U.N Funding, Payment of Arrears and Linkage to Reform: Legislation in the 105th Congress

U.N Funding, Payment of Arrears and Linkage to Reform: Legislation in the 105th Congress

97-711 F
CRS Report for Congress
Received through the CRS Web
U.N. Funding, Payment of Arrears and
Linkage to Reform:
Legislation in the 105th Congress
Updated April 24, 1998
Vita Bite
Marjorie Ann Browne
Lois McHugh
Foreign Affairs and National Defense Division
Congressional Research Service ˜ The Library of Congress

ABSTRACT
The Clinton Administration and the Congress are currently debating the payment of past debt
(arrears) to the United Nations in the legislation authorizing and appropriating funds for the
Department of State. The issues include how much of the debt should be paid, the timetable
for payment, and the conditions which the U.N. must meet to receive payment. The debate
currently includes unrelated House language on abortion which derailed passage of the entire
bill in 1997. This report tracks the legislation, summarizes the bills being considered, and
refers readers to related products. It is updated regularly.

U.N. Funding, Payment of Arrears and Linkage to Reform:
Legislation in the 105 Congress
th
Summary
The conference report on H.R. 1757, the Foreign Relations Authorization bill
for FY1998-FY1999, will be debated in the Senate beginning April 24 with a vote
expected April 28, 1998. On March 26, the House adopted the conference report
(H.Rept. 105-432) on H.R. 1757; the bill authorizes a total $926 million for payment
of arrears to international organizations in exchange for U.N. and U.N. agency
reforms. The House version of the bill did not address payment of the U.S. arrears
or U.N. reforms. The conferees accepted virtually all the Senate language in
Conference. The Conference version of the bill also contains unrelated House
language restricting activities of foreign family planning organizations, which the
President has threatened to veto. This linkage derailed passage of the bill in 1997.
During the first session of the 105 Congress, Members debated the conditions
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that the United Nations would need to meet in exchange for U.S. payment of past
debt (arrears) during consideration of both authorization and appropriation legislation
to provide funds for U.S. assessed contributions to the United Nations regular budget,
U.N. peacekeeping operations, U.N. specialized agencies, and other international
organizations. The Administration and Congress disagreed over language restricting
the abortion related activities of international private family planning agencies. House
supporters of language restricting abortion related activities assert that the House
leadership is committed to maintaining a link between the abortion language and
releasing funds to pay the United Nations.
The Clinton Administration’s FY1999 request includes $231 million for U.N.
assessed peacekeeping operations and $930.773 million for assessed contributions to
international organizations of which $297 million is for the U.N. regular budget. Tthe
Administration seeks $921 million in FY1998 supplemental monies payable in
FY1999 ($475 million) and FY2000 ($446 million) for arrearages.
Last year, P.L. 105-119 (H.R. 2267), the State Department Appropriations bill,
appropriated $955.5 million for FY1998 funding for U.S. assessed contributions to
international organizations, including $54 million for arrears . The arrears payment
may be made only after enactment of of legislation authorizing such payment and
including many of the reform provisions in H.R. 1757. P.L. 105-119 also
appropriated $256 million for FY1998 contributions to U.N. peacekeeping, of which
$46 million for arrears may be made available only after specific authorization.
The 1997 Budget Resolution contains an allowance for FY1998, 1999, and 2000
for payment of arrears to the U.N. agencies affected, allowing up to full payment of
arrears as requested by the Administration. Meanwhile, during 1997, the U.N. General
Assembly in New York debated and approved many reform measures proposed by the
U.N. Secretary-General.
Note: for additional discussion see CRS Issue Brief 86116, U.N. System Funding:
Congressional Issues; and CRS Issue Brief 90103, United Nations Peacekeeping
Issues for Congress.

Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Foreign Relations Authorization Bill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
FY1998 and FY1999 Funding For Current U.S. Contributions . . . . . . . . . . 4
U.N. Peacekeeping Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Benchmarks for Payment of Arrears . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
FY1998 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
FY1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
FY2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Future of the Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Current Appropriations Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Who Is Involved in U.N. Reform? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Meeting the Benchmarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Future Concerns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Reaction at the United Nations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Foreign Policy Concerns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Peacekeeping Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Other International Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

U.N. Funding, Payment of Arrears and Linkage
to Reform: Legislation in the 105th Congress
Introduction
Some Members of Congress have argued that fiscal mismanagement, lax
personnel policies, and extravagant spending at the United Nations and other
international organizations have wasted U.S. contributions. While this view has not
been universal, Congress has voted over the last decade or more, to reduce the
amount appropriated to fund U.S. contributions to the U.N. system in order to force
the United Nations to adopt reforms aimed at curtailing waste. The Department of
State is concerned that the U.S. arrearages (money owed by the United States to
some U.N. agencies, U.N. peacekeeping, and other international organization
accounts) are continuing to grow despite the adoption by the United Nations of many
of the reform measures required by Congress and endanger the fiscal health of the
U.N. system. State Department officials argue that continued refusal to pay is
hampering U.S. efforts to make further reforms at the United Nations. During 1997,
negotiations between the Administration and Congress over the payment of the
arrears and the reforms on which payment would be conditioned were intense.
For FY1999 the Clinton Administration requested $231 million to pay for U.N.
assessed peacekeeping activities and $930.773 million to pay assessed contributions
to international organizations of which $297 million is for the U.N. regular budget.
In addition, the Administration proposes paying $1.021 billion in accumulated
arrearages to international organizations over the next three fiscal years. Most of the
funds—$921 million—are sought in a proposed advanced appropriation to be
included in a FY1998 supplemental that would only be disbursed in FY1999 and
FY2000. The Administration requested as part of a supplemental package, $921
million ($475 million for FY1999 and $446 million for FY2000 disbursement) to pay
outstanding dues owed to international organizations and for U.N. peacekeeping
operations.1
The Senate Appropriations Committee, which reported the supplemental
appropriations legislation on March 17, did not include U.N. arrearage payments.
However, during floor debate on March 25, the Senate adopted an amendment
sponsored by Senator Helms (by vote of 90-10), which expressed the sense of the
Senate that U.S. taxpayers ought to be commended for their generous U.N.
contributions and the United Nations should immediately reduce the U.S. assessed
peacekeeping assessment to 25%. The House Appropriations Committee approved
$505 million in advance appropriations ($475 million for FY1999 and $30 million for
1For more detailed information on the Supplemental legislation, see CRS report 98-123 F,
Supplemental Appropriations and Rescissions for FY1998.

