S 903 -- 06/16/97
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June 16, 1997

S. 903 - Foreign Affairs Reform and Restructuring Act of 1997
(Helms (R) North Carolina)

While there are important positive features of S. 903 that the Administration supports, there are also major provisions that the Administration strongly opposes. Significant changes to these provisions will be needed in order to reach agreement on this legislation.

The Administration is supportive of the overall approach on United Nations (UN) reform and arrears taken in Division C of this bill, welcomes the inclusion of most of the State Department authorities sought by the Administration, and wishes to work with the Congress to improve the generally positive authorized funding levels in this bill. However, the Administration strongly opposes provisions related to reorganization of the foreign affairs agencies, and certain foreign policy-related provisions are of serious concern.

Foreign Affairs Reorganization

The President, the Secretary of State and the heads of the relevant agencies are committed to the reorganization, consolidation and reinvention of the foreign affairs agencies as announced by the President on April 18, 1997. Internal deliberations are underway to develop a detailed reorganization plan, consistent with the President's decision, implementation of which will require action by the Congress. The Administration, therefore, would support legislation that provides the President with maximum flexibility and does not prejudge the outcome of these internal deliberations. The Administration, however, strongly opposes legislation which would mandate or micromanage the details of how to implement such a complex reorganization, including detailed provisions related to international broadcasting activities. Such directives would be incompatible with the flexibility needed by the President to reorganize the foreign affairs agencies to meet the challenges of the 21st century.

S. 903 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 has shared language with the Committee, which provides a workable approach to reorganization. Alternatively, the Administration also supports the reorganization provisions contained in H.R. 1757, the Foreign Relations Authorization Act, as passed by the House of Representatives on June 11.

Unfortunately, S. 903 goes well beyond, and in some instances, is inconsistent with the President's decision on reorganization. Therefore, the Administration urges the Senate to adopt either the Administration's alternative or an approach similar to that passed by the House and will work with the Congress to this end as the legislative process continues.

UN Reform and Arrears

The Administration is supportive of the overall approach taken in Division C of this bill, which authorizes an interrelated package of reforms and arrearage payments to the United Nations and other international organizations. While the Administration has concerns with certain provisions of the United Nations Reform Act, the approach represents a major step forward. The Administration will continue to work with the Congress throughout the legislative process to address its concerns.

Foreign Relations Appropriation Authorizations

The Administration is concerned that the appropriation authorization levels in S. 903 for some programs are lower than provided for in the House-passed Foreign Relations Authorization bill, which is consistent with Bipartisan Budget Agreement. Of particular concern is a reduction to State Department operating accounts of $140 million from the Administration's request, because the Machine Readable Visa (MRV) program has not been reauthorized. If MRV fee language cannot be worked out, an additional $140 million should be authorized as an appropriation to the State Department, consistent with the Budget Agreement. Without the funding provided through MRV fees, the Department's ability to protect American's borders, provide consular services to American citizens throughout the world, conduct diplomacy, and continue to move forward on management reforms would be seriously impaired.

In addition, the appropriation authorization for annual assessed contributions to international organizations (CIO) is $59 million less than the President's request. Moreover, the President's request for peacekeeping is reduced by $40 million. Full authorization for these accounts is essential to avoid the reemergence of arrears and so that important foreign policy priorities and unexpected crises in areas of vital importance to U.S. interests can be addressed.

The Administration strongly opposes the reduction in ACDA's appropriation authorization from $46 million to $39 million. Since ACDA and State will be integrated by the end of fiscal year 1998, ACDA will need full funding in FY 1998 in order to successfully restructure while continuing to accomplish all of its national security and arms control missions. ACDA's ability to effectively implement the President's arms control priorities, such as the Nuclear Non-Proliferation Treaty, must not be impacted adversely by such a reduction in funding. For USIA, the Administration appreciates the support shown for public diplomacy programs in S. 903, but opposes reductions in the operating resources needed to support these programs. For both ACDA and USIA, it is imperative that the appropriation authorization reductions be restored.

Foreign Policy Restrictions: Certain foreign policy-related provisions in S. 903 are of concern and need to be deleted or changed as the legislative process continues. The attachment contains examples of policy provisions of concern to the Administration.

The Administration is continuing to review S. 903 and may seek further changes to the bill as the legislative process continues.

Pay-As-You-Go Scoring

S. 903 could 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 estimate is that the PAYGO effect of this bill is zero. Final scoring of this legislation may deviate from this estimate.

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