EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON, D.C. 20503

STATEMENT OF ADMINISTRATION POLICY
 (THIS STATEMENT HAS BEEN COORDINATED BY OMB WITH THE CONCERNED AGENCIES.)

June 2, 1997
(House Rules)


H.R. 1486 - Foreign Policy Reform Act
(Gilman (R) New York)

The Administration supports the overall fiscal year 1998 appropriation authorization levels in H.R. 1486, as reported by the International Relations Committee. In the aggregate, these levels conform to those provided in the House-passed Budget Resolution. The Administration also commends the Committee for providing important new authorities, as requested by the Administration, to carry out U.S. foreign relations. These include provisions which constructively extend the President's special authorities in the Foreign Assistance Act.

Several very objectionable amendments, which are described below or in the attachment, have been submitted to the Rules Committee for its consideration in granting a rule for H.R. 1486. Of particular concern are amendments that would: (1) authorize foreign affairs programs at levels below those provided for in the 1998 Budget Resolution; (2) micromanage the planned reorganization of the foreign affairs agencies; (3) establish prejudicial conditions and restrictions on the payment of arrears to international organizations; and (4) impose unwarranted restrictions on international family planning programs. In addition, there are other amendments, as well as provisions of the bill, which would restrict the President's ability to conduct foreign relations. If any of these amendments are included, alone or in combination, in the bill presented to the President, his senior advisers would recommend that H.R. 1486 be vetoed .

Foreign Affairs Appropriation Authorization Levels

The appropriation authorization levels in H.R. 1486, in the aggregate, are consistent with the Budget Agreement for fiscal year 1998. The Administration, therefore, would strongly oppose any amendments to reduce foreign affairs authorizations below those levels or, in the case of the Arms Control and Disarmament Agency (ACDA), to delete the Agency's entire authorization for fiscal years 1998-1999. The Administration also urges the House to provide appropriation authorization levels in FY 1999 consistent with the Budget Agreement.

Foreign Affairs Reorganization

H.R. 1486 should permit bipartisan movement towards the common goal of reorganizing and reinventing the State Department, ACDA, U.S. Information Agency (USIA), and the Agency for International Development (AID). The Administration supports the Hamilton amendment on reorganization, which will achieve this goal.

The Administration strongly opposes a Gilman-sponsored amendment that would mandate many of the details on how to implement such a complex reorganization, thereby prejudging how the foreign affairs agencies are to be restructured. Such a directive would be incompatible with the flexibility needed by the President to reorganize the foreign affairs agencies to meet the challenges of the 21st century.

International Organizations (IO) Arrears

The Administration is pledged to reforming the United Nations (UN) and other international organizations while enhancing U.S. credibility by paying arrearages -- a top priority of the Administration. The Administration has been working with the Congress to identify specific reform benchmarks, but there is a limit to what can reasonably be negotiated with other sovereign member states. While the Administration supports the Hamilton UN reform amendment, it strongly opposes the Gilman-sponsored amendment because it would push well beyond such limits and would set back chances for progress on this important matter. Other amendments which may be considered could actually undermine the ability of the United States to exercise leadership and to work effectively with the UN.

International Family Planning

The Administration strongly opposes the Smith amendment that attempts to impose statutory restrictions on funding for international family planning programs along the lines of the so-called Mexico City policy. Such limitations harm safe, voluntary family planning programs which are needed to reduce unintended pregnancies, child and maternal deaths, and the incidence of abortion.

Foreign Relations Restrictions

The Administration welcomes expressions in the bill of support for an "open door" approach to NATO enlargement, so that Alliance membership will remain open to other Central and Eastern European democracies after the first state or states are invited to join. Conversely, the Administration would oppose amendments requiring the President to differentiate among prospective members and rate publicly their relative preparedness to join the Alliance. Similarly, the Administration would oppose amendments seeking to stipulate the content of the Founding Act which the NATO members have already signed with Russia.

H.R. 1486 also contains additional highly objectionable provisions that would restrict the President's ability to conduct foreign policy. For example, there are restrictions related to Jerusalem and limits placed on assistance to Russia. These and other concerns are described further in the attachment. The Administration will seek to modify or delete these provisions as the legislative process continues. Finally, other objectionable amendments have been proposed that would severely restrict the President's authorities and make it harder for any Administration to react to unanticipated contingencies.

The Administration is continuing to review H.R. 1486 and may seek further changes to the bill as the legislative process continues.

Pay-As-You-Go Scoring

H.R. 1486 would increase direct spending; therefore, it is subject to the pay-as-you-go requirement of the Omnibus Budget Reconciliation Act (OBRA) of 1990. OMB's preliminary scoring estimates of this bill are presented in the table below. Final scoring of this legislation may differ from these estimates.

