Order Code RL33298
CRS Report for Congress
Received through the CRS Web
FY2006 Supplemental Appropriations:
Iraq and Other International Activities;
Additional Hurricane Katrina Relief
Updated May 23, 2006
Paul M. Irwin, Coordinator
Specialist in Social Legislation
Domestic Social Policy Division
Larry Nowels, Coordinator
Specialist in Foreign Affairs
Foreign Affairs, Defense, and Trade Division
Congressional Research Service { The Library of Congress

FY2006 Supplemental Appropriations:
Iraq and Other International Activities;
Additional Hurricane Katrina Relief
Summary
On February 16, 2006, the Administration submitted two separate FY2006
supplemental appropriations requests. The first, totaling $72.4 billion, would fund
ongoing military operations in Iraq and Afghanistan ($67.9 billion), and State
Department operations in Iraq and various foreign aid programs, including additional
assistance for Iraq ($4.2 billion). The other supplemental would provide $19.8
billion for recovery and reconstruction activities in hurricane-affected Gulf Coast
areas. Thus, Congress is considering a combined spending proposal of $92.2 billion.
For the military component of the supplemental, several potential issues may
arise in Congress, including whether DOD’s funding requests for training Afghan and
Iraqi security forces are necessary in light of the pace of implementation, how to
make transparent the DOD assumptions about military personnel levels for active-
duty and reserve forces that underlie the request, whether DOD could better contain
increases in operating costs, and whether DOD’s investment request finances
peacetime as well as wartime needs.
The supplemental proposal for international matters covers a range of activities
that were either not addressed in the regular FY2006 appropriations, address
circumstances that have changed since passage of the regular spending measures, or,
like military operations in Iraq and Afghanistan, have been largely funded through
supplementals rather than incorporated into the “base” of annual, on-going
diplomatic and aid operations. The request of $1.6 billion in Iraq stabilization
assistance would be the first sizable aid package for Baghdad since Congress
approved $18.45 billion in the FY2004 emergency supplemental measure. Other
foreign policy elements include funding for U.S. diplomatic costs in Iraq and
Afghanistan, reconstruction aid for Afghanistan, democracy promotion programs for
Iran, Darfur humanitarian relief and peace implementation aid in Sudan, Pakistan
earthquake reconstruction, Liberia refugee repatriation, and food aid for Africa.
For hurricane recovery, half the funds — $9.9 billion — are designated for the
Department of Homeland Security, mostly for the Federal Emergency Management
Agency (FEMA). The Department of Housing and Urban Development would
receive $4.4 billion, most of which would be used for community planning and
development. DOD would receive $1.8 billion and the Army Corps of Engineers
$1.5 billion, primarily to be used for flood control and coastal emergencies,
procurement, and construction. The Small Business Administration would receive
$1.3 billion for loans to homeowners, renters, and businesses.
On March 17, 2006, the House passed a $91.95 billion supplemental
appropriation measure (H.R. 4939; H.Rept. 109-388), $270 million less than
requested by the Administration. On May 4, the Senate approved its version totaling
$108.9 billion, $16.8 billion more than the request. The President says he will veto
the bill if it exceeds $94.5 billion. This report will be updated to reflect further
congressional action.

Key CRS Policy Staff
Subject
Name
Telephone
E-Mail
Iraq Military Operations & International Affairs Supplemental:
Coordinator for Iraq Military Operations &
Larry Nowels
7-7645
lnowels@crs.loc.gov
International Affairs Supplemental
Department of Defense
Amy Belasco
7-7627
abelasco@crs.loc.gov
Iraq State Department Operations
Susan B. Epstein
7-6678
sepstein@crs.loc.gov
Iraq Reconstruction
Curt Tarnoff
7-7656
ctarnoff@crs.loc.gov
Afghanistan
Kenneth Katzman
7-7612
kkatzman@crs.loc.gov
Iran
Kenneth Katzman
7-7612
kkatzman@crs.loc.gov
Sudan/Darfur
Ted Dagne
7-7646
tdagne@crs.loc.gov
Pakistan
K. Alan Kronstadt
7-5415
akronstadt@crs.loc.gov
Hurricane Recovery Supplemental:
Coordinator for Hurricane Recovery Supplemental Paul M. Irwin
7-7573
pirwin@crs.loc.gov
Agriculture
Ralph Chite
7-7296
rchite@crs.loc.gov
Army Corps of Engineers & Flood Control
Nicole T. Carter
7-0854
ncarter@crs.loc.gov
Community Development Block Grant, Dept. of
Eugene Boyd
7-8689
eboyd@crs.loc.gov
Housing & Urban Development (HUD)
Defense Operation and Maintenance, and
Amy Belasco
7-7627
abelasco@crs.loc.gov
Procurement, Department of Defense
Education hurricane recovery programs
Rebecca R. Skinner
7-6600
rskinner@crs.loc.gov
Federal Emergency Management Agency
Keith Bea
7-8672
kbea@crs.loc.gov
(FEMA), Dept. of Homeland Security
Fish and Wildlife Service, Dept. of the Interior
M. Lynne Corn
7-7267
lcorn@crs.loc.gov
Historic Preservation Fund
Susan Boren
7-6899
sboren@crs.loc.gov
Low-Income Home Energy Assistance Program
Libby Perl
7-7806
eperl@crs.loc.gov
Military Construction
Daniel H. Else
7-4996
delse@crs.loc.gov
National Oceanic and Atmospheric Administration Wayne Morrissey
7-7072
wmorrissey@crs.loc.gov
Small Business Administration (SBA), Disaster
N. Eric Weiss
7-6209
eweiss@crs.loc.gov
Loans Program
Tenant-Based Rental Assistance, HUD
Maggie McCarty
7-2163
mmccarty@crs.loc.gov
Transportation
John Frittelli
7-7033
jfrittelli@crs.loc.gov
Sidath Viranga
Veterans Affairs
7-0623
spanangala@crs.loc.gov
Panangala
Border Security
Blas Nunez-Neto
7-0622
bnunezneto@crs.loc.gov
John Frittelli
7-7033
jfrittelli@crs.loc.gov
Port Security and the DP World Purchase
James K. Jackson
7-7751
jjackson@crs.loc.gov
Pandemic Influenza Preparedness
Sarah A. Lister
7-7320
slister@crs.loc.gov

Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Summary of Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Defense Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Senate Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
House Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
International Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
House Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Senate Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Hurricane Recovery Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Border Security: Administration and Senate Proposals . . . . . . . . . . . . . . . . . . . . 16
American Port Security and the Dubai Ports World Operational Control of Six
U.S. Terminals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Defense Supplemental . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Potential Issues in DOD’s FY2006 Supplemental Request . . . . . . . . . . . . . 22
Afghan and Iraq Security Forces Funds: Obligations Slower
Than Anticipated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Coalition Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Commander’s Emergency Response Program (CERP) . . . . . . . . . . . . 27
Iraq Freedom Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
New Joint Improvised Explosive Device Defeat Fund . . . . . . . . . . . . 27
Military Personnel Request and Visibility of Personnel Plans . . . . . . 28
Operation and Maintenance Funding Rises Substantially in
FY2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Investment Funding Grows in FY2006 Without Clear Overall
Rationale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Research and Development Emphasizes Improvised Explosive
Devices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Military Construction Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Flexibility Issues: Transfer Limits . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Intelligence Community Management Account . . . . . . . . . . . . . . . . . 37
International Affairs Supplemental . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
U.S. Diplomatic Mission Operations in Iraq . . . . . . . . . . . . . . . . . . . . . . . . 40
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Iraq Stabilization Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Afghanistan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Iran . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

Sudan — Darfur and Other Sudan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Darfur Crisis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
The North-South Peace Agreement and Aid for Non-Darfur Sudan . . 52
Pakistan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Other Foreign Assistance Proposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Hurricane Recovery and Disaster Supplemental . . . . . . . . . . . . . . . . . . . . . . . . . 55
Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Department of Agriculture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
National Oceanic and Atmospheric Administration . . . . . . . . . . . . . . . . . . 59
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Small Business Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Disaster Loans Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Defense Department Supplemental for Repairs, Rebuilding, and Help
for Shipbuilders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Who Should Pay for Higher Costs Due to Delays in Shipbuilding . . . 63
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Military Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
Request for Increased Flexibility to Transfer Funds . . . . . . . . . . . . . . 70
Other Funding for Hurricane Damages . . . . . . . . . . . . . . . . . . . . . . . . 70
Army Corps of Engineers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Department of Homeland Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Federal Emergency Management Agency . . . . . . . . . . . . . . . . . . . . . . 74
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Other DHS Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Department of the Interior . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Fish and Wildlife Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
National Park Service, Historic Preservation Fund . . . . . . . . . . . . . . . 76
Other Interior Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Department of Education . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Department of Veterans Affairs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Medical Center, New Orleans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Department of Transportation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Department of Housing and Urban Development . . . . . . . . . . . . . . . . . . . 82
Community Development Block Grants . . . . . . . . . . . . . . . . . . . . . . . 82
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Tenant-Based Rental Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
Other Departments and Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
Department of Justice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
National Aeronautics and Space Administration . . . . . . . . . . . . . . . . . 87

Environmental Protection Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
Armed Forces Retirement Home . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
General Services Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
Low-Income Home Energy Assistance Program . . . . . . . . . . . . . . . . . 88
Other Departments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
Titles Added by the Senate Committee on Appropriations . . . . . . . . . . . . . 89
Pandemic Influenza Prevention and Preparedness . . . . . . . . . . . . . . . . 89
Appendix A — Department of Defense FY2006 War-Related Supplemental
Request and Prior Funding by Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
List of Tables
Table 1. Summary of FY2006 Supplemental Request . . . . . . . . . . . . . . . . . . . . . 3
Table 2. War-Related Defense Amendments: Senate Action . . . . . . . . . . . . . . . 6
Table 3. War-Related Defense Amendments: House Action . . . . . . . . . . . . . . . 9
Table 4. International Amendments: House Action . . . . . . . . . . . . . . . . . . . . . . 10
Table 5. International Amendments: Senate Action . . . . . . . . . . . . . . . . . . . . . . 11
Table 6. Hurricane Recovery Amendments: House Action . . . . . . . . . . . . . . . . 13
Table 7. Hurricane Recovery and Other Domestic Amendments: Senate
Action on Selected Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Table 8. Defense Department War and Occupation Appropriations,
FY2004-FY2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Table 9. Average Monthly DOD Budget Authority for War and Occupation,
FY2005 Enacted-Revised FY2006 Request . . . . . . . . . . . . . . . . . . . . . . . . 23
Table 10. Department of Defense FY2006 War-Related Bridge
Supplemental and FY2006 War-Related Supplemental Request . . . . . . . . 24
Table 11. State Department and Foreign Aid Funds in FY2006
Supplemental . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Table 12. Iraq Supplemental . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Table 13. Afghanistan Supplemental . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Table 14. Sudan Supplemental . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Table 15. Pakistan Supplemental . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Table 16. Summary of FY2006 Supplemental for Hurricane Recovery and
Disaster Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Table 17. FY2006 Disaster Supplemental for Agriculture . . . . . . . . . . . . . . . . . 58
Table 18. FY2006 Hurricane Supplemental for the National
Oceanic and Atmospheric Administration . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Table 19. FY2006 Hurricane Supplemental for Small Business . . . . . . . . . . . . 60
Table 20. FY2006 Hurricane Supplemental for Defense . . . . . . . . . . . . . . . . . . 62
Table 21. FY2006 Hurricane Supplemental for the Army Corps of
Engineers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Table 22. FY2006 Hurricane Supplemental for Homeland Security . . . . . . . . . 73
Table 23. FY2006 Hurricane Supplemental for Interior . . . . . . . . . . . . . . . . . . . 76
Table 24. FY2006 Hurricane Supplemental for Education . . . . . . . . . . . . . . . . . 78
Table 25. FY2006 Hurricane Supplemental for Veterans Affairs . . . . . . . . . . . 79
Table 26. FY2006 Hurricane Supplemental for Transportation . . . . . . . . . . . . . 81
Table 27. FY2006 Hurricane Supplemental for HUD . . . . . . . . . . . . . . . . . . . . 82

Table 28. FY2006 Hurricane Supplemental: Other Departments and
Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86

FY2006 Supplemental Appropriations:
Iraq and Other International Activities;
Additional Hurricane Katrina Relief
Most Recent Developments
On May 18, 2006, during the negotiations by House and Senate conferees
regarding FY2006 supplemental appropriations, the Administration proposed a
second major revision in its February 16 request for FY2006 supplemental funding.
The revision would provide $1.9 billion for emergency protection of the Nation’s
borders. This amount is to be offset by a reduction of $1.9 billion from previously
requested Defense accounts, mainly for procurement, that can be deferred until later.
The Administration says in its May 18 justification that none of the DOD reductions
will affect personnel or operational activities in the war on terror and that several of
the cuts have already been reduced by the House and Senate.
On May 4, 2006, the full Senate approved (77-21) H.R. 4939, a $108.9 billion
emergency supplemental appropriations for military operations in Iraq and
Afghanistan, foreign assistance in support of the war on terror and other international
crises, additional relief for victims of Gulf Coast hurricanes, and other matters. The
measure is $16.8 billion higher than the President’s request and $17 billion larger
than the House-passed bill. The Senate provides $67.7 billion for military operations
in Iraq and Afghanistan,1 $4.45 billion for State Department and foreign assistance
programs, $28.8 billion for hurricane related expenses, and about $9 billion for other
matters, including enhanced security at U.S. borders and ports, agriculture disaster
assistance, and pandemic influenza preparedness. The President, in a message to
Congress on April 25 and in subsequent public remarks, says he will veto any bill
providing more than $92.2 billion, exclusive of supplemental funds for pandemic
influenza preparedness. Including the Senate-proposed pandemic influenza funding
would bring the total that the White House deems acceptable to $94.5 billion.
During six days of debate, the Senate considered numerous amendments that
would both add and reduce funds to the total approved by the Senate Appropriations
1 The actual figure for Defense costs in Iraq and Afghanistan is something less than the
$67.7 billion figure. During floor debate, the Senate passed an amendment by Senator
Gregg providing $1.9 billion for border security operations, offset by a 2.775% unspecified
cut in defense monies for both the Iraq war and Hurricane Katrina. Because the Defense
Department would have discretion to distribute the cut, it is not possible to say what the total
for war costs in the Senate bill would be. If the entire reduction was applied to war
expenditures, the Senate total could be as low as $65.8 billion, or as high as $67.6 billion
if the reduction was taken exclusively from DOD hurricane damage funds. The total for war
costs could also fall somewhere in between this high and low range.

CRS-2
Committee (April 4; S.Rept. 109-230). In total, the Senate approved amendments
adding about $2.5 billion to Committee-reported bill while agreeing to one
amendment eliminating $15 million in spending. The largest add-on was for $2.2
billion requested by the Administration in an April 25 revision of the original
supplemental request to repair levees in New Orleans. The Senate, however, did not
approve the President’s proposal to offset the $2.2 billion with reductions to the
Federal Emergency Management Agency (FEMA) Disaster Relief Fund. Another
four amendments provided an additional $1.2 billion but were offset by cuts in other
spending. The Senate rejected or tabled several other amendments that proposed to
reduce funding for items unrelated to military costs, foreign aid, and hurricane relief.
On April 25, the Administration made an initial revision to its supplemental
request. This revision increases funding for the Army Corps of Engineers by $2.2
billion to assist in post-Katrina recovery efforts; this amount is offset by a $2.2
billion reduction in funding requested for the Federal Emergency Management
Agency (FEMA) Disaster Relief Fund.
On March 17, the House approved a $91.95 billion supplemental appropriation
measure (H.R. 4939; H.Rept. 109-388) for military operations in Iraq and
Afghanistan, foreign assistance in support of the war on terror and other international
crises, and additional relief for victims of Gulf Coast hurricanes. The defense and
international titles total $72.1 billion, while the hurricane portion amounts to $19.1
billion. The measure is $270 million less than requested by the Administration, but
includes $750 million for Low Income Home Energy Assistance not requested by the
President. H.R. 4939 further includes a provision blocking the sale of U.S. port
terminal operations to Dubai Ports World.
Overview
On February 16, 2006, the Administration submitted two separate FY2006
supplemental appropriations requests. The first, totaling $72.4 billion, would fund
ongoing military operations in Iraq and Afghanistan ($67.9 billion), non-DOD
intelligence operations ($0.3 billion), State Department operations in Iraq and various
foreign aid programs, including additional assistance for Iraq ($4.2 billion), and other
counter-terrorism funding for other agencies ($12 million). The other supplemental
would provide $19.8 billion for recovery and reconstruction activities in hurricane-
affected Gulf Coast areas. Subsequently, the White House revised its request on
April 25, proposing an additional $2.2 billion for the Army Corps of Engineers to
assist in post-Katrina recovery efforts, an amount offset by a $2.2 billion reduction
in funding requested for FEMA’s Disaster Relief Fund. Thus, Congress is
considering a combined spending proposal of $92.2 billion, as shown in Table 1.
The request for Iraq and Afghanistan military operations continues the
Administration’s practice of funding these activities through supplementals rather
than in regular DOD appropriations. Congress, however, did approve a $50 billion
bridge fund for Iraq in P.L. 109-148, the Defense Department FY2006 appropriation,
to cover early FY2006 costs of military spending until a supplemental could be
considered by Congress and enacted. Thus, the total amount of existing and

CRS-3
proposed appropriations for military and intelligence operations in Iraq, Afghanistan
and other global war on terrorism for FY2006, is $117.9 billion. This compares to
about $99 billion approved for FY2005 and $67 billion for FY2004.
The supplemental proposal
Table 1. Summary of FY2006
for international matters covers a
range of activities that were
Supplemental Request
either not addressed in the
($s — billions)
regular FY2006 Foreign
Request* House
Senate
Operations and State Department
appropriation measures (Darfur
Military ops: Iraq,
p e a c e k e e p i n g , P a k i s t a n
Afghanistan, &
$65.92 $67.72
$67.67
Global War on
earthquake relief), where
Terror
circumstances have changed
since passage of the regular
State Dept. &
$4.23
$4.06
$4.45
spending measures (Iran
Foreign Aid
democracy promotion and
Intelligence and
$0.44
$0.38
$0.39
various refugee and food crisis),
other war on terror
or have been largely funded
through supplementals rather
Hurricane relief
$19.76 $19.11
$28.81
than incorporated into the “base”
and reconstruction
of annual, on-going diplomatic
and aid operations (Iraq
Low Income Home

$0.75

Energy Assistance
reconstruction and U.S. embassy
needs in Iraq). The request of
Agriculture &


$3.96
$1.6 billion in stabilization
Drought Assistance
assistance for Iraq would be the
first sizable aid package for
Pandemic Influenza


$2.59
Baghdad since Congress
Port Security


$0.65
approved $18.45 billion in the
F Y 2 0 0 4 e m e r g e n c y
Border Security
$1.95 —
$1.90
supplemental measure. Further,
Veterans Medical


$0.43
the Administration seeks about
Services
$750 million for Iraq in its
regular FY2007 Foreign
Other


$0.03
Operations budget.
Defense Offset


($1.90)
The $19.8 billion for
TOTAL
$92.22 $91.95
$108.90
recovery and reconstruction in
the Gulf Coast region follows
Totals may not add because of rounding.
enactment last year of two
FY2005 supplementals of $10.5
* Request includes Administration revisions of
billion (P.L. 109-61) and $51.8
April 25 and May 18, 2006.
billion (P.L. 109-62) for
hurricane relief.2
2 Additional resources for hurricane victims have been made available through the
Department of Homeland Security Disaster Relief Fund and through assumed tax savings
(continued...)

CRS-4
The President has requested that the entire amount of both supplementals be
considered “emergency” appropriations, a designation that would exempt the funds
from any limitations contained in the FY2006 Budget Resolution. Nevertheless, the
supplemental would add to the size of the U.S. budget deficit. The Administration
does not seek any offsets from other previously approved spending that could have
the effect of reducing the supplemental’s impact on the deficit. Some Members
argue that some or all of the supplemental appropriation should be offset. Especially
as the size of the Senate version of the emergency supplemental grew during
committee and floor consideration, calls for offsets or the removal of spending for
matters other than the Iraq war or hurricane relief intensified. Some Senate-passed
amendments include corresponding offsets for new spending items — such as the
amendment by Senator Gregg to add funds for border security, with an equivalent
reduction in Defense Department appropriations. But many do not. As noted
elsewhere, despite not proposing any offsets to the original $92.2 billion request,
President Bush has said on several occasions that he would veto the legislation if the
final version exceeds his proposal, although he would allow increases for pandemic
influenza preparedness.
Summary of Congressional Action
As passed on March 17 (H.R. 4939; H.Rept. 109-388), the House provides
$91.95 billion in supplemental funds, $270 million less than the Administration’s
request. The legislation reduces the defense portion of supplemental by $137
million, cuts international programs by $166 million, and Gulf Coast hurricane relief
by $658 million. H.R. 4939 further makes available in FY2006 $750 million for
Low Income Home Energy Assistance that had previously been appropriated for
FY2007. This action, which was not requested by the Administration, raises the total
funding level of the bill. In addition to trimming the President’s proposal, the House-
passed measure includes a provision that would block the sale of operations at five
American port terminals to the UAE-based Dubai Ports World.
The Senate-passed version of H.R. 4939 increases the overall size of the
legislation to $108.9 billion, $16.8 billion over the request and $17 billion higher
than the House. The bill provides $67.7 billion for military operations in Iraq and
Afghanistan,3 and $4.45 billion for State Department and foreign assistance
2 (...continued)
for people affected by the disaster. See below for further discussion of complete hurricane
recovery measures and funding.
3 The actual figure for Defense costs in Iraq and Afghanistan is something less than the
$67.7 billion figure. During floor debate, the Senate passed an amendment by Senator
Gregg providing $1.9 billion for border security operations, offset by a 2.775% unspecified
cut in defense monies for both the Iraq war and Hurricane Katrina. Because the Defense
Department would have discretion to distribute the cut, it is not possible to say what the total
for war costs in the Senate bill would be. If the entire reduction was applied to war
expenditures, the Senate total could be as low as $65.8 billion, or as high as $67.6 billion
if the reduction was taken exclusively from DOD hurricane damage funds. The total for war
(continued...)

CRS-5
programs, roughly at the levels requested. The legislation further provides $28.8
billion for hurricane related expenses, about $9 billion more than proposed. The
Senate also includes several provisions unrelated to either military operations,
international affairs, or hurricane reconstruction, including $2.3 billion for pandemic
influenza preparedness, nearly $4 billion for agriculture disaster and economic
assistance, $650 million for port security, and $1.9 billion for enhanced security at
American borders that is offset with cuts for defense spending in the bill.
President Bush is threatening to veto the legislation because of the added
spending, although the White House says it supports the pandemic influenza
appropriation, and would accept a bill that does not exceed about $94.5 billion.
During floor consideration, the Senate acted on several amendments that proposed
to reduce various items in the bill, but in most cases the amendments were defeated,
tabled, or withdrawn. For example, Senator Coburn submitted an amendment cutting
19 separate programs proposed by the Senate Appropriations Committee totaling
over $2 billion. In individual votes, the Senate approved one element of the Coburn
amendment — cutting $15 million for the National Marine Fisheries Service to
implement seafood promotion strategies — but tabled an item that would have
deleted $700 million to relocate a CSX freight rail line further inland from the Gulf
Coast and defeated a proposal to delete Section 2303 that would broaden the Navy’s
liability for higher shipbuilding costs associated with business disruption. Senator
Coburn withdrew that remaining 16 divisions of his amendment.
The Senate further rejected an amendment by Senator McCain reducing
agriculture assistance by $74.5 million. The Senate also tabled an amendment by
Senator Thomas that would have replaced the committee text of the bill with the
President’s request, plus funding for pandemic influenza preparedness and border
security (with offsets), thereby reducing the bill’s total cost to $94.5 billion, and an
amendment by Senator Ensign that would have required the bill to be recommitted
to the Appropriations Committee with instructions to report back legislation not
exceeding $94.5 billion.
Other amendments passed by the Senate are set out below in tables and
discussed in detail.
Defense Issues
Senate Action. During floor debate, the Senate passed the Gregg amendment
(S.Amdt. 4939) which provides $1.9 billion for border security operations,
construction and procurement offset by a 2.775% unspecified cut in defense monies
for both the Iraq war and Hurricane Katrina. Because the Defense Department would
have discretion to distribute the cut, it is not possible to say what the total for war
costs in the Senate bill would be. If the entire reduction was applied to war
expenditures, the Senate total could be as low as $65.8 billion, or as high as $67.7
billion if the reduction was taken exclusively from DOD hurricane damage funds.
The total for war costs could also fall somewhere in between this high and low range.
3 (...continued)
costs could also fall somewhere in between this high and low range.

CRS-6
The Senate appropriators also cut $207 million from the $67.9 billion request
for war funds compared to a House cut of $137 million. Except for the Gregg
amendment, the Senate bill, like the House, largely redistributes funds with increases
being mainly offset by cuts.
In addition to the Gregg amendment reduction, significant war-cost-related floor
amendments considered in the Senate included:
! an amendment by Senator Byrd (S.Amdt. 3079), adopted 94 to 0,
that as in previous supplementals, states a sense of the Senate that,
after FY2007, the Administration should submit requests for funds
for ongoing military operations in Iraq and Afghanistan in the
regular budget covering the entire fiscal year and including detailed
justification;
! an amendment by Senator Biden adopted by voice vote (S.Amdt.
3717 as modified by S.Amdt. 3855) that prohibits the use of any
funds in the bill to establish permanent military bases in Iraq or
exercise U.S. control over Iraq’s oil infrastructure or resources; a
House amendment by Congresswoman Lee prohibits the use of
funds to negotiate a basing agreement with the government of Iraq
(see below).
Table 2. War-Related Defense Amendments: Senate Action
Sponsor
Purpose/Congressional Record Page Reference
Vote
Gregg
Adds $1.9 billion for operating, procurement, and
Agreed
construction expenses for border security offset by a $1.9
59-39
billion cut to DOD’s monies for war and Gulf hurricane
expenses (pp. S3532-S3542).
Coburn
Delete Section 2303 broadening Navy’s liability for higher
Rejected
shipbuilding costs associated with business disruption (pp.
48-51
S3864-S3869).
Biden
Prohibits use of funds to establish permanent military
Agreed
bases in Iraq or U.S. control of Iraqi oil or oil
voice vote
infrastructure (pp. S3937, S3942-S3943, S3948-S3949).
Byrd
Sense of the Senate that Administration should submit cost
Agreed
of military operations for Iraq and Afghanistan in the
94-0
regular budget after FY2007.
Chambliss-
Requires comprehensive DOD report on mortuary
Agreed
Isakson
procedures.
voice vote
Warner
Provides authority to heads of any federal agency to
Agreed
provide benefits equivalent to those of the Foreign Service
voice vote
to civilian personnel detailed to Iraq or Afghanistan.
Durbin and
Provides that federal employees activated to serve in the
Agreed
others
military would receive pay equal to their civil service pay.
voice vote
Salazar
Adds requirement to cover training to reporting
Agreed
requirement on Improvised Explosive devices.
voice vote

CRS-7
The Senate bill also differs from the House bill because it:
! reduces the $5.9 billion request to train, equip, and provide
infrastructure to Afghan and Iraqi security forces to $5.6 billion —
a more modest cut than the $4.8 billion House level — but adds a
proviso that no funds can be spent on infrastructure until “after the
formation of the unified Iraqi government;”4
! establishes a new $1.958 billion transfer fund, the “Joint Improvised
Explosive Device Defeat Fund,” that centralizes funds that are in
three separate accounts in the request, with Congress to receive a
spending plan within 90 days of enactment;
! adds procurement funds to keep the Abrams tank modification line
and the C-17 cargo aircraft lines open, accelerate V-22 production,
and buy more Predator UAVs that would be largely offset by cuts to
other programs;
! adds military personnel funds for recruiting and retention incentives
and for higher death benefits for service members who died between
May 12 and August 1, 2005 who are made eligible in the bill; and
! cuts $200 million from military construction projects in Afghanistan
and Iraq, calling for projects to be limited to those that “immediately
support operations,” and reducing funding for projects that could
signal a permanent U.S. presence in Iraq.
The Senate Committee also cited considerable concern about DOD’s
procurement requests because of the lack of standard budget information on
requirements and schedules. Like the House, the Senate Committee reduced DOD’s
requested transfer limit from $4 billion to $2 billion. Otherwise, the Senate
Committee basically approved the request.
House Action. The House-passed supplemental reduces the Department of
Defense’s $67.9 billion request for war costs by $137 million overall but redistributes
the funding among the various titles. The major changes made by the House are to:
! reduce the $5.9 billion request to train, equip and provide
infrastructure for Afghan and Iraqi security forces by cutting $1
billion intended for infrastructure for police forces, citing inadequate
justification;
! increase funds for procurement to $17.7 billion by adding $1.3
billion more primarily for upgraded tanks and HMMWVs;
! cut $600 million from Operation and Maintenance (O&M) funds,
providing $32.1 billion, close to the request;
4 S.Rept. 109-230, p. 22.

