Order Code RL33998
Financial Services and General Government
(FSGG): FY2008 Appropriations
Updated December 20, 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
measures 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 one of the regular appropriations bills that Congress considers each
year. It is designed to supplement the information provided by the House and Senate
Appropriations Subcommittees on Defense. For both defense authorization and
appropriations, this report summarizes the status of the bills, their scope, major issues,
funding levels, and related congressional activity. This report is updated as events warrant
and lists the key CRS staff relevant to the issues covered as well as related CRS products.
NOTE: A Web version of this document with active links is
available to congressional staff at [http://apps.crs.gov/cli/cli.aspx?
PRDS_CLI_ITEM_ID=221&from=3&fromId=73].


Financial Services and General Government (FSGG):
FY2008 Appropriations
Summary
The FY2008 Financial Services and General Government (FSGG)
appropriations bill (H.R. 2829) 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 funded by 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).
On June 28, 2007, the House approved $43.8 billion for the FSGG bill, a $3.1
billion increase over FY2007 enacted funding and $101 million above the President’s
FY2008 request. Discretionary spending in the House bill totaled $21.4 billion, a
decrease of $245 million from the President’s request, but $1.9 billion more than was
enacted in FY2007. The Senate appropriations FSGG subcommittee marked up its
version of the bill July 10, and the full committee reported it July 12. The Senate bill
recommended $44.2 billion in appropriations, a $3.4 billion increase over FY2007
enacted funding and $414 million above the President’s FY2008 request.
Discretionary spending in the Senate bill totaled $21.8 billion, approximately $20
million above the President’s request and $2.3 billion more than was enacted in
FY2007. The Senate took no further action on H.R. 2829. The agencies included in
the FSGG appropriations bill were funded from the start of the 2007 fiscal year until
December 31, 2007, by a series of continuing resolutions. Under the continuing
resolutions, FSGG agencies were generally funded at FY2007 rates, although the
District of Columbia had special funding provisions.
FSGG appropriations were ultimately included in an omnibus appropriations bill
(H.R. 2764), which was approved by the Senate on December 18 and by the House
on December 19. The omnibus bill provided a total of $43.3 billion for FSGG
agencies, $2.6 billion more than enacted in FY2007, but $421 million less than
requested by the President. Compared with H.R. 2829, the omnibus provided $583
million less than the amount approved by the House, and $829 million less than the
amount approved by the Senate. Discretionary spending in the omnibus totaled $20.6
billion, which was $1.1 billion more than enacted in FY2007, but $1.1 billion less
than the amount requested by the President. Compared with H.R. 2829, discretionary
funding in the omnibus was $1.1 billion below the amount approved by the Senate,
and $833 million less than the amount approved by the House.
The tables throughout this report have been updated to reflect amounts provided
in the omnibus appropriations bill, but the text has not. This report will be updated
in full after the President takes action on the omnibus.


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
Garrett Hatch
G&F
7-7822
Commodity Futures Trading Commission
Mark Jickling
G&F
7-7784
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 System
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
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 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Overview of FY2008 Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Key Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Title I: Department of the Treasury . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Department of the Treasury Budget and Key Issues . . . . . . . . . . . . . . . . . . . 6
Treasury Offices and Bureaus (Excluding the IRS) . . . . . . . . . . . . . . . . 7
Internal Revenue Service (IRS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Title II: Executive Office of the President and Funds Appropriated
to the President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
The Executive Office of the President Budget and Key Issues . . . . . . . . . . 18
Consolidation Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Transfer Authority Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Enterprise Services Proposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Title III: The Judiciary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
The Judiciary Budget and Key Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Cost Containment Initiatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Judicial Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Workload . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Judgeships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Judicial Pay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
House and Senate Budget Hearings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
FY2008 Request and Congressional Action . . . . . . . . . . . . . . . . . . . . 30
Supreme Court . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
U.S. Court of Appeals for the Federal Circuit . . . . . . . . . . . . . . . . . . . 32
U.S. Court of International Trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Courts of Appeals, District Courts, and Other Judicial Services . . . . . 33
Administrative Office of the U.S. Courts (AOUSC) . . . . . . . . . . . . . . 35
Federal Judicial Center . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
United States Sentencing Commission . . . . . . . . . . . . . . . . . . . . . . . . 35
Judiciary Retirement Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
General Provision Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Administrative Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Title IV: District of Columbia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
The District of Columbia Budget and Key Issues . . . . . . . . . . . . . . . . . . . . 39
President’s Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
District Budget . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
H.R. 2829 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Continuing Resolution and D.C. Budget Autonomy . . . . . . . . . . . . . . 42

Title V: Independent Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Commodity Futures Trading Commission (CFTC) . . . . . . . . . . . . . . . 44
Consumer Product Safety Commission (CPSC) . . . . . . . . . . . . . . . . . 45
Election Assistance Commission (EAC) . . . . . . . . . . . . . . . . . . . . . . . 45
Federal Communications Commission (FCC) . . . . . . . . . . . . . . . . . . . 46
Federal Deposit Insurance Corporation (FDIC): OIG . . . . . . . . . . . . . 47
Federal Election Commission (FEC) . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Federal Trade Commission (FTC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
General Services Administration (GSA) . . . . . . . . . . . . . . . . . . . . . . . 50
Independent Agencies Related to Personnel Management . . . . . . . . . 52
Federal Labor Relations Authority (FLRA) . . . . . . . . . . . . . . . . . . . . . 54
Merit Systems Protection Board (MSPB) . . . . . . . . . . . . . . . . . . . . . . 54
Office of Personnel Management (OPM) . . . . . . . . . . . . . . . . . . . . . . 55
Office of Special Counsel (OSC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
National Archives and Records Administration (NARA) . . . . . . . . . . 58
National Credit Union Administration (NCUA) . . . . . . . . . . . . . . . . . 59
Securities and Exchange Commission (SEC) . . . . . . . . . . . . . . . . . . . 60
Selective Service System (SSS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Small Business Administration (SBA) . . . . . . . . . . . . . . . . . . . . . . . . 61
United States Postal Service (USPS) . . . . . . . . . . . . . . . . . . . . . . . . . . 62
United States Tax Courts (USTC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
General Provisions Government-Wide . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Competitive Sourcing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Cuba Sanctions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
List of Tables
Table 1. Status of FY2008 Financial Services and
General Government Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Table 2. Financial Services and General Government Appropriations,
by Title, FY2007-FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Table 3. Department of the Treasury Appropriations, FY2007 to FY2008 . . . . . . 5
Table 4. Executive Office of the President and Funds Appropriated
to the President, FY2007 to FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Table 5. The Judiciary Appropriations, FY2007 to FY2008 . . . . . . . . . . . . . . . 25
Table 6. District of Columbia Appropriations, FY2007 to FY2008:
Special Federal Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Table 7. Independent Agencies Appropriations,
FY2007 to FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Table 8. General Services Administration Appropriations,
FY2007 to FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Table 9. Independent Agencies Related to Personnel Management
Appropriations, FY2007 to FY2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

Financial Services and General Government
(FSGG): FY2008 Appropriations
Most Recent Developments
On June 28, 2007, the House approved $43.8 billion for agencies funded
through the Financial Services and General Government (FSGG) appropriations bill
(H.R. 2829), a $3.1 billion increase over FY2007 enacted funding and $101 million
above the President’s FY2008 request.1 Discretionary spending in the bill totaled
$21.4 billion, a decrease of $245 million from the President’s request, but $1.9
billion more than was enacted in FY2007. The Senate appropriations FSGG
subcommittee marked up its version of the bill July 10, and the full committee
reported it July 12. The Senate bill recommended $44.2 billion in appropriations, a
$3.4 billion increase over FY2007 enacted funding and $414 million above the
President’s FY2008 request.2 Discretionary spending in the Senate bill totaled $21.8
billion, approximately $20 million above the President’s request and $2.3 billion
more than was enacted in FY2007. The Senate took no further action on H.R. 2829,
and the agencies included in the FSGG appropriations bill were funded until
December 31, 2007, by a series of continuing resolutions. Under the continuing
resolutions, FSGG agencies were generally funded at FY2007 rates.3
FSGG appropriations were ultimately included in an omnibus appropriations bill
(H.R. 2764), which passed the Senate on December 18, and the House on December
19, 2007. The omnibus bill provided a total of $43.3 billion for FSGG agencies, $2.6
billion more than enacted in FY2007, but $421 million less than requested by the
President. Compared with H.R. 2829, the omnibus provided $583 million less than
approved by the House, and $829 less than approved by the Senate. Discretionary
spending in the omnibus totaled $20.6 billion, which was $1.1 billion more than
enacted in FY2007, but $1.1 billion less than the amount requested by the President.
Compared with H.R. 2829, discretionary funding in the omnibus was $1.1 billion
1 On June 11, the House Appropriations Committee approved $43.9 billion for the Financial
Services and General Government (FSGG) appropriations bill, but the bill was sent back to
committee before reaching the floor so that earmarks could be added. The amended FSGG
bill, with earmarks, was then approved by the Appropriations Committee June 21.
2 The Senate bill includes funding for the Commodity Futures Trading Commission (CFTC),
which is funded through the agriculture appropriations bill (H.R. 3161) in the House.
3 See the section on the District of Columbia for more information. Section 112 of the
continuing resolution provides that the “amounts made available ... for civilian personnel
compensation and benefits in each department and agency may be apportioned up to the rate
for operations necessary to avoid furloughs.” This authority may be used after the
department or agency “has taken all necessary actions to reduce or defer non-personnel-
related administrative expenses.”

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below the amount approved by the Senate, and $883 million less than the amount
approved by the House.
Table 1 notes the status of both H.R. 2829 and the omnibus appropriations bill.
While the tables throughout this report have been updated to reflect amounts
provided in the omnibus, the text has not. This report will be updated in full after the
President takes action on the omnibus.
Table 1. Status of FY2008 Financial Services and General
Government Appropriations
Subcommittee
House
House
Senate
Senate
Omnibus
Markup
Report Passage Report Passage
Conf.
Passage
(H.R.
(H.R.
(H.R.
(H.R.
Report
Public
House
Senate
2829)
2829)
2829)
2829) (Omnibus) House Senate
Law
H.Rept.
S.Rept.
06/05/07 07/10/07 110-207 06/28/07 110-129
12/19/0712/18/07
06/11/07
07/12/07
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
Agencies, commonly referred to as “TTHUD.”4 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.5
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,
4 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.
5 The agencies are the Federal Communications Commission (FCC), the Federal Trade
Commission (FTC), the Securities and Exchange Commission (SEC), and the Small
Business Administration (SBA).

CRS-3
Justice, Science, and Related Agencies Subcommittee.6 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.7 As a result of this reorganization, the
House and Senate FSGG subcommittees have nearly identical jurisdictions.8
The FY2008 FSGG appropriations bill (H.R. 2829) provides funding through
five titles, each of which is discussed in a separate section of this report. In addition,
there is a section on General Provisions. The language for government-wide general
provisions was proposed by the Administration in the appendix to the FY2008 budget
request, and was included in Title VII of both the House and Senate bills.
The House Appropriations Subcommittee on Financial Services and General
Government is the primary source of the House funding figures used throughout the
report. Senate funding figures are taken from S.Rept. 110-129, which accompanied
H.R. 2829. Other sources include the President’s FY2008 budget request and agency
budget materials.
Overview of FY2008 Appropriations
On June 28, 2007, the House approved $43.8 billion for the FY2008 FSGG
appropriations bill. Compared to FY2007 enacted amounts, the House bill would
increase appropriations for each of the five titles, with the largest gains proposed for
the District of Columbia (+10.8%) and the smallest for the Executive Office of the
President (+0.25%). The House bill would also increase funding for the Department
of the Treasury (+5.4%), the Judiciary (+4.7%), and Independent Agencies (+9.7%).
Compared to the President’s FY2008 request, the House bill would increase funding
for the District of Columbia (+9.5%), the Department of the Treasury (+1.0%), and
Independent Agencies (+1.0%). Funding under the House bill would decrease
relative to the President’s request for the Judiciary (-3.9%) and the Executive Office
of the President (-2.1%).
On July 12, 2007, the Senate Appropriations Committee reported its version of
the FSGG appropriations bill. Compared to FY2007 enacted amounts, the Senate bill
would increase funding for each of the five titles, with the largest gains proposed for
Independent Agencies (+11.0%) and the smallest for the Executive Office of the
President (+0.9%). The Senate bill would also increase funding for the Department
of the Treasury (+5.4%), the Judiciary (+6.0%), and the District of Columbia
(+3.8%). Compared to the President’s FY2008 request, the Senate bill would
6 The agencies are the FCC, FTC, SEC, and SBA.
7 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.
8 The Commodity Futures Trading Commission (CFTC) is under the jurisdiction of the
FSGG Subcommittee in the Senate but not in the House.

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increase funding for the Department of the Treasury (+0.9%), the District of
Columbia (+2.7%), and Independent Agencies (+2.0%). Funding under the Senate
bill would decrease relative to the President’s request for the Executive Office of the
President (-1.5%) and the Judiciary (-2.7%).
No further action on H.R. 2829 has been taken by the Senate. The agencies
included in the FSGG appropriations bill were funded from the start of FY2007 until
December 31, 2007, by a series of continuing resolutions. Under the continuing
resolutions, FSGG agencies were generally funded at FY2007 rates, although the
District of Columbia had special funding provisions.9 FSGG agencies were
ultimately funded through an omnibus appropriations bill, H.R. 2764, which passed
the Senate on December 18 and passed the House on December 19.
Table 2 lists, by title, the enacted amounts for FY2007, the President’s request
for FY2008, funding levels approved by the House under H.R. 2829, the amounts
reported by the Senate Appropriations Committee under H.R. 2829, and the amounts
approved in the omnibus.
Table 2. Financial Services and General Government
Appropriations, by Title, FY2007-FY2008
(in millions of dollars)
FY2008
FY2008
House
Senate
Passed
Reported
FY2007
FY2008
(H.R.
(H.R.
FY2008
Title
Enacted
Request
2829)
2829)
Omnibus
Title I: Department of the Treasury
$11,625
$12,137
$12,257
$12,249
$11,996
Title II: Executive Office of the
720
737
722
727
682
President
Title III: The Judiciary
5,980
6,511
6,258
6,337
6,246
Title IV: District of Columbia
591
598
655
614
610
Title V: Independent Agencies
21,797
23,718
23,911
24,299
23,745
Total
$40,713
$43,701
$43,802
$44,226
$41,996
Sources: Budget authority tables provided by House Appropriations Subcommittee on Financial
Services and General Government, and S.Rept. 110-129. Columns may not equal the 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 — encompasses a number of
controversial issues. Several key issues, identified below, may be among those
before Congress.
9 See the section of this report on the District of Columbia for more information.

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! Department of the Treasury. Does the proposed budget provide
adequate funding for enforcement, taxpayer services, and business
systems modernization at the Internal Revenue Service?
! Executive Office of the President (EOP). Should Congress 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 should Congress 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?
! Independent Agencies. Should Congress 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 Treasury10
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, the President’s FY2008 request, the FY2008 amount
approved by the House, and the FY2008 amount passed by the Senate.
Table 3. Department of the Treasury Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
House
Senate
Passed
Reported
FY2007
FY2008
(H.R.
(H.R.
FY2008
Program or Account
Enacted
Request
2829)
2829)
Omnibus
Departmental Offices
$216
$250
$251
$252
$248
Department-wide Systems and Capital
30
19
19
19
19
Investments
Office of Inspector General
17
18
18
18
18
Treasury Inspector General for Tax
133
141
141
141
141
Administration
Air Transportation Stabilization
Programa

-4
-4
-4
-4
10 This section was written by Gary Guenther, Analyst in Industry Economics, Government
and Finance Division.

CRS-6
FY2008
FY2008
House
Senate
Passed
Reported
FY2007
FY2008
(H.R.
(H.R.
FY2008
Program or Account
Enacted
Request
2829)
2829)
Omnibus
Community Development Financial
55
29
100
90
94
Institutions Fund
Treasury Building and Annex Repair





and Restoration
Financial Crimes Enforcement
73
86
83
86
86
Network
Financial Management Service
235
235
234
235
234
Alcohol and Tobacco Tax and Trade
91
94
94
97
94
Bureau
Bureau of the Public Debt
178
173
173
173
173
Internal Revenue Service, Total
10,597
11,095
11,147
11,142
10,892
Taxpayer Services
2,138
2,103
2,155
2,149
2,150
Enforcement
4,686
4,925
4,925
4,925
4,780
Operations Support
3,545
3,770
3,770
3,770
3,680
Business Systems Modernization
213
282
282
282
267
Health Insurance Tax Credit
15
15
15
15
15
Administration
Total: Department of the Treasury
$11,625
$12,137 $12,257
$12,249
$11,996
Sources: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government, and S.Rept. 110-129. Columns may not equal the total due to
rounding.
a. The negative appropriation for the Air Transportation Stabilization Program reflects a rescission.
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

CRS-7
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.11 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
Treasury 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 $11.625 billion in appropriated funds, or 0.4%
more than it received in FY2006. Most of these funds are being used to finance the
operations of the IRS, which is receiving $10.597 billion in FY2007. The remaining
$1.028 billion is distributed among Treasury’s 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, $178 million.
FY2008 Budget Proposal. For FY2008, the Bush Administration is asking
Congress to approve $12.137 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 $1.042 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,
11 Four law enforcement agencies were transferred from the Treasury Department to the
Department of Homeland Security in 2002: Bureau of Alcohol, Tobacco, and Firearms; U.S.
Secret Service; Federal Law Enforcement Agency; and U.S. Customs Service (now U.S.
Customs and Border Protection).