 PAY-AS-YOU-GO ESTIMATES
($ in millions)
 199819992000200120021998-2002
Direct
Spending		0.32.86.27.98.425.7

ATTACHMENT

ADDITIONAL ADMINISTRATION CONCERNS WITH H.R. 1486

Unnecessary Foreign Policy Restrictions. H.R. 1486 imposes unnecessary restrictions on the ability of the President to conduct American foreign policy. Some of these restrictions would also impermissibly infringe on the President's constitutional authorities. There are also potential amendments in these and related areas, which we strongly oppose. Objectionable provisions include:
  • Section 1710 on U.S. Policy in Jerusalem, which includes the objectionable earmarking of funds to construct a U.S. Embassy in Jerusalem. These provisions would infringe on the President's constitutional authorities and would be counterproductive to U.S. efforts to promote peaceful resolution of the Arab-Israeli conflict. The large earmark would force funds to be diverted from maintenance, rehabilitation, and current leases, and could even cause the State Department to close other posts. Also objectionable is the bill's policy statement related to Egypt and Camp David commitments. These provisions could undercut U.S. credibility as an active intermediary in the peace process.

  • Section 513, which unacceptably restricts assistance to Russia and would damage U.S. national interests in supporting a successful democratic and economic transformation of Russia. These restrictions undercut those in Russia who support democratic and market economic principles, and are helping to integrate Russia into global economic and security institutions.

  • Section 466, which requires international negotiations to establish a multilateral code of conduct for arms sales. This requirement would raise constitutional concerns regarding the President's foreign affairs authority.

  • Section 504, which subjects contributions to the International Fund for Ireland to certain specified employment principles.

  • Section 426, which sets objectionable limits on foreign military financing loans, particularly in fiscal year 1999.

  • Section 576, which restricts humanitarian assistance to North Korea. This could unduly constrain the Administration's flexibility in responding to urgent developments in that region.

  • Section 1702 regarding U.S. Policy on torture. The Administration generally supports the Lantos Amendment to this section, which addresses the Administration's most serious concerns.
Other Funding Issues. H.R. 1468 contains earmarks and other limitations which undermine Administration priorities for the Economic Support Fund (ESF), the New Independent States (NIS), and Support for Eastern European Democracy (SEED). The combination of earmarks and recommended authorization levels for specific regions and programs creates objectionable statutory limitations on the Administration's ability to meet new development challenges as they arise.

In several areas (such as Refugee Assistance, Development Assistance, and Development Fund for Africa), H.R. 1486 provides authorization of appropriations in excess of requested levels, which results in decreased authorization levels elsewhere.

Finally, H.R. 1486 includes appropriation authorizations for FY 1999 which are below those projected in the President's FY 1998 Budget and in the Budget Agreement.

Micromanage Executive Authority. Statutory requirements to create certain positions and specify criteria for personnel positions and bureaus (sections 1301, 1303, 1304, 1305, and 1306) undermine the Administration's authority to organize the Department of State and manage U.S. foreign affairs. These and other restrictions on foreign service staffing levels, (particularly section 1326) along with proposed amendments which would require counterproductive reductions in AID staffing levels, are particularly inappropriate. This is especially true at a time when the Administration is working to implement the President's plan to restructure foreign affairs agencies.

The Administration also opposes language in section 1406 that would mandate the consolidation of international exchange and training programs. Mandating consolidation and establishing an artificial level of "savings" to be derived from consolidation prejudges deliberations on this issue and should not be included in the bill.

Section 1201(c) would earmark funds that would otherwise be available to satisfy claims of U.S. citizens against a foreign state, and use them for the Department's reward program. In addition to depriving U.S. citizens of access to these funds, this provision would entitle a foreign state to make a claim against the United States. This is inappropriate and unnecessary, since funds appropriated to the Department's emergency account have to date been sufficient to cover the offered rewards.

In addition, section 1327, which extends Law Enforcement Availability Pay (LEAP) to the Diplomatic Security Service, should be modified to cover all Diplomatic Security special agents.

Reporting Requirements. In addition, H.R. 1486 includes several reporting requirements to Congress that will significantly increase workload requirements. Specifically, the Administration opposes the extensive, overly detailed quarterly reporting on Helms-Burton determinations; reports on efforts to secure Israel's membership in the UN's Western European and Others Group; reports on resolution of U.S. commercial claims against Saudi Arabia; additional information for inclusion in USAID's Congressional Presentation Documentation; and reports concerning countries providing nuclear fuel to Cuba.