[House Report 109-95]
[From the U.S. Government Publishing Office]



109th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     109-95

======================================================================
 
  MILITARY QUALITY OF LIFE AND VETERANS AFFAIRS, AND RELATED AGENCIES 
                       APPROPRIATIONS BILL, 2006

                                _______
                                

  May 23, 2005.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

    Mr. Walsh, from the Committee on Appropriations, submitted the 
                               following

                              R E P O R T

                             together with

                            ADDITIONAL VIEWS

                        [To accompany H.R. 2528]

    The Committee on Appropriations submits the following 
report in explanation of the accompanying bill making 
appropriations for military quality of life functions of the 
Department of Defense, military construction, the Department of 
Veterans Affairs, and related agencies for the fiscal year 
ending September 30, 2006.

                                CONTENTS

                                                                   Page
Purpose of the Bill..............................................     2
Conformance With Authorization Bill..............................     3
Summary of Committee Recommendation..............................     4
Items of Interest................................................    15
Military Construction:
    Army.........................................................    19
    Navy and Marine Corps........................................    20
    Air Force....................................................    21
    Defense-wide.................................................    22
    Army National Guard..........................................    22
    Air National Guard...........................................    23
    Army Reserve.................................................    24
    Naval Reserve................................................    24
    Air Force Reserve............................................    24
NATO Security Investment Program.................................    24
Family Housing Overview..........................................    25
Family Housing:
    Army.........................................................    26
    Navy and Marine Corps........................................    27
    Air Force....................................................    28
    Defense-wide.................................................    28
Department of Defense Family Housing Improvement Fund............    29
Chemical Demilitarization Construction, Defense-wide.............    29
Base Realignment and Closure Account 1990........................    30
Base Realignment and Closure Account 2005........................    30
Basic Allowance for Housing:
    Army.........................................................    30
    Navy.........................................................    30
    Marine Corps.................................................    31
    Air Force....................................................    31
    Army National Guard..........................................    31
    Air National Guard...........................................    31
    Army Reserve.................................................    31
    Naval Reserve................................................    32
    Marine Corps Reserve.........................................    32
    Air Force Reserve............................................    32
Facilities Sustainment, Restoration and Modernization:
    Army.........................................................    32
    Navy.........................................................    33
    Marine Corps.................................................    33
    Air Force....................................................    34
    Defense-wide.................................................    34
    Army National Guard..........................................    34
    Air National Guard...........................................    34
    Army Reserve.................................................    35
    Naval Reserve................................................    35
    Marine Corps Reserve.........................................    35
    Air Force Reserve............................................    35
Environmental Restoration:
    Army.........................................................    36
    Navy.........................................................    36
    Air Force....................................................    36
    Defense-wide.................................................    36
    Formerly Used Defense Sites..................................    36
Defense Health Program:
    Operation and Maintenance....................................    39
    Procurement..................................................    42
    Research and Development.....................................    43
Administrative Provisions........................................    45
Department of Veterans Affairs:
    Veterans Benefits Administration.............................    48
    Veterans Health Administration...............................    52
    Departmental Administration..................................    59
    Administrative Provisions....................................    63
American Battle Monuments Commission.............................    65
U.S. Court of Appeals for Veterans Claims........................    66
Cemeterial Expenses, Army........................................    67
Armed Forces Retirement Home.....................................    67
General Provisions...............................................    68
Changes in Application of Existing Law...........................    68
Appropriations Not Authorized by Law.............................    69
Transfer of Funds................................................    71
Constitutional Authority.........................................    72
Comparisons With Budget Resolution...............................    72
Five-Year Projection of Outlays..................................    73
Financial Assistance to State and Local Governments..............    73
Statement of General Performance Goals and Objectives............    73
Full Committee Votes.............................................    74
State List.......................................................    75
Additional Views.................................................    95

                          Purpose of the Bill

    This bill marks the introduction of the first Military 
Quality of Life and Veterans Affairs, and Related Agencies 
Appropriations bill. The Committee has formed this bill for the 
purpose of moving towards taking a more comprehensive look at 
the quality of life for U.S. servicemen and women, from 
recruitment through retirement. Since the advent of the All 
Volunteer Force in 1973, quality of life has come to play an 
increasingly prominent role in preserving the unmatched 
professionalism and capability of the U.S. armed forces. All of 
the military witnesses who have testified before the Committee 
in preparation for this bill have spoken in full support of the 
new structure of the bill highlighting the importance of 
maintaining a suitable quality of life for soldiers, sailors, 
airmen and marines. This quality of life necessarily involves 
the construction and maintenance of military facilities and 
housing, the basic allowance for housing, the Defense Health 
Program, and environmental restoration. Several witnesses 
affirmed the saying, ``you recruit the soldier and you retain 
the family,'' and all of these elements contribute to that 
purpose, while maintaining a high level of readiness.
    Quality of life should also be a guiding concept upon a 
service member's retirement, making veterans affairs another 
primary component in achieving the purpose of this bill. The 
Committee heard repeatedly during hearings of gaps and flaws in 
the transition from active duty to retirement, particularly in 
the switch from active duty health care to veterans health 
care. Unacceptable in peacetime, this situation becomes 
intolerable in a time of war. Advances in battlefield medicine 
have resulted in dramatic increases over previous conflicts in 
the percentage of service personnel who survive their wounds. 
The other side of this salutary change is an increase in 
certain medical cases, such as amputee and trauma cases. The 
Committee is deeply concerned that wounded veterans receive the 
treatment they require and deserve. The Committee will thus 
continue in the future to examine opportunities for improving 
quality of life for active and reserve personnel, veterans, and 
those making the transition from active to veteran status.
    The programs funded in the bill for the Department of 
Defense (DOD) include: military construction, including 
housing; operation and maintenance of family housing; the 
family housing improvement fund; the basic allowance for 
housing payment; facilities sustainment, restoration and 
modernization; environmental restoration; the Defense Health 
Program; the U.S. share of the North Atlantic Treaty 
Organization Security Investment Program; funds to execute 
projects identified by the base realignment and closure 
authorities; the chemical demilitarization construction 
program; and the foreign currency fluctuation account. The bill 
also funds the Department of Veterans Affairs (VA). Finally, 
the bill funds four related agencies, including the American 
Battle Monuments Commission, Cemeterial Expenses, Army, the 
U.S. Court of Appeals for Veterans Claims, and the Armed Forces 
Retirement Home.

                  Conformance With Authorization Bill

    On May 12, 2005, the Readiness Subcommittee of the Armed 
Services Committee reported out its section of the National 
Defense Authorization Act for 2006. At this time, conference 
action on the legislation has not concluded; therefore, 
projects in this bill are approved subject to authorization.

                  Summary of Committee Recommendation

    The Committee recommends $121,783,618,000 in new budget 
authority for the programs and activities funded in the bill. 
This recommendation is $1,050,081,000 above the President's 
request and $7,396,777,000 above the fiscal year 2005 enacted 
level. Included in this amount is $35,654,933,000 in mandatory 
authority and $85,158,000,000 in discretionary authority. The 
following table compares amounts recommended in the bill to the 
President's request and amounts appropriated in fiscal year 
2005:


