Order Code RL33998
Financial Services and General Government (FSGG):
FY2008 Appropriations
May 11, 2007
Garrett L. Hatch
Coordinator
Government and Finance Division
The annual consideration of appropriations bills (regular, continuing, and supplemental) by
Congress is part of a complex set of budget processes that also encompasses the
consideration of budget resolutions, revenue and debt-limit legislation, other spending
measures, and reconciliation bills. In addition, the operation of programs and the spending
of appropriated funds are subject to constraints established in authorizing statutes.
Congressional action on the budget for a fiscal year usually begins following the submission
of the President’s budget at the beginning of each annual session of Congress.
Congressional practices governing the consideration of appropriations and other budgetary
matters are rooted in the Constitution, the standing rules of the House and Senate, and
statutes, such as the Congressional Budget and Impoundment Control Act of 1974.
This report is a guide to a new appropriations bill that Congress is considering for the first
time this year. It is designed to supplement the information provided by the House and
Senate Appropriations Subcommittees on Financial Services and General Government. It
summarizes the status of the bill, its scope, major issues, funding levels, and related
congressional activity. The report lists the key CRS staff relevant to the issues covered and
related CRS products. It is updated as events warrant.
NOTE: A Web Version of this document with active links is
available to congressional staff.
Financial Services and General Government (FSGG):
FY2008 Appropriations
Summary
The FY2008 Financial Services and General Government (FSGG)
appropriations bill includes funding for the Department of the Treasury, the
Executive Office of the President (EOP), the judiciary, the District of Columbia, and
20 independent agencies. Among the independent agencies in the bill are the General
Services Administration (GSA), the Office of Personnel Management (OPM), the
Small Business Administration (SBA), and the United States Postal Service (USPS).
The President’s budget request for FY2008 provided $43.8 billion for the
agencies covered by the FSGG appropriations bill, an increase of 6.8% over the level
of funding those same agencies received in FY2007. Of the requested amount, $12.1
billion would go to the Department of the Treasury, $6.5 billion to the judiciary, and
$23.8 billion to independent agencies. In addition, the Executive Office of the
President would receive $737 million and the District of Columbia $598 million.
Key issues before the 110th Congress when considering the Administration’s
FY2008 budget request include the following:
! The President’s proposals to consolidate the EOP budget accounts,
to expand the authority of the EOP to transfer funds among
appropriations accounts, and to centralize funding for administrative
services;
! Spending on courtroom security enhancements, pay raises for
judges, and the creation of additional judgeships to meet the
demands of rising caseloads;
! Proposed budget cuts for the United States Postal Service (USPS),
which would receive $64 million less than what it had requested and
$20 million below the amount enacted for FY2007; and
! Funding for enforcement, taxpayer services, and business systems
modernization at the Internal Revenue Service.
Both the House and Senate FSGG Appropriations Subcommittees have held
hearings on the request. This report will be updated as action on the FSGG
appropriations bill occurs.
Key Policy Staff
Area of Expertise
Name
Div.
Telephone
Title I: Department of the Treasury
Treasury, Internal Revenue Service
Gary Guenther
G&F
7-7742
Title II: Executive Office of the President and Funds Appropriated to the President
Executive Office of the President
Barbara Schwemle
G&F
7-8655
Title III: The Judiciary
Judiciary
Lorraine Tong
G&F
7-5846
Judiciary
Steve Rutkus
G&F
7-7162
Title IV: District of Columbia
District of Columbia
Eugene Boyd
G&F
7-8689
Title V: Other Independent Agencies
Generally
Virginia McMurtry
G&F
7-8678
Consumer Product Safety Commission
Bruce Mulock
G&F
7-7775
Election Assistance Commission
Kevin Coleman
G&F
7-7878
E-Government Fund in GSA
Harold Relyea
G&F
7-8679
Federal Communications Commission
Patty Figliola
RSI
7-2508
Federal Deposit Insurance Corporation: OIG
Pauline Smale
G&F
7-7832
Federal Election Commission
R. Sam Garrett
G&F
7-6443
Federal Labor Relations Authority
Gerald Mayer
DSP
7-7815
Federal Trade Commission
Bruce Mulock
G&F
7-7775
General Services Administration
Stephanie Smith
G&F
7-8674
Merit Systems Protection Board
Barbara Schwemle
G&F
7-8655
National Archives and Record Administration
Harold Relyea
G&F
7-8679
National Credit Union Administration
Pauline Smale
G&F
7-7832
Office of Personnel Management
Barbara Schwemle
G&F
7-8655
Office of Special Counsel
Barbara Schwemle
G&F
7-8655
Securities and Exchange Commission
Mark Jickling
G&F
7-7784
Selective Service Commission
David Burrelli
FDT
7-8033
Small Business Administration
Eric Weiss
G&F
7-6209
U.S. Postal Service
Kevin Kosar
G&F
7-3968
General Provisions, Government-Wide
Government-wide General Provisions
Barbara Schwemle
G&F
7-8655
Area of Expertise
Name
Div.
Telephone
Competitive Sourcing
L. Elaine Halchin
G&F
7-0646
Cuba
Mark Sullivan
FDT
7-7689
DSP = Domestic Social Policy Division
FDT = Foreign Affairs, Defense, and Trade Division
G&F = Government and Finance Division
RSI = Resources, Science, and Industry Division
Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Key Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Title I: Department of the Treasury . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Department of the Treasury Budget and Key Issues . . . . . . . . . . . . . . . . . . . 5
Treasury Offices and Bureaus (Excluding the IRS) . . . . . . . . . . . . . . . . 5
Internal Revenue Service (IRS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Title II: Executive Office of the President and Funds Appropriated
to the President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
The Executive Office of the President Budget and Key Issues . . . . . . . . . . 11
Consolidation Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Transfer Authority Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Enterprise Services Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Title III: The Judiciary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
The Judiciary Budget and Key Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Cost Containment Initiatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Judicial Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Workload . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Judgeships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Judicial Pay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
House and Senate Budget Hearings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
FY2008 Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Supreme Court . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
U.S. Court of Appeals for the Federal Circuit . . . . . . . . . . . . . . . . . . . 18
U.S. Court of International Trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Courts of Appeals, District Courts, and Other Judicial Services . . . . . 19
Salaries and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Court Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Defender Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Fees of Jurors and Commissioners . . . . . . . . . . . . . . . . . . . . . . . 19
Administrative Office of the U.S. Courts (AOUSC) . . . . . . . . . . . . . . 19
Federal Judicial Center . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
United States Sentencing Commission . . . . . . . . . . . . . . . . . . . . . . . . 20
Judiciary Retirement Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
General Provision Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Title IV: District of Columbia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
The District of Columbia Budget and Key Issues . . . . . . . . . . . . . . . . . . . . 21
President’s Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
District Budget . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Resident Tuition Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
School Improvement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Title V: Independent Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Consumer Product Safety Commission (CPSC) . . . . . . . . . . . . . . . . . 24
Election Assistance Commission (EAC) . . . . . . . . . . . . . . . . . . . . . . . 24
Federal Communications Commission (FCC) . . . . . . . . . . . . . . . . . . . 25
Federal Deposit Insurance Corporation (FDIC): OIG . . . . . . . . . . . . . 25
Federal Election Commission (FEC) . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Federal Labor Relations Authority (FLRA) . . . . . . . . . . . . . . . . . . . . . 26
Federal Trade Commission (FTC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
General Services Administration (GSA) . . . . . . . . . . . . . . . . . . . . . . . 27
Federal Buildings Fund (FBF) . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Electronic Government Fund (E-Gov Fund) . . . . . . . . . . . . . . . . 28
Independent Agencies Related to Personnel Management . . . . . . . . . 29
National Archives and Records Administration (NARA) . . . . . . . . . . 30
National Credit Union Administration (NCUA) . . . . . . . . . . . . . . . . . 31
Securities and Exchange Commission (SEC) . . . . . . . . . . . . . . . . . . . 31
Selective Service System (SSS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Small Business Administration (SBA) . . . . . . . . . . . . . . . . . . . . . . . . 32
United States Postal Service (USPS) . . . . . . . . . . . . . . . . . . . . . . . . . . 32
United States Tax Courts (USTC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
General Provisions Government-Wide . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
List of Tables
Table 1. Status of FY2008 Financial Services and
General Government Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Table 2. Financial Services and General Government Appropriations,
by Title, FY2007-FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Table 3. Department of the Treasury Appropriations,
. . . . . . . . . . . . . . . . . . . . . 4
FY2007 to FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Table 4. Executive Office of the President and Funds Appropriated
to the President, FY2007 to FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Table 5. The Judiciary Appropriations, FY2007 to FY2008 . . . . . . . . . . . . . . . . 14
Table 6. District of Columbia Appropriations, FY2007 to FY2008 . . . . . . . . . . 21
Table 7. Independent Agencies Appropriations, FY2007 to FY2008 . . . . . . . . . 23
Table 8. General Services Administration Appropriations,
FY2007 to FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Table 9. Independent Agencies Related to Personnel Management
Appropriations, FY2007 to FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Financial Services and General Government
(FSGG): FY2008 Appropriations
Most Recent Developments
On February 5, 2007, the President transmitted to Congress the FY2008 budget
request. The request included $43.8 billion for the agencies funded through the
Financial Services and General Government (FSGG) appropriations bill. The FSGG
subcommittees in the House and Senate Appropriations Committees have since held
hearings on the President’s proposal. Table 1 notes the status of the FY2008 FSGG
appropriations bill. The table will be updated as congressional action on the bill
occurs.
Table 1. Status of FY2008 Financial Services and General
Government Appropriations
Conference
Subcommittee
Report
Markup
House
House
Senate
Senate
Conf.
Public
Report Passage
Report
Passage Report
Approval
Law
House
Senate
House Senate
Introduction
In early 2007, the House and Senate Committees on Appropriations reorganized
their subcommittee structures. Each chamber created a new Subcommittee on
Financial Services and General Government (FSGG). In the House, the jurisdiction
of the FSGG Subcommittee was formed primarily of agencies that had been under
the jurisdiction of the Subcommittee on Transportation, Treasury, Housing and
Urban Development, the Judiciary, the District of Columbia, and Independent
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Agencies, commonly referred to as “TTHUD.”1 In addition, the House FSGG
Subcommittee was assigned four independent agencies that had been under the
jurisdiction of the Science, State, Justice, Commerce, and Related Agencies
Subcommittee.2
In the Senate, the jurisdiction of the new FSGG Subcommittee was a
combination of agencies from the jurisdiction of three previously existing
subcommittees. The District of Columbia, which had its own subcommittee in the
109th Congress, was placed under the purview of the FSGG Subcommittee, as were
four independent agencies that had been under the jurisdiction of the Commerce,
Justice, Science, and Related Agencies Subcommittee.3 Additionally, most of the
agencies that had been under the jurisdiction of the Subcommittee on Transportation,
Treasury, the Judiciary, Housing and Urban Development, and Related Agencies
were assigned to the FSGG Subcommittee.4 As a result of this reorganization, the
House and Senate FSGG subcommittees have identical jurisdictions.
