    [Budget of the United States Government]
    [V. Investing in the Common Good: Program Performance in Federal Functions]
    [15. Natural Resources and Environment]
    [From the U.S. Government Publishing Office, www.gpo.gov]

    [[Page 195]]

                     15.  NATURAL RESOURCES AND ENVIRONMENT

      ----------------------------------------------------------------------

                     Table 15-1.  Federal Resources in Support of Natural Resources and Environment
                                                (In millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                                   Estimate
                   Function 300                   1999   -----------------------------------------------------------
                                                 Actual     2000      2001      2002      2003      2004      2005
    ----------------------------------------------------------------------------------------------------------------
    Spending:
      Discretionary Budget Authority..........    23,812    24,041    24,940    25,086    25,354    25,957    26,463
      Mandatory Outlays:
        Existing law..........................       313       467       600       734       883       816       756
        Proposed legislation..................  ........  ........      -218       -69      -461      -363      -277
    Credit Activity:
      Direct loan disbursements...............        26        30        34       N/A       N/A       N/A       N/A
      Guaranteed loans........................  ........  ........       100       N/A       N/A       N/A       N/A
    Tax Expenditures:
      Existing law............................     1,480     1,500     1,585     1,645     1,710     1,755     1,820
      Proposed legislation....................  ........  ........         8        41       112       214       315
    ----------------------------------------------------------------------------------------------------------------
    N/A = Not available.

      ----------------------------------------------------------------------
       The Federal Government spends over $24 billion a year to protect the
    environment, manage Federal land, conserve resources, provide
    recreational opportunities, and construct and operate water projects.
    The Federal Government manages about 700 million acres--a third of the
    U.S. continental land area.
       The Natural Resources and Environment function reflects most Federal
    support for natural resources and the environment, but does not include
    certain large-scale environmental programs, such as the environmental
    clean-up programs at the Departments of Energy and Defense. (See chapter
    11, ``National Defense'' and Chapter 14, ``Energy'').
       Within this function, Federal efforts focus on providing cleaner air
    and water, conserving natural resources, and cleaning up environmental
    contamination. The major goals include:
       protecting human health and safeguarding the natural
              environment--air, water, and land--upon which life depends;
       restoring and maintaining the health of federally-managed
              lands, waters, and renewable resources; and,
       providing recreational opportunities for the public to enjoy
              natural and cultural resources.
       The Federal Government made significant progress to achieve these
    goals in 1999. For example, 85 Superfund site cleanups were completed;
    over three million acres of mined lands, refuges, park lands, and
    forests and 128 ``at risk'' cultural sites on public lands were restored
    and protected; and, 95 percent of national park visitors and 93 percent
    of Bureau of Land Management (BLM) recreational users reported being
    satisfied with their visits, which meets or exceeds goals set for
    customer satisfaction for 1999.
       Federal lands include the 379 units of the National Park System, the
    156 National Forests; the 521 refuges in the National Wildlife Refuge
    System; and the 264 million

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    acres managed by the BLM mainly in Alaska and 11 Western States (see
    Chart 15-1).

     Lands Legacy

       In 2001, the $1.4 billion Lands Legacy initiative will allocate $600
    million from the Land and Water Conservation Fund (LWCF) to acquire
    Federal lands and interests and provide grants to States to conserve
    their open space. In addition, Lands Legacy will support: (1)
    conservation and restoration of lands to preserve wildlife habitat,
    natural resources, and historic sites; (2) planning assistance for
    States and local governments to protect local green space, urban parks,
    and greenways; and, (3) Federal and State efforts to restore ocean and
    coastal resources.
       In 2001, Interior will acquire approximately 180,000 acres in
              the California Desert region to complete the Wildlands
              Conservancy acquisition, 3,300 acres to expand refuges in the
              Everglades of South Florida, over 400 acres of prime habitat
              in two national park units on the Virgin Islands, and key
              tracts within the boundaries of six Civil War battlefields.
       In 2001, USDA's Forest Legacy program will support permanent
              easements for 183,000 acres, up from 158,000 acres in 2000.
       In 2001, USDA's Farmland Protection Program, which remains
              part of the Lands Legacy initiative but will be funded through
              the Administration's mandatory farm safety net proposal at $65
              million annually, will protect approximately 130,000 acres of
              farmland threatened by development through permanent
              easements.
       The National Oceanic and Atmospheric Administration (NOAA)
              will increase the number of restored acres of coastal habitat
              by 15,000 acres in 2001.

