Appropriations for FY1998: VA, HUD, and Independent Agencies

Appropriations for FY1998: VA, HUD, and Independent Agencies

97-204 EPW
Appropriations for FY1998: VA, HUD,
and Independent Agencies
Updated November 17, 1997
Dennis W. Snook, Coordinator
Specialist in Social Legislation
Education and Public Welfare Division

Appropriations are one part of a complex federal budget process that includes budget
resolutions, appropriations (regular, supplemental, and continuing) bills, rescissions,
and budget reconciliation bills. The process begins with the President’s budget
request and is bounded by the rules of the House and Senate, the Congressional
Budget and Impoundment Control Act of 1974 (as amended), the Budget
Enforcement Act of 1990, and current program authorizations. In addition, the line
item veto takes effect for the first time in 1997.
This report is a guide to one of the 13 regular appropriations bills that Congress
passes each year. It is designed to supplement the information provided by the House
and Senate Subcommittees on VA, HUD, and Independent Agencies Appropriations.
It summarizes the current legislative status of the bill, its scope, major issues, funding
levels, and related legislative activity. The report lists the key CRS staff relevant to
the issues covered and related CRS products.
This report is updated as soon as possible after major legislative developments,
especially following legislative action in the committees and on the floor of the House
and Senate.
NOTE: A Web version of this document with
active links is available to congressional staff at
http://www.loc.gov/crs/products/apppage.html

Appropriations for FY1998: VA, HUD, and
Independent Agencies
Summary
The President signed H.R. 2158 (P.L. 105-65), appropriations for the
Departments of Veterans Affairs (VA) and Housing and Urban Development (HUD),
and several independent entities including the Environmental Protection Agency
(EPA), National Aeronautics and Space Administration (NASA), National Science
Foundation (NSF), the Federal Emergency Management Agency (FEMA), and the
Corporation for National and Community Service (CNCS). After subtracting for
FY1998 rescissions to HUD housing reserves, Congress approved $90.7 billion for
the VA-HUD bill, compared to the Administration’s request of $91.0 billion, and
FY1997's $85.9 billion (which reflects $3.65 billion in rescissions in P.L. 105-18).
Presidential line item vetoes canceled funding for 7 projects totaling $14 million,
including $10 million for 2 planned NASA telescopes. Also vetoed were 3
environmental cleanup projects, a veterans’ cemetery, an economic development
grant, and a facility to train Arab, Alabama police to meet weather emergencies.
Veterans programs will increase by $350 million to a FY1998 level of $40.4
billion; $355 million more is required for mandatory spending, mostly for cost-of-
living adjustments to income programs. Total VA discretionary spending, mostly for
medical care programs, actually appears to be slightly less. However, P.L. 105-33
gave VA authority to keep medical cost reimbursements, raising total FY1998 VA
discretionary spending about $600 million over FY1997.

The bill provides $9.4 billion for prevention of resident displacement and for
Section 8 renewals, HUD programs to provide housing assistance to families in need.
H.R. 2158 also provides $4.6 billion for Community Development Block Grants;
conferees added to amounts in previous versions of the bill that were to be set aside
from the grants for various activities and projects to assist in revitalizing communities,
and to help them adjust to the effects of welfare reform.
Funding for NASA continues to decline; the Administration requested a decline
of $209 million from $13.7 billion in FY1997, mostly from space flight and mission
support; Congress mitigated that proposed cut, adding $148 million to the request for
a total of $13.64 billion. However, research and education programs of NASA will
receive increases. Congressional commitment to research and education are
elsewhere evident: both Houses added to the request for NSF and VA research funds.
The President proposed a 36% increase in the Corporation for National and
Community Service, mostly for AmeriCorps; both Houses had proposed substantial
cuts (the House bill cut the appropriation to one-half of FY1997 levels). Conferees
approved a $25 million increase, and a total of $428 million.
Most administrative budgets increased only slightly or decreased. Congress
approved Administration requests for program administration increases for HUD,
FEMA, and the National Science Foundation (NSF), and for Inspector General
offices, but appropriated less than requested for VA and EPA.

Key Policy Staff
Name
Area of Expertise
CRS Div.
Tel.
Keith Bea
Emergency Management
GOV
7-8672
Richard Bourdon
Housing Finance
ECON
7-7300
Eugene Boyd
Community Development
GOV
7-8689
Michael Davey
Science and Space
STM
7-7074
Bruce Foote
Housing
ECON
7-7300
Martin Lee
Environmental Policy
ENR
7-7260
Ann Lordeman
National Community Service
EPW
7-2323
Christine Matthews
NSF
STM
7-7055
Bruce Mulock
Consumer Affairs
ECON
7-7775
David Radzanowski
NASA
STM
7-7059
Pauline Smale
Banking, Special Need Housing
ECON
7-7300
Marcia S. Smith
NASA
STM
7-7076
Dennis Snook
VA
EPW
7-7314
Susan Vanhorenbeck
Housing
ECON
7-7300

Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Total Appropriations in H.R. 2158 (P.L. 105-65) . . . . . . . . . . . . . . . . . . . . . . . . 2
Key Policy Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Department of Veterans Affairs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
VA Entitlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Program Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
General Operating Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Medical Care Resource Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Medical Research . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
VA Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Line Item Veto . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Department of Housing and Urban Development . . . . . . . . . . . . . . . . . . . . 7
Prevention of Resident Displacement and Section 8 Renewals . . . . . . 7
Transformation of Public Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Development Funding: The Growing Use of Set-Asides . . . . . . . . . 10
Expanding Affordable Housing for Persons with Special Needs . . . . 11
Native American Housing Block Grants . . . . . . . . . . . . . . . . . . . . . . 12
Increasing Home Ownership Opportunities . . . . . . . . . . . . . . . . . . . . 13
Changes to FHA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Other Housing Finance Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Line Item Vetoes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Environmental Protection Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Line Item Veto . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Federal Emergency Management Agency . . . . . . . . . . . . . . . . . . . . . . . . . 21
National Aeronautics and Space Administration . . . . . . . . . . . . . . . . . . . . 22
Line Item Veto . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
National Science Foundation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Other Independent Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
American Battle Monuments Commission . . . . . . . . . . . . . . . . . . . . 27
Chemical Safety and Hazard Investigation Board . . . . . . . . . . . . . . . 27
Community Development Financial Institution Fund . . . . . . . . . . . . . 27
Consumer Information Center . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Consumer Product Safety Commission . . . . . . . . . . . . . . . . . . . . . . . 27
Corporation for National and Community Service (CNCS) . . . . . . . . 28
Council on Environmental Quality; Office of Environmental Quality
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Neighborhood Reinvestment Corporation (NRC) . . . . . . . . . . . . . . . 29
Selective Service System (SSS) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Supplemental Appropriations (P.L. 105-18) . . . . . . . . . . . . . . . . . . . . . . . 30
For Additional Reading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
CRS Issue Briefs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
CRS Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Selected World Wide Web Sites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

List of Tables
Table 1. Status of FY1998 Appropriations for VA, HUD, and Independent Agencies
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Table 2. Summary Table: VA, HUD and Independent Agencies Appropriations
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Table 3. Department of Veterans Affairs Appropriations,
FY1994 to FY1998 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Table 4. Appropriations: Department of Veterans Affairs, FY1998 . . . . . . . . . 6
Table 5. Department of Housing and Urban Development Appropriations, FY1994
to FY1998 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Table 6. Appropriations: Housing and Urban Development, FY1998 . . . . . . . 15
Table 7. Environmental Protection Agency Appropriations,
FY1994 to FY1998 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Table 8. Appropriations: Environmental Protection Agency, FY1998 . . . . . . . 20
Table 9. Appropriations: Federal Emergency Management Agency, FY1998 . 22
Table 10. National Aeronautics and Space Administration Appropriations, FY1994
to FY1998 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Table 11. Appropriations: National Aeronautics and Space Administration, FY1998
24
Table 12. National Science Foundation Appropriations,
FY1994 to FY1998 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Table 13. Appropriations: National Science Foundation, FY1998 . . . . . . . . . 26
Table 14. Appropriations: Other Independent Agencies, FY1998 . . . . . . . . . . 29

Appropriations for FY1998: VA, HUD, and
Independent Agencies
Most Recent Developments
On October 27, 1997, the President signed H.R. 2158 (P.L. 105-65), the bill to
fund VA, HUD, and Independent Agencies during FY1998. The House bill had
approved $91.5 billion in appropriations for FY1998 for VA/HUD, $1.1 billion more
than contained in the Senate bill, after adjusting for differences between the bills in
FY1998 rescissions from appropriations of previous years. The Administration had
requested $91.0 billion in appropriations in its FY1998 budget. After all action was
completed P.L. 105-65 contains $90.7 billion for VA-HUD for FY1998.
Line Item Vetoes. On November 1, 1997, the President exercised his line item
veto authority to eliminate 7 projects in the VA-HUD bill totaling $14 million.
Among the vetoed projects were 2 NASA telescopes costing $10 million, and waste
water treatment projects in Alabama, Vermont, and Pennsylvania. Also struck down
were plans for a veterans cemetery in Oklahoma City, a weather emergency training
facility in Alabama, and trade and development assistance in Montana.
Status
Table 1 shows the key legislative steps necessary for the enactment of the
FY1998 VA, HUD, Independent Agencies appropriation.
Table 1. Status of FY1998 Appropriations for VA, HUD, and
Independent Agencies
Conference
Subcommittee
Report
Line
Markup
House
House
Senate
Senate
Conference
P.L.
Approval
Item
Report Passage
Report Passage
Report
105-65
Veto
House Senate
House Senate
6/25
7/15
7/8
7/16
7/17
7/22
10/6
10/8
10/9
10/27
11/1

CRS-2
Total Appropriations in H.R. 2158 (P.L. 105-65)
Total VA/HUD and Independent Agencies appropriations are $90.7 billion for
FY1998. About 45% of the appropriations will go to support the nation’s veterans.
About 27% will fund housing and various urban renewal programs administered by
HUD. NASA and its space flight and education programs will receive about 15%.
About 8% will be used for environmental protection programs. Research and
education programs of the National Science Foundation will receive about 4% of the
bill. Emergency management under FEMA will receive about 1% of the bill. The
remaining independent agencies receive less than 1% of the total funding provided by
H.R. 2158.
Table 2. Summary Table: VA, HUD and Independent Agencies
Appropriations
(budget authority in billions of $)

FY1998
H.R. 2158
FY1997
P.L.
Bureau or Agency
Final
Request
House
Senate
105-65
Veterans Affairs
40.087
40.215
40.448
40.309
40.437a
Housing and Urban
16.303
24.573
25.123
24.836
24.352a
Development
Environmental Protection
Agency
6.799
7.645
7.205
6.976
7.361a
Federal Emergency
Management Agency
5.104
.839
1.028
0.789
0.806
National Aeronautics and
Space Administration
13.709
13.500
13.648
13.500
13.638a
National Science
3.270
3.367
3.487
3.377
3.429
Foundation
Other Independent
0.624
0.850
0.523
0.580
0.698
Agencies
Total Appropriations
85.896
90.989
91.462
90.368
90.721a
a Presidential line

item vetoes canceled a total of $14 million; $1 million from VA, $1 million from
HUD, $2 million from EPA, and $10 million from NASA.
Source: H.Rept. 105-175; S.Rept. 105-53; H.Rept. 105-297; Special Line Item Veto Message,
November 1, 1997.
* Rounded; may not add.