CRS-8
$235 million; ATB, $94 million; and Bureau of the Public Debt, $173 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
FY2008.12 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.13 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
Investment in the United States, and by eliminating funding for the Bank Enterprise
Awards program, which is administered through the CDFI.14
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.”15 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
12 U.S. Department of the Treasury, FY2008 Budget in Brief (2007), p. 10.
13 See the written testimony of Treasury Secretary Paulson before the House Appropriations
Subcommittee on Financial Services and General Government on March 28, 2007, at
[http://www.ustreas.gov/press/releases/hp329.htm].
14 Treasury, FY2008 Budget in Brief, p. 3.
15 Ibid., p. 4.

CRS-9
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.16
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 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.”17
House-Passed Version of H.R. 2829. The House approved $12.257
billion for the operations of the Treasury Department and its operating bureaus in
FY2008. This amount is $120.5 million more than the amount requested by the
Administration and $632 million above FY2007 funding.
Under the measure, three Treasury accounts would receive more in appropriated
funds in FY2008 than the Administration has requested. Specifically, departmental
offices would receive $251 million in FY2008 (or $450,000 more than the amount
requested by the Administration). Of this amount, $56.5 million would go to the
Office of Terrorism and Financial Intelligence ($250,000 above the Administration’s
budget request) and $900,000 to the Office of Financial Education ($200,000 above
the Administration’s budget request). CDFI would receive $100 million (or $71
million more than the amount requested by the Administration). The House
Appropriations Committee has recommended that $13.5 million of $100 million be
used for administrative costs, and that no less than another $14 million be set aside
for the Bank Enterprise Award program.18 The IRS would receive $11.147 billion,
or $52 million more than the amount requested by the Administration.
16 Ibid., pp. 38-39.
17 Ibid., p. 6.
18 U.S. Congress, House Committee on Appropriations, Financial Services and General
Government Appropriations Bill, 2008
, report to accompany H.R. 2829, H.Rept. 110-207,
110th Cong. 1st sess. (Washington: GPO, 2007), p. 23.

CRS-10
Two Treasury accounts would be funded at lower levels in FY2008 than the
Administration wanted. Specifically, FinCEN would receive $83 million, or $2.5
million less than the amount requested by the Administration. The recommended
reduction in spending reflected a concern that FinCEN would not be ready anytime
soon to undertake a planned border wire transfer initiative.19 The FMS would receive
$234 million, or $768,000 less than the amount requested by the Administration.
About $9 million of this amount would be set aside for “information systems
modernization initiatives” and would be available until September 30, 2010.20
Six Treasury accounts would receive the same amount of funding that was
recommended in the Administration’s budget request. They are department-wide
systems and capital investments ($19 million), the Office of the Inspector General
($18 million), TIGTA ($140.5 million), the Air Transportation Stabilization program
(a rescission of $4 million), ATB ($93.5 million), and the Bureau of Public Debt
($173 million).
The version of H.R. 2829 passed by the House would also require the Treasury
Department to prepare an “operating plan” for FY2008 and submit it to the House
Appropriations Committee within 60 days of the bill’s enactment.21 The plan would
have to provide figures on funding and full-time employment for all offices and
operating bureaus in FY2007 and FY2008, and detailed information on any
“initiative, major procurement, and program at the Department.” In addition, the
plan would have to indicate the number of full-time employees at OFAC working on
Cuba sanctions and the number of full-time employees working on sanctions
programs targeted at foreign terrorist organizations.22
Members of the House adopted by voice vote a controversial amendment that
would prevent the Treasury Department from enforcing a rule adopted in 2005 that
effectively restricts sales of U.S. agricultural products to Cuba. The rule requires
payments for such products to be made before a ship leaves port.
Senate-Reported Version of H.R. 2829. The Senate Appropriations
Committee favorably reported an amended version of H.R. 2829 on July 12. It would
provide $12.249 billion in appropriated funds for Treasury in FY2008, or $113
million more than the amount requested by the Bush Administration but $8 million
less than the amount approved by the House.
Of this amount, the IRS would receive $11.142 billion (or $6 million less than
the House bill); departmental offices, $252 million (or $1 million more than the
House bill); department-wide systems and capital investments program, $19 million
(the same as the House bill); Office of Inspector General, $18 million (the same as
the House bill); TIGTA, $141 million (the same as the House bill); the Air
Transportation Stabilization program, a recision of $4 million (the same as the House
19 Ibid., p. 20.
20 Ibid., p. 21.
21 Ibid., p. 14.
22 Ibid., pp. 15-16.

CRS-11
bill); FinCEN, $86 million (or $3 million more than the House bill); FMS, $235
million (or $1 million more than the House bill); ATB, $97 million (or $3 million
more than the House bill); Bureau of the Public Debt, $173 million (the same as the
House bill); and CDFI, $90 million (or $10 million less than the House bill).
The committee endorsed the Administration’s request to spend $56.2 million
(or $11.8 million more than the amount appropriated for FY2007) on the Office
Terrorism and Financial Intelligence in FY2008. Among the departments under the
direction of the Office, the Office of Foreign Assets Control would receive an
additional $1.4 million in funding; the Office of Intelligence Analysis, an additional
$2.0 million; and the Office of Terrorist Financing and Financial Crimes, an
additional $0.6 million. In its report on H.R. 2829, the committee urges Treasury to
“harness [its] unique expertise and assume a stronger leadership role in the
[intelligence community] on illicit finance issues.”23 As a step in that direction, the
committee directs the Department to work with the Director of National Intelligence
to develop a “mission plan for financial intelligence,” and to report to the committee
on the status of this collaborative effort by September 30, 2008.
Like the House-passed version of H.R. 2829, the version reported by the
committee would appropriate much more money for the CDFI than the amount
requested by the Bush Administration. The committee opposes the proposed
reduction on the grounds that the programs supported by CDFI “play an important
role in providing financial services to underserved communities in both urban and
rural communities across the country.”24 Of the $90 million in funding for CDFI
approved by the committee, $8 million would be reserved for “grants, loans, and
technical assistance and training programs to benefit Native American, Alaskan
Natives, and Native Hawaiian communities.”
In marking up the bill on July 12, the committee approved a controversial
amendment that would both limit the ability of Treasury to enforce certain
regulations restricting sales of U.S. agricultural products to Cuba and dismantle some
of the barriers to traveling there to sell agricultural and medical products. The
amendment is broader in scope than a similar one adopted by the House during its
consideration of H.R. 2829.
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
23 U.S. Congress, Senate Committee on Appropriations, Financial Services and General
Government Appropriations Bill, 2008
, report to accompany H.R. 2829, 110th Cong., 1st
sess., July 13, 2007 (Washington: GPO, 2007), p. 12.
24 Ibid., p. 21.

CRS-12
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,
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.

CRS-13
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%.25
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.”26 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.27 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
hiring and training sufficient numbers of enforcement agents to replace those who
have retired or quit in recent years.
Review of Administration’s FY2008 Budget Proposal by the IRS
Oversight Board. The IRS Oversight Board came into existence through the IRS
Restructuring and Reform Act of 1998. Its primary responsibilities are to oversee
IRS’s administration of the federal tax code and to ensure that the agency has the
resources and management needed to carry out its mission and achieve its strategic
objectives. Section 7802 of the Internal Revenue Code (IRC) requires the Board to
review and approve the annual budget requests submitted by IRS to the Treasury
25 Ibid., p. 10.
26 Ibid., p. 55.
27 Ibid., p. 64.

CRS-14
Department, and to assess whether the annual budget request for the IRS submitted
to Congress supports the strategic plans of the agency.
The Board released its assessment of the Administration’s FY2008 budget
request for the IRS in April 2007.28 While the Board took a mostly favorable view
of the Administration’s proposal, it favored giving the agency a larger budget than
the Administration requested. The Board commended the Administration for seeking
a 4.7% increase in the IRS’s budget for FY2008 “during a time when discretionary
spending is under great constraints and there is stiff competition among federal
departments and agencies for resources.”29 It also praised the Administration for
recognizing “the importance of the IRS’ mission to the fiscal well-being of our nation
and (for) proposing these important and much needed investments at this time.” In
the Board’s view, both its budget proposal and the Administration’s are “focused on
improving the ability of the IRS to aggressively pursue its strategic goals in order to
reduce the tax gap.”30 It described the Administration’s budget proposal as “clearly
aligned with the IRS’ most recent strategic plan.”
At the same time, the Board wanted more funds appropriated for enforcement
and infrastructure than the Administration requested. Specifically, the Board called
for spending $105 million more on a variety of enforcement initiatives than the
Administration’s budget request, and $205 million more on projects related to the
BSM and newly installed information systems.31 In the Board’s view, these added
expenditures are critical to the success of current plans to improve taxpayer
compliance and shrink the tax gap.
House-Passed Version of H.R. 2829. H.R. 2829, as passed by the House,
would provide $11.147 billion in appropriated funds for the IRS in FY2008. This
amount is $52 million more than the amount requested by the Administration.
This entire difference lies in recommended funding for taxpayers services. H.R.
2829 would provide $2.155 billion for such services in FY2008, or $52 million more
than the amount requested by the Administration. Of this amount, $8 million would
be set aside for low-income taxpayer clinic grants, up to $4.1 million would be
funneled into the Tax Counseling for the Elderly program, and no less than $179.6
million would be used to fund the operations of the Taxpayer Advocate Service. In
addition, the bill recommends spending $71.5 million for pre-filing services
management (or $6.2 million more than the Administration requested), $127.5
million for taxpayer communications and education (or $12.8 million more than the
Administration requested), $70 million for media and publications (or $5.2 million
more than the Administration requested), and $165.2 million for account
management and assistance (or $18.3 million more than the Administration
requested). In its report on H.R. 2829, the House Appropriations Committee notes
28 See IRS Oversight Board, FY2008 IRS Budget Recommendation: Special Report
(Washington: April 2007).
29 Ibid., p. 3.
30 Ibid., p. 7.
31 Ibid., p. 14.

CRS-15
that the recommended increase in spending on taxpayer services is intended to
counter recent reductions in taxpayer services and give the IRS the resources it needs
“to strengthen, improve, and expand taxpayer service.”32
H.R. 2829 would also give the IRS $4.925 billion for enforcement (including
$116.7 million to examine ways to improve taxpayer compliance), $3.770 billion for
operations support, $282 million for the BSM program, and $15 million for the
administration of the health insurance tax credit. The Administration has requested
the same amounts for each account.
The version of H.R. 2829 passed by the House lacked a notable provision that
was included in the version of the bill approved by the Appropriation Committee.
That provision would have limited funding in FY2008 for managing IRS’s private
tax debt collection program to $1 million, or $254 million less than the amount
requested by the Administration. Such a limitation would have effectively ended the
program, which has been embroiled in controversy since the IRS gained the authority
to hire private debt collectors in 2004. During the floor debate on the bill in the
House, Representative Jose Serrano, the Chairman of the House Appropriations
Subcommittee on Financial Services, agreed to drop the provision in the face of
opposition from some Republicans. Representative Jim McCreary raised a point of
order against the provision on the grounds that any measure capping funding for the
private tax debt collection program fell under the jurisdiction of the Ways and Means
Committee and thus should not be considered as part of an appropriations bill.33
While conceding the point of order, Representative Serrano disagreed that
eliminating the program would necessarily result in a loss of revenue.
Senate-Reported Version of H.R. 2829. The version of H.R. 2829
reported favorably by the Senate Appropriations Committee on July 12 would
provide $11.142 billion in appropriated funds for the IRS in FY2008 — or $46
million more than the amount requested by the Bush Administration but about $6
million less than the amount recommended by the House.
Of this amount, $2.149 billion would be used for taxpayer services (or $46
million more than the Administration’s budget request but $6 million less than the
House bill); $4.925 billion would go to enforcement (same as the Administration’s
budget request and the House bill); $3.770 billion would be set aside for operations
support (same as the Administration’s budget request and the House bill); $282
million would be channeled into the BSM (same as the Administration’s budget
request and the House bill); and $15 million would be spent on administering the
health insurance tax credit (same as the Administration’s request and the House bill).
In its report on H.R. 2829, the committee expressed a variety of concerns about
the IRS’s readiness to address several key issues. One was the tax gap. The gap is
the difference between federal taxes owed and federal taxes paid in a timely manner.
According to the latest estimate by IRS, the gross tax gap amounted to $345 billion
32 House Appropriations Committee, report to accompany H.R. 2829, p. 25.
33 Meg Shreve, “Private Debt Collection Survives Appropriation Process,” Tax Notes, July
2, 2007, p. 7.

CRS-16
in 2001. In the committee’s view, the IRS “must and can reduce the tax gap if the
IRS is given additional resources and is able to improve its operational capabilities
(most notably the Business Systems Modernization program).”34 Yet it could find
no strategy in the Administration’s budget request for the IRS in FY2008 that would
enable the agency to achieve the stated goal of raising the voluntary compliance rate
for all taxpayers from its estimated level of 83.7% in 2007 to 85% by 2009. So the
committee added a provision to H.R. 2829 requiring the IRS to develop such a plan,
without specifying a deadline.
Of the $2.149 billion recommended for taxpayer services in the bill, “not less
than” $3 million would be set aside for the tax counseling program for the elderly,
“not less than” $9 million for low-income taxpayer clinic grants, and “not less than”
$10 million to establish and administer a matching grant program for tax return
preparation assistance involving volunteers from local communities. On other
matters dealing with appropriations for taxpayer service, the committee directed the
IRS, after consulting with the IRS Oversight Board and the National Taxpayer
Advocate, to submit to Congress an annual update of its current five-year strategic
plan for taxpayer services known as the “Taxpayer Assistance Blueprint.” It also
expressed disappointment with the slow progress made by the IRS in increasing the
number of tax returns that are filed electronically and directed the agency to develop
a strategic plan to meet the 80% electronic filing goal it was supposed to reach by
2007. The plan must be submitted to the House and Senate Appropriations
Committees by March 1, 2008.
On matters related to appropriations for enforcement, the committee directs the
IRS to submit to the House and Senate Appropriations Committees by March 1, 2008
a “detailed research plan” to correct problems with its National Research Program
(NRP).35 The IRS uses data collected through the NRP to generate estimates of the
underreporting of taxable income by individual taxpayers, a major component of the
federal tax gap. But the IRS, Government Accountability Office, and TIGTA, among
others, have expressed concern about the quality of the data from the NRP and gaps
in its coverage. The committee also expressed concern about the loss of tax revenue
arising from the misclassification of workers as independent contractors and directed
the IRS to channel more enforcement resources into “industries where
misclassification is widespread.”36
A controversial provision of the bill would reduce funding to administer the
IRS’s private debt collection program from the requested level of $255 million to $1
million. At such a low level of funding, the IRS would be forced to suspend the
program. One noteworthy aspect of the provision is its wording. The version of H.R.
2829 reported by the House Appropriations Committee contained a similar provision,
but it was removed during the House floor debate after facing the threat of a budget
point of order tied to a ruling by the Joint Committee on Taxation that cutting
funding for the private tax debt collection program would result in a loss of revenue.
34 Senate Appropriations Committee, report to accompany H.R. 2829, p. 23.
35 Ibid., p. 27.
36 Ibid., p. 28.

CRS-17
To avoid a similar outcome, the Senate version is crafted so that the provision would
cut direct appropriations for the program but allow the program to fund itself through
the delinquent taxes collected as a result of it.37
Title II: Executive Office of the President and Funds
Appropriated to the President38
All but three offices in the Executive Office of the President (EOP) are funded
in the Financial Services and General Government (FSGG) appropriations bill.39
Table 4 shows enacted appropriations for FY2007, and, for FY2008, amounts
requested by the Administration, passed by the House and reported by the Senate.
Table 4. Executive Office of the President and Funds
Appropriated to the President, FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
House
Senate
Passed
Reported
FY2007
FY2008
(H.R.
(H.R.
FY2008
Office
Enacted
Request
2829)
2829)
Omnibus
The White House (total)
$172,993
$187,370
$177,089
$177,589
$176,505
Compensation of the
450
450
450
450
450
President
The White House Office
53,616
53,156
53,156
51,656
51,656
(salaries and expenses)
Executive Residence, White
12,398
12,814
12,814
12,814
12,814
House (operating expenses)
White House Repair and
1,683
1,600
1,600
1,600
1,600
Restoration
Council of Economic
4,032
4,118
4,118
4,118
4,118
Advisers
Office of Policy Development
3,487
3,482
3,482
3,482
3,482
Privacy and Civil Liberties



2,000
2,000
Oversight Board*
National Security Council
8,684
8,640
8,640
8,640
8,640
Office of Administration
88,643
103,110
92,829
92,829
91,745
Office of Management and
76,714
70,866
78,394
78,394
78,000
Budget
37 Dustin Stamper, “Senate Appropriators Take Another Stab at Private Debt Collection,”
Tax Notes, July 16, 2007, p. 162.
38 This section was written by Barbara Schwemle, Analyst in American National
Government, Government and Finance Division.
39 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.