                           Items of Interest

    Post Traumatic Stress Disorder.--There has been a great 
deal of concern that current military operations in Iraq and 
Afghanistan will result in a large number of service members 
returning with psychological problems and that there is a lack 
of care available. The Committee believes that hardships 
resulting from U.S. troop deployments to Iraq and Afghanistan 
make it imperative for the VA and DOD to offer thorough and 
wide-ranging mental health services for active duty and reserve 
members deployed to combat theaters as well as for their 
families. The Committee is concerned that sufficient mental 
health services are lacking to treat combat and mental 
illnesses that affect our soldiers and veterans. Additionally, 
there is a concern that the stresses of deployment are having 
an adverse effect on the families of deployed service members 
and that mental health services will not be available to them.
    According to the Department of Defense, across all 
programs, mental health support is available to individual 
service members before, during and after deployment. Post 
Traumatic Stress Disorder (PTSD) was added to the manual of 
mental health diagnoses primarily as a result of the long-term 
experience of veterans of the Vietnam War. Treatment for PTSD 
involves a combination of medication, psychotherapy, and group 
therapy.
    Military personnel returning from Operation Enduring 
Freedom (OEF) and Operation Iraqi Freedom (OIF) are given 
education on depression and PTSD prior to redeployment and are 
screened during redeployment, using the Post-Deployment Health 
Assessment process. The Department of Defense is making use of 
the Internet to provide improved access to information and 
mental health care in order to reduce the stigma with seeking 
mental health services.
    The Committee directs the Department of Veterans Affairs 
and Department of Defense to jointly study mental healthcare, 
the onset and nature of PTSD, panic disorder, and bipolar 
disorder. Also, to improve mental health testing, tracking of 
returning combat duty servicemen, to include the Reserve 
Component for a period of not less than 10 years. In addition, 
the Departments of Defense and Veterans Affairs are encouraged 
to establish a classification for psychiatric nurses, and 
increase hires of individuals with those capabilities.
    The Committee notes that more than 20 years ago, the 
Congress established a Department of Veterans Affairs Special 
Committee on Post Traumatic Stress Disorder to determine the 
Department's capacity to provide assessment and treatment for 
PTSD and to guide the Department's educational, research, and 
benefits activities with regard to PTSD. The Special Committee 
has provided the Department of Veterans Affairs and the 
Congress with annual reports that contain recommendations for 
improving PTSD programs and some progress has been made. But it 
is also clear from the most recent report, dated October, 2004, 
that much more needs to be done so that this issue is given its 
proper attention.
    First and foremost, the VA must prepare to meet the needs 
of a new generation of combat veterans, many of whom are still 
in uniform. This requires, according to the report, a 
prospective approach including the earliest possible 
identification and treatment of post traumatic readjustment 
problems and the prevention of chronic PTSD. Since many post 
combat individuals remain on active duty, the Departments of 
Defense and Veterans Affairs must work together to identify at-
risk individuals early on and coordinate treatment options and 
benefits at the on-set to minimize long-term consequences. 
During demobilization, every returning service member completes 
the Post Deployment Evaluation Screen (Form 2796). Although 
Post Deployment Evaluation Screen results include essential 
information about stressors and about signs of post traumatic 
responses, they are not currently being made available for VA 
planners or clinicians. The Special Committee believes this 
must change in order for the VA to have important information 
should an individual present to the VA for treatment. The 
Committee directs the DOD and VA to report on the obstacles to 
providing such information to the VA and possible remedies.
    For those individuals who serve in Guard and Reserve 
components, who return to civilian life after deployment and 
thus don't have a ``support community'' at hand, special 
efforts must be made to identify potential problems once 
individuals have settled in to their former lives. This is the 
most vexing challenge for the VA, but it is not insurmountable. 
As the report of the Special Committee notes, Guard and Reserve 
troops have 90 days of leave before they report again for 
weekend duty following deployment. After this 90 days, 
according to the report, would be an ideal time to adopt as the 
standard period after which the post deployment mental health 
intervention would be made, using mental health professionals 
leading small group discussions of the experiences the troops 
faced. The Committee believes this recommendation deserves 
serious consideration and directs the DOD and VA to report on 
their plans for establishing such a procedure.
    With regard to VA capabilities, the Special Committee has 
had a long-running recommendation that every VA Medical Center 
have a PTSD Clinical Team (PCT), yet two decades after the 
recommendation was first put forth, only 86 of 163 VA medical 
centers have PCTs. Coupled with this fact is the VA's growing 
reliance on Community Based Outpatient Clinics and the lack of 
PTSD service at those locations. The Committee notes that the 
Department estimates it will spend at least $2,200,000,000 on 
specialty mental health programs in fiscal year 2006, and the 
entirety of health care supporting veterans with mental illness 
will approach $10,000,000,000. By way of illustration, during 
fiscal year 2002, a total of 202,862 veterans had a clinical 
visit in which PTSD was a focus of treatment, but only 29 
percent of these veterans received treatment in a specialized 
PTSD program. VA's primary care program is a de facto mental 
health system for the majority of those seeking VA care. But 
the VA must ensure that PTSD services are provided in Primary 
Care settings by design, not by default. To provide the true 
continuum of care necessary to treat PTSD effectively, the 
Primary Care services need to be fully integrated with general 
mental health and specialty PTSD services. The VA has a long 
road to travel before this becomes the actual practice, but 
effective PCTs at the VA Medical Centers will provide the basis 
to travel down that road. The Committee is very concerned about 
this lack of responsiveness to the Special Committee 
recommendation in this regard and directs the VA to develop a 
plan for implementation of effective PCTs at each VA Medical 
Center and identify any resource shortfalls which would impede 
implementation.
    Seamless Transition from Active Duty to Veterans Affairs.--
Healthcare is a great concern for our active duty and reserve 
components, their dependents as well as our retirees. Placing 
the military health care system and the veterans health care 
system in one bill has allowed the committee to explore 
coordinated efforts and efficiencies within the two systems. 
The Committee believes this will enable a comprehensive health 
care system to meet the needs of our soldiers and their 
dependents as well as retirees.
    An over arching concern of this Committee as well as for 
Congress, is the seamless transition from active duty to 
veteran and what medical services are available for soldiers 
and their families. Today the age of the retiree is much more 
prevalent as parents are talking on behalf of their children as 
they transition to retiree status. The VA established an Office 
of Seamless Transition in 2003. This office is to improve 
coordination between the Veterans Health Administration, the 
Veterans Benefits Administration, and the Department of Defense 
to ensure that appropriate veterans affairs policies and 
procedures are in place to enhance the continuity of care as 
the soldiers' transition to the various health care and 
disability services available within both Departments. The 
Committee understands that DOD is coordinating with this office 
on many programs, but believes more could be done.
    Also established in 2003 was a joint DOD/VA Seamless 
Transition Program at Walter Reed Army Medical Center (WRAMC) 
to provide case management for combat veterans. This program 
has expanded to the National Naval Medical Center and to the 
Brooke, Eisenhower, Fort Hood, Madigan and Evans Army Medical 
Centers.
    To further improve the transition, in April 2004 the Army 
and the VA announced the Disabled Soldier Support System (DS3) 
designed to assist severely disabled soldiers and their 
families during transition from military service to civilian 
life. The DS3 provides personal outreach to disabled soldiers 
to ensure accessibility and responsiveness of DOD, VA and 
civilian services, including medical care, family services, and 
other support services. Soldiers will be followed for five 
years after retirement to ensure they receive the TRICARE and 
VA benefits for which they are eligible.
    In February 2005, DOD announced the Military Severely 
Injured Joint Support Operations Center, designed to ensure 
that service members with severe injuries have accessibility to 
all available resources. The Center will act as a core resource 
for injured service members and their families and as a 
supplement to service-specific programs. It ties together DOD 
and other government programs such as those run by the VA and 
the Department of Labor. The Center is intended to coordinate 
several existing programs such as DS3 and Marine for Life, but 
not replace them.
    Additional programs for all service members and their 
families include Military One Source, DOD Deployment Health 
Clinical Center, Cooperative Separation Physical Examination 
Process for DOD and VA with 51 locations in the United States 
and the Family Assistant Centers at 419 locations in the United 
States established by the National Guard.
    Since late 2003, DOD has provided updated rosters, on a 
recurring basis to the VA of those who served in OIF and OEF 
and then separated from active duty. VA has used these lists to 
determine the rates of VA health care utilization by OIF and 
OEF veterans, including the most frequent diagnoses made during 
hospitalizations and clinic visits. VA uses these lists to send 
out mass mailings about the availability of VA health care and 
benefits. To date, the VA has provided medical care to 49,000 
veterans of OIF and OEF and has received claims for disability 
compensation from 38,000 veterans.
    The DOD/VA Deployment Health Working Group, which was 
established under the DOD/VA Health Executive Council, provides 
leadership on issues related to deployed service members. This 
Working Group has served as a forum to inform the VA about 
disease and injury data from combat theaters, about DOD data on 
environmental surveillance in theater, and clinical research 
issues related to mental health.
    Information Sharing.--An additional concern of the 
Committee is the integration of IT systems and records sharing. 
There are seven initiatives fostering interoperability between 
DOD and VA health information systems. They include the Federal 
Health Information Exchange (FHIE) which enables the transfer 
of protected electronic health information from DOD to VA at 
the time of a service member's separation; the Bidirectional 
Health Information Exchange (BHIE) which enables near real-time 
sharing of allergy, outpatient prescription and demographic 
data between DOD and VA for patients treated in both; 
Consolidated Health Informatics (CHI) which DOD serves as a 
leading partner with the Department of Veterans Affairs and 
with the managing partner, the Department of Health and Human 
Services to advance the nation in the adoption of a portfolio 
of existing health information interoperability standards; a 
Centralized Credentials Quality Assurance System/VetPro where 
the VA and DOD have developed a prototype interface to support 
data sharing between their systems; a Laboratory Data Sharing 
Interoperability (LDSI) that facilitates the electronic sharing 
of laboratory order entry and results retrieval among DOD, VA 
and commercial reference laboratories; a Clinical Data 
Repository/Health Data Repository that establishes 
interoperability between DOD's Clinical Data Repository and the 
VA's Health Data Repository; and lastly the Federal Health 
Architecture (FHA) initiative managed by the Department of 
Health and Human Services that links business processes to IT 
solutions demonstrating improvements in health outcomes.
    The Committee is encouraged by these initiatives and 
directs the Department of Defense and Veterans Affairs to 
continue to examine the synergies that exist between the two 
Departments that will enhance the continuity of care for our 
military families and retirees. The Committee directs the DOD 
and VA to report back to the Committee by February 1, 2006 on 
any internal or external obstacles that exist to prevent such a 
transition along with plans and recommendations.
    Facilities Sustainment, Restoration and Modernization.--The 
Department is directed to continue describing on form 1390 the 
backlog of SRM requirements at installations with future 
construction projects. For troop housing requests, form 1391 
should describe any SRM conducted in the past two years. 
Likewise, future requirements for unaccompanied housing at the 
corresponding installation should be included. Additionally, 
the forms should include English equivalent measurements for 
projects presented in metric measurement. Rules for funding 
repairs of facilities under the Operation and Maintenance 
account are described below:
     Components of the facility may be repaired by 
replacement. Such replacement can be up to current standards or 
codes.
     Interior arrangements and restorations may be 
included as repair.
     Additions, new facilities, and functional 
conversions must be performed as military construction 
projects. Such projects may be done concurrently with repair 
projects as long as the final conjunctively funded project is a 
complete and usable facility.
     The appropriate service secretary shall notify the 
appropriate committees 21 days prior to carrying out any repair 
project with an estimated cost in excess of $7,500,000.
    Reprogramming Criteria.--Reprogramming requests are 
required for military construction projects when the increase 
equals or exceeds 25 percent of the appropriated amount or 
$2,000,000, whichever is less.
    Backlog of Facilities Restoration and Modernization.--The 
Committee is concerned that the current operations tempo is 
increasing the backlog of restoration and modernization at 
installations across all services. The Committee therefore 
directs each service and the Department of Defense to report to 
the Committee on the backlog of restoration and modernization, 
including (1) the backlog by facility type, (2) the 
installations at which the backlog is most severe (including 
overseas installations), and (3) trends in the backlog over the 
past five fiscal years for which data is available. These 
reports are due no later than 90 days after the enactment of 
this Act.
    Full Funding of Facilities Sustainment.--The Committee 
commends the Army for its 90-90 funding initiative for 
Sustainment, Restoration and Modernization (SRM) and Base 
Operations Support (BOS). This initiative is discussed in 
further detail under Military Construction, Army in this 
report. While the Committee recognizes that the services do not 
follow the same practices in estimating and budgeting for 
sustainment requirements, the Committee urges all the services 
and the Department to consider the implementation of 
initiatives that will make full funding of SRM and BOS costs a 
visible priority.

                                TITLE I


                         DEPARTMENT OF DEFENSE


                      Military Construction, Army





Fiscal year 2005 appropriation........................    $1,962,108,000
Fiscal year 2006 budget request.......................     1,479,841,000
Committee recommendation in the bill..................     1,652,552,000
Comparison with:
    Fiscal year 2005 appropriation....................     (309,556,000)
    Fiscal year 2006 budget request...................       172,711,000


    The Committee recommends an appropriation of $1,652,552,000 
for Military Construction, Army, for fiscal year 2006. This is 
a decrease of $309,556,000 below the fiscal year 2005 enacted 
level and an increase of $172,711,000 above the budget request.
    Maryland--Fort Detrick: Research Acquisition Building.--Of 
the amount provided for planning and design in this account, 
the Committee directs that not less than $540,000 be made 
available for the design of this facility.
    Maryland--Fort Detrick: Satellite Communications 
Facility.--Of the amount provided for planning and design in 
this account, the Committee directs that not less than 
$1,206,000 be made available for the design of this facility.
    Virginia--Fort Belvoir: National Ground Intelligence Center 
Facility Expansion.--Of the amount provided for planning and 
design in this account, the Committee directs that not less 
than $211,000 be made available for the design of this 
facility.
    Overhead Cover Systems.--Within the appropriation for 
Military Construction, Army, the Committee recommends an 
additional amount of $50,000,000 for overhead cover systems for 
force protection in Iraq.
    Fort Ord.--The Committee is aware that the Army and the re-
use authority at the former Fort Ord have begun discussions to 
develop creative means to transfer the remaining surplus land 
at the base to the re-use authority prior to the completion of 
clean up activities at the site. The Committee encourages the 
Army and the re-use authority to explore the use of an 
environmental services cooperative agreement. Such an 
arrangement would allow the Army to transfer the land 
immediately but guarantee the re-use authority access to funds 
to pursue clean up through third parties. The Committee asks 
the Army to provide the Committee with a report no later than 
December 1, 2005 on the progress and status of this effort.

              Military Construction, Navy and Marine Corps





Fiscal year 2005 appropriation........................    $1,180,397,000
Fiscal year 2006 budget request.......................     1,029,249,000
Committee recommendation in the bill..................     1,109,177,000
Comparison with:
    Fiscal year 2005 appropriation....................      (71,220,000)
    Fiscal year 2006 budget request...................        79,928,000


    The Committee recommends an appropriation of $1,109,177,000 
for Military Construction, Navy and Marine Corps, for fiscal 
year 2006. This is a decrease of $71,220,000 below the fiscal 
year 2005 enacted level and an increase of $79,928,000 above 
the budget request.
    California--NAWC Weapons Division China Lake: Air Traffic 
Control Tower.--Of the amount provided for planning and design 
in this account, the Committee directs that not less than 
$710,000 be made available for the design of this facility.
    Florida--NS Mayport: Wharf Upgrades.--Of the amount 
provided for planning and design in this account, the Committee 
directs that not less than $500,000 be made available for the 
design of this project.
    North Carolina--Outlying Landing Field.--The Committee is 
aware that the U.S. District Court for the Eastern District of 
North Carolina has ruled that the Navy did not fulfill its 
obligations under the National Environmental Policy Act when 
making a decision to construct an Outlying Landing Field in 
Washington and Beaufort Counties in North Carolina. The 
Committee urges the Navy to fully reconsider alternative sites 
in cooperation with the State of North Carolina.
    Energy Conservation.--In the fiscal year 2005 House report 
accompanying the Military Construction Appropriations Act, 
2005, the Committee encouraged the Navy to expand opportunities 
to use advanced photovoltaic technology such as the use of 
triple junction amorphous silicon photovoltaic roofing in 
military construction projects. The Committee understands the 
Navy has begun exploring this potential technology with 
industry. The Committee requests a report no later than January 
15, 2006 on actions taken to incorporate this technology into 
specific project proposals.