CRS-8
! increase military personnel funding by $340 million to $9.9 billion,
largely to restore a cut to DOD’s regular FY2006 funding; and
! cut military construction by $162 million, reducing the total to $323
million by rejecting various projects.
With the exception of these changes, the House measure largely approves the
Department’s request. The House Appropriations Committee, however, placed a
hold on spending for $990 million for military infrastructure for Afghan and Iraq
security forces until DOD submits a detailed project level plan. The committee cut
by half DOD’s requested ceiling on transfer authority to $2 billion and rejected the
request to allow transfers to or from military construction accounts. Citing
dissatisfaction with information provided by DOD, the House panel also required
several additional reports. The committee further set a $3.571 billion floor on
funding in the bill for National Guard and Reserve programs to prosecute the global
war on terror (GWOT).
During floor debate, the House considered several amendments affecting
defense issues but none changed the $67.7 billion for the Department of Defense
approved by the House Appropriations Committee. The House:
! agreed to an amendment by Representative Barbara Lee that would
prohibit the United States from using funds in the act to enter into a
basing agreement with the government of Iraq. Members focused
on differences among statements by various Administration
spokesmen about whether the United States would have permanent
bases in Iraq.5 Although the United States does not currently have
any basing agreements with Iraq, the Defense Department has
invested about $746 million in military construction funding in Iraq,
another $126 million in neighboring countries supporting the Iraq
mission, and another $322 million in bases supporting both Iraq and
Afghanistan.6 The House approved $225 million, cutting the DOD’s
request by $123 million (see below). If the House level is approved,
DOD would have invested about $1.1 billion in bases in or in
support of the Iraq mission (not including bases supporting both Iraq
and Afghanistan). Secretary Rumsfeld recently testified that some
“30 U.S. military bases have been returned to Iraqi control or closed
altogether.”7
! agreed to an amendment by Representative Millender-McDonald to
redirect Defense Health funding to training in orthotics and
prosthetics.
5 Congressional Record, March 16, 2006, p. H1107ff.
6 CRS calculations based on appropriations reports and other sources.
7 Secretary Rumsfeld testifying before the Senate Armed Services Committee, Hearing on
Defense Authorization
, February 7, 2006, transcript.

CRS-9
! rejected (193 to 225) an amendment by Representative Waxman to
prohibit the Army from spending any funds in the act with any
contractor where the Defense Contract Audit Agency had judged to
be unreasonable more than $100 million of contract costs.
Supporters argued that new contracts should not be signed with
contractors where auditors found unreasonable costs while others
raised concerns about whether not renewing current contracts could
disrupt the military’s logistical support.8
! sustained a point of order against an amendment by Representative
Kaptur that would set up a Truman type commission that would
investigate government contracts for military operations and
reconstruction in Iraq and Afghanistan and relief and reconstruction
contracts for Hurricane Katrina.9
Table 3. War-Related Defense Amendments: House Action
Sponsor
Purpose/Congressional Record Page Reference
Vote
Lee
Prohibits using funds in act to enter into a basing rights
Agreed,
agreement with Iraq government (pp. H1101-H1104).
voice vote
Millender-
Redirects funding for Defense Health by $20 million to
Agreed,
McDonald
increase training for prosthetics and orthotics in U.S.
voice vote
schools (p. H1013).
Kaptur
Sets up a “Truman”-type House Commission to investigate
Point of
government contracts for military operations and
order
reconstruction in Iraq and Afghanistan and Hurricane
sustained
Katrina relief and reconstruction (pp. H1098-H1099).
Waxman
Prohibits spending Army funds with any contractor if the
Rejected
Defense Contract Audit Agency has found that more than
193-225
$100 million of costs are unreasonable (pp. H1101-H1104,
and H1110-H1111).
International Issues
House Action. In total, the House-passed measure cuts the international
portion of the supplemental to $4.1 billion, $66 million less than requested. In most
cases where reductions were made, the House Appropriations Committee stated its
view that the emergency nature of the requests were not fully justified and that the
Committee will address the issues again when it considers the regular FY2007
8 See Congressional Record, p. H1101-H1104.
9 See Congressional Record, p. H1098.

CRS-10
appropriation proposal. Major items and changes to the Administration requests
include:
! reductions in USAID security and operation costs in Iraq,
Afghanistan, and Sudan;
! cuts in security for Provisional Reconstruction Teams in Iraq, but
full funding for other State Department operational costs in Iraq and
Afghanistan;
! near-full funding for Iraq stabilization assistance, with the
redirection of $26.3 million from some prison and judge security
funds to counter-narcotics programs in Colombia;
! Substantial cuts in Afghan reconstruction and debt relief proposals;
! a reduction from $75 million to $56 million for democracy and
related programs in Iran;
! full funding for southern Sudan and Darfur, plus an additional $110
million for peacekeeping operations in Darfur, for a total Sudan
package of $618 million;
! full funding for Pakistan earthquake relief and emergency food
refugee aid for Africa;
! an additional $50 million in economic aid for Liberia; and
! $26.3 million for the purchase of DC-3 aircraft for Colombian drug
interdiction efforts.
Table 4. International Amendments: House Action
Sponsor
Purpose/Congressional Record Page Reference
Vote
Shays
Directs that $20 million of economic aid funds for Iraq be
Agreed,
used for the Community Action Plan program (pp. H1016-
voice vote
H1017).
Burton
Redirects $26.3 million of Iraq funds for counter-narcotics
Agreed,
activities in Colombia (pp. H1067-H1068).
250-172
Capuano
Increases by $50 million funds for peacekeeping operations
Agreed,
in Darfur (p. H1068).
213-208
Garrett
Cuts $5 million for public diplomacy programs in Iran
Rejected,
(pp. H1069-H1070).
75-344
Garrett
Cuts $5 million for education and cultural exchanges for
Rejected,
Iranian students (p. H1070).
78-343
Foxx
Cuts $36.1 million for broadcasting into Iran (pp. H1070-
Rejected,
H1071).
88-333
Senate Action. As passed, the Senate version of H.R. 4939 largely funds the
Administration’s request for international programs, with some exceptions. The
Senate bill provides $4.45 billion for international affairs, an increase of $220 million
over the request. Concerning major items and changes to the request, the Senate
measure:

CRS-11
! cuts security funding for Provisional Reconstruction Teams in Iraq;
! further reduces State Department operational costs in Iraq by $60
million in order to add an additional $60 million for support of U.N.
peacekeeping in Darfur;
! fully funds Iraq stabilization assistance, with an earmark of $96
million for broad-based democracy programs;
! does not provide the House-passed counter-narcotics funding for
Colombia;
! includes $3.3 million for demobilization assistance in Colombia;
! fully funds southern Sudan and Darfur, with an additional $110
million in funding for peacekeeping in Darfur, the same as the
House;
! adds $50 million for economic aid for Liberia, the same as the
House;
! adds $42.5 million for various Migration and Refugee Assistance
programs in Somalia, the Horn of Africa, Democratic Republic of
Congo, North Caucasus, North Asia, and Burma;
! increases to $20 million Emergency Migration and Refugee
Assistance for the Horn of Africa;
! provides $35 million for drought relief in West Africa and the Horn
of Africa;
! adds $12 million for Hurricane Stan relief in Guatemala;
! rescinds $47 million in previously appropriated funds for economic
aid to Egypt in order to offset the increases for African drought and
Guatemala hurricane relief;
! adds $40 million in economic aid for Haiti;
! adds $100 million in Economic Support Funds for Jordan;
! adds $13.2 million in Democracy Funds and peacekeeping in the
Democratic Republic of Congo, with a rescission of the same
amount from the Export-Import Bank; and
! provides $5 million for election support in the Democratic Republic
of Congo.
Table 5. International Amendments: Senate Action
Sponsor
Purpose/Congressional Record Page Reference
Vote
Lugar
Waives annuity limitations on reemployed Foreign Service
Agreed,
#3597
and Civil Service annuitants in order to fill positions in
voice vote
Iraq and Afghanistan (pp. S3792-S3793).
Leahy
Requires notification to House and Senate Appropriations
Agreed,
#3661
Committees regarding the obligation of Democracy Fund
voice vote
money (p. S3793).
Leahy
Clarifies report language reducing the amount of
Agreed,
#3663
Democracy Fund appropriations for Iran by $5 million to
voice vote
$34.8 million, and specifying $5 million of Democracy
Fund appropriations for election support in the Democratic
Republic of Congo (p. S3793).

CRS-12
Sponsor
Purpose/Congressional Record Page Reference
Vote
Menendez
Increases by $60 million, to $129.8 million, funds for a
Agreed,
#3777
U.N. peacekeeping operation in Darfur; reduces by $60
voice vote
million funds for State Department mission operations in
Iraq (pp. S3939-S3940).
McConnell
Adds a Presidential national security waiver authority
Agreed,
#3612
regarding restrictions on U.S. aid to the Palestinian
voice vote
Authority (p. S3940).
Biden
Provides not less than $250,000 of Diplomatic and
Agreed,
#3719
Consular Programs of the State Department be used to
voice vote
create an office of a special envoy for Sudan (p. S3940).
Leahy
Provides that $3.3 million of funds appropriated under the
Agreed,
#3823
International Narcotics Control and Law Enforcement
voice vote
account be used to support the demobilization process in
Colombia; has the effect of reducing funds requested for
Iraq (pp. S3940-3941).
Kennedy
Provides that of ESF appropriations for Iraq, $104.5
Agreed,
#3686
million should be available for broad-based democracy
voice vote
assistance through NGOs in Iraq (pp. S3945-3948).
Leahy
Provides $12 million for Hurricane Stan relief in
Agreed,
#3657
Guatemala and $35 million for drought relief in West
voice vote
Africa and the Horn of Africa; rescinds $47 million in
previously appropriated cash transfer aid for Egypt (pp.
S3963-3964).
Santorum
Adds $25 million for Iran democracy programs (pp. S3937,
Ruled non-
#3640
3969).
germane
Hurricane Recovery Issues
The House-passed measure provides $19.1 billion for supplemental
appropriations for relief and recovery from the 2005 Gulf Coast hurricanes, a
reduction of $0.7 billion from what was requested by the President. The House bill
agrees with much of the supplemental request, but makes the following changes:
! does not fund the request of $202 million for Tenant-Based Rental
Assistance at the Department of Housing and Urban Development
(HUD);
! reduces the request for Procurement at DOD by $250 million —
$887 million is provided;
! reduces DOD Military Construction by $270 million — $135.5
million is provided;
! reduces the Department of Veterans Affairs (VA) funds for
rebuilding the VA medical center in New Orleans by $50 million —
$550 million is provided and the obligation is made contingent on
enactment by June 30, 2006, of authority for rebuilding the medical

CRS-13
center. In addition, the VA is allowed to transfer up to $275 million
of these funds for unforeseen medical needs related to the global war
on terror;
! expands the mechanism requested for the distribution of $4.2 billion
for the Community Development Block Grant (CDBG) so that it
would not be limited to Louisiana projects; and
! adds a provision to make available in FY2006 $750 million for the
Low-Income Home Energy Assistance Program (LIHEAP) that were
appropriated for FY2007 in the Deficit Reduction Act of 2005 (P.L.
109-171); these are contingency funds (allotted to one or more
states, at the Administration’s discretion, and based on emergency
need), and would remain available until the end of FY2007.
Table 6. Hurricane Recovery Amendments: House Action
Sponsor
Purpose/Congressional Record Page Reference
Vote
Millender-
Provides $20 million for Defense Health Programs to expand
Agreed,
McDonald
training capacity for prosthetics and orthotics (pp. H1013-
voice vote
H1014).
Jindal
Decreases funding for FEMA disaster relief by $2 million and
Agreed,
increases funding for Defense-wide procurement by the same
voice vote
amount (p. H1084).
Melancon
Increases funding for Flood Control and Coastal Emergencies by
Rejected,
$465 million (pp. H1033-H1034).
199-215
Jefferson
Increases Community Planning and Development by $2 billion
Rejected,
and decreases FEMA by the same amount (pp. H1034-H1035).
174-248
Sabo
Increases funding for the Customs and Border Protection (CBP),
Rejected,
the United States Coast Guard (USCG), FEMA administrative
208-210
and regional operations, and FEMA preparedness by $700
million, $125 million, $300 million, and $100 million,
respectively (pp. H1076-H1079, and H1094-H1095).
Neugebauer
Eliminates all funding in the bill for hurricane recovery
Rejected,
(pp. H1079-H1082, and H1095-H1096).
89-331
Millender-
Increases funding for election activities under FEMA by $20
Rejected,
McDonald
million (p. H1082-84, H1096).
194-227
Gingrey
Reduces funding for the National Historical Preservation Fund by
Rejected,
$3 million (p. H1086).
voice vote
On May 4, 2006, the Senate amended and approved its version of the FY2006
supplemental appropriations, H.R. 4939. As passed, the legislation provides a total
of $28.8 billion for hurricane recovery, $9.0 billion (45%) more than the President’s
request, and roughly 51% more than the House provided ($19.1 billion). In addition,
the bill provides $2.6 billion in funds for the prevention and preparedness for
pandemic influenza. The House did not fund these activities; the President requested
supplemental funds in November 2005. The Senate bill provides a supplemental

CRS-14
appropriation of $6.9 billion for other disaster assistance unrelated to hurricane
recovery or pandemic influenza; such assistance was not requested by the
Administration nor included in the House bill. The Senate bill differs from the bill
as passed by the House as follows. The Senate bill provides:
! $1.1 billion for mapping and debris removal to help Gulf Coast
fisheries affected by the hurricanes;
! $2.5 billion more for levee repairs and related (total of $4.0 billion)
for coastal and flood protection;
! $1.2 billion more for the Disaster Relief Fund and other a activities
administered by FEMA (total of $11.1 billion), with funds set aside
for the development of housing alternatives other than travel trailers;
! $881 million for education needs, including higher education loans
and grants;
! $1.5 billion for repairs to transportation infrastructure, public transit,
and grants for federal aid for highways;
! $1 billion more for CDBG (total of $5.2 billion) compared to both
the request and the House approved funding, with a set-aside for
low-income and assisted housing;
! $3.9 billion for emergency agricultural disaster assistance for crop
losses;
! $648 million for port security enhancement;
! $2.3 billion for pandemic influenza preparedness and response
activities;
! $1.9 billion for border security; and
! $430 million for veterans medical services.
Table 7. Hurricane Recovery and Other Domestic Amendments:
Senate Action on Selected Amendments
Sponsor
Purpose/Congressional Record page reference
Vote
Akaka
Provides an additional $430 million for Veterans Affairs
Agreed,
#3642, as
medical care (pp. S3560-S3564).
84-13
modified
by #3647
Gregg
Provides $1.9 billion for enhanced U.S. border security,
Agreed,
#3594
offset with a corresponding reduction in defense accounts
59-39
in titles I and II (p. S3532-S3543).
Reid
Provides $1.9 billion for enhanced U.S. border security,
Defeated,
#3604
without an offset (pp. S3532-S3544).
44-54
Ensign
Motion to recommit the bill with instructions that it be
Tabled,
reported back with a total net spending not exceeding
68-28
$94.5 billion (pp. S3562-S3563).
Coburn
Prohibits the availability of funds for the relocation of a
Tabled,
#3641,
CSX freight rail line further inland from the Gulf Coast
49-48
Division I
(pp. S3557-S3560; S3564-S3566).

CRS-15
Sponsor
Purpose/Congressional Record page reference
Vote
Coburn
Prohibits the availability of funds for seafood promotion
Agreed,
#3641,
strategies (pp. S3569-S3573).
voice vote
Division II
Allard
Provides $27.6 million to repair Capitol complex utility
Agreed,
#3701
tunnels (pp. S3683-S3684).
voice vote
Dodd
Provides $30 million for the Election Assistance
Agreed,
#3727
Commission for payments to states affected by 2005
voice vote
hurricanes (pp. S3870-S3872).
Domenici
Provides an additional $1.67 billion for levee rehabilitation
Agreed,
#3769
in New Orleans (p. S3859).
voice vote
Hutchison
Ensures that all localities incurring damage from Hurricane
Agreed,
#3789
Rita have the same cost-sharing requirements for federal
voice vote
aid (p. S3859).
Salazar
Provides an additional $30 million for National Forest
Agreed,
#3736
System projects (pp. S3878-S3879).
voice vote
Obama
Requires all contracts for hurricane relief exceeding
Agreed,
#3810
$500,000 be awarded using a competitive bidding process
98-0
(pp. S3879-S3880).
McCain
Strikes $6 million to sugarcane growers in Hawaii (pp.
Defeated,
#3617
S3858-S3863).
40-59
Cornyn
Establishes a floor to ensure that areas within States
Agreed,
#3699
adversely affected by 2005 hurricanes receive at least 3.5%
voice vote
of funds set aside for the Community Development Block
Grant program (pp. S3938-S3941).
Kennedy
Provides $289 million for compensation of individuals
Agreed,
#3688
harmed by pandemic influenza vaccine (pp. S3937, S3942-
53-46
43, S3948).
Inouye
Provides $1 million for assessing and monitoring waters in
Agreed,
#3601
Hawaii (pp. S3966-3968).
51-45
McCain
Strikes $74.5 million for agriculture assistance (pp. S3937,
Defeated,
#3616
S3953-3955, S3964).
37-61
Inouye
Adds $900,000 for assessments of reservoirs and dams in
Defeated,
#3673
Hawaii (pp. S3966-S3967).
43-53
Vitter
Provides an additional $200 million for flood prevention in
Agreed,
#3728
Louisiana, offset by a reduction in funds for FEMA (pp.
voice vote
S4007, S4011-S4013).
Thune
Provides $20 million for Veterans Affairs Medical
Defeated,
#3704
Facilities, with an offset (pp. S4007, S4013-4014, S4016).
39-59

CRS-16
Border Security: Administration and Senate
Proposals10
On May 18, the President amended his pending emergency supplemental request
by adding $1.948 billion11 for border security-related functions within the
Departments of Homeland Security (DHS) and Justice (DOJ). For the DHS, the
President’s request includes:
! $805 million for Customs and Border Protection (CBP), portions of
which will support deployment of 1,000 additional Border Patrol
agents and 256 miles of vehicle barriers;
! $327 million for Immigration and Customs Enforcement (ICE) for
4,000 additional detention beds in support of the Administration’s
goal to end catch and release along the southern border;
! $25 million for the Federal Law Enforcement Training Center
(FLETC); and
! $15 million for the DHS Preparedness Directorate for border
security-related grants.
The proposal further includes $756 million in DOD funding for deploying
rotations of up to 6,000 National Guard personnel along the southern border. Such
personnel would be mobilized under Title 32 authorities to operate surveillance
systems, build patrol roads, fences, and vehicle barriers, and train personnel, but
would not perform law enforcement functions. Although personnel would be under
the control of individual governors, the Defense Department would approve the use
and numbers of personnel. As proposed, these funds would be provided in the
operation and maintenance, defensewide account to be transferred to other accounts
at DOD’s discretion.12
According to Administration witnesses, these funds would provide up to 6,000
reserve personnel at any one time in the first year and 3,000 in the second year with
most of the personnel rotating in on two- to three-week assignments during their
10 This section was prepared by Jennifer Lake, Blas Nuñez-Neto, and Amy Belasco. For
a more detailed breakdown of the Homeland Security-related funding in the Supplemental
Appropriations Bills, please refer to CRS Report RL33428 Homeland Security Department:
FY2007 Appropriations
, Jennifer Lake and Blas Nuñez-Neto, Coordinators.
11 The actual request for DHS and DOJ was for $1.974 billion; however $16 million within
the CBP Construction account and $10 million within the U.S. Attorney’s office were not
border security related. This brings the border security related total request to $1.948
billion.
12 Office of Management and Budget, Estimate No. 6, FY2006 Emergency
Supplemental(Border Security: Departments of Defense, Homeland Security, and Justice)
,
May 18, 2006; [http://www. w h itehouse.gov/omb/budget/amendments/
supplemental_5_18_06.pdf].

CRS-17
annual training. Thus, up to 156,000 reservists could be mobilized for short periods
in the course of a year out of a 440,000 total in the Army National Guard. During a
recent hearing, a variety of concerns were raised — whether adequate personnel
would still be available for war and hurricane missions, the prerogatives of
governors, and the effectiveness of short-term mobilizations.13
While the Administration’s amended request is for a similar amount to that
included in Title VII of the Senate-passed version of H.R. 4939, it differs
substantially in its scope. The Senate Title VII generally focuses on capital
improvements within DHS, while the President’s request focuses on funding for
CBP, ICE, and National Guard personnel deployments, and for other resources on the
border. Title VII of the Senate-passed version of H.R. 4939 includes:
! $1.09 billion for CBP, portions of which will be used to replace air
assets and border patrol vehicles, to upgrade air operations facilities,
deploy sensor and surveillance technology, and for construction;
! $600 million for the Coast Guard aircraft and vessel acquisition,
construction, renovation and improvement;
! $80 million for ICE;
! $60 million to accelerate database integration and the conversion of
the United States Visitor & Immigrant Status Indicator Project (US-
VISIT) to a 10-print enrollment system;
! $50 million for the DHS Chief Information Officer to upgrade law
enforcement communications equipment;
! $18 million for the Federal Law Enforcement Training Center for
information technology improvements and a language training
center; and
! $2 million for the DHS Office of Policy to conduct a needs
assessment for comprehensive border security.
In order to offset the $1.948 billion cost of additional border security programs,
the Administration proposes reducing $1.948 billion in funding requested for
Operation Iraqi Freedom and Operation Enduring Freedom (Afghanistan and other
global war on terror operations). These funds would come primarily from
procurement. Although the Administration does not identify cuts specifically by
weapon systems, some of the cuts appear to come from those identified for reduction
by the House and Senate Appropriations Committees appropriators, while others
would reject Congressional adds-ons (see sections below and Appendix A for
details).
13 Senate Armed Services Committee, Transcript, Hearing on National guard Role in Border
Security
, May 17, 2006; available on Reuters.

CRS-18
American Port Security and the Dubai Ports World
Operational Control of Six U.S. Terminals14
The takeover of terminal operations at six major U.S. ports by Dubai Ports
World (DP World), based in the United Arab Emirates (UAE), has sparked intense
concerns among Members of Congress and the public, and has reignited the debate
over what role foreign acquisitions play in U.S. national security, and specifically
security of American ports. DP World purchased the terminals from P&O Ports, a
multinational terminal operating company based in the United Kingdom which leases
marine terminals around the world, including terminals at six U.S. ports — New
York, New Jersey, Philadelphia, Baltimore, Miami, and New Orleans.
These ports are owned by a port authority, which is a public or quasi-public
organization associated with the city, county, or state government. The port authority
is responsible for the overall administration of the property, terminals, and other
facilities on the port complex. Marine terminals within these ports are areas with
equipment for loading and unloading ships and space for staging cargo until it is
loaded on the ship or transferred to overland modes of transport. P&O Ports is also
involved in other cargo handling services at other East and Gulf Coast ports, and a
cruiseship terminal in New York. DP World acquired P&O’s terminal leases or
concessions at these ports, which account for a portion of the total cargo handling or
cruise ship activity that takes place at these ports. DP World currently operates 19
container terminals outside the United States and is involved in other cargo handling
services in 14 countries. DP World operates as a commercial entity but is owned by
the Government of Dubai in the UAE.
In addition to issues related to the review process for foreign investment in the
United States and U.S. foreign policy with regard to the UAE, a key issue for
Congress as it evaluates this transaction is what role marine terminal operators have
in the security of U.S. ports. While the federal government, namely the Coast Guard
and Customs and Border Protection (CBP), takes the lead in port security, security
responsibilities are also shared with the port authorities, local law enforcement,
vessel owners, terminal operators, and port workers. Coast Guard regulations and
CBP security programs require terminal operators to provide basic security
infrastructure and follow certain security practices when handling cargo.
While the United States actively promotes internationally the policy of relaxing
rules concerning foreign investment, including the national treatment of foreign
firms, some in Congress and others question some aspects of this policy as it relates
to allowing foreign competitors unlimited access to the Nation’s industrial base.
Much of this debate focuses on the activities of a relatively obscure committee, the
Committee on Foreign Investment in the United States (CFIUS) and the Exon-Florio
14 Prepared by John Frittelli, Analyst in Transportation, and James Jackson, Specialist in
International Trade and Finance.

CRS-19
provision (added to the Defense Production Act in 1988; P.L. 100-418), which gives
the President broad powers to block certain types of foreign investment.15
The proposed acquisition of port terminals operated by DP World has sparked
a firestorm of activity in the 2nd Session of the 109th Congress. H.J.Res. 79 and
S.J.Res. 32 express Congressional disapproval of the proposed acquisition and direct
CFIUS to conduct a full 45-day review of the transaction and to brief Members of
Congress on the results of the investigation. Numerous other bills related to the issue
have also been introduced. The matter was inserted into the FY2006 Supplemental
Appropriation during a House markup of the legislation on March 8.
In the face of mounting pressure from Capitol Hill and elsewhere, DP World
announced on March 9 that it would not manage the American ports itself, but
transfer operations to a U.S. “entity.” Subsequently, on March 15 DP World said it
would sell the U.S. port facility operations to an American buyer, a process that
might take four to six months. In the meantime, the UAE-based company said that
P&O Ports North America would be operated separately by a U.S. subsidiary.
Congressional Action
During the March 8 markup on the $92 billion emergency FY2006 emergency
supplemental, House Appropriations Committee Chairman Lewis submitted an
amendment aimed at blocking the acquisition by DP World of the six American port
terminals. The amendment, which passed 62-2, bars the use of any appropriated
funds to take action allowing the purchase by DP World, and further prohibits the
acquisition, notwithstanding any “prior action or decision or decision by or on behalf
of the President.” President Bush previously had said that he would veto any
legislation containing such text.
Following the March 9 announcement by DP World that it would turn over port
operations to an American entity, Chairman Lewis said in a press release issued on
March 10, that “reports that Dubai Ports World has agreed to sell its holdings of a
subsidiary involved in managing six American ports is encouraging news.”16
Nevertheless, the Lewis amendment remains in the House-passed version of H.R.
4939. The House defeated (38-377) an amendment offered by Representative
Gilchrest on March 15 that would have struck the text banning DP World purchase.
The Senate bill does not include language similar to the House regarding Dubai
Ports World. However, a Byrd amendment accepted by the Senate Appropriations
Committee adds $648 million for port security grants, radiation portal monitors, and
for activities of the Coast Guard, Customs and Border Protection Service.
15 For more information, see CRS Report RL33312, The Exon-Florio National Security Test
for Foreign Investment
, by James Jackson.
16 Chairman Lewis Makes a Statement on DP-World Development, March 10, 2006.
Available at House Appropriations Committee website: [http://appropriations.house.gov/
index.cfm?FuseAction=Home.Home]

CRS-20
Defense Supplemental17
To cover war costs, the FY2006 revised supplemental requests $65.9 billion for
the Department of Defense (DOD) war-related costs, an amount that is in addition
to the $50 billion that DOD already received in the FY2006 bridge fund included in
DOD’s FY2006 Appropriations Act (P.L.109-148).18 If enacted, this would bring
DOD’s total for Iraq (Operation Iraqi Freedom or OIF) and Afghanistan/other global
war on terrorism activities (Operation Enduring Freedom or OEF) to $115.8 billion
in FY2006.
If passed as revised, DOD’s funding in FY2006 would be $17 billion more than
the $99 billion received in FY2005 and $49 billion more than the $67 billion
received in FY2004 (Table 8).19 Based on this request, DOD’s war and occupation
costs would increase from $67 billion in FY2004 to $116 billion in FY2006 — an
increase of 72% in two years.
In FY2003, the year of the invasion of Iraq, the Defense Department’s war costs
totaled between $69 billion and $76.2 billion depending on whether $7.1 billion in
funds provided in DOD’s FY2003 regular appropriations are included.20
17 Prepared by Amy Belasco, Specialist in National Defense. Military construction section
prepared by Daniel Else, Specialist in National Defense.
18 In FY2005 and FY2006, Congress included “additional appropriations” for war costs in
Title IX of DOD’s regular appropriations act to ensure that DOD would have sufficient
funds to cover war costs until a supplemental was passed.
19 The $99 billion total for FY2005 includes $75.9 billion in the FY2005 Supplemental (P.L.
109-13) and $23.1 billion of the $25 billion appropriated to DOD in the FY2005 bridge
supplemental (Title IX, P.L. 108-287). Congress provided that the FY2005 bridge funds
were available upon enactment and DOD obligated $1.9 billion in FY2004, leaving $23.9
billion available for FY2005.
20 See CRS Report RL33110, The Cost of Iraq, Afghanistan and Enhanced Security Since
9/11
, by Amy Belasco.