CRS-18
Federal Drug Control Programs
464,447
473,368
460,436
464,887
421,702
(total)
Office of National Drug
26,766
23,883
26,636
25,152
26,402
Control Policy
High Intensity Drug
224,730
220,000
226,000
235,000
230,000
Trafficking Areas Program
Other Federal Drug Control
192,951
224,485
197,800
204,735
164,300
Programs
Counterdrug Technology
20,000
5,000
10,000

1,000
Assessment Center
Unanticipated Needs
990
1,000
1,000
1,000
1,000
Office of the Vice President
4,432
4,432
4,432
4,432
4,432
(salaries and expenses)
Official Residence of the Vice
322
320
320
320
320
President (operating expenses)
Total: EOP and Funds
$719,898
$737,356
$721,671
$726,622
$681,959
Appropriated to the President
Sources: Budget authority tables provided by House Appropriations Subcommittee on Financial
Services and General Government, President’s FY2008 budget request, U.S. Executive Office of the
President, Fiscal Year 2008 Congressional Budget Submission (Washington: February 2007), and
S.Rept. 110-129. Columns may not equal the total due to rounding.
*The FY2007 law, the FY2008 budget request, and the FY2008 House-passed bill included the
appropriation for the Privacy and Civil Liberties Oversight Board under the White House Office
account and provided funding of $1.5 million. Section 801(a) of P.L. 110-53, Implementing
Recommendations of the 9/11 Commission Act of 2007, enacted on August 3, 2007, authorizes
appropriations for the Board as follows: $5,000,000 (FY2008); $6,650,000 (FY2009);
$8,300,000 (FY2010); $10,000,000 (FY2011); and such sums as may be necessary (FY2012
and each subsequent fiscal year).
The Executive Office of the President Budget and Key Issues
The Administration’s FY2008 budget requested 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 request, funding
for all “White House” 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 proposed 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 continued to include the HIDTAP appropriation under the
EOP, but at a level that is 2.1% less than the program’s FY2007 funding. Under
federal drug control as well, significant changes in funding were 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%.

CRS-19
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
! Council of Economic Advisers.40
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.”41 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.42 H.R. 2829, as passed by the House
and reported in the Senate, continues with separate appropriations for the EOP
accounts.
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:
40 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.)
41 U.S. Executive Office of the President, Fiscal Year 2008 Congressional Budget
Submission
(Washington: February 2007), p. EOP-14. (Hereafter cited as EOP Budget
Submission
.)
42 P.L. 110-5, February 15, 2007,121 Stat. 8.

CRS-20
! The White House,43
! 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
! Office of the United States Trade Representative.44
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.”45
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. Section 201 of H.R. 2829, as passed by the House
and reported in the Senate, continues the current practice.
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
43 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.
44 FY2008 Budget, Appendix, p. 964.
45 EOP Budget Submission, p. EOP-15.

CRS-21
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.46
House-Passed Bill.47 H.R. 2829, as passed by the House, provides
appropriations for the accounts under the EOP and funds appropriated to the
President at the levels requested by the President’s budget except for the OA, OMB,
and the various federal drug control accounts. The House Committee on
Appropriations report that accompanies the bill states that the reduction of $10.3
million in the OA appropriation results from keeping the rental payments to GSA for
OMB ($7.5 million) and ONDCP ($2.8 million) under the salaries and expenses
accounts for these entities. The report notes that “all miscellaneous costs in the
Enterprise Services Program” are provided as requested.
The restoration of the $7.5 million to OMB salaries and expenses for the rental
payments to GSA accounts for the increase in the agency’s appropriation. The
committee report expresses continued concern about OMB using the E-Government
initiative “to force its management priorities on agencies that would otherwise
choose different approaches to serving the public and other government agencies that
are better tailored to meet the needs of their customers and meet their statutory
requirements.” It notes the continuation of the government-wide general provision
at Section 737 that prohibits the use of funds for E-Government without prior
consultation and approval by the committee and urges OMB and the agencies “to
work directly with the individual appropriations subcommittees in advance of
recommending e-Government transfers so that approved worthy initiatives can move
forward without disruption.” The report also directs OMB to report to the committee
within 180 days of the act’s enactment on the implementation and effectiveness of
OMB’s guidance to the agencies on reducing fraud and abuse in the federal transit
benefit program.
The restoration of the $2.8 million to ONDCP salaries and expenses for the
rental payments to GSA accounts for the increase in the agency’s appropriation.
Included in the House report are directives that ONDCP report to the committee
within 90 days of the act’s enactment on the aerial eradication program in Columbia
and on the update of the November 2004 report listing illicit drug prices and purity.
Section 202 of H.R. 2829, as passed by the House, requires the President to submit
a financial plan to the House and Senate Committees on Appropriations within 30
days of this act’s enactment and prior to the initial obligation of ONDCP funds for
FY2008. The plan must be updated every six months and new projects and changes
in funding for ongoing projects would be subject to prior approval by the
46 EOP Budget Submission, pp. EOP-16 - EOP-17.
47 On June 26, 2007, OMB issued a Statement of Administration Policy on H.R. 2829 that
urged the House of Representatives to adopt the President’s proposals on consolidation,
transfer authority, and Enterprise Services and his request for full funding for the National
Youth Anti-Drug Media Campaign. (pp. 3-4.)

CRS-22
Appropriations Committees. HIDTAP receives an appropriation which is $6 million
above the President’s request. The committee report specifies that the HIDTAs for
FY2008 “receive funding at least equal” to their FY2007 “initial allocation level” and
that not less than $2.1 million be used for auditing services and related activities.
The appropriation for the other federal drug control programs account is $26.7
million below the President’s budget request. According to the committee report,
increased funding cannot be justified for the National Youth Anti-Drug Media
Campaign because an ONDCP study and a GAO review found that “there is no clear
evidence that the campaign has resulted in a reduction in drug use among youth.” The
report directs ONDCP to provide recommendations to the committee within 90 days
of the act’s enactment “on the development of improved and meaningful
measurements of the effectiveness of the media campaign, including [those] that
would indicate how the campaign influences youth and parent behavior.” The $197.8
million appropriation for the other federal drug control programs is allocated as
follows:
Drug Free Communities — $90 million
Training and technical assistance for drug court professionals — $1 million
Model Acts — $1 million
Demonstration programs for chronic hard-drug users under community
supervision — $1 million
National Youth Anti-Drug Media Campaign — $93 million
United States Anti-Doping Agency — $9.6 million
World Anti-Doping Agency Dues — $1.7 million
Performance Measures Development — $500,000
The $5 million increase in the appropriation for the CTAC results from the
restoration of funding to the Technology Transfer Program which the President’s
budget had proposed to be terminated.48 Established in 1990 and reauthorized in
1998, the CTAC is to serve as the central counterdrug technology research and
development organization for the United States Government.
The House committee report also addresses two issues under the White House
Office account. First, the report notes that the “account had unobligated balances of
budget authority in excess of $6,500,000, or more than 10 percent of its
appropriation, remaining at the end of fiscal years 2005 and 2006” and states the
expectation that the committee will “be kept fully informed of the reasons for any
significant differences between actual and budgeted spending.” The report expresses
the committee’s concern about the Administration’s extensive editing of the first
report to Congress by the Privacy and Civil Liberties Oversight Board and states “that
the Board must have the authority and independence to thoroughly review, assess,
and report accurately on privacy and civil liberties matters.” The House-passed bill
provides an appropriation of $1.5 million for the Board.49
48 H.Rept. 110-207, pp. 36-40.
49 Ibid., p. 33.

CRS-23
Senate-Reported Bill. H.R. 2829, as reported in the Senate, provides
appropriations for the accounts under the EOP and funds appropriated to the
President at the levels requested by the President’s budget except for the WHO, OA,
OMB, and the various federal drug control accounts. Unlike the President’s budget
request, which included funding for the Privacy and Civil Liberties Oversight Board
within the WHO account, the Senate Committee on Appropriations report states that
funding for the board is provided in a separate account that is funded at $2 million.
The committee directs the EOP to include detailed budget information for the board
in the FY2009 budget justification and expects the board’s annual report “to
specifically detail how the additional funds provided have benefited” its work and
responsibilities.50 The reasons for the reduction in the OA appropriation and the
increases in the OMB and ONDCP appropriations are the same as for the House-
passed bill. The Senate committee directs the OMB Director to report to Congress
by March 1, 2009, on “the extent to which executive departments and agencies that
administer directed funding allocate the designated amounts to intended recipients
at a level less than the amount specified in any enacted bill or accompanying report
describing such directed funding.”51
ONDCP’s appropriation of $25.2 million includes the restoration of the $2.8
million to ONDCP salaries and expenses for the rental payments to GSA. It also
includes $1.5 million for “an independent study and analysis of ONDCP’s
organization and management” to be conducted by the National Academy of Public
Administration (NAPA).52 The office must contract with NAPA for the study within
two months after the act’s enactment. Like the House-passed bill, H.R. 2829, as
reported in the Senate, includes the Section 202 provision on submission of a
financial plan prior to the obligation of ONDCP funds. In addition, the Senate
version of the bill includes provisions at Sections 203, 204, and 205 that are not
included in the House-passed bill. These provisions relate to transfer authority,
reprogramming, and budget estimates for ONDCP. According to the Senate report,
the committee does not agree with the office’s proposal to reorganize 3 of its 12
components. Among the directives included in the Senate report are requirements
that the ONDCP Director submit to the House and Senate Committee on
Appropriations “quarterly reports on travel expenditures, summarized by office,
program, and individual, including dates and purpose of travel” and “quarterly
reports on current staffing levels and plans for future hirings ... includ[ing] office,
position title, salary, and job classifications of all persons employed by ONDCP,
including contractors.”53
The appropriation for HIDTAP is $15 million more than the President
requested. The committee report includes language similar to that in the House
committee report on the funding for existing HIDTAs and directs the ONDCP
Director “to ensure that the HIDTA funds are transferred to the appropriate drug
50 S.Rept. 110-129, pp. 35, 38.
51 Ibid., p. 39.
52 H.R. 2829, as reported in the Senate, p. 174.
53 S.Rept. 110-129, p. 41.

CRS-24
control agencies expeditiously.” Further, the committee report includes specific
directions on the allocation and use of HIDTA funds:
[T]he committee expects the Director of ONDCP to ensure that the entities
receiving these limited resources make use of them strictly for implementing the
strategy for each HIDTA, taking into consideration local conditions and resource
requirements.
The HIDTA funds should not be used to supplant existing support for ongoing
Federal, State, or local drug control operations normally funded out of the
operating budgets of each agency. ONDCP is directed to hold back all HIDTA
funds from a State until such time as a State or locality has met its financial
obligation.54
The other federal drug control programs account is funded at $204.7 million,
$19.8 million less than the President’s request. Stating views similar to those
expressed in the House committee report, the Senate report reflects the committee’s
concern “about the direction and efficacy” of the National Youth Anti-Drug Media
Campaign. The appropriation for other federal drug control programs is allocated as
follows:
Drug Free Communities — $90 million
Training and technical assistance for drug court professionals — $1 million
Model Acts — $1.5 million
National Youth Anti-Drug Media Campaign — $100 million
United States Anti-Doping Agency — $10.3 million
World Anti-Doping Agency Dues — $1.7 million
Performance Measures Development — $250,00055
H.R. 2829, as reported in the Senate, does not provide funding for the CTAC.
The committee report states that “Funding from previous years has remained
unexpended despite congressional direction to reinstate CTAC programs as
previously existed, and congressional intent with regard to this program has been
ignored.” It also states that the “committee is highly disappointed in the director of
this program and is troubled by his ideas for research and development that appear
to have little or no value.” The unexpended balances in the account, according to the
committee, are “adequate” to fund the program in FY2008.56
With regard to the appropriation for the Official Residence of the Vice
President, the Senate report states the committee’s expectation that it “be kept fully
apprised by the Vice President’s office of any and all renovations and alterations
made to the residence by the Navy.”57
54 Ibid., p. 43.
55 Ibid., p. 44.
56 Ibid., p. 42.
57 Ibid., p. 47.

CRS-25
The Senate version of H.R. 2829, as marked up by the Senate Subcommittee on
Financial Services and General Government on July 10, 2007, included a provision
to reduce the funding for the Office of the Vice President unless the office complied
with Executive Order 12958 on Classified National Security Information.58 The Vice
President’s Office had sought to be exempted from the executive order.59 During
markup of the bill on July 12, 2007, the Senate Committee on Appropriations agreed
by a 15-14 vote to an amendment offered by Senator Sam Brownback to strike the
provision from the bill. The amendment also expressed “the Sense of the Senate that
the President should amend Executive Order 12958 to be consistent with the letter
from his Counsel dated July 12, 2007” which stated that the Office of the Vice
President is exempt from the executive order.60
Title III: The Judiciary61
As a co-equal branch of government, the judiciary presents its budget to the
President, who transmits it to Congress unaltered. Table 5 shows appropriations for
the judiciary as enacted for FY2007, and, for FY2008, amounts requested by the
Administration, passed by the House, and reported by the Senate.
Table 5. The Judiciary Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
House
Senate
Passed
Reported
FY2007
FY2008
(H.R.
(H.R.
FY2008
Budget Groupings and Accounts
Enacted
Request
2829)
2829)
Omnibus
Supreme Court (total)
$74.0
$78.7
$78.7
$78.7
$78.7
Salaries and Expenses
62.6
66.5
66.5
66.5
66.5
Building and Grounds
11.4
12.2
12.2
12.2
12.2
58 An amendment offered by Senator Sam Brownback to strike this provision from the bill
failed by a 4-5 vote on July 10, 2007. During the House debate on H.R. 2829 on June 28,
2007, Representative Rahm Emanuel offered an amendment (H.Amdt. 480) to include a
general provision in the bill, at Section 901, to prohibit the use of funds for the care,
operation, refurnishing, or improvement of the Vice President’s official residence and any
expenses of the Vice President. The amendment failed by a 209-217 (Roll No. 596) vote.
See, Congressional Record, vol. 153, June 28, 2007, pp. H7365-H7369 and H7402-H7403.
59 See, William Douglas, “Waxman Blasts Cheney’s Refusal to Comply With Order,” Knight
Ridder Tribune News Service
, June 21, 2007, p. 1, and Michael Abramowitz, “Cheney Aide
Explains Stance on Classified Material,” Washington Post, June 27, 2007, p. A5. The June
26, 2007, letter from David S. Addington, Chief of Staff, to Senator John Kerry, referred to
i n
T h e W a s h i n g t o n P o s t a r t i c l e i s a v a i l a b l e a t
[http://www.fas.org/sgp/news/2007/06/ovp062607.pdf].
60 H.R. 2829, as reported in the Senate, p. 178.
61 This section was written by Lorraine Tong, Analyst in American National Government,
Government and Finance Division.

CRS-26
FY2008
FY2008
House
Senate
Passed
Reported
FY2007
FY2008
(H.R.
(H.R.
FY2008
Budget Groupings and Accounts
Enacted
Request
2829)
2829)
Omnibus
U.S. Court of Appeals for the Federal
25.3
28.6
28.0
27.4
27.1
Circuit
U.S. Court of International Trade
15.8
16.7
16.5
16.6
16.6
Courts of Appeals, District Courts, and
5,696.4
6,202.5
5,954.0
6,030.5
5,942.5
Other Judicial Services (total)
Salaries and Expenses
4,476.6
4,854.5
4,660.6
4,710.0
4,619.3
Court Security
378.7
421.8
396.5
412.7
410.0
Defender Services
776.3
859.8
830.5
840.6
835.6
Fees of Jurors and
60.9
62.4
62.4
63.1
63.1
Commissioners
Vaccine Injury Compensation
4.0
4.1
4.1
4.1
4.1
Trust Fund
Administrative Office of the U.S.
72.4
78.5
75.7
78.5
76.0
Courts
Federal Judicial Center
22.9
24.8
24.0
24.5
24.2
United States Sentencing Commission
14.6
16.2
15.5
15.5
15.5
Judicial Retirement Funds
58.3
65.4
65.4
65.4
65.4
Total: The Judiciary
$5,979.7
$6,511.5
$6,257.8
$6,337.2
$6,246.1
Sources: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government, and S.Rept. 110-129. Columns may not equal total due to
rounding.
Note: The Administrative Office of the U.S. Courts revised the judiciary’s original FY2008 budget
request estimate on March 21, 2007, from the total of $6.51 billion to $6.43 billion.
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 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

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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 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
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).62
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,63 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.”64
62 Administrative Office of the U.S. Courts, The Judiciary Fiscal Year 2008 Congressional
Budget Summary
(Washington: February 2007), pp. 33-34. Hereafter cited as Judiciary
FY2008 Congressional Budget Summary
.
63 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.
64 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,
(continued...)