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FY2000) for U.N. peacekeeping arrearages. According to the CQ Dailey Monitor or
April 24, 1998, House Speaker Gingrich has promised that a second supplemental
bill providing money for both the International Monetary Fund and U.N. arrears will
be considered by the House later in the session.

Congress appropriated $100 million ($54 million for U.N. regular budget arrears
and $46 million for U.N. peacekeeping arrears) last year (P.L. 105-119, H.R. 2267),
but those funds may not be paid until authorizing legislation is enacted which makes
payment contingent on specific U.N. reforms. In 1997, Congress and the
Administration had negotiated such authorizing language, including provisions
(popularly known as the Helms-Biden agreement) which would have allowed the
United States to pay $926 million in arrears payments over three yeas to international
organizations and U.N. peacekeeping operations ($100 million was the amount that
would be paid in the first year.). The arrearage payments were made subject to the
implementation of specified U.N. system reforms (“benchmarks”), including a
reduction in U.S. assessment rates for the United Nations, some U.N. system
organizations, and for U.N. peacekeeping operations. That authorizing legislation
was not enacted because of disagreement over unrelated House language restricting
activities of foreign family planning organizations.
At the beginning of 1998, the Administration proposed modifications in the
Helms-Biden agreement for payment of the arrears, pointing out that because the
original legislation had not passed, some of the provisions were no longer viable. In
response, the Congress, and particularly the Senate, has made clear that the Senate
language in H.R. 1757 will be adopted in exchange for payment of the $926 million
in arrears. This paper looks at the proposals contained in H.R. 1757, as reported by
House and Senate conferees.
Background
Although reforming the United Nations had been debated for years, the
Administration and the Congress had been unable to agree on the reform measures
needed until the agreement reached between Senators Helms, Biden, and the
Administration in 1997. Nor has there been a common position in Congress on
reform. Legislation introduced over the last few years has ranged widely from
withdrawing from all or some U.N. agencies to fully repaying U.S. debts to the entire
U.N. system; from limiting participation in U.N. peacekeeping operations to limits on
any participation in the U.N. system; and from reduced U.S. contributions to some or
all U.N. agencies to increased appropriations for some U.N. agencies or programs.
The fragility of the current reform/arrears agreement, as shown by the parrying
between the Administration and Congress demonstrates the difficulty of the situation.
Congress plays a key role in U.S. policy toward the United Nations because it
appropriates funds for U.S. assessed contributions. Recently, it has taken a more
active role in U.S. policy as the size of the arrears has grown (an amount which is
itself in dispute) and as it has tied payment of this debt to “meaningful reform” of the
United Nations. The falling congressional allocations for the international affairs
budget function in an attempt to reduce the U.S. budget deficit made agreement on

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repayment even more problematic because the arrears continued to grow and
repayment became more difficult every year. Some Members of Congress are using
the congressional power of the purse as leverage to streamline and reorganize the
U.N. system. Others view payment of the arrears in terms of reducing the U.S. cost
of membership in the U.N. system, without particular regard for how the reduction
occurs or its impact on the U.N. system, while other members continue to support
some or all U.N. funding.
Reform of the United Nations will occur only with the agreement of the majority
of U.N. member countries. How the other member governments view U.N. reform,
and especially U.S. proposals for change, will be influenced by how the United States
addresses the arrearage issue.
Foreign Relations Authorization Bill
Reform of the U.N. system and payment of the U.S. debts (arrears) were debated
in both the House and Senate extensively during 1997. Nonetheless, the Foreign
Relations Authorization bill, H.R. 1757, which passed the House on June 11,1997
by voice vote did not contain any of the anticipated U.N. reform amendments nor any
authorization for payment of arrears. The House-passed measure did reinstate a
modified version of the “Kassebaum-Solomon Amendment” allowing the President
to withhold 20% of the funds appropriated for U.S. assessed contributions to the
United Nations or any of its specialized agencies if the Secretary of State certifies that
such organization has failed to implement or continue to implement consensus-based
decision-making procedures on budgetary matters which ensure that sufficient
attention is paid to the views of the United States and other major financial
contributing countries.
The Senate version of H.R. 1757, which passed on June 17, 1997, contained the
text of an amendment which was negotiated among the Administration, Senate
Foreign Relations Committee Chairman Helms, and Ranking Minority Member Biden.
This bill authorized the payment of $100 million in arrears for FY1998, $475 million
for FY1999 and $244 million for FY2000. This $819 million would be paid only in
exchange for Administration certification of “reform benchmarks” to be met by the
United Nations, some of the U.N. specialized agencies, and U.N. peacekeeping
accounts. The $819 million started from the figure of $1.021 billion which the
Administration claims the United States owes and results from 3 subtractions totaling
about $202 million.
2
On March 10, 1998, House and Senate conferees filed a report (H.Rept. 105-
432) on H.R. 1757 which largely adopted the Senate-passed arrears levels linked to
a list of U.N. reform benchmarks. The conference committee subjected current
The
2
$202 million included about $68 million which would not be paid to the U.N. Industrial
Development Organization (UNIDO), a $27 million U.N. credit for tax equalization (which
the Administration had already applied in its request to Congress to reduce current FY1998
requirements), and $107 million in expected U.N. reimbursements to the United States for
peacekeeping.

