SUBCOMMITTEE ON THE DEPARTMENT OF THE INTERIOR AND RELATED AGENCIES JULIA BUTLER HANSEN, Washington, Chairman SIDNEY R. YATES, Illinois GUNN MCKAY, Utah CLARENCE D. LONG, Maryland FRANK E. EVANS, Colorado JOSEPH M. McDADE, Pennsylvania J. David Willson and Byron S. Nielson, Staff Assistants DEPARTMENT OF THE INTERIOR RECISSION AND DEFERRAL OF BUDGET AUTHORITY TUESDAY, NOVEMBER 19, 1974. WITNESSES ROYSTON HUGHES, ASSISTANT SECRETARY FOR PROGRAM DEVELOPMENT AND BUDGET FRANK WILES, DIRECTOR, OFFICE OF BUDGET OPENING REMARKS Mrs. HANSEN. The committee will come to order. The purpose of this hearing is to consider proposals which have been submitted by the President for rescission and deferral of budget authority. These are the first proposals which have been submitted pursuant to the Congressional Budget and Impoundment Control Act of 1974 and this is the first time that the subcommittee has considered such proposals. Under the provisions of that act, Congress may concur in a proposed rescission by passing a rescission resolution within 45 days. Deferral proposals are automatically effective unless either House passes a resolution of disapproval. Today we will consider proposals for the Department of the Interior and the Forest Service. We will begin with the Interior Department and our principal witness is Mr. Royston Hughes, Assistant Secretary for Program Development and Budget. RESCISSION AND DEFERRAL MESSAGES We will insert the appropriate sections of House Document 93-361 and House Document 93-365 in the record at this point. [The information follows:] (71) Deferral No.: D75-13 DEFERRAL OF BUDGET AUTHORITY Report Pursuant to Sec. 1013 of Public Law 93-344 14X5136 OREGON AND CALIFORNIA GRANT LANDS Annual appropriation bill language in recent years consistently provides that 25 percent of current year receipts from Oregon and California grant lands be used to fund this account. The account provides for management, development, and protection of Federal Oregon and California grant lands including the construction, and maintenance of roads. The President's budget estimated 25 percent of 1975 receipts to be $28,750,000, and a program was designed to obligate that amount. The budget predicted that $5,243,000 of unobligated balances from prior years would be carried into FY 1975 and a like amount would be carried into FY 1976. Subsequent to preparation of the budget, $3,500,000 planned for use in 1974 was deferred until 1975; thus, the current estimate of 1975 obligations is $32,250,000. The 1975 budget authority estimate has now been increased by the Department of the Interior to $47,200,000 because of higher estimated prices for sawtimber. The program plan for use of the funds has not been changed. Therefore, the total amount now expected to be deferred through FY 1975 is $23,693,000-$5,243,000 originally planned plus the $18,450,000 increase. The program plan remains the same as budgeted because the management, protection, and development opportunities are largely independent of sawtimber prices. Pecause budget authority is based on current year receipts, the budget authority available for a year is never finally known until the end of the year. For these reasons, carryovers are retained as a cushion for the possibility that receipts turn out to be lower than anticipated. Failure to do this could result in over programing. As receipts estimates are changed after submission of the President's budget, the program level is held relatively constant as a matter of sound management practice and the changes in funding are accounted for by adjusting the amount deferred. This may either be an increase or decrease in the amount deferred. This is a reserve for contingencies (81 U.S.C. 665). ESTIMATED EFFECTS Obligation in FY 1975 of all the deferred funds would result in $12 million of expenditures in 1975. The remainder would be expended in 1976. 7 Rescission Proposal No.: R75-6 PROPOSED RESCISSION OF BUDGET AUTHORITY REPORT PURSUANT TO SEC. 1012 OF PUBLIC LAW 93-344 Agency: Interior. Bureau: Bureau of Land Management. Appropriation Title and Symbol: Public Lands Development Roads and Trails-14X1113. New budget authority (23 U.S.C. 203) Other budgetary resources_ Total budgetary resources_ Amount proposed for rescission___ Justification $10, 000, 000 29, 011, 000 39, 011, 000 4,891, 000 The $4,120,000 programmed for the Public Lands Development Roads and Trails represents the funding required to support resource development and use plans for the public lands in 1975. The Federal Aid Highway Act of 1970 provides contract authority of $5 million for 1972 and $10 million for 1973 to be available for two years subsequent to the fiscal year for which it is authorized. The Federal Aid Highway Act of 1973 provides additional contract authority of $10. million for each of fiscal years 1974, 1975 and 1976 and authorizes use of this authority one year in advance of and two years subsequent to the fiscal year for which it is authorized. Under the existing program, $4,891,000 of contract authority will lapse on June 30, 1975, and $30 million will be carried into 1976. The 1975 program level has been prepared considering resource development and use opportunities and the associated benefit/cost relationships to the extent possible. The program for road development in any one year is based on estimated requirements to meet