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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
(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.65
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 Senate and House Judiciary Committees introduced companion bills (S.
378 and H.R. 660, respectively), the Court Security Improvement Act of 2007, to
strengthen security.66 The Senate Judiciary Committee approved S. 378 on March
1, 2007 (following a February 2007 hearing on judicial security and independence),
and reported the bill on March 29, 2007. On April 19, 2007, the Senate passed
S. 378 unanimously. After the House Subcommittee on Crime, Terrorism, and
Homeland Security held a hearing, the House Judiciary Committee amended H.R.
660 on June 13, 2007, and reported the bill on July 10, 2007. On that same day,
under suspension of the rules, the House approved H.R. 660 by voice vote. As
passed in their respective chambers, the Senate and House bills in their key
provisions are essentially the same, but differ in a few areas. 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. As of October 26, 2007, installations of alarm systems have been
completed in 97% of the homes of federal judges who have requested them.67
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, as well as FPS billing problems. On March 13, 2007, the Judicial
64 (...continued)
March 21, 2007, p. 2. Hereafter cited as Judge Gibbons’s March 21, 2007, Statement.
65 Ibid., pp. 3-4.
66 For more details about legislative proposals to enhance judicial security, including S. 378
and H.R. 660, see CRS Report RL33464, Judicial Security: Responsibilities and Current
Issues
, by Lorraine H. Tong.
67 U.S. Marshals Service, Office of Congressional Affairs, provided the information to the
author on October 26, 2007.

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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.68
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 113,697 people under supervision, with
a projected increase to 114,600 in 2007.69
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.70
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.”71 On June 15,
2007, Senator Patrick J. Leahy, Chairman of the Senate Judiciary Committee,
introduced S. 1638, the “Federal Judicial Salary Restoration Act of 2007” to provide
a 50% pay adjustment for justices and judges. S. 1638 was referred to the Senate
Judiciary Committee, where it is pending. Representative John Conyers Jr.,
Chairman of the House Judiciary Committee, introduced a companion bill, H.R.
3753, “Federal Judicial Salary Restoration Act of 2007,” on October 4, 2007. The
68 Judge Gibbons’s March 21, 2007, Statement, pp. 9-10.
69 Ibid., pp. 4-5.
70 U.S. Courts, News Release, “Federal Judiciary Says New Judgeships Needed,” March
13, 2007, at [http://www.uscourts.gov/Press_Releases/judconf031307.html].
71 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].

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House bill would provide for a 41.3% pay adjustment to justices and judges. H.R.
3753 was referred to the House Judiciary Committee, where it is pending. Both bills
would authorize appropriations for sums necessary to carry out the act.
Earlier in the year, on January 8, 2007, Senator Leahy also introduced S. 197,
legislation to authorize a 1.7% salary increase for federal justices and judges for
FY2007. The Senate approved S. 197 by unanimous consent on the same day, and
the bill was referred to the House Judiciary Committee. On February 2, 2007, S. 197
was referred to the Subcommittee on Courts, the Internet, and Intellectual Property,
where it is pending.72
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.
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 and Congressional Action.73 For FY2008, the judiciary
requested $6.51 billion in total appropriations, an 8.9% increase over the $5.98
billion enacted for FY2007.74 According to the judiciary, about 82% of the increase
72 For further information on these bills and judicial pay issues, see CRS Report RL34281,
Judiciary Salary: Current Issues and Options for Congress, by Kevin M. Scott; and also CRS
Report RS20388, Salary Linkage: Members of Congress and Certain Federal Executive and
Judicial Officials
, and CRS Report RL33245, Legislative, Executive, and Judicial Officials:
Process for Adjusting Pay and Current Salaries
, both by Barbara L. Schwemle.
73 Administrative Office of the U.S. Courts, The Judiciary Fiscal Year 2008 Congressional
Budget Summary
(Washington: February 2007). Hereafter cited as Judiciary FY2008
Congressional Budget Summary
.
74 The judiciary revised its request on March 21, 2007, reducing the original budget request
(continued...)

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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)75 positions — an increase of 2.1% over the estimated 32,972
FTEs for FY2007.
The House-passed bill would provide $6.26 billion for the judiciary — a $278.1
million increase over the FY2007 enacted amount, but $253.7 million below the
FY2008 request.76 The Senate committee recommended $6.34 billion for the
judiciary, or $79.4 million above the House-passed level for FY2008.
In report language, the House committee expressed its expectation (as it has in
previous years), that the judiciary will submit a financial plan allocating all sources
of available funds, including appropriations, fee collections, and carry-over balances,
within 90 days of enactment of the appropriations act. The plan would serve as the
baseline for determining if reprogramming notification is required. The committee
also expressed interest in increasing the number of minorities in clerkship positions
and encouraged the judiciary to explore ways to increase outreach to minority law
students.77
The Senate committee, in report language, reminded the judicial branch that it
is also “subject to the same funding constraints facing the executive and legislative
branches” and urged the judiciary to “devote its resources primarily to the retention
of staff.” In addition, the judiciary was “encouraged to contain controllable costs
such as travel, construction, and other non-essential expenses.”78
The following are highlights of the FY2008 judiciary budget request, House-
passed amounts and Senate committee-reported amounts:79
74 (...continued)
from $6.51 billion to $6.43 billion, or an $80.2 million reduction ($79.7 million of this
amount is a decrease from the Salaries and Expenses account). (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.)
75 AOUSC provided a revised FY2008 request for 33,225 FTEs to the author on March 17,
2007.
76 The House-passed bill would provide $173.5 million below the revised budget request of
$6.43 billion that AOUSC submitted on March 21, 2007.
77 U.S. Congress, House Committee on Appropriations, Financial Services and General
Government Appropriations Bill, 2008
, report to accompany H.R. 2829, 110th Cong., 1st
sess., H.Rept. 110-207 (Washington: GPO, 2007), p. 42. Hereafter cited as H.Rept. 110-
207.
78 U.S. Congress, Senate Committee on Appropriations, Financial Services and General
Government Appropriations Bill, 2008
, report to accompany H.R. 2829, 110th Cong., 1st
sess., S.Rept. 110-129 (Washington: GPO, 2007), pp. 48. Hereafter cited as S.Rept. 110-
129.
79 Data are rounded, which may result in slight differences when figures are added or
subtracted.

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Supreme Court. For FY2008, the total request for the Supreme Court
(salaries and expenses plus buildings and grounds) was $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 was 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 was 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 would fund increases in salary and benefit
costs, and inflationary fixed costs. An additional six FTE were requested. The
House approved the full amount requested for this account. The Senate committee
recommended $66.5 million80 (or $4,000 less than the House amount) for the Salaries
and Expenses account, but the Senate also approved the full amount requested for the
Care of Buildings and Grounds account.
Language in the House committee report directed the Supreme Court to include
in its budget justification materials an annual report providing information on
technology carry-over balances, descriptions of each expenditure made in the
previous fiscal year, and the planned expenditures in the budget year. The House
committee also expressed its expectation to be informed of any changes to the scope
and projected completion date of the Supreme Court’s building modernization
project, and it provided that funds in the Care of Buildings and Grounds account
remain available until expended.81 The Senate report language also directed the
Court to report to the Senate committee the Court’s construction plans and any
changes in construction schedules or budgetary requirements as the Court becomes
aware of such changes.82
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 was $28.5 million — a $3.2 million (12.7%) increase over the $25.3 million
appropriated for FY2007. The House approved $28.0 million, a $2.7 million
increase over the FY2007 enacted amount, but $0.6 million below the request for this
account. The Senate committee recommended $27.4 million, or $0.5 million less
than the House-passed amount.
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
was $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. The House approved $16.5 million, a $0.7 million increase over
the FY2007 enacted amount, but $0.2 million below the request. The Senate
80 According to S.Rept. 110-129 (p. 49), this amount reflects the judiciary’s re-estimate of
its FY2008 requirements.
81 H.Rept. 110-207, p. 43.
82 S.Rept. 110-129, p. 49.

CRS-33
committee recommended $16.6 million for this account, or $0.09 million less than
the House level.
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. For this
budget group, the FY2008 request was $6,202.5 million, a $506.1 million increase
over the FY2007 enacted amount of $5,696.4 million. The House approved $5,954.1
million, an increase of $257.6 million over the FY2007 enacted amount, but $248.5
million below the request.83 The Senate committee recommended $6,030.5 million,
or $76.5 million above the House-passed amount.
In report language, the Senate committee addressed the issue of judicial rent and
space needs, acknowledging the efforts that the judiciary and GSA have made to deal
with the rent issue. The committee also encouraged the Judicial Conference to
ensure that “checks and balances are in place so that future construction requests and
projects are subject to highest standards of cost-efficiency.” The committee further
directed the Administrative Office of the U.S. Courts (AOUSC) to report to the
committee, no later than 120 days after enactment of the bill, on steps that have been
taken, and are being taken, to achieve more efficient use of space by district and
circuit courts. In addition, the AOUSC was directed to “ensure that current and
projected funding needs are met first with carryover funds before enhancing any
program.” The AOUSC was further directed to separately include in future financial
plans (for approval by the House and Senate Committees on Appropriations) “all
sources of carryover funds and their desired application.”84
The total of this budget group comprises the following accounts:
Salaries and Expenses. The FY2008 request for this account was $4,854.5
million, a $377.9 million increase over the FY2007 level of $4,476.6 million.
According to the budget request, this increase was needed for inflationary and other
adjustments to maintain the courts’ current services. The House approved $4,660.6
million, a $184.0 million increase over the FY2007 enacted amount, but $193.9
million below the request. The Senate committee recommended $4,710.0 million,
or $49.4 million above the House-passed amount.
83 On June 27, 2007, during House floor consideration of the bill, an amendment (H.Amdt.
455) was introduced — but withdrawn by unanimous consent — to increase funding for the
Court of Appeals, District Courts, and Other Judicial Services account by $10 million. The
amendment also would have decreased by the same amount of funding for the District of
Columbia courts (which is funded under this bill, but not under Title III, the judiciary
account). The intent of the amendment was to increase funding to alleviate the strain of the
workload and backlog of cases for the district courts along the U.S.-Mexican border.
84 S.Rept. 110-129, pp. 51-52.

CRS-34
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 (USMS) for
administering the Judicial Facility Security Program to pay for court security officers.
The FY2008 request was $421.8 million — a $43.1 million (11.4%) increase over
the FY2007 appropriation of $378.7 million. This increase was reportedly driven by
pay and benefit adjustments and other adjustments needed to maintain current
services. Payment to the Federal Protective Service (FPS) is also covered under this
account; $74.6 million requested would be an increase of $6.7 million (10%) over the
FY2007 appropriation of $67.9 million. The House approved $396.5 million, a
$17.8 million increase over the FY2007 enacted amount, but $25.3 million below the
request. The Senate committee recommended $412.7 million,85 or about $16.2
million above the House-passed amount.
The House committee recommendation, as approved by the House, provided for
inflationary increases, 52 additional court security officers, as well as court security
officers and screening equipment at probation and pretrial service offices in leased
facilities. Up to $15 million for this account is to remain available until expended.
In report language, the House committee expressed concern with “the quality of
service” the FPS has provided the judiciary, and encouraged the judiciary to
“continue to explore options with other Federal law enforcement agencies that might
be able to provide these security services.”86
In report language, the Senate committee expressed its expectation that USMS
will fully cooperate as the judiciary conducts fiduciary and program oversight
responsibilities for the Judicial Facility Security Funding.87 The Senate bill also
includes Section 307, which calls on the director of USMS to consult with the
director of AOUSC to designate certain courthouses for a pilot program under which
the USMS — rather than the Department of Homeland Security (FPS) — will
provide building-specific security services. The AOUSC would reimburse the USMS
for these services under the pilot.
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 was $859.8 million — an $83.5 million (10.8 %) increase over
the FY2007 appropriation of $776.3 million. The House approved $830.5 million,
a $54.2 million increase over the FY2007 enacted amount, or $29.3 million below
the request. The Senate committee recommended $840.6 million, or $10.1 million
above the House-passed amount.
85 According to S.Rept. 110-129 (p. 54), this amount is $2.0 million below the judiciary’s
re-estimate of FY2008 requirements.
86 H.Rept. 110-207, p. 45.
87 S.Rept. 110-129, p. 54.

CRS-35
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 was $62.4 million — a $1.5 million (2.3%)
increase over the FY2007 appropriation of $60.9 million. The increase in the request
was due mainly to inflationary costs associated with expenses paid to jurors. The
House approved the full amount requested. The Senate committee recommended
$63.1 million,88 or $0.7 million above the request.
Vaccine injury Compensation Trust Fund. Established to address a
perceived crisis in vaccine tort liability claims, the Vaccine Injury Compensation
Program is a federal no-fault program that protects the availability of vaccines in the
nation. The FY2008 request for this account was $4.1 million, a slight increase of
$0.15 million above the FY2007 enacted amount of $3.95 million. Both the House
and the Senate committees recommended the requested amount.
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 was $78.5 million — a $6.1 million (8.5%) increase
over the FY2007 level of $72.4 million. The increase was reportedly for pay
increases and other inflationary adjustments and for the anticipated reduction in non-
appropriated funds. The AOUSC also receives non-appropriated funds from fee
collections and carry-over balances to supplement its appropriations requirements.
The House approved $75.7 million, a $3.3 million increase over the FY2007 enacted
amount, but $2.9 million below the request. The Senate committee recommended
the full amount requested, or $2.9 million above the House-passed amount.
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
FY2008 request was $24.8 million — a $1.9 million (8.6%) increase over the
FY2007 appropriation of $22.9 million. The House approved $24.0 million, a $1.1
million increase over the FY2007 enacted amount, but $0.8 million below the
request. The Senate committee recommended $24.5 million, or $0.5 million above
the House-passed amount.
United States Sentencing Commission. The commission promulgates
sentencing policies, practices, and guidelines for the federal criminal justice system.
The FY2008 request was $16.2 million — a $1.6 million (10.9%) increase over the
FY2007 appropriation of $14.6 million. The House approved $15.5 million, a $0.9
million increase over the FY2007 enacted amount, but $0.7 million below the
request. The Senate committee recommended the House-passed amount.
88 According to S.Rept. 110-129 (p. 53), this amount reflects the judiciary’s re-estimate of
its FY2008 requirements.

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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 was $65.4 million — a $7.1 million (12.2%)
increase over the FY2007 appropriation of $58.3 million. The House approved and
the Senate committee recommended the requested amount.
General Provision Changes. According to the budget request submission,
the judiciary proposed 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 proposed 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).89
Administrative Provisions. The House-passed bill approved the extension
of a temporary judgeship in the U.S. District Court for Northern District of Ohio in
Section 305. It also approved the following provisions (as in previous years):
Sec. 301: which permits funding for salaries and expenses for the employment
of experts and consultant services as stipulated in law (5 U.S.C. 3109).
Sec. 302: which permits up to five percent of any appropriation made for
FY2008 to be transferred between judiciary appropriation accounts provided that
no appropriation shall be decreased by more than five percent or increased by
more than 10 percent by any such transfer except in certain circumstances. It
also provides that such transfers shall be treated as reprogramming of funds and
shall not be available for obligation or expenditure except in compliance with
procedures set forth in sections 605 and 610.
Sec. 303: which authorizes not to exceed $11,000 for official reception and
representation expenses incurred by the Judicial Conference of the United States.
Sec. 304: which requires a financial plan for the judiciary within 90 days of
enactment of the act.90
The Senate committee recommended Sections 301-304 above, and approved the
addition of the following provisions:
89 Judiciary FY2008 Congressional Budget Summary, p. 7.
90 H.Rept. 110-207, p. 47.

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Sec. 305: which provides for a salary adjustment for Justices and judges.
Sec. 306: which grants the judicial branch the same tenant alteration authorities as the
executive branch.
Sec. 307: which clarifies that the U. S. Marshals Service has the authority to provide
security services at several designated primary courthouses as part of a pilot program.
Sec. 308: which adds Vancouver, Washington as a place of holding court.91
Title IV: District of Columbia92
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).93 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 authority and empowered citizens of the District to elect a mayor and city
council. However, Congress retained the authority 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.94 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, the President’s FY2008 request, the amount
approved by the House of Representatives, and the amount recommended by the
Senate Appropriations Committee in the report accompanying H.R. 2829.
91 S.Rept. 110-129, p. 56.
92 This section was written by Eugene Boyd, Analyst in American National Government,
Government and Finance Division, and David Smole, Specialist in Education Policy,
Domestic Social Policy Division.
93 See Article I, Sec. 8, clause 17 of the U.S. Constitution and Section 446 of P.L. 93-198,
87 Stat. 801.
94 87 Stat. 801.