    [[Page 197]]

       As a complement to the Lands Legacy initiative, the Administration
    will propose the Livable Communities initiative that includes, among
    other components, Better America Bonds, a financing tool funded through
    federal tax credits, that will generate $10.8 billion in bond authority
    over five years for investments by State, local, and Tribal governments.
    Better America Bonds will be used to preserve green space, create or
    restore urban parks, protect water quality, and clean up brownfields and
    other contaminated lands.

     National Parks

       The Federal Government spends over $2 billion a year to maintain a
    system of national parks that covers over 83 million acres in 49 States,
    the District of Columbia, and various territories. Discretionary funding
    for the National Park Service (NPS) has steadily increased (almost five
    percent a year since 1986) and fee receipts have grown from $93 million
    in 1996 to about $180 million in 1999. Yet, the popularity of national
    parks has generated even faster growth in the number of visitors, new
    parks, and additional NPS responsibilities. Over the past 30 years, the
    number of national park units has grown by 50 percent and the number of
    national park visits has increased from 164 million to almost 300
    million today.
       With demands growing faster than available resources, NPS is taking
    new, creative, and more efficient approaches to managing parks and has
    developed performance measures against which to gauge progress. NPS and
    other Department of the Interior bureaus are systematically addressing
    facility maintenance and construction needs through newly established
    five-year lists of priority projects. The bureaus will update these
    lists annually to track progress in addressing top priorities and
    completing funded projects on time and at cost.
       In 2001, NPS will:
       Maintain the percentage of park visitors that summarize their
              experience as good or very good at 95 percent--the 1999
              results of a new survey using an enhanced methodology and
              covering over 300 parks.
       Help State and local governments through NPS partnerships to
              add an additional 500 miles of recreational trails, 750 miles
              of recreational river corridors, and 24,800 acres of
              recreational parkland, compared to 1,380 trail miles, 420
              river miles, and 11,530 parkland acres added in 1999.
       Complete 768 data sets for natural resource inventories in
              2001 out of 2,287 required, compared to 223 completed through
              1999.

     Conservation and Land Management

       The 75 percent of Federal land that makes up the National Forests,
    National Grasslands, National Wildlife Refuges, and the BLM-administered
    public lands also provides significant public recreation. BLM provides
    for nearly 75 million recreational visits a year, while over 35 million
    visitors enjoy wildlife each year at National Wildlife Refuges. With its
    133,000 miles of trails, the Forest Service is the largest single
    supplier of public outdoor recreation, providing 341 million
    recreational visitor days last year.
       Federal lands also provide other benefits. With combined annual
    budgets of about $5 billion, BLM and the U.S. Forest Service (USFS)
    manage lands for multiple purposes, including outdoor recreation, range,
    timber, watershed, wildlife and fish, and wilderness. BLM, USFS, and NPS
    have been identified by the Vice President's National Partnership for
    Reinventing Government as High-Impact Agencies. As part of the efforts
    to cut red tape and streamline processes, these agencies produced an
    integrated nationwide outdoor recreation information system that gives
    all Americans quick and easy electronic access to information about
    recreation use, permits, and reservations on Federal lands.
       Some high-priority reinvention projects include:
      ``Service First'': Proposed in the 1996 Reinventing Government report,
    USFS and BLM are working together to deliver seamless service to
    customers and ``boundaryless'' care for the land. This began as two
    pilot projects in Colorado and Oregon to: improve customer service with
    one-stop shopping; achieve efficiencies in operations to reduce or avoid