CRS-21
Table 8. Defense Department War and Occupation
Appropriations, FY2004-FY2006
($s — billions)
FY2004
FY2005
FY2006 Bridge:
FY2006
FY2006
Department of P.L.108-106;
P.L.108-287;
P.L.108-148
Revised
Total with
Defense
P.L.108-287a
P.L.109-13b
Supp.
Supp.
Total
$66.8
$98.8
$50.0
$65.9
$115.8
Annual Change
NA
$32.0
NA
NA
$17.0
$ Change Since
NA
$32.0
NA
NA
$49.0
FY2004
% Change
NA
48%
NA
NA
73%
Since FY2004
Source: CRS calculations based on public laws.
a. Total for P.L. 108-106 excludes $3.5 billion rescission of FY2003 funds; includes $1.9 billion of
funds in the FY2004/FY2005 bridge fund that was obligated in FY2004 (Title IX, P.L. 108-
287).
b. Total for FY2005 includes funds available for FY2005 from the FY2004/FY2005 bridge fund and
funds appropriated in the FY2005 supplemental (P.L. 109-13) excluding funds for Tsunami
relief and the Office of the Director of National Intelligence.
According to DOD’s justification materials, the FY2006 supplemental request
assumes that monthly deployment levels will average about 138,000 troops in Iraq
and 18,000 troops in Afghanistan, with temporary fluctuations during troop rotations.
DOD does not provide a breakdown of how the revised $65.9 billion request would
be allocated between Iraq and Afghanistan. DOD’s justification materials state that
monthly military personnel and operation and maintenance costs — the expenditures
most closely tied to military operations — averaged $4.5 billion in Iraq and $0.8
billion in Afghanistan and other global war on terrorism activities, or a total of $5.3
billion monthly for both operations in FY2005.21
If one defines “military operations costs” as the cost of military personnel and
operation and maintenance and applies this approach to the enacted bridge fund and
DOD’s new supplemental FY2006 request, average military operations costs per
month would increase from $5.6 billion in FY2005 to $6.8 billion per month in
FY2006, a 21% increase (see Table 9). These average monthly costs include only
those costs that would be obligated in FY2006 but not all of DOD war and
occupation costs that are associated with operations. For example, this definition of
“military operations costs” does not include additional funds spent for national
intelligence (cost not tracked by DOD) or training of Afghan and Iraq security forces,
21 Department of Defense, FY 2006 Supplemental Request For Operation Iraqi Freedom
(OIF) and Operation Enduring Freedom (OEF)
, February 2006; [http://www.dod.mil/
comptroller/defbudget/fy2007/FY06_GWOT_Supplemental_Request_-_FINAL.pdf], p. 3
(hereinafter cited as DOD, FY2006 Supplemental Request - war).

CRS-22
now a substantial expense. Nor do military operations costs — as defined by DOD
— include DOD’s substantial investment costs for additional equipment for
deployed forces that DOD believes needs to be ordered in FY2006 to meet its
military needs.22
If all these costs are included, full monthly war and occupation costs would
average $8.2 billion in FY2005, and would increase to $9.7 billion in FY2006 if
DOD’s request is enacted. Table 9 shows the average monthly increases for each of
these categories, which range from decreases for military personnel and Afghan and
Iraq training funds to increases in O&M and investments.
Potential Issues in DOD’s FY2006 Supplemental Request
In its revised FY2006 supplemental request, the Department of Defense is
requesting $65.9 billion to provide special pays for military personnel, activate
reserves, support military operations, repair equipment, house and provide for troops,
buy additional military equipment, conduct research and development, construct
military facilities, train Afghan and Iraqi security forces, and reimburse coalition
allies, a reduction of $1.9 billion from the original request.23
Table 10 lists the
major elements of the new request by title, the amount in the FY2006 bridge fund
(Title IX, P.L.109-148) and the total for FY2006 as requested and approved to date.
For a breakdown by appropriation account, see table appended to this report.
22 DOD requests that its procurement funds be available for three years to take into account
the one to three years that it takes to contract, order, produce and receive military parts and
equipment.
23 See Office of Management and Budget (OMB), Estimate No. 6, May Office of
Management and Budget, Estimate No. 3, OMB, FY2006 Supplemental Request, Estimate
No. 3, FY2006 Emergency Appropriations (various agencies), Ongoing Military, Diplomatic
and Intelligence Operations in the Global War on Terror, Stabilization and
Counterinsurgency Activities in Iraq and Afghanistan, and Other Humanitarian Assistance
,
2 - 1 6 - 0 6 ; [ h t t p : / / w w w . w h i t e h o u s e . g o v / o m b / b u d g e t / a m e n d m e n t s /
supplemental2_2_16_06.pdf]; (Hereafter cited as OMB, FY2006 Supplemental War
Request
.) DOD, FY2006 Supplemental Request - war.

CRS-23
Table 9. Average Monthly DOD Budget Authority for War and
Occupation, FY2005 Enacted-Revised FY2006 Request
($s — billions)
FY2006:
Bridge
FY2006 +/- FY2005
FY2005:
&Revised
Title
Bridge & Suppa Supp Requestb
$s
%
Military Personnel
$18.4
$15.8
($2.6)
-14%
Operation & Maintenance(O&M)
$46.0
$61.3
$15.3
33%
Other supportc
$2.9
$4.2
$1.2
42%
Military Operations Total
$67.3
$81.3
$13.9
21%
Monthly Average: Military
$5.6
$6.8
$1.2
21%
Operations (BA)
Other Defense programsd
$3.9
$5.0
$1.0
26%
Afghan and Iraq Training Forces
$7.0
$5.9
($1.1)
-16%
Fund
Intelligencee
[5.1]e
[5.6]
[.5]e
[10%]e
Investment
$20.5
$23.8
$3.3
16%
Total Costs
$98.9
$115.8
$16.9
17%
Monthly Average,Total Budget
$8.2
$9.7
$1.5
18%
Authority
Sources: CRS calculations based on public laws, conference reports, DOD, FY2006 Supplemental
Justification Materials
, February 2006.
Note: Totals may not add because of rounding.
a. Includes remaining funds in FY2005 bridge (P.L. 108-287) and FY2005 Supplemental (P.L. 109-
13) excluding funds for Tsunami relief and office of the Director of National Intelligence.
b. Includes $50 billion in P.L. 109-148, FY2006 DOD Appropriations Act and $67.9 billion in
FY2006 supplemental request (OMB Estimate No. 6, May 16, 2006; and revised OMB Estimate
No. 3, original request.
c. “Other support” includes defense health and working capital funds.
d. “Other Defense programs” include Iraq Freedom Fund, the Office of Inspector General, and Drug
Interdiction and Counterdrug.
e. Funding of $1.8 billion for intelligence was included in the Iraq Freedom Fund in P.L.108-287, and
$3.3 billion in P.L. 109-13 for a total of $5.1 billion for FY2005. Funding of $3 billion was
included in the Iraq Freedom Fund in the FY2006 bridge (P.L. 109-148), and the FY2006
request includes an additional $2.6 billion for a total of $5.6 billion; see DOD, FY2006
Justification - War
, Feb. 2006, p. 1.
Several potential issues about the new FY2006 supplemental request may arise
in Congress, including whether DOD’s funding requests for training Afghan and Iraqi
security forces are necessary in light of the pace of implementation, how to make
transparent the DOD assumptions about military personnel levels for active-duty and
reserve forces that underlie the request, whether DOD could better contain increases
in operating costs, and whether DOD’s investment request finances peacetime as well
as wartime needs.

CRS-24
Table 10. Department of Defense FY2006 War-Related Bridge
Supplemental and FY2006 War-Related Supplemental Request
($s — billions)
FY2006
FY2006
Enacted
Supp.
FY2006
plus
Revised
House
Senate
Title
Enacted
Request
Request
Supp.
Supp.
Iraq Freedom Fundb
$4.66
$4.76
$0.10
$0.00
$0.03
Afghanistan Security Forces Fund
$0.00
$2.20
$2.20
$1.85
$1.91
Iraq Security Forces Fund
$0.00
$3.70
$3.70
$3.01
$3.70
Joint Improvised Explosive Defeatc
$0.00
$0.00
$0.00
$0.00
$1.95
Military Personnel
$6.21
$15.80
$9.59
$9.93
$10.20
Operation and Maintenance
$28.56
$61.29
$32.71
$32.11
$31.60
Procurement
$7.98
$24.38
$14.64
$17.68
$15.46
Research, Development, Test & Eval
$0.05
$0.83
$0.74
$1.00
$0.71
Military Construction
$0.00
$0.49
$0.34
$0.32
$0.28
Revolving & Management Funds
$2.52
$3.03
$0.52
$0.50
$0.52
Other Defense d
$0.03
$1.38
$1.35
$1.32
$1.31
Total
$50.00
$117.87
$65.91
$67.72
$67.67 d
General Provision reducing DOD
war & hurricane funds e

-.-
-.-
-.-
-.-
($1.90)d
a. Reflects $1.948 billion reduction proposed by the Administration on May 18, 2006 (OMB Estimate
No. 6).
b. Iraq Freedom Fund includes $3 billion for intelligence in the FY2006 bridge fund (Title IX,
P.L.109-148), and $100 million in the FY2006 request for two-year money for commanders’
“near-term urgent operational needs;” see OMB, Estimate No. 3, 2-16-06; also includes $100
million for the Coast Guard.
c. Request and House bill include $1.958 billion in three separate accounts.
d. “Other” includes Defense Health, Drug Interdiction and the Office of the Inspector General.
Department of Defense, FY 2006 Supplemental Request For Operation Iraqi Freedom (OIF)
and Operation Enduring Freedom (OEF)
, February 2006; [http://www.dod.mil/comptroller/
defbudget/fy2007/FY06_GWOT_Supplemental_Request_-_FINAL.pdf].
e. The Senate adopted an amendment providing $1.9 billion for border security, to be offset by an
unspecified cut of $1.9 billion in DOD funds for both war costs (title I) and hurricane
rehabilitation (title II). The Administration would determine the distribution of the cut among
programs in both titles. Consequently, the $67.67 billion Senate total for war costs could fall
somewhere in the range of $65.77 billion and $67.67 billion, depending on how the reductions
would be allocated.
Afghan and Iraq Security Forces Funds: Obligations Slower Than
Anticipated. In its FY2006 supplemental, DOD requests $2.2 billion for the
Afghan Security Forces Fund and $3.7 billion for the Iraq Security Forces Fund to
train and equip Afghan and Iraqi security forces. These funds are in addition to $500
million that DOD may use in the FY2006 bridge for either country.24 Altogether,
24 Section 9005, P.L. 109-148 sets a ceiling of $500 million from funds within Title IX.

CRS-25
DOD would have available $6.4 billion in FY2006 and FY2007 for training and
equipping in addition to funds already appropriated.25
For Iraqi security forces, the request includes:
! $787 million to equip Iraq’s brigades by purchasing aircraft, patrol
boats, equipment, and ammunition, $751 million for basing and
infrastructure;
! $712 million for police equipment, $696 million for basing, $250
million for training, $296 million to maintain buildings; and $65
million for other police needs; and
! $73 million to train and equip Iraqi security guards for detainee
operations or contract for those services.
For Afghan security forces, the request includes:
! $585 million for police training, $346 million for police
infrastructure, $235 million to maintain equipment and pay police
salaries and $195 million for equipment;
! $225 million to operate and support Afghan military forces, $221
million for military equipment, $138 million for training, and $240
million for military infrastructure; and
! $14 million for detainee operations.
Although training and equipping Afghan and Iraqi security forces is clearly a
high priority for the Administration, it appears that DOD is obligating these funds
more slowly than originally anticipated so that funding requested for FY2006 could
be greater than currently required. The $5.9 billion requested in the FY2006 bridge
supplemental would be in addition to the $7 billion — $1.3 billion for Afghanistan
and $5.7 billion for Iraqi security forces — already received by DOD in FY2005, and
the $6.9 billion previously provided in the FY2004 supplemental.
As of January 2006, about $235 million of the $5 billion provided for training
Iraqi forces in the FY2004 supplemental was unobligated or still available to be
spent;26 obligations data for Afghanistan are not available. Of the $5.7 billion
appropriated for Iraq in FY2005, about $2.1 billion or about 37% is obligated as of
January 1, 2006. In its plan for FY2005, DOD had projected obligations of $4.3
billion or about 75% at that point. In the case of Afghanistan, DOD has obligated
about $733 million or 33% of the $1.3 billion appropriated as of January 1, 2006.
This is also below the $825 million or 64% anticipated by DOD last year.27
25 As in previous proposals, the monies are requested to be available for two years or until
September 30, 2007.
26 State Department, Section 2207 Reports, Iraq Relief and Reconstruction Funds (IRRF) -
Status of Funds, obligations as of December 28, 2005.
27 See entries for these accounts in Standard Form (SF)133, Report on Budget Execution and
Budgetary Resources
, October 2005 and FY2006, 1/30/06 for 1st quarter FY2006.
[http://www.whitehouse.gov/omb/reports/sf133/FY_2005_SF_133s_w_Revis.pdf]. For
(continued...)

CRS-26
Potential Training Funding Issues. With the current rate of spending,
some observers could question whether the full $5.9 billion requested to train and
equip Afghan and Iraqi forces is needed at this time. Last year, DOD anticipated that
training funds appropriated in FY2004 would run out in June 2005 for Iraq and in
October 2005; some $235 million remains available. Obligations of FY2005
appropriations are also below those anticipated for FY2005 monies, particularly for
Iraq. On the other hand, the FY2006 supplemental requests funds that would be
available for two years and so could also be used in both FY2006 and FY2007.
Another potential issue is whether Congress might want advance notification
of DOD’s overall plans for the types of equipment to be provided to Afghan and Iraqi
security forces. While the current and proposed statutory language requires DOD to
provide five-day advance notification of individual transfers from the account, this
does not give Congress an overall sense of DOD plans for the amounts and types of
equipment to be provided. Nor is it clear whether DOD plans to transfer or leave
behind any U.S. equipment and how that would factor into such plans.
Congressional Action. The House measure provides $1.9 billion to Afghan
security forces and $3 billion for Iraqi Security forces in specially segregated funds
to cover the cost to train, equip, and build facilities for military and police forces.
Pending submission of complete justification materials, the House Appropriations
Committee cut funds intended to build facilities for Afghan ($396 million) and Iraqi
police forces ($696 million). The Committee also put a hold on another $991 million
slated for military infrastructure until DOD submits a detailed, project-by-project
financial plan.
The Senate-passed measure provides $1.91 billion to train Afghan security
forces — close to the House level and $3.7 billion for Iraq security training — $700
million more than the House and the same as the request. During Committee
markup, the Senate panel added language that places a hold on funds to repair and
construct Iraqi security infrastructure until formation of a unified government.28 In
its April 25, 2006 statement of administration policy, the Administration specifically
objected to the reduction in funds for Afghan security forces as reported by the
Senate Committee on Appropriations.
Coalition Support. As in previous years, DOD is requesting funds to make
payments to “key cooperating nations” that provide logistical and military support for
operations in Iraq and Afghanistan. In the FY2006 supplemental, DOD requests $1.5
billion for coalition support and $550 million for “lift and sustain funds” — to assist
Iraq and Afghanistan and other nearby friendly nations in their efforts to combat
terrorism — in addition to the $195 million in coalition support bridge funds. This
would bring the total to $2.2 billion for support of coalition partners.
27 (...continued)
DOD plan, see DOD, “Iraq/Afghanistan Security Forces: DOD’s FY05 Supplemental
Request,” March 2005.
28 S.Rept. 109-230, p. 21-22.

CRS-27
In FY2005, DOD received $1.2 billion for coalition support. DOD does not
provide a rationale for the increased funding for coalition support requested. If
history is a guide, much of the funds will go to Pakistan, with the remainder to
Jordan, Afghanistan, Ukraine, Poland, and other coalition allies.29
Congressional Action. The House bill reduces the DOD request for
coalition support by $300 million, approving $1.2 billion, the same level as last year.
The House bill also reduces the $550 million for “lift and sustain” by $104 million,
saying that those funds should come out of the Iraq Security Forces Fund.30 The
Senate bill halves DOD’s $1.5 billion request for coalition support to $760 million
compared to the $300 million cut in the House. The Senate measure also cuts “lift
and sustain” funds by $104 million, as does the House. In its April 25, 2006,
statement of administration policy, the Administration specifically objected to the
Senate-proposed cuts for coalition support.
Commander’s Emergency Response Program (CERP). DOD is also
requesting $423 million for the Commander’s Emergency Response Program
(CERP), a program where military commanders can fund local projects for
humanitarian relief and reconstruction. The FY2005 Supplemental set an upward
limit of $854 million in FY2005, $500 million above DOD’s request.31 Congress
may again want to raise the DOD request based on its assessment of the program’s
effectiveness.
Congressional Action. The House measure approves the DOD request that
set a $423 million ceiling on CERP programs, but the Appropriations Committee
cited concerns about a change in the program’s focus. The Senate bill also approves
the requests for CERP.
Iraq Freedom Fund. The House rejected DOD’s request for $100 million in
the Iraq Freedom Fund transfer account. The Senate provided $25 million.
New Joint Improvised Explosive Device Defeat Fund. The Senate bill
sets up a new transfer account that would allow the Director of the Joint Improvised
Explosive Device Defeat Organization to “investigate, develop and provide
equipment, supplies, services, training, facilities, personnel and funds to assist U.S.
forces in the defeat of improvised explosive devices,” (IEDs) with a report to the
congressional defense committees required within 90 days of enactment on DOD’s
plans.32 The $1.958 billion allocated to this new account is drawn from $490 million
in O&M, Army, $1.1billion in Other Procurement, Army and $357 million in
RDT&E Army included in DOD’s request. The House approved the monies in
DOD’s request for countering IEDs but left the funds in the three separate accounts.
29 Office of the Secretary of Defense, Coalition Support Fund Tracker, FY2002-FY2005,
February 2006.
30 H.Rept. 109-388, p. 14.
31 See Section 1006, P.L. 109-13, which raised the limit set in the FY2005 National Defense
Authorization Act (P.L. 108-375).
32 See H.R. 4939 as marked up by the Senate, p. 101-102.

CRS-28
Military Personnel Request and Visibility of Personnel Plans. The
Defense Department is requesting $9.6 billion for military personnel in the FY2006
supplemental, which would bring total funding for the year — including the bridge
supplemental — to $15.8 billion. This is $2.9 billion less than received by DOD for
FY2005.33 It is not clear why the level is almost $3 billion lower this year.
Additional War-related Military Personnel Benefits. In the FY2006
supplemental request, $3.2 billion is slated to pay for additional war-related military
personnel benefits including:
! $1.4 billion for special pays for active-duty forces including hostile
fire pay, family separation allowances, hardship duty;34
! $341 million for additional recruiting and retention bonuses to
sustain wartime forces levels;
! $59 million for higher foreign language proficiency pay;
! $544 million for death gratuities;
! $400 million for additional life insurance claims above peacetime
levels;35
! $474 million for catch-up benefits for service members who suffered
traumatic injuries who would qualify under the new benefit enacted
in the FY2006 National Defense Authorization Act;36 and
! $22 million for insurance premiums for OIF/OEF personnel.
With the $800 million already received in the FY2006 bridge fund, the total for war-
related special pay and benefits in FY2006 would be about $4 billion.37 Since the
launch of military operations in Iraq, Congress has raised and added war-related
personnel benefits and may again consider whether these benefits are sufficient.
Sustaining Force Levels. The FY2006 supplemental request includes $6.2
billion to sustain current force levels, including $653 million to support active-duty
force levels above normal peacetime levels, known as “overstrength,” and about $5.5
billion to pay activated reservists.38 In DOD’s plan, Army troop levels will be 16,300
above and Marine Corps levels will be 6,000 above peacetime strength levels in
33 DOD’s reported war-related obligations for military personnel are $15.9 billion according
to the September 30, 2005 report of the Defense Finance Accounting Service (DFAS),
Supplemental & Cost of War Execution Report. These reports, however, appear not to
capture about $2.95 billion in military personnel obligations as recorded by the SF-133, the
government’s standard financial reporting system.
34 Congress has authorized monthly levels of $225 for imminent danger pay, $250 for family
separation allowance and $100 for hardship duty location pay for those deployed less than
12 months and $300 for those deployed more than 12 months.
35 Payments go to the Department of Veterans Affairs to pay claims.
36 Payments go to the Department of Veterans Affairs to pay claims.
37 CRS calculations based on H.Rept. 109-359, p. 471.
38 This includes some $933 million for basic allowance for housing for dependents of
activated reservists.

CRS-29
FY2006. DOD has already received $420 million to cover overstrength costs, which
would bring the total base for the Army and 175,000 for the Marine Corps.
DOD’s FY2006 request also includes $5.5 billion to pay activated national
guard and reserve forces, in addition to $4.6 billion included in the FY2006 bridge
fund for “incremental” war costs for military personnel. That would bring the total
to about $10.1 billion, or about $1.5 billion less than requested in FY2006.39 DOD’s
wartime financial reporting system reports $8.4 billion to activate reserve forces in
FY2005 but this figure appears to be understated.40
DOD’s FY2006 supplemental justification does not include any information
about the mix of active-duty and reserve forces anticipated in FY2006 that would be
funded with these monies. And because of the discrepancies in the figures, it is
impossible to say whether DOD’s estimated funding in FY2006 is similar to or
different from last year. In general, the more that DOD relies on reservists, the
higher are war-related military personnel costs. That is because DOD’s incremental
war costs for active-duty forces include only special pays because their regular pay
is included in DOD’s regular appropriations whereas the additional full-time pay for
activated reservists is a wartime expense.
According to a DOD data base, about 36% of the 270,00 forces deployed in
support of the global war on terror were activated reservists and about 64% were
active-duty in FY2005, figures similar to those cited by DOD spokesperson.41
According to DOD, the FY2006 funding request supports overall force levels in
FY2006 that are similar to those in FY2005 — about 138,000 in Iraq and 18,000 in
Afghanistan. These figures do not appear to include other forces in the region or
elsewhere supporting the global war on terrorism.
In light of concerns about stress and sustaining both active-duty and reserve
forces, Congress may want to know the DOD planning assumptions that underlie its
FY2006 supplemental request for military personnel, including not only personnel
in-country but all those paid for by bridge and supplemental funds. That information
is not provided in DOD’s justification material.
Congressional Action. The House bill adds $300 million to Navy Military
personnel in order to restore monies cut from the regular budget in a government-
wide 1% across-the-board cut levied to offset additional Gulf Hurricane monies.42
39 See H.Rept. 109-359, p. 471.
40 DFAS, Supplemental & Cost of War Execution Report, September 2005; the FY2007
budget shows almost all military personnel funds as obligated; see OMB, FY2007 Budget
Appendix at [http://www.whitehouse.gov/omb/budget/fy2007/pdf/appendix/mil.pdf]. CRS
compared appropriated levels to those reported in DFAS reports and those reported in the
FY2007 budget to identify a discrepancy of about $3 billion.
41 CRS calculations based on Defense Manpower Data Center, Contingency Tracking
System, Deployed Military Personel by Country and Component
, November 2005 run.
42 Sec. 3801, Title, III, Chapter 8, P.L.109-148 requires a 1% across-the-board cut
(continued...)

CRS-30
The House also adds $40 million for Army Reserve personnel for recruiting and
retention programs.
The Senate bill also includes $300 million to restore funds cut for regular
expenses of Military Personnel, Navy by the 1% cut. In addition, the Senate adds
$195 million to the $305 million request for recruiting and retention incentives that
is included in the services’ military personnel accounts. Most of the funds go to the
Army. (An additional $85 million for recruiting and retention is in the O&M
accounts.) The Senate further adds $49 million for higher death benefits, which the
bill makes available to service members who died between May 12, 2005, and
August 1, 2005.43
Operation and Maintenance Funding Rises Substantially in FY2006.
The Defense Department is requesting $32.7 billion in Operation and Maintenance
(O&M) funds in the FY2006 supplemental. These funds would be in addition to the
$28.6 billion received in the FY2006 bridge fund, and would bring total funding in
FY2006 to $61.3 billion. That amount is $15.5 billion or about one-third higher than
the $45.8 billion appropriated in FY2005.
O&M funding pays for activities and services ranging from personnel support
for troops (e.g., subsistence, body armor, morale, welfare and recreation activities)
to the cost of operating forces and billeting troops. Major elements in the $32.7
billion in the FY2006 supplemental — all in addition to FY2006 Title IX bridge
funds — include
! $12 billion for operating support (fuel, spare parts, and related
expenses);
! $1.9 billion in personnel support (e.g., subsistence, body armor and
other protective gear);
! $2.4 billion for billeting of soldiers, base camp facilities, staging
areas, airfields;
! $500 million for command, control, communications and tactical
intelligence;
! $9.5 billion for transportation personnel and equipment both to and
within the theater;
! $3.2 billion for equipment maintenance in-theater and depot
maintenance at home; and
! $2.8 billion in other unspecified support costs.
It is difficult to explain the increases in FY2006 because DOD did not show the
funding already received in the bridge supplemental in its justification materials.
Since DOD did not request the bridge funds — though it did not oppose them —
there was no formal request or justification material. It appears that about half of the
$15.3 billion increase in FY2006 for O&M can be explained by higher transportation,
maintenance, and fuel costs.
42 (...continued)
government-wide except for the VA and emergency appropriations.
43 Sec. 1310, H.R. 4939 as marked up by the SAC, and S.Rept. 109-230, p. 39.

CRS-31
Depot Maintenance and Transportation Slated for Large Increases.
If the FY2006 request is approved, DOD’s total depot maintenance bill for FY2006
would be $7.3 billion — about $2.1 billion, or almost 40% higher than the FY2005
level.44 According to DOD’s justification material, the additional depot maintenance
requirements reflect the harsh desert environment and wartime conditions, which
have increased the wear and tear on equipment.
Another area programmed for large increases is transportation of personnel and
equipment to and within theater for which DOD is requesting $9.5 billion. Including
FY2006 bridge funds brings the FY2006 total to $10.8 billion, or about $4 billion,
or almost 60% higher than the $6.8 billion in FY2005. DOD attributes about $1.8
billion of the increase to higher fuel costs in FY2006. Excluding those costs, the
total would still be almost one-third higher than the previous year.
DOD does not provide a breakdown between its use of more expensive airlift
vs. sealift to transport goods but notes that the “Department is working to reduce the
proportion of air transport used and to lower the costs ... but ... will continue to need
air transport for the most critical items and shipment,” a commitment also included
in DOD’s justification material for FY2005.45 It is not clear why in the fourth year
of operations, DOD is still heavily relying on air transport of supplies.
Higher fuel prices may also account for increases in operating tempo costs that
include fuel, spare parts, and other costs of deployed units. DOD’s request is
predicated on the assumption that the average price of fuel — with service charges
— rises from $62 to $84 per barrel.46 DOD estimates that higher fuel costs in
FY2006 account for $2.6 billion in higher costs, including $2.2 billion financed in
the bridge fund and $423 million in the new supplemental.47
The FY2006 O&M supplemental also includes $539 million for body armor
plus an additional $140 million in the bridge supplemental for a total of $680 million.
This appears to be comparable to the $650 million appropriated for body armor in
FY2005.48
These three areas — equipment maintenance, transportation, and higher fuel
costs would account for about $8.7 billion, or roughly half of the $15 billion increase
in O&M in FY2006. From DOD’s justification material, the source or rationale for
other funding increases or for continuation of FY2005 levels for other areas is not
apparent.
Congressional Action. The House-passed measure cuts a total of $630
million from DOD’s $32.7 billion O & M request, decreasing funds for higher fuel
44 DOD obligated $5.2 billion for depot costs in FY2005; see DFAS, Supplemental & Cost
of War Execution Report
, September 2005.
45 DOD, FY2006 Supplemental Request — war, p. 10.
46 Ibid., p. 12
47 Ibid., pp. 10, 12.
48 CRS calculations based on H.Rept. 108-622, p. 380 and H.Rept. 109-72, pp. 103-105.