CRS-38
Table 6. District of Columbia Appropriations, FY2007 to FY2008:
Special Federal Payments
(in millions of dollars)
FY2008
FY2008
House
Senate
Passed
Reported
FY2007
FY2008
(H.R.
(H.R.
FY2008
Enacted
Request
2829)
2829)
Omnibus
Resident Tuition Support
$32.9
$35.1
$35.1
$33.0
$33.0
Emergency Planning and
8.5
3.0
3.4
3.4
3.4
Security
District of Columbia Courts
216.7
213.9
256.4
217.3
223.9
Defender Services
43.5
43.5
52.5
43.5
48.0
Court Services and Offender
Supervision Agency
179.6
190.3
190.3
190.8
190.3
Public Defender Service
31.1
32.7
32.7
32.7
32.7
Criminal Justice
Coordinating Council
1.3
1.3
1.3
1.3
1.3
Water and Sewer Authority
6.9
12.0
12.0
12.0
8.0
Anacostia Waterfront
3.0




Initiative
Transportation Assistance
1.0




Foster Care Improvements
2.0




CFO administered grants
20.0

6.1

5.5
Executive Office of the
Mayor



14.0
5.0
— Anacostia River Water
[5.0]
Quality Initiative
— Public Education
[2.2]
Initiative
— Marriage Initiative
[1.8]
— Pediatric Health Care
[1.0]
Initiative
— Historic Preservation
[1.0]
Education Improvements
39.6
40.8
40.8
40.8
40.8
— Public Schools
[12.8]
[13.0]
[13.0]
[13.0]
— Public Charter Schools
[12.8]
[13.0]
[13.0]
[13.0]
— Education Vouchers
[14.0]
[14.8]
[14.8]
[14.8]
Consolidated Laboratory
5.0
10.0
10.0
10.0
5.0
facilities

CRS-39
FY2008
FY2008
House
Senate
Passed
Reported
FY2007
FY2008
(H.R.
(H.R.
FY2008
Enacted
Request
2829)
2829)
Omnibus
Public Libraries

10.0
10.0
10.0
9.0
FBI Reimbursement

5.0
4.0
5.0
4.0
Special Federal Payments
$591.1
$597.6
$654.6
$613.7
$609.9
(total)
Sources: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government and S.Rept. 110-129. Columns may not equal the total due to
rounding.
The District of Columbia Budget and Key Issues
President’s Request. The Administration’s proposed FY2008 budget
includes $597.6 million in federal payments to the District of Columbia. 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 $75.9 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 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.

CRS-40
The bill, which was reported out of the House Subcommittee on the Federal
Workforce, the District of Columbia, and Postal Service on June 21, 2007, was
forwarded to the House Committee on Oversight and Government Reform. Though
the full Committee held a markup session on August 2, 2007, it postponed a vote to
report the measure out of committee.
H.R. 2829. The House-passed FSGG bill includes $654.6 million in special
federal payments for the District of Columbia. This is $63.6 million more than
appropriated in FY2007 and $57 million more than requested by the Administration
or the District for FY2008. Specifically, the House version of H.R. 2829,
recommends substantially increased funding for District of Columbia court
operations, defender services, and offender supervision than appropriated for FY2007
or requested by the Administration (See Table 6). In addition, the bill includes new
funds for enhancements to the public library system.
The Senate Appropriations Committee recommended an appropriation of $613.7
million in special federal payments for the District of Columbia, which is $40.9
million less than approved by the House, but $16.1 more than requested by the
Administration or the city. The Committee-passed bill deviates from its House
counterpart by recommending $39.1 million less in funding for court operations. The
Senate Committee-approved version of the bill, consistent with the FY2007 funding
level and the Administration’s request, recommends $43.5 million for defender
services, which is $9 million less than the $52.5 million recommended by the House.

The House and Senate versions of H.R. 2829 would eliminate funding for
transportation assistance and foster care, both of which were funded in FY2007.
Additionally, the House and Senate versions of H.R. 2829 would cut funding for
emergency planning and security activities from the current level of $8.5 million to
$3.4 million.
The House bill would reduce funding for earmarked grants administered by the
city’s Chief Financial Officer (CFO) to $6.1 million in FY2008, down from $20
million in FY2007. The Senate-reported bill does not include funding for the CFO
to administer such activities, but it would appropriate $14 million to the Executive
Office of the Mayor to fund environmental, education, health and financial
initiatives. Unlike the House version of the bill, which would eliminate funding for
an Anacostia River waterfront initiative, the Senate version of H.R. 2829 would
earmark $5 million of the $14 million that would be appropriated to the Executive
Office of Mayor to fund that initiative. Both bills would continue to fund resident
tuition support for postsecondary education and K-12 school improvement programs.
These education initiatives are further discussed below.
Resident Tuition Support. The District of Columbia Tuition Access Grant
(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 are either located
in the Washington, DC, metropolitan area, or are Historically Black Colleges and
Universities (HBCUs). The DCTAG program is authorized through FY2007; and
legislation (H.R. 1124 and S. 343) is being considered to extend it through FY2012.

CRS-41
Funding has been provided for the program annually beginning with FY2000. Under
H.R. 2829 as passed by the House, $35.1 million would be appropriated for the
DCTAG program, of which $1.2 million would be available for administrative
expenses. Under H.R. 2829 as reported in the Senate, $33.0 million would be
appropriated, of which 7% would be available for administrative expenses. Both
bills provide that awards made under the DCTAG program may be prioritized on the
basis of a resident’s academic merit, the need of eligible students, and other factors
as may be authorized.
School Improvement. H.R. 2829 as passed by the House, and H.R. 2829 as
reported in the Senate, would provide $40.8 million for school improvement
programs in the District of Columbia. Both bills would provide $13.0 million to the
District of Columbia Public Schools to support the improvement of public education;
and $13.0 million to the State Education Office to expand quality public charter
schools. Both bills would also provide $14.8 million to the Secretary of the U.S.
Department of Education for the operation of the D.C. Opportunity Scholarship
program, of which $1.8 million would be available to administer and fund
assessments.95 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 income does 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.
General Provisions. The House and Senate versions of H.R. 2829 include
language that would modify several general provisions included in previous
appropriations acts. Both bills would allow the use of District funds for a needle
exchange program aimed at reducing the spread of AIDS and HIV among users of
illegal drugs. This is a departure from previous appropriations acts which prohibited
the use of District and federal funds in support of a needle exchange program.
During House floor debate Representative Souder unsuccessfully offered two
amendments (H.Amdt. 465 and H.Amdt. 466) that would have prohibited the use of
federal and District funds for a needle exchange program.
Both the House-approved and Senate-reported bills would prohibit the city from
using federal funds to support or defeat legislation before the Congress or any state
legislature. The Senate bill includes additional language that would allow the
District to use local, but not federal, funds to support lobbying and advocacy efforts,
including those aimed at securing voting representation for the District in Congress.
95 There is a discrepancy between H.R. 2829 as reported in the Senate, and S.Rept. 110-129,
in the amount set aside for the D.C. Opportunity Scholarship program. H.R. 2829 as
reported in the Senate would set aside $14.0 million, of which $1.0 million would be
available to administer and fund assessments.

CRS-42
Both House-approved and Senate-reported versions of H.R. 2829 would leave
unchanged current prohibitions on the use of federal and District funds for abortion
services, except in instances where the life or health of the mother was in jeopardy,
and on the use of federal and District funds to regulate or decriminalize the use of
marijuana for medical purposes. The bills also would continue the $4,000 cap on
attorney fees in actions brought under the Individuals with Disabilities Education Act
(IDEA). The cap applies to both attorneys who represent parties in the actions, as
well as attorneys representing the District.
Continuing Resolution and D.C. Budget Autonomy. As signed by the
President on September 29, 2007, the continuing resolution (H.J.Res. 52, P.L. 110-
92) holds federal payments to the District of Columbia at their FY2007 rate until
November 16, 2007. However, Section 128 of the resolution releases the District’s
FY2008 general fund budget, which is financed with local revenues, from further
congressional review and approval.96 This action is consistent with a legislative
proposal (H.R. 733) that would allow the District to forgo congressional review and
approval of that portion of its operating and capital budgets financed with local
revenues. The city’s elected leaders have consistently asserted that Congress has
repeatedly delayed passage of the appropriations act for the District well beyond the
October 1 start of its fiscal year. City leaders contend that the delay in Congress’s
approval of the city’s budget hinders their ability to manage the District’s financial
affairs and negatively affects the delivery of public services.97
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, for FY2008, it
lists the amounts requested by the President, approved by the House, and reported by
the Senate, for each of the agencies.
96 Sec. 128 of H.J.Res. 52 states, “Notwithstanding any other provision of this joint
resolution, except section 106, the District of Columbia may expend local funds for
programs and activities under the heading District of Columbia Funds for such programs and
activities under title IV of H.R. 2829 (110th Congress), as passed by the House of
Representatives, at the rate set forth under District of Columbia Funds — Summary of
Expenses as included in the Fiscal Year 2008 Proposed Budget and Financial Plan submitted
to the Congress by the District of Columbia on June 7, 2007, as amended on June 29, 2007.”
97 For additional discussion of District of Columbia budget autonomy, see CRS Report
RL34032, District of Columbia Budget Autonomy: An Analysis of H.R. 733, 110th Congress,
by Eugene Boyd, Nonna Noto, and Jason Delaney.

CRS-43
Table 7. Independent Agencies Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
House
Senate
Passed
Reported
FY2007
FY2008
(H.R.
(H.R.
FY2008
Agency
Enacted
Request
2829)
2829)
Omnibus
Commodity Futures Trading
Commissiona



$116

Consumer Product Safety
63
63
67
70
80
Commission
Election Assistance Commission
16
15
316
17
142
Federal Communications
Commissionb
1
1
1
1
1
Federal Deposit Insurance
Corporation: Office of Inspector
(31)
(27)
(27)
(27)
(27)
General (by transfer)c
Federal Election Commission
55
59
59
59
59
Federal Labor Relations Authority
25
24
24
24
24
Federal Trade Commissionb
59
82
88
77
82
General Services Administrationd
-38
442
179
738
175

Merit Systems P
rotection Board
39
40
40
40
40



Morris K. Udall Foundation
4
1
4
6
6
National Archives and Records
331
369
388
396
400
Administration
National Credit Union
1
1
1
1
1
Administration
Office of Government Ethics
11
12
12
12
12
Office of Personnel Management
19,594
21,098
21,110
21,111
21,110
(total)
Salaries and Expenses
112
102
102
102
102
Government Payments for
Annuitants, Employees Health

8,780
8,884
8,884
8,884
8,884
Benefits
Government Payments for
Annuitants, Employee Life

39
41
41
41
41
Insurance
Payment to Civil Service
10,532
11,941
11,941
11,941
11,941
Retirement and Disability Fund
Office of Special Counsel
16
16
16
16
17
Securities and Exchange
Commissione
868
875
867
864
843
Selective Service System
25
22
22
22
22
Small Business Administration
572
464
582
568
569
United States Postal Service
109
89
89
118
118



United States Tax Court
48
45
45
45
45
Total: Independent Agencies
$21,797
$23,718
$23,911
$24,299e $23,746

CRS-44
Sources: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government, and S.Rept. 110-129. Columns may not equal the total due to
rounding.
a. The Commodity Futures Trading Commission (CFTC) is funded through the FSGG bill in the
Senate for FY2008, but in prior fiscal years it was funded through the agriculture and related
agencies appropriations bill. In the House, the CFTC remains part of the agriculture
appropriations bill (H.R. 3161) for FY2008.
b. The amounts listed in Table 7 for the FCC and the FTC only represent direct appropriations and do
not include fees collected by the agencies that are also used to fund agency activities.
c. 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.
d. Budget authority for GSA is calculated as the net value of appropriations, including limitations on
the availability of revenues, plus the redemption of debt payments, minus anticipated revenues
from rents paid into Federal Buildings Fund. In FY2007, anticipated revenues exceeded the sum
of appropriations plus redemption of debt payments, resulting in negative net obligational
authority.
e. The amounts listed in Table 7 for the SEC include fees collected by the agency. This is not
consistent with the treatment of fees for the FCC and the FTC, but it follows the source
documents for Table 7.
f. The amount listed in Table 7 for total FY2008 Senate funding of independent agencies includes
appropriations for the Commodity Futures Trading Commission (CFTC), which is funded in the
Senate bill but not the House bill. According to S.Rept. 110-129, the FY2007 enacted amount
for the CFTC was just under $98 million, and the President requested $116 million for the
agency for FY2008, which the Senate fully funded.
Commodity Futures Trading Commission (CFTC). The CFTC is the
independent regulatory agency charged with oversight of derivatives markets. The
CFTC’s functions include oversight of trading on the futures exchanges, registration
and supervision of futures industry personnel, prevention of fraud and price
manipulation, and investor protection. Although most futures trading is now related
to financial variables (interest rates, currency prices, and stock indexes),
congressional oversight remains vested in the agricultural committees because of the
market’s historical origins as an adjunct to agricultural trade.
For FY2008, the Administration has requested $116.0 million for the CFTC, an
increase of 18.4% over FY2007’s $98 million appropriation under the continuing
resolution. The Administration’s budget also proposed that a fee be imposed on
users of the futures market to pay for the cost of federal regulation. To fund the
CFTC at the $116 million level, a fee of about 5¢ per transaction on the futures
exchanges would be required. Every administration since Ronald Reagan’s has
proposed a similar fee, but Congress has never enacted one. (For more information
on the futures transaction fee, see CRS Report RS22415, Proposed Transaction Fee
on Futures Contracts
, by Mark Jickling.)
In the Senate, CFTC appropriations are included in H.R. 2829. As reported by
the Senate Appropriations Committee, the bill would provide $116.0 for the CFTC,
the amount requested by the Administration. The Senate bill does not include the
proposed transaction fee as a vehicle for funding the CFTC, but would provide for
an appropriation from the general fund.

CRS-45
In the House, CFTC appropriations are included in H.R. 3161, the Agriculture,
Rural Development, Food and Drug Administration, and Related Agencies
Appropriations Act of 2008. The House bill would provide $102.6 million for the
CFTC, $13.4 million, or 11.6%, less than the Administration’s request. Like the
Senate-reported bill, H.R. 3161 does not include the proposed transaction fee as a
vehicle for funding the CFTC, but would provide for an appropriation from the
general fund.

Consumer Product Safety Commission (CPSC).98 The CPSC is an
independent federal regulatory agency whose enabling legislation is the Consumer
Product Safety Act of 1972. The Commission’s primary responsibilities include
protecting the public against unreasonable risks of injury associated with consumer
products; developing uniform safety standards for consumer products and minimizing
conflicting state and local regulations; and promoting research and investigation into
the causes and prevention of product-related deaths, illnesses, and injuries.
For FY2008, the President’s budget call for providing CPSC with $63.25
million, just slightly more ($880,000) than its current funding level of $62.37
million. That figure ($62.37 million) is also the appropriation which the agency
received in FY2006 as well as the amount recommended for FY2007 by both the
House and Senate. The House passed the Committee on Appropriations
recommendation of $66.838 million, $3.588 million above the Administration’s
request. The Senate recommended $70 million for CPSC for FY2008.
Subsequently, however, widespread publicity about unsafe exports from China,
particularly dangerously defective toys, has prompted calls for substantially
increasing funding for the Commission.
Consumer groups and others continue to express concerns over the CPSC’s
staffing level, especially in light of recent news stories about unsafe exports (notably
including toys) from China. In 1977, three years after the Commission opened its
doors, it had a staff of 900. The staffing level has inexorably declined over the past
three decades. The budget for FY2007 culminated a two-year reduction of full-time
positions (FTEs) from 471 to 420. The Commission’s request for FY2008 would
require a decrease of an additional 19 FTEs.
Election Assistance Commission (EAC).99 The EAC provides grant
funding to the states to meet the requirements of the Help America Vote Act
(HAVA), provides for testing and certification of voting machines, studies election
issues, and promulgates voluntary guidelines for voting systems standards and issues
voluntary guidance with respect to the requirements in the act. The commission was
not given rule-making authority under HAVA, although the law transferred
responsibilities for the National Voter Registration Act from the Federal Election
Commission to the EAC, which included NVRA rule-making authority. The
Department of Justice is charged with enforcement responsibility.
98 This section was written by Bruce Mulock, Specialist in Business and Government
Relations, Government and Finance Division.
99 This section was written by Kevin Coleman, Analyst in American National Government,
Government and Finance Division.