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funding for international organizations to a series of withholdings and conditions,
while arrears payments in FY1998, FY1999, and FY2000 are subject to a separate
series of conditions being met. The conference report was adopted by voice vote in
the House on March 26, 1998. The Senate began consideration of the Conference
report on April 24 and is expected to vote on the bill on April 28, 1998.
FY1998 and FY1999 Funding For Current U.S. Contributions
H.R. 1757 as reported by conference committee conditions the release of $901
million for contributions to International Organizations for FY1998 and $900 million
for FY1999 on a number of factors usually requiring certification by the Secretary of
State before funds are disbursed:
! making $80 million for the United Nations available only upon certification by
the Secretary of State that during calendar year 1998 the United Nations has
not increased funding for any program without offsets elsewhere and not
exceeded its biennial $2.533 billion budget;
! withholding 20% of available funds until a certification is made about the U.N.
inspector general or Office of Internal Oversight Services (OIOS);

! blocking the disbursement of funds until the Secretary of State certifies that no
U.S. funds were contributed to pay for the holding of any U.N. single issue
global conference; or that U.S. contributions to the U.N. regular budget were
not used for any other organization, including for the Framework Convention
on Global Climate Change, the International Seabed Authority, or the 1998
Desertification convention; and
! withholding $50 million of FY1999 funds pending certification that the United
Nations has reduced 1,000 personnel slots from the 1996-1997 U. N. level of
10,012 posts as reported by House and Senate conferees.
H.R. 1757 included other conditions as well. The U.S. contribution to all the
agencies in the account was reduced to a total of $900 million each for FY1999 and
FY2000. The bill authorized appropriation of necessary sums to offset adverse
fluctuations in foreign currency exchange rates provided the Director of the Office of
Management and Budget certifies the need. The measure required that the United
States insist on refund or credit of excess contributions.
The bill stated as U.S. policy that Israel should be made a member of one of the
U.N. regional blocs, pointing out that currently Israel is the only longstanding U.N.
member which is not a member of such a bloc from which countries are elected to
membership on the Security Council. The Senate bill also sought the abolition of the
Special Committee to Investigate Israeli Practices Affecting the Human Rights of the
Palestinian People and other Arabs of the Occupied Territories, the Committee on the
Exercise of the Inalienable Rights of the Palestinian People, the Division for
Palestinian Rights, and the Division [sic] on Public Information [Special Program] on
the Question of Palestine.

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The measure also expressed the sense of Congress that all U.N. staff should
comply with child and spousal support obligations and urges the Secretary of State
to ensure that the United Nations is enforcing child and spousal support payments.
(The measure as passed by the House withheld $10 million in authorized U.N.
arrearage payments until the Secretary of State certifies that the United Nations is
actively enforcing child and spousal support payments in compliance with court orders
and the United Nations is actively reforming its pension policy to make U.N. pension
funds subject to court orders of spousal and child support.)
U.N. Peacekeeping Provisions. The bill authorized the appropriation of $210
million for Peacekeeping for FY1998, and $220 million for FY1999. It modified and
refined already enacted language, dealing primarily with reporting requirements, and
added new provisions. The bill required the United States to report annually to the
United Nations on total U.S. voluntary and assessed costs in support of U.N. peace
and security operations and requested the United Nations to compile and publish
annually the same information for all U.N. members. It established a requirement that
the United States seek reimbursement from the United Nations for any U.S. assistance
(1) to the United Nations, (2) to any U.N. authorized and funded peacekeeping
operation, or (3) to any nation to facilitate its participation in any such peacekeeping
operation. This provision applied only to assistance provided after the date of the Act
and only to assistance exceeding $3 million per fiscal year, per operation. Finally, the
bill issued a policy statement on use of U.N. commanded and funded peacekeeping
operations that is similar, but not identical, to the policy already set forth in the
Presidential Decision Directive 25 on peacekeeping and in the U.N. Security Council
President Statement, both issued in May 1994 (for discussion see CRS Issue Brief
90103, United Nations Peacekeeping: Issues for Congress). This section also stated
a policy of opposition to the establishment of U.N. peace operations approved by the
U.N. General Assembly and funded from the U.N. regular budget.
Benchmarks for Payment of Arrears
Under H.R. 1757, as reported by House and Senate conferees, a total of $926
million would be authorized for reduction of U.S. arrears to the United Nations, U.N.
peacekeeping operations, and other international organizations. Of the total amount,
$819 million would be paid over a three-year period ($100 million in FY1998, $475
million in FY1999, and $244 million in FY2000). For each year, the Administration
must certify that certain reforms have been carried out. Funds may be obligated only
if the appropriate certifications have been submitted to the appropriate congressional
committees 30 days prior to payment of such funds. Another $107 million owed by
the United Nations to the United States as reimbursable peacekeeping payments is
authorized to be used to reduce U.S. arrears to the United Nations.
FY1998. The requirements for the first year include certification that neither the
United Nations nor any U.N. affiliated agency has required the United States to
violate the Constitution or cede sovereignty, nor has it:
! imposed taxes or fees on any U.S. national, with the exception of publication
fees or World Intellectual Property Organization (WIPO);
! created a standing army;