CRS-32
prices (-$759 million), coalition support (-$300 million), and “lift and sustain” aid
to U.S. allies (-$104 million). These cuts are partly offset by increases for depot
maintenance of upgraded M1A1 tanks for Army National Guard units ($130 million)
and for Marine Corps repair/reset ($100 million). Concerned about the long-term
size of equipment repair requirements, the House Appropriations Committee also
requires DOD to submit a report by May 1, 2006, that would itemize previously
funded spending and estimate requirements in the next three years.
The Senate-passed bill reduces by $1.1 billion DOD’s O&M request — almost
twice the amount cut by the House. Like the House, most of the cuts are for higher
fuel prices (-$813 million), coalition support (-$760 million), “lift and sustain” aid
for allies (-$104 million). The bill also transfers $490 million in monies to counter
IEDs to the new account. These cuts are partly offset by adds for repairs of M1A1
tanks for Army National guard units ($130 million like the House), adds for Air
Force optempo ($194 million) and transportation ($500 million), no reason provided,
plus a $73 million add for family counseling and transition assistance for service
members.
Investment Funding Grows in FY2006 Without Clear Overall
Rationale. In its revised FY2006 supplemental request, DOD requests $14.6 billion
for procurement, $1.7 billion below its original request in addition to the $8 billion
included in the bridge supplemental. The Administration’s proposal does not identify
specific cuts by weapon system but only totals by account so it is sometimes not clear
where the cuts would be taken. If enacted, FY2006 war-related procurement would
total $22.7 billion compared to $18.8 billion appropriated in FY2005.49 Although
some of the decreases in the revised request reflect cuts made, others would reject
adds proposed by the appropriators such as for additional C-17 aircraft. The FY2006
original supplemental request includes the following:
! $3.1 billion for Army modularity equipment;
! $7.2 billion to reconstitute equipment;
! $2.6 billion for force protection items;
! $500 million for classified items;
! $1.2 billion for ammunition; and
! $692 million for SINCGARS radios for “transition teams supporting
OEF/OIF.”50
The supplemental also includes substantial funding for tactical vehicles, such
as High Mobility Multi-Purpose Wheeled Vehicles ($410 million for Army
HMMWVs and $271 million for those of the Marine Corps), night vision devices
($173 million for the Army and $259 million for the Marine Corps), target devices
such as lightweight laser designator rangefinder ($95 million and $113 million for
Knight Family fire support and target designators for the Army), and additional
49 CRS calculations based on DOD, FY 2006 Supplemental Request — war, p. 2; H.Rept.
109-148, p. 468, and H.Rept. 109-72, p. 114. DOD also transferred an additional $2.2
billion from its baseline budget to war-related procurement in FY2005, for a total of $20.9
billion; see table in Appendix A.
50 DOD, FY 2006 Supplemental Request — war, p. 26.

CRS-33
communication aids. Modification kits for aircraft (e.g., AH-64 helicopters in the
Army and AV-8s in the Navy) are also requested. Similar items were included in the
bridge fund, including, for example, over $1 billion for radios of various types.51
Rationales for Procurement Request Unclear. Although DOD’s request
includes descriptions of individual procurement items, it does not give any rationale
or explain whether funding requests for various items reflect battlefield losses,
washout rates for worn equipment, equipment provided for state-side units whose
equipment remains overseas, or additional gear for deployed units. This makes it
difficult to assess whether funding levels are too high, too low or about right. Nor
is it clear whether the Army and Marine Corps, in particular, have additional
unfunded requirements that will come due in later years or whether some of these
items were originally budgeted in the baseline budget but transferred to the
supplemental.
Carryover of FY2005 Procurement Monies. About $6 billion of
procurement monies appropriated in FY2005 remain to be obligated in FY2006. In
addition, much of the $8 billion for procurement in the FY2006 bridge fund is
probably still available.52 If DOD receives an additional $16.4 billion in the FY2006
supplemental, DOD would have as much as $30 billion in procurement monies to
spend in FY2006 in addition to its baseline budget.
As part of its budget review, DOD set a goal that all supplemental procurement
funds should be obligated by the fourth quarter of the fiscal year. In light of the large
amount of funds and the fact that monies are not likely to be available until the third
quarter, it appears unlikely that DOD would reach that goal. Although procurement
monies are generally available for three years, it could be argued that a shorter period
of time would be appropriate for urgently required procurement funds, and would
improve oversight.
Congressional Action. The House bill adds $1.3 billion to the DOD request
for procurement funds, primarily to upgrade and keep open production lines for
M1A1 and M1A2 tanks ($400 million), and buy Tank Urban Survival Kits ($100
million), improved recovery vehicles ($100 million), 8 MQ-1 Predators ($77
million). The measure also proposes to spend $100 million to keep the C-17
production line open even though it is not clear whether additional planes will be
needed.
Preferring to buy new uparmored HMMWVs rather than rebuild old ones, the
House Appropriations Committee swapped $480 million in recapitalization monies
to buy new vehicles, bringing the total for new HMMWVs to $890 million, which
51 Ibid., p. 2; H.Rept. 109-148, p. 468; H.Rept. 109-72, pp. 2, 14-16, 26, passim; see H.Rept.
109-359, pp. 477-482 for FY2006 bridge.
52 CRS calculation of unobligated balances is from comparing amounts appropriated in
FY2005 with obligations in DFAS, Defense Finance Accounting Service (DFAS),
Supplemental & Cost of War Execution Report, September 30, 2005; later reports not
available.

CRS-34
would buy about 6,850 vehicles at about $130,000 each.53 The Committee argues
that buying new vehicles is more appropriate because these would be uparmored
whereas the repaired vehicles would not and therefore would not be usable in
combat. If the recapitalized HMMWVs are not suitable for combat, then it’s not
clear why DOD included that funding in the supplemental. DOD does not show how
their funding request meshes with the Army’s requirements in theater. In recent
years, the Army has received about $3.2 billion to purchase 18,129 uparmored
HMMWVs, which is close to their March 2005 requirement, a requirement which
was increased in late February 2006.54
In its report, the Senate Committee states its concern that DOD’s justification
for war-related procurement “includes only descriptive summaries . . . and is absent
of meaningful program and budget information, such as requirements, pricing and
delivery schedules.” For this reason, the committee warns that “Congress will not
be able to fully support supplemental requests unless it is provided with the same
detailed justification and program materials that is receives with the annual
request.”55
The Senate bill cuts $940 million of DOD’s $16.4 billion procurement request
that includes a transfer of $1.1 billion in Army procurement funds for countering
IEDs to the new centralized Joint IED Defeat Fund (see above). Adds to various
programs are largely offset by cuts elsewhere. The $700 million in cuts includes
programs considered to be duplicative (-$111 million for Explosive Ordnance
Devices, -$30 million for communication equipment), not executable or ahead of
need (-$74 million for UH-1Y/AH-1Z helicopters, -$30 million for Hellfire missiles),
troubled (-$110 million from Joint Network nodes), or questionable (-$145 million
for LOGCAP trucks, trailers, and other equipment).
These cuts are offset by various increases. Like the House, the Senate adds
funds to keep production lines open including $400 million for M1A1Abrams tank
improvements and $228 million for additional C-17 cargo aircraft. The Senate also
adds $230 million to buy three V-22 aircraft, a long-troubled program which recently
completed operational testing, based on the rationale that these planes would replace
CH-46 and CH-53D helicopters that are being damaged or lost in combat. Other
adds are for more Predator UAVs primarily for Special Operations Command ($85
million). Like the House, the SAC adds funds for Abrams Tank Urban Survival Kits
($100 million), and buys new HMMWVs rather than rebuilding current ones.
Research and Development Emphasizes Improvised Explosive
Devices. The revised FY2006 supplemental requests $736 million (rather than
$782 million) in addition to the $50 million in bridge funds. About half — or $357
million — is for DOD’s efforts to counter the effects of all forms of Improvised
53 CRS calculation based on DOD, FY 2006 Supplemental Request - war, p. 24, which shows
that $410 million buys 3,146 HMMWVs.
54 The Army does not cite the new requirement in Army, “Armor Summary,” February 28,
2006, and “Wheeled Vehicle Summary,” March 2006.
55 S.Rept. 109-230, p. 23.

CRS-35
Explosive Devices (IEDs), reflecting the high priority placed on finding ways to
counter these devices. The remaining RDT&E projects appear directed primarily at
enhancing the effectiveness of current systems. The FY2005 supplemental included
$587 million for RDT&E projects. It is unusual for RDT&E funds to be provided in
emergency supplementals because of the long-term nature of the work.
Congressional Action. The House bill provides $1 billion for RDT&E
programs, adding $220 million for classified projects. The SAC transfers $358
million in Army RDT&E funds for countering IEDs to its new centralized transfer
account, adds $320 million for a classified Air Force program, and makes other small
changes. The net effect of these changes is a total of $710 million for RDT&E, $70
million below the request.
Military Construction Request. The revised FY2006 supplemental
requests $406 million for military construction projects, a reduction of $79 million.
The original supplemental includes:
! $348 million for Iraq;
! $80 million for Afghanistan;
! $22 million for planning and design; and
! $35 million for construction to support classified activities in the
United Kingdom.
According to the Defense Department, about $238 million is for force protection, $36
million for airfield improvements, $28 million for fuel facilities, $42 million for
power, water and roads, and $83 million for support facilities. Congress is likely to
scrutinize these individual projects closely because of concerns about the United
States establishing an “enduring presence” in the region.
Congressional Action. The House measure cuts $137 million of DOD’s
$485 million request for military construction, rejecting two projects to fix power
plants at National Security Agency stations in the United Kingdom as non-
emergencies and cutting $107 million from an Army proposal to build new roads in
Iraq to bypass urban areas to avoid Improvised Explosive Devices (IEDs), a rationale
not convincing to the committee.
The House Committee also cites concerns about DOD’s “substantial military
construction expenditures of a magnitude normally associated with permanent
bases,” for “expeditionary” bases that are supposed to be austere. and
“expeditionary.” The Committee believes that military construction requirements for
contingency operations should be considered in regular authorization and
appropriations bills. Concerned about not having DOD’s updated master plan for
Central Command, the House panel also places a hold on military construction funds
until that report is provided.
Echoing the concerns of the house, the Senate Committee report states that
military construction projects should be “of an emergency nature,” and appropriate
for “expeditionary” types of bases in order to be consistent with the “current policy
of the United States to establish no permanent military bases in Iraq;” projects should
be limited to those which “immediately support operations ongoing in Iraq rather

CRS-36
than those requests which propose a longer-term presence.”56 The Senate measure
cuts funds for war-related military construction by $200 million for a total of $278
million.
Except for an air control tower no longer needed, the Senate funds all projects
requested by DOD for Iraq, but at lower levels. The bill cuts most of the funds from
a $167 million Army proposal to build roads bypassing urban areas in order to reduce
the threats from IED (-$128 million), a project also questioned by the House, and
reduces funding for two projects at Talil Air Base, a dining facility and a convoy
support center (-$43 million). The Senate measure also eliminates three projects at
Bagram Air Base in Afghanistan because DOD’s master plan does not take NATO
presence or cost-sharing into account. H.R. 4939, as passed by the Senate, funds two
projects in the U.K. that the House rejected.57
In floor action, the Senate adopted by voice vote the Biden amendment which
prohibits the use of any funds in the act to establish permanent bases in Iraq or U.S.
control of Iraqi oil resources or infrastructure. Citing concerns similar to those in the
House, Senator Biden called for proclaiming a U.S. policy not to set up permanent
bases to clarify various statements by Administration spokespersons and to counter
current Iraqi beliefs.58
Flexibility Issues: Transfer Limits. In the new supplemental, DOD
requests transfer authority that would allow the department to move funds between
appropriation accounts after enactment of up to $4 billion of the $67.9 billion
requested — with the notification and approval of the defense committees. This level
is $1 billion higher than the $3 billion level set for the $75.6 billion in the FY2005
supplemental.
The Department can also transfer up to $2.5 billion of the $50 billion in the
FY2006 bridge fund. The supplemental request also asks Congress to raise the
current transfer limit of $3.75 billion in the regular FY2006 DOD appropriations Act
to $5 billion to allow DOD to respond to unanticipated needs in the global war on
terror. DOD also requested authority to “advance bill” the services for maintenance
or supplies, a way to generate cash reserves for working capital funds, which also
increases flexibility. Congress may wish to consider how much flexibility is prudent
although Congress has approved higher transfer levels in recent years.
Congressional Action. The House measure approves a $2 billion rather
than a $4 billion ceiling on transfers of DOD funds between accounts after enactment
and rejects DOD’s request to allow transfers of military construction funds. The
House Committee also rejects DOD’s request to increase the ceiling on transfers that
applies to DOD’s regular FY2006 funds. The House agreed to raise the limit on
advance billing to $1.5 billion.
56 S. Rept 109-230, p. 46.
57 S.Rept. 109-230, p. 46-47.
58 Congressional Record, May 3, 2006, p. S3957-S3958.

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Like the House, the Senate approves a $2 billion transfer limit on funds in the
bill between all accounts except military construction. Unlike the House, the Senate
agrees to raise the limit on transfers of funds in DOD’s regular bill from $3.75 billion
to $4.35 billion though not to the $5 billion requested by DOD. The Senate bill
agrees to a $1.2 billion limit on advance billion, $300 million less than the House and
$800 million below the request.
Intelligence Community Management Account. The Administration
requests $178 million, in addition to the $418 million already received for FY2006
to “accelerate the stand-up of the Office of the Director of National Intelligence
(ODNI), sustain national Counterterrorism Center (NCTC) Operations, continue
implementation of the recommendations of the Silberman-Robb Commission on U.S.
Intelligence Relating to Weapons of Mass Destruction (WMD Commission), and
rapidly deploy a global capability to warn against the outbreak of avian influenze.”59
Details are classified.
Congressional Action. House and Senate-passed bills each reduce the
request by $20 million for an appropriation of $158 million.
International Affairs Supplemental
The President seeks $4.2 billion in FY2006 supplemental funding supporting
a broad range of foreign policy activities:
! U.S. diplomatic costs in Iraq and Afghanistan
! Additional U.S. stabilization assistance to Iraq
! Additional Afghanistan reconstruction aid
! Public diplomacy and democracy promotion programs for Iran
! Darfur humanitarian relief and peace implementation aid in Sudan
! Pakistan earthquake reconstruction
! Liberia refugee repatriation
! Food assistance for east and central Africa
If enacted as proposed, FY2006 total spending for international affairs programs will
have increased by nearly 50% over levels approved for the international affairs
budget immediately prior to the 9/11 attacks.
59 OMB, FY2006 Supplemental War Request.

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Table 11. State Department and Foreign Aid Funds in FY2006
Supplemental
($s — millions)
Activity (account)*
Request
House
Senate
Conf.
Iraq:a
U.S. mission operations (DCP)
$1,097.5
$1,116.1 $1,037.5
Provincial reconstruction teams support (DCP)
$400.0
$208.0
$300.0
Special Inspector General & State IGb
$25.3
$25.3
$25.3
USAID security and operations (OE)
$119.6
$61.6
$119.6
U.S. Peace Institute
$0.0
$1.3
$0.0
Subtotal, Iraq mission security and support
$1,642.4
$1,412.3 $1,482.4
Provincial reconstruction teams/employment (ESF)c
$675.0
$675.0
$675.0
Infrastructure security (ESF)
$287.0
$287.0
$287.0
Infrastructure sustainment (ESF)
$355.0
$355.0
$355.0
Nat’l capacity building — democracy & rule of law
(ESF)c
$172.0
$172.0
$172.0
Prison construction/Protection of judges (INL)
$107.7
$81.4
$104.4
Financial integration & security promotion (IFTA)
$13.0
$13.0
$13.0
Subtotal, Iraq stabilization assistance
$1,609.7
$1,583.4 $1,606.4
Total, Iraq
$3,252.1
$2,995.7 $3,088.8
Afghanistan:d
U.S. mission security (DCP)
$50.1
$50.1
$50.1
USAID security (OE)
$16.0
$0.0
$16.0
Subtotal, Afghanistan mission security
$66.1
$50.1
$66.1
Power sector projects (ESF)
$32.0
$5.0
$32.0
Debt cancellation
$11.0
$0.0
$11.0
Afghan refugees returning from Pakistan (MRA)
$3.4
$3.4
$7.4
Subtotal, Afghanistan assistance
$46.4
$8.4
$50.4
Total, Afghanistan
$112.5
$58.5
$116.5

Iran:
Public diplomacy/independent TV & radio (DCP)
$5.0
$5.0
$5.0
Iranian student fellowships/visitor programs (ECEP)
$5.0
$5.0
$5.0
Broadcasting (Request = ESF; House/Senate =
$50.0
$36.1
$30.3
BBG)
Democracy programs (Request = ESF; House &
$15.0
$10.0
$34.8
Senate = Democracy Fund)
Total, Iran
$75.0
$56.1
$75.1
Sudan/Darfur:

CRS-39
Activity (account)*
Request
House
Senate
Conf.
USAID mission in Juba (OE)
$6.0
$0.0
$6.0
Refugees returning to southern Sudan (MRA)
$12.3
$12.3
$12.3
Food aid for southern Sudan (PL 480)
$75.0
$75.0
$75.0
U.N. peacekeeping mission in Southern Sudan
$31.7
$31.7
$31.7
(CIPA)
Subtotal, southern Sudan
$125.0
$119.0
$125.0
Humanitarian relief in Darfur (IDFA)
$66.3
$66.3
$66.3
Refugees/conflict victims in Darfur & Chad (MRA)
$11.7
$11.7
$11.7
Food aid for Darfur (PL480)
$150.0
$150.0
$150.0
African Union peacekeeping mission, Darfur (PKO)
$123.0
$173.0
$173.0
U.N. peacekeeping mission in Darfur (CIPA)
$38.1
$98.1
$98.1
Subtotal, Darfur
$389.1
$499.1
$499.1
Total, Sudan/Darfur
$514.1
$618.1
$624.1
Liberia:
Refugee repatriation (MRA)
$13.8
$13.8
$13.8
Economic aid (ESF)
$0.0
$50.0
$50.0
Total, Liberia
$13.8
$63.8
$63.8
Other Refugee Aid (MRA and ERMA)f
$0.0
$0.0
$62.5
Haiti (ESF and CSH)
$0.0
$0.0
$40.0
Congo (Democracy Fund and PKO)
$0.0
$0.0
$13.2
Jordan (ESF)
$0.0
$0.0
$100.0
Pakistan earthquake reconstruction (various)e
$126.3
$126.3
$126.3
Food aid, East and Central Africa (PL480)
$125.0
$125.0
$125.0
Drought relief for West/Horn of Africa (IFDA)
$0.0
$0.0
$35.0
Food aid for refugees through WFP (MRA)
$10.0
$10.0
$20.0
Colombia (House = INL; Senate = MRA & INL)
$0.0
$26.3
$5.8
Hurricane Stan relief for Guatemala (DA)
$0.0
$0.0
$12.0
Rescission of prior aid to Egypt (ESF)
$0.0
$0.0
($47.0)
Rescission (House = Peacekeeping funds; Senate
$0.0
($17.0)
($13.2)
= Export-Import Bank)
TOTAL, State Dept. & Foreign Aid Funds
$4,228.8
$4,062.8 $4,447.9

CRS-40
Source: Department of State and CRS calculations based on H.Rept. 109-388 and S.Rept. 109-230,
with modifications to reflect House and Senate floor amendments.
* State Department appropriation account acronyms: CIPA = Contributions for International
Peacekeeping Activities; DCP = Diplomatic and Consular Programs; ECEP = Educational and
Cultural Exchange Program.
Foreign Operations appropriation account acronyms: ESF = Economic Support Fund; IDFA =
International Disaster and Famine Assistance; IFTA = Treasury Dept’s International Affairs Technical
Assistance; INL = International Narcotics & Law Enforcement; MRA = Migration and Refugee
Assistance; OE = US Agency for International Development Operating Expenses; PKO =
Peacekeeping Operations.
a. In addition to these figures for Iraq, the Defense Department portion of the supplemental includes
$3.7 billion for training and equipping Iraq security forces. The FBI also seeks $32.5 million
for operations and support in Iraq and Afghanistan, the Department of Justice’s United States
Attorneys Office and the U.S. Marshals Service requests $5.5 million in legal support for Iraq’s
criminal justice system, the Bureau for Alcohol, Tobacco, Firearms, and Explosives proposes
$5 million for firearms trafficking, explosives, and arson operations in Iraq, and the Treasury
Department seeks $1.8 million for its participation in the Iraq Finance Cell and to place a
Deputy Treasury Attache in Iraq.
b. Of the $25.3 million request, $1.3 million supports the work of the State Department’s IG in Iraq
and Afghanistan.
c. In addition to new appropriations for these activities, the House bill directs that funds be transferred
from previous Iraq Relief and Reconstruction Fund (IRRF) appropriations for Provincial
Reconstruction Teams ($152 million) and for democracy and rule of law programs ($33.5
million). These amounts are the same as what the Administration had planned to spend for these
activities out of the IRRF account. The Senate bill directs that $104.5 million of ESF for Iraq
should be available for broad-based democracy programs in Iraq.
d. In addition to these figures for Afghanistan, the Defense Department portion of the supplemental
includes $2.2 billion for training and equipping Afghan security forces and $192.8 million for
counter-drug activities in Afghanistan and the Central Asia area. The FBI also seeks $32.5
million for operations and support in Iraq and Afghanistan.
e. Funds would reimburse several USAID accounts — Development Aid, Child Survival,
International Disaster & Famine Assistance, and ESF — for previously reprogrammed money,
plus support ongoing reconstruction projects.
f. The Senate added $42.5 million in MRA funds that included Somalia $3 million; Horn and
W.Africa $10 million; Congo $15 million; UNCHR $4 million; North Caucasus $2.5 million;
North Asia $3 million; and Burma $5 million. In addition, the Senate bill provides $20 million
for Emergency Refugee and Migration Assistance for the Horn of Africa.
U.S. Diplomatic Mission Operations in Iraq60
Currently, the U.S. Embassy in Iraq has over 1,000 American and locally
engaged staff representing about 12 agencies. Of this total, 156 U.S. direct hires and
155 locally engaged staff represent the Department of State (DOS) in the U.S.
Mission. The Bush Administration is requesting an FY2006 supplemental of $1.497
billion within State’s Diplomatic and Consular Programs budget account to cover
Iraq operations and security.
Available FY2006 funds for the U.S. Mission in Iraq’s regular operations
consist of $632.7 million in carryover funds from FY2005. While about $65 million
was requested for FY2006 regular operations for the U.S. Mission in Iraq, the
60 Prepared by Susan Epstein, Specialist in Foreign Policy and Trade.

CRS-41
Department of State says much of that was lost due to rescissions. Therefore, the
Administration is seeking $997.5 million to cover ongoing operation and security
costs for the U.S. Mission in Iraq, $100 million for overhead protection of personnel
in facilities other than the Embassy, and $400 million for movement security of the
Provincial Reconstruction Team. State intends for the carryover and supplemental
total of $1.630 billion to cover costs for the remainder of FY2006 and the first half
of FY2007.
The Department of State estimates the FY2006 total program funding
requirement for Mission operations and security in Iraq to be $1.1 billion. This
includes $192.7 million for logistic support which includes trailer camps, food
service, maintenance of transportation facilities and equipment, and laundry; $70 .8
million for basic operations and logistics for the DOS American direct hires and local
hires; $81.8 million for operational costs for the four regional embassy offices in
Mosul, Kirkuk, Hillah, and Basrah, Provincial Reconstruction Teams and state
embedded teams, as well as contractor support for the Iraq Reconstruction
Management Office, offshore support, public diplomacy, education, and outreach
programs. According to DOS, FY2006 security budget needs total $735.4 million
and include $55 million for guards at facilities in Iraq, $617.9 million for high threat
protection provided to personnel whenever they travel outside of the protected
compound, and $62.5 million for equipment such as armored vehicles, as well as
physical and technical security measures. Additionally, $19.9 million is needed for
information technology operations for a country-wide emergency radio program for
the embassy, the State Department estimates.
Congressional Action. In total, the House bill provides $1.116 billion for
U.S. mission operations in Iraq, an increase of $19 million above the
Administration’s request. H.R. 4939 adds funds for logistics support and information
technology, but reduces amounts for basic operations of the mission. In addition, the
House measure reduces the $400 million request to $208 million for security costs
associated with the Provisional Reconstruction Teams (PRTs) in Iraq. As noted
below, the House bill also blocks new funding for PRT implementation until a pilot
PRT program can be assessed by the State Department. The Senate bill provides
$1.04 billion for U.S. mission operations in Iraq, $60 million less than the request.
The reduction came on an amendment by Senator Menendez that used this account
as an offset in order to increase funds for peacekeeping in Darfur. The Senate
measure also reduces the requested amount for PRT security, setting it at $300
million. The Senate Appropriations Committee notes that the request of $400
million was made prior to a decision to have the Department of Defense provide PRT
security.
For USAID mission security funds in Iraq, the House-passed measure reduces
the request from $119.6 million to $61.6 million. The House Appropriation
Committee noted that the amounts provided are for FY2006, and that the $58 million
balance for FY2007 shall be covered by the transfer of unobligated balances
remaining in the Iraq Relief and Reconstruction Fund (IRRF) enacted in the FY2004
emergency supplemental appropriation act. The Senate bill fully funds the request.

CRS-42
Iraq Stabilization Assistance61
Of the total requested for non-DOD Iraq funding, roughly half — $1.6 billion
— is intended for so-called “stabilization” assistance. By entitling its effort
“stabilization” instead of “reconstruction,” the Administration appears to be
emphasizing that the new funds are not going to be used for actual construction of
economic infrastructure, as nearly 40% of reconstruction funds from all spigots have
been employed previously. For all intents and purposes, however, these funds would
bolster many of the existing economic infrastructure programs currently being
conducted under the Iraq Relief and Reconstruction Fund (IRRF). They would also
provide continued support to the democratization and governance programs that,
along with health, education, and private sector assistance, currently account for
about 22% of all aid to Iraq. In the FY2007 Foreign Operations appropriations
request, the Administration has already proposed an additional $749 million, mostly
for similar democratization and rule of law programs. The training and equipping of
security forces, once funded under the IRRF, and currently accounting for about 38%
of total aid to Iraq, are now supported under the DOD-managed Iraq Security Forces
Fund (ISFF).
The supplemental funding request chiefly appears to address three major issues
of current concern to those implementing the reconstruction program:
! Security. Reconstruction progress has been severely undermined by
the insurgency which has directly targeted key infrastructure for
destruction. The supplemental provides $287 million to help secure
oil, electricity, and water infrastructure.
! Sustainability. As more large-scale construction projects have been
completed with U.S. assistance, there has been increasing concern
regarding the financial and technical capacity of Iraqis to maintain
them in the long run. The supplemental provides $355 million to
assist the Iraqis to operate, maintain, and sustain these projects. In
the past, this has been accomplished largely by providing training
and replacement parts.
! Provincial Reconstruction Teams (PRTs). Following the example
established in Afghanistan, the State Department is seeking to set-up
at least eight PRTs throughout Iraq, up from the three established in
the past few months. PRTs consist of officials from USAID, State,
the military, and other agencies who work with Iraqi local
government committees to identify economic and political
development projects that can be implemented with U.S. financing.
While enabling aid workers to escape the isolation of the “green
zone” and expand outreach to the provinces, they are also viewed as
a way to improve coordination of aid, especially of DOD-CERP
funds and State-controlled funding. Reported concerns regarding the
availability of sufficient “volunteers” to staff the PRTs as well as
61 Prepared by Curt Tarnoff, Specialist in Foreign Affairs.

CRS-43
questions regarding the willingness of the U.S. military to divert
personnel to provide adequate security may hinder their planned
development. The Administration is proposing an appropriation of
$675 million to be disbursed by the PRTs (a separate request of $400
million in PRT operational costs is discussed above).
Table 12. Iraq Supplemental
($s — millions)
FY2006
FY2006
FY2006
FY2007
Activity
Supp.
Supp.
Supp.
Regular
(appropriation account)a
Request
House
Senate
Request
Provincial reconstruction teams/employment
(ESF)b
$675.0
$675.0
$675.0

Infrastructure security (ESF)
$287.0
$287.0
$287.0

Infrastructure sustainment (ESF)
$355.0
$355.0
$355.0
$154.0
Nat’l capacity building-democracy & rule of law
(ESF)b
$172.0
$172.0
$172.0
$112.3
Prison construction/Protection of judges (INCLE)
$107.7
$81.4
$104.4
$1.0
Ministry of Finance technical assistance (IFTA)
$13.0
$13.0
$13.0

U.S. mission operations/Provincial reconstruction
$1,497.5
$1,324.1
$1,337.5
$65.0
teams (DCP)
Special Inspector General & State IG
$25.3
$25.3
$25.3

USAID mission security and operations
(USAID/OE)c
$119.6
$61.6
$119.6

U.S. Peace Institute
$0.0
$1.3
$0.0

Subtotal, Aid and State Department Operations
$3,252.1
$2,995.7
$3,088.8
$332.3
Criminal Justice System Legal Support (DOJ)
$5.5
$3.0
$4.5

Firearms Trafficking, explosives, arson ops
$5.0
$4.1
$4.0

(BATFE)
Iraq Threat Finance Cell and Treasury Attache
$1.8
$1.8
$1.8

(DOT)
TOTAL, Iraq
$3,264.4
$3,004.6
$3,099.1
$332.3
Source: Department of State and CRS calculations based on H.Rept. 109-388 and S.Rept. 109-230,
with modifications to reflect House and Senate floor amendments.
Note: Data in this table reflect ongoing and FY2007 proposed funding for programs the same as or
similar to those requested in the FY2006 supplemental. The TOTAL line does not represent total aid
or mission operations for Iraq. Excluded from this table is $32.7 million requested for FBI operations
in both Iraq and Afghanistan.
a. See Table 11 for listing of appropriation account acronyms.