CRS-46
As passed by the House, H.R. 2829 provides $316 million for the EAC. This
amount includes $300 million for election reform requirements payments, $15.5
million for salaries and expenses — with $3.25 million of that amount for the
National Institute of Standards and Technology (NIST) — and $950,000 for both the
Help America Vote College Program and the National Student and Parent Mock
Election Program. In the Senate, H.R. 2829, as reported by the Committee on
Appropriations, provides $16.5 million for the EAC, of which $3.25 million is for
NIST, and $1.1 million is for the college and mock election programs. The President
requested $15.46 million for FY2008, including $3.25 million for the NIST. For
FY2007, Congress appropriated $16.24 million for the EAC, of which $4.95 million
was for the National Institute of Standards and Technology, $4.83 million for
protection and advocacy programs, and $10.89 million for disability access.

Federal Communications Commission (FCC).100 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 House of Representatives approved a budget of $313 million
(a direct appropriation of $1 million and the remainder to be collected through
regulatory fees), $21.7 million above 2007 and the same as the President’s budget
request.101 Specifically, this budget would allow:
! up to $4,000 for official reception and representation expenses;
! purchase of uniforms and acquisition of vehicles;
! special counsel fees;
! collection of $312 million in Section 9 fees;
! the sum appropriated to be reduced as Section 9 fees are collected.
New provisions would also:
! prohibit fees collected in excess of $312 million from being
available for obligation;
100 This section was written by Patricia Moloney Figliola, Specialist in Internet and
Telecommunications Policy, Resources, Science, and Industry Division.
101 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).

CRS-47
! prohibit remaining offsetting collections from prior years from being
available for obligation;
! provides a $21 million transfer from the Universal Service Fund for
additional audits and oversight activities, including a direct
appropriation of $500,000;
! provides $2 million to educate the public regarding the transition to
digital television.
Finally, as in previous years, the budget as approved by the House would include a
provision limiting the funds available to administer the spectrum auctions program.
For FY2008, the Senate Committee on Appropriations has recommended a
budget of $313 million (a direct appropriation of $1 million and the remainder to be
collected through regulatory fees), the same as the House-approved budget.
The committee included language that would extend the FCC’s exemption from
the Anti-deficiency Act (ADA) until December 31, 2008. The committee stated in
its report that, “The ADA contains accounting rules which would derail the operation
of the FCC’s universal service electronic rate program. Requiring the FCC to adhere
to the ADA would result in the disruption of payments to schools and libraries for
broadband services” [sec. 501]. Additionally, the committee included language that
would prohibit the FCC from enacting certain recommendations regarding universal
service that were made to it by the Joint Board of FCC members and State Utility
Commissioners. The Joint Board’s recommendation would limit universal support
to one line, which the committee stated in its report “would be harmful to small
businesses, especially in rural areas, which need a second line for a fax or for other
business purposes” [sec. 502]. Further, it noted that it
continues to be concerned about the declining standards of broadcast television
and the impact this decline is having on America’s children. Overall sexual
content, foul language, and violence have greatly increased over the past decade.
The Committee directs the FCC to continue to report to Congress on the issues
associated with resurrecting a broadcast industry code of conduct for content of
programming that, if adhered to by the broadcast industry, would protect against
the further erosion of broadcasting standards.
Federal Deposit Insurance Corporation (FDIC): OIG.102 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 proposed, the House approved, and the Senate
Appropriations Committee recommended, a budget of $26.8 million for the OIG,
which is a 13% decrease from the FY2007 appropriation of $31 million.
102 This section was written by Pauline Smale, Economic Analyst, Government and Finance
Division.

CRS-48
Federal Election Commission (FEC).103 The FEC administers, and
enforces civil compliance with, the Federal Election Campaign Act (FECA)104
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.105 The agency did not request any additional staff
despite anticipated “[i]ncreased workloads associated with [2008] Presidential
elections.”106 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.107 The FEC also proposed legislative language that would allow the
agency to collect fees for educational conferences.108
The House-passed version of the FSGG would bill provide $59.2 million for
FY2008 — the same amount the agency requested and the House Appropriations
Committee recommended. The committee report did not contain particular
instructions for the FEC. Under a unanimous consent agreement regulating floor
consideration of the bill, amendments limiting presidential public campaign financing
could have been offered.109 However, the Legislative Information System and
Congressional Record show no record of those amendments actually being offered
on the floor. In fact, the FEC was the subject of limited discussion during FSGG
floor consideration. The version of the bill passed by the House specified minimum
and maximum levels of the appropriation to be used for FEC data automation and
“reception and representation” expenses.110
The FEC portion of the FSGG bill reported by the Senate Appropriations
Committee is identical to the language passed by the House. This includes the same
recommendation of $59.2 million in FEC funding and specified minimum and
maximum funding levels for data automation and reception and representation
103 This section was written by Sam Garrett, Analyst in American National Government,
Government and Finance Division.
104 2 U.S.C. §431 et seq.
105 See, for example, Federal Election Commission, Fiscal Year 2008 Performance Budget
for the Federal Election Commission
, Congressional Submission, February 5, 2007, at
[http://www.fec.gov/pages/budget/fy2008/fy2008cbj_final.pdf], pp. 2-3.
106 Ibid., p. 3.
107 Ibid., p. 2.
108 Ibid., p. 4.
109 See Honorable José Serrano. “Providing for Further Consideration of H.R. 2829,
Financial Services and General Government Appropriations Act, 2008.” Remarks in the
House. Congressional Record, daily edition, vol. 153 (June 27, 2007), p. H7296.
110 H.R. 2829 as passed by the House, Title V.

CRS-49
expenses.111 The report accompanying the bill did not contain specific instructions
for the FEC, but directed the Government Accountability Office (GAO) to report to
Congress on two campaign finance matters. First, the committee report directed
GAO to provide information on “the 10-year trend in the cost of House and Senate
campaigns as well as the percentage of those costs that are incurred due to rising
broadcast advertising rates.” Second, the report directed GAO to “revisit and update”
a previous report on public campaign financing in the states.112 Both issues were the
subject of a June 20, 2007, Senate Rules and Administration Committee hearing.113
Federal Trade Commission (FTC).114 The Federal Trade Commission
(Commission or FTC) 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 has requested a program level for the
FTC of $240.2 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 have been
derived from pre-merger filing fees, $19 million from Do-Not-Call fees, and the
remaining amount — $82.2 million — is to be provided by a direct appropriation.
Following the recommendation of the Appropriations Committee, the House
approved a total program level of $247.5 million for the FTC for FY2008, an
increase of $7.2 million over the Administration’s request. More specifically, $139
million is to come from pre-merger filing fees, $20 million from Do-Not-Call fees,
and a direct appropriation of $88.5 million. The comparable figures for the Senate-
reported version are: a total program level for the agency of $240.2 million (the same
as the Administration’s request), a figure comprising of $144.6 million from pre-
merger filing fees, $19 million from Do-Not-Call fees, and a direct appropriation of
$76.6 million.
For FY2007, the Administration had requested a program level of $223 million
for the FTC, an increase of slightly more than $13 million, or 6.2%, over FY2006
funding. The House-passed bill provided the FTC with $213 million for FY2007,
which was $3 million above the previous-year funding. For its part, the Senate
followed the recommendation of the Appropriations Committee, which set funding
for the agency for FY2007 at the $223 million level. Of the amounts provided, $129
111 H.R. 2829 as reported by the Senate Appropriations Committee, Title V.
112 On the committee report language, see U.S. Congress, Senate Committee on
Appropriations, Financial Services and General Government Appropriations Bill, 2008,
report to accompany H.R. 2829, 110th Cong., 1st sess., S.Rept. 110-129 (Washington: GPO,
2007), pp. 72-73. The GAO report is Campaign Finance Reform: Early Experiences of Two
States That Offer Full Public Funding for Political Candidates
, GAO-03-453, May 2003.
113 The Government Printing Office (GPO) website indicates that the committee print for
the hearing has not yet been released. For additional information about the hearing, public
financing in the states, and potential public financing of congressional campaigns, see CRS
Report RL33814, Public Financing of Congressional Elections: Background and Analysis,
by R. Sam Garrett.
114 This section was written by Bruce Mulock, Specialist in Business and Government
Relations, Government and Finance Division.

CRS-50
was to be derived from Hart-Scott-Rodino pre-merger filing fees and $18 million
from so-called Do-Not-Call fees (more formally known as the Telemarketing Sales
Rule, promulgated under the Telephone Consumer Fraud and Abuse Prevention Act).
The total amount of direct appropriations for FY2007 was therefore $76 million.
Appropriators, in recent years, have moved away from the practice followed at
the turn of the century (FY2000 through FY2002) wherein 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).115 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 indicated in Table 8, for FY2008, the President requested $144 million for
policy and operations, $47 million for the Office of Inspector General, $3 million for
allowances and office staff for former Presidents, and $18 million to be deposited
into the Federal Citizen Information Center Fund.
The House provided $135 million for GSA policy and operations, $53 million
for the Office of Inspector General, $3 million for allowances and office staff for
former Presidents, and $16 million to be deposited into the Federal Citizen
Information Center Fund.
The Senate Appropriations Committee recommended $65 million for
government-wide policy and $90 million for operating expenses, $53 million for the
Office of Inspector General, $3 million for allowances and office staff for former
Presidents, and $18 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 indicated in Table 8, for FY2008, the President requested that an additional
amount of $345 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 requested 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.
115 This section was written by Stephanie Smith, Analyst in American National Government,
Government and Finance Division.

CRS-51
The House provided that an additional amount of $88 million be deposited in
the FBF, and that the total limitation for the FBF be set at $7,835 million. The House
further provided that $525 million remain available until expended for new
construction projects from the FBF, and $733 million remain available until
expended for repairs and alterations.
The Senate Appropriations Committee recommended that an additional amount
of $625 million be deposited in the FBF, and that the total limitation for the FBF be
set at $8,371 million. The Senate bill further provided that $895 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
FY2008
House
Senate
Passed
Reported
FY2007
FY2008
(H.R.
(H.R.
FY2008
Fund/Office
Enacted
Request
2829)
2829)
Omnibus
Federal Buildings Fund (FBF)
Total Limitations on
Availability of Revenues
$7,555
$8,091
$7,835
$8,371
$7,830
(new obligational authority)
Limitations on Obligation:
701
615
525
895
531
New Construction Projects
Limitations on Obligation:
618
804
733
804
722
Repairs and Alterations
Limitation on Obligation:
Installment Acquisition

164
156
156
156
156
Payments
Limitation on Obligations:
4,068
4,383
4,316
4,383
4,315
Rental of Space
Limitation on Obligations:
Building Operations

2,004
2,132
2,105
2,132
2,105
Direct Appropriations
Federal Buildings Fund
$94
$344
$88
$625
$84
Electronic Govt (E-Gov)
3
5
3
5
3
Fund
General Activities (total)
206
212
207
229
207
Policy and Operations
0
144
135
0
0
Government-wide Policy
52
0
0
65
53
Operating Expenses
83
0
0
90
86

CRS-52
FY2008
FY2008
House
Senate
Passed
Reported
FY2007
FY2008
(H.R.
(H.R.
FY2008
Fund/Office
Enacted
Request
2829)
2829)
Omnibus
Office of Inspector General
53
47
53
53
48
Allowances and Office Staff
3
3
3
3
3
for Former Presidents
Federal Citizen Information
15
18
16
18
17
Center Fund
Direct Appropriations Total
$303
$561
$298
$859
$294
Sources: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government, S.Rept. 110-129. Columns may not equal the total due to rounding
Electronic Government Fund (E-Gov Fund).116 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, FY2006, and FY2007. 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 FY2008, but the House
approved $3 million, as recommended by the House Appropriations Committee.
Senate appropriators recommended $5 million, the requested amount.
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 shows
appropriations as enacted for FY2007, as requested for FY2008, as passed by the
House for FY2008, and as reported in the Senate for FY2008, for each of these
agencies.
116 This section was written by Harold Relyea, Analyst in American National Government,
Government and Finance Division.

CRS-53
Table 9. Independent Agencies Related to Personnel
Management Appropriations,
FY2007 to FY2008
(in millions of dollars)
FY2008
FY2008
House
Senate
Passed
Reported
FY2007
FY2008
(H.R.
(H.R.
FY2008
Agency
Enacted
Request
2829)
2829)
Omnibus
Federal Labor Relations
$25.4
$23.7
$23.6
$23.7
$23.6
Authority
Merit Systems Protection Board
38.7
40.1
40.1
40.1
40.1
(total)
Salaries and expenses
36.1
37.5
37.5
37.5
37.5
Limitation on administrative
2.6
2.6
2.6
2.6
2.6
expenses
Office of Personnel Management
19,593.8
21,097.7
21,109.7
21,111.8
21,110.3
(total)
Salaries and Expenses
111.6
101.8
101.8
101.8
101.8
Limitation on administrative
112.5
111.9
123.4
124.4
123.9
expenses
Office of Inspector General
2.1
1.5
1.5
1.5
1.5
(salaries and expenses)
Office of Inspector General
(limitation on administrative

16.3
16.5
17.0
17.1
17.1
expenses)
Government Payments for
Annuitants, Employees

8,780.3
8,884.0
8,884.0
8,884.0
8,884.0
Health Benefitsa
Government Payments for
Annuitants, Employee Life

39.0
41.0
41.0
41.0
41.0
Insurancea
Payment to Civil Service
Retirement and Disability

10,532.0
11,941.0
11,941.0
11,941.0
11,941.0
Funda
Office of Special Counsel
15.5
16.4
16.4
16.4
17.5
Sources: Budget authority table provided by House Appropriations Subcommittee on Financial
Services and General Government, S.Rept. 110-129, and the President’s FY2008 budget request.
Columns may not equal the total due to rounding.
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-54
Federal Labor Relations Authority (FLRA).117 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 also 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 proposed an appropriation of $23.7 million for
the FLRA, almost $1.7 million below the agency’s FY2007 appropriation of $25.4
million.118 The House recommended an appropriation of $23.6 million, which is
$77,000 below the President’s request. The amount proposed by the Senate
Appropriations Committee is the same as the Administration’s request of $23.7
million, and $77,000 more than the amount approved by the House.
Senator Daniel Akaka and Representative Danny Davis introduced the Federal
Labor-Management Partnership Act, S. 2197 and H.R. 3892, on October 18, 2007,
and it is pending in the Senate Committee on Homeland Security and Governmental
Affairs and the House Committee on Oversight and Government Reform. The
legislation would create a council to advise the President on labor-management
issues and to support the creation of labor-management partnerships. The FLRA
Director would serve on the council.
OPM has redesigned its Labor Agreement Information Retrieval System that
includes bargaining units certified by the FLRA and the complete texts of collective
bargaining agreements in the federal sector.119
Merit Systems Protection Board (MSPB).120 The President’s budget
requested, and H.R. 2829, as passed by the House and reported in the Senate, would
provide an FY2008 appropriation of just over $40 million for the MSPB. The
authorization for the agency expires on September 30, 2007. In its budget
117 This section was written by Gerald Mayer, Analyst in Public Finance, Domestic Social
Policy Division.
118 In its budget submission, the agency reported a decline of 32% in the workload at its
seven regional offices between 2001 and 2004, and anticipated that the trend may increase.
119 The system is available on the Internet at [http://lairs.opm.gov].
120 This section was written by Barbara Schwemle, Analyst in American National
Government, Government and Finance Division.

CRS-55
submission, MSPB projected a 2.4% increase in decisions issued for cases related to
retirement, adverse action appeals, and reduction-in-force appeals in FY2008. The
House committee report states that the funding to be provided to the agency covers
“mandatory pay raises, training, information technology improvements, and increased
rent payments.” According to the Senate committee report, the trust fund transfer
would provide “appropriate funding for MSPB to continue as arbitrator for the
additional appeals cases” from the Departments of Defense and Homeland
Security.121
Legislation that would reauthorize the MSPB for three years and includes
provisions to enhance the agency’s reporting requirements is currently pending in the
Senate and the House of Representatives. Senator Daniel Akaka and Representative
Danny Davis introduced the Federal Merit System Reauthorization Act of 2007, S.
2057 and H.R. 3551, on September 17, 2007, and it was referred to the Senate
Committee on Homeland Security and Governmental Affairs and the House
Committee on Oversight and Government Reform.
Office of Personnel Management (OPM).122 The President’s budget
requested, and H.R. 2829, as passed by the House and reported in the Senate,
provides an FY2008 appropriation of almost $102 million for salaries and expenses
for OPM. This amount includes funding of almost $6 million 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 stated 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 (e.g., Alaska and Hawaii) from non-foreign
cost of living allowances to locality pay.123
The House committee report notes that an increased amount ($1 million) is
authorized to be transferred from trust funds, $26.5 million of which is for retirement
systems modernization. The committee directs OPM to provide the committee with
quarterly reports on the program’s implementation beginning on January 31, 2008.
With regard to the Federal Human Capital Survey, the committee report directs OPM
to “continue to make agencies’ survey data publicly available in a consistent and
consolidated format, and in a timely manner.”
121 S.Rept. 110-129, p. 86.
122 This section was written by Barbara Schwemle, Analyst in American National
Government, Government and Finance Division.
123 FY2008 Budget Appendix, pp. 1080 (FLRA), 1091 (MSPB), 1115 (OSC), and 999, 1002,
and 1007 (OPM).