                    Military Construction, Air Force





Fiscal year 2005 appropriation........................      $844,531,000
Fiscal year 2006 budget request.......................     1,069,640,000
Committee recommendation in the bill..................     1,171,338,000
Comparison with:
    Fiscal year 2005 appropriation....................     (326,807,000)
    Fiscal year 2006 budget request...................       101,698,000


    The Committee recommends an appropriation of $1,171,338,000 
for Military Construction, Air Force, for fiscal year 2006. 
This is an increase of $326,807,000 above the fiscal year 2005 
enacted level and an increase of $101,698,000 above the budget 
request.
    The Committee understands the Air Force is developing new 
long-range munitions and is looking at several sites for 
required testing. The Committee also understands the citizens 
of Taylor County, Florida, through a straw poll, overwhelmingly 
rejected a resolution to locate the testing range in that 
County. The Committee urges the Air Force to give full 
consideration to local community concerns throughout the 
decision process.
    Arizona: Davis-Monthan Air Force Base.--It is the 
Committee's understanding that the residents of Pima County, 
Arizona approved in May 2004 a bond issue to facilitate the 
acquisition of land around Davis-Monthan Air Force Base to 
prevent encroachment upon the base from urban development. It 
is also the Committee's understanding that the Air Force has 
not studied the potential problem of encroachment upon the 
base, and has not developed any estimate of the requirements 
for a land buffer. The Committee believes that the willingness 
of the citizens of Pima County to work with the Air Force to 
plan for land use around Davis-Monthan AFB in order to protect 
the base's mission merits consideration. The Committee 
therefore requests the Air Force to report to the Committee no 
later than January 31, 2006 on the potential for encroachment 
upon Davis-Monthan AFB, as well as potential land-use solutions 
to prevent or mitigate such encroachment.
    Mississippi--Columbus AFB: Consolidated Mission Support 
Group Facility.--Of the amount provided for planning and design 
in this account, the Committee directs that not less than 
$900,000 be made available for the design of this facility.
    Montana--Malmstrom AFB: Add/Alter Fitness Center.--Of the 
amount provided for planning and design in this account, the 
Committee directs that not less than $990,000 be made available 
for the design of this facility.
    New Mexico--Kirtland AFB: Wyoming Boulevard.--Of the amount 
provided for planning and design in this account, the Committee 
directs that not less than $550,000 be made available for the 
design of this project.
    Texas--Sheppard AFB: Base Operations Ramp.--Of the amount 
provided for planning and design in this account, the Committee 
directs that not less than $900,000 be made available for the 
design of this facility.
    Utah--Hill AFB: Missile Storage Facilities Consolidation.--
Of the amount provided for planning and design in this account, 
the Committee directs that not less than $800,000 be made 
available for the design of this project.
    Washington--Fairchild AFB: Mission Support Complex, Air 
Education and Training Command.--Of the amount provided for 
planning and design in this account, the Committee directs that 
not less than $706,000 be made available for the design of this 
facility.
    Wyoming--F.E. Warren AFB: Storm Water Drainage.--Of the 
amount provided for planning and design in this account, the 
Committee directs that not less than $900,000 be made available 
for the design of this project.

                  Military Construction, Defense-wide





Fiscal year 2005 appropriation........................      $663,318,000
Fiscal year 2006 budget request.......................     1,042,730,000
Committee recommendation in the bill..................       976,664,000
Comparison with:
    Fiscal year 2005 appropriation....................       313,346,000
    Fiscal year 2006 budget request...................      (66,066,000)


    The Committee recommends an appropriation of $976,664,000 
for Military Construction, Defense-wide, for fiscal year 2006. 
This is an increase of $313,346,000 above the fiscal year 2005 
enacted level and a decrease of $66,066,000 below the budget 
request. Within this appropriation is $50,000,000 for the 
Energy Conservation Improvement Program, the same as the fiscal 
year 2005 level and $10,000,000 below the budget request. Also 
within this appropriation, the Committee recommends $5,000,000 
for contingency construction, which is $5,000,000 below the 
fiscal year 2005 enacted level and $5,000,000 below the 
request.

               Military Construction, Army National Guard





Fiscal year 2005 appropriation........................      $446,748,000
Fiscal year 2006 budget request.......................       327,012,000
Committee recommendation in the bill..................       410,624,000
Comparison with:
    Fiscal year 2005 appropriation....................      (36,124,000)
    Fiscal year 2006 budget request...................        83,612,000


    The Committee recommends an appropriation of $410,624,000 
for Military Construction, Army National Guard, for fiscal year 
2006. This is a decrease of $36,124,000 below the fiscal year 
2005 enacted level and an increase of $83,612,000 above the 
budget request.
    Iowa--Iowa City: Readiness Center/Field Maintenance Shop.--
Of the amount provided for planning and design in this account, 
the Committee directs that not less than $431,000 be made 
available for the design of this project.
    Nebraska--Lincoln: Joint Forces Headquarters.--Of the 
amount provided for planning and design in this account, the 
Committee directs that not less than $956,000 be made available 
for the design of this project.
    Tennessee--Kingsport: Joint Armed Forces Reserve Center.--
Of the amount provided for planning and design in this account, 
the Committee directs that not less than $918,000 be made 
available for the design of this project.
    Tennessee--Tullahoma: Readiness Center.--Of the amount 
provided for planning and design in this account, the Committee 
directs that not less $602,000 be made available for the design 
of this project.

               Military Construction, Air National Guard





Fiscal year 2005 appropriation........................      $238,043,000
Fiscal year 2006 budget request.......................       165,256,000
Committee recommendation in the bill..................       225,727,000
Comparison with:
    Fiscal year 2005 appropriation....................      (12,316,000)
    Fiscal year 2006 budget request...................        60,471,000


    The Committee recommends an appropriation of $225,727,000 
for Military Construction, Air National Guard, for fiscal year 
2006. This is a decrease of $12,316,000 below the fiscal year 
2005 enacted level and an increase of $60,471,000 above the 
budget request.
    California--March ARB: Replace Aircraft Maintenance Hangar 
and Shops.--Of the amount provided for planning and design in 
this account, the Committee directs that not less than $960,000 
be made available for the design of this facility.
    Illinois--Peoria Regional Airport: Replace Composite ASOC/
ASOS Training Facility.--Of the amount provided for planning 
and design in this account, the Committee directs that not less 
than $790,000 be made available for the design of this 
facility.
    Michigan--Selfridge ANGB: Fighter Aircraft Alert Complex.--
Of the amount provided for planning and design in this account, 
the Committee directs that not less than $1,700,000 be made 
available for the design of this facility.
    New York--Francis Gabreski ANGB: Pararescue Facility.--Of 
the amount provided for planning and design in this account, 
the Committee directs that not less than $920,000 be made 
available for the design of this facility.
    New York--Griffiss Northeast Air Defense: Northeast Air 
Defense Sector Support Facility.--Of the amount provided for 
planning and design in this account, the Committee directs that 
not less than $850,000 be made available for the design of this 
facility.
    Oklahoma--Will Rogers World Airport: Replace Composite 
Aircraft Maintenance Complex.--Of the amount provided for 
planning and design in this account, the Committee directs that 
not less than $1,172,000 be made available for the design of 
this facility.
    Pennsylvania--Willow Grove ARS: Operations and 
Communications Training Complex.--Of the amount provided for 
planning and design in this account, the Committee directs that 
not less than $570,000 be made available for the design of this 
facility.

                  Military Construction, Army Reserve





Fiscal year 2005 appropriation........................      $101,077,000
Fiscal year 2006 budget request.......................       106,077,000
Committee recommendation in the bill..................       138,425,000
Comparison with:
    Fiscal year 2005 appropriation....................        37,348,000
    Fiscal year 2006 budget request...................        32,348,000


    The Committee recommends an appropriation of $138,425,000 
for Military Construction, Army Reserve, for fiscal year 2006. 
This is an increase of $37,348,000 above the fiscal year 2005 
enacted level and an increase of $32,348,000 above the budget 
request.
    Massachusetts--Worcester: Reserve Center.--Of the amount 
provided for planning and design in this account, the Committee 
directs that not less than $990,000 be made available for the 
design of this facility.

                  Military Construction, Naval Reserve





Fiscal year 2005 appropriation........................       $48,596,000
Fiscal year 2006 budget request.......................        45,226,000
Committee recommendation in the bill..................        45,226,000
Comparison with:
    Fiscal year 2005 appropriation....................       (3,370,000)
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $45,226,000 
for Military Construction, Naval Reserve, for fiscal year 2006. 
This is a decrease of $3,370,000 below the fiscal year 2005 
enacted level and the same as the budget request.

                Military Construction, Air Force Reserve





Fiscal year 2005 appropriation........................      $123,977,000
Fiscal year 2006 budget request.......................        79,260,000
Committee recommendation in the bill..................       110,847,000
Comparison with:
    Fiscal year 2005 appropriation....................      (13,130,000)
    Fiscal year 2006 budget request...................        31,587,000


    The Committee recommends an appropriation of $110,847,000 
for Military Construction, Air Force Reserve, for fiscal year 
2006. This is a decrease of $13,130,000 below the fiscal year 
2005 enacted level and an increase of $31,587,000 above the 
budget request.

     North Atlantic Treaty Organization Security Investment Program





Fiscal year 2005 appropriation........................      $160,800,000
Fiscal year 2006 budget request.......................       206,858,000
Committee recommendation in the bill..................       206,858,000
Comparison with:
    Fiscal year 2005 appropriation....................        46,058,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $206,858,000 
for the North Atlantic Treaty Organization Security Investment 
Program (NSIP). This is an increase of $46,058,000 above the 
fiscal year 2005 enacted level and the same level as the budget 
request.
    NSIP consists of annual contributions by NATO member 
countries. The program finances the costs of construction 
needed to support the roles of the major NATO commands. The 
investments cover facilities such as airfields, fuel pipelines 
and storage, harbors, communications and information systems, 
radar and navigational aids, and military headquarters.
    Occasionally, the U.S. has been forced to delay temporarily 
the authorization of projects due to shortfalls in U.S. 
obligation authority. The Committee directs the Secretary of 
Defense to notify the Committee 30 days prior to taking such 
action.