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    costs; and, take better care of the land by taking a landscape approach
    to stewardship rather than stopping at the traditional jurisdictional
    boundaries. USFS and BLM are also looking to streamline major business
    processes to make them work better for both employees and customers.
       Financial Management: USFS is implementing a new general ledger
    system and re-engineering its budget process to better align budget
    planning and execution with the agency's strategic goals. The 2001
    Budget will be presented to Congress using a clear, redesigned budget
    structure that connects funding categories to performance measures. In
    this way, forest managers are given the resources to manage the forests
    with increased accountability in achieving defined goals.
       In 2001, the USFS, along with BLM, will propose to decouple their
    mandatory programs from timber receipts. In 2000, the level of funding
    for USFS staff to carry out timber stand improvement depends upon the
    volume of timber harvested. This system has the potential to create an
    incentive for staff to increase timber production in order to increase
    payments--an effect that is often times at odds with a desire to manage
    the national forests according to scientifically determined criteria.
    The revised policy would restore management and increase accountability,
    by severing the linkage between program spending and timber harvest
    volumes, and thereby eliminate concerns that the funds influenced
    management decisions and financed organizational costs. The new
    mandatory account structure will preserve funding at known, fixed, and
    dependable amounts and display budget information more visibly, allowing
    the agency, Congress and the public an expanded role in funding priority
    and allocation decisions.
       BLM and USFS concentrate on the long-term goal of providing
    sustainable levels of multiple uses while ensuring and enhancing
    ecological integrity. Their performance measures include:
       USFS in 2001 will target increased funding to needed
              watershed restoration work by increasing acres of watershed
              restoration work by 25 percent (to 25,000 acres) over 2000
              levels of 20,0000 acres; increasing the acres of noxious weed
              control by 52 percent (to 85,000 acres) over 2000 levels of
              56,000 acres; maintaining the pace of obliterating existing
              roads at the 2000 level (2,500 miles), as compared to 1,200
              miles in 1998; and increasing the number of acres treated for
              fire hazard reduction to a minimum of 1.5 million, compared to
              a 2000 planned level of 1.3 million.
       For priority watersheds, BLM will enhance the ecological
              integrity of an additional 2,000 miles of riparian areas and
              135,000 acres of wetlands in 2001, compared to 1,700 miles and
              128,000 acres enhanced in 1999; BLM will also treat 300,000
              acres for fire hazard reduction by prescribed fire and
              mechanical means, compared to 1997 levels of 70,000 acres.
       The Interior Department's Fish and Wildlife Service (FWS), with a
    budget of $1.75 billion, manages 94 million acres of refuges and, with
    the Commerce Department's National Marine Fisheries Service (NMFS),
    protects species on Federal and non-Federal lands.
       In 2001, FWS will again ensure that the refuge acreage is
              protected, of which 3.5 million acres will be enhanced or
              restored. In 1999, FWS met its goal of enhancing or restoring
              3.3 million acres of refuge land.
       FWS will also increase by one million acres the number of
              protected, non-Federal acres in Habitat Conservation Plans up
              from 2.5 million in 1999; keep 20 more species off the
              endangered species list, compared to a 1998 baseline of seven
              species kept off the list; and, improve or stabilize the
              populations of 37 percent of species listed a decade or more,
              over a 1998 baseline of 36 percent.
       NMFS will implement programs in 2001 to reduce the number of
              overfished fisheries from 95 to 74 out of the 286 overfished
              stocks.
       Half of the continental United States is crop, pasture, and
    rangeland. Two percent of Americans manage this land--farmers and
    ranchers. The Department of Agriculture's (USDA) Natural Resources
    Conservation Service provides technical assistance to them to improve
    land management practices.