CRS-56
The committee report also urges OPM to work with the authorizing committees
“to consider changes in law to bring Federal prevailing rate [blue collar] employees
currently working in the Narragansett Bay, Rhode Island Wage Area within the
coverage of the Boston, Massachusetts Wage Area” and to report progress made on
this issue to Congress within 90 days of the act’s enactment. The report notes that
white-collar federal employees in Southeastern Massachusetts and Rhode Island are
included in the Boston Wage Area and that “[t]here is no reason for different
treatment between the two categories of employees.” According to the committee
report, the additional funding ($500,000) provided to the Office of Inspector General
(OIG) at OPM through trust fund transfer is intended “to maintain audit and
investigative staff at the current level and avoid deterioration of the OIG’s audit
capabilities.”
Several directives are included in the Senate committee report as follow:
! OPM must report to the committee within 120 days after the act’s
enactment “on its human resources products and services,” including
actions taken to address agency concerns about choice and
flexibility, and “indicating which products and services OPM has
identified as not reasonably available from private sector providers.”
Within the same time period, OMB must report to the committee
“on how the human resources products and services that OPM
provides to Federal agencies meet established standards, and on the
demonstrable steps OPM has taken to avoid any potential conflicts
between [its] role[s] as a human resources IT products and services
provider and ... the designated lead agency of the Human Resources
Line of Business.”
! OPM must work with and through the Chief Human Capital Officers
Council to ensure that the results of the survey on federal dependent
care programs are used by agencies to assess their current and future
needs with regard to dependent care and to determine ways to
communicate with employees about the availability of dependent
care programs. Agencies, in reviewing their workplace flexibilities,
are to “determine whether opportunities exist to use flexible work
options to address any recruitment and retention challenges.”124
The Senate report also addresses two issues included in the House report. With
regard to the Narragansett Bay, Rhode Island, wage area, the committee directs the
FPRAC to make this wage area “the immediate order of business” as the employees
within the wage area “have waited 3 years for the FPRAC to address their concerns.”
As for retirement systems modernization, the committee report notes the February
2008 date for operations to commence and “encourages OPM to continue to work
cooperatively with GAO to minimize potential risks and project delays.”125
124 S.Rept. 110-129, p. 95.
125 Ibid., pp. 95-96.

CRS-57
H.R. 2829, as reported in the Senate, would provide limitations on
administrative expenses of $124.4 million under salaries and expenses and $17.1
million under the OIG which are greater than those requested in the President’s
budget. These funds are for the retirement and insurance programs, including
retirement systems modernization, and to “help restore the OIG’s budget to previous
levels,” respectively.126
The Government Managers Coalition, comprising the Senior Executives
Association, the Federal Managers Association, the Professional Managers
Association, the Federal Aviation Administration Managers Association, and the
National Council of Social Security Management Associations, has suggested that
unused sick leave be made creditable service for retirement for federal employees
under the Federal Employees Retirement System (FERS). An analysis by the
Congressional Research Service indicated that employees under FERS are using
more sick leave than federal employees covered by the Civil Service Retirement
System, under which unused sick leave is creditable service for retirement.127
Office of Special Counsel (OSC).128 The President’s budget requested, and
H.R. 2829, as passed by the House and reported in the Senate, provides an FY2008
appropriation of $16.4 million for the OSC. The authorization for the agency expires
on September 30, 2007. OSC projected a continued increase in the number of
prohibited personnel practice cases and disclosure cases received in its budget
submission. Noting the investigations recently undertaken by the OSC, the House
committee report urges the agency “to carefully evaluate the need for additional
appropriations” and formally request from OMB any additional funds necessary
through a budget amendment.129 During House consideration of H.R. 2829 on June
27, 2007, Representative Tom Davis offered an amendment (H.Amdt. 460) to
decrease OSC’s appropriation by $1 million. The amendment was not agreed to by
a 146-279 (Roll No. 587) vote on June 28, 2007.130
The Senate committee report “strongly urges the OSC to work with
whistleblower advocacy organizations to promote the highest level of confidence in
the Whistleblower Protection Act and the OSC,” reiterates the House committee
language related to the need for additional appropriations, and specifies that the
agency’s FTE total “should not be below 102 or above 116.”131 According to the
report, the staffing should range from 70 to 75 FTEs at headquarters, 6 to 8 FTEs at
the Midwest field office, 9 to 11 FTEs at the Dallas field office, 8 to 10 FTEs at the
126 Ibid., pp. 96-97.
127 See CRS Report RL32596, Sick Leave: Usage Rates and Leave Balances for Employees
in Major Federal Retirement Systems
, by Curtis W. Copeland.
128 This section was written by Barbara Schwemle, Analyst in American National
Government, Government and Finance Division.
129 H.Rept. 110-207, pp. 59, 71, 76-77, 79.
130 See, Congressional Record, daily edition, vol. 153, June 27, 2007, pp. H7321-H7322 and
June 28, 2007, pp. H7396-H7397. See also, Shawn Zeller, “Investigative Drama: Special
Counsel’s Crusade,” CQ Weekly, August 6, 2007, p. 2353.
131 S.Rept. 110-129, pp. 99-100.

CRS-58
Oakland field office, and 9 to 12 FTEs at the District of Columbia field office. OSC
is directed to communicate with the Committee 45 days in advance of any
organizational change that would affect these staffing numbers.
On October 10, 2007, the legal director of the Government Accountability
Project and the executive directors of Public Employees for Environmental
Responsibility and the Project on Government Oversight sent letters to the chairman
and ranking members of the Senate Committee on Homeland Security and
Governmental Affairs and the House Committee on Oversight and Government
Reform; the Senate Subcommittee on Oversight of Government Management, the
Federal Workforce, and the District of Columbia and the House Subcommittee on the
Federal Workforce, Postal Service, and the District of Columbia; and the Senate and
House Appropriations Subcommittees on Financial Services and General
Government, urging them to deny the Special Counsel’s request for an additional
appropriation of $3 million for FY2008, until an investigation of the Special Counsel
being conducted by OPM’s inspector general is completed. The OSC requested the
additional amount to fund investigations of allegations that the White House
conducted political briefings at federal agencies in violation of the Hatch Act.
Among the concerns expressed in the letter are that “there is no guarantee that any
additional monies provided to OSC would be used for [the] intended purpose” and
“OSC simply cannot take on any more responsibilities without further abandoning
its primary constituency: government whistleblowers.”132
The Federal Merit System Reauthorization Act of 2007, S. 2057 and H.R. 3551,
is currently pending in the Senate Committee on Homeland Security and
Governmental Affairs and House Committee on Oversight and Government Reform.
The legislation, introduced by Senator Daniel Akaka and Representative Danny
Davis, would reauthorize the OSC for three years and includes provisions to enhance
the agency’s reporting requirements. The OSC has revised its policies governing
requests and appeals under the Freedom of Information Act and access to agency
records under the Privacy Act.133
National Archives and Records Administration (NARA).134 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,
132 Letter from Tom Devine, Jeff Ruch, and Danielle Brian to Senators Joseph Lieberman
and Susan Collins, Representatives Henry Waxman and Tom Davis, Senators Daniel Akaka
and George Voinovich, Representatives Danny Davis and Kenny Marchant, Senators
Richard Durbin and Sam Brownback, and Representatives Jose Serrano and Ralph Regula.
The letter is available on the Internet at [http://www.whistleblower.org].
133 U.S. Office of Special Counsel, “Freedom of Information Act; Implementation,” Federal
Register
, vol. 72, no. 142, July 25, 2007, pp. 40711-40716. U.S. Office of Special Counsel,
“Privacy Act; Implementation,” Federal Register, vol. 72, no. 192, October 4, 2007, pp.
56617-56618.
134 This section was written by Harold Relyea, Analyst in American National Government,
Government and Finance Division.

CRS-59
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.
As indicated in Table 7, the President’s FY2008 request for NARA was almost
$369 million, which was about $37 million more than was appropriated for FY2007.
Of this requested amount, almost $313 million was sought for operating expenses,
an increase of $34 million over the FY2007 appropriation for this account. For the
electronic records archive, $58 million was sought, a $13 million increase over the
previous fiscal year allocation; for repairs and restoration, a little less than $9 million
was sought, which was slightly below the FY2007 appropriation; and for the
NHPRC, no appropriation was 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 sought in
order to focus funding on operations that directly affect management, access, and the
preservation of federal records.
The House approved the amounts recommended by appropriators for NARA,
totaling a little more than $388 million, which was almost $20 million more than the
President’s request. Of this amount, $315 million was provided for operating
expenses, an increase of a little more than $2 over the requested amount; $58 million
was allocated for the electronic records archive, which was the same as the requested
amount; and $16 million was appropriated for repairs and restoration, which was
almost twice the amount requested. While no funds had been requested for the
NHPRC grants program, the House approved $10 million as recommended by
appropriators, allocating $8 million for grants and $2 for NHPRC operating
expenses.
The Senate Appropriation Committee recommended $396 million for NARA,
about $8 million more than the House-approved allotment and about $27 million
more than the amount requested. Of the amount recommended by Senate
appropriators, almost $314 million was provided for operating expenses, an increase
of about $1 million over the requested amount; $58 million was allocated for the
electronic records archive, which was the same as the requested amount, and a little
more than $25 million was recommended for repairs and restoration, which was
approximately $16 million more than the amount requested. While the President had
not requested any funds for the NHPRC, Senate appropriators recommended $10
million.
National Credit Union Administration (NCUA).135 The NCUA is an
independent federal agency funded entirely by the credit unions that 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
135 This section was written by Pauline Smale, Economic Analyst, Government and Finance
Division.

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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 requested $950,000 for
FY2008. The House approved $1 million for the fund in H.R. 2829. The Senate
Appropriations Committee recommended $950,000.
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
requested the same amount for FY2008. The House approved and the Senate
Appropriations Committee recommended a $1.5 billion limitation in H.R. 2829.
Securities and Exchange Commission (SEC).136 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 requested $905.3 million, an increase of 1.4%
over FY2007. Of that amount, $875 million would come from current-year offsetting
fee collections, and the remaining $30.3 million from prior-year unobligated
balances. No appropriation from the general fund would be required.137 In FY2007,
the enacted budget authority was $892.6 million, of which $25.0 million was prior-
year unobligated balances. There would be no direct appropriation from the general
fund.
The House Appropriations Committee recommended, and the House approved,
$908.4 million, $15.9 million (1.8%) above the FY2007 budget, and $3.1 million
(0.3%) above the Administration’s FY2008 request. Of that amount, $867.0 million
would come from current-year fee collections and $41.4 from prior year balances.
There would be no direct appropriation from the general fund. The Senate
Appropriations Committee recommended $905.3 million for FY2008, an increase of
1.4% over FY2007 and the same as the President’s request. Of that amount, $863.9
million would come from current-year offsetting fee collections, and the remaining
$41.4 million from prior-year unobligated balances. No direct appropriation from the
general fund would be required.
136 This section was written by Mark Jickling, Specialist in Public Finance, Government and
Finance Division.
137 SEC fees are treated as direct appropriations in H.R. 2829, and not as off-setting
collections. This report follows the convention established in H.R. 2829 for SEC fees.

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Selective Service System (SSS).138 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.139 All males ages 18 through
25 and living in the United States are required to register with the SSS. 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.
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.140
Funding of the Selective Service has remained relatively stable over the last
decade. For FY2008, the House approved, and the Senate reported, $22 million, the
same as the President’s request and about $3 million less than the FY2007
appropriation.
Small Business Administration (SBA).141 The SBA is an independent
federal agency created by the Small Business Act of 1953.142 Although the agency
administers a number of programs intended to assist small firms, arguably its three
most important functions are: (1) to guarantee — principally through the agency’s
Section 7(a) general business loan program — business loans made by banks and
other financial institutions; (2) to make long-term, low-interest disaster loans to small
businesses, nonprofits, and households that are victims of hurricanes, earthquakes,
other physical disasters, and acts of terrorism; and (3) to serve as an advocate for
small business within the federal government.
The Senate Appropriations Committee recommended $568 million in new
budget authority compared to the House’s approval of $582 million for FY2008.
The Senate Committee recommended amount is $4 million below the FY2007
enacted amount and $104 million more than the Administration requested. The
Senate Committee recommended $2 million for business loan subsidies, but the
House-passed bill includes $82 million for this purpose; the Administration
requested no funds for business loan subsidies. The Committee recommended $412
million for salaries and expenses, compared to $347 million approved by the House
and $310 million requested by the Administration.
138 This section was written by David Burrelli, Specialist in National Defense, Foreign
Affairs, Defense, and Trade Division.
139 See [http://www.sss.gov/].
140 See H.R. 163, October 5, 2004, failed by Yeas and Nays: (2/3 required): 2 - 402 (Roll no.
494).
141 This section was written by Eric Weiss, Analyst in Economics, Government and Finance
Division.
142 P.L. 83-163, as amended. 62 Stat. 262.

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The Senate recommended agreeing with the House-passed bill and the
Administration request that there be no new budget authority for the disaster loan
program in FY2008. In FY2007, the program received $113 million. Up to $156
million in unused budget authority that carried over from previous years could be
used to operate the program in FY2008.
Lending authority would stay the same for all loan programs.

United States Postal Service (USPS).143 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.144 However, Congress does provide an
annual appropriation to compensate USPS for revenue it forgoes in providing free
mailing privileges to the blind145 and overseas voters.146 Appropriations for these
purposes were authorized by the Revenue Forgone Reform Act of 1993 (RFRA).147
This act also authorized Congress to reimburse USPS $29 million each year until
2035 for postal services provided at below-cost rates to not-for-profit organizations
in the early 1990s.148
In its FY2008 budget submission, USPS requested a $153.4 million
appropriation.149 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.
In its FY2008 budget, the Administration proposed a total appropriation of
$88.9 million,150 $20 million less than was enacted for FY2007. Of this, $64.5
143 This section was written by Kevin Kosar, Analyst in American National Government,
Government and Finance Division. Also see CRS Report RS21025, The Postal Revenue
Forgone Appropriation: Overview and Current Issues
, by Kevin Kosar.
144 United States Postal Service Annual Report 2006 (Washington: USPS, 2006), p. 3.
145 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].
146 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.
147 107 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.
148 See CRS Report RS21025, The Postal Revenue Forgone Appropriation: Overview and
Current Issues
, by Kevin Kosar, pp. 3-4.
149 USPS, “Fiscal Year 2008 Appropriation Request,” December 6, 2006, at
[http://www.usps.com/financials/_pdf/Appropriations-2008_Public.pdf].
150 Office of Management and Budget, President’s Budget FY2008 — Appendix
(continued...)

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million would be for revenue forgone in FY2008, and $24.4 million would be for a
reconciliation adjustment for underestimated revenue forgone in FY2005. The
Administration’s FY2008 budget not only recommended less revenue forgone
funding than USPS requested, but also would eliminate the $29 million annual
reimbursement authorized by RFRA.151 Additionally, the Administration’s budget
would not permit any of the $88.9 million appropriation to be obligated until October
1, 2008, which is in FY2009. (Since FY1994, Congress has made the RFRA
reimbursement portion of the USPS appropriation available for obligation in the
upcoming fiscal year and delayed the availability of the revenue forgone portion of
the appropriation to the following fiscal year.)
On June 11, 2007, the House Appropriations Committee approved a bill (H.R.
2829; H.Rept. 110-207) that recommended a USPS appropriation of $117.9 million.
Of this amount, $29 million would be for the RFRA reimbursement and $88.9
million would be for revenue forgone. As in previous years, the committee
recommended making the RFRA reimbursement available for obligation in the
upcoming fiscal year (FY2008) and the revenue forgone payment available in the
following fiscal year (FY2009).
On June 21, the House Appropriations Committee approved an amended version
of the bill that did not include the $29 million RFRA reimbursement payment. This
reduced the recommended USPS appropriation to $88.9 million, an amount equal to
the amount proposed in the President’s FY2008 budget and $20.1 million less than
was enacted in FY2007. In its report on the bill, the committee did not state why it
had not approved the $29 RFRA reimbursement.152 The committee did express its
concerns over USPS’s possible closure of postal facilities in the Bronx borough of
New York City, Pasadena, California, and elsewhere. The committee also expressed
its concerns over the quality of mail delivery service in Chicago, Illinois, and directed
USPS to report to Congress on USPS efforts to “take into consideration the views of
local postal management in the development of appropriate staffing levels to ensure
that postal customers receive the quality mail service that they expect and deserve.”
The Senate Appropriations Committee recommended a postal appropriation of
$117.9 million, $29 million more than the $88.9 million recommended by the
Administration and approved by the House. Of this amount, $29 million would be
for the RFRA reimbursement and $88.9 million would be for revenue forgone. As
in the past, the committee would have the RFRA reimbursement paid to USPS in the
upcoming fiscal year (FY2008) and the revenue forgone payment would become
available to USPS in the following fiscal year (FY2009). The Senate Committee
report expressed concern regarding mail delivery delays in Chicago and the
150 (...continued)
(Washington: GPO, 2007), p. 1116.
151 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.
152 U.S. Congress, House Committee on Appropriations, Financial Services and General
Government Appropriation Bill
, 2008, 110th Cong., 1st sess., H.Rept. 110-207 (Washington:
GPO, 2007), pp. 84-86.