CRS-3
Key Policy Issues
Department of Veterans Affairs
Conferees approved $40.4 billion for VA, $350 million more than appropriated
for FY1997, and $222 million more than requested by the Administration. The final
amount was $9 million less than the House bill, but $128 million more than proposed
by the Senate. P.L. 105-65 provides $355 million in additional funds for cash
benefits, compared to FY1997. Discretionary funds, mostly medical care, would be
about $3 million less than the previous year. However, language in the Balanced
Budget Act of 1997 (P.L. 105-33) means VA can retain medical care cost recoveries
rather than pass those revenues on to the general treasury, as before. The
appropriations bill “guarantees” that at least $579 million of an estimated $604 million
will be collected in FY1998, making effective spending authority for VA medical care
$17.636 billion for FY1998, an increase of $623 million over the previous year, and
$98 million more than the Administration’s request, after adding the guaranteed cost
recovery to the amount specified in the President’s budget.
Table 3. Department of Veterans Affairs Appropriations,
FY1994 to FY1998
(budget authority in billions of current $)
FY1994
FY1995
FY1996
FY1997
FY1998
$36.83
$37.48
$38.37
$40.09
$40.44
Source: House Appropriations, Subcommittee on VA, HUD and Independent Agencies.
VA Entitlements. VA cash benefit programs, i.e., compensation for service-
connected disabilities and pensions for totally-disabled and poor wartime veterans
(and their eligible survivors); readjustment benefits (education and training, special
assistance for the disabled); veterans insurance and indemnities, and home loan
guarantees are mandatory (entitlement) spending, although required amounts are
annually appropriated. Veterans entitlement benefits, once increasing rapidly, but
now a relatively stable federal obligation to a declining population, constitute 53% of
total VA spending. The FY1998 budget estimates $21.5 billion will be necessary for
VA cash entitlement benefits, and P.L. 105-65 reflects that estimate.
Program Administration. The remaining VA expenditures, primarily those
associated with medical care, facility construction, and medical research are annual
discretionary appropriations, as are general administrative costs. Unlike the ratio of
entitlement spending to discretionary spending in the rest of the federal budget, the
discretionary portion of VA is increasing as a percent of total VA spending. In
FY1976, entitlements constituted 73% of VA’s budget, with the remaining 27%
discretionary appropriations. By FY1996, VA discretionary spending for health and
VA administrative costs had risen to 47% of VA’s total budget. For the entire federal
budget, about one-third of spending is discretionary.

CRS-4
Medical care. VA operates the largest health care system in the nation,
encompassing 173 hospitals, 175 nursing home and long-term care facilities, and 448
outpatient clinics. The FY1998 caseload is expected to increase by 135,000 veterans;
VA will serve 3.1 million different patients. VA health care continues to place
increasing emphasis on outpatient care: the inpatient caseload in FY1998 will decline
by nearly 19,000 patients to 891,000 while outpatient visits will increase by 2.5
million to 33.2 million, according to VA’s budget documentation.
Congress appropriated $17.0 billion for VA medical care for FY1997, and the
Administration requested that same amount for FY1998; the House Committee
endorsed that request. The budget also pro
1
jected flat appropriations for VA medical
care through FY2002, with a goal of increasing the VA patient load by 20% over the
period, offset by a per patient efficiency savings of 30%. The Administration also
assumes that by FY2002, 10% of the medical care budget could be funded by non-
appropriated funds collected as reimbursements for some of the costs that VA
sustains while providing services to veterans with medical insurance, or who are
otherwise obligated for some costs of their care. The budget proposed that net
receipts (estimated at $604 million for FY1998) of the Medical Care Cost Recovery
(MCCR) fund remain available to VA for veterans medical services rather than be
transferred to the Treasury as under current law.
The House accepted an Administration proposal for VA to retain MCCR
receipts. In floor action, the House added $48 million to the medical care account,
and guaranteed $579 million of the $604 million estimated to be collected by MCCR2.
The Senate bill added $68 million to the medical care account request, making the
Senate bill, at $17.027 billion, $5 million higher than the House bill. Conferees
approved $17.057, reflecting the conferees’ intent that VA compensation and pension
medical exams continue to be funded through the medical care account, rather than
through the General Operating Expenses (GOE) account as requested. Also,
conferees dropped language specifying that the MCCR guarantee be transferred from
the Superfund, but retained the guarantee of $579 million, because the language
causing the retention had been passed in P.L. 105-33.
General Operating Expenses. Conferees reduced the GOE request by the $68
million for medical exams the Administration assumed, but added $8 million back to
resolve Year 2000 computer problems.
Medical Care Resource Allocations. The Veterans Health Administration will
continue with its plan to improve the efficiency of VA medical care programs, while
expanding access to more veterans. In spite of increased caseload, VA predicted that
medical care employment would drop by 6,000 employees during FY1997. This
1 Because of accounting changes, a net $55 million in obligations that was shown as
medical care costs in FY1997 has been transferred to General Operating Expenses (GOE) for
FY1998. The Administration’s proposed freeze level reflects this change. Also, 1996
legislation (P.L. 104-262) capped medical care spending for FY1998 at $17.9 billion.
2 Although the guaranteed $579 million falls within the amount estimated for collections,
CBO estimated an additional $15 million in costs to the medical care account because of the
possibility that the estimate could overstate actual net receipts.

CRS-5
efficiency gain can be achieved only if patient care continues to shift more to
outpatient facilities. Because inpatient capacity is more concentrated in the older
population centers in the Northeast and Midwest, and outpatient demands are
increasing in the Southeast and Southwest, efficiency gains have regional implications,
as resources shift in response to the changing patterns of care.
The House report to accompany H.R. 2158 (H. Report 105-175) expressed
concern that resource shifts have endangered the quality of care received by patients
with special needs that may require more inpatient services. The Report called for a
General Accounting Office (GAO) review of the Veterans Equitable Resource
Allocation (VERA) methodology used by VA to instruct resource shifts, and a 4-
month delay in further shifts pending that review. The Senate report (S.Rept. 105-53)
accompanying its version of H.R. 2158 endorsed VERA, stating that “the Committee
opposes efforts to thwart this new, more equitable system.” Conferees dropped the
delay in funding shifts, and extended the GAO report date to 9 months.
Medical Research. On the House floor, $25 million was added for additional
research projects to study illnesses reported by Persian Gulf War veterans. The
Senate had stricken that language. After VA’s advice that only one-half the amount
could reasonable be spent on such research, conferees dropped it to $12.5 million.
VA Construction. Construction appropriations for VA major and minor
construction projects over the 10-year period, FY1987-1996, averaged around $600
million per year. During FY1997, construction appropriations totaled $426 million
(including $32.1 million for a replacement hospital at Travis, CA, that cannot be
obligated until the end of the fiscal year). The House bill recommended $337 million
in major and minor construction projects, $91 million more than the Administration
requested; the Senate proposed $259 million. Most of the added funds were for
construction of outpatient facilities at Asheville, NC and Lyons, NJ and for
renovations of facilities in Omaha, NE and Waco, TX. The Senate bill included funds
for a renovation at the facility in Pittsburgh, PA. The Administration and both
versions of H.R. 2158 provide funds for $31 million for additions to the VA cemetery
system to fund a new national cemetery at Cleveland, and major expansions at Ft.
Sam Houston, TX and the National Memorial Cemetery of AZ.
Conferees approved $353 million in construction funding, adding funds for new
outpatient facilities. Conferees redirected funds ($32 million) from FY1997 that had
been appropriated for the Travis hospital, as VA discontinued its plans to build that
replacement hospital. Conferees approved $71 million in new construction for
northern California outpatient access, and renovations of an existing facility acquired
from the Department of Defense (McClellan Hospital at Mather Field, Sacramento).
Line Item Veto. Planning for a national cemetery at Oklahoma City, an
appropriation of $900,000 added to the major construction account by conferees, was
canceled by Presidential line item veto.
For further discussion of VA’s budget and program issues, see CRS Report 97-
266, Veterans Issues in the 105 Congress.
th

CRS-6
Table 4. Appropriations: Department of Veterans Affairs, FY1998
(budget authority in billions of $)

FY1998
H.R. 2158
Department of Veterans
FY1997
P.L.
Affairs
Final
Request
House
Senate
105-65
Comp., Pension, Burial
18.671
19.933
19.933
19.933
19.933
Supplement (P.L. 105-18)
.928
0
0
0
0
Insurance/Indemnities
0.039
0.051
0.051
0.051
0.051
Housing Programs
0.173
0.192a
0.192a
0.192a
0.192a
Readjustment Benefits
1.377
1.366
1.366
1.366
1.366
Subtotal: Mandatory
21.188
21.543
21.543
21.543
21.543
Medical Care
17.013
16.959b
17.022
17.027
17.057
Med./Prosthetic Research
0.262
0.234
0.292
0.267
0.267
Construction, Majorc
0.251
0.080
0.160
0.093
0.177d
Construction, Minor
0.175
0.166
0.177
0.166
0.175
Grants for State Facilities
0.047
0.041
0.054
0.080
0.080
State Veteran Cemeteries
0.001
0.010
0.010
0.010
0.010
Parking Garage Fund
0.012
0
0
0
0
Nat’l Cemetery System
0.077
0.084
0.084
0.084
0.084
Gen. Operating Exp.
0.828
0.846
0.853
0.786
0.786
Admn. Exp. (Hsng. Prog.)
0.141
0.161
0.161
0.161
0.161
Inspector General
0.031
0.031
0.031
0.031
0.031
Medical Administration
0.061
0.060
0.060
0.060
0.060
Subtotal: Discretionary
18.899
18.672
18.905
18.766
18.894d
Subtotal
40.087
40.215
40.448
40.309
40.437d
(Veterans Affairs)
Source: H.Rept. 105-175; S.Rept 105-53; H.Rept. 105-297; Special Line Item Veto Message,
November 1, 1997.
a The FY1998 budget treats housing benefit account receipts as revenue transferred to the Treasury,
rather than as receipts offsetting VA’s previous year housing obligations, as in past budgets.
b Accounting changes for FY1998 reconcile difference between FY1997 medical care appropriation,
and amounts shown for Administration’s request for frozen level of FY1998 appropriations.

