Appropriations for FY1998: Energy and Water Development

Appropriations for FY1998: Energy and Water Development

97-207 ENR
Appropriations for FY1998:
Energy and Water Development
Updated February 10, 1998
Coordinated by (name redacted) and Carl Behrens
Environment and Natural Resources Policy 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
Energy and Water Development 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:
Energy and Water Development
Summary
The Energy and Water appropriations bill includes funding for civil projects of the Army
Corps of Engineers, the Department of the Interior's Bureau of Reclamation, much of the
Department of Energy and a number of independent agencies, including the Appalachian
Regional Commission, the Nuclear Regulatory Commission and the appropriated programs
of the Tennessee Valley Authority. The Administration requested $22.3 billion for these
programs for FY1998 compared to $20 billion appropriated for FY1997 and $19.3 billion for
FY1996. A conference bill reported (H.Rept. 105-271) on September 25, 1997, agreed to
$21.2 billion.
Key issues involving the Energy and Water appropriations programs included:
! Full up-front funding for several construction projects proposed by the Bureau
of Reclamation, Army Corps of Engineers and the Department of Energy. The
Congress did not fund projects beyond the FY1998 period.
! DOE request to expand its privatization program for waste management and
cleanup.
! Spending for the nuclear technology R&D, which involves electrometallurgical
treatment of DOE spent nuclear fuel.
! The Tennessee Valley Authority request to transfer authority over its nonpower
appropriated programs and focus on its power programs in a deregulated
market, starting in FY1999. The Congress funded nonpower programs at $70
million for FY1998 and agreed to terminate funding after that.
The President signed the bill October 13. On October 17 he issued line-item vetoes on
eight projects funded by the bill: five in the Corps of Engineers, one in the Bureau of
Reclamation, and two in the Department of Energy.
Since this report was last updated, data related to FY1998 appropriations may have
changed through supplemental appropriations or rescissions, entitlement revisions, or
scorekeeping adjustments. These changes will be reflected in a subsequent report.

Key Policy Staff
Area of Expertise
Name
CRS Division
Telephone
Corps/BuRec Resources
Betsy Cody
Environment
7-....
General
(name redacted)
Environment
7-....
General
Carl Behrens
Environment
7-....
Nuclear Energy
(name redacted)
Environment
7-....
R&D Programs
Dick Rowberg
Science Policy
7-....

Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Title I: Corps of Engineers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Key Policy Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Title II: Department of the Interior . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Key Policy Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Title III: Department of Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Key Policy Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Research and Development Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Applied Energy R&D . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Basic Research Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Defense R&D Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Full Construction Cost Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Environmental Cleanup and Waste Management . . . . . . . . . . . . . . . . . . . . 9
Privatization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Other Environmental Management Funding . . . . . . . . . . . . . . . . . . . . 11
Nuclear Energy, Science and Technology . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Line-Item Veto . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Title IV: Independent Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Key Policy Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
For Additional Reading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
List of Tables
Status of FY1998 Energy and Water Development Appropriations . . . . . . . . . . . . . . . 1
Energy and Water Development Appropriations, FY1991 to FY1998 . . . . . . . . . . . . . 1
Title I: Corps of Engineers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Title II: Central Utah Project Completion Account . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Title II: Bureau of Reclamation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Title III: Department of Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Title IV: Independent Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Appropriations for FY1998:
Energy and Water Development
Most Recent Developments
The Senate Appropriations Committee reported out S. 1004 on July 10, 1997, and the
Senate approved the bill by 99-0 on July 16, 1997. The House Appropriations Committee
reported out H.R. 2203 on July 17, 1997. The House passed H.R. 2203 on July 25 by a vote
of 418-7. A conference bill was reported on September 25 and passed both House and
Senate September 30.
The President signed the bill October 13. On October 17 the President issued a line-
item veto for eight projects funded in the bill as passed.
Since this report was last updated, data related to FY1998 appropriations may have
changed through supplemental appropriations or rescissions, entitlement revisions, or
scorekeeping adjustments. These changes will be reflected in a subsequent report.
Status
Status of FY1998 Energy and Water Development Appropriations
Subcommittee
Conference Report
Markup
House
House
Senate
Senate
Conference
Approval
Public
Report
Passage
Report
Passage
Report
Law
House
Senate
House
Senate
July 25
Sept.26
Oct. 13
H.Rept.
S.Rept.
July 16 S.
July 11
July 8
H.R.
H.Rept.
Sept. 30
Sept.30
P.L.
105-190
105-44
1004
2203
105-271
105-62
Energy and Water Development Appropriations, FY1991 to FY1998
(budget authority in billions of current dollars)*
FY91
FY92
FY93
FY94
FY95
FY96
FY97
FY98
Request
20.8
21.8
22.2
22.3
20.7
19.3
19.97
22.3
*These figures represent current dollars, exclude permanent budget authorities, and reflect rescissions.
This report includes FY1998 budget request figures and budget totals for appropriations enacted for FY1991
to FY1997. The tables for Titles I, II and III provide budget details for FY1996 - FY1998.