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consolidation of mail facilities.153 It directed USPS to not implement consolidation
decisions affecting facilities in Sioux City, Iowa, Aberdeen, South Dakota, and
Alexandria, Louisiana, until it “implements the recommendations of the GAO154 and
develops a mechanism to evaluate potential and actual impacts on delivery.” The
Committee also urged USPS to “take into consideration the views of local postal
management in the development of appropriate staffing levels to ensure that postal
customers receive the quality mail service that they expect and deserve.” Finally, the
Committee commended USPS on its issuance of a “Forever Stamp,” and directed
GAO to produce a study of USPS’s screening of mail addressed to federal agencies
for biological threats.
United States Tax Courts (USTC).155 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 $2.3 million below the
USTC’s FY2007 appropriation. The House approved $45.1 million for the USTC
for FY2008, and the Senate Appropriations Committee recommended $45.3 million,
the same as the President’s request.
General Provisions Government-Wide156
The Financial Services and General Government Appropriations bill includes
general provisions which apply either government-wide or to specific agencies or
programs. There may also be general provisions at the end of an 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.157 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
153 U.S. Congress, Senate Committee on Appropriations, Financial Services and General
Government Appropriation Bill
, 2008, 110th Cong., 1st sess., S.Rept. 110-129 (Washington:
GPO, 2007), pp. 106-108.
154 U.S. Government Accountability Office, U.S. Postal Service: Mail Processing
Realignment Efforts Underway Need Better Integration and Explanation
, GAO-07-717
(Washington: GAO, 2007).
155 This section was written by Garrett Hatch, Analyst in American National Government,
Government and Finance Division.
156 This section was written by Barbara Schwemle, Analyst in American National
Government, Government and Finance Division.
157 FY2008 Budget, Appendix, pp. 9-12.

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District of Columbia, and Independent Agencies Appropriations Bill for FY2006,158
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.) Inclusion of the provisions
in H.R. 2829, as passed by the House and reported in the Senate, is noted.
! Section 809, which prohibits payment to political appointees who
are filling positions for which they have been nominated, but not
confirmed. Included as Section 709 of the bill as passed by the
House and reported in the Senate, and made permanent.
! 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. Included as
Section 718 of the bill as passed by the House and reported in the
Senate.
! 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. Included as Section
719 of the bill as passed by the House and reported in the Senate.
! 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. Included as Section 722 of the bill as passed by
the House and reported in the Senate.
! 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. Included
as Section 733 of the bill as passed by the House and reported in the
Senate.
! 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
158 P.L. 109-115, November 30, 2005, 119 Stat. 2495-2507.

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proposed regulations limiting the detail of executive branch
employees to the legislative branch. Included as Section 735 of the
bill as passed by the House and reported in the Senate.
! 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. This
provision is not included in the bill as passed by the House or
reported in the Senate.
! Section 839, which requires appropriate executive department and
agency heads either to transfer funds to, or reimburse, the Federal
Aviation Administration to ensure the uninterrupted, continuous
operation of the Midway Atoll airfield. This provision is not
included in the bill as passed by the House, but is included as
Section 737 of the bill as reported in the Senate.
! 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 less than
100 full-time employees. This provision is not included in the bill
as passed by the House or reported in the Senate.
! 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 the analysis
reveals that savings would exceed 10 percent 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. Included as Section 738 of the bill as passed by the House
and Section 739 of the bill as reported in the Senate.
! Section 845, which precludes contravention of the Privacy Act.
Included as Section 741 of the bill as passed by the House and
Section 742 of the bill as reported in the Senate.
The FY2008 budget proposed a new Section 834 to provide a 3.0% pay (annual
and locality pay combined) adjustment for federal civilian employees. Section 739
of H.R. 2829 as passed by the House, and Section 740 of the bill as reported in the
Senate, provide a 3.5% pay adjustment for federal civilian employees, including
employees in the Department of Homeland Security and employees in the
Department of Defense (DOD) who are represented by a labor organization. DOD
employees who are eligible to be represented by a labor organization, but are not so
represented, will receive the pay adjustment unless pay for their positions is adjusted
under 5 U.S.C. §9902.159 Since the inception of locality pay in 1994, pay areas with
159 The Statement of Administration Policy on H.R. 2829 issued by OMB on June 27, 2007,
expressed strong opposition to the 3.5% pay adjustment, stating that it “would cost agencies
(continued...)

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the largest pay gaps receive the largest locality pay increases. Applying that
principle, OPM projects that a 3.0% pay adjustment would result in a net (annual and
locality) pay adjustment of 3.49% in the Washington, DC pay area and that a 3.5%
pay adjustment would result in a net (annual and locality) pay adjustment of 4.49%
in the Washington, DC pay area. The corresponding projected percentages for the
“Rest of the United States” pay area would be 2.75% (under a 3.0% adjustment) and
2.99% (under a 3.5% adjustment).160
A new provision, included as Section 743 of the bill as passed by the House, but
not included in the bill as reported in the Senate, would require the Office of
Management and Budget to submit a report on budget information relating to
activities to restore the health of the Great Lakes ecosystem. Another new provision,
included as Section 746 of the bill as reported in the Senate, but not included in the
bill as passed by the House, would require the home pages of departments and
agencies to provide a direct link to their respective Inspectors General (IG), and
requires the IG websites to post any public report or audit and to include a direct link
through which employees can anonymously report waste, fraud, and abuse.
Section 901 of the House-passed bill also would prohibit the use of funds to
implement Executive Order 13422 related to the authority of the President over
executive agency rulemaking.161 During markup of the bill by the Senate
Appropriations Committee, an amendment, offered by Senator Richard Durbin and
agreed to by voice vote, struck this provision from the Senate version of the bill.
Competitive Sourcing162
Although the term “competitive sourcing” was coined by the Bush
Administration in 2001, public-private competition began in 1966, with the
publication of Office of Management and Budget (OMB) Circular A-76. Circular A-
76 provides policy and guidance for conducting competitions involving government
employees and contractors. For many years, OMB continued to be the exclusive
source of guidance on public-private competitions. The late 1990s witnessed a
159 (...continued)
over $600 million in FY2008 and would not target any specific recruitment or retention
challenges.” The statement also urged that the provision related to a pay adjustment for DHS
and DOD employees be deleted, saying that it “backs away from the concept of pay-for-
performance and is ambiguous as to how the increase would be applied.” (p. 4.)
160 U.S. Office of Personnel Management, Option for Allocating Locality Pay in 2008, tables
provided to CRS by electronic mail on November 1, 2007.
161 See Congressional Record, daily edition, vol. 153, June 27, 2007, pp. H7322-H7323. For
an analysis of the Executive Order, see CRS Report RL33862, Changes to the OMB
Regulatory Review Process by Executive Order 13422
, by Curtis W. Copeland.
162 This section was written by L. Elaine Halchin, Analyst in American National
Government, Government and Finance Division.

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notable change, with the advent of competitive sourcing legislation, and, in
particular, the passage of bills containing competitive sourcing provisions.163
The language regarding competitive sourcing in the House version of H.R. 2829
is very similar in substance to that in the Senate bill, although the section numbers
differ. Section 738(a) of the House bill (Section 739(a) in the Senate bill) would
prohibit the use of funds for converting an agency activity involving 11 or more
federal employees to contractor performance unless certain conditions are met.
Public-private competitions that meet this size criterion would have to include a most
efficient organization (MEO); would show that the cost of contractor performance
would result in a savings of at least $10 million or 10% of the MEO’s personnel
costs, whichever amount is lesser; and would not provide a contractor with an
advantage by permitting the company to provide health and retirement benefits to the
employees performing the government activity that are less than what federal
employees receive.164 The first two conditions appear designed to address two
distinctions between standard competitions and streamlined competitions. Under
Circular A-76, agencies are required to develop an MEO and apply the conversion
differential (that is, $10 million or 10% of the MEO’s personnel costs) for standard
competitions. (An agency is required to use a standard competition when a public-
private competition involves more than 65 full-time equivalents (FTEs).165) In
streamlined competitions, an agency may develop an MEO but is not required to do
so, and the conversion differential is not calculated.166 (An agency may use a
streamlined or a standard competition when a public-private competition involves 65
or fewer FTEs.) The third condition may be seen as an effort to ensure that a
contractor does not gain a cost advantage in competitions by paying less for benefits
than the government does, thus lowering the cost of his or proposal. Alternatively,
others may see this condition as a restriction on the ability of a contractor to prepare
a competitive proposal. Certain organizations and procurement activities, such as the
Department of Defense and depot maintenance contracts, would be exempt.
Although Circular A-76 does not appear to prohibit conducting a public-private
competition for work that is being performed by a contractor, some of the language
in the circular seems to emphasize holding competitions for work being performed
by federal employees. For example, the circular’s policy statement says, in part:
“The longstanding policy of the federal government has been to rely on the private
sector for needed commercial services.... Identify all activities performed by
government personnel as either commercial or inherently governmental.... Perform
inherently governmental activities with government personnel.... Use a streamlined
163 See CRS Report RL32833, Competitive Sourcing Statutes and Statutory Provisions, by
L. Elaine Halchin.
164 A most efficient organization is the staffing plan of the agency tender, which is the
government’s response to a solicitation.
165 A full-time equivalent (FTE) is “[t]he staffing of Federal civilian employee positions,
expressed in terms of annual productive work hours (1,776 [hours]) rather than annual
available hours that includes non-productive hours (2,080 hours).” (U.S. Office of
Management and Budget, Circular No. A-76 (Revised), May 29, 2003, p. D-5.)
166 Ibid., pp. B-4 and C-2.

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or standard competition to determine if government personnel should perform a
commercial activity.”167 Section 738(b) of the House bill (Section 739(b) of the
Senate bill) notes that the circular does not prevent holding competitions for working
being performed by contractors, and it also requires that Circular A-76 include
procedures and policies for these types of competitions.
Currently, only the agency tender official (ATO) is permitted to file a protest on
behalf of government employees, and protests may be filed only for standard
competitions.168 Section 738(b) of the House bill (Section 739(b) of the Senate bill)
would allow a protest to be filed for any competition (that is, streamlined as well as
standard) conducted under Circular A-76, and for any decision made without benefit
of an A-76 competition to convert an agency function from employee performance
to contractor performance. This section also would permit an individual selected by
a majority of the affected employees to represent the employees in a protest involving
an A-76 competition or a decision to outsource work without a competition. The
ATO would retain the authority to file a protest on behalf of the employees.
Currently, an ATO is not required to file a protest: he or she “shall file a protest in
connection with ... [a] public-private competition unless the [agency tender] official
determines that there is no reasonable basis for the protest.”169 Some have been
concerned that agency employees’ interests may not be adequately represented since
an ATO determines unilaterally whether there is a basis for a protest. Hence,
supporters of this view might argue that another individual, such as a union
representative, would be a better choice for representing the affected employees. In
response, the private sector might argue that allowing the ATO to file a protest is
sufficient protection for agency employees. Additionally, contractors might note that
their employees cannot band together and select someone to represent them in a
protest.
If enacted, this section would broaden employees’ protest rights in other ways
as well. Specifically, section 738(c)(2) of the House bill (Section 739(c)(2) of the
Senate bill) would permit the individual representing employees affected by a public-
private competition to intervene in any civil action brought by an interested party
from the private sector. Additionally, this section would permit protests and civil
actions that challenge the selection of a provider (that is, government employees or
a contractor) at the conclusion of a competition.
The final substantive provision in this section would prohibit the use of funds
made available by this act for certain purposes. That is, none of the funds
appropriated by this act could be used by OMB for directing or requiring an agency
to take any action related to a public-private competition, or a direction conversion
of a government activity from one sector to another. Similarly, none of the funds
could be used by another agency take an action that was directed or required by
OMB.
167 Ibid., p. 1.
168 The agency tender official is an “agency official with decision-making authority who is
responsible for the agency tender and represents the agency tender during source selection.”
(Ibid., p. D-2.)
169 31 U.S.C. §3351(2); Sec. 326(b)(1) of P.L. 108-375.

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This section would apply to FY2008 and succeeding fiscal years.
Cuba Sanctions170
Since the early 1960s, U.S. policy toward Communist Cuba has consisted
largely of efforts to isolate the island nation through comprehensive economic
sanctions, including prohibitions on U.S. financial transactions — the Cuban Assets
Control Regulations (CACR) — that are administered by the Treasury Department’s
Office of Foreign Assets Control (OFAC). Restrictions on travel have been a key
and often contentious component of U.S. efforts to isolate the Cuban government.
The regulations do not ban travel itself, but place restrictions on any financial
transactions related to travel to Cuba. Pursuant to the CACR, certain categories of
travelers may travel to Cuba under a general license, which means that there is no
need to obtain special permission from OFAC. In addition, a variety of travelers may
be eligible to apply for specific licenses, which are reviewed and granted by OFAC
on a case by case basis. This includes travelers engaging in family visits;
educational, religious or humanitarian activities; or activities related to the marketing,
sale, delivery or servicing of authorized exports to Cuba.
Some U.S. commercial agricultural exports to Cuba have been allowed since
2001 under the terms of the Trade Sanctions Reform and Export Enhancement Act
of 2000 or TSRA, but with numerous restrictions and licensing requirements.
Exporters are denied access to U.S. private commercial financing or credit, and all
transactions must be conducted in cash in advance or with financing from third
countries. Since late 2001, Cuba has purchased over $1.7 billion in agricultural
products from the United States, although the annual amount began to decline in
2005. Overall U.S. exports to Cuba, the majority in agricultural products, rose from
$146 million in 2002 to a high of $404 million in 2004, and then declined to $369
million in 2005 and $340 million in 2006.171
In February 2005, the Administration tightened sanctions against Cuba by
further restricting how U.S. agricultural exporters may be paid for their sales. OFAC
amended the CACR to clarify that the term “payment of cash in advance” for U.S.
agricultural sales to Cuba means that the payment is to be received prior to the
shipment of the goods. This differs from the practice of being paid before the actual
delivery of the goods, a practice that had been utilized by most U.S. agricultural
exporters to Cuba since such sales were legalized in late 2001. U.S. agricultural
exporters and some Members of Congress strongly objected on the grounds that the
action constituted a new sanction that violated the intent of TSRA, and could
jeopardize millions of dollars in U.S. agricultural sales to Cuba. OFAC Director
170 This section was written by Mark Sullivan, Specialist in Latin American Affairs, Foreign
Affairs, Defense, and Trade Division. For additional information, see CRS Report
RL33819, Cuba, Issues for the 110th Congress, by Mark P. Sullivan.
171 World Trade Atlas. Department of Commerce Statistics.

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Robert Werner maintained that the clarification “conforms to the common
understanding of the term in international trade.”172
Since 2000, either one or both houses have approved provisions in the annual
Treasury Department appropriations bill that would ease U.S. economic sanctions on
Cuba (especially on travel and on U.S. agricultural exports) but none of these
provisions have ever been enacted. The Administration regularly threatened to veto
legislation if it included provision weakening sanctions on Cuba.
This year, both the House-passed and Senate Appropriations Committee-
reported versions of the FY2008 Financial Services and General Government
appropriations bill, H.R. 2829, contain a provision that would prevent Treasury
Department funds from being used to implement the February 2005 regulation that
requires the payment of cash in advance prior to the shipment of U.S. agricultural
goods to Cuba. The House adopted the provision, contained in Section 903 of the
bill, during June 28, 2007 floor consideration when it approved H.Amdt. 467 (Moran,
Kansas) by voice vote. In the Senate version, the provision is included in Section
619 of the bill. The Senate version also contains a provision, in Section 620, that
would authorize travel to Cuba under a general license for the marketing and sale of
agricultural and medical goods. The Administration’s statement of policy on the bill
maintained that the President would veto the measure if it contained a provision
weakening current restrictions against Cuba.173
In addition, the House Appropriations Committee report to accompany H.R.
2829 (H.Rept. 110-207) directs the Treasury Department, as part of its operating
plan, to provide the number of full-time equivalent staff dedicated to the Cuba
sanctions program within the Office of Foreign Assets Control.
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172 U.S. Department of the Treasury, Testimony of Robert Werner, Director, OFAC, before
the House Committee on Agriculture, March 16, 2005.
173 Executive Office of the President, Office of Management and Budget, “Statement of
Administration Policy, H.R. 2829 — Financial Series and General Government
Appropriations Act, 2008,” p. 1.