CRS-44
b. In addition to new appropriations for these activities, the House bill directs that funds be transferred
from previous Iraq Relief and Reconstruction Fund (IRRF) appropriations for Provincial
Reconstruction Teams ($152 million) and for democracy and rule of law programs ($33.5
million). These amounts are the same as what the Administration had planned to spend for these
activities out of the IRRF account. The Senate bill directs that $104.5 million of ESF for Iraq
should be available for broad-based democracy programs in Iraq.
c. The House bill directs that $58 million be transferred from the IRRF to provide USAID mission
security in FY2007.
Like the FY2007 request, the FY2006 supplemental also would provide
significant funding to governance, democratization and rule of law programs at all
levels of government in Iraq. These efforts would include $125 million to help the
Iraqi ministries to improve their ability to operate, $37 million to assist the Iraqi
Special Tribunal that is investigating and trying Saddam Hussein and others, $100
million to construct correctional facilities, and $10 million for broad democracy
activities such as parliamentary and civil society development.
The proposed legislation would also amend the FY2004 supplemental to alter
the allocation of $18.4 billion that had been approved by Congress for each major
reconstruction sector — most recently by statute in September 2004. Periodically,
the allocations had been changed to the extent allowed by law without need for
further legislation. The amendment proposed would give the Administration greater
flexibility by aligning the legislated allocations with current needs, by making
remaining funds available for four years from the current expiration date of end of
FY2006, and by allowing any obligated funds to be reobligated regardless of sectoral
allocation restrictions.
Congressional Action. The House-passed bill nearly fully funds the
President’s request for Iraq stabilization assistance. During floor consideration, the
House adopted an amendment offered by Representative Burton that redirects $26.3
million from Iraq for prison construction and protection of judges in order to increase
funding for Colombia’s counter-narcotics programs.
In addition, H.R. 4939, as passed in the House, rejects the proposed
re-allocation of funds within the IRRF that would have allowed the Administration
greater future flexibility to move funds between sectors. The bill further extends the
expiration date for use of the IRRF by one year to the end of FY2007 instead of to
the end of FY2010 as requested. Also, in what is described by the House
Appropriations Committee as an effort to bring the Iraq program into the structure
of a more traditional foreign aid program, H.R. 4939 includes language that would
transfer from the IRRF into ESF $185.5 million. This amount is equal to that of
IRRF funding previously allocated to projects, such as those supporting the PRTs and
Ministerial Capacity Development, which also are to be funded with new FY2006
supplemental appropriations. In report language, the Committee directed that no new
funding for the PRTs is to be permitted until an assessment of pilot PRTs, a program
plan, and other reporting requirements are met by the Department of State.
The Senate bill fully funds the request at $1.6 billion. Of this amount, the
Senate Appropriation Committee report directs that not less than $75 million be
provided for USAID to continue its Community Action Program that assists local
officials and civil society in democratic decision-making. Of the $75 million, the

CRS-45
report directs that not less than $10 million is for the Marla Ruzicka Iraqi War
Victims Fund. Report language expresses support for USAID’s Iraq Civil Society
Program. Further, through an amendment by Senator Kennedy, the Senate-passed
measure directs that $104.5 million should be used for broad-based democracy
programs, managed by non-governmental organizations in Iraq. Unlike the House
bill, the Senate version does not redirect funds from Iraq assistance to Colombia.
Afghanistan62
The FY2006 supplemental request has several provisions intended to continue
U.S. efforts to stabilize Afghanistan and continue security and economic
reconstruction efforts. The supplemental would be in addition to about $877 million
in total foreign aid previously appropriated for Afghanistan in FY2006. The
supplemental request further follows the Administration proposal for about $1.1
billion in FY2007 aid funds. Key elements of the supplemental request are:
! $16 million for FY2007 security requirements for USAID operations
in Afghanistan;
! $50 million for the State Department for security costs of protecting
U.S. facilities and personnel. This would more than double the
amount already appropriated in regular FY2006 appropriations;
! $3.4 million in refugee assistance to support shelter and ensure food
supplies to Afghan refugees returning from Pakistan. UNHCR
expects that about 730,000 Afghans will return in FY2006, nearly
twice as many as previously estimated. This will augment $36.8
million already allocated to help repatriate Afghan refugees this
year;
! $11 million as a subsidy appropriation that will cover the costs of
cancelling roughly $110 million in debt owed by Afghanistan to the
United States. If not provided in the supplemental spending
measure, the Administration says that it would be necessary to
reallocate existing foreign aid funds for Afghanistan in order to
provide the debt relief; and
! $32 million in ESF for emergency power sector projects needed for
a larger “Northeast Transmission Project” which will supply
electricity to Kabul and other northern cities and reduce
Afghanistan’s need to import diesel fuel.
62 Prepared by Kenneth Katzman, Specialist in Middle Eastern Affairs.

CRS-46
Table 13. Afghanistan Supplemental
($s — millions)
FY2006
FY2006
FY2006
FY2006
FY2007
Activity
FY2005
Regular
Supp.
Supp.
Supp.
Regular
(appropriation account)a
Actual
Enacted
Request
House
Senate
Request
Infrastructure aid (ESF)
$379.2
$145.0
$32.0
$5.0
$32.0
$230.0
Debt relief


$11.0
$0.0
$11.0

Afghan refugees (MRA)
$47.1
$36.8
$3.4
$3.4
$7.4
$38.0
U.S. mission security
$90.5
$47.0
$50.1
$50.1
$50.1
$82.0
(DCP)
USAID mission security
$37.3
$9.7
$16.0
$0.0
$16.0
$13.3
(OE)
Total
$554.1
$238.5
$112.5
$58.5
$116.5
$363.3
Source: Department of State and CRS calculations based on H.Rept. 109-388 and S.Rept. 109-230,
with modifications to reflect House and Senate floor amendments.
Note: Data in this table reflect ongoing and FY2007 proposed funding for programs the same as or
similar to those requested in the FY2006 supplemental. The total line does not represent total aid or
mission operations for Afghanistan. Excluded from this table is $32.7 million requested for FBI
operations in both Iraq and Afghanistan.
a. See Table 11 for listing of appropriation account acronyms.
In addition to proposed foreign aid and diplomatic/security resources, the
Administration further seeks substantial amounts of Defense Department funds for
security force training and counter-narcotics activities. The DOD portion of the
supplemental includes $2.2 billion for an “Afghan Security Forces Fund” to continue
the effort to equip and train the 35,000-member Afghan National Army (ANA) and
55,000-person Afghan National Police (ANP). The ANP is near its target size, but
the building of the ANA has progressed more slowly than expected and it is about
half its target size. In addition, $192.8 million would support U.S. military assistance
to U.S. and Afghan counter-narcotics efforts in Afghanistan. The Defense
Department supports the effort by transporting U.S. and Afghan counter-narcotics
teams, providing search and rescue for them, and other support. Prior to FY2005,
both the security force assistance and counter-narcotics programs were funded out
of the State Department’s budget, not DOD.
Congressional Action. The House-passed measure reduces by roughly half
the request for Afghanistan aid and U.S. diplomatic costs. The measure provides $5
million for the Northwest Kabul Power Plant, but defers consideration of $27 million
for the Northeast Transmission system. The House also defers action on $11 million
for cancelling Afghanistan’s debt owed to the United States and on $16 million for
USAID mission security in the country. In reporting the bill, the House
Appropriations Committee noted that the regular FY2006 appropriation provided
$205 million for infrastructure and other reconstruction that can not obligated until

CRS-47
Secretary Rice certifies that Afghanistan is fully cooperating with poppy eradication
and interdiction efforts. Since the certification has not been issued, the Committee
felt that additional funds should not be provided until it is certain that existing
appropriations will be made available.
The Senate bill provides full funding ($32 million) for the Northwest Kabul
Power Plant and the Northeast Transmission system. It also provides the full $11
billion for debt cancellation. The bill provides requested amounts for State
Department mission and USAID security costs. It increases the Administration’s
request of $3.4 million for refugees returning from Pakistan, by $4 million to $7.4
million.
On related Afghan funding matters, the House bill reduces the $2.2 billion
request out of DOD funds for Afghan security force training to $1.85 billion and cuts
DOD’s request for counter-narcotics activities from $193 million to $157 million.
The Senate measure also cuts Afghan security force training to $1.91 billion and
counter-narcotics programs to $154.6 million.
Iran63
The FY2006 supplemental request would significantly increase funding for pro-
democracy activists in Iran. Although characterized as support for “democracy
promotion,” the funding increase appears to some to reflect a step towards pursuing
a “regime change” option in U.S. policy toward Iran. The request appears to indicate
that the Administration believes that international diplomacy with Iran to curb its
nuclear program is faltering, and that the risks of angering Iran’s government have
been reduced.
The United States began funding Iranian pro-democracy groups in FY2004. The
Foreign Operations appropriation for FY2004 (P.L. 108-199) earmarked up to $1.5
million for “grants to educational, humanitarian and non-governmental organizations
and individuals inside Iran to support the advancement of democracy and human
rights in Iran.” The State Department’s Bureau of Democracy and Labor (DRL) gave
$1 million of those funds to a U.S.-based organization, the Iran Human Rights
Documentation Center, to document abuses in Iran, using contacts with Iranians in
Iran. The FY2005 Foreign Operations appropriation (P.L. 108-447) provided an
additional $3 million for similar democracy promotion efforts in Iran. State’s DRL
says it did not publicly announce winning grantees on security grounds, but that
priority areas were political party development, media development, labor rights,
civil society promotion, and promotion of respect for human rights. The FY2006
Foreign Operations appropriation (P.L. 109-102) expands the program further,
appropriating up to $10 million in democracy promotion funds for use in Iran, drawn
from a “Democracy Fund” and the Middle East Partnership Initiative (MEPI).
On February 15, 2006, Secretary Rice testified before the Senate Foreign
Relations Committee that the Administration plans to seek supplemental FY2006
63 Prepared by Kenneth Katzman, Specialist in Middle Eastern Affairs.

CRS-48
funds totaling $75 million, to be controlled by the State Department, for democracy
promotion in Iran. According to the supplemental request:
! $15 million is to be used to support civic education in Iran and help
organize Iranian labor unions and political organizations (through
such U.S. organizations as the International Republican Institute,
National Democratic Institute, and National Endowment for
Democracy.
! $5 million is to go to Educational and Cultural Exchange Programs
to sponsor Iranian students to visit the United States
! $5 million would be for Internet and other media efforts to reach the
Iranian public.
! $50 million would be used for increased U.S. broadcasting to Iran.
Although these funds are requested under the Economic Support
Fund account, and not through the independent (non-State
Department) Broadcasting Board of Governors, which normally
manages U.S. broadcasting operations, the request seeks authority
to transfer the funds “if necessary,” to Radio Free Europe/Radio
Liberty (RFE/RL)-operated broadcasting services into Iran that
began in October 1998.64 As of December 2002, the radio service
has been called Radio Farda (“Tomorrow” in Farsi), which now
broadcasts 24 hours per day. A U.S.-sponsored television broadcast
service to Iran, run by the Voice of America (VOA), began
operations on July 3, 2003, and now broadcasts three hours a day.
However, the Administration says that some of the funding might be
used for U.S.-based exile-controlled media broadcasting.
Congressional Action. The House-passed bill reduces the $75 million
request to $56 million, cutting amounts proposed for both broadcasting and
democracy programs. Of the $36.1 million for broadcasting, the legislation directs
that $21.4 million shall be available for operations and capital improvements related
to VOA television and that $14.7 million shall be provided to RFE/RL’s Radio
Farda. Instead of providing these funds through the flexible Economic Support Fund
account, the House measure channels the money through the Broadcasting Board of
Governors, the traditional way of funding international broadcasting operations. In
supporting $10 million of the $15 million requested for democracy programs, the
House Appropriations Committee expressed its concern over the lack of sufficient
justification regarding the emergency nature the proposal. Prior to obligating these
funds, the House measure requires the Secretary of State to report to Congress on the
short and long-term U.S. strategy for affecting democracy in Iran.
64 The service began when Congress funded it ($4 million) in the FY1998 Commerce,
Justice, and State Departments appropriation (P.L. 105-119). It was to be called “Radio
Free Iran.”

CRS-49
During floor consideration of H.R. 4939, the House rejected three amendments
— two offered by Representative Garrett and one by Representative Foxx — that
would have collectively deleted $46.1 million of the $56.1 million included in the bill
for Iran programs.
The Senate bill fully funds the $75 million Administration request, although it
prioritizes funding differently. While the request of $50 million for broadcasting was
proposed from ESF funds, the Senate, like the House, appropriates the money
through the Broadcasting Board of Governors, and reduces the amount to $30
million. The Senate bill increases funding for democracy programs, from the request
of $15 million to $34.8 million, and directs the funds to be administered by State
Department’s Middle East Partnership Initiative.
Sudan — Darfur and Other Sudan65
The Administration seeks a total of $514 million in supplemental funds for
Sudan, divided between humanitarian and peacekeeping support in the Darfur region
($389 million) and other parts of Sudan, mainly in support of the North-South Peace
Agreement ($125 million).
Darfur Crisis. The crisis in Darfur began in February 2003, when two rebel
groups emerged to challenge the National Islamic Front (NIF) government in Darfur.
The Sudan Liberation Army (SLA) and the Justice and Equality Movement (JEM)
claim that the government of Sudan discriminates against Muslim African ethnic
groups in Darfur and has systematically targeted these ethnic groups since the early
1990s. The government of Sudan dismisses the SLA and JEM as terrorists. The
conflict in Darfur burgeoned when the government of Sudan and its allied militia
began a campaign of terror against civilians in an effort to crush the rebellion and to
punish the core constituencies of the rebels. Since 2003, an estimated 300,000-
400,000 civilians have been killed, more than two million have been displaced and
currently live in camps, and more than half of the population have been affected
directly and are dependent on international support. The atrocities against civilians
continue in Darfur, according to U.N. reports, U.S. officials, and human rights
groups. Congress and the Bush Administration have called the atrocities genocide.
The African Union has deployed an estimated 7,700 peacekeeping troops, including
military observers and civilian police.
The $389 million supplemental request comes on top of over $500 million in
humanitarian relief provided by the United States to Darfur in FY2005 and roughly
$280 million currently available from FY2006 appropriations. Major elements of the
supplemental request include:
! $66 million for immediate, life-saving needs of victims of the Darfur
crisis, including health care, access to water and sanitation, and
shelter;
65 Prepared by Ted Dagne, Specialist in International Relations.

CRS-50
! $150 million for additional food assistance, an amount that would
meet about 50% of food needs in Darfur and eastern Chad, up from
the roughly 27% level currently;
! $11.7 million in refugee relief in Darfur and eastern Chad;
! $123 million in support of the African Union Mission in Sudan
(AMIS). Although AMIS funding was not requested by the
Administration in the regular FY2006 appropriation cycle, in late
2005 as Congress concluded debate on the Foreign Operations
spending measure, Secretary of State Rice asked that funds be added
to the final bill. While no additional funds were approved, through
reallocations and reprogrammings from other peacekeeping funds,
the State Department has made $33 million available for AMIS thus
far in FY2006; and
! $38.1 million to support the transition of the current African Union
peacekeeping mission in Darfur to a possible UN peacekeeping
operation.

CRS-51
Table 14. Sudan Supplemental
($s — millions)
FY2006
FY2006
FY2006
FY2006
Activity
Regular
Supp.
Supp.
Supp.
(appropriation account)a
Estimate
Request
House
Senate
Darfur:
Humanitarian relief (IDFA)
$40.0
$66.3
$66.3
$66.3
Refugees/conflict victims in Darfur & Chad
$64.0
$11.7
$11.7
$11.7
(MRA)
PL480 food aid
$167.0
$150.0
$150.0
$150.0
African Union peacekeeping mission (PKO)
$13.0
$123.0
$173.0
$173.0
U.N. peacekeeping mission in Darfur (CIPA)
$0.0
$38.1
$98.1
$98.1
Subtotal, Darfur
$284.0
$389.1
$499.1
$499.1
Southern Sudan:
Refugees returning to southern Sudan
$22.0
$12.3
$12.3
$12.3
PL480 food aid
$73.3
$75.0
$75.0
$75.0
U.N. peacekeeping mission in southern Sudan
$247.0
$31.7
$31.7
$31.7
(CIPA)
USAID mission in Juba (OE)
$0.0
$6.0
$0.0
$6.0
Subtotal, Southern Sudan
$342.3
$125.0
$119.0
$125.0
Total, Sudan
$626.3
$514.1
$618.1
$624.1
Source: Department of State and CRS calculations based on H.Rept. 109-388 and S.Rept. 109-230,
with modifications to reflect House and Senate floor amendments.
Note: Data in this table reflect ongoing funding for programs the same as or similar to those requested
in the FY2006 supplemental. The Total line does not represent total aid or mission operations for
Sudan.
a. See Table 11 for listing of appropriation account acronyms.
Congressional Action. H.R. 4939, as passed the House, bill fully funds the
Darfur-related portion of the supplemental, plus adds $110 million in additional
money for peacekeeping operations. The House Appropriations Committee had
added $60 million to the CIPA account for the transition from the current African
Union peacekeeping mission in Darfur to a U.N. mission. The House further adopted
(213-208) an amendment by Representative Capuano increasing the PKO account by
$50 million for AMIS. The total amount provided for Darfur in the House-passed
measure is $499 million.
The Senate-passed bill provides the same increases as the House for the U.N.
peacekeeping mission ($98.1 million) and the African Union peacekeeping mission
($173 million). The increase for U.N. operations came on an amendment by Senator
Menendez, adding $60 million to the requested level, offset by a reduction in State
Department operation costs in Iraq. The total amount provided for Darfur in the

CRS-52
Senate bill is $499.1 million, the same as the House and $110 million more than
requested.
The North-South Peace Agreement and Aid for Non-Darfur Sudan.
On January 9, 2005, the government of Sudan and the Sudan People’s Liberation
Movement (SPLM), after two and half years of negotiations, signed the Sudan
Comprehensive Peace Agreement at a ceremony in Nairobi, Kenya. The signing of
this agreement effectively ended the 21-year old civil war and triggered a six-year
Interim Period. At the end of the Interim Period, southern Sudanese will hold a
referendum to decide their political future. Full and timely implementation of the
peace agreement, however, has been slow, raising concerns about potential conflict
between the two sides. Some important provisions of the agreement have not been
implemented, including commissions, withdrawal of troops, transfer of funds to
South Sudan, and the marginalization of some ministries by the National Congress
Party. Moreover, on July 30, 2005, First Vice President and Chairman of the Sudan
People’s Liberation Movement (SPLM), Dr. John Garang, was killed in a plane crash
in southern Sudan (discussed below). His death triggered violence between
government security forces and southerners in Khartoum and Juba. More than 100
people were killed. In early August 2005, the SPLM Leadership Council appointed
Salva Kiir as Chairman of the SPLM and First Vice President of Sudan. The United
Nations has deployed an estimated 5,500 peacekeeping troops in support of the peace
agreement and the number is expected to increase to 10,715. The United States has
been a key player in the negotiations process and remains active.
The FY2006 supplemental request includes $125 million for southern Sudan
and other areas of the country outside of Darfur:
! $12.3 million to assist in a higher-than-expected level of the return
to southern Sudan of refugees and internally displaced persons. This
would be on top of $28 million planned in the FY2007 refugee aid
budget proposal when another 150,000 refugees are expected to
return.
! $75 million in food aid to support about three million internally
displaced persons and returning refugees throughout Sudan. As in
the case of Darfur, the supplemental package is expected to meet
50% of the food aid needs, compared to existing levels that will
reach only 29% of the target.
! $6 million for opening USAID offices in the capital of South Sudan,
Juba, and Khartoum.
! $31.7 million to increase U.S. support for the U.N. peacekeeping
mission in Sudan (UNMIS). Separately, the Administration seeks
$442 million for UNMIS in its FY2007 regular appropriation
request.
Congressional Action. As passed, the House measure provides full funding
for the aid and peacekeeping portions of the southern Sudan supplemental request
($119 million), but deletes $6 million for USAID offices in Juba and Khartoum.

CRS-53
Since the regular FY2006 appropriation included $6 million for the same purpose,
the House Appropriations Committee felt the emergency nature of the supplemental
request had not been fully justified and the Committee would reconsider the proposal
during the FY2007 review. The Senate bill also fully funds the Administration’s
request for southern Sudan, and provides the $6 million requested for USAID offices.
Pakistan
On October 8, 2005, an earthquake of magnitude 7.6 struck Pakistan, India, and
Afghanistan. Over 73,000 died in Pakistan and 2.8 million became homeless. At a
donors conference in November, the United States pledged a total of $510 million for
earthquake relief and reconstruction, of which $300 million would come from U.S.
economic and humanitarian assistance programs.66
Without additional funds added to the regular FY2006 Foreign Operations
spending measure for earthquake relief, USAID has been drawing on contingency
funds and reallocating existing appropriations to meet emergency requirements for
earthquake victims. The $126.3 million supplemental proposal would replenish
some of these diverted funds, plus provide resources for continuing reconstruction
efforts. The Administration says because of the sizable drawdown — estimated to
be $70 million — from the International Disaster and Famine Assistance account, the
ability of the United States to respond to other global disasters in FY2006 would be
seriously undermined. The $70 million allocation for Pakistan earthquake relief
represents about 17% of USAID’s worldwide emergency disaster budget.
Table 15. Pakistan Supplemental
($s — millions)
FY2006
FY2006
FY2006 FY2006
FY07
FY2005 Regular
Supp.
Supp.
Supp.
Regular
Appropriation Account
Actual
Enacted Request
House
Senate
Request
Int’l Disaster & Famine Assistance


$70.0
$70.0
$70.0

Economic Support Fund
$297.6
$297.0
$40.5
$40.5
$40.5
$350.0
Child Survival and Health
$21.0
$26.9
$5.3
$5.3
$5.3
$21.7
Development Assistance
$29.0
$30.1
$10.5
$10.5
$10.5
$29.0
Total
$347.6
$354.0
$126.3
$126.3
$126.3
$400.7
Source: Department of State and CRS calculations based on H.Rept. 109-388 and S.Rept. 109-230,
with modifications to reflect House and Senate floor amendments.
Note: Data in this table reflect ongoing and FY2007 proposed funding for programs the same as or
similar to those requested in the FY2006 supplemental. The TOTAL line does not represent total aid
for Pakistan.
66 The balance of the pledge was made up of Defense Department in-kind support for relief
operations ($110 million) and assumed U.S. private donations ($100 million).

CRS-54
Congressional Action. Both the House and Senate-passed bills fully fund
the request for Pakistan earthquake assistance in order to reimburse funds that were
previously reprogrammed to meet emergency needs.
Other Foreign Assistance Proposals
Beyond the proposed aid packages for Iraq, Iran, Sudan, and Pakistan, the
Administration also seeks several other foreign assistance items:
! $13.8 million in refugee assistance for the return and reintegration
of Liberian refugees and internally displaced persons. With
elections in November 2005 and the inauguration of a new
government in January 2006, the pace of voluntary refugee returns
has accelerated, with 120,000 expected to return in 2006. The
Administration says that the $13.8 million supplemental would
provide the U.S. “fair share” contribution to U.N. High
Commissioner for Refugees and International Committee for the
Red Cross appeals.
! $125 million in additional PL480 food assistance for FY2006,
primarily to address emerging crises in East and Central Africa.
! $10 million from the refugee account for the World Food Program
in order to avert potential pipeline breaks in refugee feeding
programs in Africa.
Congressional Action. The supplemental measure, as passed in the House
and Senate, provides full funding sought for food aid in East and Central Africa. The
House measure includes $10 million proposed for the World Food Program, while
the Senate doubles the amount to $20 million. For Liberia, both House and Senate
measures include $13.8 million in refugee support, as requested, plus add $50 million
for Liberia economic assistance.
House and Senate bills further address issues not included in the
Administration’s international request. One such item concerns existing conditions
placed on assistance to the Palestinian Authority. During House Committee markup,
the panel adopted an amendment by Representative Kolbe barring any aid to the
Palestinian Authority or any successor entity until the Secretary of State certifies that
such entity is committed to the principles of nonviolence, the recognition of Israel,
and the acceptance of previous agreements and obligations, including the peace
Roadmap. The Senate measure includes a similar provision, but adds a Presidential
waiver of these restrictions based on national security interests. The House
amendment further bans the obligation of existing appropriations for the West Bank
and Gaza until the Secretary, in consultation with the Committee, reviews current aid
programs and provides, by April 30, 2006, a revised plan of assistance. The
Secretary’s revised plan must ensure that U.S. aid is not provided to or through any
individuals or organizations engaged in terrorist activities. The Senate bill does not
include this language.

CRS-55
During floor debate on H.R. 4939, the House adopted (250-172) an amendment
submitted by Representative Burton that redirects $26.3 million in funds requested
for Iraq prison construction and protection of judges to support additional counter-
narcotics requirements in Colombia. Specifically, the $26.3 million would fund the
purchase and operations costs of three D-3 aircraft for use by the Colombian Navy
in interdiction and support missions. The Senate bill does not provide the Colombia
aircraft funding. However, the Senate measure provides $2.5 million in refugee
assistance for Colombia and, as a result of an amendment by Senator Leahy, allocates
$3.3 million for the demobilization process in Colombia. The demobilization funds
are a redirection of money proposed for prison construction in Iraq.
For other items not requested or included in the House bill, the Senate measure
provides $42.5 million for refugee assistance in Somalia, the Horn of Africa, the
Congo, North Caucasus, North Asia, and Burma. The bill further adds $35 million
in ESF for economic development ($10 million), police reform ($10 million), and
judicial and legal reforms ($15 million) in Haiti, and $5 million in CSH for critical
health needs. For the Democratic Republic of the Congo, the Senate bill includes $5
million to support upcoming elections and $8.2 million for training, equipment, and
other assistance for security forces that are supporting peacekeeping operations.
From ESF funds, the bill includes $100 million for Jordan for economic and social
reforms, including infrastructure, training and education. An amendment by Senator
Leahy provides $35 million for drought relief in West Africa and the Horn of Africa,
plus $12 million to assist victims of Hurricane Stan in Guatemala. The Leahy
amendment offsets these added costs by rescinding $47 million in previously
appropriated ESF money for Egypt, an amount that would come from the cash
transfer portion of annual U.S. assistance to Cairo.
Hurricane Recovery and Disaster Supplemental
Overview
On February 16, 2006, the President proposed an FY2006 emergency
supplemental appropriations of $19.8 billion for continuing federal recovery and
reconstruction activities in response to the 2005 Gulf Coast hurricanes, primarily
Hurricane Katrina. These appropriations would be in addition to those supplemental
appropriations already enacted in response to the 2005 hurricanes, including two
FY2005 supplementals — $10.5 billion from P.L. 109-61 (September 2, 2005) and
$51.8 billion from P.L. 109-62 (September 8, 2005).
In addition, Division B of P.L. 109-148, the Department of Defense, Emergency
Supplemental Appropriations to Address Hurricanes in the Gulf of Mexico, and
Pandemic Influenza Act, 2006 (December 30, 2005), provided $28.6 billion for
hurricane relief, of which $23.4 billion was offset by a reallocation from the
Department of Homeland Security Disaster Relief Fund (DRF). Also, the President
has estimated that $8 billion has been approved for tax relief for persons of the Gulf

CRS-56
Coast. According to the Administration, existing funding is estimated to allow the
continuation of hurricane recovery activities through March 2006.67
Of the $19.8 billion requested, most of the funds are proposed for 11
departments and agencies, as shown in Table 16. Under the request, nearly half the
funds — $9.9 billion — are designated for the Department of Homeland Security,
and almost all of those funds would be allocated for the Federal Emergency
Management Agency (FEMA). The Department of Housing and Urban Development
would receive $4.4 billion, most of which would be used for community planning
and development.
The Department of Defense and the Army Corps of Engineers would receive
$3.3 billion ($5.5 billion including the April 25 revision to the request), with these
funds primarily to be used for flood control and coastal emergencies, procurement,
and construction. The Small Business Administration (SBA) would receive $1.3
billion for loans to homeowners, renters, and businesses. The Department of
Veterans Affairs would receive $600 million to replace the VA medical center in
New Orleans. The Department of the Interior would receive $216 million, primarily
for the Fish and Wildlife Service.
On April 25, 2006, the Administration revised its supplemental request. The
revision increases funding for the Army Corps of Engineers by $2.2 billion to assist
in post-Katrina recovery efforts; this amount is offset by a $2.2 billion reduction in
funding requested for the Federal Emergency Management Agency (FEMA) Disaster
Relief Fund.68 Also on April 25, the Administration strongly objected to most
funding increases proposed by the Senate Committee on Appropriations, and
promised that the President would veto any bill providing more than $92.2 billion,
exclusive of supplemental funds for pandemic influenza preparedness.69 In
particular, it singled out funds provided by the bill as reported by the Senate
Committee on Appropriations that were in excess of the amount requested by the
President for FEMA, the Community Development Block Grant (CDBG), highways
and railroad track relocation, agriculture, and the National Oceanic and Atmospheric
Administration (NOAA). It did not specifically object to additional education
funding that is provided in the Senate-reported bill, and it agreed to addition funding
for pandemic influenza preparedness and prevention.
67 For an overview of supplemental appropriations in response to the 2005 hurricanes, see
CRS Report RS22239, Emergency Supplemental Appropriations for Hurricane Katrina
Relief
, by Keith Bea. For a summary of emergency supplemental funding in prior years,
please see CRS Report RL33226, Emergency Supplemental Appropriations Legislation for
Disaster Assistance: Summary Data FY1989 to FY2005
, by Justin Murray.
68 For details, please see:
[http://www.whitehouse.gov/omb/budget/amendments/supplemental_4_25_06.pdf].
69 For details, please see:
[http://www.whitehouse.gov/omb/budget/amendments/supplemental_11_01_05.pdf].