                        Family Housing Overview





Fiscal year 2005 appropriation........................    $4,074,603,000
Fiscal year 2006 budget request.......................     4,242,169,000
Committee recommendation in the bill..................     4,201,661,000
Comparison with:
    Fiscal year 2005 appropriation....................       127,058,000
    Fiscal year 2006 budget request...................      (40,508,000)


    The Committee recommends a total appropriation of 
$4,201,661,000 for the family housing construction and 
operation and maintenance accounts for fiscal year 2006. This 
is an increase of $127,058,000 above the fiscal year 2005 
enacted level and a decrease of $40,508,000 below the budget 
request. The operation and maintenance accounts provide funds 
to pay for maintenance and repair, furnishings, management, 
services, utilities, leasing, interest, mortgage insurance, and 
miscellaneous expenses.
    Family Housing Privatization Progress Reports.--The 
Committee continues to support the efforts of the Military 
Housing Privatization Initiative (MHPI) to move service members 
and their families out of inadequate and substandard housing. 
The Department has set the goal of formalizing all the 
necessary agreements with the private sector to eliminate such 
housing within the United States by 2007, and overseas by 2009. 
The Committee is pleased with the rapid progress of the 
program; the Department anticipates that the number of 
inadequate housing units on inventory will be reduced to 36,572 
by the end of fiscal year 2006--a projected reduction of nearly 
80 percent from the January 2001 inventory of approximately 
180,000. The Committee emphasizes that this reduction does not 
mean that those inadequate homes will be replaced with new 
homes by that time; it merely means that the necessary 
contracts will be in place to replace or renovate such homes. 
The MHPI is thus in the process of transition, as the 
Department begins to shift its focus from the conception and 
initiation of privatization agreements with developers to the 
implementation and monitoring of those projects already in 
place. In order to ensure that military families receive new, 
better housing on schedule and that developers keep their 
contractual obligations to the Federal government, it is 
important for the Committee to maintain oversight of the 
program. The Committee is aware that the Department uses a tool 
known as the Program Evaluation Plan (PEP) to monitor the MHPI, 
and that data for the PEP is collected semi-annually. The 
Committee therefore directs the Department to provide a report, 
on a no less than semi-annual basis, summarizing the results of 
the PEP and giving status reports on each privatization project 
underway.
    Family Housing Management Costs.--The Committee remains 
concerned about requested increases in family housing 
management accounts, especially in the Navy and Air Force, both 
of which are requesting substantial increases in per unit 
costs. While the Committee understands that these costs are 
essentially overhead, and do not decline in proportion to the 
reduction in inventory as housing is privatized, the Committee 
nevertheless believes that increases in per unit costs can and 
should be controlled. The table below shows the increases in 
per unit management costs for housing in the continental United 
States requested by the services:

----------------------------------------------------------------------------------------------------------------
                                                                                           CONUS
                                                   Per unit                                family
                                      Per unit    costs,  FY   Requested    Projected     housing     Reduction
              Service                costs,  FY      2006       per unit    decline in   management   from FY06
                                        2005       request     increase,     housing      request,     request
                                       ($000)       ($000)      FY05-06     inventory     FY 2006       ($000)
                                                                                           ($000)
----------------------------------------------------------------------------------------------------------------
Army..............................        1,308        1,442        10.3%      (43.9%)       30,304  ...........
Navy..............................        2,198        4,046        84.1%      (43.7%)       51,049      (5.000)
USMC..............................          903        1,499        66.1%      (56.8%)       10,443  ...........
USAF..............................        1,069        2,693       151.8%      (16.3%)       53,298     (11,620)
----------------------------------------------------------------------------------------------------------------

    The Committee believes that the Navy and Air Force should 
be able to manage family housing with more restrained per unit 
increases. The Committee therefore has reduced the Navy and Air 
Force family housing operation and maintenance requests by 
$5,000,000 and $11,620,000, respectively.
    Foreign Currency Savings.--The Committee directs that 
savings from foreign currency re-estimates be used to maintain 
existing family housing units. The Comptroller is directed to 
report to the Committee on how these savings are allocated by 
December 1, 2005. Likewise, only 10 percent of funds made 
available to the construction and operation and maintenance 
sub-accounts may be transferred between the sub-accounts. Such 
transfers must be reported to the Committee within 30 days of 
such action.
    Leasing Reporting Requirement.--As in prior years, the 
Secretary of Defense is directed to report quarterly on the 
details of all new or renewal domestic leases entered into 
during the previous quarter that exceed $15,000 per unit per 
year, including certification that less expensive housing was 
not available for lease. For foreign leases, the Department is 
directed to: (1) perform an economic analysis on all new leases 
or lease/contract agreements where more than 25 units are 
involved; (2) report the details of new or renewal lease 
agreements that exceed $20,000 per year (as adjusted for 
foreign currency fluctuation from October 1, 1987, but not 
adjusted for inflation) 21 days prior to entering into such an 
agreement; and (3) base leasing decisions on the economic 
analysis.
    Reprogramming Criteria.--The reprogramming criteria that 
apply to military construction projects (25 percent of the 
funded amount or $2,000,000, whichever is less) apply to new 
housing construction projects and improvement projects over 
$2,000,000 as well.

                   Family Housing Construction, Army





Fiscal year 2005 appropriation........................      $615,099,000
Fiscal year 2006 budget request.......................       549,636,000
Committee recommendation in the bill..................       549,636,000
Comparison with:
    Fiscal year 2005 appropriation....................      (65,463,000)
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $549,636,000 
for Family Housing Construction, Army, for fiscal year 2006. 
This is a decrease of $65,463,000 below the fiscal year 2005 
enacted level and the same as the budget request. The 
appropriation includes $231,700,000 to construct new family 
housing units, $300,400,000 to improve existing units, and 
$17,536,000 for planning and design. This funding level will 
provide the budget request of $138,000,000 for the 
privatization of family housing at 5 installations, and 
supports the elimination of 14,478 inadequate family housing 
units.

             Family Housing Operation and Maintenance, Army





Fiscal year 2005 appropriation........................      $927,707,000
Fiscal year 2006 budget request.......................       812,993,000
Committee recommendation in the bill..................       803,993,000
Comparison with:
    Fiscal year 2005 appropriation....................     (123,714,000)
    Fiscal year 2006 budget request...................       (9,000,000)


    The Committee recommends an appropriation of $803,993,000 
for Family Housing Operation and Maintenance, Army, for fiscal 
year 2006. This is a decrease of $123,714,000 below the fiscal 
year 2005 enacted level and a decrease of $9,000,000 below the 
budget request. The decrease is to be taken from the 
Maintenance and Real Property account for general and flag 
officer quarters in the National Capital Region.

           Family Housing Construction, Navy and Marine Corps





Fiscal year 2005 appropriation........................      $126,806,000
Fiscal year 2006 budget request.......................       218,942,000
Committee recommendation in the bill..................       218,942,000
Comparison with:
    Fiscal year 2005 appropriation....................        92,136,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $218,942,000 
for Family Housing Construction, Navy and Marine Corps, for 
fiscal year 2006. This is an increase of $92,136,000 above the 
fiscal year 2005 enacted level and the same as the budget 
request. The appropriation includes $40,298,000 to construct 
new family housing units and $178,644,000 to improve existing 
units. This funding level will provide the budget request of 
$112,327,000 for three family housing privatization projects, 
and supports the elimination of 7,103 inadequate family housing 
units.

    Family Housing Operation and Maintenance, Navy and Marine Corps





Fiscal year 2005 appropriation........................      $705,404,000
Fiscal year 2006 budget request.......................       593,660,000
Committee recommendation in the bill..................       588,660,000
Comparison with:
    Fiscal year 2005 appropriation....................     (116,744,000)
    Fiscal year 2006 budget request...................       (5,000,000)


    The Committee recommends an appropriation of $588,660,000 
for Family Housing Operation and Maintenance, Navy and Marine 
Corps, for fiscal year 2006. This is a decrease of $116,744,000 
below the fiscal year 2005 enacted level and a decrease of 
$5,000,000 below the budget request. The decrease is to be 
taken from the management account as explained in the family 
housing overview.

                 Family Housing Construction, Air Force





Fiscal year 2005 appropriation........................      $801,788,000
Fiscal year 2006 budget request.......................     1,251,108,000
Committee recommendation in the bill..................     1,236,220,000
Comparison with:
    Fiscal year 2005 appropriation....................       434,432,000
    Fiscal year 2006 budget request...................      (14,888,000)


    The Committee recommends an appropriation of $1,236,220,000 
for Family Housing Construction, Air Force, for fiscal year 
2006. This is an increase of $434,432,000 above the fiscal year 
2005 enacted level and a decrease of $14,888,000 below the 
budget request. The appropriation includes $570,340,000 to 
construct new family housing units, $790,013,000 to improve 
existing units, and $37,104,000 for planning and design. The 
funding level will provide the budget request of $65,142,000 
for three family housing privatization projects, and supports 
the elimination of 9,033 inadequate family housing units.
    The reductions to the request are as follows: $488,000 from 
new construction and $11,100,000 from construction improvements 
for general officers quarters in the National Capital Region; 
and $3,300,000 from planning and design for an Air Force 
programming error.

          Family Housing Operation and Maintenance, Air Force





Fiscal year 2005 appropriation........................      $864,784,000
Fiscal year 2006 budget request.......................       766,939,000
Committee recommendation in the bill..................       755,319,000
Comparison with:
    Fiscal year 2005 appropriation....................     (109,465,000)
    Fiscal year 2006 budget request...................      (11,620,000)


    The Committee recommends an appropriation of $755,319,000 
for Family Housing Operation and Maintenance, Air Force, for 
fiscal year 2006. This is a decrease of $109,465,000 below the 
fiscal year 2005 enacted level and a decrease of $11,620,000 
below the budget request.
    The decrease below the request is from the Management 
account as explained in the family housing overview.

               Family Housing Construction, Defense-wide





Fiscal year 2005 appropriation........................           $49,000
Fiscal year 2006 budget request.......................  ................
Committee recommendation in the bill..................  ................
Comparison with:
    Fiscal year 2005 appropriation....................          (49,000)
    Fiscal year 2006 budget request...................  ................


    The Committee does not recommend an appropriation for 
Family Housing Construction, Defense-wide, for fiscal year 
2006. This is a decrease of $49,000 below the fiscal year 2005 
enacted level and the same as the budget request.

         Family Housing Operation and Maintenance, Defense-wide





Fiscal year 2005 appropriation........................       $49,575,000
Fiscal year 2006 budget request.......................        46,391,000
Committee recommendation in the bill..................        46,391,000
Comparison with:
    Fiscal year 2005 appropriation....................       (3,184,000)
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $46,391,000 
for Family Housing Operation and Maintenance, Defense-wide, for 
fiscal year 2006. This is a decrease of $3,184,000 below the 
fiscal year 2005 enacted level and the same as the budget 
request.

         Department of Defense Family Housing Improvement Fund





Fiscal year 2005 appropriation........................    $ (16,609,000)
Fiscal year 2006 budget request.......................         2,500,000
Committee recommendation in the bill..................         2,500,000
Comparison with:
    Fiscal year 2005 appropriation....................        19,109,000
    Fiscal year 2006 estimate.........................  ................


    The Committee recommends an appropriation of $2,500,000 for 
the Department of Defense Family Housing Improvement Fund 
(FHIF) for fiscal year 2006. This is an increase of $19,109,000 
above the fiscal year 2005 enacted level and the same as the 
budget request. The Military Construction Appropriations Act, 
2005 (PL 108-324) appropriated $2,500,000 to the Fund while 
rescinding $19,109,000 for projects that were no longer 
required.
    The FHIF is authorized by section 2883, title 10, United 
States Code, and provides the Department of Defense with 
authority to finance joint ventures with the private sector to 
revitalize and to manage the Department's housing inventory. 
The statute authorizes the Department to use limited 
partnerships, make direct and guaranteed loans, and convey 
Department-owned property to stimulate the private sector to 
increase the availability of affordable, quality housing for 
military personnel.
    The FHIF is used to build or renovate family housing by 
mixing or matching various legal authorities, and by utilizing 
private capital and expertise to the maximum extent possible. 
The Fund is administered as a single account without fiscal 
year limitations and contains appropriated and transferred 
funds from family housing construction accounts.