the objectives for multiple use resource development and use plans on the national resource lands. This program is reviewed annually by the Congress when it takes action on the appropriation required to liquidate obligations under existing contract authority. Thus, the amount of contract authority made available has been implicitly approved by the Congress. Estimated effects Rescission of these funds will have no adverse effects on the program in future years. The $4,891,000 proposed for rescission is 1973 contract authority which will lapse at the end of this fiscal year. If this unneeded contract authority were made immediately available, those projects that have unfavorable benefit/cost relationships would be funded. These projects would yield either limited benefits over the life of the project, benefits that can only be realized several years in the future, or both results. This proposed rescission and the de 8 ferral of $30 million in this account are consistent with a program level that provides optimum utilization of available funds. If the amounts proposed for recission, the deferred amounts or both the amounts were to be made immediately available for obligation, the program level would increase by $3.1 million in 1975 and outlays by approximately $.8 million in 1975 and $2.3 million in 1976. DEPARTMENT OF THE INTERIOR BUREAU OF LAND MANAGEMENT PUBLIC LANDS DEVELOPMENT ROADS AND TRAILS Contract authority provided for the fiscal year 1973 by Section 105 (a) (8) of the Federal-Aid Highway Act of 1970 (P.L. 91–605) for "Public lands development roads and trails" is rescinded in the amount of $4,891,000. Rescission Proposal No.: R75–7 PROPOSED RESCISSION OF BUDGET AUTHORITY REPORT PURSUANT TO SEC. 1012 OF PUBLIC LAW 93-344 Agency: Interior. Bureau: National Park Service. Appropriation Title and Symbol: Road Construction-14X1037. New budget authority (23 U.S.C. 203). Other budgetary resources-- Total budgetary resources_. Amount proposed for rescission__. $105, 000, 000 254, 098, 456 359, 098, 456 14, 000. 000 The Federal Aid Highway Act of 1970 provides contract authority of $20 million for 1972 and $50 million for 1973. The contract authority is available for the two subsequent years after the year for which it was authorized. In addition, the Federal Aid Highway Act of 1973 provides contract authority of $90 million for 1974, $105 million for 1975, and $105 million for 1976, and authorizes use one year in advance of the year for which it was authorized. The amount proposed for rescission will lapse at the end of the current fiscal year. The President's 1975 budget proposed a construction program of $33,000,000. The agency plan for use of contract authority in FY 1975 has not been completed. As a consequence, the funds planned for use in 1975 are under review and subject to change. Obligation of all available CA would result in the low-priority use of scarce Federal financial resources. Many of the facilities and interpretive systems which these projects could serve are not yet planned or are not needed until future years. Historically, Congress has provided contract authority for this program in excess of the Park Service's construction capacity. The program level in each year, however, has reflected a level of obligations implicitly approved by the Congrss in its review of the action on the appropriation required to liquidate obligations under existing contract authority. Estimated effects It is unlikely there would be a significant increase in the program even if the additional contract authority were made available. If this authority is not rescinded, it is unlikely that a substantial portion of it could be obligated this fiscal year for the reasons stated. DEPARTMENT OF THE INTERIOR NATIONAL PARK SERVICE PARK ROADS AND TRAILS Contract authority provided for fiscal year 1973 by Section 105 (a) (9) of the Federal-Aid Highway Act of 1970 (P.L. 91-605) for "Park roads and trails" is rescinded in the amount of $14,000,000. Deferral No.: D75-39 DEFERRAL OF BUDGET AUTHORITY REPORT PURSUANT TO SEC. 1013 OF PUBLIC LAW 93-344 Agency: Department of Health, Education, and Welfare. Appropriation Title and Symbol: 75X0391-Indian Health Facilities. New budget authority (Public Law Amount to be deferred part of year.... ). Amount to be deferred for entire year. $55, 407, 599 88,000 Justification During 1974, $55,320,000 appropriated by P.L. 93-120 was apportioned for Indian Health Facilities. A prior year balance carried forward of $88,000 has been reserved. This amount was appropriated in 1967 to plan for a replacement of the hospital at Harlem, Montana. The actual award of planning funds has been delayed in accordance with the Indian Health Service's need to plan for the construction of facilities in greater need of replacement. The 1975 budget, however, includes funds for upgrading the 43-year-old, 15-bed facility to meet. the National Fire Protection Association standards. It is expected that the deferred funds for project planning will be made available for obligation in the fourth quarter of FY 1975. Estimated effects There will be no programmatic impact in 1975. This deferral was anticipated in the 1975 budget estimate and, therefore, will not result in substantial savings in 1975. The outlay effect in subsequent years is negligible and will not effect current outlay projections through 1977. |