CRS-57
Table 16. Summary of FY2006 Supplemental for Hurricane
Recovery and Disaster Assistance
($s — millions)
Supp.
Supp.
Supp.
Supp.
Department or Agency
Request
House
Senate
Conf.
Department of Agriculture
$55.0
$75.0
$500.0
National Oceanic and Atmospheric
$32.8
$11.8
$1,152.0
Administration
Small Business Administration
$1,254.0
$1,254.0
$1,254.0

Department of Defense
$1,809.4
$1,347.0
$1,743.8a
Army Corps of Engineers
$1,460.0
$1,460.0
$4,001.5

Department of Homeland Security
$9,875.0
$9,905.3
$11,082.9

Department of the Interior
$216.0
$216.0
$296.0

Department of Education
$0.0
$0.0
$881.5
Department of Veterans Affairs
$600.0
$550.0
$623.0

Department of Transportation
$0.0
$0.0
$1,494.0
Department of Housing and Urban
$4,402.0
$4,200.0
$5,402.2

Development
Other Departments and Agenciesb
$59.7
$87.0
$379.7

Total, Title II Hurricane Recovery
$19,763.9
$19,106.1
$28,810.6
Title III Agricultural Disaster
$0.0
$0.0
$3,944.0
Assistance
Title IV Drought Assistance
$0.0
$0.0
$12.5
Title V Port Security Enhancements
$0.0
$0.0
$648.1
Title VI Pandemic Influenza
$0.0
$0.0
$2,589.0
Preparedness
Border Security
$0.0
$0.0
$1,900.0
Veterans Medical Services
$0.0
$0.0
$430.0
Capitol Tunnels
$0.0
$0.0
$27.6
Hawaii Waters
$0.0
$0.0
$1.0
Source: CRS calculations based on S.Rept. 109-230, adjusted for Senate floor amendments.
Note: Totals may not add because of rounding. On April 25, 2006, the Administration revised its
request by increasing the amount for the Army Corps of Engineers by $2.2 billion and decreasing the
request for FEMA at the Department of Homeland Security by the same amount. In a separate
statement, it provided support for supplemental funding for pandemic influenza preparedness. On
May 18, 2006, the Administration revised its request again, by requesting $1.9 billion for border
security, primarily funded through Defense and Homeland Security, and decreasing Defense, primarily
procurement, by the same amount.

CRS-58
a. The Senate adopted an amendment providing $1.9 billion for border security, to be offset by an
unspecified cut of $1.9 billion in DOD funds for both war costs (title I) and hurricane
rehabilitation (title II). The Administration would determine the distribution of the cut among
programs in both titles. Consequently, the $1.74 billion Senate total for hurricane damage
programs could fall somewhere in the range of $0 and $1.74 billion, depending on how the
reductions are allocated.
b. See Table 28 for a listing of other departments and agencies.
Department of Agriculture
As shown in Table 17, the Senate version of H.R. 4939 provides an estimated
$4.4 billion in emergency disaster assistance for all activities and programs
administered by the U.S. Department of Agriculture (USDA), compared with $75
million in the House version of H.R. 4939, and $55 million requested by the
Administration.70
Table 17. FY2006 Disaster Supplemental for Agriculture
($s — millions)
Supp.
Supp.
Supp.
Supp.
USDA Account or Agency
Request
House
Senate
Conference
Executive Operations: National Finance
$25.0
$25.0
$25.0

Center in New Orleans
Office of Inspector General: Audits of
$0.0
$0.0
$0.5

Hurricane Activities
Agricultural Research Service: Research
$20.0
$20.0
$35.6

facilities damaged by hurricanes
Farm Service Agency: Salaries
$0.0
$0.0
$5.0

Emergency Conservation Program
$0.0
$0.0
$32.5

Natural Resources Conservation
Service: Emergency Watershed
$10.0
$10.0
$165.0

Protection
Rural Development: Rural infrastructure
$0.0
$0.0
$186.4

repairs and housing assistance
Forest Service
$0.0
$20.0
$50.0

USDA Subtotal, Title II
$55.0
$75.0
$500.0

Title III: Commodity Credit
Corporation: Emergency Agricultural
$0.0
$0.0
$3,944.0

Disaster Aid a
USDA Total, Titles II and III
$55.0
$75.0
$4,414.0
Source: CRS calculations based on S.Rept. 109-230, adjusted for Senate floor amendments.
a. The Senate bill provides funds for the Commodity Credit Corporation under Title III of H.R. 4939.
70 Prepared by Ralph Chite, Specialist in Agricultural Policy.

CRS-59
The Administration’s request includes $55 million in supplemental funds for the
USDA. Through the USDA Working Capital Fund, $25 million would be for the
National Finance Center for the repair of damaged facilities in New Orleans and
alternate worksites and equipment. USDA Buildings and Facilities would receive
$20 million for the restoration of the Southern Regional Research Center in New
Orleans. The USDA Natural Resources Conservation Center would receive $10
million for the purpose of preventing future losses through the purchase of floodplain
easements.71
Congressional Action. The House bill fully funds proposals for the
Department of Agriculture, and provides an additional $20 million for the National
Forest Service (not requested) to cover the costs of debris cleanup in National Forests
affected by the Gulf Coast hurricanes. The Senate bill includes an amendment
adopted in committee that provides an additional estimated $3.9 billion in disaster
and economic assistance to agricultural producers. Included in this amount is an
estimated $2.1 billion to compensate crop, livestock, and tree producers for a portion
of their production losses caused by any 2005 or 2006 natural disaster, and $1.5
billion in supplemental “economic loss” payments to certain crop producers to
compensate for high energy prices related to agricultural production. In its April 25,
2006 statement of administration policy, the Administration specifically objected to
the additional funds for agricultural assistance that are provided in the bill as reported
by the Senate Committee on Appropriations.72
National Oceanic and Atmospheric Administration73
The President’s FY2006 supplemental request includes $32.8 million for the
National Oceanic and Atmospheric Administration (NOAA), as shown in Table 18.
Table 18. FY2006 Hurricane Supplemental for the National
Oceanic and Atmospheric Administration
($s — millions)
National Oceanic and
Atmospheric Administration
Supp.
Supp.
Supp.
Supp.
(NOAA) Activity
Request
House
Senate
Conference
Operations, Research, and Facilities
$21.0
$0.0
$1,135.0

Procurement, Acquisition, and
$11.8
$11.8
$17.0

Construction
NOAA Total
$32.8
$11.8
$1,152.0

Source: CRS calculations based on S.Rept. 109-230, adjusted for Senate floor amendments.
71 For information on regular FY2006 funding for the USDA, please see CRS Report
RL32904, Agriculture and Related Agencies: FY2006 Appropriations, by Jim Monke.
72 For more information on USDA disaster assistance, please see CRS Report RS21212,
Agricultural Disaster Assistance, by Ralph M. Chite.
73 Prepared by Wayne A. Morrissey, Information Research Specialist.

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The President’s FY2006 supplemental request includes $32.8 million for the
Department of Commerce for two types of activities at the National Oceanic and
Atmospheric Administration (NOAA) — $21.0 million for Operations, Research,
and Facilities (ORF) activities, and $11.8 million for Procurement, Acquisition, and
Construction (PAC) activities. The ORF amount would be used for an assessment
of fishery resources, mapping of fishing grounds for debris removal, rehabilitation
of oyster beds, and promotion of economically sustainable Gulf Coast fisheries. The
PAC amount would be used for the repair and reconstruction of NOAA’s National
Marine Fisheries Service science center at Pascagoula, MS, which provides scientific
support for Gulf Coast fishery management.74
Congressional Action. The House version of the supplemental fully funds
the PAC request of $11.8 million for the repair and reconstruction of a damaged
NOAA science center, but does not agree to the ORF request of $21.0 million
proposed for the assessment and recovery of Gulf Coast fisheries. The Senate
version provides an additional $1.1 billion for the ORF recovery and restoration of
Gulf Coast fisheries operations, and includes $20 million to assist “shellfishermen”
in New England coastal communities affected by the red tide outbreak in 2005. The
Senate Committee version would have increased the PAC amount for the science
center to $20.0 million, and provided an additional $11.8 million to procure an
aircraft equipped with hurricane damage assessment imaging capabilities. A Senate
floor amendment disallows $15 million for NOAA’s National Marine Fisheries
Service that was recommended by the Senate Committee for the promotion of
seafood. In its April 25, 2006 statement of administration policy, the Administration
specifically objected to the additional funds for NOAA that are provided in the bill
as reported by the Senate Committee on Appropriations.
Small Business Administration75
The President’s FY2006 supplemental request for the Small Business
Administration (SBA) is $1.25 billion, as shown in Table 19.
Table 19. FY2006 Hurricane Supplemental for Small Business
($s — millions)
Supp.
Supp.
Supp.
Supp.
SBA Account
Request
House
Senate
Conference
Disaster Loans Program a
$1,254.0
$1,254.0
$1,254.0

Source: CRS calculations based on S.Rept. 109-230.
a. The House bill transfers $712 million of the amount provided for SBA Disaster Loans Program to
the FEMA DRF for reimbursement of funds previously transferred from FEMA to the SBA.
74 For additional information on the funding for NOAA, please see CRS Report RS22410,
The National Oceanic and Atmospheric Administration (NOAA) Budget for FY2007:
President’s Request, Congressional Appropriations, and Related Issues
, by Wayne A.
Morrissey.
75 Prepared by Eric Weiss, Analyst in Financial Institutions.

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Disaster Loans Program. The supplemental request includes $1.25 billion
for the SBA credit subsidy and administrative funds to make loans to homeowners,
renters, and businesses for recovery costs related to the 2005 hurricanes. As of early
April 2006, the SBA had received 403,000 applications from individuals and
businesses for disaster loans. It had approved more than 107,000 of these valued at
over $7 billion. It had made disbursements totaling $671,000 on 39,000 loans. In
addition, the request would authorize the SBA to reimburse FEMA for any funds
previously transferred from the FEMA Disaster Relief Fund to the SBA Disaster
Loans Program Account.
Congressional Action. The House and Senate versions of the supplemental
provide the same amount as requested by the President. In addition, the Senate bill
adds a technical amendment that would transfer $1 million to the University of
Nevada Las Vegas to study and run an international air show. The Senate bill
includes a requirement to transfer to the FEMA Disaster Relief account $712 million
from the supplemental funds provided to the SBA for reimbursement of funds
previously transferred from FEMA to the SBA. The Senate agreed to several floor
amendments regarding the expenditure of funds, eligibility provisions, waivers, and
reporting requirements on expenditures.
Defense Department Supplemental for Repairs, Rebuilding,
and Help for Shipbuilders 76

The Administration’s FY2006 supplemental request for the Department of
Defense (DOD) is $1.8 billion, as shown in Table 20. This amount would be in
addition to the $7.7 billion that DOD has received in two previous hurricane relief
supplementals and the FY2006 DOD Appropriations Act reallocation.77
76 Prepared by Amy Belasco. Thomas Nicola and Henry Cohen, American Law Division,
and Rawle King and Baird Webel, Government and Finance Division, contributed to the
shipbuilding section. Daniel Else, Foreign Affairs, Defense, and Trade Division,
contributed to the military construction section.
77 DOD received $1.9 billion in P.L.109-61 and P.L.109-62 and $5.8 billion in the
reallocation (P.L. 109-148) for a total of $7.7 billion.

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Table 20. FY2006 Hurricane Supplemental for Defense
($s — millions)
Supp.
Supp.
Supp.
Supp.
Defense Activity
Request
House
Senate
Conference
Military Personnel
$69.0
$69.0
$69.0
Operations and Maintenance (O&M)
$123.6
$123.6
$123.6
Procurement & Nat’l Defense Sealift
Fund a
$1,137.4
$889.4
$1,137.4

Research, Development, Test, and
$19.0
$19.0
$19.0

Evaluation
Revolving and Management Funds b
$21.7
$21.7
$21.7

Other Defense Programs
$33.9
$33.9
$34.2
Military Construction
$404.8
$190.4
$338.9

Defense Total
$1,809.4
$1,347.0
$1,743.8 c
General Provision: reducing DOD
war & hurricane funds c

-.-
-.-
($1,900.0)c
Source: CRS calculations based on S.Rept. 109-230 and Senate amendments.
Note: On May 18, 2006, the Administration revised its proposal by requesting $1.9 billion for border
security, primarily funded through Defense and Homeland Security, and reducing Defense, primarily
procurement, by an equal amount.
a. Includes $1.02 billion in procurement and $11 million in National Defense Sealift funds primarily
to reimburse shipbuilders for higher costs due to “business disruption.”
b. Includes funds to repair and rebuild commissaries.
c. The Senate adopted an amendment providing $1.9 billion for border security, to be offset by an
unspecified cut of $1.9 billion in DOD funds for both war costs (title I) and hurricane
rehabilitation (title II). The Administration would determine the distribution of the cut among
programs in both titles. Consequently, the $1.74 billion Senate total for hurricane damage
programs could fall somewhere in the range of $0 and $1.74 billion, depending on how the
reductions would be allocated.
Like the previous hurricane-related supplementals, this request would direct
additional funds to repair and replace equipment, rebuild facilities and infrastructure
on bases damaged by the hurricanes, provide benefits to displaced military personnel,
and give the Navy more money to pay estimated increased shipbuilding costs
associated with labor delays and disruption of operations at damaged shipyards in
New Orleans and Pascagoula. The current request does not include more funds to
activate reservists or support active-duty personnel who were deployed to provide
initial rescue and recovery efforts, or for evacuation of DOD personnel.78
78 See, Department of Defense FY2006 Hurricane Katrina & Rita Budget Reallocation
Request and Rescissions
, November 2005; CRS Report RL33197, Reallocation of Hurricane
Katrina Emergency Appropriations: Defense and Other Issues
coordinated by Amy Belasco.
See also Table 2C in CRS Report RL32924, Defense: FY2006 Authorization and
(continued...)

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The main elements in the supplemental request are:
! $1.02 billion for higher shipbuilding costs in addition to the $1.7
billion already provided;
! $115 million for military benefits, including higher Basic Allowance
for Housing for military personnel in the affected areas, health care
support, commissary rebuilding, and personal claims;
! $202 million for additional repair and replacement of equipment in
addition to the $550 million already received;
! $63 million to restore facilities in addition to $660 million in
previously appropriated funds; and
! $405 million for military construction in addition to the $1.4 billion
already received.79
Congressional Action. The House bill provides a total of $1.3 billion for
hurricane-related damages to DOD facilities, a $520 million reduction to the $1.8
billion request. The House cuts reflect a $250 million cut to DOD’s $1 billion
request to reimburse shipbuilders for higher costs — a controversial issue — and a
$210 million cut to military construction projects proposed by the services. The
SAC would provide $1.7 billion, providing the full amount to reimburse shipbuilders
and cutting $65 million from military construction projects. Both houses approve the
DOD request for military personnel, O&M, and procurement funds to pay for
hurricane-related damages and costs.
The Senate bill would provide $1.7 billion — less some unspecified portion of
the $1.9 billion cut to defense funds to be distributed by the Administration to pay
for an additional $1.9 billion provided for border security. As passed, the bill
provides the full amount to reimburse shipbuilders and cuts $65 million from military
construction projects. In floor action, the Senate rejected an amendment proposed
by Senator Coburn to delete Section 2303, which could broaden the Navy’s liability
for higher shipbuilding costs (see below). Both houses approve the DOD request for
military personnel, O&M, and procurement funds to pay for hurricane-related
damages and costs.
Who Should Pay for Higher Costs Due to Delays in Shipbuilding.
In the earlier reallocation of Katrina funds (P.L. 109-148), Congress provided $1.7
billion to reimburse shipbuilders (primarily Northrop-Grumman) for estimated
increased costs for ships under construction at Ingalls Shipyard in Pascagoula,
Mississippi, and Avondale shipyard in New Orleans. At the time, however, House
and Senate Appropriations Committees raised concerns about Navy reimbursement
plans primarily because of the difficulties in segregating the costs that should be
borne by the contractor’s insurance vs. the costs to be borne by the government. The
78 (...continued)
Appropriations, by Stephen Daggett for an appropriation account breakdown of DOD’s
reallocation request.
79 CRS calculations based on DOD, FY2006 Supplemental Request for Hurricane Katrina
and Other Hurricanes of the 2005 Season, February 2006
, passim,
[http://www.dod.mil/comptroller/defbudget/fy2007/FY06-Hurricane-Supp.pdf].

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contractor carries insurance to protect its profits against “business interruption” and
therefore its insurance company may be liable for higher costs incurred because of
downtime and lower productivity of the shipyard workforce, additional overhead
charges and higher inflation costs due to delays. All of these circumstances —
associated with the damage to the two shipyards — could cut into contractor profits
if the government did not reimburse related costs. The FY2006 supplemental
includes an additional $1 billion for higher costs for a total of $2.7 billion.
Last year, the House and Senate Appropriations Committees raised concerns
about the Navy’s reimbursement plans primarily because of the difficulties in
segregating the costs that should be borne by the contractor’s insurance vs. the costs
to be borne by the government. According to the Navy’s original estimate, from
$1.1 billion to $1.5 billion of the estimated higher costs could be due to business
disruption costs, some of which could be covered by insurance claims.
The contractor carries insurance to protect its profits against “business
disruption,” and therefore its insurance company may be liable for higher
shipbuilding costs incurred because of downtime, lower productivity, additional
overhead charges, and higher inflation costs due to delays. All of these
circumstances — associated with the damage to the two shipyards — could cut into
contractor profits if the government did not reimburse those costs.
To ensure oversight, the Appropriations Committees last year required that the
Navy (or Army) Secretary submit a report certifying that the higher shipbuilding
costs are:
! required to be incurred for hurricane relief;
! not subject to reimbursement by any third party (e.g., FEMA or
private insurer); and
! directly allocable to the program for which funds are being
provided.80
Although there does not appear to be any standard definition of what is required for
a defense official to certify to these conditions, the following questions might need
to be answered to demonstrate that the Navy is turning to the government as a last
resort to reimburse these higher costs.
(1) Has the contractor submitted and received rejections from insurers for its claims
for reimbursement for business interruption? If so, has the contractor challenged the
rejection in court and what has been the outcome of the challenge?
(2) What types of expenses does “business interruption” insurance cover and what
types of expenses does it not cover? How do these criteria relate to the expenses
incurred at the shipyard?
80 H.Rept. 109-359 in Congressional Record, December 18, 2005, pp. H. 12630, H12631.
See CRS Report RL33197, Reallocation of Hurrican Katrina Emergency Appropriations:
Defense and Other Issues
, coordinated by Amy Belasco, for a complete discussion of this
oversight issue.

CRS-65
(3) Can the Navy demonstrate that delays incurred are associated with Gulf Coast
hurricanes rather than other problems with a shipbuilding program by showing work
plans before and after the hurricane?
(4) Can the Navy demonstrate that the expenses were unavoidable, i.e. that the
contractor has made maximum efforts to avoid delays and disruption by
subcontracting work to other locations or relocating personnel?
Congress may want to clarify the standards required for the Navy to certify that
such additional expenses were unavoidable, directly associated with the Gulf Coast
hurricanes , and not payable by a third party and apply such criteria both to the $1
billion in this new request and the $1.7 billion appropriated in the earlier reallocation
(P.L.109-148). Congress may also want to ask the Navy to refine its initial estimate
— made in the third week of September 2005 — only three weeks after Hurricane
Katrina struck. The $1 billion supplemental request, together with the $1.7 billion
already enacted, is identical to that original estimate.81
Congressional Action. As passed, the Senate bill provides the $1.02 billion
requested by the Navy to reimburse its contractors for higher costs associated with
the hurricane damage at Ingalls, MS, and Avondale, LA, shipyards, and includes a
new Section 2303 that could expand the liability of the Navy to cover business
disruption costs. The Administration urges the elimination of Section 2303, arguing
that “it would require the Navy to cover shipbuilding costs that are routinely borne
by private insurance, creating an incentive for insurance companies to deny payments
... [and would expand] the scope of the Navy’s liability ... [and] limit flexibility in
future contract negotiations because shipbuilders could claim business disruption for
years to come,” including costs of “any affected shipyard — including those
completely unrelated to DOD.”82
In floor action, the Senate rejected by 48 to 51 an amendment proposed by
Senator Coburn that would have removed Section 2303 of the bill which would
require the Navy to renegotiate contracts to pay the costs of “any business disruption
incurred by a ship construction contractor” due to Hurricane Katrina.83 Senator
Coburn argued that advance payment by the Navy of such costs would make it
unlikely that Northrop Grumman would collect from its insurer for those losses.84
This is likely to be a contentious conference issue because the Senate language is not
included in the House bill and House report language emphasizes that the Navy
81 Assistant Secretary of the Navy, John J. Young, Memorandum for Deputy Secretary of
Defense (Acting), “Hurricane Katrina,” September 21, 2005.
82 OMB, “Statement of Administration Policy, H.R. 4939 — Emergency Supplemental
Appropriations Act for Defense, the Global War on Terror, and Hurricane Recovery, 2006,”
April 25, 2006 (Senate), p.3;
[http://www.whitehouse.gov/omb/legislative/sap/109-2/hr4939sap-s.pdf].
83 Section 2303 (a) and (c) in H.R. 4939 as marked up by the Senate Appropriations
Committee.
84 See Congressional Record, May 2, 2006, p. S3865 for comments by Senator Coburn.

CRS-66
should be sure not to reimburse the contractor for costs that could be covered by
insurance.
In floor debate, Senator Cochran defended Section 2303, contending that the
language provides that the government would be reimbursed for any insurance
monies received by the contractor. In floor debate, Senator Cochran defended
Section 2303, contending that if the Navy paid up front, “with the possibility of
insurance proceeds offsetting Government costs,” the estimated $140 million cost of
the provision would be less than the cost of a three-to-six month delay in
shipbuilding. Senator Cochran also emphasized that the $140 million would come
out of the total of $2.7 billion requested by the Navy, a position that the Navy might
dispute.85
Section 2302 would:
! allow the Navy to “pay the costs of any business disruption incurred
by a ship construction contractor” associated with Hurricane
Katrina;
! require the Secretary of the Navy to adjust contracts to take into
account such business disruption costs;
! declare that if the government pays the contractor for such damages,
those amounts may not be used to “reduce payments otherwise
payable,” i.e. payments that would be the insurance company’s
responsibility, or allow the contractor to collect from both the
government and the insurance company; and
! require the contractor to reimburse the government for any insurance
payments received with the monies credited to the original account.86
In its report, the Senate Appropriations Committee states that it “is in the best
interest of the Department of the Navy and national security to restore compromised
shipyard capability,” and “also ... to ensure industry seeks reimbursement by
insurance companies to the maximum extent.” The report also states that the
committee expects the shipbuilders to reimburse the Navy for any insurance receipts
received for business disruption costs.87
Section 2303 could expand the types of costs that the Navy would be liable to
pay, reduce the Navy’s bargaining leverage with its contractors, and affect the
contractors’ resolve in negotiating with its insurer. This new language would require
the Navy to renegotiate its current contracts with Northrop Grumman to cover
business disruption losses — chiefly additional labor hours and overhead — for ships
being built in the existing shipyards. The Navy is expected to face pressure from
Northrop Grumman to pay business disruption costs in advance with the contractor
85 See Congressional Record, May 3, 2006, p. S3866. The $2.7 billion includes $1.7 billion
provided in P.L.109-148 and the $1 billion in the FY2006 supplemental request.
86 Section 2303, H.R. 4939 as marked up by the SAC; the bill says that any amounts received
by the contractor for business disruption may not be “treated as collateral insurance,” which
means recovered from more than one source.
87 S.Rept. 109-230, p. 62.

CRS-67
required to reimburse the government in the event that it receives monies from its
insurer.
If the Navy pays these costs, however, the insurer could argue that it no longer
needed to reimburse Northrop because it would not have suffered a loss. In fact, the
language in Northrop’s policy with Factory Mutual states that “The company will not
be liable for any loss to the extent that the Insured has collected for such loss from
others.”88 Thus if Northrop collects from another source (in this case, the Navy), then
the insurance company or the court might decide that the company has not suffered
a loss and hence could not collect from in its insurer. The Senate language mirrors
a proposal recently made by Northrop Grumman, the primary contractor affected.89
Although Northrop Grumman argues that the advance agreement and relevant
court case would ensure that the government would be reimbursed “if the insurance
carriers were required to pay for that loss,” they acknowledge that the insurance
companies “potentially may argue that they are entitled to a set-off of the amounts
paid by the government.”90 An advance agreement could also allow Northrop to be
reimbursed for certain losses not covered by insurance.
Recently, Assistant Secretary of the Navy Delores Etter said that “it would not
be a good precedent” for the Navy to pay for insured damages in advance “because
we don’t think the insurance companies are as likely to follow through if we’ve
already covered it for them.”91 This view reflects an earlier policy memorandum
from the Office of the Secretary of Defense advising the Navy “to ensure that the
Government does not approve payments for contractor costs associated with
Hurricane Katrina until all avenues for recovery from insurance carriers have been
exhausted, conditionally allowable, there is a risk that insurers will deny coverage on
the basis that there has been no loss suffered by the contractor.” DOD’s current
acquisition regulations prohibit the payment of costs that would be covered by
insurance.92
Without the new language, the Navy’s liability for business disruption costs
would be capped for fixed price contracts and limited to certain types of costs based
on federal acquisition regulations though defining types and amounts of costs could
be difficult to determine. In the case of fixed price contracts, the Navy’s liability for
additional labor hours or overhead costs is limited by the ceiling (top) price in the
contract. Up to the ceiling price, the Navy and the contractor share cost overruns (by
88 Northrop Grumman, “Hurricane Katrina White Paper,”February 21, 2006, p.7.
89 Northrop Grumman, “Hurricane Katrina Supplemental,” and “Hurricane Katrina White
Paper,”February 21, 2006.
90 Northrop Grumman, “Hurricane Katrina Recovery White Paper,” February 21, 2006, p.
15.
91 Defense Today Instant Update, “Etter Says Navy Won’t Pay for Northrop Damage That
Was Insured,” March 30, 2006.
92 As quoted in memorandum from Donald P. Springer, Defense Corporate Executive,
Defense Contract Management Agency, “Proposed Advance Agreement Related to Certain
Costs Incurred As a Result of Hurricane Katrina,” April 12, 2006.

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50:50 or some other ratio), with the contractor’s profits being reduced as costs
increase.
Once costs exceed the ceiling price, the contractor is liable for any additional
costs. For all costs above those anticipated before the hurricanes for which they
would be liable, Northrop Grumman will presumably submit a claim to its insurance
company to pay those costs in order to protect its profits. The primary issue is who
covers those costs and at what point in time. The types of costs that would be
considered related to “business disruption” is also likely to be contentious with the
new language in Section 2303 potentially broadening the definition in current
acquisition regulations.
For cost plus contracts, the government is liable for higher costs as long as there
are appropriations available to pay those costs. If business disruption costs exceed
funding currently available, the Navy could request additional funds.
Part of the issue appears to revolve around timing. Northrop Grumman argues
that advance payment would be helpful because business disruption claims could take
years to settle. On the other hand, the very act of the government paying those claims
could undermine both the contractor’s resolve to negotiate with and to challenge its
insurers claims in court. At the same time, advance payment could also potentially
make it more difficult for Northrop to get payment under its insurance policy.
A significant issue raised by the new language is the precedent that might be
set if the government pays in advance for “any business disruption” [italics added]
claims, which suggests that the government would be liable for all rather than only
some types and amounts of business disruption expenses. Determining business
disruption costs — for example, deciding whether shipbuilding delays are due to
hurricane damages or technical problems, or deciding whether particular types of
expenses (e.g. administrative leave for employees) would be considered allowable
— is inherently problematic. The new language, however, appears to expand the
government’s liability.
Concerned about the accuracy of Navy estimates and potential overlap with
private insurance claims, the House bill cuts $250 million from the Navy’s $1 billion
request for additional funds to reimburse shipbuilder Northrop Grumman for
estimated higher shipbuilding costs resulting from the damage to Avondale, LA and
Ingalls, MS shipyards. The Navy would still have almost $2.5 billion — including
the $1.7 billion provided in the Katrina reallocation — for these costs.
The Committee “believes strongly that funds in this act and under this heading
in prior Acts should not be used to substitute for private insurance benefits,” and
notes that shipyards have “business interruption” insurance that could overlap with
these funds.93 As in previous conference report language, the Committee again
requires that the Navy not obligate funds unless it can certify that these costs would
not be reimbursed by a third party. The Committee notes that the Navy submitted a
93 House Committee on Appropriations, Draft Report, p. 58.