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! charged the United States interest on arrears (only the International
Telecommunications Union (IPU) and the Universal Postal Union (UPU)
currently charge interest on arrears);
! exercised authority or control over any U.S. national park, wildlife preserve,
monument or property; or
! engaged in external borrowing.
None of these requirements is likely to cause problems to the United Nations
under current interpretation. With the exceptions noted above, no U.N. agency
currently has the authority to take any of these actions. Senator Helms described
interference with U.S. sovereignty as a potential problem during floor debate and
Senator Biden described the danger as “basically zero”.
FY1999. The benchmarks include a certification that the FY1998 benchmarks
continue to be satisfied. The United Nations must establish a “contested arrearages
account” for all U.S. arrearages not included for payment in this authorization,
incurred before the date of enactment of this legislation, and agree that the amounts
in this account will not be used to apply the provisions of Article 19 of the U.N.
Charter to the United States (Article 19 states that countries whose arrears equal or
exceed the preceding two full years contributions to the United Nations shall lose
their vote in the General Assembly). Some have questioned whether this provision
requires the United Nations to take control of contested arrears owed to all U.N.
agencies, and argue that the United Nations does not have the authority to address
arrears owed to other agencies. The proposal would have to be clarified, debated,
and adopted by the General Assembly.
In addition, for FY1999, there must be a reduction in the U.S. assessment rate
from 25 percent to 22 percent for the regular budgets of the United Nations, the
World Health Organization (WHO), the International Labor Organization (ILO), and
the Food and Agriculture Organization (FAO) and from 31 percent to 25 percent in
the peacekeeping assessment. It also requires that the two U.N. peacekeeping
operations funded by the U.N. regular budget, the U.N. Military Observer Group in
India and Pakistan (UNMOGIP), and the U.N. Truce Supervision Organization
(UNTSO), be subject to annual review by the U.N. Security Council.
FY2000. The benchmarks include certification that all previous benchmarks
continue to be satisfied. In addition, the U.S. assessment for the United Nations and
all U.N. specialized agencies must be no more than 20 percent. Other benchmarks
include:
! The WHO, ILO, and FAO must establish and have regular reports by
independent inspectors general, similar to the United Nations Inspector
General (OIOS);
! The United Nations, ILO, WHO, and FAO must adopt program evaluation
procedures which will result in regular evaluation of the continued relevance

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and effectiveness of all programs, and the termination of those which are no
longer needed (sunset provision);
! These four agencies must establish clearer budget procedures, and maintain
budgets which do not exceed levels agreed on at the beginning of each
budgetary biennium except by consensus agreement; and
! The ILO, WHO, and FAO must have approved a 2000-2001 budget that
reflects a decline in budget from the levels agreed to for 1998-99.
In addition, the United Nations must have given U.S. General Accounting Office
(GAO) access to financial data for nationally mandated reviews and the United States
must have a permanent seat on the U.N. Advisory Committee on Administrative and
Budgetary Questions (ACABQ). Another benchmark requires modification in the
U.N. procurement system.
The bill also requires certification that the U.N. Secretary-General has
established merit hiring, an employee code of conduct, a personnel evaluation system,
enforces worldwide availability of staff, and conducts periodic assessments of the
U.N. payroll to determine total staffing. The United States must have completed a
thorough review of the U.N. personnel allowance system and made recommendations
to reduce entitlements.
The conference version of H.R. 1757 grants the Secretary of State a very limited
authority to waive one of the conditions in each of FY1999 and FY2000. The waiver
may be exercised only if substantial progress has already been made in meeting the
conditions to be wived. No waiver is allowed for the requirements to reduce U.S.
assessment rates or to establish an inspector general in the specialized agencies.
Future of the Legislation
In late February, 1998, the Administration provided the Congress with legislation
modifying H.R. 1757 which took into consideration the changes in assessment rates
made during the 1997 General Assembly session, the additional money needed to pay
U.S. contributions to the United Nations due to lack of legislation during 1997, and
made other technical changes in the language of the legislation. In response, Senator
Helms released to the press a letter he sent to Senate Majority Leader Trent Lott
opposing any changes to the agreement reached in 1997 and blaming the President’s
lack of agreement on the abortion related provisions for the current disagreement.
(The President has threatened to veto the legislation if it includes the abortion
language.) The conference legislation, which was filed in the House on March 10,
is very close to the Senate version of H.R. 1757.
In the House, the majority leader postponed consideration of the conference
report because of inability to agree on a rule for consideration, according to the
March 13 issue of CQ Congressional Record Scanner. According to CQ, the
opposition to the conference report includes conservative Republicans, who refused
to vote to authorize payment of back dues to the U.N. system, Republicans who
disagree with the inclusion of language concerning abortion programs, and most
Democrats. Congressman Hamilton, ranking Democrat on the International Relations