The FY2008 FSGG appropriations bill provides funding through five titles, each
of which is discussed in a separate section of this report. In addition, there is a
section on what will likely be Title VI of the FSGG bill, General Provisions
Government-Wide. The language for government-wide general provisions was
proposed by the Administration in the appendix to the FY2008 budget request.
The House Appropriations Subcommittee on Financial Services and General
Government is the primary source of the funding figures used throughout the report.
Other sources include the President’s FY2008 budget request and agency budget
materials.
Overview of FY2008 Appropriations
The President has requested $43.8 billion for the agencies covered by the FSGG
appropriations bill, an increase of 6.8% over the amount enacted for those same
agencies for FY2007. The President’s request would increase appropriations for each
1 The agencies previously under the jurisdiction of the TTHUD Subcommittee that did not
become part of the FSGG subcommittee were the Department of Transportation, the
Department of Housing and Urban Development, the Architectural and Transportation
Barriers Compliance Board, the Federal Maritime Commission, the National Transportation
Safety Board, the Neighborhood Reinvestment Corporation, and the United States
Interagency Council on Homelessness.
2 The Federal Communications Commission (FCC), the Federal Trade Commission (FTC),
the Securities and Exchange Commission (SEC), and the Small Business Administration
(SBA).
3 The FCC, FTC, SEC, and SBA.
4 The agencies that did not transfer from TTHUD to FSGG were Transportation, HUD, the
Architectural and Transportation Barriers Compliance Board, the Federal Maritime
Commission, the National Transportation Safety Board, the Neighborhood Reinvestment
Corporation, and the United States Interagency Council on Homelessness.
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of the five titles in the bill, with the largest gains proposed for the judiciary (+8.9%)
and the smallest for the District of Columbia (+1.2%). The President’s budget
proposal would also increase funding for the Department of the Treasury (+4.4%),
the Executive Office of the President (+2.4%), and Independent Agencies (+7.7%).
Table 2 lists the funding requested for FY2008, by title, and the enacted amounts for
FY2007.
Table 2. Financial Services and General Government
Appropriations, by Title, FY2007-FY2008
(in millions of dollars)
FY2007
FY2008
FY2008
FY2008
FY2008
Title
Enacted
Request
House
Senate
Enacted
Title I: Department of the Treasury
$11,624
$12,141
Title II: Executive Office of the
720
737
President
Title III: The Judiciary
5,980
6,512
Title IV: District of Columbia
591
598
Title V: Independent Agencies
22,140
23,838
Total
$41,055
$43,828
Source: Budget authority table provided by House Appropriations Subcommittee on Financial Services
and General Government.
Note: Columns may not total due to rounding.
Key Issues
The wide scope of the FY2008 FSGG appropriations bill — which provides
funding for two of the three branches of the federal government, a city government,
and 20 independent agencies with a range of functions — may encompass a number
of controversial issues. Several key issues, identified below, may be among those
before Congress.
! Department of the Treasury. Whether the proposed budget provides
adequate funding for enforcement, taxpayer services, and business
systems modernization at the Internal Revenue Service.
! Executive Office of the President (EOP). Whether to accept the
President’s proposals to (1) consolidate EOP budget accounts into
a single appropriation, (2) expand the authority of the EOP to
transfer funds among separate appropriations accounts, and (3)
centralize funding for administrative services provided throughout
the EOP in the Office of Administration.
! The Judiciary. What level of funding to provide for judicial security
enhancements and other workforce issues, such as pay raises for
judges, and the hiring of additional staff and creation of additional
judgeships to meet the demands of rising caseloads.
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! Independent Agencies. Whether to enact the President’s proposed
budget for the United States Postal Service (USPS), which is $64
million less than what USPS had requested and $20 million below
the amount enacted for FY2007.
Title I: Department of the Treasury
This section examines FY2008 appropriations for the Treasury Department and
its operating bureaus, including the Internal Revenue Service (IRS). Table 3 shows
the FY2007 enacted amount and the FY2008 request for the Department of the
Treasury.
Table 3. Department of the Treasury Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
FY2007
FY2008
FY2008
Program or Account
House
Senate
Enacted
Request
Enacted
Passed
Passed
Departmental Offices
$216
$250
Department-wide Systems and Capital
30
19
Investments
Office of Inspector General
17
18
Treasury Inspector General for Tax
133
141
Administration
Air Transportation Stabilization
—
-4
Program
Community Development Financial
55
29
Institutions Fund
Treasury Building and Annex Repair
—
—
and Restoration
Financial Crimes Enforcement
73
86
Network
Financial Management Service
235
235
Alcohol and Tobacco Tax and Trade
91
94
Bureau
Bureau of the Public Debt
176
177
Internal Revenue Service, Total
10,597
11,095
Taxpayer Services
2,138
2,103
Enforcement
4,686
4,925
Operations Support
3,545
3,770
Business Systems Modernization
213
282
Health Insurance Tax Credit
15
15
Administration
Total: Department of the Treasury
$11,624
$12,141
Source: Budget authority table provided by House Appropriations Subcommittee on Financial Services
and General Government.
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Note: Columns may not equal total due to rounding.
Department of the Treasury Budget and Key Issues
The Treasury Department performs a variety of governmental functions.
Foremost among them are protecting the nation’s financial system against a host of
illicit activities (e.g., money laundering and terrorist financing), collecting tax
revenue, enforcing tax laws, managing and accounting for federal debt, administering
the federal government’s finances, regulating financial institutions, and producing
and distributing coins and currency.
At its most basic level of organization, Treasury consists of departmental offices
and operating bureaus. In general, the offices are responsible for formulating and
implementing policy initiatives and managing Treasury’s operations, while the
bureaus perform specific duties assigned to Treasury, mainly through statutory
mandates. In the past decade or so, the bureaus have accounted for over 95% of the
agency’s funding and work force.
With one possible exception, the bureaus can be divided into those engaged in
financial management and regulation and those engaged in law enforcement. In
recent decades, the Comptroller of the Currency, U.S. Mint, Bureau of Engraving and
Printing, Financial Management Service (FMS), Bureau of the Public Debt,
Community Development Financial Institutions Fund (CDFI), and Office of Thrift
Supervision have undertaken tasks related to the management of the federal
government’s finances or the supervision and regulation of the U.S. financial system.
By contrast, law enforcement has been the central focus of the tasks handled by the
Bureau of Alcohol, Tobacco, and Firearms; U.S. Secret Service; Federal Law
Enforcement Training Center; U.S. Customs Service; Financial Crimes Enforcement
Network (FinCEN); and the Treasury Forfeiture Fund. Since the advent of the
Department of Homeland Security in 2002, Treasury’s direct involvement in law
enforcement has shrunk considerably. The possible exception to this simplified
dichotomy is the Internal Revenue Service (IRS), whose main duties encompass both
the collection of tax revenue and the enforcement of tax laws and regulations.
Treasury Offices and Bureaus (Excluding the IRS). Funding for many
bureaus comes largely from annual appropriations. Such is the case for the IRS,
FMS, Bureau of Public Debt, FinCEN, Alcohol and Tobacco Tax and Trade Bureau,
Office of the Inspector General (OIG), Treasury Inspector General for Tax
Administration (TIGTA), and the CDFI. But there are some exceptions to this heavy
reliance on appropriated funds. The Treasury Franchise Fund, U.S. Mint, Bureau of
Engraving and Printing, Office of the Comptroller of the Currency, and the Office of
Thrift Supervision finance their operations largely from the fees they charge for
services and products they provide.
In FY2007, Treasury is receiving $11.624 billion in appropriated funds, or 0.4%
more than it received in FY2006, after allowing for a rescission of 1%. Most of these
funds are being used to finance the operations of the IRS, which is receiving $10.597
billion in FY2007. The remaining $1.027 billion is distributed among Treasury’s
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other bureaus and departmental offices in the following amounts: departmental
offices (which include the Office of Terrorism and Financial Intelligence, or TFI, and
the Office of Foreign Assets Control) are receiving $216 million; department-wide
systems and capital investments, $30 million; OIG, $17 million; TIGTA, $133
million; CDFI, $55 million; FinCEN, $73 million; FMS, $235 million; Alcohol and
Tobacco Tax and Trade Bureau (ATB), $91 million; and Bureau of the Public Debt,
$176 million.
For FY2008, the Bush Administration is asking Congress to approve $12.141
billion in funding for Treasury, or 4.4% more than the amount enacted for FY2007.
Once again, most of the requested funding (91%) would go to the IRS, which would
receive $11.095 billion in appropriated funds. The remaining $1.045 billion would
be distributed among Treasury’s other bureaus and departmental offices in the
following amounts: departmental offices would receive $250 million; departmental
systems and capital investments, $19 million; OIG, $18 million; TIGTA, $141
million; a rescission of about $4 million from the Air Transportation Stabilization
program; CDFI, $29 million; no funding for the Treasury building and annex repair
and restoration; FinCEN, $86 million; FMS, $235 million; ATB, $94 million; and
Bureau of the Public Debt, $177 million. Except for department-wide systems and
capital investments and CDFI, all the major accounts would be funded at the same
level as or at higher levels than the amounts enacted for FY2007. (The Air
Transportation Stabilization program represents something of an anomaly in this
regard, because the Administration is asking Congress to rescind about $4 million
that had already been appropriated.)
Under the Administration’s budget proposal, total full-time equivalent
employment at Treasury is projected to rise from 107,734 in FY2006 to 108,965 in
FY2008.5 The projected gain of 1,231 employees would be spread unevenly among
the departmental offices, TIGTA, FinCEN, and the IRS.
Treasury budget documents and recent congressional testimony by Secretary
Henry Paulson indicate that the Treasury Department’s proposed budget for FY2008
is intended to support five strategic objectives: (1) promote economic growth,
security, and opportunity; (2) strengthen national security; (3) manage the federal
government’s finances; (4) strengthen financial institutions; and (5) manage
Treasury’s operations effectively.6 In evaluating the Administration’s budget
proposal, one consideration might be the extent to which the proposed budget would
likely support or promote these objectives, and whether other approaches might be
more desirable.
The Administration maintains that the budget proposal would promote the first
objective, in part, by channeling more resources into Treasury’s contribution to
international economic policy coordination and the Committee on Foreign
5 U.S. Department of the Treasury, FY2008 Budget in Brief (2007), p. 10.
6 See the written testimony of Treasury Secretary Paulson before the House Appropriations
Subcommittee on Financial Services and General Government on Mar. 28, 2007, at
[http://www.ustreas.gov/press/releases].