          Chemical Demilitarization Construction, Defense-wide





Fiscal year 2005 appropriation........................       $81,886,000
Fiscal year 2006 budget request.......................  ................
Committee recommendation in the bill..................  ................
Comparison with:
    Fiscal year 2005 appropriation....................      (81,886,000)
    Fiscal year 2006 budget request...................  ................


    The Committee does not recommend an appropriation for 
Chemical Demilitarization Construction, Defense-wide, for 
fiscal year 2006. This is a decrease of $81,886,000 below the 
fiscal year 2005 enacted level and the same as the budget 
request.
    The Chemical Demilitarization Construction, Defense-wide 
account provides funds for the design and construction of full-
scale chemical disposal facilities and associated projects to 
upgrade installation support facilities and infrastructures 
required to support the Chemical Demilitarization program.

               Base Realignment and Closure Account 1990





Fiscal year 2005 appropriation........................      $246,166,000
Fiscal year 2006 budget request.......................       377,827,000
Committee recommendation in the bill..................       377,827,000
Comparison with:
    Fiscal year 2005 appropriation....................       131,661,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $377,827,000 
for the Base Realignment and Closure Account 1990 for fiscal 
year 2006. This is an increase of $131,661,000 above the fiscal 
year 2005 enacted level and the same as the budget request.

               Base Realignment and Closure Account 2005





Fiscal year 2005 appropriation........................  ................
Fiscal year 2006 budget request.......................    $1,880,466,000
Committee recommendation in the bill..................     1,570,466,000
Comparison with:
    Fiscal year 2005 appropriation....................     1,570,466,000
    Fiscal year 2006 budget request...................     (310,000,000)


    The Committee recommends an appropriation of $1,570,466,000 
for the Base Realignment and Closure Account 2005 for fiscal 
year 2006. This is a decrease of $310,000,000 below the budget 
request. No funds were appropriated for this account in fiscal 
year 2005, as this is a new account.

                   Basic Allowance for Housing, Army





Fiscal year 2005 appropriation........................    $3,341,882,000
Fiscal year 2006 budget request.......................     3,945,392,000
Committee recommendation in the bill..................     3,945,392,000
Comparison with:
    Fiscal year 2005 appropriation....................       603,510,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $3,945,392,000 
for Basic Allowance for Housing, Army for fiscal year 2006. 
This is an increase of $603,510,000 above the fiscal year 2005 
enacted level and the same as the budget request.

                   Basic Allowance for Housing, Navy





Fiscal year 2005 appropriation........................    $3,471,251,000
Fiscal year 2006 budget request.......................     3,592,905,000
Committee recommendation in the bill..................     3,592,905,000
Comparison with:
    Fiscal year 2005 appropriation....................       121,654,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $3,592,905,000 
for Basic Allowance for Housing, Navy for fiscal year 2006. 
This is an increase of $121,654,000 above the fiscal year 2005 
enacted level and the same as the budget request.

               Basic Allowance for Housing, Marine Corps





Fiscal year 2005 appropriation........................    $1,053,573,000
Fiscal year 2006 budget request.......................     1,179,071,000
Committee recommendation in the bill..................     1,179,071,000
Comparison with:
    Fiscal year 2005 appropriation....................       125,498,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $1,179,071,000 
for Basic Allowance for Housing, Marine Corps for fiscal year 
2006. This is an increase of $125,498,000 above the fiscal year 
2005 enacted level and the same as the budget request.

                 Basic Allowance for Housing, Air Force





Fiscal year 2005 appropriation........................    $3,010,770,000
Fiscal year 2006 budget request.......................     3,240,113,000
Committee recommendation in the bill..................     3,240,113,000
Comparison with:
    Fiscal year 2005 appropriation....................       229,343,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $3,240,113,000 
for Basic Allowance for Housing, Air Force for fiscal year 
2006. This is an increase of $229,343,000 above the fiscal year 
2005 enacted level and the same as the budget request.

            Basic Allowance for Housing, Army National Guard





Fiscal year 2005 appropriation........................      $434,073,000
Fiscal year 2006 budget request.......................       453,690,000
Committee recommendation in the bill..................       453,690,000
Comparison with:
    Fiscal year 2005 appropriation....................        19,617,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $453,690,000 
for Basic Allowance for Housing, Army National Guard for fiscal 
year 2006. This is an increase of $19,617,000 above the fiscal 
year 2005 enacted level and the same as the budget request.

            Basic Allowance for Housing, Air National Guard





Fiscal year 2005 appropriation........................      $214,151,000
Fiscal year 2006 budget request.......................       248,317,000
Committee recommendation in the bill..................       248,317,000
Comparison with:
    Fiscal year 2005 appropriation....................        34,166,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $248,317,000 
for Basic Allowance for Housing, Air National Guard for fiscal 
year 2006. This is an increase of $34,166,000 above the fiscal 
year 2005 enacted level and the same as the budget request.

               Basic Allowance for Housing, Army Reserve





Fiscal year 2005 appropriation........................      $290,117,000
Fiscal year 2006 budget request.......................       310,566,000
Committee recommendation in the bill..................       310,566,000
Comparison with:
    Fiscal year 2005 appropriation....................        20,449,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $310,566,000 
for Basic Allowance for Housing, Army Reserve for fiscal year 
2006. This is an increase of $20,449,000 above the fiscal year 
2005 enacted level and the same as the budget request.

               Basic Allowance for Housing, Naval Reserve





Fiscal year 2005 appropriation........................      $202,282,000
Fiscal year 2006 budget request.......................       191,338,000
Committee recommendation in the bill..................       191,338,000
Comparison with:
    Fiscal year 2005 appropriation....................      (10,944,000)
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $191,338,000 
for Basic Allowance for Housing, Naval Reserve for fiscal year 
2006. This is a decrease of $10,944,000 from the fiscal year 
2005 enacted level and the same as the budget request.

           Basic Allowance for Housing, Marine Corps Reserve





Fiscal year 2005 appropriation........................       $38,945,000
Fiscal year 2006 budget request.......................        40,609,000
Committee recommendation in the bill..................        40,609,000
Comparison with:
    Fiscal year 2005 appropriation....................         1,664,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $40,609,000 
for Basic Allowance for Housing, Marine Corps Reserve for 
fiscal year 2006. This is an increase of $1,664,000 above the 
fiscal year 2005 enacted level and the same as the budget 
request.

             Basic Allowance for Housing, Air Force Reserve





Fiscal year 2005 appropriation........................       $59,781,000
Fiscal year 2006 budget request.......................        71,286,000
Committee recommendation in the bill..................        71,286,000
Comparison with:
    Fiscal year 2005 appropriation....................        11,505,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $71,286,000 
for Basic Allowance for Housing, Air Force Reserve for fiscal 
year 2006. This is an increase of $11,505,000 above the fiscal 
year 2005 enacted level and the same as the budget request.

      Facilities Sustainment, Restoration and Modernization, Army





Fiscal year 2005 appropriation........................    $1,967,028,000
Fiscal year 2006 budget request.......................     1,825,518,000
Committee recommendation in the bill..................     1,850,518,000
Comparison with:
    Fiscal year 2005 appropriation....................     (116,510,000)
    Fiscal year 2006 budget request...................        25,000,000


    The Committee recommends an appropriation of $1,850,518,000 
for facilities sustainment, restoration and modernization, Army 
for fiscal year 2006. This is a decrease of $116,510,000 below 
the fiscal year 2005 enacted level and an increase of 
$25,000,000 above the budget request.
    Army 90-90 Funding Initiative.--The Army announced in March 
2004 that it will institute a policy of funding both base 
operations support (BOS) and facilities sustainment at no less 
than 90 percent. The Committee approves of this initiative but 
laments that it was not instituted prior to the release of the 
fiscal year 2006 budget request. The underfunding of both BOS 
and sustainment accounts has been a chronic problem. In the 
past, funds were routinely transferred from the underfunded 
sustainment accounts to the even more severely underfunded BOS 
accounts to meet ``must-pay'' obligations such as utilities. 
The fiscal year 2006 budget request would not depart from this 
practice; BOS is budgeted at 72 percent of the requirement, 
while sustainment is budgeted at 91 percent. This practice has 
been of no small consequence, as the Army rates its overall 
facilities at C-3--meaning its facilities have significant 
deficiencies that prevent performance of some missions. This 
draining of funds from sustainment to pay for BOS or other 
urgent operational needs increased the rate at which facilities 
deteriorate and needed to be recapitalized. The end result was 
increased costs for military construction. Over time, such a 
situation has produced a less efficient use of taxpayer dollars 
and has led to a situation where our service men and women live 
and work in deteriorated and at times unsafe facilities. The 
Committee notes that, as sustainment is provided as a separate 
appropriation within this bill, neither the Army nor any other 
service component has the option of transferring funds out of 
sustainment to pay for BOS or other operational costs. This 
change presents an opportunity to fund facilities sustainment 
more sufficiently and with greater transparence. The Committee 
approves of the Army's 90-90 initiative, and urges the Army to 
go beyond this goal (as well as the Department of Defense goal 
of 95 percent funding for sustainment, repair and 
modernization) to fund sustainment at 100 percent.

      Facilities Sustainment, Restoration and Modernization, Navy





Fiscal year 2005 appropriation........................    $1,333,288,000
Fiscal year 2006 budget request.......................     1,344,971,000
Committee recommendation in the bill..................     1,344,971,000
Comparison with:
    Fiscal year 2005 appropriation....................        11,683,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $1,344,971,000 
for Facilities Sustainment, Restoration and Modernization, Navy 
for fiscal year 2006. This is an increase of $11,683,000 above 
the fiscal year 2005 enacted level and the same as the budget 
request.

  Facilities Sustainment, Restoration and Modernization, Marine Corps





Fiscal year 2005 appropriation........................      $523,756,000
Fiscal year 2006 budget request.......................       553,960,000
Committee recommendation in the bill..................       553,960,000
Comparison with:
    Fiscal year 2005 appropriation....................        30,204,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $553,960,000 
for Facilities Sustainment, Restoration and Modernization, 
Marine Corps for fiscal year 2006. This is an increase of 
$30,204,000 above the fiscal year 2005 enacted level and the 
same as the budget request.

    Facilities Sustainment, Restoration and Modernization, Air Force





Fiscal year 2005 appropriation........................    $1,991,710,000
Fiscal year 2006 budget request.......................     1,815,701,000
Committee recommendation in the bill..................     1,845,701,000
Comparison with:
    Fiscal year 2005 appropriation....................     (146,009,000)
    Fiscal year 2006 budget request...................        30,000,000


    The Committee recommends an appropriation of $1,845,701,000 
for Facilities Sustainment, Restoration and Modernization, Air 
Force for fiscal year 2006. This is a decrease of $146,009,000 
below the fiscal year 2005 enacted level and an increase of 
$30,000,000 above the budget request. Within the amount 
provided, $1,500,000 is for airfield lighting improvements at 
Avon Park.

  Facilities Sustainment, Restoration and Modernization, Defense-wide





Fiscal year 2005 appropriation........................       $95,000,000
Fiscal year 2006 budget request.......................       115,400,000
Committee recommendation in the bill..................       115,400,000
Comparison with:
    Fiscal year 2005 appropriation....................        20,400,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $115,400,000 
for Facilities Sustainment, Restoration and Modernization, 
Defense-Wide for fiscal year 2006. This is an increase of 
$20,400,000 above the fiscal year 2005 enacted level and the 
same as the budget request.

 Facilities Sustainment, Restoration and Modernization, Army National 
                                 Guard





Fiscal year 2005 appropriation........................      $384,044,000
Fiscal year 2006 budget request.......................       391,544,000
Committee recommendation in the bill..................       391,544,000
Comparison with:
    Fiscal year 2005 appropriation....................         7,500,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $391,544,000 
for Facilities Sustainment, Restoration and Modernization, Army 
National Guard for fiscal year 2006. This is an increase of 
$7,500,000 above the fiscal year 2005 enacted level and the 
same as the budget request.