    [[Page 199]]

       Under USDA's Wetlands Reserve Program (WRP), the Federal Government
    buys long-term or permanent easements from landowners that take the land
    out of production and restore it to wetlands. Landowners receive up to
    100 percent of the fair market agricultural value for the land and cost-
    share assistance to cover the wetland restoration expenses. At the end
    of 2000, cumulative acreage in the WRP will total 935,000.
       In 2001, WRP acreage enrollment activity will reach the
              authorized cap of 975,000 acres. In support of the
              Administration's farm safety net proposal and the Clean Water
              Action Plan, the 2001 budget proposes to increase enrollment
              to 250,000 acres annually through 2010.
       USDA will use a number of programs to address the goals
              outlined in the Clean Water Action Plan's Animal Feeding
              Operations Strategy, resulting in the installation of 15,000
              animal waste management systems to protect water from
              agricultural pollution, an increase of 64 percent over 2000.
       Through several programs, USDA will also implement resource
              management systems to control erosion and improve habitat on
              6.0 million acres of grazing lands, compared to 5.8 million
              acres in 2000.
       USDA's Environmental Quality Incentives Program (EQIP), which
    provides funds to farmers and ranchers to adopt sound conservation
    practices, will again target funds in 2001 to conservation priority
    areas such as Maine's Penobscot Nation and Texas's Edwards Aquifer.
    These areas use EQIP funds to address problems ranging from erosion to
    threatened and endangered species to water quality. The budget proposes
    $325 million in mandatory funding for EQIP, a $151 million increase
    above 2000, in support of the farm safety net proposal and the Clean
    Water Action Plan. For more information on conservation and USDA's
    investment in land management, see Chapter 18, ``Agriculture.''

     Everglades and California Bay-Delta Restoration

       Federal and non-Federal agencies are carrying out long-term
    restoration plans for several nationally significant ecosystems, such as
    those in South Florida and California's Bay-Delta. The South Florida
    ecosystem is a national treasure that includes the Everglades and
    Florida Bay. Its long-term viability is critical for the tourism and
    fishing industries, and for the water supply, economy, and quality of
    life for South Florida's six million people. Economic development and
    water uses in California's San Francisco Bay-San Joaquin Delta watershed
    have diminished water quality, degraded wildlife habitat, endangered
    several species, and reduced the estuary's reliability as a water source
    for two-thirds of Californians and seven million acres of highly
    productive agricultural land.
       The Vice President announced the completion of the comprehensive plan
    to restore the Everglades on July 1, 1999. This plan will also
    accommodate other demands for water and related resources in South
    Florida. The Administration will submit legislation to authorize this
    plan in 2000. By September 30, 2002, five of the 68 currently known
    federally endangered and threatened species in South Florida will be
    able to be ``down-listed'' or removed from the list.
       The Bay-Delta program expects during 2000 to select the preferred
    long-term plan to solve critical water-related problems in the
    California Bay-Delta. The plan will contain specific, measurable
    performance goals for levee protection, ecosystem restoration, and water
    conservation, storage, and conveyance.
       In 2001, as part of implementing that plan, participating
              agencies expect to make up to 200,000 acre-feet of water
              available to Federal water project contractors that would not
              otherwise have been available.

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     Scientific Support for Natural Resources

       The management of lands, the availability and quality of water, and
    improvements in the protection of resources are based on sound and
    objective natural resources science. Interior's U.S. Geological Survey
    (USGS) provides research and information to land managers and the public
    to better understand ecosystems and species habitat, land and water
    resources, and natural hazards. In 1999, USGS provided impartial
    scientific information by delivering results from more than 900
    investigations to natural resource managers, other decision-makers, and
    the public to assist sound natural resource management.
       In 2001, the USGS will participate in the Lands Legacy initiative
    with a budget that includes $50 million for this initiative, including
    $30 million to the Community/Federal Information Partnership, an
    interagency effort to provide communities with the geospatial
    information and GIS technological assistance they need to make sound
    planning decisions and preserve open space. Communities will also
    receive earth science data to improve mapping, data analysis, and
    planning capabilities.
       The Commerce Department's NOAA manages ocean and coastal resources in
    the 200-mile Exclusive Economic Zone and in 12 National Marine
    Sanctuaries. Its National Ocean Service and NMFS manage 201 fish stocks,
    163 marine mammal populations, and their associated coastal and marine
    habitats. NOAA's National Weather Service (NWS), using data collected by
    the National Environmental Satellite and Data Information Service,
    provides weather forecasts and flood warnings. Its Office of Oceanic and
    Atmospheric Research provides science for policy decisions in areas such
    as climate change, air quality and ozone depletion.
       In 2001, NWS' ongoing modernization will increase the lead
              time of flash flood warnings to 57 minutes and the accuracy of
              flash flood warnings to 70 percent; increase the lead time of
              severe thunderstorm warnings to 21 minutes and the accuracy of
              severe thunderstorm warnings to 86 percent, and increase the
              accuracy of heavy snowfall forecasts to 65 percent. Since
              1986, lead times for severe thunderstorm and tornado warnings
              has improved significantly. For example, in 1986 the lead time
              for severe thunderstorm warnings was 12 minutes versus 21
              minutes lead time in 2001.