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Investment in the United States, and by eliminating funding for the Bank Enterprise
Awards program, which is administered through the CDFI.7
The Administration claims the proposal would support the second objective
largely by increasing funding for TFI and FinCEN. TFI collects and analyzes
financial intelligence, formulates and implements measures to combat money
laundering, enforces economic sanctions against foreign entities, and conducts
criminal investigations of alleged financial crimes. The Administration is asking
Congress to boost appropriated funds for TFI from $43 million in FY2007 to $56
million in FY2008. Most of the additional money would be used to expand
Treasury’s capacity to “identify potential national security threats and to enforce U.S.
policies to counter those threats,” improve the “information technology and physical
infrastructure of TFI and its component bureaus and offices,” and deepen the
involvement of TFI in the “broader Intelligence Community.”8 FinCEN is
responsible for protecting the U.S. financial system from a wide range of financial
crimes, including money laundering and terrorist financing. Foremost among its
main tasks is administering the Bank Secrecy Act (BSA). The Administration is
asking Congress to increase funding for FinCEN from $73 million in FY2007 to $86
million in FY2008. A portion of the added funds would be used to upgrade an
electronic filing system for BSA forms and FinCEN’s “critical information
technology system,” and to enhance its project management capabilities.9
In the Administration’s view, the budget proposal would support the third
objective by boosting IRS’s budget for enforcement, taxpayer service, and business
systems modernization, and by implementing several new initiatives intended to
improve taxpayer compliance. (See the next section for more details.)
As the Administration rightly notes in the documents describing its budget
proposal for Treasury, no appropriated funds directly support the fourth objective.
This is because funding for the four Treasury bureaus primarily responsible for
ensuring and sustaining the health and integrity of the U.S. financial institutions —
the Office of the Comptroller, the Office of Thrift Supervision, the U.S. Mint, and
the Bureau of Engraving and Printing — comes mostly from fees they charge for the
services and products they provide.
To support the fifth objective, the Administration is asking Congress to approve
funding for the following projects in the following amounts for FY2008: $6 million
to launch a pilot project known as the Enterprise Content Management system, $2
million to operate and maintain the Treasury Secure Data Network, and $4 million
to improve Treasury’s compliance with the requirements of the Federal Information
Security Management Act and the agency’s “overall security posture.”10
7 Treasury, FY2008 Budget in Brief, p. 3.
8 Ibid., p. 4.
9 Ibid., pp. 38-39.
10 Ibid., p. 6.
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Internal Revenue Service (IRS). To help finance its operations and
multitude of spending programs, the federal government levies individual and
corporate income taxes, social insurance taxes, excise taxes, estate and gift taxes,
customs duties, and miscellaneous taxes and fees. The federal agency responsible
for administering and collecting these taxes and fees (except for customs duties) is
the Internal Revenue Service. In discharging this responsibility, the IRS receives and
processes tax returns, related documents, and tax payments; disburses refunds;
enforces compliance through audits and other procedures; collects delinquent taxes;
and provides a host of services to taxpayers with the aim of enabling them to
understand their rights and responsibilities under the federal tax code and resolving
problems without litigation. In FY2006, the agency collected $2.537 trillion before
refunds, the largest component of which was individual income tax revenue of
$1.236 trillion.
The IRS receives funding for its operations from three sources: appropriated
funds, user fees, and so-called reimbursables, which are payments the IRS receives
from other federal agencies and state governments for services it provides. In
FY2006, appropriated funds accounted for 98% of IRS’s operating budget, with user
fees and reimbursables each adding another 1%.
Appropriated funds are distributed among five accounts:
! (1) taxpayer services, which provides resources for pre-filing
taxpayer assistance, filing and account services, administrative
services for IRS employees, and senior IRS management;
! (2) enforcement, which covers the cost of compliance services,
research and statistical analysis, and administration of the earned
income tax credit;
! (3) operations support, which addresses the improvement and
maintenance of the agency’s information and management systems;
! (4) business systems modernization (or BSM), which provides
funds for developing new information systems for tax administration
and acquiring the hardware and software needed to integrate them
into IRS’s operations; and
! (5) health insurance tax credit administration, which covers the
cost of administering the refundable tax credit for health insurance
established by the Trade Adjustment Assistance Reform Act of
2002.
In FY2007, the IRS is receiving $10.597 billion in appropriated funds, or 0.5%
more than it received in FY2006. Of this amount, $2.138 billion is designated for
taxpayer services, $4.686 billion for enforcement, $3.545 billion for operations
support, $213 million for the BSM program, and $15 million for administration of
the health insurance tax credit. The IRS is one of the many federal agencies being
funded in FY2007 under a year-long continuing resolution (H.J.Res. 20; P.L. 110-5)
enacted in February 2007. Under the resolution, the “requirements, authorities,
CRS-9
conditions, limitations, and other provisions” that governed the use of FY2006
appropriations by all affected agencies are also to govern their use of FY2007
appropriations. As a result, certain restrictions that applied to funding for IRS
operations in FY2006 also apply to the funding for IRS operations in FY2007.
Specifically, the IRS may not reorganize or reduce its workforce in FY2007 without
the consent of the House and Senate Appropriations Committees. In addition, during
FY2007, the IRS is barred from entering the market for tax return preparation
software, and from instituting reductions in taxpayer service until TIGTA completes
a report on the effects of such reductions on taxpayer compliance.
The Bush Administration is asking Congress to appropriate $11.095 billion for
IRS operations in FY2008, or 4.7% more than the amount enacted for FY2007. Of
this amount, $2.103 billion (1.7% less than FY2006) would be used for taxpayer
services, $4.925 billion (5.1% more than FY2007) for enforcement, $3.770 billion
(6.3% more than FY2007) for operations support, $282 million (32.4% more than
FY2007) for the BSM program, and $15 million (the same amount as FY2007) for
administering the health insurance tax credit. Under the budget proposal, total full-
time equivalent employment at the IRS is projected to rise from an estimated 92,404
in FY2007 to 92,814 in FY2008, a gain of 0.4%.11
Budget documents indicate the FY2008 budget proposal for the IRS is intended
to support three strategic goals: (1) bolster taxpayer compliance without imposing
additional reporting burdens on taxpayers, (2) continue the agency’s recent efforts to
“increase and improve the delivery of services offered to taxpayers,” and (3) invest
in information technology designed to “give (IRS) employees the tools they need to
administer and improve both taxpayer service and enforcement programs.”12 Guiding
the pursuit of these goals is a commitment to “provide quality service to taxpayers
while enforcing America’s tax laws in a balanced manner.”
As part of its budget proposal for the IRS, the Administration is also asking
Congress to pass a number of legislative proposals.13 Most are intended to improve
taxpayer compliance through actions such as expanded information reporting,
mandatory electronic filing for “certain large businesses,” and expanded penalties for
fraudulent actions by tax preparers and for erroneous refund claims.
In assessing the Administration’s budget proposal for the IRS, lawmakers may
find it useful to consider the extent to which it would support these objectives and
whether or not the proposed budgets for enforcement, taxpayer service, and BSM are
adequate in light of the many challenges facing the agency. Foremost among those
challenges are improving compliance rates among individuals and businesses without
sacrificing recent gains in taxpayer service, generating more reliable estimates of the
rates of non-compliance among business taxpayers, increasing the share of tax returns
filed electronically, upgrading the agency’s computer systems, managing the agency’s
private tax debt collection program in a way that meets the concerns of critics, and
11 Ibid., p. 10.
12 Ibid., p. 55.
13 Ibid., p. 64.
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hiring and training sufficient numbers of enforcement agents to replace those who
have retired or quit in recent years.
Title II: Executive Office of the President and Funds
Appropriated to the President
All but three offices in the Executive Office of the President (EOP) are funded
in the Financial Services and General Government (FSGG) appropriations bill.14
Table 4 shows the FY2007 enacted appropriations, as well as the FY2008 request for
the EOP.
Table 4. Executive Office of the President and Funds
Appropriated to the President,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
FY2007
FY2008
FY2008
Office
House
Senate
Enacted
Request
Enacted
Passed
Passed
The White House (total)
$173
$187
Compensation of the
0.5
0.5
President
The White House Office
54
53
(salaries and expenses)
Executive Residence, White
12
13
House (operating expenses)
White House Repair and
2
2
Restoration
Council of Economic
4
4
Advisers
Office of Policy Development
3
3
National Security Council
9
9
Office of Administration
89
103
Office of Management and
77
71
Budget
Office of National Drug
27
24
Control Policy
Federal Drug Control Programs
438
449
(total)
High Intensity Drug
225
220
Trafficking Areas Program
Other Federal Drug Control
193
224
Programs
14 Of the three exceptions, the Council on Environmental Quality and the Office of
Environmental Quality are funded in the House and Senate Interior, Environment, and
Related Agencies Appropriations Act. The Office of Science and Technology Policy and
the Office of the United States Trade Representative are funded in the House and Senate
Commerce, Justice, Science, and Related Agencies Appropriations Act.
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Counterdrug Technology
20
5
Assessment Center
Unanticipated Needs
1
1
Office of the Vice President
4
4
(salaries and expenses)
Official Residence of the Vice
0.3
0.3
President (operating expenses)
Total: EOP and Funds
$720
$737
Appropriated to the President
Sources: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government, President’s FY2008 budget request, and U.S. Executive Office of
the President, Fiscal Year 2008 Congressional Budget Submission (Washington: Feb. 2007).
Note: Columns may not equal total due to rounding.
The Executive Office of the President Budget and Key Issues
The FY2008 budget requests an appropriation of more than $737 million for the
EOP and funds appropriated to the President, a 2.4% increase from the almost $720
million appropriated for FY2007. Within the appropriation, funding for “The White
House Office” accounts, discussed under “Consolidation Proposal” below, would
increase 8.3%, but funding for the Office of Management and Budget (OMB) (-7.6%)
and the Office of National Drug Control Policy (ONDCP) (-10.8%) would decrease.
The OMB and ONDCP funding reductions primarily result from the transfer of
monies to the Office of Administration account for the enterprise services initiative
(discussed below).
Unlike the FY2006 and FY2007 budget proposals, when the President requested
that the High Intensity Drug Trafficking Areas Program (HIDTAP, under federal
drug control programs) funding be transferred to the Department of Justice, the
FY2008 budget request continues to include the HIDTAP appropriation under the
EOP, but at a level that is 2.1% less than the program’s FY2007 funding. Significant
changes in funding are also requested for the Other Federal Drug Control Programs
(+16.3%) and the Counterdrug Technology Assessment Center (-75%). Overall,
though, federal drug control program funding would increase 2.7%.
Consolidation Proposal. For the seventh consecutive fiscal year, the
President’s FY2008 budget proposes to consolidate and financially realign several
salaries and expenses accounts that directly support the President into a single annual
appropriation, called “The White House.” The eight accounts included in the
consolidated appropriation would be the following:
! Compensation of the President,
! White House Office (WHO),
! Executive Residence at the White House,
! White House Repair and Restoration,
! Office of Administration,
! Office of Policy Development,
! National Security Council, and
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! Council of Economic Advisers.15
This consolidated appropriation would total more than $187 million in FY2008
for the accounts proposed to be consolidated, an increase of 8.3% from the almost
$173 million appropriated in FY2007. Within “The White House Office” account,
funding for the Compensation of the President would remain unchanged; funding for
the Executive Residence at the White House (+3.4%), the Council of Economic
Advisers (+2.1%), and the Office of Administration (+16.3%) would increase; and
funding for White House salaries and expenses (-0.9%), White House repair and
restoration (-4.9%), the Office of Policy Development (-0.1%), and the National
Security Council (-0.5%) would decrease.