CRS-7
c $32 million in FY1997 major construction funds are not available for obligation until FY1998.
Appropriation Committee reports treat this as an FY1997 appropriation, as does this table;
Administration documents treat the amount as an advance appropriation for FY1998.
d Reflects $900 thousand canceled by presidential line item veto.
Department of Housing and Urban Development
President Clinton requested $24.6 billion in budget authority for the Department
of Housing and Urban Development (HUD) in FY1998. The enacted appropriation
bill for FY1997 provided $19.45 billion for HUD. This amount was later reduced by
rescissions to $16.3 billion.
The House bill (H.R. 2158) recommends $25.1 billion for HUD in FY1998, $550
million more than the President’s request, and $8.8 billion more than final FY1997
HUD appropriations, after adjusting for supplemental appropriations and the
Administration’s request for $990 million in rescissions of unobligated funds
appropriated for various housing programs in previous years. H.R. 2158 rescinds
$700 million of these unobligated funds. The Senate bill recommends $24.8 billion
for HUD in FY1998, and $135 million in rescissions of previously appropriated
spending authority.
Table 5. Department of Housing and Urban Development
Appropriations, FY1994 to FY1998
(budget authority in billions of current $)
FY1994
FY1995
FY1996
FY1997
FY1998
$24.87
$20.09
$19.13
$16.30
$24.35
Source: House Appropriations, Subcommittee on VA, HUD and Independent Agencies.
Prevention of Resident Displacement and Section 8 Renewals. The
President’s FY1998 budget request for HUD proposed a new Housing Certificate
Fund which would consolidate the existing Section 8 voucher and certificate rental
programs, and combine them in one fund with elements of the Prevention of Resident
Displacement account. The President requested $10.7 billion for this fund in FY1998.
The fund is to manage spending for the continued prevention of displacement for
families in public housing, Section 8, or other assisted housing programs, who would
be displaced by demolition, redevelopment, or non-renewal of existing contracts. As
passed by both the House and Senate, H.R. 2158 proposed $9.37 billion for the fund
for FY1998.
In conference, House and Senate conferees agreed to appropriate $8.18 billion
for Section 8 renewals, $850 million for Section 8 amendments, and $343 million for
resident displacement in FY1998. Also in an effort to further reduce the cost of
subsidizing housing to the federal government, the House recommended that the
reissuance of Section 8 certificates be delayed by three months, and that the annual
adjustment factor paid to owners be reduced when there is no turnover of the unit.

CRS-8
These provisions were agreed to by the Senate and both are contained in the final
version of the bill.
For more information on Section 8 expiring contracts, please see CRS Report
97-264, The Problem of Section 8 Housing Expiring Contracts.
Also, as passed by the House and Senate, H.R. 2158 rescinds $550 million of
recaptured Section 8 reserve funds. In the past, HUD’s accounting methods failed
to show a surplus of these reserve funds, and Congress believes that it is not necessary
to keep such a large sum in reserve.
The President proposed to renew Section 8 contracts expiring in FY1998 while
HUD continued with its portfolio reengineering program (to lower the existing cost
of renewals), and evaluated other options to terminate excessive subsidies while
bringing Section 8 contracts to market levels. When the House and Senate bills went
to conference, a restructuring plan was approved. This plan is Title V of the bill, and
is entitled “HUD Multifamily Housing Reform .”
The Section 8 restructuring plan established an Office of Multifamily Housing
Assistance Restructuring within HUD under the direction of the Secretary. The
purpose of this office will be to implement this Act and oversee the multifamily
housing restructuring process. (CRS is preparing a separate report on the
restructuring plan).
Congress has also shown its concern for the continued affordable housing of
disabled persons by including, in the final version of the bill, a $40 million set-aside
of the Housing Certificate Fund for rental assistance to disabled families who are
displaced as the result of the public housing projects being designated as “elderly
only” projects.
Another HUD program, the HOME Investment Partnership program, provides
state and local governments with funding for tenant-based rental assistance, and the
construction, acquisition and rehabilitation of affordable rental and ownership
housing. The President requested $1.3 billion for this program in FY1998. The
House bill provided $1.5 billion for the program with a set-aside of $15 million for
housing counseling assistance. The Senate bill provided $1.4 billion for the program
in FY1998.
As passed, H.R. 2158 appropriates $1.5 million for the program in FY1998. Of
this amount, $20 million is to be used for Housing Counseling and $10 million for a
program designed to demonstrate ways to expand the secondary market for affordable
home mortgage credit from private lenders, in urban and rural areas.

Transformation of Public Housing. The President’s request for public housing
funds in FY1998 would further transform public housing through the consolidation
of resources for the operation and capital improvements (including modernization) of
public housing developments. The budget requested $2.9 billion in operating funds
and $2.5 billion for the capital improvement fund, including a set-aside of $50 million
for support services and economic development to aid public housing residents seek
jobs and training. Another $5 million would be set aside for the Tenant Opportunity

CRS-9
program, to be used by resident organizations to provide training, support services
and economic opportunities for residents affected by welfare-reform.
As passed by the House and Senate, the VA-HUD appropriations bill provides
$2.5 billion for the Public Housing Capital Fund, with $30 million set-aside for
technical assistance, and $5 million for the Tenant Opportunity Program.
The House and Senate agreed with the President’s request and provided $2.9
billion for public housing operating subsidies in FY1998.
In its administrative provisions, H.R. 2158 extends through FY1998, the
provisions included in the FY1997 appropriations which eliminate the one-for-one
replacement requirement for public housing, eliminate federal preferences, and permit
PHAs to charge a minimum rent.
To continue improving severely distressed public housing, the President’s
budget requested $524 million for the HOPE VI program, including $421 million to
be used for site restoration, demolition, or the replacement of obsolete units. The
remaining $103 million would pay for 10,000 additional Section 8 certificates to
relocate households occupying severely distressed units.
The House bill funded this program at the requested level, with $5 million
reserved for technical assistance. The Senate bill provided $550 million for the HOPE
VI program, including a $50 million set-aside for a new demonstration program which
would demolish obsolete public housing projects for the elderly, and replace them
with housing and supportive services.
As passed by the House and Senate, H.R. 2158 provides $550 million for the
HOPE VI revitalization program in FY1998, with $26 million to be made available
for the demolition, replacement or revitalization of obsolete public housing projects
for the elderly, and $10 million to be used at the Secretary’s discretion, for technical
assistance and contract expertise.
In its administrative provisions, H.R. 2158 includes language which provides
HUD with the flexibility to make rehabilitation grants and loans in disposing of HUD-
owned and HUD-held properties.
In recent years, HUD, through the Drug Elimination Grant program, has
assisted PHAs and local jurisdictions implement anti-crime and anti-drug initiatives
to make public housing developments safer. For FY1998, the President requested
$290 million for the program, the same amount appropriated for FY1997. Both the
House and Senate bills funded this program at the requested level.
In the final House- and Senate-passed version of the bill, H.R. 2158 provides
$310 million for the Drug Elimination Grant program, including $20 million for the
new “New Approach Anti-Drug Program”. This new program authorizes HUD to
make competitive grants to providers of multifamily housing to provide, augment, or
assist in the reduction, prevention, and prosecution of drug-related criminal activity
in and around low-income housing.

CRS-10
Ten million dollars of the amount appropriated for Drug Elimination Grants is
also set-aside for the Office of the Inspector General for the Operation Safe Home
Program.
Development Funding: The Growing Use of Set-Asides. Conferees agreed
to increase the Community Development Block Grant (CDBG) program’s overall
funding by $75 million or 1.6% above the $4.6 billion recommended in House and
Senate-passed versions of H.R. 2158. This is the same amount requested by the
President. This modest increase in overall appropriations is intended, in the words
of the conference report: “to avert decreases in funding allocations that may be caused
by the increased number of set asides.” The conference agreement would set-aside
10.3% or $479.8 million for various activities and projects. The amount of the set-
asides recommended by the conference committee is substantially higher than the
amount requested by the President or recommended in House and Senate-passed
versions of H.R. 2158. In addition, despite this increase in funding the overall amount
available for allocation to entitlement communities and states will decrease by 2.7%
below the FY1997 allocation amount. Under the conference agreement, after funds
are set-aside for various activities, $4.195 billion will be available for allocation to
entitlement communities and states. This is $115.2 million less than was available for
allocation in FY1997. In addition, the conference committee’s $479.8 million set-
aside is $190 million more than the $289.6 million that was set-aside under the
program in FY1997.

