[Budget of the U.S. Government]
[VI. Investing in the Common Good: The Major Functions of the Federal Government]
[16. Natural Resources and Environment]
[From the U.S. Government Publishing Office, www.gpo.gov]
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16. NATURAL RESOURCES AND ENVIRONMENT
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Table 16-1. FEDERAL RESOURCES IN SUPPORT OF NATURAL RESOURCES AND ENVIRONMENT
(In millions of dollars)
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Estimate
Function 300 1996 -----------------------------------------------------------------
Actual 1997 1998 1999 2000 2001 2002
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Spending:
Discretionary Budget Authority... 20,668 21,071 22,393 22,393 21,848 21,741 21,829
Mandatory Outlays:
Existing law................... 667 1,045 1,012 863 911 907 843
Proposed legislation........... ......... ......... 113 74 62 97 104
Credit Activity:
Direct loan disbursements........ 34 45 38 37 37 39 40
Tax Expenditures:
Existing law..................... 1,650 1,670 1,680 1,690 1,705 1,685 1,655
Proposed legislation............. ......... -8 -89 -92 -94 -96 -97
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The Federal Government spends over $20 billion a year to protect the
environment, conserve Federal resources, provide recreational
opportunities, and construct and operate water projects. \1\ The Federal
Government manages about 700 million acres--a third of the U.S.
continental land area--including 25 million acres managed by the Defense
Department (DOD) and 56 million that the Interior Department holds in
trust for Indian Tribes and individual Indians. The lands generate about
$2.7 billion in receipts a year, mainly from royalties and revenues from
the oil and gas, coal, and timber industries. About half of the receipts
go to the Federal Treasury, the rest to States and to various Federal
land and water resource programs. The Government also allocates nearly
$1 billion a year in tax incentives for natural resource industries,
especially timber and mining.
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\1\ The Natural Resources and Environment function does not reflect
total Federal support for the environment and natural resources. It does
not include, for instance, the environmental clean-up programs at the
Departments of Energy and Defense.
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Federal lands include the National Park System, with such unique
resources as Grand Canyon National Park, Everglades National Park,
Yellowstone National Park and Gettysburg National Military Park; the 156
National Forests that the Forest Service manages for various uses,
including timber harvesting, wildlife habitat, and recreation; the
National Wildlife Refuge System, comprising 510 refuges for the
conservation of migratory birds and other important species; and the 264
million acres that the Bureau of Land Management (BLM) manages in 11
Western States for economic, conservation, and recreational purposes.
Visitors make about 700 million recreational visits a year on Federally-
owned lands.
Federal spending on natural resources and the environment also
includes the Environmental Protection Agency (EPA), for which the budget
proposes $7.6 billion in 1998. EPA implements most of the Nation's major
environmental laws, including the Clean Air, Clean Water, and Safe
Drinking Water Acts; administers the Superfund program; and finances
water infrastructure projects.
Largely due to Federal efforts, the air and water are cleaner across
most of the
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United States, and a much larger share of Americans are
served by secondary wastewater treatment. Our natural resources are
better conserved--with national forests and public rangelands returned
to sustainable levels of productivity, soil erosion substantially
reduced, thousands of wetland acres restored, unique ecosystems
protected, contaminated areas cleaned up by a record rate, and billions
of dollars in flood damages averted. Formerly endangered or threatened
species like bald eagles, wolves, and condors again grace the landscape
in the lower 48 States. Finally, one of America's best inventions--its
national park system--has been improved and preserved for future
generations.
Parks and Recreation
The Federal Government invests over $1.4 billion a year to maintain
the National Park System, which has 374 parks, covering over 83 million
acres in 49 States, the District of Columbia, and various territories.
The popularity of national parks has prompted a steady rise in
congressional funding (almost five percent a year since 1986) for the
National Park Service (NPS), but has generated even faster growth in the
number of new parks and other NPS responsibilities. Since 1986, the
number of national parks has grown by 10 percent, including the five
designated in the 1996 Omnibus Parks Act. NPS also maintains an
infrastructure of aging facilities, fragile ruins, and declining
historic structures.