The EOP budget submission states that consolidation “presents the best means
for the President to realign or reallocate the resources and staff available in response
to changing and emerging needs and priorities.”16 The conference committees on the
FY2002 through FY2006 appropriations acts decided to continue with separate
appropriations for the EOP accounts to facilitate congressional oversight of their
funding and operation. This practice continues for FY2007 under P.L. 110-5, the
Revised Continuing Appropriations Resolution.17
Transfer Authority Proposal. As in the FY2007 budget proposal, the
FY2008 budget requests a general provision in Title VI to continue and expand the
authority for the EOP to transfer 10% of the appropriated funds among several
accounts under the EOP. The proposal is included under the government-wide
general provisions at Section 833 and would cover the following accounts in
FY2008:
! The White House,18
! Office of Management and Budget,
! Office of National Drug Control Policy,
! Special Assistance to the President and the Official Residence of the
Vice President (transfers would be subject to the approval of the
Vice President),
! Council on Environmental Quality and Office of Environmental
Quality,
! Office of Science and Technology Policy, and
15 U.S. Executive Office of the President, Office of Management and Budget, Budget of the
United States Government Fiscal Year 2008, Appendix (Washington: GPO, 2007), pp. 963-
964. (Hereafter referred to as FY2008 Budget, Appendix.)
16 U.S. Executive Office of the President, Fiscal Year 2008 Congressional Budget
Submission (Washington: Feb. 2007), p. EOP-14. (Hereafter cited as EOP Budget
Submission.)
17 P.L. 110-5, Feb. 15, 2007,121 Stat. 8.
18 The accounts under the White House are Compensation of the President, White House
Office, Executive Residence at the White House, White House Repair and Restoration,
Office of Administration, Office of Policy Development, National Security Council, and
Council of Economic Advisers.
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! Office of the United States Trade Representative.19
The OMB Director (or such other officer as the President designates in writing)
would be able to, 15 days after notifying the House and Senate Committees on
Appropriations, transfer up to 10% of any such appropriation to any other such
appropriation. The transferred funds would be merged with, and available for, the
same time and purposes as the appropriation receiving the funds. Such transfers
could not increase an appropriation by more than 50%. According to the EOP budget
submission, the transfer authority would “allow the President to address, in a limited
way, emerging priorities and shifting demands” and would “provide the President
with flexibility and improve the efficiency of the EOP.” The authority “is not
intended to be used for new missions or programs, but to address emerging priorities,
shifting demands, and administrative efficiencies within the currently funded
programs.”20
P.L. 108-447, the Consolidated Appropriations Act for FY2005 (Section 533,
Title V, Division H) authorized transfers of up to 10% of FY2005 appropriated funds
among the accounts for the White House Office, OMB, ONDCP, and the Special
Assistance to the President and Official Residence of the Vice President. For
FY2006, P.L. 109-115, the Transportation, Treasury, Housing and Urban
Development, the Judiciary, the District of Columbia, and Independent Agencies
Appropriations Act, 2006 (Section 725) authorized transfers of up to 10% among the
accounts for the White House and the Special Assistance to the President and Official
Residence of the Vice President.
Enterprise Services Proposal. The FY2008 budget request, like that for
FY2007, includes an enterprise services initiative to simplify and make more
efficient the administration of certain common services that are provided throughout
the EOP. Services included in the initiative would be expanded to include burn bag
pickup costs, employee transportation subsidies, and Flexible Spending Account
administrative fees. The budgets for these services in the WHO, Executive
Residence at the White House, Office of Policy Development, National Security
Council, Council of Economic Advisers, OMB, ONDCP, Office of Science and
Technology Policy, United States Trade Representative, and the Council on
Environmental Quality would be moved into the Office of Administration (OA). In
order to “be consistent with other EOP components,” the budgets for health unit
services costs, space-related rent costs, and rent-based Federal Protective Service
costs in OMB and ONDCP also would be included in the OA.21
19 FY2008 Budget, Appendix, p. 964.
20 EOP Budget Submission, p. EOP-15.
21 EOP Budget Submission, pp. EOP-16 - EOP-17.
CRS-14
Title III: The Judiciary
As a co-equal branch of government, the judiciary presents its budget to the
President, who transmits it to Congress unaltered. Table 5 shows the FY2007
enacted amount, and the FY2008 request for the judiciary.
Table 5. The Judiciary Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
FY2007
FY2008
FY2008
Budget Groupings and Accounts
House
Senate
Enacted
Request
Enacted
Passed
Passed
Supreme Court (total)
$74
$79
Salaries and Expenses
63
67
Building and Grounds
11
12
U.S. Court of Appeals for the Federal
25
29
Circuit
U.S. Court of International Trade
16
17
Courts of Appeals, District Courts, and
5,696
6,203
Other Judicial Services (total)
Salaries and Expensesa
4,480
4,858
Court Security
379
422
Defender Services
776
860
Fees of Jurors and
61
62
Commissioners
Administrative Office of the U.S.
72
79
Courts
Federal Judicial Center
23
25
United States Sentencing Commission
15
16
Judicial Retirement Funds
58
65
Total: The Judiciary
$5,980
$6,512
Source: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government.
Note: Columns may not equal total due to rounding. The Administrative Office of the U.S. Courts
has a preliminary revision of the judiciary’s original FY2008 budget request estimate on Mar. 21,
2007, from the total of $6.51 billion to $6.43 billion. A complete revised budget is expected to be
submitted to the subcommittee in May 2007.
a. This account includes about $4 million for the Vaccine Injury Compensation Trust Fund.
CRS-15
The Judiciary Budget and Key Issues
Appropriations for the judiciary — about two-tenths of 1% (0.2%) of the entire
federal budget — are divided into budget groups and accounts. Two accounts that
fund the Supreme Court (the salaries and expenses of the Supreme Court and the
expenditures for the care of its building and grounds) together make up about 1.2%
of the total judiciary budget. The structural and mechanical care of the Supreme
Court building, and care of its grounds, are the responsibility of the Architect of the
Capitol. The rest of the judiciary’s budget provides funding for the “lower” federal
courts and for related judicial services. The largest account, about 75% of the total
budget — the Salaries and Expenses account for the U.S. Courts of Appeals, District
Courts, and Other Judicial Services — covers the salaries of circuit and district
judges (including judges of the territorial courts of the United States), justices and
judges retired from office or from regular active service, judges of the U.S. Court of
Federal Claims, bankruptcy judges, magistrate judges, and all other officers and
employees of the federal judiciary not specifically provided for by other accounts; it
also covers the necessary expenses of the courts. The judiciary budget does not fund
three “special courts” in the U.S. court system: the U.S. Court of Appeals for the
Armed Forces, the U.S. Tax Court, and the U.S. Court of Appeals for Veterans
Claims. Federal courthouse construction also is not funded within the judiciary’s
budget.
The judiciary was one of the few entities in the federal government that was not
subjected to a hard freeze in the enacted year-long budget continuing resolution for
FY2007 (the Revised Continuing Appropriations Resolution, 2007, P.L. 110-5). The
FY2007 appropriations for the judiciary essentially maintained on-board staffing
levels and addressed the immigration-related caseload. In her March 21, 2007,
testimony before the House and Senate Subcommittees on the judiciary’s FY2008
budget request, Judge Julia S. Gibbons, chair of the Budget Committee of the
Judicial Conference of the United States,22 said that the judiciary recognized the
Administration’s and Congress’s concerns about overall federal spending and budget
deficits. She stated that “every item in our budget request relates to performing the
functions entrusted to us under the Constitution. We have no optional programs;
everything ultimately contributes to maintaining court operations and preserving the
judicial system that is such a critical part of our democracy.”23
Cost Containment Initiatives. According to Judge Gibbons, the Judicial
Conference has endeavored, through cost containment policies, to reduce costs and
increase productivity in the federal judiciary for many years. For example, to limit
the growth of the court rental fees paid to the General Services Administration
22 The Judicial Conference of the United States is the principal policymaking body for the
federal courts system. The Chief Justice is the presiding officer of the conference, which
comprises the chief judges of the 13 courts of appeals, a district judge from each of the 12
geographic circuits, and the chief judge of the Court of International Trade.
23 Statement of Honorable Julia S. Gibbons, Chair, Committee on the Budget of the Judicial
Conference of the United States, before the Subcommittee on Financial Services and
General Government of the Committee on Appropriations of the United States Senate, Mar.
21, 2007, p. 2. Hereafter cited as Judge Gibbons’s Mar. 21, 2007, Statement.
CRS-16
(GSA), which currently constitute about 20% of the entire judiciary budget (projected
to exceed one billion dollars in FY2008), the conference approved a cap of 4.9% on
the average rate of growth for courthouse rent to be paid in FY2009 through FY2016.
Through a rent validation project, the judiciary identified GSA rent overcharges
totaling $30 million over three years, and recently found an additional $22.5 million
in overcharges. It is also working with GSA to change the way courthouse rent is
determined and calculated. Restricting the appointment of new magistrate judges and
using information technology (e.g., consolidating computer servers) to increase
efficiency and cost-effectiveness are among other efforts to contain costs.24
Judicial Security. Judicial security — the safe conduct of court proceedings
and the security of judges in courtrooms and off-site — continues to be an issue of
concern. The 2005 Chicago murders of family members of a federal judge; the
Atlanta killings of a state judge, a court reporter, and a sheriff’s deputy at a
courthouse; and the 2006 sniper shooting of a state judge in the judge’s office in
Reno spurred efforts to enhance judicial security. Early in the 110th Congress, the
chairmen of House and Senate judiciary committees introduced companion bills
(H.R. 660 and S. 378, respectively), the Court Security Improvement Act of 2007,
to strengthen security.25 Legislation in the 109th Congress (P.L. 109-13) appropriated
$11.9 million to the U.S. Marshals Service (USMS) to provide intrusion detection
systems in the homes of federal judges who requested them. To date, 90% of the
systems have been installed.26 According to the judiciary, it has been experiencing
problems with perimeter security functions that the Federal Protective Service (FPS)
provides the judiciary at court facilities, and billing issues with FPS. On March 13,
2007, the Judicial Conference endorsed a recommendation to support efforts to
transfer to USMS the security functions that FPS currently provides to court
facilities, as well as the associated funding for these functions.27
Workload. According to Judge Gibbons, the President’s FY2008 budget
request for $13 billion to bolster border security and immigration enforcement will
result in a dramatic increase in the judiciary’s caseload. Immigration-related cases
now make up 25% of the district courts’ criminal caseload. Noting the President’s
funding for 3,000 additional border patrol agents (by the end of 2008, the goal of
achieving the level of 18,000-plus agents will double the number of agents in place
in 2001), Judge Gibbons stated that the judiciary “cannot absorb the additional
workload generated by the homeland security initiatives within current resource
levels.” The workload in the judiciary’s probation and pretrial services programs
also continues to grow — in 2006 there were 112,697 people under supervision, with
24 Ibid., pp. 3-4.
25 For more details about legislative proposals to enhance judicial security, see CRS Report
RL33464, Judicial Security: Responsibilities and Current Issues, by Lorraine H. Tong.