     Pollution Control and Abatement

       The Federal Government helps achieve the Nation's pollution control
    goals by: (1) taking direct action; (2) funding actions by State, local,
    and Tribal governments; and, (3) implementing an environmental
    regulatory system. The Environmental Protection Agency's (EPA) $7.3
    billion in discretionary funds and the Coast Guard's $140 million Oil
    Spill Liability Trust Fund (which funds oil spill prevention and
    cleanup) finance the activities in this subfunction. EPA is an NPR High
    Impact Agency whose discretionary funds have three major components--the
    operating program, Superfund, and water infrastructure financing.
       EPA's $3.9 billion operating program provides the Federal funding to
    implement most Federal pollution control laws, including the Clean Air,
    Clean Water, Resource Conservation and Recovery, Safe Drinking Water,
    and Toxic Substances Control Acts. EPA protects human health and the
    environment by developing national pollution control standards, largely
    enforced by the States under EPA-delegated authority. For example, under
    the Clean Air Act, EPA works to make the air clean and healthy to
    breathe by setting standards for ambient air quality, toxic air
    pollutant emissions, new pollution sources, and mobile sources.
       In 2001, EPA will certify that five of the estimated 38
              remaining nonattainment areas have achieved the one-hour
              National Ambient Air Quality Standard (NAAQS) for ozone (see
              Chart 15-2).

       In 2001, air toxic emissions nationwide from stationary and
              mobile sources combined will be reduced by five percent from
              2000 (for a cumulative reduction of 35 percent from the 1993
              level of 4.3 million tons).
       Under the Clean Water Act, EPA works to conserve and enhance the
    ecological health of the Nation's waters, through regulation of point
    source discharges and through multi-

    [[Page 201]]

    agency initiatives such as the Administration's Clean Water Action Plan.
       In 2001, water quality will improve on a watershed basis such
              that 550 of the Nation's 2,150 watersheds will have greater
              than 80 percent of assessed waters meeting all water quality
              standards, up from 500 watersheds in 1998.
       Under the Federal Insecticide, Fungicide, and Rodenticide Act and the
    Federal Food, Drug, and Cosmetic Act, EPA regulates pesticide use,
    grants product registrations, and sets tolerances (standards for
    pesticide residue on food) to reduce risk and promote safer means of
    pest control. EPA also seeks to reduce environmental risks where
    Americans reside, work, and enjoy life, through pollution prevention and
    risk management strategies.
       In 2001, EPA will reassess an additional 1,200 of the 9,721
              existing pesticide tolerances to ensure that they meet the
              statutory standard of ``reasonable certainty of no harm'' (for
              a cumulative 60 percent), including an additional 208 of the
              848 tolerances having the greatest potential impact on dietary
              risks to children (for a cumulative 66 percent).
       In 2001, the quantity of Toxic Release Inventory pollutants
              released, disposed of, treated, or combusted for energy
              recovery (normalized for changes in industrial production)
              will be reduced by 200 million pounds, or two percent, from
              2000 reporting levels.
       In 2001, EPA will initiate safety reviews on chemicals
              already in commerce by obtaining data on an additional 10
              percent of the 2,800 high-production volume chemicals on the
              master testing list, as part of the implementation of a
              comprehensive strategy for screening, testing, classifying,
              and managing the risks posed by commercial chemicals.
       Under the Resource Conservation and Recovery Act, EPA and authorized
    States prevent dangerous releases to the environment of hazardous,
    industrial nonhazardous, and municipal solid wastes by requiring proper
    facility