The President requested that $289.6 million in CDBG funds be set-aside to aid
states and communities in their implementation of welfare reform, home ownership
initiatives, economic development, crime reduction in public and assisted housing,
lead-based paint reduction, capacity building, and special purpose activities. This is
$6.3% of the President’s CDBG budget request of $4.6 billion, the same overall
amount appropriated for the program in FY1997 and recommended by the House and
Senate. The House-passed version of H.R. 2158 contains $314 million in set-asides
or 6.8% of the proposed total appropriation for CDBG activities. The total amount
recommended by the Senate for various set-asides is $349.6 million. This is 7.6% of
the proposed $4.6 billion in total CDBG appropriations
The largest CDBG set-aside recommended by the conferees is the Economic
Development Initiative, which was not funded in FY1997. The conference agreement
recommends a set-aside of $138 million for Economic Development Initiative (EDI)
grants. This is the substantially higher than the $50 million recommended by the
House and requested by the Administration or the $40 million recommended by the
Senate. In addition, $100 million of the EDI set-aside has been earmarked for 119
specific projects identified in the conference report (H.Rept. 105-297.) Further, the
conference agreement includes $67 million for Indian tribes, as requested by the
Administration. This is the same amount recommended by the House and Senate.
The conference committee bill includes $55 million for public housing supportive
services. This is $5 million more than recommended by the House. The Senate bill
did not provide a set aside for this program. The conferees, in concurrence with the
Senate bill, approved a $35 million set-aside for Youthbuild activities. The
Administration requested a separate appropriation of $30 million for the program
while the House recommended a CDBG set-aside of $30 million. The conference
agreement also includes a $32 million set-aside for Section 107 Special Purpose

CRS-11
grants. This is more than the $30 million recommended by the Senate and the $25
million recommended by the House, but slightly less than the $32.6 million requested
by the Administration.
The conferees approved a number of new set-asides under CDBG including:
$25 million for a new Neighborhood Initiative Program that will test whether housing
benefits can be integrated more effectively with welfare reform; $15 million for a
capacity building for community development and affordable housing program; and
$25 million for a job creation and economic development program targeted at rural
and tribal areas. The conferees also recommended a $60 million set-aside for lead-
based paint reduction efforts and $16.7 million for a Habitat for Humanity-linked
housing program.

The conference committee rejected a number of CDBG set-asides that were
requested by the Administration, recommended in House or Senate versions of H.R.
2158, or received funding in FY1997. These included: the Tenant Opportunity
Program, which received $5 million in FY1997, but in FY1998 may be funded with
a $5 million set-aside under the Public Housing Capital Fund account; community
development integrated management information system, which will be funded with
a $14 million set-aside under the HOME program; a public housing crime initiative
that received $20 million in CDBG funds in FY1997, but may be financed with a $20
million set-aside under a proposed appropriation of $310 million for the Drug
Elimination Grants for Low Income Housing program; and the Administration’s
Homeownership Zone initiative, which would have been funded with a $50 million
set-aside of CDBG funds. The conference committee provided modest funding of $5
million for another Administration initiative.— empowerment zones and enterprise
communities. These funds would be used to improve planning and implementation
efforts in the zones and would be funded under a separate appropriation. The
conference committee rejected the Administration’s $100 million request to fund
additional zones. The Senate version of the bill would have provided $25 million
under a separate appropriation for empowerment zone activities.
The CDBG program provides the 50 states, Indian tribes, and approximately 975
entitlement communities with flexible funding to rehabilitate homes, improve
infrastructure, provide job training activities, support energy conservation and historic
preservation, and promote neighborhood revitalization, economic development and
job creation activities. Of the amount remaining after proposed set-asides for
distribution to the program’s core recipients, 70% would be allocated to so called
“entitlement communities” and 30% to states for distribution to small nonentitlement
communities. The net effect of an increase in the amount of set-asides recommended
by the conferees will be a modest decrease of about 2.7% in the program’s funds
available for allocation to its core recipients. For additional information on CDBG
see CRS Report 96-503, Community Development Block Grants: An Overview.
Expanding Affordable Housing for Persons with Special Needs. Included
in this section are the President’s requests for funding for three programs: Housing
Opportunities for Persons with AIDS (HOPWA), Homeless Assistance Grants, and
Housing for Special Populations (the elderly and disabled).

CRS-12
Housing Opportunities for Persons with AIDS. For FY1998, the President
requested that the HOPWA program be funded with an appropriation of $204 million,
an 19% increase over the FY1997 appropriation of $171 million.
As passed by the House and Senate, H.R. 2158 appropriates $204 million for
HOPWA in FY1998. The bill further provides that the Secretary of HUD may
designate grants to one or more nonprofit organizations that provide meals to
homebound persons with AIDS. These grants are to be given on a competitive basis,
but are not to exceed $250,000 per grant.
While in conference on H.R. 2158, the House and Senate agreed that there are
problems with the existing formula for funding the HOPWA program, which can
result in a loss of funds to a state when the incidence of AIDS in a large city or
metropolitan area increases. In this final version of the bill, administrative provisions
recommend improvements to the HOPWA program.
Homeless Assistance Grants. The President requested, and both the House and
Senate bills recommended $823 million for Homeless Assistance Grants in FY1998,
the same level funded by Congress in FY1996 and FY1997.
The Senate had requested that all unobligated balances from programs designed
to assist the homeless be merged into one consolidated account, but this provision
was not adopted in conference. It is believed that the issue will be addressed when
a consolidated homeless assistance program is authorized and enacted.
H.R. 2158 also rescinds $6 million of funds recaptured in FY1998 for the
Supportive Housing Demonstration Program, and $4 million recaptured in FY1998
for Shelter Plus Care Program.
Housing for Special Populations. Through the Housing for Special
Populations program, HUD provides eligible nonprofit organizations with grants to
finance acquisition, rehabilitation, or construction of housing for elderly and disabled
persons. The President requested for $474 million for this program in FY1998: $300
million for housing for the elderly, and $174 million for housing for the disabled. The
Administration’s request was 44% below the FY1997 funding level of $839 million
($645 for elderly, and $194 million for disabled persons).
Both the House and Senate bills restored funding for housing the elderly and
disabled to their FY1997 levels. Also, in conference, the House and Senate agreed
that supportive services should be provided to tenants receiving Section 202 or
Section 811 assistance, and that funds appropriated for the Section 202 and Section
811 programs should be used in providing these services.
The bill, in its final version, also states that the Secretary of HUD may designate
up to 25% of the funding for housing the disabled to be used for vouchers and
certificates.
Native American Housing Block Grants. The Native American Housing
Block Grant program was created by the Native American Housing Assistance and
Self Determination Act of 1996 (P.L. 104-330). The Act requires that each eligible

CRS-13
Indian tribe or its designated housing entity (TDHE) receive annual block grants to
meet tribal community housing needs previously funded by several federal programs.
The Administration’s budget proposed to consolidate all current Indian housing
modernization and development, operating subsidies, homeless assistance, supportive
services, tenant opportunities, HOME investment partnership, and Section 8
programs. The budget also proposed that all balances from the Annual Contributions,
Development of Additional New Subsidized Housing, Preserving Existing Housing
Investment, HOME Investment Partnerships Program, Emergency Shelter Grants, and
Homeless Assistance Funds accounts be transferred to, and merged with the Native
American Housing Block Grant program. The Administration estimated that the
categorical programs received about $485 million in FY1997 and requested that
amount for the new block grant program in 1998. The Senate recommendation is the
same as the budget request. The Senate Committee noted its concern that the
Administration’s request may be inadequate for the program. The House raised the
funding level to $650 million. The House adopted the Administration’s consolidation
proposal. The conferees agreed to fund the program at $600 million and provide $5
million for the loan guarantee program authorized under section 601 of P.L. 104-330.
Increasing Home Ownership Opportunities. To increase home ownership
opportunities, the budget proposed modernizing the Federal Housing Administration
(FHA), creating a new, targeted home ownership program, funding home ownership
counseling, and establishing home ownership zones. The Administration’s National
Homeownership Strategy has the goal of boosting the national home ownership rate
to an all-time high of 67.5% by the year 2000. About 60 national housing
organizations are participating in the program.
HUD’s FY1998 budget requested $110 billion of loan authority for the FHA
single family home loan insurance program. The House and the Senate funded this
request. To educate consumers about the home buying process and prepare first-time
home buyers for the responsibilities of home ownership, $23 million is being requested
for home ownership counseling. The House and Senate did not fund home ownership
counseling. The House and Senate both approved a set-aside of $15 million for
housing counseling under the HOME program. This is the same amount set-aside in
FY1997.
Changes to FHA. The President proposed that the FHA loan limit for all areas
be increased to equal the loan limit for the Federal National Mortgage Association
(Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac).
Under present law FHA-insured home loans are limited to the lesser of 95% of the
median home price in the area or 60% of the Fannie Mae limit.
The Targeted Urban Ownership Initiative. Ginnie Mae is spearheading the
Targeted Urban Ownership Initiative. Under this new program, Ginnie Mae will
reduce (up to 50%), the fees it charges lenders who make loans in one of the 72
empowerment zones or enterprise communities. HUD estimates that the new
initiative will stimulate at least $1 billion in new mortgages annually to help about
15,000 families buy homes in the inner cities. A commitment limit of $130 billion for
mortgage-backed securities was proposed, $20 billion more than in FY1997.
Conferees approved this proposal.

CRS-14
The Homeownership Zone Initiative. The President’s budget requested $50
million in CDBG funds be set-aside for the Homeownership Zone Initiative. Cities
would leverage these grants with public and private investment to create large-scale
home ownership developments in abandoned and distressed areas within cities. Funds
could be used for infrastructure costs, site preparation, land acquisition, or deferred-
payment mortgages for working families. The bill does not fund this program.
Fair Housing. The HUD budget proposed $39 million for the Fair Housing
Initiatives program; the House and Senate bills approved $30 million. This program
provides funding to help fair housing organizations carry out programs that enhance
compliance with fair housing laws.
The budget also proposed $15 million for the Fair Housing Assistance program.
This program enables HUD to certify state or local fair housing agencies. The
program also reimburses the fair housing agencies for handling the fair housing cases
filed in their jurisdiction. The House bill approved the request, while the Senate bill
reduced funding to $20 million. Conferees provided $15 million.
Other Housing Finance Provisions. HUD requested authority to guarantee
up to $36.9 million in guaranteed housing loans on Indian trust lands, and $3 million
for the cost of such loan guarantees. The House bill agrees with this request. The
Senate bill approved $6 million for the cost of guaranteeing up to $73.8 million in
loans. The conferees agreed to appropriate $5 million for the cost of guaranteeing up
to $73.8 million in loans.
HUD requested and the House approved $39 million in appropriations for
research and technology, an increase of $5 million over the FY1997 level. The Senate
provided funding at the FY1997 of $34 million. The conferees agreed to provide
$36.5 million for FY1998.
The Administration proposed that a single appropriation fund the salaries and
related costs associated with administering HUD programs, except for the Office of
Inspector General, and the Office of Federal Housing Oversight. HUD requested and
the House bill approved the proposal and appropriated $1,005.8 million for salaries
and expenses, $29 million more than the FY1997 level. The Senate bill approved
$910.4 million, $95.4 million less than the budget request and $66.5 million less than
the FY1997 amount. The conferees agreed to appropriate $1,000.8 million for
salaries and expenses.
For salaries and expenses of the Office of Inspector General, the House proposed
$66.9 million and the Senate proposed $57.9 million. The conferees agreed to
appropriate $66.9 million.
For salaries and expenses of the Office of Federal Housing Enterprise Oversight,
HUD requested and the House bill approved appropriations of $16.3 million, an
$812,000 increase over the FY1997 level. The Senate bill approved funding at the
FY1997 level of 15.5 million. The conferees agreed to appropriate $16 million for
this purpose.