26 U.S. Marshals Service, Office of Congressional Affairs, provided the information to the
author in Feb. 2007.
27 Judge Gibbons’s Mar. 21, 2007, Statement.
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a projected increase to 114,600 in 2007. Bankruptcy filings, however, have declined
sharply from 2006.28
Judgeships. The Judicial Conference voted on March 13, 2007, to ask
Congress to create 67 new federal judgeships — 15 for the courts of appeals (13
permanent, 2 temporary) and 52 for the district courts (38 permanent, 14 temporary)
— to make permanent five temporary judgeships, and to extend another temporary
judgeship for five years. According to the judiciary, since the 1990 omnibus
judgeship bill, the number of courts of appeals judges has remained the same, while
federal appellate court case filings increased by 55% over the same 17-year period.
According to the judiciary, the number of district court judgeships increased by 4%,
while case filings increased by 29%, over the same period of time.29
Judicial Pay. Another key issue being discussed is the judiciary’s advocacy
for a significant increase in judicial pay. John G. Roberts, Jr., Chief Justice of the
United States, stated in his 2006 End-of-the-Year Report on the Federal Judiciary
that judges’ pay has not kept pace with inflation over the years and has led to judges
leaving the bench in increasing numbers. According to the Chief Justice, retaining
and attracting the best talent to the courts is a serious concern. He stated that failure
to raise judicial salaries has reached the level of a “constitutional crisis that threatens
to undermine the strength and independence of the federal Judiciary.”30
House and Senate Budget Hearings
On March 8, 2007, the House Appropriations Subcommittee on Financial
Services and General Government held a hearing on the Supreme Court budget
request for FY2007, and heard testimony from Supreme Court Justices Anthony M.
Kennedy and Clarence Thomas. Issues raised at the hearing included the Supreme
Court building modernization project, workload, technology improvements, judicial
security, minority clerk hiring, and televising Supreme Court proceedings. The
subcommittee held another hearing on March 21, 2007, to hear testimony on the
federal judiciary budget request from Judge Julia S. Gibbons, United States Circuit
Judge for the Sixth Circuit Court of Appeals and chair of the Budget Committee of
the Judicial Conference of the United States, and James C. Duff, director of the
Administrative Office of the U.S. Courts (AOUSC). Among issues raised at the
hearing were judicial security, rent paid to GSA, and workload. The Senate
Appropriations Subcommittee on Financial Services and General Government also
held a hearing on the FY2008 budget request on March 21, 2007. Judge Gibbons and
Director Duff gave testimony at the hearing on the same issues that were discussed
at the House hearing.
28 Ibid., pp. 4-5.
29 U.S. Courts, News Release, “Federal Judiciary Says New Judgeships Needed,” Mar. 13,
2007, at [http://www.uscourts.gov/Press_Releases/judconf031307.html].
30 U.S. Supreme Court, Chief Justice’s “2006 Year-End Report on the Federal Judiciary,”
(Washington, DC: 2007), at
[http://www.supremecourtus.gov/publicinfo/year-end/2006year-endreport.pdf].
CRS-18
Judge Gibbons asked the House and Senate subcommittees to fund fully the
judiciary’s budget request. She stated that, “A funding shortfall for the federal courts
could result in a significant loss of existing staff, cutbacks in the level of services
provided and a diminution in the administration of justice.”
FY2008 Request.31 For FY2008, the judiciary requests $6.51 billion in total
appropriations, an 8.9% increase over the $5.98 billion enacted for FY2007.32
According to the judiciary, about 82% of the increase would provide for pay
adjustments, inflation, and other adjustments necessary to maintain current services.
The FY2008 request includes funding for 33,675 full-time-equivalent (FTE)33
positions — an increase of 2.1% over the estimated 32,972 FTEs for FY2007.
Following are highlights of the FY2008 judiciary budget request:
Supreme Court. For FY2008, the total request for the Supreme Court
(salaries and expenses plus buildings and grounds) is $78.7 million, a 6.4 % increase
over the FY2007 appropriation of $74.0 million. The total request comprises two
accounts: (1) Salaries and Expenses — $66.5 million is requested, an increase of
$3.9 million (6.3%) over the $62.6 million enacted for FY2007; and (2) Care of the
Building and Grounds — $12.2 million is requested, an increase of $0.8 million
(6.8%) over the $11.4 million enacted for FY2007. Most of the requested increase
in salaries and expenses is to fund increases in salary and benefit costs, and
inflationary fixed costs. An additional six FTEs are requested.
U.S. Court of Appeals for the Federal Circuit. This court, consisting of
12 judges, has nationwide jurisdiction and reviews, among other things, lower court
rulings in patent, trademark, and copyright cases. The FY2008 request for this
account is $28.5 million — a $3.2 million (12.7%) increase over the $25.3 million
appropriated for FY2007.
U.S. Court of International Trade. This court has exclusive jurisdiction
nationwide over the civil actions against the United States, its agencies and officers,
and certain civil actions brought by the United States (import transactions and
enforcement of federal customs and international trade laws). The FY2008 request
is for $16.7 million — a $ 0.9 million (5.7%) increase over the FY2007 appropriation
of $15.8 million that the judiciary budget submission ascribes largely to increases in
pay and benefits.
31 Administrative Office of the U.S. Courts, The Judiciary Fiscal Year 2008 Congressional
Budget Summary (Washington: Feb. 2007). Hereafter cited as Judiciary FY2008
Congressional Budget Summary.
32 The judiciary revised its request on Mar. 21, 2007, reducing the original budget request
from $6.51 billion to $6.43 billion, or an $80 million reduction. (The original FY2008
request had been estimated and submitted prior to the enactment of legislation, P.L. 110-5,
to appropriate funds for the judiciary for FY2007.) The judiciary expects to submit a
complete revised budget to the subcommittee in May 2007.
33 AOUSC provided a revised FY2008 request for 33,225 FTEs to the author on Mar. 17,
2007.
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Courts of Appeals, District Courts, and Other Judicial Services.
This budget group includes 12 of the 13 courts of appeals and 94 district judicial
courts located in the 50 states, the District of Columbia, the Commonwealth of
Puerto Rico, the territories of Guam and the U.S. Virgin Islands, and the
Commonwealth of the Northern Mariana Islands. Totaling about 95% of the
judiciary budget, the four accounts in the group — salaries and expenses, court
security, defender services, and fees of jurors and commissioners — fund most of the
day-to-day activities and operations of the federal circuit and district courts.
Salaries and Expenses. The FY2008 Salaries and Expenses request for this
budget group is $4,858.5 million — a $378.0 million (8.4%) increase over the
FY2007 level of $4,480.5 million. This account includes $4 million for the Vaccine
Injury Compensation Trust Fund. According to the budget request, this increase is
needed for inflationary and other adjustments to maintain the courts’ current services.
Court Security. This account provides for protective guard services, security
systems, and equipment for courthouses and other federal facilities to ensure the
safety of judicial officers, employees, and visitors. Under this account, a major
portion of the funding is transferred to the U.S. Marshals Service for administering
the Judicial Facility Security Program to pay for court security officers. The FY2008
request is $421.8 million — a $43.1 million (11.4%) increase over the FY2007
appropriation of $378.7 million. This increase is reportedly driven by pay and benefit
adjustments and other adjustments needed to maintain current services. Based on
projected occupancy dates for new and existing court space, the increase would also
cover the annualized costs for 34 additional court security officers expected to be
needed during FY2008. Payment to the Federal Protective Service (FPS) is also
covered under this account; $74.6 million is requested, an increase of $6.7 million
(10%) over the FY2007 appropriation of $67.9 million.
Defender Services. This account funds the operations of the federal public
defender and community defender organizations, and the compensation,
reimbursement, and expenses of private practice panel attorneys appointed by the
courts to serve as defense counsel to indigent individuals accused of federal crimes.
The FY2008 request is $859.8 million — an $83.5 million (10.8 %) increase over the
FY2007 appropriation of $776.3 million.
Fees of Jurors and Commissioners. This account funds the fees and
allowances provided to grand and petit jurors, and the compensation of jury and land
commissioners. The FY2008 request is $62.4 million — a $1.5 million (2.3%)
increase over the FY2007 appropriation of $60.9 million. The increase is due mainly
to inflationary costs associated with expenses paid to jurors.
Administrative Office of the U.S. Courts (AOUSC). As the central
support entity for the judiciary, the AOUSC provides a wide range of administrative,
management, program, and information technology services to the U.S. courts. The
AOUSC also provides support to the Judicial Conference of the United States, and
implements conference policies and applicable federal statutes and regulations. The
FY2008 request for this account is $78.5 million — a $6.1 million (8.5%) increase
over the FY2007 level of $72.4 million. The increase is reportedly for pay increases
and other inflationary adjustments and for the anticipated reduction in non-
CRS-20
appropriated funds. The AOUSC also receives non-appropriated funds from fee
collections and carryover balances to supplement its appropriations requirements.
Federal Judicial Center. As the judiciary’s research and education entity,
the center undertakes research and evaluation of judicial operations for the Judicial
Conference committees and the courts. In addition, the center provides judges, court
staff, and others with orientation and continuing education and training. The center’s
FY2007 request is $24.8 million — a $1.9 million (8.6 %) increase over the FY2007
appropriation of $22.9 million.
United States Sentencing Commission. The commission promulgates
sentencing policies, practices, and guidelines for the federal criminal justice system.
The FY2008 request is $16.2 million — a $1.6 million (10.9%) increase over the
FY2007 appropriation of $14.6 million.
Judiciary Retirement Funds. This mandatory account provides for three
trust funds that finance payments to retired bankruptcy and magistrate judges, retired
Court of Federal Claims judges, and spouses and dependent children of deceased
judicial officers. The FY2008 request is $65.4 million — a $7.1 million (12.2%)
increase over the FY2007 appropriation of $58.3 million.
General Provision Changes. According to the budget request submission,
the judiciary proposes the following new language under general provisions:
Section 406: which gives the judiciary the same delegated authority as the
executive branch to contract for space alteration projects not exceeding $100,000
(without having to go through GSA involvement).
The judiciary proposes to delete the following provisions:
Section 402: which requires the judiciary to notify Congress of appropriations
transfers and reprogramming requests (change would remove the judiciary’s
reporting requirement).