CRS-2
Title I: Corps of Engineers
Energy and Water Development Appropriations
Title I: Corps of Engineers
(in millions of dollars)
FY1998
Senate Bill
House Bill
P.L. 105-
Program
FY1997
Request*
(S. 1004)
(H.R. 2203)
62
Investigations
153.9
150.0
164.1
157.3
156.8
Construction
1,081.9
1,323.0
1,284.3
1,475.9
1,469.1
Flood Control,
310.4
266.0
289.0
285.4
294.3
Mississippi River
Operation and
1,697.0
1,618.0
1,661.2
1,727.0
1,733.2
Maintenance
Regulatory
101.0
112.0
106.0
112.0
106.0
Flood Control and
10.0
14.0
10.0
14.0
4.0
Coastal Emergencies
Other
149.0
148.0
148.0
258.0
--
(incl.
remedial
action)
FUSRAP
--
--
--
--
140.0**
Total
3,503.2
3,631.0
3,662.6
4,026.6
3,903.4
* FY1998 budget request includes full construction funding.
**Transferred from Department of Energy, Title III.
Key Policy Issues
The funding request for the Corps of Engineers programs is $128 million over FY1997
funding. The request includes advance payments for all new starts and incremental funding
for projects scheduled to be complete in 2002. This would differ from funds appropriated
annually. Some members of Congress are concerned that the Corps is asking for all the
funding up front when in the past it has left projects incomplete. According to the Corps,
water projects have been exempt from the Office of Management and Budget requirements
to fully fund federal capital projects up front. The conference agreement provided a slight
increase over the budget request in most categories. In addition, it transferred the DOE's
Formerly Utilized Sites Remedial Action Program (FUSRAP) to the Corps' jurisdiction.
On October 17, 1997, the President issued a line-item veto for five Corps projects
funded in the bill as passed:
! Allegheny River, Kittanning, PA, extend navigation channel to a river park used
by tour boats, $6 million;
! Sardis Lake, Panola County, MS, dredging for recreational use, $1.9 million;

CRS-3
! Lake George, Hobart, IN, dredging silt and sediment for recreational and
aesthetic purposes, $3.5 million;
! Chena River, Fairbanks, AK, navigation project, $800,000;
! Neabsco Creek, Prince William County, VA, dredge sediment and debris for
flood control, $800,000.
Title II: Department of the Interior
Energy and Water Development Appropriations
Title II: Central Utah Project Completion Account
(in millions of dollars)
House
Senate
FY1998
Bill
P.L. 105-
Program
FY1997
Bill (S.
Request
(H.R.
62
1004)
2203)
Central Utah project
31.9
28.8
28.8
28.8
28.8
completion
Utah reclamation
11.7
11.6
11.6
11.6
11.6
mitigation/conservation
Program Admin.
--
.8
.8
.8
.8
Total, Central Utah Project
43.6
41.2
41.2
41.2
41.2
Energy and Water Development Appropriations
Title II: Bureau of Reclamation
(in millions of dollars)
FY1998
Senate Bill
House Bill
P.L.
Program
FY1997
Request
(S. 1004)
(H.R. 2203)
105-62
Construction
394.1
--
--
--
--
Operation and
267.9
--
--
--
--
Maintenance
General Investiga-
16.7
--
--
--
--
tions
Water and related
--
666.4
688.4
651.9
693.0
resources
California Bay-Delta
--
143.3
50.0
120.0
85.0
Loan program
12.7
10.4
10.4
10.4
10.4
account
General Admin.
46.0
47.7
47.6
47.7
47.6
Expenses