CRS-69
certification applying to funds already received that there was no overlap on March
1, 2006.
Military Construction. The President’s FY2006 supplemental request
proposes $405 million to replace military facilities destroyed by the 2005 Gulf Coast
hurricanes. DOD already received $1.4 billion in the Hurricane Katrina reallocation
in P.L. 108-148. Not all of the $405 million is new funds. The Administration
proposes to extend the availability through FY2010 of $234 million that was
previously appropriated in the Hurricane Katrina reallocation but was only available
through FY2006. Presumably, DOD wants to increase the life of these monies to
replace Naval Reserve and Army National Guard facilities because it does not expect
to obligate the funds this year and the funds would therefore lapse.
The $405 million requested is for:
! $53 million to replace and relocate facilities at Navy centers at
Gulfport and Bay St. Louis, Mississippi (fitness and recreation
centers, exchange, and barracks for international students);
! $111 million to construct Air Force facilities at Keesler Air Force
Base, Mississippi (fire/rescue center, exchange, base library, aircraft
maintenance hanger);
! $24 million to construct Naval Reserve facilities in New Orleans,
Louisiana (consolidated public works center, hardened command
and control center, and crash/rescue center);
! $210 million to replace Army National Guard facilities in Louisiana
(Joint Force Headquarters, Readiness Center, and aviation support
facility); and
! $6 million to replace Air National Guard facilities in Mississippi
(storm water system and medical training center).
As was the case in the Hurricane Katrina reallocation, the appropriators are likely to
scrutinize these military construction requests to ensure that there is no overlap with
funds already received in the Hurricane Katrina reallocation (e.g., the $53 million for
Keesler and the $212 million for Gulfport) or with plans for base closures and
consolidations (e.g., consolidated Naval Reserve public works center that would
support both the Naval Air Station in New Orleans and the Naval Support Activity
slated for realignment).
Congressional Action. The House-passed bill cuts DOD’s request for
military construction monies by $214 million, disapproving $142 million for Army
National Guard projects that were submitted too late to be considered, reducing
funding for a Navy fitness center by $9 million, reducing Air Force planning and
design monies by $14 million, and rescinding $49 million for Navy Reserve projects
no longer needed. During floor consideration, the House adopted an amendment by
Representative Taylor, restoring $55.9 million to rebuild Navy and Air Force
exchanges that had been cut by the House Appropriations Committee. The
Committee said in its report that the services could use non-appropriated funds to
rebuild exchanges, as is the general practice.

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The Senate measure reduces DOD’s military construction request from $405
million to $339 million, above the $190 million provided by the House. The smaller
reductions by the SAC reflect its funding of Army National Guard projects —
disapproved by the House — and its smaller cut to Air Force planning and design
funds.
Request for Increased Flexibility to Transfer Funds. DOD is
requesting broader authority than is typically permitted by Congress to transfer funds
between appropriations accounts after enactment. The supplemental proposes that
DOD be allowed to transfer funds among all accounts — including military
construction — both for funds in the current request and those in the previous
Hurricane Katrina reallocation. Last year, Congress permitted transfers among all
accounts except for military construction, where funds are typically designated at the
project level. DOD is proposing a transfer limit of $300 million for the current
request and retaining the $500 million transfer limit adopted in Hurricane Katrina
reallocation funds.
Other Funding for Hurricane Damages. Both the House and the Senate
Appropriations Committee endorse DOD’s requests for military personnel, operation
and maintenance costs, and procurement costs associated with hurricane damage.
Army Corps of Engineers94
The Army Corps of Engineers typically receives indirect funding through FEMA
for its public works and engineering mission assignments (e.g., debris removal and
demolition) under the National Response Plan. In addition, Congress appropriates
funds directly to the Corps for some emergency response and repair activities.95 As
shown in Table 21, the President’s initial FY2006 supplemental request for the
Corps’ direct funding is $1.5 billion; the House version of the supplemental provides
the amount requested by the Administration, while the Senate version is higher, at
$4.0 billion.
For much of its emergency response and recovery activities, the Army Corps of
Engineers in its assignment for its public works and engineering mission (e.g., debris
removal and demolition) under the National Response Plan receives indirect funding
through FEMA; these funds are tracked as part of FEMA’s appropriations. In
addition, Congress appropriates funds directly to the Corps for some emergency
response and repair activities. As shown in Table 21, the President’s FY2006
supplemental request for the Corps’ direct funding initially was $1.5 billion,
requested on February 16, 2006. Subsequently, the Administration revised its request
on April 25, 2006, asking for an additional $2.2 billion for work to enhance the
performance of levees in the New Orleans area to provide protection from a 100-year
coastal storm-induced flood event. The additional $2.2 billion would be offset by a
reduction to FEMA by the same amount. The House version of the supplemental was
94 Prepared by Nicole Carter, Analyst in Natural Resources Policy. The Army Corps of
Engineers is under the budget category, Department of Defense, Civil.
95 For background information, please see CRS Report RL33188, Protecting New Orleans:
From Hurricane Barriers to Floodwalls
, by Nicole T. Carter.

CRS-71
passed prior to the revised request; it provides the $1.5 billion initially requested by
the Administration. The Senate version was passed on May 4, 2006, and includes the
combined $3.7 billion requested by the Administration and more than $300 million
more for activities not requested by the Administration in California, Hawaii,
Louisiana, Pennsylvania, and Texas.
Table 21. FY2006 Hurricane Supplemental for the Army Corps
of Engineers
($s — millions)
Supp.
Supp.
Supp.
Supp.
Army Corps of Engineers Activity
Request
House
Senate
Conference
Investigations
$0.0
$0.0
$47.5

Construction
$100.0
$100.0
$634.3

Operation and Maintenance
$0.0
$0.0
$3.2

Flood Control and Coastal Emergencies
$1,360.0
$1,360.0
$3,316.5

Army Corps of Engineers Total
$1,460.0
$1,460.0
$4,001.5
Source: CRS calculations based on S.Rept. 109-230, adjusted for Senate floor amendments.
Note: On April 25, 2006, the Administration revised the FY2006 supplemental request by proposing
an additional $2.2 billion for the Army Corps of Engineers; the extra amount would be offset by a
reduction to FEMA by the same amount.
Through the supplemental appropriations and reallocation efforts in response
to the 2005 Gulf Coast hurricanes, Congress already has appropriated $3.3 billion
directly to the Corps. The amounts in Table 21 would be in addition to the $3.3
billion already appropriated.
The President’s combined FY2006 supplemental request of $3.7 billion for the
Corps includes $3.6 billion for hurricane and related flood protection improvements,
and $100 million for wetlands restoration of areas affected by navigation channels.
The request designates how the $3.6 billion would be distributed across various
storm protection activities:
! $1,584 million for reinforcement and repair of floodwalls in the New
Orleans areas;
! $495 million for raising levee heights of two hurricane protection
projects in the New Orleans area;
! $530 million for modification, closure, and pumping improvement
of drainage canals in New Orleans;
! $250 million for improved protection of interior pumps in the area;
! $170 million for fortifying critical elements of New Orleans’ levees
and floodwalls;

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! $350 million to improve hurricane protection along the Inner Harbor
Navigation Canal that cuts through from the Mississippi River to
Lake Pontchartrain; and
! $215 million to incorporate the local levees in Plaquemines Parish
into the federal levee system, which would transfer responsibility for
storm damage repairs from the local levee districts to the federal
government.
Congress has directed the Corps how to use much of the $3.3 billion already
provided. Of the $3.3 billion, $980 million is for repairing existing hurricane
protection, flood control, and navigation infrastructure, and $1.59 billion is for
restoring the existing hurricane protection infrastructure to its design level of
protection, that is, protection from a fast-moving Category 3 hurricane. The agency
was also directed to use $540 million for completing authorized hurricane protection
projects in Louisiana that were yet to be completed when the 2005 hurricanes struck,
and $70 million for investing in natural disaster preparedness and mitigation
activities. Also, $55 million was allocated for various Corps studies, including
investigations into restoring Louisiana’s coastal wetlands, increasing the level of
hurricane protection for coastal Louisiana, and addressing Mississippi’s water
resource needs. These studies may conclude with recommendations for additional
investment of federal resources in the affected Gulf States.
The FY2006 supplemental request would provide $100 million for wetlands
restoration. This amount would augment the $75 million of reallocated FY2005
hurricane supplemental appropriations directed to Corps activities to help preserve,
protect, and enhance Gulf Coast wetlands, as well as the $11 million in FY2005
supplemental reallocation appropriations and $10 million in Corps FY2006
appropriations (P.L. 109-103) for a study of restoring coastal Louisiana’s wetlands.
This study likely will borrow elements from earlier studies conducted by a variety of
federal, state, and local entities that had recommended federal investments in Gulf
Coast wetlands protection and restoration; these earlier studies have recommended
investment packages to respond to coastal wetlands loss that range from $2 billion
for near-term actions, to $14 billion for a more comprehensive approach.
Congressional Action. The House bill fully funds the President’s initial
FY2006 supplemental request for the Army Corps of Engineers, but the bill was
approved before the additional request of $2.2 billion was submitted to the Congress.
The Senate bill provides not only the funds requested in both FY2006 supplemental
requests, but also $107 million in additional funding for the Corps, including $25
million for Louisiana Coastal Area Restoration studies and $20 million for a national
levee inventory. The Senate bill also includes an additional $1,669 million added by
a Senator Domenici amendment primarily for rebuilding the levees in the New
Orleans area.
Although there exists a sense of urgency for fortifying hurricane protection in
coastal Louisiana, some have indicated that the complex mix of existing Corps
emergency and project-specific authorities raises questions regarding the Corps
authority to proceed with the activities specified in the President’s FY2006
supplemental requests. The House bill specifies that the appropriations “shall be
subject to authorization.” The Senate bill does not include an authorization

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requirement. The Senate bill does require that funds provided in the bill that are
above the President’s request must be subject to “an official budget request.”
Department of Homeland Security
The President’s FY2006 supplemental request for the Department of Homeland
Security (DHS) is $9.9 billion, as shown in Table 22. The Homeland Security Act
of 2002 (P.L. 107-296) transferred the functions, relevant funding, and most of the
personnel of 22 agencies and offices to the DHS, which was created by the act. The
FEMA and the United States Coast Guard (USCG) were among the agencies
transferred to DHS.96
Table 22. FY2006 Hurricane Supplemental for Homeland
Security
($s — millions)
Supp.
Supp.
Supp.
Supp.
DHS Agency
Request
House
Senate
Conference
FEMA, Disaster Relief Fund
(DRF) a
$9,400.0
$9,548.0 $10,400.0

FEMA Disaster Asst Direct Loan
(DADL) Program a
$301.0
$151.0
$301.0

FEMA, Other
$75.0
$80.0
$81.8

United States Coast Guard
$69.5
$95.1
$282.4

Customs and Border Protection
$16.0
$17.7
$17.7

Office of the Inspector General
$13.5
$13.5
$0.0

DHS Total
$9,875.0
$9,905.3 $11,082.9
Source: CRS calculations based on S.Rept. 109-230, adjusted for Senate floor amendments.
Note: On April 25, 2006, the Administration revised the FY2006 supplemental request by proposing
an additional $2.2 billion for the Army Corps of Engineers; the extra amount for the Corps would be
offset by a reduction to FEMA DRF by the same amount. On May 18, 2006, the Administration
revised its FY2006 request again, proposing $1.9 billion for border security, primarily funded through
Defense and Homeland Security, with an offset from its request for Defense, primarily procurement,
of an equal amount.
a. A maximum of $150 million of the amount provided to DRF in the House bill is authorized to be
transferred to the FEMA DADL program. In addition, $712 million of the amount provided to
the Small Business Administration (SBA) in the House bill is required to be transferred to DRF.
96 For information on regular FY2006 funding for DHS, see CRS Report RL32863,
Homeland Security Department: FY2006 Appropriations, by Jennifer E. Lake and Blas
Nunez-Neto.

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Federal Emergency Management Agency.97 The DHS exercises broad
authority to address catastrophes resulting from terrorist attacks as well as natural
disasters. Within DHS, FEMA is specifically charged to prepare for, respond to,
recover from, and lessen the effects of, emergencies, regardless of cause. Through
appropriations made to the Disaster Relief Fund (DRF), assistance authorized by the
Robert T. Stafford Disaster Relief and Emergency Assistance Act — popularly
known as the Stafford Act — is provided to individual victims, state and local
governments, and certain nonprofit organizations.
The President requested a supplemental appropriation of $9.9 billion for all
DHS activities; of this amount, $9.8 billion is proposed to be appropriated for
FEMA. The FEMA total in the request includes $9.4 billion for the DRF, $70
million for administrative and regional operations, $5 million for preparedness,
mitigation, response, and recovery for personnel costs associated with hurricane
recovery, and $301 million for loans and related administrative expenses to
communities to replace lost tax revenue through the Disaster Assistance Direct Loan
Assistance (DADLA) account.
Funds appropriated to the DRF are used to provide assistance to individuals,
families, state and local governments, and certain nonprofit organizations. DRF
funds are used for all major disasters and emergencies that are the subject of
presidential Stafford Act declarations; in recent years the number of declarations
issued each year falls in the range of 40 to 70 incidents. As a general rule, the
President requests, and Congress appropriates, DRF funding to meet annual historical
averages (currently approximately $2 billion) for outlays. For example, the President
requested almost $2 billion for the DRF in the FY2007 budget submission.
Annual appropriations are not always sufficient, however, when catastrophes
such as the terrorist attacks of September 11, 2001, or Hurricane Katrina and the
other 2005 Gulf Coast hurricanes, occur. Many precedents exist for the enactment
of supplemental appropriations after catastrophes occur. For example, for FY2005,
Congress appropriated $2 billion to the DRF during the annual appropriation process
and later provided an additional $6.5 billion in supplemental disaster relief funding
(P.L. 108-324) after Hurricanes Charley, Frances, Ivan, and Jeanne struck in the
summer of 2004. Due to the wide range of assistance authorized by the Stafford Act
— from life saving response to long-term recovery and rebuilding — Congress
generally appropriates a large share of the funds in emergency supplemental
legislation to the DRF. Expenditures by FEMA for Stafford Act assistance occur on
an “as-needed-and-approved” basis from the DRF and are available on a “no-year”
basis, which means that they remain available until used.
Congressional Action. The House-approved amount, $9.8 billion, is slightly
more than the total initially requested for FEMA, prior to the modified request of
April 25, 2006, that reduced the initial supplemental request by $2.2 billion for an
offset for a requested increase of $2.2 billion for the Army Corps of Engineers. The
House bill includes $9.5 billion for the DRF (reduced by $2 million); $70 million for
administrative and regional operations; $10 million for preparedness, mitigation,
97 Prepared by Keith Bea, Specialist in American National Government.

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response, and recovery; and $151 million for DADLA and administrative expenses,
in addition to a maximum of $150 million authorized to be transferred from the DRF
to DADLA. The House measure includes discretionary transfer authority of up to
$150 million to the Disaster Assistance Direct Loan Program Account. Combined
with the direct appropriation of $151 million for the Disaster Assistance Direct Loan
Program, the $301 million total in the House bill matches the Administration’s
request.
The Senate bill provides the amount initially requested by the President plus an
additional $1.2 billion for the development of alternative housing for disaster victims.
In its April 25, 2006 statement of administration policy, the Administration
specifically objected to the additional funds for the DRF that are provided in the bill
as reported by the Senate Committee on Appropriations. The Senate amount reflects
an amendment by Senator Vitter which reduces the FEMA total by $200 million to
offset an increase to the Army Corps of Engineers for flood control.
Other DHS Activities. The request includes $69.5 million for the United
States Coast Guard (USCG), $16 million for Customs and Border Protection (CBP),
and $13.5 million for the Office of the Inspector General (OIG). The USCG would
be provided $62.2 million for major repair and reconstruction of facilities damaged
by the 2005 Gulf Coast hurricanes, and $7.3 million for related cleanup and repair
needs. The CBP funds would be used to rebuild hurricane-damaged CBP facilities
and structures in New Orleans. The OIG funds would be transferred from DHS to
other federal OIG offices to support, investigate, and audit other federal recovery
activities related to the 2005 Gulf Coast hurricanes.
Congressional Action. The House bill increases funding for the USCG to
$95.1 million, compared to the $69.5 requested, and the Senate bill would increase
such funds to $282.4 million. For the CBP, the House bill provides a small increase,
to $17.7 million, and the Senate bill does the same. For the OIG, the House bill
provides the requested amount of $13.5 million; the Senate bill provides no
additional funds to the OIG.
Department of the Interior
The President’s FY2006 supplemental request for the Department of the Interior
(DOI) is $216 million, as shown in Table 23.98
98 For regular FY2006 funding for DOI, see CRS Report RL32893, Interior, Environment,
and Related Agencies: FY2006 Appropriations
, by Carol Hardy Vincent and Susan Boren.

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Table 23. FY2006 Hurricane Supplemental for Interior
($s — millions)
Supp.
Supp.
Supp.
Supp.
Interior Agency
Request
House
Senate
Conference
Fish and Wildlife Service
$132.4
$132.4
$132.4

National Park Service (NPS),
$3.0
$3.0
$83.0

Historic Preservation Fund
NPS, Construction
$55.4
$55.4
$55.4
United States Geological Survey
$10.2
$10.2
$10.2

Minerals Management Service
$15.0
$15.0
$15.0

Interior Total
$216.0
$216.0
$296.0

Source: CRS calculations based on S.Rept. 109-230.
Fish and Wildlife Service.99 The Fish and Wildlife Service (FWS) would
receive $132.4 million under the request out of a total of $216 million for Interior.
Funds would be available for cleanup and repair of 61 national wildlife refuges in the
Southeast that were damaged by the 2005 Gulf Coast hurricanes. According to a
December 2, 2005 memorandum from FWS, the 2005 Gulf Coast hurricanes caused
$147.9 million in damages and recovery costs to National Wildlife Refuges, National
Fish Hatcheries, and agency offices in two agency regions. Of the total, $12.5
million was due to the costs of initial response and recovery. Of the remaining
$135.4 million, $61 million was for priority damages. The FY2007 FWS Budget
Justification (p. 154) would cut total Refuge Operations and Maintenance by $5.7
million, a figure that does not include the FY2006 supplemental construction funding
for refuges. The FY2007 Construction request (p. 389-432) for FWS proposes a
decrease in funding from $45.9 million to $19.7 million. Moreover, the regular
Construction request includes no proposals for the Gulf Coast states most heavily
affected by the three hurricanes, though funds are specified for projects in other
regions or states. The data suggest that the February 16, 2006 emergency
supplemental request may be viewed as a partial replacement for funds that would
normally be requested in the regular budget process.
National Park Service, Historic Preservation Fund.100 The President
requested, and the House bill would provide, an FY2006 supplemental of $3.0
million for the Historic Preservation Fund (HPF) of the National Park Service (NPS).
The Senate bill would provide $83.0 million for the HPF, which is an amount that
exceeds the current total FY2006 appropriation for all of HPF’s programs ($72.2
million). The HPF provides grants-in-aid to State Historic Preservation Offices
(SHPOs) for the protection of cultural resources and for activities specified in the
National Historic Preservation Act. According to the National Trust for Historic
99 Prepared by M. Lynne Corn, Specialist in Natural Resources.
100 Prepared by Susan Boren, Specialist in Social Legislation.

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Preservation, thousands of historic homes have been lost and tens of thousands of
historic properties have been damaged by Hurricanes Katrina and Rita. The purpose
of the Senate bill’s additional funding is to establish a specialized grants-in-aid
program ($80.0 million) for the repair and rehabilitation of historic structures
(particularly those on the National Register of Historic Places) that were damaged by
Hurricanes Katrina and Rita, and to provide assistance ($3.0 million) to the SHPOs
in states that sustained the most hurricane damage. The Administration’s FY2007
budget request for all HPF activities is $71.9 million, less than the amount that would
be provided in the Senate-reported bill.101
Other Interior Activities. The request includes $55.4 million for NPS
construction activities, $15 million for the Minerals Management Service (MMS),
and $10.2 million for the United States Geological Survey (USGS). The NPS would
receive $55.4 million for cleanup and repair of 12 national parks damaged by the
2005 Gulf Coast hurricanes in addition to the HPF activities described above. The
MMS funds would be used for relocation expenses related to the temporary move of
the MMS regional office from Louisiana to Texas. The USGS funds would be for
additional facility and equipment repair at USGS sites located in the Southeast that
were damaged by the 2005 Gulf Coast hurricanes.
Congressional Action. Both the House and Senate bills fully fund the
President’s request for Interior. In addition, the Senate bill adds an additional $80
million to establish a specialized HPF grants-in-aid program for the repair and
rehabilitation of historic structures that were damaged by Hurricanes Katrina and
Rita.
Department of Education102
The President’s FY2006 supplemental request includes no additional funds for
the Department of Education (ED), and no funds would be provided by the bill as
passed by the House. However, the Senate bill includes $881.5 million for education
activities, as shown in Table 24, and Section 2702 of the bill modifies the provisions
for the Historically Black Colleges and Universities Capital Financing Program,
providing an estimated $15.0 million of additional funding, for an overall ED total
of $896.5 million.
101 For additional information, please see CRS Report 96-123, Historic Preservation:
Background and Funding
, by Susan Boren.
102 Prepared by Rebecca R. Skinner, Specialist in Social Legislation.

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Table 24. FY2006 Hurricane Supplemental for Education
($s — millions)
Supp.
Supp.
Supp.
Supp.
Education Activity
Request
House
Senate
Conference
Office of the Inspector General
$0.0
$0.0
$1.5

Hurricane Education Recovery
$0.0
$0.0
$880.0

Education Total a
$0.0
$0.0
$881.5

Source: CRS calculations based on S.Rept. 109-230.
a. Section 2702 of the Senate bill provides an estimated additional $15.0 million for the Historically
Black Colleges and Universities Capital Financing Program.
While the Administration did not include funding for education in its emergency
supplemental appropriations request and the House bill does not include funding for
education, the Senate version of the FY2006 supplemental provides $896.5 million
for hurricane disaster education relief. The majority of this funding would be
directed toward hurricane education recovery. More specifically, $200 million would
be used to create a new Education Relief Loan Program that would provide long-
term, low-interest direct loans to postsecondary education institutions for direct or
indirect loses suffered as a result of having to suspend their operations and being
unable to reopen in existing facilities due to the impact of Hurricanes Katrina or Rita.
An additional $650 million is provided for the Temporary Emergency Impact Aid for
Displaced Students program authorized by P.L. 109-148. Funds provided through
this program reimburse schools for the costs of educating students displaced by the
2005 Gulf Coast hurricanes. Of the funds provided for the displaced students, $350
million is designated for Innovative Education State Grants (Title V-A of the
Elementary and Secondary Education Act) for 2006-2007 school year expenses
related to the consequences of Hurricanes Katrina and Rita. These funds will be
available to ED until December 31, 2006. The Senate bill includes $30 million under
the Fund for the Improvement of Postsecondary Education (FIPSE) specifically to
provide grants to institutions of higher education adversely affected by the 2005 Gulf
Coast hurricanes. An additional $1.5 million is provided to the Office of the
Inspector General to conduct audit and investigative activities related to the
disbursement of resources related to hurricane education relief. The bill modifies
provisions of the Historically Black College and University Capital Financing
Program for institutions located in an areas affected by a Gulf Coast hurricane
disaster. While the proposed statutory language does not specify appropriations to
support these modifications, a table in the Senate report (S.Rept. 109-230, p. 139)
indicates that $15 million would be provided for this purpose. Finally, the bill
provides the Mississippi Institutes of Higher Learning with the authority to determine
which institutions of higher education would receive additional flexibility in the use

CRS-79
of funds provided under P.L. 109-148 for hurricane education relief activities.103 In
its April 25, 2006 statement of administration policy, the Administration did not
specifically object to the additional educational funds that would be provided in the
bill as reported by the Senate Committee on Appropriations.
Department of Veterans Affairs
The President’s FY2006 supplemental request for the Department of Veterans
Affairs (VA) is $600 million, as shown in Table 25.104
Table 25. FY2006 Hurricane Supplemental for Veterans Affairs
($s — in millions)
Supp.
Supp.
Supp.
Supp.
VA Project
Request
House
Senate
Conference
Medical Center, New Orleans a
$600.0
$550.0
$561.0

Land Disposal, Gulfport
$0.0
$0.0
$62.0
VA Total
$600.0
$550.0
$623.0
Source: CRS calculations based on S.Rept. 109-230.
a. A maximum of $275 million of the amount provided in the House bill for the VA Medical Center
is authorized to be transferred to the VA Medical Services account.
Medical Center, New Orleans. The Administration requests $600 million
for VA’s Construction, Major Projects account to be used for rebuilding the VA
Medical Center in New Orleans. Proposed funding for this project was previously
included in the October 28, 2005 request, but Congress provided only $75 million for
advance planning and design in P.L. 109-148. The conference committee did not
include the full amount of funding because it felt that there was insufficient
information to determine the actual cost of the project. In the FY2006 conference
report, H.Rept. 109-359, VA was directed to report to the Committees on
Appropriations of both Houses of Congress by February 28, 2006, on the long term
plans for the replacement hospital construction. The report submitted by VA
estimated that the cost of construction of a new VA Medical Center in New Orleans
would be $636 million.
103 For additional information about hurricane education relief provided by the federal
government, please see CRS Report RL33236, Education-Related Hurricane Relief:
Legislative Action
, by Rebecca R. Skinner et al., and CRS Report RL33089, Education and
Training Issues Related to Major Disasters
, coordinated by Charmaine Mercer.
104 For information on regular and supplemental FY2006 funding for VA medical activities,
see CRS Report RL32975, Veterans’ Medical Care: FY2006 Appropriations, by Sidath
Viranga Panangala.

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The FY2006 supplemental request includes a general provision to enable the
VA to use $122 million of the $225 million included for the Medical Services
account in P.L. 109-148 for activation of the new hospital in New Orleans. The VA
would be allowed to transfer this money among the appropriate accounts for the
purpose of funding these activation costs.
Congressional Action. The House bill recommends $550 million for
rebuilding the VA Medical Center in New Orleans, $50 million less than the
Administration’s request. In addition, the Secretary of Veterans Affairs is authorized
to transfer up to $275 million of this amount to the “Medical Services” account, to
be used only for unanticipated costs related to the global war on terror. Availability
of the $550 million appropriation is made contingent on the enactment of authority
for it by June 30, 2006.
The Senate supplemental bill provides $623 million for the Construction, Major
Projects account, $73 million above the House amount. Of this amount, $561 million
is provided for the construction of a new VA Medical Center in New Orleans.
Together with the previous appropriation of $75 million in P.L.109-148, the total
amount of funding for reestablishing the VA Medical Center in New Orleans would
be $636 million. The Senate bill designates $62 million of the total amount
recommended for the Construction, Major Projects, account to be used for the
disposal and cleanup of land associated with the VA medical facility in Gulfport,
Mississippi.
The Senate bill does not include a general provision proposed in the President’s
supplemental request to transfer $122 million from the Medical Services account to
other accounts within VA. However, the bill includes language allowing VA to use
$198.6 million that was previously appropriated under P.L. 109-148, and provides
transfer authority of these funds between Medical Services, Medical Facilities,
Departmental Administration, Construction Minor Projects, and Information
Technology Systems accounts. Furthermore, the Senate bill directs the VA to
transfer land associated with the VA medical facility in Gulfport, Mississippi, to the
City of Gulfport, and to purchase land to construct a new medical facility in Biloxi,
Mississippi.105
During floor consideration of the supplemental bill, the Senate adopted an
amendment offered by Senator Akaka to provide $430 million for the VHA medical
services account for FY2006 (not reflected in Table 25). These funds would not
necessarily be related to the 2005 Gulf Coast hurricanes. Of this additional amount:
$168 million was designated to address veterans’ mental health care needs, including
Post-Traumatic Stress Disorder (PTSD); and $80.0 million was designated for the
provision of readjustment counseling services to veterans. The Senate-adopted
105 Under the Capital Asset Realignment for Enhanced Services (CARES) program, VA had
planned on closing the VA Medical Center in Gulfport, Mississippi, and transferring the
patient workload to the VA Medical Center in Biloxi, Mississippi. To accommodate the
increased workload, VA had planned on constructing a new facility in Biloxi. Hurricane
Katrina completely destroyed the VA Medical Center in Gulfport. As a result, VA does not
plan on reconstructing this facility, and will transfer the land back to the City of Gulfport.
VA is now planning on accelerating the construction of the new medical facility in Biloxi.