CRS-15
The budget requested and the conferees approved commitment authority for up
to $17.4 billion in general and special risk FHA loans; the Administration requested
and the conferees appropriated $81 million in subsidies to support loan guarantees.
HUD requested and the conferees approved $222 million in administrative expenses
of these guaranteed and direct loans.
Line Item Vetoes. President Clinton used his line item veto authority to cancel
2 projects financed through Community Development Block Grants. Canceled were
a police training facility in Arab, Alabama ($15 thousand); and a trade and
development grant intended for the Carter County, Montana Chamber of Congress
($ 1 million).
Table 6. Appropriations: Housing and Urban Development, FY1998
(budget authority in billions of $)

FY1998
H.R. 2158
Housing and Urban
FY1997
P.L.
Development
Final
Request
House
Senate
105-65
Prevention of Resident
4.640
0
0
0
0
Displacementa
Housing Certificate Funda
0
10.676
10.393
10.159
9.373
Expiring Section 8
(3.600)
(9.320)
(9.200)
(8.700)
(8.180)
contracts
Section 8 amendments
(0.850)
(0.850)
(0.950)
(1.110)
(0.850)
Section 8 relocation
(0.190)
(0.594)
(0.343)
(0.343)
(0.343)
assistance
Public housing capital fund
2.900
2.900
2.900
2.900
2.900
Public housing capital and
2.500
2.500
2.500
2.500
2.500
modernization fund
Preservation
0.350
0
0
0
0.010
Prepayment authority
0.002
0
0
0
0
Rescissions
-0.150
-0.990
-0.700
-0.135
-0.550
Drug Elimination Grants
0.290
0.290
0.290
0.290
0.310
Severe Distressed Pub.
0.550
0.524
0.524
0.550
0.550
Housing (HOPE)
Native American Block
0
0.485
0.650
0.485
0.600
Grants

CRS-16

FY1998
H.R. 2158
Housing and Urban
FY1997
P.L.
Development
Final
Request
House
Senate
105-65
Indian Housing Loan
0.003
0.003
0.003
0.006
0.005
Guarantee
Opp. for Persons with AIDS
0.171
0.204
0.204
0.204
0.204
Comm. Devlop. Blck. Grants
4.600
4.600
4.600
4.600
4.674b
Homeless Assistance Grants
0.823
0.823
0.823
0.823
0.823
HOME Invest. Partnerships
1.400
1.309
1.500
1.400
1.500
Brownfields Initiative
0
0.025
0
0
0.025
Youthbuild
0
0.030
(0.030)
(0.030)
(0.035)
Housing Counseling
0
0.023
0
0
(0.020)
Empower Zones & Econ.
0
0.100
0
0
0.005
Initiatives
FHA Credit subsidy
0.085
0.081
0.081
0.081
0.081
Hsng. for Spec. Needs Pop.
1.039
0.474
0.839
0.839
0.839
FHA Funds
0.132
0.145
0.145
0.145
0.145
Research and Technology
0.034
0.039
0.039
0.034
0.037
GNMA Funds
0.009
0.009
0.009
0.009
0.009
Enterprise Communities
0.016
0.016
0.016
0.016
0.016
Fair Housing
0.030
0.039
0.030
0.030
0.030
Inspector General
0.037
0.037
0.046
0.037
0.041
Salaries and Expenses
0.420
0.451
0.451
0.400
0.455
Offsetting receipts
-0.234
-0.220
-0.220
-0.220
-0.230
Administrative savings
-0.198
0
0
-0.317
0
Net: Rescissions & Suppl.
-3.146
0
0
0
0
Approp. of P.L. 105-18
Subtotal (HUD) (net)
16.303
24.573
25.09
24.806
24.352b
Source: H.Rept. 105-175; S.Rept. 105-53; H.Rept. 105-297; Special Line Item Veto Message,
November 1, 1997.

CRS-17
a For FY1997, Section 8 renewals, amendments, and resident relocation assistance were funded
through the Resident Displacement Prevention account; for FY1998, these programs are
funded through the Housing Certificate Fund, and from transfers from remaining reserves.

b Reflects cancellation of 2 projects ($ 1 million) by presidential line item veto
.
Environmental Protection Agency
The budget for the Environmental Protection Agency (EPA) has remained fairly
constant in recent years, requiring the agency to prioritize and optimize its resources
to address problems posing the greatest risk to human health and the environment.
Two prominent FY1998 appropriations issues were whether to significantly expand
Superfund and whether the level of assistance to states and localities is adequate. On
February 6, 1997 the President requested $7.6 billion for the EPA in FY1998; on July
16, the House approved $7.2 billion, about $440 million less than requested; and, on
July 17, the Senate recommended $7.0 billion, about $665 million less than requested.
The conferees approved $7.36 billion, a significant increase over the FY1997 funding
level of $6.8 billion and an increase over both the House and Senate versions of the
bill. While House and Senate totals would have increased funding over current year
funding for the Agency, both actions disapproved the Administration’s requested 50%
expansion of Superfund and increased funds for state assistance above the requested
level. However, in response to a belated veto threat, conferees agreed to provide
EPA with the requested additional $650 million for Superfund in FY1999 but only if
the Superfund program is reauthorized by May 15, 1998. Another key issue for
conferees was to come to agreement on the roughly $225 million difference between
the House and Senate versions of H.R. 2158.
The full FY1998 EPA Justification of Appropriation Estimates is available on-
line at: http://www.epa.gov/ocfopage. For a more in depth discussion, see CRS
Issue Brief 97019, Environmental Protection Agency: FY1998 Budget.
Beginning in FY1996, the appropriations committees established a new account
structure for EPA. For the Science and Technology account, the FY1998 budget
requested $614 million, as well as a $40 million transfer from the Superfund program.
The House Committee recommended $656 million, $42 million more than requested,
but proposed lowering the transfer from the Superfund to $35 million. On the floor,
an amendment was approved reducing the committee recommendation by $27 million
to $629 million. The Senate Committee on Appropriations recommended, and the
Senate approved, $600 million and the $35 million transfer from Superfund. Increases
in both the House and Senate would be directed to new health effects research
related to particulate matter (PM) and ozone; there has been significant controversy
and congressional interest in EPA’s promulgation of new ozone and PM air quality
standards, promulgated July 18. The conferees recommended $631 million for the
Science and Technology account, including $49.6 million for a PM research program
and health effects research plan. For further information on the new EPA regulation,
please see CRS Issue Brief 95034, Clean Air Issues.
Regulatory and standard setting activities, funded through the Environmental
Programs and Management Account, are the core of the Agency’s activities. The
Administration’s budget sought $1.9 billion, about 8% more than current year

CRS-18
funding; the House passed $1.8 billion and the Senate roughly the same. The
conferees approved $1.8 billion.

Of the media (air, water, etc.) programs funded through that account, all but the
radiation program would receive increases under the President’s budget; the exact
amounts of the House and Senate recommendations for specific media programs are
not available because major discretionary reductions are to be decided later by the
EPA Administrator. Both actions include numerous recommendations for remixing
the allocations within this account.

! The budget requested $313 million for air quality programs, $60 million, or
24%, more than current year funding.
! The water quality program and the pesticide program would increase
marginally.
! The budget requested a 10% increase in the drinking water program, directed
to new responsibilities under the 1996 Safe Drinking Water Act Amendments.
! The budget requested $497 million for EPA’s management and support of
these programs, an increase of 3%.
! Because EPA’s programs have been increasingly viewed as crossing many
media, the Administration requested $307 million for Multi-Media programs,
an increase of 12%.
How the Agency is pursuing alternative strategies for implementing and
managing its many regulatory programs is of major interest. The Agency has
embarked on numerous regulatory reinvention activities as well as innovative
alternatives to its traditional ways of doing things. These include special partnerships
with businesses, states and communities and special focus on small businesses.
The Agency’s progress in cleaning up toxic waste sites and its efficiency in
managing the Superfund program remains a prime appropriation issue. The FY1998
proposal sought a 50% increase to accelerate cleanup, while congressional
authorization committees are considering reform legislation. The GAO has continued
to place the Superfund program as a high risk for fraud, waste and abuse; many
Members are reluctant to grant significant increases in the absence of program
reforms. Please see CRS Issue Brief 97025, Superfund Reauthorization Issues.
To clean up toxic waste sites under the Superfund program, the budget proposal
sought $2.0 billion, $706 million or 52% more than current year funding; the House
did not approve the request, recommending $1.5 billion, $589 million less than
requested. The request had reflected the program’s increased emphasis on actual
cleanup work at sites. The Senate also did not approve the Superfund request; it
recommended $1.4 billion. However, as noted, conferees agreed to provide EPA with
the requested additional $650 million for Superfund in FY1999, contingent on
reauthorization of the Superfund program by May 15, 1998. The House, Senate, and
conferees approved the Administration’s $85 million request for the Brownfields
program to clean up low level toxic waste sites with economic development potential,
but prohibited the use of Brownfields monies for revolving loan funds unless
specifically authorized in subsequent legislation. For the Leaking Underground Stor-
age Tank Fund, the budget sought $71 million; the House recommended $60 million;
the Senate $65 million. Conferees recommended $65 million.