CRS-4
FY1998
Senate Bill
House Bill
P.L.
Program
FY1997
Request
(S. 1004)
(H.R. 2203)
105-62
Central Valley
38.0
39.1
33.1
39.1
33.1
Project Restoration
Fund
Total, Bureau of
775.4
906.4
829.5
869.1
869.1
Reclamation
Key Policy Issues
In the West, most of the large dams and water diversion structures were built by, or with
the assistance of, the Bureau of Reclamation (Bureau). Where the Corps has built hundreds
of flood control and navigation projects, the Bureau's mission was to develop water supplies
and to reclaim arid lands in the west, primarily for irrigation. Today, the Bureau manages
more than 600 dams in 17 western states, providing water to approximately 10 million acres
of farmland and 31 million people. The agency now views its mission as "water
management."
The Administration has asked for an appropriation of $906 million in FY1998 (current
budget authority), $131 million more than enacted for FY1997. The increase is largely due
to a $143.3 million request for the California Bay-Delta Ecosystem Restoration program
(CALFED). When this is subtracted, the request results in a decrease of $11.8 million for
ongoing programs. Although funding for the Bay-Delta program has been requested within
the Bureau's budget, the appropriation will be allocated among several federal agencies. It
is expected that the majority of funding will go to the Bureau and the Corps. The conferees
provided most of the funding requested.
The FY1998 request includes $12.2 million less than the FY1996 enacted appropriations
for "Water and Related Resources" -- a new category of funding, which combines the old
categories of construction, operation and maintenance, general investigations, and emergency
fund appropriations. The Water and Related Resources request includes $6 million for
Animas-La Plata, a controversial water supply project in southwestern Colorado.
The House approved $829 million in FY1998 budget authority, $77 million less than
requested. The Senate approved $869 million, $37 million less than requested. The House
approved $129 million for the CALFED process, whereas the Senate approved $50 million.
Both the House and the Senate supported $6 million for continuation of work on the Animas
La Plata project and state in report language that funds may be used in support of a process
initiated by the Governor of Colorado and the Secretary of the Interior to develop a new
proposal for the project. A Senate amendment to prohibit construction funding of the Animas
project until a new authorization for the project is enacted was tabled after considerable debate
by a vote of 56-42.
On October 17 the President issued a line-item veto for a $1.3 million Bureau of
Reclamation study of water reclamation technology.

CRS-5
Title III: Department of Energy
Energy and Water Development Appropriations
Title III: Department of Energy
(in millions of dollars)
Program
FY1997
FY1998
Senate Bill
House
P.L. 105-
Request*
(S.1004)
Bill (H.R.
62
2203)
Energy Supply R&D
Solar and Renewable
270.0
329.7
301.4
329.3
345.3
Nuclear Energy
222.7
330.7
244.3
228.6
243.1
Basic Energy Sciences
649.7
668.2
--
--
--
Biological & Environ. R&D
389.1
376.7
--
--
--
Fusion Energy
232.5
225.0
240.0
225.0
232.0
Environmental Restoration and Waste
591.9
684.7
--
--
--
Management (non-defense)
Other
403.2
473.4
168.2
142.1
--
Subtotal
2,759.1
3,088.4
953.9
880.7
--
(adjustments)
(48.2)
--
--
--
--
Subtotal
2,710.9
3,088.4
953.9
880.7
--
Uranium Enrichment
Enrichment Activities (Net)
1.0
--
--
--
--
Uranium Enrichment D&D
200.0
248.8
230.0
220.2
220.2
General Science
High Energy Physics
670.1
675.0
675.0
680.0
680.0
Nuclear Physics
315.9
315.9
315.9
320.9
320.9
Basic Energy Sci.
--
--
668.2
668.2
668.2
Bio. & Env. R&D
--
--
376.7
381.7
406.7
Other
10.0
11.9
187.3
156.8
173.7
Subtotal
996.0
1,002.8
2,223.1
2,207.6
--
Environ.Res. & Waste Management --
--
--
664.7
497.6
493.1
Non-Defense
Defense Environmental Restoration and
5,459.3
5,695.2
5,311.9
5,263.3
4,429.4
Waste Management
Defense Facilities Closure Projects
--
--
--
--
890.8
Environmental Restoration Privatization
--
1,006.0
--
--
200.0
National Security (Weapons)
3,911.2
5,078.7
4,302.5
3,943.2
4,146.7
Other National Security
1,605.7
1,627.8
1,981.0
1,580.5
1,666.0
Departmental Admin.
89.6
101.3
89.5
83.4
87.4
(net)
Office of Inspector General
23.8
29.5
27.5
27.5
27.5

