[Congressional Record Volume 143, Number 80 (Tuesday, June 10, 1997)]
[Senate]
[Pages S5467-S5468]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                 CBO COST ESTIMATES--S. 430 AND S. 210

 Mr. MURKOWSKI. Mr. President, when the Committee on Energy and 
Natural Resources filed its reports on S. 430, the New Mexico Statehood 
and Enabling Act Amendments of 1997 and S. 210, a bill to amend the 
Organic Act of Guam, the Revised Organic Act of the Virgin Islands, and 
the Compact of Free Association Act, and for other purposes, the 
estimates from the Congressional Budget Office were not available. 
Those reports have now been received and I ask that copies be printed 
in the Record for the information of the Senate and the public.
  The material follows:

                                                    U.S. Congress,


                                  Congressional Budget Office,

                                     Washington, DC, May 21, 1997.
     Hon. Frank H. Murkowski,
     Chairman, Committee on Energy and Natural Resources, U.S. 
         Senate, Washington, DC.
       Dear Mr. Chairman: The Congressional Budget Office has 
     prepared the enclosed cost estimate for S. 430, the New 
     Mexico Statehood and Enabling Act Amendments of 1997.
       If you wish further details on this estimate, we will be 
     pleased to provide them. The CBO staff contacts are Marjorie 
     A. Miller (for the state and local impact), and Victoria V. 
     Heid (for federal costs).
           Sincerely,
                                                   June E. O'Neil,
                                                         Director.
       Enclosure.


               CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

     S. 430--New Mexico Statehood and Enabling Act Amendments of 
         1997
       S. 430 would amend the New Mexico Statehood and Enabling 
     Act of 1910 and would consent to amendments to the 
     constitution of the state of New Mexico approved by the 
     voters on November 5, 1996. These amendments generally 
     concern the administration of the state's permanent trust 
     funds. Congressional consent to the amendments to the 
     constitution of the state of New Mexico is required before 
     they can be implemented by the state government.
       CBO estimates the enacting S. 430 would have no effect on 
     the federal budget. Because the bill would not affect direct 
     spending or receipts, pay-as-you-go procedures would not 
     apply. S. 430 contains no intergovernmental or private-sector 
     mandates as defined in the Unfunded Mandates Reform Act of 
     1995 and would impose no costs on state, local, or tribal 
     governments. Enactment of this bill would give New Mexico 
     state officials greater flexibility in investing and 
     distributing the assets of the state's permanent funds.
       The estimate was prepared by Marjorie A. Miller (for the 
     state and local impact), and Victoria V. Heid (for federal 
     costs). This estimate was approved by Paul N. Van de Water, 
     Assistant Director for Budget Analysis.
                                  ____

                                                    U.S. Congress,


                                  Congressional Budget Office,

                                     Washington, DC, June 2, 1997.
     Hon. Frank H. Murkowski,
     Chairman, Committee on Energy and Natural Resources, U.S. 
         Senate, Washington, DC.
       Dear Mr. Chairman: The Congressional Budget Office has 
     prepared the enclosed cost estimate for S. 210, a bill to 
     amend the Organic Act of Guam, the revised Organic Act of the 
     Virgin Islands, and the Compact of Free Association Act, and 
     for other purposes.
       If you wish further details on this estimate, we will be 
     pleased to provide them. The CBO staff contacts are John R. 
     Righter (for federal costs), and Marjorie Miller (for the 
     state and local impact).
           Sincerely,
                                                  June E. O'Neill,
                                                         Director.
       Enclosure.