CRS-19
Another issue is how to meet the significant capital requirements of states and
localities needing to build and maintain wastewater and drinking water facilities. To
assist states and tribal governments, the budget sought $2.8 billion, 4% less than
current year funding; the House recommended $3.0 billion, about $226 million more
than requested. The Senate approved $3.1 billion, and the conferees increased the
assistance to states and tribes to $3.2 billion. The request included about $1.1 billion
for Clean Water State Revolving funds (CWSRFs), $725 million for the newly estab-
lished (P.L. 104-182) Drinking Water State Revolving Funds (DWSRFs), $715 mil-
lion for state and tribal grants, $113 million for special needs grants, $100 million for
the U.S.-Mexico Border Program, $50 million for Texas colonias water and
wastewater needs, and $15 million for rural Alaska water and wastewater needs. The
House and Senate recommended changes in the various allocations within this
account; conferees approved $1.35 billion for CWSRFs, $725 million for DWSRFs,
$745 million for state and tribal grants, $253 million for special needs infrastructure
grants, $75 million for the U.S.-Mexico Border Program, $50 million for Texas
colonias, and $15 million for rural Alaska water and wastewater needs. Please see
CRS Report 96-910, Clean Water Issues in the 105th Congress.
House and Senate versions of H.R. 2158 differed in proposed funding for
buildings and facilities. The House proposed $182 million, the Senate roughly $19
million, declining to provide $122 million for continued funding of the construction
of a consolidated research facility in Research Triangle Park, North Carolina. The
conferees approved $109 million for this account, including $90 million for the new
facility. Conferees also included bill language which raises the authorized
construction cost ceiling for this project to $273 million, but directed EPA to provide
a cost/benefit analysis justifying the inclusion of certain facilities in the original
construction plan prior to expenditure of funds for those facilities.
The House passed an amendment to H.R. 2158 which would prohibit EPA from
allowing the import of polychlorinated biphenyls (PCBs) from Canada and Mexico for
treatment and destruction in the United States. The Senate did not include such an
amendment. In July, 1997, the U.S. Ninth Circuit Court of Appeals overturned an
EPA rule permitting the import of PCBs for disposal. EPA responded by prohibiting
PCB imports, and the conferees took no further action on this issue.
The Senate adopted an amendment to fund the Chemical Safety Board, an
independent board for investigating chemical accidents authorized under the 1990
Clean Air Act Amendments; a similar amendment was withdrawn in the House. The
conferees agreed to fund the Board at a level of $4 million for FY1998.
Table 7. Environmental Protection Agency Appropriations,
FY1994 to FY1998
(budget authority in billions of current $)
FY1994
FY1995
FY1996
FY1997
FY1998
$6.7
$6.7
$6.5
$6.8
$7.4
Source: House Appropriations, Subcommittee on VA, HUD, and Independent Agencies.

CRS-20
Line Item Veto. President Clinton, using his line item veto authority, canceled
3 projects, totaling $2 million in spending reductions for FY1998. Canceled were the
Solar Aquatic Waste Treatment Demonstration Project in Vermont ($600 thousand);
the Alabama Water and Wastewater Institute, a training facility ($1 million); and a
Wastewater and Drinking Water System in an industrial park in Pennsylvania ($500
thousand). In justifying the first two vetoes, the President cited the fact that they
were not requested in his budget, were earmarked for specific purpose, and not
prioritized. In vetoing the third item, funding for McConnellsburg, PA industrial park
sewer lines, the President thought the funding was for a private entity and outside the
scope of EPA programs.
Table 8. Appropriations: Environmental Protection Agency, FY1998
(budget authority in billions of $)

FY1998
H.R. 2158
Environmental Protection
FY1997
P.L.
Agency
Final
Request
House
Senate
105-65
Science and Technology
0.552
0.614
0.629
0.600
0.631
Transfer from Hazardous
Substance Superfund
0.035
0.039
0.035
0.035
0.035
Environmental Programs
and Compliance
(Management)
1.752
1.888
1.771
1.805
1.800a
Office of Inspector General
0.040
0.040
0.040
0.040
0.040
Buildings and Facilities
0.087
0.141
0.182
0.019
0.109
Superfund (net, after
1.348
2.043
1.454
1.400
1.500
transfers)
Leaking Underground
Storage Tank Trust Fund
0.059
0.071
0.060
0.065
0.065
Oil Spill Response
0.015
0.015
0.015
0.015
0.015
State and Tribal Assistance
2.910
2.793
3.026
3.047
3.213
Subtotal (EPA)
6.799
7.645
7.205
6.976
7.363a,b

a Does not include $650 million in appropriated spending authority for the Superfund program
which cannot be obligated until FY1999, and which is dependent upon Superfund reauthorization
by May 15, 1998.
b Incorporates effect of $2 million in vetoed funds for 3 projects.
Source: H.Rept. 105-175; S.Rept. 105-53; H.Rept. 105-297; Special Line Item Veto Message,
November 1, 1997.

CRS-21
Federal Emergency Management Agency
The Federal Emergency Management Agency (FEMA), an independent agency,
has principal, but not sole, responsibility for administering federal disaster assistance
policies. FEMA loans, grants, and technical assistance are made available to states,
localities, and individuals for planning and loss control activities before disasters
strike. After disasters have occurred, resources are provided to help save lives and
protect property (the response phase) and to rebuild communities (recovery).
Concern with the cost of federal disaster assistance and the absence of affordable
private insurance in certain regions has led some to reexamine current policies and
consider alternatives. One policy option is to expand the availability of
property/casualty insurance policies through legislative action in the 105 Congress,
th
such as H.R. 219 (a bill to provide federal reinsurance for state programs that provide
insurance for property in peril to natural hazards) or H.R. 230 (a bill to expand the
availability of natural disaster insurance). Also, pursuant to investigations conducted
by leadership task forces in the House and the Senate during the 103rd Congress,
policy options have been considered to reduce federal expenditures. To this end, the
104
th Congress required that FEMA report to the 105th Congress on possible ways to
reduce federal costs. Legislation (S. 1007) has been introduced (by request) pursuant
to this mandate. The Senate had proposed eliminating funding for the replacement
of natural features (including trees) on public property, or the restoration of damaged
facilities that derive revenue from admission fees. Conferees rejected the Senate
proposal.
For FY1998 the Administration proposed the establishment of a contingency
fund, to be appropriated to the President, for disaster relief activities carried out by
FEMA and other federal agencies. As proposed, Congress would designate funding
as emergency spending under the Deficit Control Act of 1985. The funds would only
be available, however, when: (1) the President designates part or all of the funding
as an emergency requirement and (2) 15 days elapse from the time the President
notifies Congress of such a designation. Congress has not acted on this request.
One issue related to the proposal to establish a contingency fund is whether
congressional control would be ceded to the President. It may be argued that funds,
as needed, should be requested from the Congress through supplemental
appropriations, the process followed to date. (See CRS Report 97-159, FEMA and
Disaster Relief, for historical information on such supplementals.) Others may
contend that, rather than relying on supplementals, the President should have the
flexibility to make already appropriated funds available for obligation when needed.
Following the floods in North and South Dakota in 1997, Congress agreed to provide
FEMA a supplemental appropriation of $3.3 billion for FY1997 (P.L. 105-18).

CRS-22
Table 9. Appropriations: Federal Emergency Management Agency,
FY1998
(budget authority in billions of $)
FY1998
H.R. 2158
Fed. Emergency Manage.
FY1997
P.L.
Agency
Final
Request
House
Senate
105-65
Disaster Relief Fund
1.320
.370
.500
.320
.320
Supplemental (P.L. 105-18)
3.300
—
—
—
—
Salaries and Expenses
0.171
0.172
0.172
0.172
0.172
Emergency Management and
0.219
0.202
0.262
0.207
0.244
Planninga
Disaster Loan Subsidy
0.002
0.002
0.002
0.002
0.002
Inspector General
0.005
0.005
0.005
0.005
0.005
Emergency Food and Shelter
0.100
0.100
0.100
0.100
0.100
Subtotalb (FEMA)
5.104
0.839
1.028
0.789
0.806
Source: H.Rept. 105-175; S.Rept. 105-53; H.Rept. 105-297.

a The House proposed $50 million for predisaster mitigation grants; the Senate proposed $5 million;
conferees approved $30 million.
b Does not include request for spending authority for the following loan accounts or fee for service
accounts: Working Capital Fund, Direct Loan Financing Account, National Insurance Development
Fund, National Flood Insurance Fund, and National Flood Mitigation Fund.
National Aeronautics and Space Administration
Conferees approved $13.648 billion for the National Aeronautics and Space
Administration (NASA), a decrease of $61 million from FY1997, but $148 million
more than the $13.5 billion requested. This is the same level as was approved by the
House; the Senate had recommended the request level. President Clinton reduced
total NASA spending by $10 million dollars by exercising his line item veto authority
to cancel spending for 2 planned telescopes.
The conferees added $230 million dollars to the International Space Station
(ISS) request for a total of $2.351 billion. The $230 million is comprised of $100 in
additional funding, $50 million from the space shuttle request, and $80 million from
the request for Mission Support activities. In September, NASA announced a $600
million cost overrun for ISS and that it needs $430 million more than it expected in
FY1998 for the program. The recommended appropriation is $200 million less than
NASA says it needs to keep the space station on schedule. The bill does not provide
transfer authority from other agency appropriation accounts to cover the shortfall.
In report language, conferees also fenced $851.3 million of the ISS funding until after

CRS-23
March 31, 1998, requiring NASA first to submit a FY1999 budget plan showing that
shifting funding to the space station will not hurt other NASA programs and other
information relating to cost and schedule issues.
The bill also adds $48 million to the request for Science, Aeronautics, and
Technology (SAT) programs. Conference report language directs $116 million in
several earmarks for SAT programs. If NASA funds those earmarks, the agency will
have to find $68 million in offsets from other SAT programs since only $48 million
was added to the request.
Table 10. National Aeronautics and Space Administration
Appropriations, FY1994 to FY1998
(budget authority in billions of current $)
FY1994
FY1995
FY1996
FY1997
FY1998
$14.55
$14.00
$13.88
$13.71
$13.64
Source: House Appropriations, Subcommittee on VA, HUD and Independent Agencies.
Many in Congress find the space station cost overruns troubling, particularly
with the prospect for future declines in NASA’s budget. Although not set in law,
Congress and the White House had agreed to cap space station funding at $2.1 billion
annually, and $17.4 billion total from FY1994 to completion of assembly. This was
done to add stability to the program and limit the amount of funds that went to ISS
versus other NASA programs. Concerns about Russia’s ability to fulfill its
commitment to the program and the recent cost overruns have caused Congress and
the White House to abandon the cost caps. The concern of many in Congress is that,
in a declining budget environment, shifting additional funding to the space station
would come at the expense of other NASA programs.
This concern is amplified by prospects for lower agency budgets in the outyears.
The FY1998 request had an outyear FY1999 level of $13.2 billion. Press reports
indicate that the agency’s budget request in FY1999 might be as low as $12.6 billion.
Many agency observers question whether NASA, in a declining budget atmosphere,
can continue to fund new programs and initiatives let alone fund all ongoing
programs. Space station cost overruns and reports of lower than expected outyear
budgets adds further credence to those concerns. NASA asserts that its budget does
fund a balanced program and that efforts to undertake its missions “faster, cheaper,
and better” have allowed the agency to increase the number of science missions even
with a declining budget. NASA Administrator Dan Goldin has committed publicly to
maintain a funding balance among the agency’s science, technology, aeronautics, and
human spaceflight.
Line Item Veto. President Clinton canceled 2 NASA projects, the construction
of optical telescopes in Arizona and Chile. FY1998 savings from the cancellations
total $10 million.