CRS-6
Program
FY1997
FY1998
Senate Bill
House
P.L. 105-
Request*
(S.1004)
Bill (H.R.
62
2203)
Power Marketing Admin.
Alaska
4.0
1.0
3.5
1.0
13.5
Bonneville (non-add, new borrowing
277.0
253.0
253.0
253.0
authority)
Southeastern
16.4
16.2
12.2
12.2
12.2
Southwestern
25.2
26.5
26.5
25.2
25.2
Western
193.6
230.0
180.3
189.0
189.0
Colorado River Basin
--
-16.0
Falcon & Armistad O&M
1.0
1.0
1.0
1.0
1.0
FERC (revenues)
156.3
167.6
162.1
162.1
162.1
(156.3)
(167.6)
(162.1)
(162.1)
(162.1)
Nuclear Waste
365.0
380.0
350.0
350.0
350.0
Adjustments
--
--
--
--
--
Total, Title III
15,780.0
18,517.2
16,390.7
15,282.7
15,893.6
* FY1998 budget request totals include full construction funding.
Key Policy Issues
Research and Development Programs
For FY1998, DOE is requesting $6.95 billion for civilian and defense R&D activities
within the Committee's jurisdiction, compared to $6.00 billion appropriated for FY1997, a
15.8% increase. For civilian R&D programs, the request is $3.24 billion compared to $3.09
billion appropriated for FY1997, and for defense R&D (nuclear weapons) programs, the
request is $ 3.66 billion compared to $2.92 billion appropriated for FY1997. The large
increase -- most of which occurs in defense -- is mostly a result of the switch to full construc-
tion cost funding. Without that change, the FY1998 budget request would have been about
$250 million or 4.2% above the FY1997 appropriation.
Applied Energy R&D. For applied energy R&D programs, DOE is requesting an
increase of 27.7% for in solar and renewable energy. Photovoltaics, biofuels, wind, and
electric energy systems and storage would receive most of the additional funds. There may
be debate over this increase, however, as a result of different views about the role of the
federal government in supporting research with potential commercial application. The
conference bill approved a substantial increase over FY1997, but still well below the FY1998
request.
DOE is also requesting 22.7% increase in nuclear energy R&D. In addition, the
program is shifting its goals from development of the next generation of light water reactors
to support the Nation's existing power plants. DOE will establish an outside review panel to
recommend strategic changes for the program. The proposed change may generate debate

CRS-7
about DOE's relationship with the Nation's nuclear power industry. A large share of the
request, about 32%, is for termination costs of various DOE reactor facilities.
The conference bill funding level is well below the request, primarily because it did not
approve DOE's nuclear security initiative request.
Basic Research Programs. For basic research, DOE is requesting a small increase of
1.8%. The basic research programs include general science and research, basic energy
sciences, computational and technology research, biological and environmental research, and
fusion energy science. Each of these programs is asking for a small increase or decrease. No
major issues appear, although two items may receive attention. In general sciences and
research, the high-energy physics (HEP) program is requesting $394 million in advance
appropriation for FY1999 to FY2004 for United States participation in the large hadron
collider project at the Center for European Nuclear Research (CERN). This action could have
significant implications for the rest of the HEP program if future year funding is no greater
than level with this year, which seems likely. In fusion energy sciences, DOE is asking for
$55 million for the last year of the collaborative engineering design of the international
thermonuclear experimental reactor (ITER). A decision on construction will be made during
FY1998, and debate about whether the United States should participate may take place this
year.
The conference approved nearly all DOE's request in these areas. It expressed strong
support for DOE's basic science research activities. It did not, however, approve advance
appropriation for the HEP program.
Defense R&D Programs. By far, most of the increase in the DOE R&D request
resulting from the change to full construction cost funding takes place in the stockpile
stewardship program. For FY1998, DOE is asking for $876 million for remaining funds
needed to construct the National Ignition Facility (NIF). Prior to the change, the projected
request for FY1998 for the NIF was about $200 million. In addition, the request shows that
the total construction cost of the project has increased by about $200 million to $1.05 billion.
(The total project cost is now estimated at $1.2 billion up from $1.1 billion.) The request for
the core stockpile stewardship program is about 0.5% below the FY1997 appropriation.
Debate over this funding request may involve broader issues about the overall objectives of
the DOE efforts to maintain the nuclear weapon stockpile and whether these objectives can
be met.
The conference provided a substantial increase above the DOE request for the core
stockpile stewardship program. It provided funding for FY1998 construction of NIF, but did
not provide the requested full construction cost funding.
Full Construction Cost Funding
For FY1998, the Office of Management and Budget has instructed DOE to request the
full construction cost for any multi-year project which is currently under construction.
Previously, DOE only asked for budget authority for the funds incrementally each year at a
level approximating the amount it intended to obligate that year. DOE argues that this change
will allow the Congress and Administration to make decisions about projects with a clearer
view of their full costs. In addition, DOE believes the new system will make it easier to