Section 404: which requires the judiciary to provide a separate, detailed financial
plan for the Judiciary Information Technology fund (change would remove the
judiciary’s reporting requirement).34
The judiciary also uses non-appropriated funds to offset its appropriations
requirement. The majority of these non-appropriated funds are from fee collections,
primarily from court filing fees. The fees are used to offset expenses within the
Salaries and Expenses account. In some instances, the judiciary also has funds which
may carry forward from one year to the next. These funds are considered
“unencumbered” because they result from savings from the judiciary’s financial plan
in areas where budgeted costs did not materialize. According to the judiciary, such
savings are usually not under its control (e.g., the judiciary has no control over the
confirmation rate of Article III judges and must make its best estimate on the needed
34 Judiciary FY2008 Congressional Budget Summary, p. 7.
CRS-21
funds to budget for judgeships, rent costs based on delivery dates, and technology
funding for certain programs).
The judiciary has stated that it will keep Congress apprised throughout the
appropriations cycle on changes in the anticipated non-appropriated funds and adjust
its budget request accordingly. The judiciary also has “encumbered” funds — no-
year authority funds for specific purposes, used when planned expenses are delayed,
from one year to the next (e.g., costs associated with space delivery, and certain
technology needs and projects).35
Title IV: District of Columbia
The authority for congressional review and approval of the District’s budget is
derived from the Constitution and the District of Columbia Self-Government and
Government Reorganization Act of 1973 (Home Rule Act).36 The Constitution gives
Congress the power to “exercise exclusive Legislation in all Cases whatsoever”
pertaining to the District of Columbia. In 1973, Congress granted the city limited
home rule powers and empowered citizens of the District to elect a mayor and city
council, but Congress retained the power to review and approve all District laws,
including the District’s annual budget. As required by the Home Rule Act, the city
council must approve a budget within 50 days after receiving a budget proposal from
the mayor. The approved budget must then be transmitted to the President, who
forwards it to Congress for its review, modification, and approval.37 Both the
President and Congress may propose financial assistance to the District in the form
of special federal payments in support of specific activities or priorities. Table 6
shows the FY2007 enacted amount, and the FY2008 request, for the District.
Table 6. District of Columbia Appropriations, FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
FY2007
FY2008
FY2008
House
Senate
Enacted
Request
Enacted
Passed
Passed
Special Federal Payments (total)
$591
$598
Source: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government.
The District of Columbia Budget and Key Issues
President’s Request. The Administration’s proposed FY2008 budget
includes $597.6 million in special federal payments to the District of Columbia.
35 Ibid., pp. 33-34.
36 See Article I, Sec. 8, clause 17 of the U.S. Constitution and Section 446 of P.L. 93-198,
87 Stat. 801.
37 87 Stat. 801.
CRS-22
Funding for the courts and criminal justice system (court operations, defender
services, offender supervision, and criminal justice coordinating council) represents
$481.7 million, or 80.6%, of the request. The President’s budget also includes $75.8
million in special federal payments for specific education initiatives, including $35.1
million for college tuition assistance, $13 million for public school enhancements,
$13 million for public charter schools, and $14.8 million for the school choice
(school voucher) program, which provides grants to eligible students to attend private
schools.
In addition to recommending $597.6 million in special federal payments to the
District of Columbia, the President’s budget also contains a number of general
provisions, including a number of so-called “social riders.” Consistent with
provisions included in previous appropriations acts, the budget includes provisions
that would prohibit the use of federal and District funds to finance or administer a
needle exchange program intended to reduce the spread of AIDS and HIV among
intravenous drug abusers and their partners, or provide abortion services except in
instances of rape or incest, or when the health of the mother is threatened. It also
includes provisions that prohibit the city from decriminalizing the use of marijuana
for medical purposes, and limit the city’s ability to use District funds to lobby for
congressional voting representation or statehood.
District Budget. On March 23, 2007, the mayor submitted a proposed budget
to the District’s city council for consideration and approval. The proposed budget
included $597.6 million in special federal payments, which is consistent with the
amount included in the President’s proposed budget for FY2008.
The District Delegate to Congress has introduced legislation, H.R. 733, that
would eliminate congressional review of the District’s budget, granting the city
budget autonomy over locally raised revenues. For several years, District officials
have complained that delays in congressional review and approval of the city’s
budget have hampered the city’s ability to efficiently plan and manage its resources.
Resident Tuition Support. The Administration requests $35.1 million for
the District of Columbia Tuition Access Grant (DCTAG) program, of which not
more than $1.2 million would be available for administrative expenses. The DCTAG
program provides tuition support through grants to institutions of higher education
(IHEs) for eligible residents of the District of Columbia by paying the difference
between in-state and out-of-state tuition (up to $10,000) at public IHEs, and up to
$2,500 per year for tuition at private non-profit IHEs that either are located in the
Washington, DC, metropolitan area, or are Historically Black Colleges and
Universities (HBCUs). The Administration’s proposal would permit DCTAG
awards to be prioritized on the basis of academic merit, income and financial need,
and other authorized factors. Funding has been provided for the program annually,
beginning with FY2000. The DCTAG program is authorized through FY2007, and
legislation (H.R. 1124 and S. 343) is being considered to extend it through FY2012.
School Improvement. The Administration requests $40.8 million for school
improvement programs in the District of Columbia. From these funds, the District
of Columbia Public Schools would be provided $13.0 million to support the
improvement of public education; the District of Columbia State Education Office
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(SEO) would be provided $13.0 million to support the expansion of public charter
schools; and the Secretary of the U.S. Department of Education would be provided
$14.8 million for the operation of the D.C. Opportunity Scholarship program, of
which $1.8 million would be available to administer and fund assessments. The D.C.
Opportunity Scholarship program enables children from families with incomes not
exceeding 185% of the poverty line to apply to receive scholarships valued at up to
$7,500 to cover the costs of tuition, fees, and transportation expenses associated with
attending participating private elementary and secondary schools located in the
District of Columbia. Scholarship recipients remain eligible to continue to
participate in the program in subsequent years, so long as their family incomes do not
exceed 300% of the poverty level. The D.C. Opportunity Scholarship program has
been funded annually beginning with FY2004 and is authorized through FY2008.
Title V: Independent Agencies
In addition to funding for the Department of the Treasury, the Executive Office
of the President, the Judiciary, and the District of Columbia, a collection of 20
independent entities are slated to receive funding through this appropriations bill in
FY2008. Table 7 lists appropriations as enacted for FY2007, and as requested for
FY2008, for each of the agencies.
Table 7. Independent Agencies Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
FY2007
FY2008
FY2008
Agency
House
Senate
Enacted
Request
Enacted
Passed
Passed
Consumer Product Safety
$63
$63
Commission
Election Assistance Commission
16
15
Federal Communications
1
1
Commission
Federal Deposit Insurance
Corporation: Office of Inspector
(31)
(27)
General (by transfer)a
Federal Election Commission
55
59
Federal Labor Relations Authority
25
24
Federal Trade Commission
59
82
General Services Administration
303
561
Merit Systems Protection Board
39
40
Morris K. Udall Foundation
4
1
National Archives and Records
331
369
Administration
National Credit Union
1
1
Administration
Office of Government Ethics
11
12
Office of Personnel Management
19,594
21,098
(total)
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FY2008
FY2008
FY2007
FY2008
FY2008
Agency
House
Senate
Enacted
Request
Enacted
Passed
Passed
Salaries and Expenses
112
102
Government Payments for
Annuitants, Employees Health
8,780
8,884
Benefits
Government Payments for
Annuitants, Employee Life
39
41
Insurance
Payment to Civil Service
10,532
11,941
Retirement and Disability Fund
Office of Special Counsel
16
16
Securities and Exchange
868
875
Commission
Selective Service System
25
22
Small Business Administration
572
464
United States Postal Service
109
89
United States Tax Court
48
45
Total: Independent Agencies
$22,140
$23,838
Source: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government.
Note: Columns may not total due to rounding.
a. Budget authority transferred to FDIC is not included in total appropriations for Title V; it is counted
as part of the budget authority in the appropriation account from which it came.
Consumer Product Safety Commission (CPSC). The commission is an
independent regulatory agency charged with protecting the public from unreasonable
product risk, and with researching and developing uniform safety standards for
consumer products.
The President’s budget request for FY2008 is $63.2 million, a $500,000 increase
over the CSPS’s FY2007 appropriation.
Election Assistance Commission (EAC). The EAC provides grant
funding to the states to meet the requirements of the Help America Vote Act,
provides for testing and certification of voting machines, studies election issues, and
promulgates voluntary guidelines for voting systems and the requirements in the act.
The commission does not have any rule-making authority and does not enforce
HAVA requirements; enforcement responsibility rests with the Department of
Justice.
The President’s FY2008 budget request includes $15.5 million for the EAC,
with $3.25 million for the National Institute of Standards and Technology(NIST), as
well as $4.83 million for protection and advocacy programs and $10.89 million for
accessibility grants administered by HHS. Congress appropriated $16.24 million for
CRS-25
the EAC for FY2007, of which $4.95 million was for NIST, $4.83 million for
protection and advocacy programs, and $10.89 million for disability access.
Federal Communications Commission (FCC). The Federal
Communications Commission, created in 1934, is an independent agency charged
with regulating interstate and international communications by radio, television, wire,
satellite, and cable. The FCC is also charged with promoting the safety of life and
property through wire and radio communications. The mandate of the FCC under the
Communications Act is to make available to all people of the United States a rapid,
efficient, nationwide, and worldwide wire and radio communications service. The
FCC performs five major functions to fulfill this charge: spectrum allocation,
creating rules to promote fair competition and protect consumers where required by
market conditions, authorization of service, enhancement of public safety and
homeland security, and enforcement. The FCC obtains the majority of its funding
through the collection of regulatory fees pursuant to Title I, Section 9, of the
Communications Act of 1934; therefore, its direct appropriation is considerably less
than its overall budget.
For FY2008, the President proposes a budget of $313 million (a direct
appropriation of $1 million and the remainder to be collected through regulatory
fees). For FY2007, the FCC will receive funding at the FY2006 level, $289 million
(a direct appropriation of $1 million and the remainder to be collected through
regulatory fees).
Federal Deposit Insurance Corporation (FDIC): OIG. The FDIC’s
Office of the Inspector General is funded from deposit insurance funds; the OIG has
no direct support from federal taxpayers. Before FY1998, the amount was approved
by the FDIC Board of Directors; the amount is now directly appropriated (through
a transfer) to ensure the independence of the OIG.
For FY2008, the President has proposed a budget of just under $27 million,
which is a 13% decrease from the FY2007 appropriation of $31 million.
Federal Election Commission (FEC). The FEC administers, and
enforces civil compliance with, the Federal Election Campaign Act (FECA)38 through
educational outreach, rulemaking, litigation, and advisory opinions to candidates and
political committees. The agency also administers the presidential public financing
system.
The President’s FY2008 budget request includes an appropriation of $59.2
million for the FEC, an 8.6% increase above the enacted FY2007 appropriation of
$54.5 million. In its FY2008 budget justification document, the FEC emphasized
efforts to contain costs by restructuring the agency’s internal processes and using
technology to improve efficiency.39 The agency did not request any additional staff
38 2 U.S.C. §431 et seq.
39 See, for example, Federal Election Commission, Fiscal Year 2008 Performance Budget
for the Federal Election Commission, Congressional Submission, Feb. 5, 2007, at
(continued...)