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Committee, is reported to have complained to the Rules Committee that the minority
was not consulted at all on the legislation, and that the conference had not met since
last July. He outlined several provisions which he felt would undermine the
President’s authority and undermine U.S. foreign policy, both as regards the U.N.
related language, and as regards other portions of the bill which also reorganized the
Department of State and other foreign policy agencies.
The Senate version of the authorization bill (H.R. 1757) passed in 1997 by a
vote of 90 to 5. Because it also authorized funds for and reorganized several of the
U.S. foreign affairs agencies, this vote may not reflect Senate sentiment toward the
U.N. reform provisions. U.N. provisions of the bill were part of a larger overall
compromise between the Administration and Senator Helms on a variety of foreign
policy issues, as well as on the more domestic issues of the budget agreement.
Senators Helms and Biden claimed to have the support of the Administration on the
U.N. reform measures, and noted that the reforms proposed were substantially the
same as those proposed by the U.N. Secretary-General. H.R. 1757 had strong
bipartisan support both in the Foreign Relations Committee and on the floor. Both
Senators Helms and Biden indicated during the debate that the bill was a compromise
in which both sides had given up significant provisions. Senator Biden and several
other members indicated that they would have preferred payment without
benchmarks, but that this bill was the best the Senate could do. Senator Robb’s floor
statement on H.R. 1757 said that the majority of the Senate will only agree to pay our
debts conditioned on comprehensive U.N. reforms as the prerequisite for payment.
And Senator Lugar’s amendment to H.R. 1757, which would have authorized the
same $819 million for arrears without any benchmarks, was defeated by a vote of 73
to 25.
Although the House did not vote on the Senate reform/arrears payment
language, an indication of member sentiment was the vote on the Obey amendment
to H.R. 2267, the Department of State appropriation bill. This amendment would
have removed the requirement for an authorization, with all its attendant reform
measures, for the $100 million of arrears money contained in the bill for FY1998.
The amendment was defeated by a vote of 216 to 171.
U.N. arrears/reform is currently linked to the Administration/congressional
debate over abortion policy. According to House members who oppose abortion, the
House leadership has agreed that the U.N. arrears funds should be linked to a return
to the “Mexico City” language banning abortion related activities by any agency
receiving U.S. government funds.
Current Appropriations Legislation
The Administration’s request for FY1999 appropriations included $231 million
to pay for U.N. assessed peacekeeping operations and $930.773 million to pay
assessed contributions to international organizations, of which $297 million is for the
U.N. regular budget. The Administration also proposed paying $1.021 billion in
accumulated arrearages to international organizations over the next three fiscal years.
Most of the arrearage funds—$921 million—were sought as a proposed advance

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appropriation to be included in an FY1998 supplemental but would only be disbursed
in FY1999 ($475 million) and FY2000 ($446 million).
The Senate Appropriations Committee did not include funds for international
organization arrears in reporting FY1998 supplemental appropriations legislation.
However, on March 25, 1998, during floor debate on S. 1768, the Senate agreed to
an amendment offered by Senator Helms, which expressed the sense of the Senate
that American taxpayers ought to be commended for their generous contributions to
U.N. activities and called for the United Nations immediately to reduce the U.S.
peacekeeping assessment to 25%. The amendment also called on the U.S.
Ambassador to the United Nations to introduce a resolution in the U.N. Security
Council requiring the Council to report to U.N. members the amounts that the U.S.
government has spent in support of U.N. Security Council resolutions since January
1, 1990, and for the Secretary of State to issue a demarche to all U.N. members
informing them of the funds that the United States had expended in support of U.N.
Security Council resolutions. Within 45 days of enactment, the President is to report
to Congress on implementation of these actions.
The House Appropriations Committee approved $505 million in advance
appropriations ($475 for FY1999 and $30 million for FY2000) for U.N. peacekeeping
arrears. Expenditure of funds is subject to enactment of authorizing legislation
including required reform conditions and prohibits payment of arrearages until the
U.S. assessment for the U.N. regular budget is reduced to 22% and for peacekeeping
to 25%. The Committee explained that the recommended $505 million, together with
the $100 million provided in the regular FY1998 appropriation (P.L. 105-119) and
another $107 million authorized in the State Department authorization (H.R. 1757)
to be credited to U.S. arrearages to the United Nations, totals $712 million, which is
the amount that the Administration has sought for payment of U.N. regular budget
and peacekeeping arrears. The remaining $309 million requested for payment of
arrears to other international organizations, in the Committee’s view, need not be
dealt with in an advance appropriation.
Although the authorization bill did not pass during 1997, P.L. 105-119 (H.R.
2267), which became law on November 26, 1997, provided FY1998 appropriations
for calendar 1997 U.S. contributions to certain international organizations and U.N.
peacekeeping operations below the Administration-requested level. However,
Congress assumed that favorable exchange rate savings due to the continuing strength
of the U.S. dollar would make the lower appropriations levels sufficient to pay
assessments due in FY1998 and avoid further arrearages. The Administration had
requested $969.5 million for current contributions to international organizations and
$240 million for current assessed peacekeeping activities. Congress appropriated
$901.5 million for current contributions. In addition, Congress appropriated $54
million for payment of some U.S. arrears but only after passage of an authorization
which includes some of the reform measures proposed by the Senate in H.R. 1757.
The bill also appropriated $210 million for peacekeeping, and an additional $46
million is available for payment of arrears under the same conditions. H.R. 2267
passed the House by a vote of 282-110 and the Senate by unanimous consent on