CRS-8
ensure projects are completed on time and within budget. Outlays for these projects will still
occur over their life as originally scheduled.
For FY1998, this change adds about $1.6 billion to the total DOE budget request that
would not have been there under the previous system of incremental requests. About half of
this addition occurs in the R&D programs, primarily in stockpile stewardship, and the other
half in non-R&D programs, primarily defense environmental restoration and waste
management.
The conference declined to fund construction projects beyond the FY1998 period.
Environmental Cleanup and Waste Management
Cleaning up environmental contamination at DOE nuclear facilities and disposing of
radioactive waste continue to be the Department's most expensive activities. The FY1998
appropriations request for DOE's Environmental Management Program, which manages those
activities, totals $7.2 billion, up $1.2 billion from FY1997. The conference cut the total to
just over $6 billion, and transferred one of DOE's cleanup programs (Formerly Utilized Sites
Remedial Action Program, FUSRAP), to the Army Corps of Engineers.
Most of the additional funding requested by DOE would not have been spent in FY1998
but instead was to be held for gradual payout in future years. About $1 billion in the FY1998
request would provide advance appropriations for "privatized" waste management contracts,
and $650 million would provide full funding for proposed construction projects. If the future-
year funding in the request were subtracted, the Environmental Management Program would
rise from $5.7 million in FY1997 to $5.76 million in FY1998, according to DOE.
Privatization. DOE requested $1.006 billion in FY1998 to greatly expand the
"privatization" of waste management and cleanup projects throughout the Department.
Congress provided $330 million for DOE privatization in FY1997. Conferees provided $200
million for privatization in FY1998.
The DOE privatization initiative is intended to reduce costs by increasing competition
for cleanup work and shifting a portion of project risks from the federal government to
contractors. Profits to contractors would depend on their success in meeting project schedules
and holding down costs; potentially, profits could be substantially higher than under
traditional DOE contracting arrangements.
In a typical non-privatized DOE project, a contractor would be hired to build and
operate a facility with government funds. DOE would approve and pay all the contractor's
costs, and then award the contractor a profit based on performance. Under the privatization
initiative, a contractor would be expected to raise almost all funding for necessary facilities
and equipment for a project. The contractor would recover that investment and earn a profit
by charging previously negotiated fees to DOE for providing services under the contract, such
as solidification of radioactive waste. The contractor could earn higher profits by reducing
costs, but the contractor could lose money if project costs were higher than expected or the
required services were not delivered.