  Facilities Sustainment, Restoration and Modernization, Air National 
                                 Guard





Fiscal year 2005 appropriation........................      $230,642,000
Fiscal year 2006 budget request.......................       169,791,000
Committee recommendation in the bill..................       184,791,000
Comparison with:
    Fiscal year 2005 appropriation....................      (45,851,000)
    Fiscal year 2006 budget request...................        15,000,000


    The Committee recommends an appropriation of $184,791,000 
for Facilities Sustainment, Restoration and Modernization, Air 
National Guard for fiscal year 2006. This is a decrease of 
$45,851,000 below the fiscal year 2005 enacted level and an 
increase of $15,000,000 above the budget request.

  Facilities Sustainment, Restoration and Modernization, Army Reserve





Fiscal year 2005 appropriation........................      $201,141,000
Fiscal year 2006 budget request.......................       204,370,000
Committee recommendation in the bill..................       204,370,000
Comparison with:
    Fiscal year 2005 appropriation....................         3,229,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $204,370,000 
for Facilities Sustainment, Restoration and Modernization, Army 
Reserve for fiscal year 2006. This is an increase of $3,229,000 
above the fiscal year 2005 enacted level and the same as the 
budget request.

  Facilities Sustainment, Restoration and Modernization, Naval Reserve





Fiscal year 2005 appropriation........................       $73,410,000
Fiscal year 2006 budget request.......................        62,788,000
Committee recommendation in the bill..................        67,788,000
Comparison with:
    Fiscal year 2005 appropriation....................       (5,622,000)
    Fiscal year 2006 budget request...................         5,000,000



    The Committee recommends an appropriation of $67,788,000 
for Facilities Sustainment, Restoration and Modernization, 
Naval Reserve for fiscal year 2006. This is a decrease of 
$5,622,000 from the fiscal year 2005 enacted level and an 
increase of $5,000,000 above the budget request.

  Facilities Sustainment, Restoration and Modernization, Marine Corps 
                                Reserve





Fiscal year 2005 appropriation........................       $12,126,000
Fiscal year 2006 budget request.......................        10,105,000
Committee recommendation in the bill..................        10,105,000
Comparison with:
    Fiscal year 2005 appropriation....................       (2,021,000)
    Fiscal year 2006 budget request...................  ................



    The Committee recommends an appropriation of $10,105,000 
for Facilities Sustainment, Restoration and Modernization, 
Marine Corps Reserve for fiscal year 2006. This is a decrease 
of $2,021,000 from the fiscal year 2005 enacted level and the 
same as the budget request.

   Facilities Sustainment, Restoration and Modernization, Air Force 
                                Reserve





Fiscal year 2005 appropriation........................       $53,056,000
Fiscal year 2006 budget request.......................        55,764,000
Committee recommendation in the bill..................        55,764,000
Comparison with:
    Fiscal year 2005 appropriation....................         2,708,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $55,764,000 
for Facilities Sustainment, Restoration and Modernization, Air 
Force Reserve for fiscal year 2006. This is an increase of 
$2,708,000 above the fiscal year 2005 enacted level and the 
same as the budget request.

                    Environmental Restoration, Army





Fiscal year 2005 appropriation........................      $400,948,000
Fiscal year 2006 budget request.......................       407,865,000
Committee recommendation in the bill..................       407,865,000
Comparison with:
    Fiscal year 2005 appropriation....................         6,917,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $407,865,000 
for Environmental Restoration, Army for fiscal year 2006. This 
is an increase of $6,917,000 above the fiscal year 2005 enacted 
level and the same as the budget request.

                    Environmental Restoration, Navy





Fiscal year 2005 appropriation........................      $266,820,000
Fiscal year 2006 budget request.......................       305,275,000
Committee recommendation in the bill..................       305,275,000
Comparison with:
    Fiscal year 2005 appropriation....................        38,455,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $305,275,000 
for Environmental Restoration, Navy for fiscal year 2006. This 
is an increase of $38,455,000 above the fiscal year 2005 
enacted level and the same as the budget request.

                  Environmental Restoration, Air Force





Fiscal year 2005 appropriation........................      $397,368,000
Fiscal year 2006 budget request.......................       406,461,000
Committee recommendation in the bill..................       406,461,000
Comparison with:
    Fiscal year 2005 appropriation....................         9,093,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $406,461,000 
for Environmental Restoration, Air Force for fiscal year 2006. 
This is an increase of $9,093,000 above the fiscal year 2005 
enacted level and the same as the budget request.

                Environmental Restoration, Defense-wide





Fiscal year 2005 appropriation........................       $23,684,000
Fiscal year 2006 budget request.......................        28,167,000
Committee recommendation in the bill..................        28,167,000
Comparison with:
    Fiscal year 2005 appropriation....................         4,483,000
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $28,167,000 
for Environmental Restoration, Defense-wide for fiscal year 
2006. This is an increase of $4,483,000 above the fiscal year 
2005 enacted level and the same as the budget request.

         Environmental Restoration, Formerly Used Defense Sites




Fiscal year 2005 appropriation........................      $266,516,000
Fiscal year 2006 budget request.......................       221,921,000
Committee recommendation in the bill..................       221,921,000
Comparison with:
    Fiscal year 2005 appropriation....................      (44,595,000)
    Fiscal year 2006 budget request...................  ................


    The Committee recommends an appropriation of $221,921,000 
for Environmental Restoration, Formerly Used Defense Sites for 
fiscal year 2006. This is a decrease of $44,595,000 below the 
fiscal year 2005 enacted level and the same as the budget 
request.

                         Defense Health Program





Fiscal year 2005 appropriation.......................    $18,171,436,000
Fiscal year 2006 budget request......................     19,791,612,000
Committee recommendation in the bill.................     19,983,912,000
Comparison with:
    Fiscal year 2005 appropriation...................      1,812,476,000
    Fiscal year 2006 budget request..................        192,300,000


    The Committee recommends a total appropriation of 
$19,983,912,000 for the Defense Health Program for fiscal year 
2006. This is an increase of $1,812,476,000 above the fiscal 
year 2005 enacted level, not including supplemental funding, 
and an increase of $192,300,000 above the budget request.
    There has been a lot of work done to improve the Defense 
Health Program (DHP) and in recent years the Department has 
made great strides toward improving the quality of DHP 
estimates; however, the Committee continues to be concerned 
about the growing stress on the program. In light of the 
growing cost of health care in general, the Military Health 
System (MHS) must provide for medical readiness and force 
health protection as its primary goal.
    The DHP appropriation provides for worldwide medical and 
dental services to active forces and other eligible 
beneficiaries, veterinary services, medical command 
headquarters, specialized services for the training of medical 
personnel, and occupational and industrial health care. The 
budget request for normal peacetime funding sustains the MHS to 
ensure the nation has available at all times a healthy force 
supported by a combat ready health care system and to provide a 
cost effective, quality healthcare. The program provides 
medical care for 9.1 million beneficiaries through a worldwide 
network of over 500 military hospitals and health clinics, and 
the Department of Defense's extensive private sector health 
care partners.
    The budget request supports increasing benefits provided to 
the Active Duty and Reserve Components and their dependents, as 
well as retirees. The Committee is aware that DHP faces many 
financial challenges. This year is no different. More and more 
demands are being placed on the system through the increased 
number of beneficiaries using TRICARE, increased beneficiary 
demand, health care inflation, and military transformation. The 
largest growth in the fiscal year 2006 budget request is in the 
operation and maintenance budget activity group for the program 
with an overall increase of $1.9 billion. This growth is in the 
principle element of the Department's health care costs in the 
Private Sector Care budget activity group which pays health 
care costs to the civilian providers.
    The Committee, however, has concerns with the amount of 
over- and under-executed dollars in the seven operation and 
maintenance budget activity groups and the unobligated dollars 
that are annually turned back to the Treasury. The Committee 
believes that the MHS should be fully funded, with each budget 
activity group properly executing the amounts budgeted. The 
Committee expects the Department to be fiscally responsible in 
its budgeting of the Defense Health Program and make annual 
adjustments to budget activity groups based on prior year 
execution.
    The Committee is pleased that the TRICARE contract 
transformation efforts and the cooperation by the various 
Military Treatment Facilities and private sector health care 
entities has not disrupted beneficiary health care. The Next 
Generation TRICARE contracts (TNEX) include incentives for 
efficient health care delivery that maximizes the In-House (or 
Direct) Care System utilization. The ongoing implementation of 
the Prospective Payment System that uses performance based 
budgeting focusing on the value of outputs rather than that of 
the cost of inputs for the health care services provided links 
the budgets and productivity together. The Committee is also 
encouraged by the Department's ongoing business practice 
improvements by empowering the Military Treatment Facility 
(MTF) Commanders with the authority and responsibility for the 
PRIME enrollee care provided both at the MTF and in the private 
sector.
    The Committee continues to expect the Department to provide 
ongoing outreach programs regarding the full array of TRICARE 
programs to all categories of beneficiaries, beneficiary 
representative groups and health care providers.
    The Composite Health Care System, the military electronic 
medical record, is robustly funded in the fiscal year 2006 
budget request. The Committee is hopeful that this funding 
increase will enhance the continuation of streamlining 
financial operations, improve business practices and most 
importantly, improve customer service. The electronic medical 
record ensures continuity of health information and patient-
centered health care delivery.
    Reprogramming Procedures.--The Committee remains concerned 
with the transfer of funds from Direct (or In-house) Care to 
pay for contractor-provided medical care. To continue oversight 
within the operation and maintenance account, the Committee 
includes language in the bill similar to last year to limit the 
funds available for Private Sector Care under the TRICARE 
program and make transfers above this limit subject to prior 
approval reprogramming procedures. This language should not be 
interpreted by the Department as limiting the amount of funds 
that may be transferred to the direct care system from other 
budget activities within the Defense Health Program. In 
addition, the Committee directs the Department to provide 
budget execution data for all the DHP accounts on a quarterly 
basis through the DD-COMP(M) 1002 accounting form.
    Special Items of Interest.--Programs or activities for 
which additional funds have been provided above the budget 
request are to be considered as congressional interest items 
for the purpose of the Base for Reprogramming Form (DD 1414). 
Therefore, each of these items must be submitted to the 
Committee on the DD 1414 at the stated amount. These items 
remain special interest items whether or not they are repeated 
in a subsequent conference report.
    Health Care Benefits for Reservists and Their Families.--
Since September 2001, more than 340,000 National Guard and 
Reserve personnel have been called to active duty and have 
served for a year or more. It is clear their use in military 
operations is expected to remain high for the foreseeable 
future. Congress has made many improvements and enhancements to 
compensation and benefits programs for the reservists. 
Additional changes are being proposed, including a proposal to 
expand TRICARE to all reservists and their families when the 
member is not on active duty. The Department estimates the cost 
to implement the current proposal would be $7.7 billion over 
the next five years. Therefore, the Committee directs the 
Department to report back no later than March 1, 2006 on the 
need and ramifications of additional health care for reservists 
and their families. The report should include, but not be 
limited to the total estimated costs--delineated among the 
Budget Activity Groups in the Defense Health Program; long-term 
costs and implications of the proposal; a demographic trend and 
rising health care costs comparison on how current benefits 
compare to national healthcare
    TRICARE Reimbursement Rates for Physicians.--The 
establishment of the Military Quality of Life and Veterans 
Affairs subcommittee provides the Committee with opportunities 
to look at areas of concern that it may not otherwise have had 
the opportunity to review. The Committee directs the Assistant 
Secretary of Defense for Health Affairs to report on the 
process for establishing reimbursement rates and the adequacy 
of current reimbursement rates for physicians in all three 
TRICARE Regions by March 1, 2006.
    Prevention and Treatment of Noise-Induced Hearing Loss.--
Noise-induced hearing loss is one of the most common injuries 
associated with military service that has an affect on medical 
readiness and combat effectiveness. The Committee understands 
that as a result of ongoing combat operations, one in three 
post-deploying soldiers report acute acoustic trauma and one in 
four report hearing loss and/or hearing complaints. While the 
Department has instituted hearing conservation initiatives for 
over 30 years, the Committee feels that efforts and 
effectiveness of these measures could be improved. Therefore, 
the Committee recommends the Department enhance its hearing 
conservation programs by ensuring that properly trained 
personnel are available to provide and manage effective and 
robust hearing conservation programs and to develop and test 
protective devices that address combat-associated noise.