CRS-81
amendment included language that requires the President to declare the entire amount
of $430 million as an emergency requirement.
Department of Transportation106
The President’s FY2006 supplemental request includes no additional funds for
the Department of Transportation (DOT), and no funds would be provided by the
House bill. However, the Senate supplemental bill includes $1.5 billion for various
transportation activities, as shown in Table 26.
Table 26. FY2006 Hurricane Supplemental for Transportation
($s — millions)
Supp.
Supp.
Supp.
Supp.
Transportation Activity
Request
House
Senate
Conference
Emergency Highway Assistance
$0.0
$0.0
$594.0

Emergency Assistance for Public
$0.0
$0.0
$200.0
Transportation
Capital Grants for Rail Line
$0.0
$0.0
$700.0

Relocation Projects
Transportation Total
$0.0
$0.0
$1,494.0

Source: CRS calculations based on S.Rept. 109-230.
The Senate bill includes $700 million to relocate a CSX freight rail line further
inland from the Gulf Coast. The President did not request this funding nor was it
included in the House bill. The rail line currently runs along the coast from
Pascagoula, MS through Gulfport, MS to New Orleans. The track was heavily
damaged from the Hurricane and CSX spent approximately $250 million of insurance
funds to repair the line. The line reopened to traffic in early February 2006.
Supporters of this measure contend that the purpose of relocating the rail line further
inland is to make it less susceptible to storm damage in the future. Coastal
communities have wanted to move the rail track even before the 2005 Gulf Coast
hurricanes because of safety concerns at rail crossings and trains blocking street
traffic. Critics of the funding measure contend that the existing rail line has just been
repaired, is in good working order, and that relocating the line primarily benefits land
developers along the coast. They note that freight railroads are private sector
corporations that primarily finance their own rights-of-way and argue that the federal
government should not be paying the bill for this project.
The Senate bill includes highway and transit funding that was not included in
the President’s request nor in the House version. The Senate bill includes $594
million for the Emergency Relief (ER) Program of the Federal Highway
106 Prepared by John Frittelli, Specialist in Transportation.

CRS-82
Administration. These funds are to carry out ER projects that are included in the ER
backlog table or are currently being considered for inclusion in the backlog table.
The ER backlog table includes previous disaster reconstruction projects across the
United States.107 Within the context of Hurricanes Katrina, Rita, and Wilma,
Congress has previously appropriated $2.75 billion in ER funds for the repair of
highways damaged by these storms.108 The Senate bill includes $200 million in
federal grants for the repair of public transit systems damaged by Hurricane Katrina.
In its April 25, 2006 statement of administration policy, the Administration
specifically objected to the additional transportation funds that are provided in the
bill as reported by the Senate Committee on Appropriations.
Department of Housing and Urban Development
The President’s FY2006 supplemental request for the Department of Housing
and Urban Development (HUD) is $4.4 billion, as shown in Table 27.109
Table 27. FY2006 Hurricane Supplemental for HUD
($s — millions)
Supp.
Supp.
Supp.
Supp.
HUD Program
Request
House
Senate
Conference
Tenant-Based Rental Assistance
$202.0
$0.0
$202.2

Community Development Block Grant
$4,200.0
$4,200.0
$5,200.0

HUD Total
$4,402.0
$4,200.0
$5,402.2

Source: CRS calculations based on S.Rept. 109-230.
Community Development Block Grants.110 Congress included $11.5
billion of FY2006 supplemental appropriations for disaster-recovery assistance under
the Community Development Block Grant (CDBG) in P.L. 109-148, to assist the five
states (Louisiana, Mississippi, Alabama, Texas, and Florida) impacted by the 2005
Gulf Coast hurricanes. Of this amount, $6.2 billion was allocated to Louisiana.
Among other provisions, (1) affected states were authorized to use up to 5% of their
allocation for administrative costs; (2) HUD was authorized to grant waivers of
program requirements (except those relating to fair housing, nondiscrimination, labor
107 It is not unusual for ER backlog projects to be funded under an emergency requirement
designation.
108 For further information on highway assistance as it relates to recent hurricanes, see CRS
Report RS22268, Repairing and Reconstructing Disaster-Damaged Roads and Bridges:
The Role of Federal-Aid Highway Assistance
, by Robert S. Kirk.
109 For information on regular FY2006 funding for HUD, please see CRS Report RL32869,
The Department of Housing and Urban Development (HUD): FY2006 Budget, by Maggie
McCarty, et al.
110 Prepared by Eugene Boyd, Analyst in American National Government.

CRS-83
standards, and the environment); and (3) Mississippi and Louisiana were authorized
to use up to $20 million for Local Initiative Support Corporation and Enterprise
Foundation-supported local community development corporations. The HUD
income targeting requirement for activities benefitting low- and moderate-income
persons was decreased from 70% to 50% of the state’s allocation.
The President’s FY2006 supplemental request includes $4.2 billion for
additional CDBG disaster relief for the state of Louisiana. These funds would be
used for expenses related to the consequences of the 2005 Gulf Coast hurricanes,
except that none of the funds could be used for activities reimbursable by FEMA,
SBA, or the Army Corps of Engineers. Funds would be targeted to flood mitigation
activities which could include infrastructure improvements, real property acquisition
or relocation, and other activities designed to reduce the risk of future damage. As
a condition of receipt of the funds, the state would be subject to an administrative
expense ceiling of 5%, and the state would be allowed to seek waivers of program
requirements except those related to fair housing, nondiscrimination, labor standards,
and environmental review.
During a March 8 Senate Appropriations Committee hearing on the President’s
supplemental appropriations request Senator Hutchison of Texas voiced concern
about the absence of additional assistance for Texas. The Senator noted that the
Administration’s proposal to provide $4.2 billion in emergency supplemental
assistance exclusively for use by Louisiana was unfair to Texas, which used its
regular CDBG appropriations to assist Katrina victims evacuating from Louisiana.
In addition to the cost of addressing the immediate needs of evacuees, the state has
also incurred additional educational and public safety expenses associated with the
significant increase in population. In his testimony before the Committee, Texas
Governor Rick Perry requested an additional $2 billion in CDBG be awarded to the
state.
Congressional Action. The House supplemental bill provides $4.2 billion
for CDBG disaster recovery activities, the same amount as requested by the
Administration; the Senate bill provides $5.2 billion in CDBG assistance. The
Senate bill would expand on language included in the House bill prohibiting the use
of CDBG funds for activities reimbursable by FEMA or the Army Corps of
Engineers to include activities of the Small Business Administration. Both the House
and Senate bills make funds available to the five states affected by the 2005 Gulf
Coast hurricanes; the Administration had sought to provide the assistance exclusively
to Louisiana. During floor consideration of the bill, the Senate approved an
amendment by Senator Cornyn of Texas that requires each of the five states to
receive a minimum allocation of 3.5% of the amount appropriated for CDBG disaster
relief assistance. Both the House and Senate bills target assistance to both
infrastructure reconstruction and activities that would spur the redevelopment of
affordable rental housing, including federally assisted housing and public housing.
Both the House and Senate versions of the bill include a number of provisos
affecting the use and administration of these funds. Each bill would:

CRS-84
! require that at least $1 billion of the CDBG amount be used for
repair and reconstruction of affordable rental housing in the
impacted areas;
! allow each state to use no more than 5% of its supplemental CDBG
allocation for administrative expenses;
! allow the affected states to seek waivers of program requirements,
except those related to fair housing, nondiscrimination, labor
standards, and environmental review;
! allow Governors of the affected states to designate one or more
entities to administer the program;
! decrease the low- and moderate-income targeting requirement from
70% to 50% of the funds awarded;
! require each state to develop a plan for the proposed use of funds to
be reviewed and approved by HUD;
! direct HUD to ensure that each state’s proposed plan gives priority
to activities that support infrastructure development and affordable
rental housing activities;
! require each state to file quarterly reports with House and Senate
Appropriations Committees detailing the use of funds;
! require HUD to file quarterly reports with the House and Senate
Appropriations Committees identifying actions by the Department
to prevent fraud and abuse, including the duplication of benefits; and
! prohibit the use of CDBG funds to meet matching fund requirements
of other federal programs.
In its April 25, 2006 statement of administration policy, the Administration
specifically objected to the additional CDBG funds that are provided in the bill as
reported by the Senate Committee on Appropriations.
Tenant-Based Rental Assistance.111 In October 2005, FEMA engaged
HUD to provide rental assistance to families that were unlikely to qualify for
standard FEMA assistance — specifically, families that were receiving HUD rental
assistance or were homeless when the storms struck. In December 2005, P.L.109-
148 transferred $390 million to HUD from FEMA to provide this rental assistance
directly. HUD has responded to its mission assignment by implementing the Disaster
Voucher Program (DVP). The DVP is largely governed by Section 8 voucher
program rules,112 although the Secretary of Housing and Urban Development was
given the authority to waive income eligibility and rent determination rules.
The President’s FY2006 supplemental request includes $202 million to HUD
for tenant-based rental assistance. It is meant to pay for the last five months of the
18-month period in which the estimated 44,000 eligible families are qualified to
receive DVP assistance. The request also includes proposed programmatic changes
that were not included in the earlier supplemental. These changes would expand
eligibility to several categories of HUD-assisted families that were eligible for
111 Prepared by Maggie McCarty, Analyst in Social Legislation.
112 Section 8 of the U.S. Housing Act of 1937, as amended, provides tenant-based vouchers
for low-income people.

CRS-85
assistance under HUD’s mission assignment from FEMA, but are not currently
eligible for DVP. Language in the supplemental request would also waive a portion
of current Section 8 voucher law that requires lease terms to last no less than one
year. Finally, it would permit owners of project-based rental assistance units in
certain parishes in Louisiana — after first offering a right of first return to displaced
families — to offer vacant units to city or parish employees for up to one year.
Congressional Action. The House bill does not include additional funding
for HUD’s tenant-based rental assistance account. The bill includes the language
requested by the President to expand eligibility for DVP assistance to certain
categories of families and to permit the Secretary to waive the length of leases. The
House bill rejects the President’s proposed language that would have permitted
property owners to make vacant HUD-assisted units available to city or parish
employees.
The Senate bill includes $202 million for the tenant-based rental assistance
account, as the President requested. Like the House bill, the Senate bill includes the
President’s requested expansion of eligibility and waiver authority. Unlike the
House, the Senate bill also includes authority to make vacant properties available to
city and parish employees for up to one year, as requested by the President. The
Senate bill includes two set-asides not requested by the President. The first is for up
to $5 million for HUD data systems. The second is for no less than $100 million for
project-based rental assistance.113 The funds would be available for buildings that
were receiving HUD-assistance before they were damaged by the storm, as well as
new structures built using Low-Income Housing Tax Credits. The Senate Committee
report notes that the funds “will help expedite the preservation of the stock of low-
income housing in the gulf.”
Other Departments and Agencies
The President’s FY2006 supplemental request for other departments and
agencies is $59.7 million, as shown in Table 28.
113 Unlike vouchers — which are provided to families to use in the housing of their choice
— project-based rental assistance is provided to specific units of housing for low-income
families.

CRS-86
Table 28. FY2006 Hurricane Supplemental: Other Departments
and Agencies
($s — millions)
Supp.
Supp.
Supp.
Supp.
Department or Agency
Request
House
Senate
Conference
Justice
$9.7
$7.0
$20.2

National Aeronautics & Space
$0.0
$30.0
$35.0

Administration
Environmental Protection Agency
$13.0
$13.0
$13.0

Labor
$0.0
$0.0
$34.5

Health and Human Services
$0.0
$0.0
$28.7

Corporation for National and
$0.0
$0.0
$20.0

Community Service
Social Security Administration
$0.0
$0.0
$0.3
Historically Black Colleges and
$0.0
$0.0
$15.0
Universities Capital Financing
Armed Forces Retirement Home a
$0.0
$0.0
$176.0

General Services Administration
$37.0
$37.0
$37.0

Election Assistance Commission
$0.0
$0.0
$30.0
Other Department/Agency Total
$59.7
$87.0
$379.7

Source: CRS calculations based on S.Rept. 109-230, adjusted for Senate floor amendments.
a. The Administration requested a consolidation of $75.7 million in prior appropriations for the
Armed Forces Retirement Home.
Department of Justice. The request includes $9.7 million in supplemental
funds for the Department of Justice (DOJ) United States Attorneys for salaries and
expenses related to the significantly increased caseload for prosecutions and
investigations of cases stemming from the 2005 Gulf Coast hurricanes.114
Congressional Action. The House bill provides $7 million of the DOJ
request, including $5 million, as proposed, for U.S. Attorneys activities, and $2
million for the Criminal Division and the Civil Division, less than the $3.2 million
request. The bill does not approve a DOJ request to transfer funds from this account
114 For information on regular FY2006 funding for DOJ, see CRS Report RL32885,
Science, State, Justice, Commerce and Related Agencies (House)/Commerce, Justice,
Science and Related Agencies (Senate): FY2006 Appropriations
, by Ian F. Fergusson and
Susan B. Epstein.

CRS-87
to other agency departments engaged in fraud investigations and prosecutions. The
Senate bill recommends increasing the amount to $20.2 million.
National Aeronautics and Space Administration. The Administration
did not request supplemental funds for the National Aeronautics and Space
Administration (NASA). The House bill provides $30.0 million for NASA for the
repair and rehabilitation of facilities and other costs associated with hurricane
damage. The amount provided in the Senate bill is $35.0 million.
Environmental Protection Agency. The request includes $13 million in
supplemental funds for the Environmental Protection Agency (EPA). Of this
amount, $7 million would be allocated for the Leaking Underground Storage Tank
Program for assessments and corrective actions related to leaking storage tanks. The
remaining $6 million would be provided for EPA Environmental Programs and
Management for environmental monitoring, assessment, and analysis necessary to
protect public health during reconstruction and recovery.115
Congressional Action. The House bill fully funds the request the
Administration’s request for the EPA. The Senate bill provides the same amount.
Armed Forces Retirement Home.116 The request would consolidate $76
million of previously appropriated funds to implement the findings of a
congressionally mandated study due in March 2006 to determine the rehousing of
displaced military retirees who lived at the Gulfport Armed Forces Retirement Home,
that was damaged by the Gulf Coast hurricanes.117 Residents of that facility were
relocated to the Armed Forces Retirement Home in Washington, D.C. The
Administration’s proposal would tap $56 million in funds already appropriated in the
Hurricane Katrina reallocation and $20 million in unobligated balances.118
Congressional Action. The House-passed bill rejects the Administration’s
proposal to consolidate funds for rehousing of military retirees displaced from the
Gulfport Armed Forces Retirement Home. The Committee report justifies the
rejection on the basis that the congressionally required plan has not yet been
submitted. The Senate bill provides $176 million in new funds, to be combined with
115 For information on regular FY2006 funding for the EPA, see CRS Report RL32893,
Interior, Environment, and Related Agencies: FY2006 Appropriations, Carol Hardy
Vincent and Susan Boren.
116 Prepared by Amy Belasco, Specialist in National Defense. The Armed Forces Retirement
Home is part of the Department of Defense, Civil budget function.
117 H.Rept. 109-359, p. 513.
118 See entries for “Armed Forces Retirement Home” in OMB, FY2005 Supplemental,
Estimate No. 12, Defense, Homeland Security, and Corps of Engineers (Disaster Relief
associated with Hurricane Katrina
, 9-7-05; [http://www.whitehouse.gov/omb/budget/
amendments/supplemental_9_7_05.pdf]; and in OMB, Estimate No. 2, FY2006 Emergency
Supplemental (various agencies), Ongoing Hurricane Recovery Efforts in the Gulf States
,
2-16-06. [http://www.whitehouse.gov/omb/budget/amendments/supplemental1_
2_16_06.pdf]

CRS-88
$45 million from previously appropriated funds, for the plan, design, and
construction of a new Armed Forces Retirement Home in Gulfport, Mississippi.
General Services Administration. The request includes $37 million in
supplemental funds for the General Services Administration (GSA). Federal
Buildings Fund. These funds would be used to cleanup and repair the multiple
federal buildings that received wind and water damage from the 2005 Gulf Coast
hurricanes. Funds would be used to make both short- and long-run repairs and
alterations.119
Congressional Action. The House bill fully funds the request for the
General Services Administration; the Senate bill does likewise.
Low-Income Home Energy Assistance Program.120 During markup of
the FY2006 supplemental measure, the House Committee adopted an amendment by
Representative David Obey, as modified by Representative Ralph Regula, that would
have made available in FY2006 funds for the Low-Income Home Energy Assistance
Program (LIHEAP) that were appropriated for FY2007 in the Deficit Reduction Act
of 2005 (P.L. 109-171). LIHEAP is a program administered by the Department of
Health and Human Services. The Deficit Reduction Act contained $1 billion for
LIHEAP, $250 million of which was to be distributed as regular funds (distributed
to all states based on a formula), and $750 million as contingency funds (allotted to
one or more states, at the Administration’s discretion, and based on emergency need).
The original Obey amendment would have made the entire $1 billion available for
FY2006, while the Regula modification would have made only the $750 million in
contingency funds available for FY2006. The contingency funds would have
remained available until the end of FY2007 (H.R. 4939, section 3010). The Senate
bill provides no supplemental funds for LIHEAP; the Senate Committee on
Appropriations struck the LIHEAP language due to the previous enactment of a law
with similar provisions, P.L. 109-204, on March 20, 2006.121
Other Departments. Neither the President’s request nor the House bill
included funds for the Departments of Transportation, Labor, Health and Human
Services, or Education, or the Corporation for National and Community Service. The
Senate bill includes nearly $2.5 billion for the following departments and agencies:
! Transportation — $1.5 billion for emergency relief highway
projects, grants for facility repairs, and repair of railroad tracks
(discussed above);
119 For information on regular FY2006 funding for the GSA, see CRS Report RL32905,
Transportation, the Treasury, Housing and Urban Development, the Judiciary, the District
of Columbia, the Executive Office of the President, and Independent Agencies: FY2006
Appropriations
, by David Randall Peterman and John Frittelli.
120 Prepared by Libby Perl, Analyst in Social Legislation.
121 For further information on LIHEAP, please see CRS Report RL31865, The Low-Income
Home Energy Assistance Program (LIHEAP): Program and Funding
, by Libby Perl. P.L.
109-204 provides $500 million of regular LIHEAP funds and $500 million of contingency
funds in FY2006.

CRS-89
! Education — $881.5 million of aid to affected educational
institutions and students (discussed above), as well as $15.0 million
for the Historically Black Colleges and Universities Capital
Financing Fund;
! Labor — $34.5 million for repair to Jobs Corps centers;
! Health and Human Services — $28.7 million for facility repair,
communications network, and pest abatement activities; and
! Corporation for National and Community Service — $20 million for
the National Civilian Conservation Corps to support recovery
activities.
! Election Assistance Commission — $30.0 million for costs related
to the 2005 Gulf Coast hurricanes for administering federal
elections.
Titles Added by the Senate Committee on Appropriations
The Senate bill for FY2006 supplemental appropriations includes four
additional titles to H.R. 4939, as follows. The funds provided under these titles are
included in Table 16 of this report.
! Title III of the bill includes $3.9 billion for emergency agricultural
assistance for farm producers affected by many natural disasters, not
only Hurricane Katrina. These funds are included in Table 17 and
discussed previously as supplemental funding for agriculture;
! Title IV provides $12.5 million for drought assistance to be provided
by the Corps of Engineers and the Bureau of Reclamation at the
Department of the Interior;
! Title V provides $648 million for port security enhancements,
discussed previously in this report; and
! Title VI provides $2.3 billion for pandemic influenza preparedness
activities.
Pandemic Influenza Prevention and Preparedness. As agreed to by
the Senate, Title VI of the FY2006 supplemental appropriations includes $2.6 billion
for pandemic influenza preparedness activities at the Department of Health and
Human Services (HHS). The amount includes not only the initial $2.3 billion
recommended by the Senate Committee on Appropriations in S.Rept. 109-230, but
also $289 million added by an amendment by Senator Edward Kennedy on the Senate
floor to compensate persons harmed by pandemic influenza vaccines. The initial
$2.3 billion includes, among other amounts, $300 million for state and local
governments, $50 million for laboratory capacity and research at the Centers for
Disease Control and Prevention (CDC), and at least $200 million for CDC global and
domestic disease surveillance, research, risk communication, rapid response, and
quarantine. The $2.3 billion amount was first requested by the Administration for
FY2007 as part of a three-year (FY2006 through FY2008) emergency supplemental
request for pandemic flu in November 2005, without a detailed breakdown.
Congress provided funding for only the FY2006 request (in P.L. 109-148), and the
$2.3 billion amount was again requested as an “allowance” in the FY2007 budget
proposal, with HHS noting that a formal request for the funds would be transmitted

CRS-90
to the Congress at a later date.122 In its April 25, 2006 statement of administration
policy, the Administration specifically endorsed additional funds for pandemic
influenza prevention and preparedness without actually agreeing to a specific funding
level.
122 For background information on pandemic flu, please see CRS Report RL33145,
Pandemic Influenza: Domestic Preparedness Efforts, by Sarah A. Lister.

2006
erence
Y
F

Conf
6.67
0.12
0.15
1.07
0.12
0.86
0.01
1.20
0.01
0.00
0.10
0.18
2.83
0.24
0.00
1.59
0.09
2006
10.21
17.59
Y
F

Senate
Supp.
6.51
0.10
0.17
1.06
0.11
0.83
0.01
1.15
0.00
0.00
9.93
0.10
0.18
2.79
0.24
0.00
1.72
0.06
2006
18.38
Y
F

House
Supp.
d
0.33
0.26
0.91
0.12
1.29
0.01
1.65
0.00
0.00
0.15
0.36
4.60
0.24
0.00
3.46
0.08
11.22
15.79
39.40
2006 Total
Y

ith Request
F
w
c
6.51
0.10
0.13
0.76
0.11
0.83
0.01
1.15
0.00
0.00
9.60
0.10
0.18
2.79
0.24
0.00
1.62
0.06
18.05
2006
Y
F

Revised
Supp.
Request
ccount
.L.
4.71
0.23
0.14
0.14
0.01
0.46
0.00
0.51
0.00
0.00
6.20
0.05
0.18
1.81
0.01
0.00
1.83
0.03
21.35
91
A
2006
Y
F

ridge, P
109-148
CRS-
B
($s — billions)
b
0.29
0.20
0.54
0.01
1.36
0.00
2.01
0.00
0.00
0.03
0.33
3.46
0.08
0.07
2.61
0.02
al
14.52
18.93
31.36
2005
Funding by
Tot
Y
F

Enacted
a
0.00
0.00
0.86
0.00
0.92
0.00
3.27
0.00
0.00
0.00
0.00
2.55
0.00
0.00
1.57
0.00
11.97
17.02
29.97
2004
Y
F

Obligations
y
av
— Department of Defense FY2006 War-Related Supplemental Request and Prior
e
ersonnel
ent, N
itle/account
T

y
Reserv
y
y
y

y
ppendix A
A

M, Arm
M, AR
M, ARNG
M, Nav
M, NR
M, MC
M, MCR
Mil Pers, Arm
Mil Pers, ARNG
Mil Pers, AR
Mil Pers, Nav
Mil Pers, Nav
Mil Pers, MC
Mil Pers, MCR
Mil Pers, AF
Mil Pers, ANG
Mil Pers, AFR
Subtotal: Military P
O&
O&
O&
O&
O&
Facilities Sustainm
O&
O&

2006
erence
Y
F

Conf
6.06
0.02
0.03
2.88
0.03
0.00
1.91
3.70
1.96
7.60
0.52
0.00
0.52
1.15
0.00
0.16
1.31
0.53
0.20
1.59
2006
[0.74]
[0.04]
[0.08]
31.60
Y
F

Senate
Supp.
5.33
0.02
0.03
3.25
0.00
0.00
0.00
1.85
3.01
0.00
4.86
0.50
0.00
0.50
1.15
0.01
0.16
1.32
0.53
0.20
1.98
2006
[1.20]
[.045]
32.10
Y
F

House
Supp.
d
8.57
0.02
0.04
4.34
0.00
4.76
2.20
3.70
0.00
3.03
0.00
3.03
1.15
0.00
0.22
1.37
0.58
0.26
1.99
[1.50]
[.045]
61.27
-0.10
10.56
2006 Total
Y

ith Request
F
w
c
6.09
0.02
0.03
3.54
0.00
0.10
0.00
2.20
3.70
0.00
6.00
0.52
0.00
0.52
1.15
0.00
0.19
1.34
0.35
0.20
1.13
[1.50]
[.045]
32.71
2006
Y
F

Revised
Supp.
Request
.L.
2.48
0.01
0.01
0.81
0.00
0.00
0.00
4.66
0.00
0.00
0.00
4.56
2.52
0.00
2.52
0.00
0.00
0.03
0.03
0.23
0.06
0.86
28.57
-0.10
92
2006
Y
F

ridge, P
109-148
CRS-
B
b
6.06
0.02
0.04
3.46
0.00
0.00
3.80
1.29
5.70
0.00
2.02
0.03
2.05
0.89
0.00
0.24
1.13
0.47
0.35
2.87
al
[1.22]
47.54
-0.10
10.69
2005
Tot
Y
F

Enacted
a
6.13
0.00
0.00
4.79
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.97
0.00
0.97
0.89
0.00
0.00
0.89
0.00
0.00
0.05
[1.15]
45.01
2004
Y
F

Obligations
y
e
t
duction
unds
eh., Arm
Coast Guard
rograms
bat V
hreat Re
a
FF)
ense P
alition Suppor
unds
o
ransfer to
y
y
ed Com
itle/account
T

FF to Coast Guard
I
rack
ide: C
Fund (I
Forces Fund
ised Explos. Defeat Fund
spector Gen’l
n
efw
prov
Capital Fund
terdiction
m
ing
n
I
M, AF
M, AFR
M, ANG
M, Defensewide
M, D
M, Defwide: Coop. T
M, Defwide: T
han. Sec. Forces Fund
&
ransfer from
int I
O&
O&
O&
O&
O
O&
O&
Subtotal: O&M
Iraq Freedom
T
Afg
Iraq Security
Jo
Subtotal: Special F
Work
Nat’l Def. Sealift Fd.
Subtotal: Revolving & Mgt F
Defense Health
Office of I
Drug
Subtotal: Other Def
Aircraft Proc, Arm
Missile Proc, Arm
Proc, Wpns, T

2006
erence
Y
F

Conf
0.83
6.29
0.41
0.33
0.06
0.14
2.58
0.03
1.45
0.68
0.00
0.33
0.00
0.06
0.13
0.38
0.15
0.71
0.21
0.00
0.03
0.04
0.28
2006
15.45
Y
F

Senate
Supp.
0.83
7.53
0.29
0.33
0.09
0.11
3.26
0.03
1.49
0.66
0.00
0.33
0.00
0.42
0.12
0.31
0.15
1.00
0.29
0.00
0.04
0.00
0.32
2006
17.68
Y
F

House
Supp.
d
1.10
9.97
0.29
0.36
0.17
0.10
4.29
0.03
1.49
0.46
0.02
0.51
1.00
0.42
0.13
0.08
0.17
0.79
0.34
0.00
0.03
0.04
0.41
22.62
2006 Total
Y

ith Request
F
w
c
0.83
6.79
0.15
0.32
0.06
0.06
2.58
0.03
1.48
0.35
0.00
0.33
0.00
0.40
0.13
0.06
0.15
0.74
0.34
0.00
0.03
0.04
0.41
14.64
2006
Y
F

Revised
Supp.
Request
.L.
0.27
3.17
0.14
0.04
0.12
0.05
1.71
0.00
0.02
0.12
0.02
0.18
1.00
7.99
0.01
0.00
0.01
0.03
0.05
0.00
0.00
0.00
0.00
0.00
93
2006
Y
F

ridge, P
109-148
CRS-
B
b
0.64
8.78
0.27
0.17
0.07
0.08
3.51
0.01
2.69
0.28
0.00
0.69
0.05
0.04
0.20
0.14
0.25
0.63
0.85
0.14
0.14
0.00
1.13
al
20.93
2005
Tot
Y
F

Enacted
a
0.11
3.21
0.22
0.00
0.00
0.07
0.53
0.00
0.31
0.05
0.00
0.25
0.00
4.80
0.00
0.02
0.00
0.03
0.05
0.11
0.00
0.26
0.00
0.37
2004
Y
F

Obligations
ent
e Equipm
amily Hsg
y
y
and Marine Corps
b
itle/account
y
y
y
y
T
Reserv
y

y
y
y
o, Arm
rocurement
o, Nav
o, AF
m
m
m
E, Arm
E, Nav
E, AF
E, Defensewide/b/
&
&
&
&
Proc, Am
Other Proc, Arm
Aircraft Proc, Nav
Proc Am
Wpns Proc, Nav
Other Proc, Nav
Proc, Marine Corps
Proc Am
Other Proc, AF
Aircraft Proc, AF
Missile Proc, AF
Proc, Defwide
Nat’l Guard &
Subtotal: P
RDT
RDT
RDT
RDT
Subtotal: RDT&E
Mil Con, Arm
Mil Con, Nav
Mil Con, AF
Mil Con, Defensewide
Subtotal: Mil.Con/F

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