    [[Page 202]]

    management and cleanup of environmental contamination at those sites.
       In 2001, 106 more hazardous waste management facilities will
              have approved controls in place to prevent dangerous releases
              to air, soil, and groundwater, for a total of 70 percent of
              2900 facilities.
       EPA's underground storage tank (UST) program seeks to prevent,
    detect, and correct leaks from USTs containing petroleum and hazardous
    substances. Regulations issued in 1988 required that substandard USTs
    (lacking spill, overfill and/or corrosion protection) be upgraded,
    replaced or closed by December 22, 1998.
       In 2001, 93 percent (an estimated 651,000) of active USTs
              will be in compliance with these requirements, which improves
              upon the 65 percent (approximately 553,800) of then-active
              USTs in compliance as of the December 22, 1998, deadline. Over
              the past decade, more than 1.4 million substandard USTs have
              been permanently closed.
       In October 1997, the President announced immediate actions to begin
    addressing the problem of global climate change, and included the
    Climate Change Technology Initiative (CCTI) in the 1999 Budget. This
    budget provides $227 million for the third year of EPA's portion of
    CCTI, much of which focuses on the deployment of underutilized but
    existing technologies that reduce greenhouse gas emissions. The
    partnerships EPA has built with business and other organizations since
    the early 1990s will continue to be the foundation for reducing
    greenhouse gas emissions in 2001 and beyond.
       In 2001, greenhouse gas emissions will be reduced from
              projected levels by approximately 66 million metric tons of
              carbon equivalent per year through EPA partnerships with
              businesses, schools, State and local governments, and other
              organizations. This reduction level will be an increase of
              eight million metric tons over 2000 reduction levels.
       In 2001, EPA will develop the infrastructure to implement the
              Clean Air Partnership Fund, which will demonstrate smart
              multi-pollutant approaches that reduce greenhouse gases, air
              toxics, soot, and smog.
       The $1.45 billion Superfund program pays to clean up hazardous spills
    and abandoned hazardous waste sites, and to compel responsible parties
    to clean up. The Coast Guard implements a smaller but similar program to
    clean up oil spills. Superfund also supports EPA's Brownfields program,
    designed to assess, clean up, and re-use former industrial sites.
       In 2001, EPA will complete 75 Superfund cleanups, continuing
              on a path to reach 900 completed cleanups by the end of 2002;
              it completed 85 cleanups in 1999.
       In 2001, EPA Brownfields funding will result in 200 site
              assessments (for a cumulative total of 2,100), 500 jobs
              generated (for a cumulative total of 5,400), and the
              leveraging of $100 million in cleanup and redevelopment funds
              (for a cumulative total of $1.8 billion).
       In 2001, the Coast Guard will reduce the rate of oil spilled
              into the Nation's waters to 4.62 gallons per million gallons
              shipped from a statistical baseline of 5.25 gallons in 1998.
      EPA water infrastructure funds provide capitalization grants to State
    revolving funds, which make low-interest loans to help municipalities
    pay for wastewater and drinking water treatment systems required by
    Federal law. The $1.625 billion in the 2001 Budget is consistent with
    the Administration's plans to capitalize these funds to the point where
    the Clean Water State Revolving Funds (CWSRF) and the Drinking Water
    State Revolving Funds (DWSRF) provide a total of $2.5 billion in average
    annual assistance. The $74 billion in Federal assistance since passage
    of the 1972 Clean Water Act has dramatically increased the portion of
    Americans enjoying better quality water; nearly 181 million people now
    receive the benefits of secondary treatment of wastewater. Ensuring that
    community water systems meet health-based drinking water standards is
    supported by both the DWSRF and operating program resources.
       In 2001, 500 CWSRF projects will initiate operations,
              including 300 projects pro