CRS-26
despite “[i]ncreased workloads associated with [2008] Presidential elections.”40 The
FEC stated that much of its FY2008 budget request would be used to cover a $1.6
million rent increase and to fund “mandated pay increases” for employees.41 The
FEC also proposed legislative language that would allow the agency to collect fees
for educational conferences.42
Federal Labor Relations Authority (FLRA). The FLRA is an
independent federal agency that administers and enforces Title VII of the Civil
Service Reform Act of 1978. Title VII, on Federal Service Labor-Management
Relations, gives federal employees the right to join or form a union and to bargain
collectively over the terms and conditions of employment. Employees have the right
not to join a union. The statute excludes specific agencies (e.g., the Federal Bureau
of Investigation and the Central Intelligence Agency) and gives the President the
authority to exclude other agencies for reasons of national security.
The FLRA consists of a three-member authority, the Office of General
Counsel, and the Federal Services Impasses Panel (FSIP). The authority resolves
disputes over the composition of bargaining units, charges of unfair labor practices,
objections to representation elections, and other matters. The General Counsel’s
office conducts representation elections, investigates charges of unfair labor
practices, and manages the FLRA’s regional offices. The FSIP resolves labor
negotiation impasses between federal agencies and labor organizations.
The President’s FY2008 budget proposes an appropriation of $23.7 million
for the FLRA, about $1.7 million below the agency’s FY2007 appropriation of $25.4
million.
Federal Trade Commission (FTC). The Federal Trade Commission is
an independent agency. It seeks to protect consumers and enhance competition by
eliminating unfair or deceptive acts or practices in the marketing of goods and
services and by ensuring that consumer markets function competitively. For
FY2008, the Administration requests a program level for the FTC of $240 million,
an increase of $29 million, or 13.7%, over the agency’s present level of funding. Of
the total amount provided, $139 million is to be derived from pre-merger filing fees,
$19 million from Do-Not-Call fees, and the remaining amount — $82 million — is
to be provided by a direct appropriation. For FY2007, the total budget authority
enacted was $211 million, with $129 million to be derived from filing fees and $23
million from Do-Not-Call fees, and the remaining amount — $59 million — is to be
provided by a direct appropriation.
In recent years, the FTC has mostly funded its operations by means of its pre-
merger filing fees collections and, to a lesser extent, from Do-Not-Call fees. By way
39 (...continued)
[http://www.fec.gov/pages/budget/fy2008/fy2008cbj_final.pdf], pp. 2-3.
40 Ibid., p. 3.
41 Ibid., p. 2.
42 Ibid., p. 4.
CRS-27
of a historical footnote, for FY2000 through FY2002, zero ($0) direct appropriations
were required, because the entire program level was covered by a combination of fees
and prior-year collections.
General Services Administration (GSA). The General Services
Administration administers federal civilian procurement policies pertaining to the
construction and management of federal buildings, disposal of real and personal
property, and management of federal property and records. It is also responsible for
managing the funding and facilities for former Presidents and presidential transitions.
Typically only about 1% of GSA’s total budget is funded by direct appropriations.
As shown in Table 8, for FY2008, the President requests $144.3 million for
policy and operations, $47.4 million for the Office of Inspector General, $2.5 million
for allowances and office staff for former Presidents, and $17.8 million to be
deposited into the Federal Citizen Information Center Fund.
Federal Buildings Fund (FBF). Most GSA spending is financed through
the Federal Buildings Fund. Rent assessments from agencies paid into the FBF
provide the principal source of its funding. Congress may also provide direct funding
into the FBF. Congress directs the GSA as to the allocation or limitation on spending
of funds from the FBF in provisions found accompanying GSA’s annual
appropriations.
As shown in Table 8, for FY2008, the President requests that an additional
amount of $344.5 million be deposited in the FBF and that the total limitation for the
FBF be set at $8,091 million. The President’s budget further provides that $615
million remain available until expended for new construction projects from the FBF,
and $804 million remain available until expended for repairs and alterations.
Table 8. General Services Administration Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2007
FY2008
FY2008
Fund/Office
FY2008
House
Enacted
Senate
Enacted
Request
Passed
Passed
Federal Buildings Fund
Total Limitations on
($7,555)
($8,091)
Availability of Revenues
Limitations on Obligation:
701
615
New Construction Projects
Limitations on Obligation:
618
804
Repairs and Alterations
Limitation on Obligation:
Installment Acquisition
164
156
Payments
Limitation on Obligations:
4,068
4,383
Rental of Space
CRS-28
FY2008
FY2007
FY2008
FY2008
Fund/Office
FY2008
House
Enacted
Senate
Enacted
Request
Passed
Passed
Limitation on Obligations:
2,004
2,132
Building Operations
Direct appropriation
(requested amount for deposit
94
344
in FBF)
General Activities Accounts
Government-wide Policy
52
144
Operating Expenses
83
0
Office of Inspector General
53
47
Allowances and Office Staff
3
3
for Former Presidents
Federal Citizen Information
15
18
Center Fund
Electronic Gov’t (E-Gov) Fund
3
5
Total: GSAa
$303
$561
Source: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government.
Note: Columns may not total due to rounding.
a. Total is the sum of direct appropriations deposited into the Federal Building Fund (FBF), and
appropriations for all General Service Account activities and for the Electronic Government
Fund. Total does not include limitations placed on revenues in the FBF, which are offset by
existing FBF funds and by expected revenue and collections to be paid into the fund. This
is consistent with the treatment of budget authority that is funded by offsetting fee
collections, where only the direct appropriation — the difference between budget authority
and expected collections — is included in the appropriations total.
Electronic Government Fund (E-Gov Fund). Originally unveiled in
advance of the President’s proposed budget for FY2002, the E-Gov Fund and its
appropriation have been a somewhat contentious matter between the President and
Congress. The President’s initial $20 million request was cut to $5 million, which
was the amount provided for FY2003, as well. Funding thereafter was held at $3
million for FY2004, FY2005, and FY2006. Created to support interagency e-gov
initiatives approved by the Director of OMB, the fund and the projects it funds have
been subject to close scrutiny by, and accountability to, congressional appropriators.
The President requested $5 million for FY2007 and Senate appropriators concurred,
but the House approved the usual $3 million, as recommended in the House
Appropriations Committee report.
The President’s FY2008 request for the E-Gov Fund is $5 million, the same
as was requested, and $2 million more than was appropriated, for FY2007.
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Independent Agencies Related to Personnel Management. The
FY2008 budget includes information on the portfolios of each of the agencies
involved in personnel management functions: the Federal Labor Relations Authority
(FLRA), the Merit Systems Protection Board (MSPB), the Office of Personnel
Management (OPM), and the Office of Special Counsel (OSC). Table 9 lists
appropriations as enacted for FY2007, and as requested for FY2008, for each of these
agencies.
Table 9. Independent Agencies Related to Personnel
Management Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
FY2007
FY2008
FY2008
Agency
House
Senate
Enacted
Request
Enacted
Passed
Passed
Federal Labor Relations
$25
$24
Authority
Merit Systems Protection Board
39
41
(total)
Salaries and expenses
36
38
Limitation on administrative
3
3
expenses
Office of Personnel Management
19,594
21,098
(total)
Salaries and Expenses
112
102
Limitation on administrative
113
112
expenses
Office of Inspector General
2
2
(salaries and expenses)
Office of Inspector General
(limitation on administrative
16
16
expenses)
Government Payments for
Annuitants, Employees
8,780
8,884
Health Benefits*
Government Payments for
Annuitants, Employee Life
39
41
Insurancea
Payment to Civil Service
Retirement and Disability
10,532
11,941
Funda
Office of Special Counsel
16
16
Sources: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government and President’s FY2008 budget request.
a. The annual appropriations act provides “such sums as may be necessary” for the health benefits, life
insurance, and retirement accounts. The Office of Personnel Management’s Congressional
Budget Justification for FY2008 states the FY2008 amounts for these accounts as $9.138
million (health benefits), $41 million (life insurance), and $10.523 million (retirement) at pp.
87-89. These are the same amounts that are stated in the FY2008 Budget Appendix at pp.
1003-1004.
CRS-30
The Federal Labor Relations Authority reported a decline of 32% in the
workload at its seven regional offices between 2001 and 2004, and anticipated that
the trend may increase. The authorizations for the Merit Systems Protection Board
(MSPB) and the Office of Special Counsel (OSC) expire on September 30, 2007.
MSPB projects a 2.4% increase in decisions issued for cases related to retirement,
adverse action appeals, and reduction-in-force appeals in FY2008. OSC projects a
continued increase in the number of prohibited personnel practice cases and
disclosure cases received.
The appropriation of almost $102 million for salaries and expenses at the
Office of Personnel Management (OPM) includes funding of almost $6 million
dollars for the Enterprise Human Resources Integration project, more than $1.3
million for the Human Resources Line of Business project, $340,000 for the E-
payroll project, and $170,000 for the E-training program. Among the initiatives that
OPM states that it will undertake for FY2008 are these: demonstration projects on
pay-for-performance “to replace the current General Schedule ... with a modern
classification, pay, and performance management system that is both results-driven
and market-based”; continued development of the “prescription drug audit program,
which includes audits of pharmacy benefit managers” by the OPM Inspector General;
and legislation to make technical changes in the retirement annuities of individuals
with part-time service under the Civil Service Retirement System (CSRS) and to
transition employees working in non-foreign areas (i.e., Alaska and Hawaii), from
non-foreign cost of living allowances to locality pay.43
National Archives and Records Administration (NARA). The
custodian of the historically valuable records of the federal government since
NARA’s establishment in 1934, NARA also prescribes policy and provides both
guidance and management assistance concerning the entire life cycle of federal
records. It also administers the presidential libraries system; publishes the laws,
regulations, and presidential and other documents; and assists the Information
Security Oversight Office (ISOO), which manages federal security classification and
declassification policy; and the National Historical Publications and Records
Commission (NHPRC), which makes grants nationwide to help nonprofit
organizations identify, preserve, and provide access to materials that document
American history.
The President’s FY2008 request for NARA is almost $369 million, which is
about $37 million more than was appropriated for FY2007. Of this requested
amount, almost $313 million is being sought for operating expenses, an increase of
$34 million over the FY2007 appropriation for this account. For the electronic
records archive, $58 million is being sought, a $13 million increase over the previous
fiscal year allocation; for repairs and restoration, a little less than $9 million is being
sought, which is slightly below the FY2007 appropriation; and for the NHPRC, no
appropriation is being requested, which was the President’s request for FY2007,
although Congress allocated $7 million. NARA’s FY2007 budget justification
indicates that no funding for the NHPRC grants program was being sought in order
43 FY2008 Budget Appendix, pp. 1080 (FLRA), 1091 (MSPB), 1115 (OSC), and 999, 1002,
and 1007 (OPM).
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to focus funding on operations that directly affect management, access, and the
preservation of federal records.