CRS-9
According DOE's FY1998 budget request, the privatization concept requires Congress
to provide sufficient budget authority in advance to cover a contractor's costs if a project is
canceled by the government. Without such advance appropriations, according to DOE,
contractors cannot raise money for privatized projects. For example, private financial backers
of a waste treatment plant would need assurance that if the plant were built and the federal
government decided not to use it, then DOE would have funding available to pay all the
project's costs to that point, plus a cancellation fee. If a project operated as planned, the
advance appropriations then would be gradually drawn down to help pay for the services
specified by the contract. In either case, outlays from the advance appropriations for
privatization would not occur until future years.
Nearly half of the FY1998 privatization request, $427 million, would be devoted to the
design and construction of two demonstration plants for treating highly radioactive waste now
stored in underground tanks at DOE's Hanford Site in Washington State. Total costs of
building and operating the demonstration plants are estimated at $4-$6 billion, with the
majority of budget outlays expected from FY2002 through FY2007. DOE estimates that
privatizing the project will reduce costs by 10-30%. The conferees placed high priority on the
Hanford waste project.
The remaining $579 million of the FY1998 privatization request would provide advance
appropriations for 11 other environmental projects throughout the DOE complex. Among the
larger projects are a radioactive solid waste treatment facility at Oak Ridge, Tennessee, spent
nuclear fuel storage facilities at the Savannah River Site in South Carolina, and a low-level
liquid waste treatment facility at Idaho Falls, Idaho. Estimated cost savings range from 10-
40%.
Controversy over the DOE privatization initiative has centered primarily on the future
budget outlays that will be generated by the large advance appropriations being requested for
the program. In addition to the $1.3 billion sought or already provided, DOE plans to request
about $500 million per year for privatization during the subsequent five fiscal years,
according to recent DOE testimony. Concerns have been raised that large future outlays for
privatized projects could have unpredictable effects on other programs in the Energy and
Water Appropriations Bill.
Other privatization issues include the accuracy of DOE's projections of cost savings, and
the degree of risk to be borne by privatized contractors. A recent report by the General
Accounting Office found some of DOE's cost-reduction projections to be overstated, although
the agency agreed that substantial savings could be expected from the new contracting
approach. Much of the success of the program may depend on the amount of real risk that
contractors agree to accept and how much risk remains with DOE. Because few privatized
contracts have yet been signed, that factor remains subject to uncertainty.
Other Environmental Management Funding. Excluding advance appropriations for
privatized contracts and construction projects, funding for DOE environmental cleanup and
waste management programs is to rise only slightly in FY1998. One exception is the
Formerly Utilized Sites Remedial Action Program (FUSRAP), which would get a boost from
$75 million to $182 million. FUSRAP cleans up non-federal sites that were radioactively
contaminated by U.S. nuclear weapons work and other activities. According to DOE, the
accelerated funding would advance the completion of the program from FY2006 to FY2002.

CRS-10
Conferees transferred the FUSRAP program to the Army Corps of Engineers, an idea that has
been proposed for all DOE cleanup activities.
A $37 million reduction is proposed for development of cleanup and waste management
technology, to $258 million. The largest reduction is in the subsurface contaminants category,
which would be cut by two-thirds and receive no new projects in FY1998. In addition to the
funding cut, $50 million of technology development spending would be shifted to a technology
deployment initiative, to help ensure that the most promising new technologies are actually
used by cleanup contractors.
The Senate cut funds to the technology a further $25 million, to $233 million. The
Committee Report declared that "changes need to be made in the management, execution and
oversight" of the program to "improve the results" of the technology investment. The House
Energy and Water Subcommittee, with similar negative comments, cut the program $75
million to $183 million. The conference agreement provides $220 million.
Nuclear Energy, Science and Technology
An increase of more than $80 million is being sought for the Office of Nuclear Energy,
Science and Technology, whose activities include development of nuclear energy systems,
international nuclear safety assistance, termination of unused facilities, and development of
spent nuclear fuel treatment processes. The FY1998 funding request for the office totals $415
million.
A major issue in the nuclear energy budget in previous years involved funding for
advanced versions of light water reactors, the type of nuclear power plant currently in
commercial operation throughout most of the world. Opponents called the funding an
example of "corporate welfare," contending that the nuclear industry, which shared the
program's costs, should develop new reactors entirely on its own. According to DOE, the
program will be successfully completed in FY1997, and only $5.5 million in "closeout costs"
are being sought for FY1998.
With the end of the advanced light water reactor program, DOE is proposing a follow-on
program that would develop technology to support continued operation of existing U.S.
nuclear power plants. However, the conference agreement provided no funding for the
initiative. The proposed "nuclear energy security" program, funded at $39 million in FY1998,
would have helped assure the diversity of the nation's energy supply and help reduce emissions
from fossil fuels, according to the DOE budget request. The program is intended to develop
technologies to mitigate the aging of nuclear plant components, develop advanced reactor
control systems, overcome obstacles to longer lasting nuclear fuel, and study other nuclear
plant operational problems. As with the light water reactor program, opponents contend that
such research should be the responsibility of the nuclear industry.
Another controversial element in the nuclear energy budget request is $25 million for
"nuclear technology research and development," which involves the "electrometallurgical
treatment" of DOE spent nuclear fuel. Conferees provided $12 million. In that treatment
process, spent fuel is melted and highly radioactive isotopes are electrically separated from
uranium and plutonium. According to the DOE FY1998 budget request, electrometallurgical