                       Operation and Maintenance





Fiscal year 2005 appropriation.......................    $17,297,419,000
Fiscal year 2006 budget request......................     19,247,137,000
Committee recommendation in the bill.................     19,184,537,000
Comparison with:
    Fiscal year 2005 appropriation...................      1,887,118,000
    Fiscal year 2006 budget request..................       (62,600,000)


    The Committee recommends an appropriation of 
$19,184,537,000 for operation and maintenance for fiscal year 
2006. This is an increase of $1,887,118,000 above the fiscal 
year 2005 enacted level, not including supplemental funding, 
and a decrease of $62,600,000 below the budget request. The 
Committee's recommendations are as follows:

                EXPLANATION OF PROJECT LEVEL ADJUSTMENTS
                        [In thousands of dollars]
------------------------------------------------------------------------
                                                             Committee
                                          Budget request    recommended
------------------------------------------------------------------------
Operation and Maintenance...............      19,247,137      19,184,537
------------------------------------------------------------------------
In-House Care...........................       5,210,340       5,141,740
    Interactive Internet @ WRAMC........  ..............           2,000
    Walter Reed Amputee Care Center.....  ..............           5,500
    Unobligated Balances (No-year $:      ..............        (26,100)
 Army $9.8m, Navy $8.7m, TMA $2m & AF
 $5.6m).................................
    Pharmacy Reduction (CONUS)..........  ..............        (50,000)
Private Sector Care.....................      10,212,427      10,212,427
Consolidated Health Care Support........       1,162,589       1,162,589
Information Management..................         841,554         847,554
    Maternal Fetal Informatics and        ..............           1,000
 Outreach Program.......................
    Medical Data Conversion at WRAMC....  ..............           1,000
    Trauma Registry and Research          ..............           4,000
 Database...............................
Management Activities...................         229,382         229,382
Education and Training..................         443,462         443,462
Base Operations/Communications..........       1,147,383       1,147,383
------------------------------------------------------------------------

    Pharmacy Reduction in Direct Care.--The current execution 
rate for pharmaceuticals, In-House Care (CONUS) is 10.1 
percent. The increase in the budget request for 
pharmaceuticals, In-House Care (CONUS) is based on a 13 percent 
execution rate. The justification for this increase is lacking, 
therefore the Committee reduces the amount provided for In-
House Care (CONUS) pharmaceuticals by $50,000,000. The 
Committee notes the National execution rate for pharmaceuticals 
is 7.8 percent. The Committee expects the Department to take 
the necessary steps to reduce its execution rate to be more 
inline with the national rate.
    Unobligated Balances.--The Committee has adjusted the 
amounts available for operation and maintenance in fiscal year 
2006 to account for no-year funding left unobligated at the end 
of prior fiscal years and the effect of such under-obligations 
on estimated future requirements.
    TRlCARE Mail Order Pharmacy.--The Committee believes the 
TRICARE Mail Order Pharmacy (TMOP) is an economical option for 
long-term prescription drug needs. The Committee, however, is 
concerned that beneficiary use of this program remains stagnant 
with only an increase of 20 percent in new users for 2005-2006. 
The Committee directs the Department of Defense to educate the 
TRICARE beneficiary population on the benefits and the value of 
this program and report back on their findings no later than 
March 1, 2006.
    Private Sector Care.--During the fiscal year 2006 budget 
briefs the documentation presented to the Committee was wrought 
with errors making it extremely difficult to follow specifics 
regarding the total program requirement. Therefore, the 
Committee directs the Department to notify the Committee on the 
movement of dollars within the private sector care budget 
activity group on a quarterly basis beginning in the first 
quarter of fiscal year 2006.
    TRlCARE Enterprise-Wide Referral and Authorization 
Process.--The Committee is concerned that the current referral 
management process is extremely complex, and at times can be 
unresponsive and burdensome to the patient, providers, and 
healthcare administrators in both the direct and purchased care 
systems. The result has been growing patient dissatisfaction 
with access to care and increased administrative workload. The 
Committee understands that the Services' Deputy Surgeons 
General identified the need for a streamlined referral 
management process to facilitate clinical and administrative 
communication across the enterprise. As such, the Committee 
directs the Secretary of Defense to report back to the 
Committee with an update on the TRICARE Enterprise-Wide 
Referral and Authorization Process, as recommended by the 
Services' Deputy Surgeons General by March 1, 2006.
    Medical Readiness of Reserve Components.--The Committee is 
concerned about the medical readiness of our Reserve 
Components. At the height of the medical hold over (MHO), the 
majority of soldiers in MHO status were reservists who were not 
medically ready to serve, many due to poor dental hygiene. 
Reserve Components are required to be medically and physically 
fit, yet at the same time there is not an emphasis on dental 
readiness. The Committee directs the Department to do a study 
on incorporating dental examinations into the routine reserve 
medical readiness examinations on an annual basis. The report 
should include, but not be limited to cost estimates, services 
requirements to incorporate dental examinations into medical 
readiness, availability of physicians and dentists to handle 
the increase in workload in the reservists home station and a 
feasible date in which dental exams will be incorporated. The 
report should be submitted no later than March 1, 2006.
    Smoking Cessation.--The Committee commends the Department 
on initiatives that help soldiers and their families make 
healthier decisions especially in the area of tobacco use and 
encourages the Department to continue this work. Currently, 
TRICARE does not cover the cost of smoking cessation products, 
even though smoking cessation programs are available at 
Military Treatment Facilities. The Committee is aware of the 
``Healthy Choices for Life'' demonstration program that will be 
offered to those individuals who are enrolled in TRICARE Prime. 
This program will cover the costs of medications if needed 
during participation in this program. The Committee directs the 
Department to report back on the successes and lessons learned 
from this initiative including an analysis of the costs 
associated with covering the medications needed for all TRICARE 
beneficiaries no later than March 1, 2006.
    Great Lakes--VA/DOD Health Care Resource Sharing.--The 
Committee is pleased that the Department of the Navy and the 
Department of Veterans Affairs recently finalized their 
agreement to construct and operate a joint federal health care 
center in North Chicago, Illinois. This unique arrangement will 
allow our military community and veterans to enjoy the 
expertise and combined services of naval and VA medical 
professionals in a brand new, state-of-the-art facility. The 
Committee directs the Department of the Navy and the Department 
of Veterans Affairs to complete the work on governance of the 
joint institution by March 1, 2006. The Committee also directs 
the Navy to report on the architecture of the new joint 
hospital by October 31, 2005.
    Walter Reed Army Medical Center Amputee Patient Care 
Center.--At the request of the Department, the Committee 
approved a military construction reprogramming request to 
construct the Amputee Patient Care Center at Walter Reed and 
provided initial operating costs through DHP to get the Center 
going with the understanding that the Center's full operating 
costs would be built into the fiscal year 2006 budget. The 
Committee commends the Army and those associated with this 
vital effort; however, the Committee is extremely disappointed 
that no operating funds are included in the budget request. The 
Committee is further frustrated to learn that the Amputee 
Center did not make the POM 07-12 process for the fiscal year 
2007 budget as well.
    The Center provides state-of-the-art treatment and 
rehabilitation of military amputee patients during the surge in 
combat injuries involving amputations of major limbs. When the 
Global War on Terrorism ends, this vital program will continue 
to serve and assist amputees and their families throughout 
their lives and requires proper annual budgeting that goes 
beyond the guidelines for Global War on Terrorism funding 
requirements. The Committee provides $5,500,000 above the 
budget request for operating costs associated with the center, 
including but not limited to personnel, equipment, patient 
travel and prosthetic device costs and directs the Secretary of 
Defense and the Surgeon General of the Army to secure full 
funding for all costs associated with this invaluable center in 
fiscal year 2007 and beyond. The Department should not rely on 
Congress to fund the annual operating cost of this Center.
    Interactive Internet at Walter Reed Army Medical Center.--
The Committee provides $2,000,000 above the budget request to 
the Army to provide interactive internet at Walter Reed Army 
Medical Center to approximately 265 rooms in the in-patient 
wards, including the ICU. This will enable the soldiers to 
communicate with their families and have access to the various 
soldier support services.
    Department of Defense Trauma Registry and Research 
Database.--The Committee provides an additional $4,000,000 for 
the DOD Trauma Registry and Research Database. The project will 
be conducted through the Army Institute of Surgical Research to 
enhance the Army's ability to track wounded soldiers and target 
research initiatives that would enhance medical care for the 
soldier.

                              Procurement




Fiscal year 2005 appropriation.......................       $367,035,000
Fiscal year 2006 budget request......................        375,319,000
Committee recommendation in the bill.................        355,119,000
Comparison with:
    Fiscal year 2005 appropriation...................       (11,916,000)
    Fiscal year 2006 budget request..................       (20,200,000)

    The Committee recommends an appropriation of $355,119,000 
for procurement for fiscal year 2006. This is a decrease of 
$11,916,000 below the fiscal year 2005 enacted level, not 
including supplemental funding, and a decrease of $20,200,000 
below the budget request. The Committee's recommendation is as 
follows:

                EXPLANATION OF PROJECT LEVEL ADJUSTMENTS
                        [In thousands of dollars]
------------------------------------------------------------------------
                                                             Committee
                                          Budget request    recommended
------------------------------------------------------------------------
Procurement.............................         375,319         355,119
------------------------------------------------------------------------
    Protected Health Information          ..............           3,000
 Initiative.............................
    Unobligated Balances (03-05)........  ..............        (23,200)
------------------------------------------------------------------------

    Unobligated Balances.--The Committee has adjusted the 
amounts available for procurement in fiscal year 2006 to 
account for funding left unobligated at the end of prior fiscal 
years and the effect of such under-obligations on estimated 
future requirements.