So, with demands growing faster than available funding (and with an
estimated 280 million park visitors in 1996), NPS is taking new,
creative approaches to managing parks, including broader cooperative
arrangements with public and private groups. The Government, for
instance, is establishing the Tallgrass Prairie National Preserve in
Kansas at substantially less cost than a traditional national park unit,
due to a partnership with a private group that owns most of the land. At
the Presidio of San Francisco, a government corporation will be able to
lease and manage hundreds of unused buildings in a manner consistent
with park purposes, but that cuts taxpayer costs. More park managers
also are accepting the support of individuals and corporate citizens
that donate their time and money to help protect national parks.
Finally, NPS is seeking additional resources by asking Congress for
permanent authority to collect fees and retain all the receipts from new
fees, and for reforms in park concessions policies to increase
competition for concessions contracts and provide incentives for parks
to negotiate higher returns from concessioners.
Conservation and Land Management
How we use the public lands that BLM manages (the 264 million acres
in 11 Western States) has evolved over time--and continues to. To meet
changing and diverse demands, BLM is promoting both biological diversity
and the sustainable development of natural resources. In 1996, BLM
provided for nearly 65 million recreational visits while accommodating
more traditional users, including 20,000 Western ranchers, the timber
industry, and other commercial interests.
BLM and the Forest Service, with combined annual budgets of about $3
billion, manage Federal forests for multiple purposes. Federal forest
lands in the Pacific Northwest and northern California were plagued by
conflict between environmentalists and industry over logging and,
eventually, a court injunction that brought Federal timber sales to a
virtual halt in 1991. To end the impasse, the President established his
Northwest Forest Plan in 1994. Now, Federal forest management is nearing
a fully sustainable level. The Federal Government offered for sale over
1.7 billion board feet from Federal forest lands in Washington, Oregon,
and northern California from 1994 to 1996--enough to build 142,000
average homes and employ about 11,700 people. The Forest Plan also
supports area communities by distributing grants and loans to help over
100 communities further diversify their economies.
Federal and non-Federal agencies also are implementing long-term
restoration plans for the South Florida and Bay-Delta, California
ecosystems. The South Florida ecosystem is a national treasure that
includes the Everglades, Florida Bay, and other internationally-renowned
natural resources. Its long-term viability and sustainability is
critical for the tourism and fishing industries, as well as
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for the water supply, economy, and quality of life for South Florida's
population of over six million people. As with South Florida, the lack
of enough clean water in the San Francisco Bay-San Joaquin Delta
ecosystem has reduced the quality and quantity of wildlife habitat,
endangered several species, and reduced the estuary's reliability as a
source of high quality water.
The Interior Department's Fish and Wildlife Service (FWS) and
Commerce Department's National Marine Fisheries Service (NMFS) protect
species under the Endangered Species Act (ESA) while allowing economic
development to continue. To protect species on non-Federal lands, these
agencies work with States and local governments, private groups, and
landowners to develop Habitat Conservation Plans (HCPs), which provide
the flexibility and certainty that everyone needs to plan for, and use,
their land. From 1983 to 1992, such parties devised only 14 HCPs but,
from 1993 to 1997, the number issued or under development soared to
300--covering 8.4 million acres in the Pacific Northwest alone. To
protect species on Federal lands, Federal agencies consult with State
and local governments, groups, and others before allowing private
parties to use the land.
Another important land conservation program is the Land and Water
Conservation Fund (LWCF), which uses the royalties of offshore oil and
gas leases to help Federal, State, and local governments acquire land
for conservation and outdoor recreation. From its inception in 1964, the
program has helped Federal, State, and local governments to acquire
about seven million acres of parks and other lands. The program, for
instance, is funding the acquisition of Sterling Forest in New York and
New Jersey, the largest undeveloped tract of forest and open lands
within 45 miles of downtown New York City, thus creating vast new
recreational opportunities for the whole area.
Half of the continental United States is cropland, pastureland, and
rangeland owned and managed by two percent of Americans--farmers and
ranchers. The Agriculture Department's (USDA) Natural Resources
Conservation Service provides these private interests with technical
assistance to ensure the health and sound management of this land. Other
USDA programs mainly provide financial conservation assistance, the
largest of which is the Conservation Reserve Program (CRP) through which
USDA can maintain up to 36 million acres under land retirement
contracts, reducing soil erosion by over 600 million tons a year. The
1996 Farm Bill should greatly enhance CRP's conservation benefits. Under
it, for instance, producers may enroll partial fields into the CRP
(e.g., filterstrips, riparian buffer areas, and grassed waterways) to
gain the maximum conservation for the least cost.