National Credit Union Administration (NCUA). The NCUA is an
independent federal agency funded entirely by the credit unions the agency charters,
insures, and regulates. Two entities managed by the NCUA are addressed by the
Financial Services and General Government bill. One of these, the Community
Development Revolving Loan Fund (CDRLF), makes low-interest loans and
technical assistance grants to low-income credit unions. In FY2007, the CDRLF
received an appropriation of $941,000, and the President requests $950,000 for
FY2008.
The other entity managed by NCUA, the Central Liquidity Facility (CLF),
provides a source of seasonal and emergency liquidity for credit unions. The CLF
can finance loans using its assets, and it can also borrow from the Federal Financing
Bank. Provisions in the appropriations bill set a borrowing limit for the CLF each
fiscal year. Congress also determines the level of CLF operating expenses, which are
not funded through appropriations, but by earned income. For FY2007, Congress
approved a $1.5 billion limitation on direct loans from the CLF, and the President
requests the same amount for FY2008.
Securities and Exchange Commission (SEC). The SEC administers
and enforces federal securities laws to protect investors from fraud, and to maintain
fair and orderly markets. The SEC’s budget is set through the normal appropriations
process, but funds for the agency come from fees on sales of stock, new issues of
stocks and bonds, corporate mergers, and other securities market transactions. When
the fees are collected, they go to a special offsetting account available to
appropriators, not to the Treasury’s general fund. The SEC is required to adjust the
fee rates periodically in order to make the amount collected approximately equal to
the agency’s budget.
For FY2008, the Administration requests $905.3 million, an increase of 1.4%
over FY2007. Of that amount, $875 million will come from current-year offsetting
fee collections, and the remaining $30.3 million from prior-year unobligated
balances. No appropriation from the general fund will be required. In FY2007, the
enacted budget authority was $892.6 million, of which $25.0 million was prior-year
unobligated balances. There was no direct appropriation from the general fund.
Selective Service System (SSS). The SSS is an independent federal
agency operating with permanent authorization under the Military Selective Service
Act (50 U.S.C. App.§451 et seq.). It is not part of the Department of Defense, but its
mission is to serve the emergency manpower needs of the military by conscripting
personnel when directed by Congress and the President.44 All males ages 18 through
25 and living in the United States are required to register. The induction of men into
the military via Selective Service (i.e., the draft) terminated in 1972. In January
1980, President Carter asked Congress to authorize standby draft registration of both
men and women. Congress approved funds for male-only registration in June 1980.
44 See [http://www.sss.gov/].
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Since 1972, Congress has not renewed any President’s authority to begin
inducting (i.e., drafting) anyone into the armed services. Recent efforts to provide
the President with induction authority have been rejected.45
Funding of Selective Service has remained relatively stable over the last
decade. For FY2008, the President has requested $22 million, which is $3 million
less than the FY2007 appropriation.
Small Business Administration (SBA). The SBA is an independent
federal agency created by the Small Business Act of 1953. Although the agency
administers a number of programs intended to assist small firms, arguably its three
most important functions are to guarantee — principally through the agency’s Section
7(a) general business loan program — business loans made by banks and other
financial institutions; to make long-term, low-interest loans to small businesses,
nonprofits, and households that are victims of hurricanes, earthquakes, other physical
disasters, and acts of terrorism; and to serve as an advocate for small business within
the federal government.
The Administration requests $463.5 million in new budget authority for
FY2008. This is a decrease of $108.4 million from FY2007’s enacted $571.9
million. The Administration has requested no new budget authority for the disaster
loan program account for FY2008; in FY2007 the disaster loan program received
$112.6 million. The Administration is proposing to use up to $156.0 million in
unused budget authority carried over from previous years to operate the disaster loan
program in FY2007. Lending authority would stay the same for all loan programs.
United States Postal Service (USPS).46 The U.S. Postal Service
generates nearly all of its funding — about $73 billion annually — by charging users
of the mail for the costs of the services it provides.47 Congress does provide an
annual appropriation, however, to compensate USPS for revenue it forgoes in
providing, at congressional direction, free mailing privileges to the blind48 and
overseas voters.49 Appropriations for these purposes are authorized by the Revenue
45 See H.R. 163, Oct. 5, 2004, failed by Yeas and Nays: (2/3 required): 2 - 402 (Roll no.
494).
46 Also see CRS Report RS21025, The Postal Revenue Forgone Appropriation: Overview
and Current Issues, by Nye Stevens.
47 United States Postal Service Annual Report 2006 (Washington: USPS, 2006), p. 3.
48 84 Stat. 757; 39 U.S.C. §3403. See also USPS, Mailing Free Matter for Blind and
Visually Handicapped Persons: Questions and Answers, Publication 347 (Washington:
USPS, May 2005), at [http://www.usps.com/cpim/ftp/pubs/pub347.pdf].
49 Members of the armed forces and U.S. citizens who live abroad are eligible to register and
vote absentee in federal elections under the provisions of the Uniformed and Overseas
Citizens Absentee Voting Act of 1986 (42 U.S.C.§1973ff-ff-6). See CRS Report RS20764,
The Uniformed and Overseas Citizens Absentee Voting Act: Background and Issues, by
Kevin J. Coleman.
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Forgone Reform Act of 1993 (RFRA).50 This act also authorizes Congress to
reimburse USPS $29 million each year until 2035, for postal services provided at
below-cost rates to not-for-profit organizations — at congressional direction — in
the early 1990s.
In its FY2008 budget, the Administration proposes a total appropriation of
$88.9 million,51 $20 million less than was enacted for FY2007. Of this, $64.5
million would be for revenue forgone in FY2008, and $24.4 million would be for a
reconciliation adjustment for underestimated revenue forgone in FY2005.
In its FY2008 budget submission, USPS requested a $153.4 million
appropriation.52 Of this amount, $29 million would be for the annual reimbursement
under RFRA; $83.5 million would be for revenue forgone; and $40.9 million would
be for reconciliation adjustments for underestimated revenue forgone in FY2005 and
FY2006.
The Administration’s FY2008 budget not only proposes less revenue forgone
funding than USPS has requested, but also would eliminate the $29 million annual
reimbursement authorized by RFRA. (The Administration also proposed termination
of the annual reimbursement in FY2005, FY2006, and FY2007, but Congress chose
to provide the funding, as it has each year since FY1994.) Additionally, the
Administration’s budget proposes that none of the $88.9 million appropriation to
USPS would be available for obligation until October 1, 2008, which is in FY2009.
Since FY1994, appropriations to USPS have delayed until the following fiscal year
only the revenue forgone portion of the appropriation; the remainder of the
appropriation was made available for obligation in the upcoming fiscal year.
United States Tax Courts (USTC). A court of record under Article I of
the Constitution, the United States Tax Court is now an independent judicial body
in the legislative branch and has jurisdiction over various tax matters as set forth in
Title 26 of the United States Code. The court is headquartered in Washington, DC,
but its judges conduct trials in many cities across the country.
The President requested $45.3 million for FY2008, about $2 million below
the USTC’s FY2007 appropriation.
50 107 Stat. 1267, 39 U.S.C. §2401(c)-(d). See also CRS Report RS21025, The Postal
Revenue Forgone Appropriation: Overview and Current Issues, by Kevin R. Kosar.
51 Office of Management and Budget, President’s Budget FY2008 — Appendix (Washington:
GPO, 2007), p. 1116.
52 USPS, “Fiscal Year 2008 Appropriation Request,” Dec. 6, 2006, at
[http://www.usps.com/financials/_pdf/Appropriations-2008_Public.pdf].
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General Provisions Government-Wide
The Financial Services and General Government Appropriations bill includes
general provisions which apply either government-wide or to specific agencies or
programs. There also may be general provisions at the end of each individual title
within the appropriations act which relate only to agencies and accounts within that
specific title. The Administration’s proposed language for government-wide general
provisions is included in the FY2008 Budget, Appendix.53 Most of the provisions
continue language that has appeared under the General Provisions title for several
years. For various reasons, Congress has determined that reiterating the language is
preferable to making the provisions permanent. Presented below are some of the
government-wide general provisions that were included in P.L. 109-115, the
Transportation, Treasury, Housing and Urban Development, the Judiciary, the
District of Columbia, and Independent Agencies Appropriations Bill for FY2006,54
but that are not included in the FY2008 budget proposal. (The section numbers refer
to the provisions as they appeared in P.L. 109-115. H.R. 5576, the FY2007
Transportation, Treasury, Housing and Urban Development, the Judiciary, the
District of Columbia, and Independent Agencies Appropriations Bill, as passed by
the House and reported in the Senate, was not enacted.)
! Section 809, which prohibits payment to political appointees who
are filling positions for which they have been nominated, but not
confirmed.
! Section 819, which prohibits the obligation or expenditure of
appropriated funds for employee training that (1) does not meet
identified needs for knowledge, skills, and abilities bearing directly
upon the performance of official duties; (2) contains elements likely
to induce high levels of emotional response or psychological stress
in some participants; (3) does not require prior employee notification
of the content and methods to be used in the training and written end
of course evaluation; (4) contains any methods or content associated
with religious or quasi-religious belief systems or “new age” belief
systems; or (5) is offensive to, or designed to change, participants’
personal values or lifestyle outside the workplace.
! Section 820, which prohibits the use of appropriated funds to
implement or enforce employee non-disclosure agreements if they
do not contain whistleblower protection clauses.
! Section 823, which requires that the Committees on Appropriations
approve the release of any “non-public” information, such as mailing
or telephone lists, to any person or any organization outside the
federal government.
53 FY2008 Budget, Appendix, pp. 9-12.
54 P.L. 109-115, Nov. 30, 2005, 119 Stat. 2495-2507.
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! Section 834, which states that Congress recognizes the United States
Anti-Doping Agency as the official anti-doping agency for Olympic,
Pan American, and Paralympic sports in the United States.
! Section 836, which prohibits the use of appropriated funds to
implement or enforce restrictions or limitations on the Coast Guard
Congressional Fellowship Program or to implement OPM’s
proposed regulations limiting the detail of executive branch
employees to the legislative branch.
! Section 837, which requires agencies to report to Congress on the
amount of the acquisitions made from entities that manufacture the
articles, materials, or supplies outside the United States.
! Section 839, which requires appropriate executive department and
agency heads either to transfer funds to, or to reimburse, the Federal
Aviation Administration to ensure the uninterrupted, continuous
operation of the Midway Atoll airfield.
! Section 840, which provides certain requirements for conducting a
public-private competition for the performance of an activity that is
not inherently governmental for executive agencies with fewer than
100 full-time employees.
! Section 842, which prohibits the use of funds to convert an activity
or function of an executive agency to contractor performance if more
than 10 federal employees perform the activity, unless analysis
reveals that savings would exceed 10% of the most efficient
organization’s personnel-related costs for performance of the activity
or function by federal employees, or $10 million, whichever is
lesser.
! Section 845, which precludes contravention of the Privacy Act.
The FY2008 budget proposes a new Section 834 that would provide a 3.0%
pay (annual and locality pay combined) adjustment for federal civilian employees.