[[Page S5468]]

               Congressional Budget Office Cost Estimate

     S. 210--A bill to amend the Organic Act of Guam, the Revised 
         Organic Act of the Virgin Islands, and the Compact of 
         Free Association Act, and for other purposes
       Summary: S. 210 would make several changes to existing laws 
     governing the relationship between the United States and the 
     insular areas, which include Guam, the Virgin Islands, the 
     Republic of the Marshall Islands, and others. In addition, 
     the bill would establish the Commission on the Economic 
     Future of the Virgin Islands and the Commission on the 
     Economic Future of American Samoa to recommend policies and 
     programs to assist the Virgin Islands and American Samoa in 
     developing secure and self-sustaining economies.
       Subject to appropriation of the necessary funds, CBO 
     estimates that implementing S. 210 would cost the federal 
     government about $6 million over the 1997-2002 period. In 
     addition, the Joint Committee on Taxation (JCT) estimates 
     that this bill would decrease federal revenues by about $14 
     million over the 2003-2007 period. Enacting this legislation 
     also could affect direct spending by reducing the amount of 
     offsetting receipts from the sale of federal property. Hence, 
     pay-as-you-go procedures would apply to the bill. CBO 
     estimates, however, that any potential loss of such receipts 
     would not be significant.
       S. 210 contains no private-sector or intergovernmental 
     mandates as defined in the Unfunded Mandates Reform Act of 
     1995 (UMRA) and would impose no costs on state, local, or 
     tribal governments.
       Estimated cost to the Federal Government: The estimated 
     budgetary impact of S. 210 is shown in the following table. 
     Assuming appropriation of the amounts specified in the bill 
     for the costs of the proposed commissions and amounts 
     estimated for other costs, CBO estimates that implementing S. 
     210 would cost about $6 million over the 1997-2002 period.

----------------------------------------------------------------------------------------------------------------
                                                                      By fiscal years, in millions of dollars
                                                                 -----------------------------------------------
                                                                   1997    1998    1999    2000    2001    2002
----------------------------------------------------------------------------------------------------------------
                                        SPENDING SUBJECT TO APPROPRIATION
 
Estimated authorization level...................................       1       2       2       1       1   (\1\)
Estimated outlays...............................................   (\1\)       2       2       1       1   (\1\)
----------------------------------------------------------------------------------------------------------------
\1\ Less than $500,000.