CRS-11
treatment could be used to transform unstable spent fuel into safer forms for storage and
disposal.
Opponents contend that such treatment is unnecessary and that the process could be used
for separating plutonium to make nuclear weapons. They note that the process uses much of
the same technology and equipment developed for the plutonium-fueled Integral Fast Reactor,
which was canceled by Congress in 1993 partly because of concerns about nuclear weapons
proliferation.
Line-Item Veto
On October 17 the President issued a line-item veto of two Department of Energy projects:
$4 million for a multi-purpose canister for transporting nuclear waste, and $1 million for
aluminum matrix transmission line research at Oak Ridge National Laboratory in Tennessee.
Title IV: Independent Agencies
Energy and Water Development Appropriations
Title IV: Independent Agencies
(in millions of dollars)
House
FY1998
Senate Bill
P.L. 105-
Program
FY1997
Bill (H.R.
Request
S.1004
62
2203)
Appalachian Regional
160.0
165.0
160.0
160.0
170.0
Commission
Nuclear Regulatory
471.8
476.5
476.5
462.7
472.8
Commission
(Revenues)
(457.3)
(457.5)
(457.5)
(446.7)
(454.4)
Net NRC
14.5
19.0
19.0
16.0
18.0
Tennessee Valley
106.0
106.0
86.0
0
70.0
Authority
Defense Nuclear
16.0
17.5
17.5
16.0
17.0
Facilities Safety Board
Nuclear Waste Technical
2.5
3.2
3.2
2.4
2.6
Review Board
Total
299.0
310.7
285.7
194 .4
--
Key Policy Issues
TVA is requesting the same amount of funding that was appropriated in FY1997. The
agency has also indicated that this is the last year it will request funds for the appropriated
component of TVA. Federal appropriations do not support TVA's power programs. Annual
appropriations go to nonpower programs such as flood control and navigation management.
The agency wants to make a "smooth transition" out of the nonpower programs and focus

CRS-12
solely on its power programs in a deregulated power market. TVA believes that the Army
Corps of Engineers could run its nonpower projects.
The Senate cut the TVA appropriations $20 million, to $86 million, and commented that
TVA's efforts "have not produced consensus on a way to achieve a significant shift away from
appropriations." The House recommended cutting the entire $106 million appropriation,
instructing TVA to pay for the nonpower activities out of its $5.8 billion power program. The
conference provided $70 million and "accept[ed] the Administration's proposal to terminate
appropriated funding for TVA after fiscal year 1998."
NRC is requesting a net appropriation of $476.5 million minus about $457.5 million it expects
to collect in licensing fees, inspections services and other fees leaving a net appropriation of
$19 million for FY1998.
For Additional Reading
CRS Products
CRS Report 97-54. Department of Energy Programs: History, Status, Options.
CRS Report 97-464. The National Ignition Facility and Stockpile Stewardship.
CRS Report 96-212. Civilian Nuclear Spent Fuel Temporary Storage Options.
CRS Report 97-233. The Department of Energy FY1998 Research and Development Budget
and Issues.
CRS Issue Brief 92059. Civilian Nuclear Waste Disposal.
CRS Issue Brief 97031. Renewable Energy: Key to Sustainable Energy Supply?
CRS Issue Brief 91039. The DOE Fusion Energy Science Program.

EveryCRSReport.com
The Congressional Research Service (CRS) is a federal legislative branch agency, housed inside the
Library of Congress, charged with providing the United States Congress non-partisan advice on
issues that may come before Congress.
EveryCRSReport.com republishes CRS reports that are available to al Congressional staff. The
reports are not classified, and Members of Congress routinely make individual reports available to
the public.
Prior to our republication, we redacted names, phone numbers and email addresses of analysts
who produced the reports. We also added this page to the report. We have not intentional y made
any other changes to any report published on EveryCRSReport.com.
CRS reports, as a work of the United States government, are not subject to copyright protection in
the United States. Any CRS report may be reproduced and distributed in its entirety without
permission from CRS. However, as a CRS report may include copyrighted images or material from a
third party, you may need to obtain permission of the copyright holder if you wish to copy or
otherwise use copyrighted material.
Information in a CRS report should not be relied upon for purposes other than public
understanding of information that has been provided by CRS to members of Congress in
connection with CRS' institutional role.
EveryCRSReport.com is not a government website and is not affiliated with CRS. We do not claim
copyright on any CRS report we have republished.