CRS-24
Table 11. Appropriations: National Aeronautics and Space
Administration, FY1998
(budget authority in billions of $)

FY1998
H.R. 2158
Nat’l Aeronautics &
FY1997
P.L.
Space Admin.
Final
Request
House
Senate
105-65
Human Space Flight
5.675
5.326
5.427
5.327
5.506
Science, Aeronautics and
5.453
5.642
5.690
5.642
5.680a
Technology
Mission Support
2.564
2.513
2.513
2.513
2.433
Inspector General
0.017
0.018
0.018
0.018
0.018
Subtotal (NASA)
13.709
13.500
13.648
13.500
13.638a
Source: H.Rept. 105-175; S.Rept. 105-53; H.Rept. 105-297; Special Line Item Veto Message,
November 1, 1997.
Reflects $10 million in projects canceled by presidential line item veto.
a
National Science Foundation
The Administration’s FY1998 budget requested $3.4 billion for the National
Science Foundation (NSF), a 3% ($97 million) increase over FY1997. (The FY1997
estimate excludes a carryover of $32.8 million.) The House Committee approved
$120 million more than the request, with the additional amount for the Research and
Related Activities (R&RA), and Major Research Equipment (MRE) accounts.
In House floor action, $174,000 in research funding was removed from the bill
before passage, as several Members expressed concerns about a research project that
sought information on the decisionmaking process of individuals thinking of running
for Congress. The Senate approved funding for NSF at a level $10 million above the
Administration request, with the increase also earmarked for the R&RA account.
Table 12. National Science Foundation Appropriations,
FY1994 to FY1998
(budget authority in billions of current $)
FY1994
FY1995
FY1996
FY1997
FY1998
$2.99
$3.23
$3.22
$3.27
$3.43
Source: House Appropriations, Subcommittee on VA, HUD, and Independent Agencies.

CRS-25
Conferees recommended $3.429 billion for the NSF, $159 million (4.9%) more
than the FY1997 estimate and $62 million (1.8%) above the FY1998 request.
Included in the total is $2.546 billion for the R&RA, $114 million above the FY1997
level and $31.3 million above the Administration’s request. Conferees directed that
in FY1998, $23 million be used to support NSF activities in the interagency Next
Generation Internet program. The MRE was recommended funding at $109 million,
$29 million above the FY1997 estimate and $24 million more than the FY1998
request. Of the recommended funding for the MRE, $70 million is to be directed
toward necessary improvements at the South Pole Station. In addition, conferees
recommended $632.5 million for the EHR, $13.5 million above the FY1997 estimate
and $7 million above the FY1998 request.
The Administration had requested $2.5 billion for R&RA, a 3.4% ($82.7 million)
increase over the FY1997 estimate of $2.4 billion. Neal F. Lane, Director of NSF,
stated that this level of support is indicative of the Administration’s emphasis on
giving priority to merit-based research and to the support of the academic enterprise.
Of the total FY1998 request for NSF, approximately 56% supports science and
engineering research; 20% supports education and training; 20% supports research
facilities; and 4% supports administration and management.
The FY1998 request includes significant investments in several emerging areas:
knowledge and distributed intelligence (KDI), integration of research and education,
and life and earth’s environment. The KDI supports, among other things, the next
generation internet, a multi-agency effort. Administration’s request for KDI is $58
million. Another emerging area, the integration of research and education effort, a
key theme of NSF’s strategic plan, includes such programs as Grant Opportunities for
Academic Liaison with Industry ($30 million) and the Faculty Early Career
Development program ($82 million). And the Earth’s Environment Activity, with
total funding of approximately $35 million, focuses on the interaction of living
organisms and their environment and the use of bioremediation and bioprocessing.
The MRE account, for which the Administration proposed $85 million for in
FY1998 (6.3% above the FY1997 estimate), supports the construction of major
research facilities that are at the “cutting edge of science and engineering.” Four
projects are supported by this account, two existing projects, the Laser Interferometer
Gravitational Wave Observatory (LIGO) and the South Pole Station, and two new
projects, the Polar Cap Observatory and the Millimeter Array. The Polar Cap
Observatory, proposed at $25 million and to be constructed near the Earth’s magnetic
pole, would track a number of phenomena in the atmosphere and ionosphere. The
Millimeter Array would be the world’s most sensitive, highest resolution, millimeter-
wavelength telescope. The request provides $9 million for the design and
development phase of this project. In addition, the Administration proposed that $26
million in MRE funds be used to complete funding LIGO, and $25 million to begin
modernizing the South Pole Station research facility. (The South Pole Safety Project
was fully funded in FY1997.) The House Committee bill recommends $90 million
more in funds for maintenance and construction of facilities in Antarctica.
Research project support in the FY1998 request totals $1.9 billion, a 2.7%
increase over the FY1997 estimate. Support is provided individuals and small groups
conducting both disciplinary and cross-disciplinary research. Included in that total are

CRS-26
funds for Engineering Research Centers (ERC), proposed at $204 million in the
FY1998 request, approximately 1% below the FY1997 estimate. It is anticipated that
three to four ERCs, of the six centers originally proposed, will be initiated, in addition
to three new Materials Research Science and Engineering Centers.
The FY1998 budget requested $625.5 million for the Education and Human
Resources Directorate (EHR), a 1% increase above FY1997, with support divided by
education level: precollege, $375 million; undergraduate, $115 million; and graduate,
$78 million. Support at the precollege level is directed primarily to systemic reform
initiatives at state, rural, urban, and school district levels, and to informal science
activities. Support at the undergraduate level is focused primarily on reform of
undergraduate education and advanced technical training. Reform of laboratory
instruction and upgrade of equipment will also continue to receive emphasis.
Increased funding at the graduate level would allow NSF to initiate an Integrative
Graduate Education and Research Training program, and to provide continued
support for the Graduate Research Fellowships and the Science Education
Postdoctoral Fellows program. Support for the Experimental Program to Stimulate
Competitive Research (EPSCoR) in the FY1998 request remains at the FY1997 level
of $38.4 million. The House approved $7 million for advanced technical education
programs, including $5 million to increase in the number of advanced degrees pursued
by under-represented minorities.
Table 13. Appropriations: National Science Foundation, FY1998
(budget authority in billions of $)

FY1998
H.R. 2158
National Science
FY1997
P.L.
Foundation
Final
Request
House
Senate
105-65
Research and Related
2.432
2.515
2.538
2.524
2.546
Activities
Education and Human
0.619
0.625
0.633
0.626
0.633
Resources
Major Research Equipment
0.080
0.085
0.175
0.085
0.109
Salaries and Expenses
0.134
0.137
0.137
0.137
0.137
Office of Inspector General
0.005
0.005
0.005
0.005
0.005
Subtotal (NSF)
3.270
3.367
3.487
3.377
3.429
Source: H.Rept. 105-175; S.Rept. 105-53; H.Rept. 105-297.
Other Independent Agencies
In addition to funding for VA, HUD, EPA, FEMA, NASA and NSF, H.R. 2158
would appropriate funding for several smaller “sundry independent agencies, boards,

CRS-27
commissions, corporations, and offices” for the fiscal year ending September 30,
1998.
American Battle Monuments Commission. This Commission is responsible
for the construction and maintenance of memorials honoring Armed Forces battle
achievements since 1917. The Administration asked for $23.9 million for FY1998,
the House approved $26.9 million, with the additional $3 million to be used to reduce
a backlog that the House Appropriations Committee perceived in equipment and
maintenance. The Senate Committee endorsed the Administration’s request.
Conferees approved the House proposed amount.
Chemical Safety and Hazard Investigation Board. The Senate bill had
proposed this Board, with no counterpart having been offered by the House.
Conferees accepted the Senate proposal, endorsing the $4 million included in the
Senate as start-up operations costs.
Community Development Financial Institution Fund. The Community
Development Financial Institutions Fund (CDFI) was created by P.L. 103-325. The
CDFI is a Clinton Administration initiative to provide credit and investment capital
to distressed urban and rural areas. The program also provides technical and training
assistance to qualifying financial institutions. The program has survived despite
attempts to eliminate it.
P.L. 104-19 modified the original Act by giving the Department of the Treasury
the authority to manage the CDFI program, although the CDFI continues to be
funded through the VA/HUD bill. The Clinton Administration requested $125 million
for the program in FY1998. This is a $75 million increase from last year’s
appropriated amount. The House bill approved the requested amounts. The Senate
provided no funding for FY1998, and requested a GAO audit on how the CDFI
program makes awards and tracks the use of awarded funds. Conferees approved $80
million, and softened the proposed GAO audit of the CDFI to a “review” of its
effectiveness.
Consumer Information Center. The Center helps federal agencies distribute
consumer information and promotes public awareness of existing federal publications.
The Administration requested $2.119 million for the Center. The House-passed bill
adds $300,000 to the Administration’s request, but also transfers to the Center the
functions of the Office of Consumer Affairs, currently administered through the
Department of Health and Human Services. The House bill then provides no funding
for the office, for which the Administration had requested $1.8 million. The Senate
agrees with the House bill; so did conferees.
Consumer Product Safety Commission. This Commission is an independent
regulatory agency charged with protecting the public from unreasonable product risk
and to research and develop uniform safety standards for consumer products. The
House bill approved $44 million for the Commission’s work, $1 million less than
requested by the Administration. The Senate approved the Administration request.
Conferees approved $45 million as originally requested.