CRS-10
November 13, 1997. The bill, as passed, also reiterated several conditions whic
3
h
have been in the legislation for several years and affect the timing and amount of the
U.S. payment. Several of these conditions had also been part of the reform/arrears
language of H.R. 1757. These include:
! withholding 20% of available funds until a certification is made about the U.N.
inspector general or Office of Internal Oversight Services (OIOS);
! making $100 million (up from $80 million in previous years) available only on
a semi-annual basis upon certification by the Secretary of State that in the
preceding 6 months the United Nations has not increased funding for any
program without offsets elsewhere and not exceeded its biennial 1998-1999
budget of $2.533 billion; and
! transferring $12 million from this account for U.S. contributions to the
Comprehensive Nuclear Test Ban Treaty Preparatory Commission.
Congress also continued two restrictions on funding peacekeeping operations
until reports to Congress are made.
Who Is Involved in U.N. Reform?
In Congress, the actors vary depending on the particular U.N. reform issue. The
Senate Foreign Relations and the House International Relations Committees, and the
Senate and House Appropriations Committees play a major role in the debate,
particularly in the subcommittees which address Department of State funding.
Congress funds U.N. system contributions through two separate authorization and
appropriation channels. The United Nations, the autonomous U.N. agencies, and
many other international agencies to which we contribute assessed contributions are
authorized and appropriated in the legislation governing the Department of State. In
these agencies, member governments agree on a regular budget and an assessment
level for each government, and the United States and all other members are obligated
to pay that amount. Most other U.N. agencies or programs are funded through the
Foreign Aid Authorization and Appropriation legislation4. While most of the reform
requirements have been set during consideration of Department of State legislation,
3For details on this legislation, see CRS Issue Brief 86116, U.N. System Funding:
Congressional Issues.
The
4
humanitarian assistance, development assistance, and some technical assistance agencies
and programs of the U.N. system are authorized and appropriated as part of the foreign
assistance legislation. Contributions to these agencies are entirely voluntary and the United
States can pay as much or as little as it wishes . . . or nothing at all. These agencies include
UNICEF and the World Food Program. Some U.N. system agencies, such as the International
Atomic Energy Agency (IAEA) and the International Civil Aviation Organization (ICAO),
while funded primarily by an assessed regular budgets, also have special programs that are
funded from voluntary contributions. In these cases, Congress considers and funds U.S.
contributions to these agencies through both acts.

CRS-11
Congress has also used the Foreign Aid appropriations legislation during the last
decade to press for reforms.
The Congressional Budget committees, in setting overall spending levels for
broad U.S. government activities, including international affairs, also play a significant
role, though their interest is more focused on domestic economic conditions than on
the United Nations. The Budget Resolution, as passed by both houses in 1997,
provides for payment of arrears to the U.N. agencies and peacekeeping accounts at
the level requested by the Administration. But the resolution clearly left the decisions
about the amount and conditions of repayment to the authorizing and appropriating
committees. It also required the return of any money not dedicated to payment of
arrears to the Treasury, rather than allowing it to be used for other purposes.
The House and Senate leadership and their staffs have been deeply involved in
U.N. reform discussions as well, with particular attention to the impact of U.N.
funding on the U.S. budget. Discussion on payment of arrears to the United Nations
system and the reform “benchmarks” to be met by the United Nations in exchange for
payment are taking place in closed sessions and negotiations with top level
Administration officials.
In the Senate, the debate has been directed by Foreign Relations Chairman Jesse
Helms, with the backing of the Republican majority, majority leader Trent Lott, and
Judd Gregg (chairman of the Appropriations subcommittee with jurisdiction over
U.N. appropriations) in many of his efforts to date. Senator Helms is a long time
critic of the United Nations who has often expressed his dissatisfaction with the pace
of reform. Senator Joseph Biden, the ranking minority member, played a significant
negotiating role on behalf of the Administration and supported the bill on the floor.
On the other hand, Senators Lugar and Sarbanes, next in seniority on the Foreign
Relations Committee on both the majority and minority sides did not support the
legislation as reported.
In the House, direction of U.N. reform efforts has been more diffuse.
International Relations Committee Chairman Benjamin Gilman has a long-term
interest in the United Nations and has played a significant role in the current debate.
In the final defeat of the “arrears/reform” legislative package, the House leadership
played a significant role. The reform/arrears language was withdrawn from the bill
because the Administration and the House could not agree on House sponsored
language restricting abortion related activities, a subject more closely related to the
domestic abortion debate than to international activities.
For the Administration, the actors are equally diverse. While acknowledging
obligations of membership in multilateral organizations pursuant to treaties ratified
with the advice and consent of the Senate (such as the U.N. Charter) or by specific
acts of Congress (such as acceptance of the International Labor Organization
Constitution) to include assessed financial contributions, the Clinton Administration
has not forcefully argued before Congress that U.S. payment is an international legal
obligation. Indeed, though the Department of State supports full funding of U.S.
contributions to the U.N. system and payment of the arrearages, increasing demands
on a static or falling State Department budget have put pressure on the Department
leadership to go along with reduced contributions for U.N. accounts in order to fund