Pollution Control and Abatement
The Federal Government helps achieve the Nation's pollution control
goals in three ways. It (1) takes direct action, (2) funds action by
State, local, and Tribal governments, and the private sector, and (3)
imposes mandates on these parties. The Environmental Protection Agency's
(EPA) $7 billion discretionary budget and the Coast Guard's $100 million
Oil Spill Liability Trust Fund (which funds oil spill clean-ups in U.S.
waters) finance the first two activities. EPA's discretionary budget, in
turn, has three major parts--the operating program, Superfund, and water
infrastructure financing.
EPA's $3 billion operating program is the main Federal
funding source to implement most Federal pollution control
laws, including the Clean Air, Clean Water, Solid Waste
Disposal, Safe Drinking Water, and the Toxic Substance Control
Acts. EPA protects public health and the environment by
developing national pollution control standards, which States
largely implement and enforce under the authority that EPA
delegates. These standards have led to major environmental
improvements. EPA's pollution abatement efforts since 1970
also have generated major environmental improvements (see
Chart 16-1).
Superfund's $2 billion program pays for cleaning up hazardous
substance spills and abandoned hazardous waste sites, and for
compelling responsible parties to clean up inactive sites--
with a goal of 900 completed cleanups by the year 2000 of the
roughly 1,400 sites on EPA's high-priority
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list. Private parties subject to Superfund's enforcement spend
another $2 billion a year, and Federal agencies (largely DOD and the
Energy Department) spend about $5 billion a year on hazardous
waste cleanup. Superfund also supports the Federal brownfields
program, designed to assess, clean up, and re-use former
contaminated sites.
Federal water infrastructure funds go primarily for
capitalization grants to State revolving funds, which make
low-interest loans to help municipalities pay for wastewater
treatment and drinking water treatment systems, as Federal law
requires. The more than $67 billion in Federal assistance
since the 1972 Clean Water Act has dramatically increased the
percentage of Americans served by secondary treatment (as
shown in Chart 16-2) and better water quality. State and local
governments (and private companies) also benefit from a tax
break (costing $700 million in 1998) allowing State and local
governments to issue tax-exempt bonds to construct private
waste disposal facilities.
Water Resources
The Army Corps of Engineers and Interior's Bureau of Reclamation are
the main Federal agencies that build and operate multi-purpose water
projects. The Corps operates Nation-wide, while the Bureau operates in
the 17 western States. They both seek to develop or manage water
resources to meet changing needs. The budget proposes $4.6 billion for
the agencies in 1998--$3.7 billion for the Corps, $0.9 billion for the
Bureau.
While navigation and flood damage reduction remain the Corps'
major focus, its projects, programs, and regulatory
responsibilities increasingly address environmental
objectives, including wetlands protection. The Administration
will work with Congress to develop a consensus on priorities
for the Corps Civil Works program in an era of stable or
falling budgets.
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The Bureau was designed to support economic development in
the West by financing and constructing reliable water supplies
for irrigation and hydropower generation. With the West
developed, the Bureau has sought since the late 1980s to
remake itself into a customer-oriented ``water resources
management'' agency, operating projects more efficiently and
providing expertise on the best way to manage water resources,
consistent with sound environmental and economic objectives.
Regulation
Millions of Americans have benefited not just from the spending
programs discussed above, but from Federal regulations that are designed
to protect the environment and public health. In issuing regulations,
however, the Administration has sought to carefully protect the public
without unduly burdening private interests. In this area and in others,
the Administration has worked to eliminate unnecessary regulations while
improving the regulations that are clearly necessary.
State, local, and Tribal governments and the private sector devote
considerable resources to comply with Federal environmental laws and
regulations to make the air and water cleaner and reduce risks from
hazardous wastes.
Tax Incentives
The tax code offers incentives for natural resource industries,
especially timber and mining. The timber industry can deduct certain
costs for growing timber, pay lower capital gains rates on profits, take
a credit for investment, and quickly write-off reforestation costs--all
told, costing about $500 million in 1998. The mining industry benefits
from percentage depletion provisions (which allow deductions that exceed
the economic value of resource depletion) and can deduct certain
exploration and development costs--together, costing about $335 million
in 1998.