 0.59% reduction must be applied to "each discretionary account and each item of budget authority" and to each program, project, and activity within each such account or item. FY2004 supplemental appropriation acts and discretionary amounts from FY2004 Defense and Military Construction Appropriations Acts were excluded, as were advance appropriations for FY2005 or later that were enacted through P.L. 108-199.

Although the exact percentage of the non-defense reduction procedures was specified, the actual reductions for each account or line item were left for the determination of the Office of Management and Budget (OMB) and the individual agencies. Within 30 days of enactment of the bill, OMB was required to report the amount of each rescission. In addition, Section 515 of the FY2004 L-HHS-ED bill required a $50 million reduction of funds otherwise provided for L-HHS-ED administrative and related expenses on a pro rata basis; these reductions were required to be reported by OMB within 15 days of enactment. As a result, the tables in the H.R. 2673 conference report, H.Rept. 108-401, show pre-reduction levels, whereas the final post-reduction amounts, as approved by OMB, are incorporated into the tables shown in this report.

Appendix A. Terminology and Web Resources

The following items include some of the key budget terms used in this report; they are based on CRS Report 98-720, Manual on the Federal Budget Process (pdf). The websites provide general information on the federal budget and appropriations.

Advance appropriation is budget authority that will become available in a fiscal year beyond the fiscal year for which the appropriations act is enacted; scorekeeping counts the entire amount in the fiscal year it first becomes available for obligation.

Appropriation is budget authority that permits federal agencies to incur obligations and to make payments out of the Treasury for specified purposes. Appropriations represent the amounts that agencies may obligate during the period of time specified in the law. Annual appropriations are provided in appropriations acts; most permanent appropriations are provided in substantive law. Major types of appropriations are regular, supplemental, and continuing.

Budget authority is legal authority to incur financial obligations that normally result in the outlay of federal government funds. Major types of budget authority are appropriations, borrowing authority, and contract authority. Budget authority also includes the subsidy cost to the federal government of direct loans and loan guarantees, estimated on a net present value basis.

Budget resolution is a concurrent resolution passed by both Houses of Congress, but not requiring the signature of the President, setting forth the congressional budget for at least five fiscal years. It includes various budget totals and functional allocations.

Discretionary spending is budget authority provided in annual appropriations acts, other than appropriated entitlements.

Entitlement authority is the authority to make payments to persons, businesses, or governments that meet the eligibility criteria established by law; as such, it represents a legally binding obligation on the part of the federal government. Entitlement authority may be funded by either annual or permanent appropriations acts.

Forward funding is budget authority that becomes available after the beginning of the fiscal year for which the appropriation is enacted and remains available into the next fiscal year; the entire amount is counted or scored in the fiscal year in which it first becomes available.

Mandatory (direct) spending includes (a) budget authority provided in laws other than appropriations; (b) entitlement authority; and (c) the Food Stamp program.

Rescission is the cancellation of budget authority previously enacted.

Scorekeeping is a set of procedures for tracking and reporting on the status of congressional budgetary actions.

Supplemental appropriation is budget authority provided in an appropriations act in addition to regular appropriations already provided.

Websites

General information on budget and appropriations may be found at these websites. Specific L-HHS-ED agency sites are listed in relevant sections of this report.

House Committees
http://appropriations.house.gov/
http://www.house.gov/budget/

Senate Committees
http://appropriations.senate.gov/
http://www.senate.gov/~budget/

Congressional Budget Office (CBO)
http://www.cbo.gov

Congressional Research Service (CRS)
http://www.crs.gov/products/appropriations/apppage.shtml

Government Accountability Office (GAO)
http://www.gao.gov/

Government Printing Office (GPO)
http://www.gpoaccess.gov/usbudget/

Office of Management & Budget (OMB)
http://www.whitehouse.gov/omb/budget/index.html
http://www.whitehouse.gov/omb/legislative/sap/index.html

Appendix B. Context of L-HHS-ED Appropriations

Budget authority for all federal programs has been estimated to be $2,345.3 billion for FY2004. Budget authority for all L-HHS-ED departments and related agencies has been estimated at $1,213.4 billion, or slightly more than half—51.7%—of the federal total. Table B-1 shows funding for the major L-HHS-ED agencies and provides context for the discretionary funding provided by the L-HHS-ED bill—$139.2 billion, or 5.9% of the federal total in FY2004.