CRS-12
other department functions. The Office of Management and Budget has also involved
itself as a player in the reform debate, though often with more concern for total
federal expenditures than U.N. reform issues.
The United States supported U.N. Secretary-General Kofi Annan for office on
the understanding that he would be more forceful in his reform efforts than his
predecessor. One of his first acts was to travel to Washington to discuss reform with
Congress, an unusual action for a U.N. Secretary-General, and he has returned several
times to discuss the arrears/reform issue. He also began his tenure with an ambitious
agenda for reform which drew on the reform proposals of the United States and other
members. The U.N. membership adopted many of his provisions during the 1997
General Assembly session, but they still must be implemented . On the issue mos
5
t
important to Congress, the reduction of the U.S. assessment rate, the General
Assembly did not adopt the U.S. proposal, but did leave open the possibility of
reconsidering it if progress can be made in other areas resulting in payment of the
arrears. In the long run, acceptance of the U.S. reform proposals depends on the
ability of the U.S. government to convince the other governments of the world that
these efforts are worth pursuing, and that reforms to date have been inadequate.
Member Governments agree that waste and fraud should be eliminated, and many
would like to see smaller budgets and fewer staff. But many governments also
publicly criticize the U.S. arrearage. U.S. loss of a seat on a major U.N. budget
committee (the Advisory Committee on Administrative and Budgetary Questions) in
November 1996 was an indicator of the concern, if not anger, of other governments.
Many also express concern that the U.S. goal is not reform of the United Nations, but
the elimination of a number of its agencies and programs.
Meeting the Benchmarks
The focus of the Senate version of H.R. 1757, according to the committee
report, is on reduced spending. The major provision governing payment of arrears
is the reduction of the U.S. assessment from 25 percent to 20 percent in all agencies
and for peacekeeping from 31 percent to 25 percent. Senator Helms stated during the
floor debate that in the future, Americans will pay a smaller share of a smaller budget.
The report language makes clear that Congress is willing to contribute no more than
$900 million overall to international agencies after FY1998.
Many of the benchmarks in the legislation provide policy guidance for the
Administration rather than mandate changes in U.N. procedures. Others required for
the second and third years of the reform effort are already underway. The United
Nations, ILO, WHO, and FAO, all either have or are in the process of establishing
inspector general units and clearer budget documents. They are clearly working
toward reduced budgets and greater program evaluation. In those cases where the
benchmarks proposed are already part of U.N. Secretary-General Annan’s planned
reform measures, it is possible that the benchmarks can be met according to the
Senate timetable, and Senators Biden and Helms indicate the United Nations can
easily meet them. The Administration, including former Congressman Bill Richardson,
Fo
5
r a summary of the reform adopted by the 1997 General Assembly, see CRS Report 98-
275 F. U.N. Reform in the 1997 General Assembly. March 23, 1998.

CRS-13
U.S. ambassador to the United Nations, and Secretary of State Albright, have also
assured Congress that the United Nations can meet the requirements. In other cases,
and particularly those where other governments are likely to disagree with U.S.
reform efforts, meeting the benchmarks within the Congressional time frame is not so
promising.
Senator Lugar argued in his dissenting views in the committee report that the 38
benchmarks included as preconditions to paying U.S. arrears make it unlikely that
United Nations members can meet them in the next three years, so the problem of
U.S. arrears will linger. He was pessimistic that the United Nations will reform in the
manner we wish or that the United States will ever pay the arrears. In his statement
before the Senate Foreign Relations Committee during hearings on U.N. reform on
November 6, U.S. Ambassador to the United Nations for Management and Reform
Richard Sklar stated that there is great fear among members that the current reform
efforts are part of a U.S. attempt to downsize the United Nations and diminish the
power and influence of the General Assembly.
The most serious obstacle to meeting the benchmarks is the reduction of the U.S.
assessment from 25 percent to 20 percent. Under the criteria used to determine
national assessments, the 25 percent cap on contributions means that the United
States pays a smaller contribution than it should. Other countries with smaller
economies are paying an increasing share of the cost of the United Nations. Under the
schedule adopted in December for contributions covering 1998-2000, Japan’s
assessment will rise to over 20 percent and Germany’s to nearly 10 percent, for
example . U.N. memb
6
ers, including close allies among the industrialized countries,
universally deeply resent the U.S. position and attitude, according to Ambassador
Sklar at the November 6 hearing. They have long been critical of the U.S. failure to
pay
r debts to the United Nations and the majority do not support furthe
“concessions”
.
reports indicated that all U.N. members, both industrialized and developing
opposed
l
ssembly began meeting in New York in
fall
icated that support for the reduced U.S. assessment had grown somewhat
Nonetheless,
arrears/reform package was dropped from U.S. legislation in
abortion language dispute, U.S. Ambassador to the United Nations Richardso
w
nvince other members
cut the U.S. assessment from 25 to 22 percent.
1
2000 assessment level in late December continued the U.S. contribution at 25
ercent.) After def
unnamed
n
ctive,
y
7
6Data on the contributions, assessment rates, and arrears of the 15 largest U.N. donors is
contained in CRS Report 95-571 F, United Nations Regular Budget Contributions: Members
Compared, 1989-1996. September 19, 1997. For information on the 1998 assessment
schedule, see CRS Issue Brief 86116, U.N. System Funding: Congressional Issues.
Washington Post
7
. November 15, 1997. A 18

CRS-14
Reduction of the U.S. assessment in the U.N. specialized agencies presents an
additional problem. In the three largest U.N. agencies, where the United States pays
25 percent of the budget, the ILO, WHO, and FAO have already established their
1998-1999 budgets and assessments. While all three have agreed to consider
revisiting their budget decisions during 1998 in order to retroactively reduce the U.S.
assessment, their assessment levels follow that of the General Assembly, which has
not yet reduced the U.S. assessment. The annual meetings of all three organizations
are in early summer.
Finally, there is concern that even if U.N. member countries accept all these
benchmarks, the U.S. will still refuse to pay. Money must be appropriated annually
by Congress. Previous Congresses and Administrations have already created three-
year, five-year, and seven-year repayment plans which were not fully implemented.
Although the first $100 million was appropriated in 1997 (but cannot be contributed
without authorizing legislation) and the second year has been included in the House
supplemental appropriation, at least, the three-year period involves a commitment on
behalf of a future Congress. In addition, this legislation continues old and adds new
withholding conditions for FY1998 funding. Who is to say that additional conditions
will not continue to be added with each Congress? Senator Lugar noted that even
while the bill attempts to address the arrears, it also creates new debts by providing
less than the Administration request. Such partial and conditional withholding in U.S.
funding led to the cumulative build up of U.S. arrears that this legislation purports to
address, but at the same time creates more U.S. conditions, withholding, and delay
in payments.
Future Concerns
Reaction at the United Nations
Press reports indicate that U.N. members and the Secretary-General expressed
dismay over the Congressional inaction on the arrears/reform package as the General
Assembly Session concluded its session in late 1997. It came, in fact, just one day
after the U.N. General Assembly adopted by consensus much of the U.N. Secretary-
General’s reform package substantially as it had been proposed in March and July of
that year. Echoing the concern expressed by the Administration, U.N. delegates
representing close allies noted that the failure to pass the legislation would not help
the U.S. position in the United Nations on reform issues or reduced assessments.
Countries continued to repeat these sentiments when the General Assembly
reconvened on March 10, 1998.
Throughout the Fall 1997 session of the General Assembly, Administration
officials and members of Congress had worked to gain support for the arrears/reform
plan proposed by Congress. Secretary of State Albright urged U.N. members to
accept the U.S. proposal, saying: “If the United Nations waits for a better proposal
with more from the U.S. Congress, it is likely to get a proposal with more