CRS-28
Corporation for National and Community Service (CNCS). The key issue
concerning the Corporation, a program strongly supported by President Clinton, has
been budgetary survival. The largest program of the Corporation is AmeriCorps.
Congressional inquiries have raised concerns about partisan activities, program costs,
financial management issues, and whether government should support a paid
“volunteer” program. Congress voted during the FY1996 and FY1997 appropriation
process to eliminate funding for the Corporation’s programs under VA/HUD, but
funds were eventually restored for both years. The Corporation’s final VA/HUD
appropriation for FY1997 was $402.5, roughly the same as provided for FY1996. Of
the FY1997 appropriation, $2 million was used for expenses of the Corporation’s
Inspector General’s Office.
The President requested $549 million for FY1998 for the Corporation’s
programs funded through VA-HUD, including $2.5 million for the Inspector General.
The request also earmarked $162.0 million for the “America Reads” program. This
new national service initiative proposes to recruit and train volunteer tutors in an
effort to insure that all school children read at their grade level by the third grade.
The House bill does not provide earmarked funds for the America Reads program but
would not forbid the Corporation from using funds for that program. The House
Committee recommended a funding level equal to FY1997, $147 million below the
President’s request. A House floor amendment reduced the amount by $200 million
for a final House total of $200.5 million.
The Senate funded the program at FY1997 the level, $400.5 million. A floor
amendment earmarked $20 million of the funds for the America Reads program. The
House bill provides $2 million for the Corporation’s Office of the Inspector General,
the Senate approved $3 million.
Conferees agreed to fund the program at higher levels than proposed in the bills
approved by either House, increasing CNCS funding by $25 million over FY1997.
Some additional amounts are to be used for educational grants, including $10 million
specifically earmarked for high school students performing community service.
Grants for AmeriCorps were increased to $227 million from the $201 proposed by the
House and the $215 million proposed by the Senate. The conferees did not approve
specific amounts for America Reads, but included $25 million for “literacy and
mentoring activities.” Conferees also approved $3 million for the Corporation’s
Inspector General.
Council on Environmental Quality; Office of Environmental Quality.
These two entities are administered by the Executive Office of the President. The
Council is responsible for oversight and coordination of interagency decisions in
matters affecting the environment; the Office provides the professional and
administrative staff for the Council. The Administration requested $3.02 million for
the functions of the Council and the Office, and the House bill approved a decrease
of $514,000, expressing the House Appropriations Committee’s concerns about an
American Heritage Rivers initiative. The Senate funded the activity at the FY1997
level, $2.436 million, $70,000 less than the House bill. Conferees approved $2.5
million. In addition, conferees agreed to a special one-time $1 million appropriation
to the Executive Office of the President for “unanticipated needs.” The funds had
been requested by the President but excluded from another appropriation.

CRS-29
Neighborhood Reinvestment Corporation (NRC). The NRC leverages funds
for reinvestment in older neighborhoods through community-based organizations
called NeighborWorks. Among projects supported by the financing activities of the
NRC are lending activities for home ownership of low-income families. The House
bill provides $70 million for the NRC, $20 million more than requested by the
Administration. The Senate approved the Administration’s request. Conferees
compromised at $60 million.
Selective Service System (SSS). The SSS was originally created to supply
manpower to the U.S. Armed Forces during time of national emergency. Although
since 1973, the the Armed Forces has been on voluntary recruitment and incentives,
the SSS remains the primary vehicle for conscription should it become necessary. In
1987, the SSS was given the task of developing a postmobilization health care system
that would assist with providing the Armed Forces with health care personnel in time
of emergency. The Administration requested $24 million for this office for FY1998;
both Chambers approved bills at a level $.5 million less than requested. Conferees
approved that amount.
The remaining appropriation accounts in the bill are for certain national cemetery
expenses, the Court of Veterans Appeals, the Federal Deposit Insurance Corporation,
the National Credit Union Administration, and the Office of Science and Technology
Policy. With the exception that the House bill provides $1,000 less than requested for
the Court of Veterans Appeals, these remaining entities are funded by both the House
and Senate bills at the levels requested by the Administration. Conferees approved
the agreed amounts, and accepted the House proposed amount for the Court of
Veterans Appeals.
Table 14. Appropriations: Other Independent Agencies, FY1998
(budget authority in billions of $)

FY1998
H.R. 2158
Other Independent
FY1997
P.L.
Agencies
Final
Request
House
Senate
105-65
American Battlefield
Monuments Commission
0.022
0.024
0.027
0.024
0.027
Chemical Safety and
Hazard Investigations
—-
—-
—-
0.004
0.004
Board
Cemetery Expenses,
0.012
0.012
0.012
0.012
0.012
Army
Community Development
Financial
Institution Fund
0.050
0.125
0.125
0
0.080
Consumer Information
0.002
0.002
0.002
0.002
0.002
Center

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FY1998
H.R. 2158
Other Independent
FY1997
P.L.
Agencies
Final
Request
House
Senate
105-65
Consumer Product Safety
Commission
0.043
0.045
0.044
0.045
0.045
Corporation for National
and Community Servicea
0.403
0.549
0.203
0.403
0.428
Council on Environmental
0.002
0.003
0.003
0.002
0.003
Quality
Court of Veterans Affairs
0.009
0.009
0.009
0.009
0.009
Federal Deposit Insurance
Corporation
0
(0.034)
(0.034)
(0.034)
(0.034)
National Credit Union
0.001
0
0
0
0
Administration
Neighborhood
Reinvestment Corporation
0.050
0.050
0.070
0.050
0.060
Office of Consumer
0.002
0.002
0
0
0
Affairs
Office of Science and
Technology Policy
0.005
0.005
0.005
0.005
0.005
Selective Service System
0.023
0.024
0.023
0.023
0.023
Subtotal, Other
Independent Agencies
0.624
0.850
0.523
0.580
0.698
a Totals include amounts for CNCS Office of the Inspector General.
Source: H.Rept. 105-175; S.Rept. 105-53; H.Rept. 105-297.
Supplemental Appropriations (P.L. 105-18)
On June 12, 1997, President Clinton signed the proposal for supplemental
appropriations and rescissions to the budget of FY1997. P.L. 105-18 provided $3.3
billion in emergency appropriations to FEMA for disaster relief to meet needs created
by recent natural disasters such as tornadoes and flooding.
The supplemental appropriations provided an additional $928 million to VA for
costs incurred for cost-of-living adjustments to disability compensation payments, for
reestimates of caseloads under that program and the program providing pensions for
low-income, totally-disabled wartime veterans, and to the survivors of veteran
beneficiaries of both programs.

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P.L. 105-18 also transferred $30 million from HUD’s HOPE grant fund to its
program of Drug Elimination Grants. The HOPE grant fund is used to improve
HUD-held properties, and in recent years, use of this program has been decreasing.
Drug elimination grants have increased in recent years to combat drug-related and
other crime prevention activities in federally assisted low-income housing areas.
The Act rescinded $325 million in FY1997 funds from the assisted housing
programs of HUD. P.L. 105-18 rescinds $250 million from the recapture of excess
funds available from some long-term Section 8 contracts and other inactive housing
programs. In addition $25 million was transferred to the Housing Opportunities for
Persons with AIDS (HOPWA) program, and $50 million was transferred to the
housing preservation program.
P.L. 104-208 (H.R. 3610) the Omnibus FY1997 Appropriations Act included
$87.2 in additional funds for EPA, including $10 million more for the science and
technology account, $42.2 million more for programs and management, and $35
million more for state and tribal assistance.
For Additional Reading
CRS Issue Briefs
CRS Issue Brief 97007. Clean Air Act Issues, by James McCarthy.
CRS Issue Brief 97019. Environmental Protection Agency: FY1998 Budget, by
Martin Lee.
CRS Issue Brief 97023. Research and Development Funding: Fiscal Year
1998, by Michael E. Davey, Coordinator.
CRS Issue Brief 93062. Space Launch Vehicles: Government Requirements and
Commercial Competition, by David Radzanowski and Marcia S. Smith.
CRS Issue Brief 93017. Space Stations, by Marcia S. Smith.
CRS Issue Brief 97025. Superfund Reauthorization Issues in the 105th Congress,
by Mark Reisch.
CRS Reports
CRS Report 97-8. Air Quality: EPA’s Proposed New Ozone and Particulate Matter
Standards, by John Blodgett and James McCarthy.
CRS Report 96-503. Community Development Block Grants: An Overview, by
Eugene Boyd.

CRS-32
CRS Report 97-126. Federal Research and Development Funding Trends in Five
Agencies: NSF, NASA, NIST, DOE (Civilian) and NOAA, by Michael E. Davey,
Coordinator.
CRS Report 97-159. FEMA and Disaster Relief, by Keith Bea.
CRS Report 97-169. Housing Issues in the 105th Congress, by Richard Bourdon.

CRS Report 96-791. Low-Income Homeowners Initiatives and Default Risk, by
Richard Bourdon.
CRS Report 95-336. The National Aeronautics and Space Administration: An
Overview with FY1997 and FY1998 Budget Summaries, by David Radzanowski.
CRS Report 95-897. National Science Foundation, Directorate for Social,
Behavioral, and Economic Sciences- A Fact Sheet, by Christine M. Matthews.

CRS Report 97-264. The Problem of Section 8 Expiring Contracts, by Susan M.
Vanhorenbeck.
CRS Report 96-667. Section 8: Past, Present, and Future, by Susan M.
Vanhorenbeck.
CRS Report 95-307. U.S. National Science Foundation: An Overview, by Christine
M. Matthews.
CRS Report 97-266. Veterans Issues in the 105th Congress, by Dennis Snook.
Selected World Wide Web Sites
Environmental Protection Agency (EPA), Summary and Justification of Budget.
http://www.epa.gov/ocfopage
Department of Housing and Urban Development (HUD).
http://www.hud.gov
Federal Emergency Management Agency (FEMA)
http://www.fema.gov
National Aeronautics and Space Administration (NASA).
http://www.hq.nasa.gov
National Aeronautics and Space Administration (NASA), Legislative Affairs.
http://www.hq.nasa.gov/office/legaff
National Science Foundation (NSF).
http://www.nsf.gov

CRS-33
Office of Management and Budget (OMB).
http://www.whitehouse.gov/WH/EOP/OMB/html/ombhome.html
Department of Veterans Affairs (VA).
http://www.va.gov