Of the $1,213.4 billion for L-HHS-ED agencies, as shown in Table B-1, the L-HHS-ED appropriations subcommittees generally have effective control only over the $139.2 billion in discretionary funds. What accounts for the remaining $1,074.2 billion of L-HHS-ED funds?

First, funding for mandatory programs accounts for more than two-thirds of the L-HHS-ED bill—$331.9 billion, or 14.2% of the FY2004 federal total. Although appropriations are enacted for these mandatory activities annually—these are sometimes called "appropriated entitlements"—in general the amounts provided must be sufficient to cover program obligations and entitlements to beneficiaries. For these programs, as well as the programs funded through trust funds and permanent authorities, most changes in funding levels are made through amendments to authorizing legislation rather than through annual appropriations bills. Federal administrative costs for these programs typically are subject to annual discretionary appropriations, however. For L-HHS-ED agencies, these mandatory programs include Supplemental Security Income, Black Lung Disability payments, Foster Care and Adoption, the Social Services Block Grant, and Vocational Rehabilitation, as well as general (non-earmarked) fund support for Medicare and Medicaid.

Second, other appropriations bills account for a small portion of L-HHS-ED agency funding—$5.1 billion, or 0.2% of the FY2004 federal total. Two HHS agencies are fully funded by other appropriations bills, and three L-HHS-ED programs are partially funded by bills other than L-HHS-ED. The non-L-HHS-ED sources are shown for each of these agencies below.

• The HHS Food and Drug Administration is funded by the Agriculture Appropriations ($1.4 billion in FY2004).
• The HHS Indian Health Service is funded by the Interior Appropriations ($2.9 billion in FY2004).
• The Corporation for National and Community Service (CNCS)—which is funded under related L-HHS-ED agencies—receives funds from the L-HHS-ED bill for programs authorized under the Domestic Volunteer Service Act of 1973 ($354 million); it also receives funds from the FY2004 Veterans Affairs and Housing and Urban Development (VA-HUD) Appropriations for AmeriCorps and other programs authorized by the National Community Service Act ($581 million).
• The Centers for Disease Control and Prevention (CDC) is primarily funded under L-HHS-ED ($4.4 billion in FY2004); it also receives funds under the FY2004 VA-HUD Appropriations for the Agency for Toxic Substances and Disease Registry (ATSDR) ($73 million).
• The National Institutes of Health (NIH) is primarily funded under L-HHS-ED ($27.8 billion in FY2004); it receives additional funds under FY2004 VA-HUD Appropriations for certain environmental health sciences activities ($78 million).

Third, the remaining L-HHS-ED agency funds—an estimated $737.2 billion, or 31.4% of the total FY2004 federal budget—are received automatically without congressional intervention and outside the annual appropriations process. These funds are provided from permanent appropriations and trust funds. The major L-HHS-ED programs in this category include Unemployment Compensation, Medicare, Railroad Retirement, Temporary Assistance for Needy Families (TANF, the welfare assistance program), Student Loans, State Children's Health Insurance, and Social Security benefits.

Jurisdictional Changes Related to L-HHS-ED Appropriations

On June 9, 2004, the House Committee on Appropriations modified the subcommittee jurisdiction of several programs relevant to the L-HHS-ED bill. It moved the U.S. Institute of Peace ($27 million in FY2004) from L-HHS-ED to Commerce-Justice-State appropriations. It transferred two programs to L-HHS-ED: the Weatherization Grants program of the Department of Energy ($227 million in FY2004) from Interior appropriations, and the Committee for Purchase From People Who Are Blind or Severely Disabled ($5 million in FY2004), an independent federal agency, from Transportation-Treasury appropriations. The Senate Committee on Appropriations did not accept any of these changes when it reported the FY2005 L-HHS-ED bill, S. 2810 (S.Rept. 108-345). Subsequently, the conference agreement on H.R. 4818, H.Rept. 108-792, modified the initial House proposal for jurisdictional changes for FY2005, as follows:

• The Committee for Purchase From People Who Are Blind or Severely Disabled is transferred from Transportation-Treasury to L-HHS-ED appropriations.
• The U.S. Institute of Peace is transferred from L-HHS-ED to Commerce-Justice-State appropriations.
• The Weatherization Assistance program of the Department of Energy is transferred from Interior appropriations to Division J, Other Matters, of P.L. 108-447.