CRS-15
requirements and less money.”8 Congressional supporters emphasized to U.N.
members that the bill would ensure the payment of $819 million and end the feud with
the United Nations over payment of arrears. Senator Biden noted that $575 million
would be paid off in the first two years. (The $819 million is the amount agreed upon
by Senator Helms and the Administration as the amount acceptable to both sides. This
amount was later raised to $926 million with the Senate/ State agreement to dedicate
o arrears $107 million owed to the United States by the United Nations, but not yet
aid, for certain peacekeeping expenses, rather than returning it to general revenue.)
many of the reforms insisted on by Congress were included in th
Secretary-General’s
l
stalemat as a betrayal of promises to pay up since, on paper at least, the U.N.
Assembly is in the process of reforming the United Nations along the lines
that Congress has proposed. Even the budget, adopted by the General Assembly for
the two year 1998-1999 period, of $2.532 Billion was a little below the requirement
set by Congress for the period in H.R. 1757. The chairman of the European Union
was quoted as saying that the United States was endangering reforms in the
organization while contributing to its financial crisis. He repeated this statement when
the General Assembly reconvened in March 1998 to address the funding situation.
Whether the members will agree to adopt the U.S. proposals is a matter of negotiation
and whether the measures adopted by the U.N. General Assembly will satisfy the
Congress is a completely separate question.

U.N. Secretary-General Annan met with the President and Members of Congress
in early March 1998, in an attempt to bring about progress in payment of U.S. arrears.
According to Joseph Connor, Undersecretary General for management, the United
States is in danger of losing its vote in the General Assembly. In explaining this, U.S.
Ambassador Richard Sklar noted that if Congress doesn’t fund the arrears by October
1 of this year, the country will be in arrears enough to trigger Article 19 of the U.N.
Charter. On October 1, countries that are deficient in their payments equal to two
years of contributions are given notice that they will lose their voting rights on
January 1.
The resolution on the scale of assessments for the 1998-2000 U.N. budget,
which was adopted in December 1997, demonstrates what the United States did not
achieve in apportioning the costs of the United Nations. The resolution adopted
continued the United States assessment at 25 percent. A second U.S. proposal, which
would base the assessment on a significantly shorter economic time period (3 years)
was not adopted, although the time period was reduced from 7.5 to 6 years.
However, a clause of the resolution would allow the assessment schedule to be
revisited during the 1998 session for possible revision of the 1999 and 2000
assessments if progress is made in paying arrears.
Foreign Policy Concerns
A concern raised throughout the debate is the impact of nonpayment on U.S.
leadership in the United Nations. Senator Lugar and other members also have
Washington Post
8
. September 28, 1997. A 13.

CRS-16
expressed concern for the impact of Congressional U.N. funding/reform actions on
other U.S. foreign policy relationships. He noted that whenever the United States
backs away from honoring its commitments, other nations take notice. He argued
that this action jeopardizes our leverage in a host of foreign policy and national
security issues, is not good foreign policy, and that the future ramifications are likely
to be expensive. Senator Sarbanes commented that the Foreign Relations Committee
attempt to micro-manage the United Nations may alter the very nature of our
relationship with that agency to our detriment.
Senator Biden expressed the hope that this legislation would restore bipartisan
support for the U.N. system. He called the bill balanced, important to U.S. foreign
policy and workable. Both Senator Helms and Biden expressed concern that without
this compromise language, foreign policy decisions on the United Nations are left to
the Appropriations Committee.
Peacekeeping Issues
The Conference report provided a total of $819 million for payment of U.S.
arrears to all affected international organizations in the Contribution to International
Organizations account also includes the U.N. assessed peacekeeping accounts funded
through the Contributions for International Peacekeeping Activities account. As of
December 31, 1996, the United Nations listed the United States as owing $926.1
million to U.N. peacekeeping accounts alone. The Administration arrears request for
U.S.-recognized peacekeeping arrears totalled only $658 million. Where does the
United Nations get the remaining $268.1 million, nearly 30% of the year-end U.S.
outstanding contributions on the U.N. books?
Other International Agencies
A final concern about the language of the legislation which was not raised during
the debate is the impact of the current impasse on other international agencies. The
bill includes arrears payments to all the organizations in the account, including, for
example, non-U.N. organizations such as the Organization of American States (OAS),
the Organization for Economic Cooperation and Development (OECD), the World
Trade Organization (WTO), and the International Agency for Research on Cancer.
Payment of the U.S. debt to these other organizations is put off until the third year of
the agreement. Payment to these agencies is also dependent on required reforms being
implemented by the United Nations and the three designated U.N. specialized
agencies (FAO, ILO, and WHO) within a three-year period.