       The costs of this legislation fall within budget function 
     800 (general government).
     Basis of estimate
       Spending subject to appropriation
       S. 210 would extend the Department of Agriculture's 
     (USDA's) authority to continue shipping excess food 
     commodities to the Marshall Islands through fiscal year 2001. 
     According to the department, $581,000 was appropriated in 
     fiscal year 1997 for the program. Of that amount, about 
     $525,000 is for food commodities and about $55,000 is for 
     administrative expenses. In addition, the bill would require 
     that the amount of commodities provided to the Marshall 
     Islands reflect changes in its population that have occurred 
     since the enactment of the Compact of Free Association in 
     fiscal year 1986. The amount provided to the program has 
     varied since it began in fiscal year 1987. According to USDA, 
     the program received about $1.6 million in 1987. Between 1988 
     and 1992, the program received, on average, about $465,000 a 
     year. Since fiscal year 1993, $581,000 has been appropriated 
     each year for the program. S. 210 only specifies a base year 
     from which to calculate changes in the islands' population 
     but not a base level of funding. The estimate adjusts the 
     level of funding received in fiscal year 1988--$501,000--for 
     changes in the price level and for changes in the population 
     since fiscal year 1986. (CBO estimates that the population 
     will have increased by about 60 percent between fiscal 
     years 1986 and 1998.) Under these assumptions, extending 
     the program would cost about $5 million over the 1998-2001 
     period.
       The bill also would establish the Commission on the 
     Economic Future of the Virgin Islands and the Commission on 
     the Economic Future of American Samoa to recommend policies 
     and programs to assist the Virgin Islands and American Samoa 
     in developing secure and self-sustaining economies. Both 
     commissions would have six members, and the bill would 
     require that each commission file its report by June 30, 
     1999. The bill would authorize an average of $300,000 a year 
     for fiscal years 1997 through 1999 for the costs of each 
     commission. Assuming the bill would not be enacted until 
     later this year, CBO estimates that outlays for the two 
     commissions would total about $1.2 million over fiscal years 
     1998 and 1999.
       S. 210 also would require, subject to availability of 
     appropriated funds, that the Department of the Interior (DOI) 
     take a census of Micronesia within five years of the 
     decennial census of the United States population. A census of 
     Micronesia would thus be required by fiscal year 2005. The 
     bill would limit expenditures on the census to no more than 
     $300,000. In addition, the bill would repeal a requirement 
     that the Administration report annually to the Congress on 
     the impact of the Compact of Free Association on the 
     territories and the state of Hawaii. According to DOI, it has 
     prepared three such reports since 1986. CBO estimates that 
     savings from repealing this requirement would not be 
     significant.
       Direct spending and receipts
       By granting the government of Guam the right of first 
     refusal on any federal property declared excess on Guam, S. 
     210 could reduce the amount of offsetting receipts from the 
     sale of surplus federal property. However, according to the 
     General Services Administration (GSA) and DOI, a sale of 
     federal property has never occurred on Guam. Also, the bill 
     would require Guam to pay fair market value for any property 
     transferred for private use. Therefore, CBO estimates that 
     the provision would have no significant impact on federal 
     receipts. In most or all cases, CBO expects the federal 
     government would transfer the property anyway to the 
     government of Guam under one of its public purpose programs.
       Under current law, the Virgin Islands is required to secure 
     its bonds with a priority first lien claim on specified 
     revenue streams, rather than being permitted to secure 
     multiple bond issues on a parity basis with a common pool of 
     revenues. JCT estimates that if the priority lien requirement 
     is repealed, the Virgin Islands would issue more tax-
     exempt bonds beginning in fiscal year 2003 than under 
     current law. (Fiscal year 2003 is the earliest that the 
     Virgin Islands can refund outstanding revenue bonds issued 
     on a priority basis.) The increase in tax-exempt bonds, 
     which would lower federal revenues, would occur because 
     the Virgin Islands could secure a greater volume of bonds 
     with the same amount of revenues if a parity approach were 
     permitted. JCT estimates that repealing the priority lien 
     requirement for revenue bonds would decrease federal 
     revenues by $14 million over the 2003-2007 period.
       If the Virgin Islands were also to receive the authority 
     under separate legislation to refund the outstanding revenue 
     bonds prior to their redemption date in fiscal year 2003, JCT 
     estimates that this provision would decrease revenues by an 
     additional $21 million over the 1998-2002 period and by an 
     additional $2 million over the 2003-2007 period. These 
     estimates assume that the Virgin Islands would refund the 
     priority bonds in fiscal year 1998 and thus increase the 
     volume of outstanding tax-exempt bonds. Thus, if S. 210 were 
     enacted after the enactment of separate legislation 
     authorizing the additional advance refunding by the Virgin 
     Islands, JCT estimates that federal receipts would decrease 
     by about $21 million over the 1998-2002 period and by about 
     $37 million over the 1998-2007 period.
       Pay-as-you-go considerations: Section 252 of the Balanced 
     Budget and Emergency Deficit Control Act of 1985 sets up pay-
     as-you-go procedures for legislation affecting direct 
     spending or receipts through 1998. While H.R. 210 could 
     affect direct spending in fiscal year 1998 by reducing the 
     amount of offsetting receipts from the sale of federal 
     property, CBO estimates that any such effect would not be 
     significant.
       Estimated impact on State, local, and tribal governments: 
     S. 210 contains no intergovernmental mandates as defined in 
     UMRA and would impose no costs on state, local, or tribal 
     governments.
       Some of the amendments included in this bill would benefit 
     the affected governments--territories and freely associated 
     states of the United States. Generally, the impact of these 
     changes would be small. For example, the bill would give the 
     government of Guam greater access to excess federal property. 
     It would also give the government of the Virgin Islands 
     additional options for issuing bonds and short-term notes.
       Estimated impact on the private sector: This bill would 
     impose no new private-sector mandates as defined in UMRA.
       Estimate prepared by: Federal Costs: John R. Righter; 
     Impact on State, Local, and Tribal Governments: Marjorie 
     Miller.
       Estimate approved by: Robert A. Sunshine, Deputy Assistant 
     Director for Budget Analysis.
  Mr. LOTT addressed the Chair.
  The PRESIDING OFFICER. The majority leader.
  Mr. LOTT. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The absence of a quorum has been suggested. 
The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. LOTT. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________