    [[Page 203]]

              viding secondary treatment, advanced treatment, CSO correction
              (treatment), and/or storm water treatment. A cumulative total
              of 6,200 projects will have initiated operations since
              inception of the program.
       In 2001, 91 percent of the population served by community
              water systems will receive drinking water meeting all health-
              based standards in effect as of 1994, up from 83 percent in
              1994.
       USDA gives financial assistance to rural communities to provide safe
    drinking water and adequate wastewater treatment facilities to rural
    communities. The budget proposes $1.6 billion in combined grant, loan,
    and loan guarantees for this assistance, a 24-percent increase over the
    2000 program level. Part of those funds will go toward the Water 2000
    initiative to bring indoor plumbing and safe drinking water to under-
    served rural communities. Since 1994, USDA has invested almost $2.1
    billion in loans and grants on high-priority Water 2000 projects Nation-
    wide. The Administration proposes continuing the Water 2000 initiative
    into 2001, based on its successful five year record of targeting funds
    to underserved communities, leveraging resources from other public and
    private sources, and maintaining the strong loan repayment record of the
    Water and Waste Disposal program.
      In 2001, USDA will fund 350 high-priority water 2000 projects.
      The Office of Surface Mining (OSM), in partnership with States,
    reclaims abandoned coal mines and restores the lands to productive use
    for communities using funds from the Abandoned Mine Lands Reclamation
    Fund.
       In 2001, OSM will reclaim 9,100 acres of abandoned coal mine
              lands, 1,000 acres more than in 2000.

     Water Resources

       The Federal Government builds and manages water projects for
    navigation, flood-damage reduction, environmental purposes, irrigation,
    and hydropower generation. The Army Corps of Engineers operates Nation-
    wide, while Interior's Bureau of Reclamation operates in the 17 western
    States. The budget proposes $4.9 billion for the agencies in 2001--$4.1
    billion for the Corps, $0.8 billion for the Bureau. The budget includes
    a proposal to create a new Harbor Services Fund to increase funding for
    the Corps' operations, maintenance, and construction activities at our
    Nation's ports and harbors and help ensure a safe and economically
    competitive port system. The budget also includes $135 million for
    Everglades infrastructure projects and $20 million for Challenge 21, an
    initiative to restore riverine ecosystems while providing flood hazard
    mitigation for communities. While navigation and flood damage reduction
    remain major missions of the Corps, its responsibilities increasingly
    have expanded to include the restoration of aquatic and wetland
    ecosystems.
       In 2001, the Corps will:
       Maintain controlled commercial navigation and flood damage-
              reduction facilities in a fully operational state at least 95
              percent of the time.
       Achieve ``no net loss'' of wetlands by creating, enhancing,
              and restoring wetlands functions and values that are
              comparable to those lost when the Corps issues permits to
              allow wetlands to be developed.
       The Bureau of Reclamation manages, develops, and protects water and
    related resources in an environmentally and economically sound manner in
    the interest of the American public.
       Over the past few years, the Bureau has continued to supply water and
    power efficiently throughout the West. In 1999, the Bureau delivered or
    released 30.7 million acre-feet of water to Reclamation-owned and
    operated facilities, 3.7 million over the minimum contracted amounts
    due. It also generated power needed to meet contractual commitments and
    other requirements 100 percent of the time.
       In 2001, the Bureau will deliver or release the amount of
              water contracted for from Reclamation-owned and operated
              facilities, expected to be no less than 28 million acre-feet,
              and generate power needed to meet contractual commitments and
              other requirements 100 percent of the time, depending upon
              water availability.

    [[Page 204]]

     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 investments, and quickly write-off reforestation costs--in
    total, costing about $610 million in 2001. The mining industry benefits
    from percentage depletion provisions (which sometimes allows deductions
    that exceed the economic value of resource depletion) and can deduct
    certain exploration and development costs--together, costing about $265
    million in 2001.
      In 2001, Better America Bonds will provide tax incentives for State
    and local governments to protect local green spaces, improve water
    quality, and clean up abandoned industrial sites.