                        Research and Development


Fiscal year 2005 appropriation.......................       $506,982,000
Fiscal year 2006 budget request......................        169,156,000
Committee recommendation in the bill.................        444,256,000
Comparison with:
    Fiscal year 2005 appropriation...................       (62,726,000)
    Fiscal year 2006 budget request..................        275,100,000

    The Committee recommends an appropriation of $444,256,000 
for research and development for fiscal year 2006. This is a 
decrease of $62,726,000 below the fiscal year 2005 enacted 
level, not including supplemental funding, and an increase of 
$275,100,000 above the budget request. The Committee's 
recommendation is as follows:

                EXPLANATION OF PROJECT LEVEL ADJUSTMENTS
                        [In thousands of dollars]
------------------------------------------------------------------------
                                                             Committee
                                          Budget request    recommended
------------------------------------------------------------------------
Research, Development, Test and                  169,156         444,256
 Evaluation.............................
------------------------------------------------------------------------
    Air Force Surgeon General Server      ..............           3,500
     Consolidation Initiative...........
    Amyotrophic Lateral Sclerosis (ALS).  ..............           3,000
    Bethesda Hospitals Emergency          ..............           5,000
     Preparedness Partnership...........
    Bio-Molecular Material Composites     ..............           1,000
     Research Program...................
    Chronic Epilepsy in Severe Head       ..............           1,500
     Injuries...........................
    Computer Assisted Medical             ..............           1,500
     Diagnostics........................
    Copper Antimicrobial Research         ..............           2,000
     Program............................
    Directed Mission Upgrades of the      ..............           5,000
     Defense Medical Logistics Standard
     Support System (DMLSS).............
    Downed Pilot Forward Osmosis Water    ..............           4,100
     Filtration System..................
    Early Diagnosis, Treatment and Care   ..............           2,500
     of Cancer Patients.................
    Global HIV/AIDS Prevention Program..  ..............           7,500
    Healthcare Informatics Testbed......  ..............           2,500
    Leukemia Research (CMLRP)...........  ..............           5,000
    Metabolic Defense Research Program..  ..............           2,500
    Microencapsulation and Vaccine        ..............           3,000
     Delivery Research..................
    Muscle Research Consortium..........  ..............           3,500
    Peer Reviewed Breast Cancer Program.  ..............         115,000
    Peer Reviewed Prostate Cancer         ..............          80,000
     Program............................
    Peer Reviewed Ovarian Cancer Program  ..............          15,000
    Periscopic Surgery Research.........  ..............           2,500
    Stress Disorders Research Initiative  ..............           3,000
     @ Ft. Hood.........................
    Tuberous Sclerosis Complex (TSC)....  ..............           5,000
    United States Military Cancer Care    ..............           2,500
     Institute @ WRAMC..................
    Unobligated Balances (04-05)........  ..............         (2,100)
    Unobligated Balances-TMA (04-05)....  ..............         (5,900)
    USAF Environmental and Occupational   ..............           2,000
     Factors in Women's Health Program..
    USAF Military Burn Victim Treatment   ..............           2,000
     and Care...........................
    Water-Related Viral Disease           ..............           3,000
     Countermeasures for the Air Force..
------------------------------------------------------------------------

    Unobligated Balances.--The Committee has adjusted the 
amounts available for research and development in fiscal year 
2006 to account for funding left unobligated at the end of 
prior fiscal years and the effect of such under-obligations on 
estimated future requirements.
    Peer Reviewed Cancer Research.--The Committee has provided 
$210,000,000 for Peer Reviewed Cancer Research. These 
additional dollars are complementary to research funding that 
is currently provided by the National Institutes of Health 
(NIH) for cancer research. In fiscal year 2006 breast, ovarian, 
and prostate cancer research will receive $1,210,000,000 from 
the NIH.
    Directed Mission Upgrades of the Defense Medical Logistics 
Standard Support System (DMLSS).--The Department has mandated 
that its suppliers use Radio Frequency Identification (RFID) on 
all pallets and cases in the supply chain by 2008. For this to 
happen, RFID technology must be integrated into the Defense 
Medical Logistics Standard Support System (DMLSS) by January 1, 
2007. The Committee is concerned that the Office of the 
Secretary of Defense (OSD) mandated this policy initiative 
while at the same time allowing the TRICARE Management Activity 
to cut the budget for this program in fiscal year 2006. The 
budget request reduces the DMLSS development budget for new 
capabilities to the current application and defers development 
for this mandate to fiscal year 2009, completing development in 
fiscal year 2010 and deployment in fiscal year 2011, three 
years beyond the established OSD mandate. The Committee has 
provided $5,000,000 to prevent this program from slipping 
further and directs the Department to fully fund this 
initiative in the fiscal year 2007 budget and beyond to reach 
the Department's own established goal of January 1, 2007 for 
DMLSS and 2008 for the supply chain.
    Air Force Surgeon General Server Consolidation 
Initiative.--The Composite Occupational Health and Operational 
Risk Tracking (COHORT) system addresses the Air Force Surgeon 
General's need by providing real-time surveillance of the 
medical care and treatment of specified groups of military 
personnel across multiple medical health facilities throughout 
the world. However, the Committee is concerned that the Air 
Force Surgeon General does not have a viable integrated medical 
surveillance system to adequately execute the mission. 
Therefore, the Committee provides $3,500,000 for the Air Force 
Surgeon General's Server Consolidation Initiative to begin to 
deploy basic infrastructure to Military Treatment Facilities to 
enable better medical care in a more efficient manner and 
alleviate the need to query multiple databases to retrieve 
patient information.
    Water-Related Viral Disease Countermeasures.--The Committee 
provides $3,000,000 for Water-Related Viral Disease 
Countermeasures for the U.S. Air Force. The Committee believes 
that this vital research will enable the Air Force to protect 
its warfighters using therapeutics and vaccines.
    Copper Antimicrobial Research Program.--The Committee 
provides $2,000,000 for a Copper Antimicrobial Research program 
to validate the effectiveness of copper in deactivating 
dangerous microbes to reduce the incidence of infection in 
medical facilities.
    U.S. Air Force Military Burn Treatment.--The Committee 
provides $2,000,000 to the U.S. Air Force Surgeon General to 
enhance efforts at the mid-Atlantic specialized burn victim 
treatment center.
    Microencapsulation and Vaccine Delivery Research.--The 
Committee provides an additional $3,000,000 for research into 
one-time delivery of vaccines, drugs and antidotes to be used 
during deployment or training, when necessary.
    Bethesda Hospitals Emergency Preparedness Partnership 
(BHEPP).--The Committee provides an additional $5,000,000 for 
the BHEPP to enhance an emergency preparedness partnership 
between National Naval Medical Center, the Clinical Center at 
the national Institutes of Health and Suburban Hospital 
Healthcare System in order to use their complementary strengths 
to provide emergency preparedness that is beneficial to the 
National Capital Region.

                       ADMINISTRATIVE PROVISIONS

    The Administration proposed eliminating several 
administrative provisions enacted as general provisions in the 
Military Construction Appropriations and Emergency Hurricane 
Supplemental Appropriations Act, 2005 (P.L. 108-324), including 
sections 111, 113, 118, 121, 122, 126, 127, 128, 130, and 131.
    The Administration proposed eliminating two general 
provisions enacted as general provisions in the Department of 
Defense Appropriations Act, 2005 (P.L. 108-287), including 
sections 8018 and 8070.
    The Administration proposed two new administrative 
provisions. The first one allows for the transfer of expired 
funds to the ``Foreign Currency Fluctuations, Construction, 
Defense'' account. The second one amends section 8070 of the 
Department of Defense Appropriations Act, 2005 to allow the 
obligation of administrative costs for all military 
construction funded through operation and maintenance accounts. 
Administrative Provisions included in the bill are as follows:
    Section 101 limits DOD from spending funds appropriated in 
this title for payments under a cost-plus-a-fixed-fee contract 
for construction where cost estimates exceed $25,000. An 
exception for Alaska is provided.
    Section 102 permits the hire of passenger motor vehicles.
    Section 103 permits funds to be expended on the 
construction of defense access roads under certain 
circumstances.
    Section 104 prohibits construction of new bases in the 
United States without a specific appropriation.
    Section 105 limits the use of funds for the purchase of 
land or land easements that exceed 100 percent of value.
    Section 106 prohibits the use of funds to acquire land, 
prepare sites, or install utilities for family housing except 
housing for which funds have been appropriated.
    Section 107 limits the use of minor construction funds to 
be transferred or relocated from one installation to another.
    Section 108 prohibits the procurement of steel unless 
American producers, fabricators, and manufacturers have been 
allowed to compete.
    Section 109 limits appropriations from being used to pay 
real property taxes in foreign nations.
    Section 110 prohibits the use of funds to initiate a new 
installation overseas without prior notification.
    Section 111 establishes a preference for American 
architectural and engineering services where the services are 
in Japan, NATO member countries, and the Arabian Gulf.
    Section 112 establishes a preference for American 
contractors for military construction in the United States 
territories and possessions in the Pacific and on Kwajalein 
Atoll, or in the Arabian Gulf, except bids by Marshallese 
contractors for military construction on Kwajalein Atoll.
    Section 113 requires the Secretary of Defense to give prior 
notice to Congress of military exercises where construction 
costs exceed $100,000.
    Section 114 limits obligations to no more than 20 percent 
during the last two months of the fiscal year.
    Section 115 permits DOD to make available funds 
appropriated in prior years for new projects authorized during 
the current session of Congress.
    Section 116 permits the use of expired or lapsed funds to 
pay the cost of supervision for any project being completed 
with lapsed funds.
    Section 117 provides that funds for military construction 
projects are available until the end of the fourth fiscal year 
following the fiscal year in which funds are appropriated, 
subject to certain conditions.
    Section 118 requires the Secretary of Defense to report 
annually on actions taken during the current fiscal year to 
encourage other member nations of the NATO, Japan, Korea, and 
United States allies in the Arabian Gulf to assume a greater 
share of defense costs.
    Section 119 authorizes the transfer of proceeds from ``Base 
Realignment and Closure Account, Part I'' to the continuing 
Base Realignment and Closure accounts.
    Section 120 permits the transfer of funds from Family 
Housing, Construction accounts to the DOD Family Housing 
Improvement Fund.
    Section 121 limits the obligation of funds for Partnership 
for Peace Programs.
    Section 122 requires the Secretary of Defense to notify 
Congressional Committees sixty days prior to issuing a 
solicitation for a contract with the private sector for 
military family housing.
    Section 123 provides transfer authority to the Homeowners 
Assistance Program.
    Section 124 requires that appropriations from this title be 
the sole source of all operation and maintenance for flag and 
general officer quarter houses and limits the repair on these 
quarters to $35,000 per year without notification.
    Section 125 prohibits funds appropriated for the NATO 
Security Investment Program from being obligated or expended 
for the purpose of missile defense studies.
    Section 126 requires the Secretary of Defense or any other 
official of the Department of Defense to respond in writing to 
a question or inquiry submitted by the chairman or another 
member of the subcommittee within 21 days.
    Section 127 makes funds in the Ford Island Improvement Fund 
available until expended.
    Section 128 allows the transfer of expired funds to the 
``Foreign Currency Fluctuations, Construction, Defense'' 
account.
    Section 129 prohibits the reimbursement of any health care 
provider for inpatient mental health service for care received 
when a patient is referred to a provider of inpatient mental 
health care or residential treatment care by a medical or 
health care professional having an economic interest in the 
facility to which the patient is referred.
    Section 130 allows the distribution of surplus medical and 
dental equipment, at no cost to DOD, to Indian Health Service 
facilities and to federally qualified health centers.
    Section 131 prohibits the Secretary of Defense from 
spending funds provided for projects at installations 
identified for closure or realignment in BRAC 2005 without 
Congressional consent.
    Section 132 prohibits the use of funds for the operation, 
maintenance and repair of general and flag officers quarters in 
the National Capital Region until the Department of Defense 
submits a report required by law.

                                TITLE II


                     DEPARTMENT OF VETERANS AFFAIRS


Fiscal year 2005 appropriation.................      \1\ $65,838,832,000
Fiscal year 2006 budget request................           67,477,300,000
Committee recommendation in the bill...........           68,112,300,000
Comparison with:
    Fiscal year 2005 appropriation.............            2,273,468,000
    Fiscal year 2006 budget request............              635,000,000
\1\ Includes impact of 0.8% rescission totaling $246,828,040 pursuant to
  Public law 108-447 and additional funding of $124,070,000 pursuant to
  Public Law 108-324, the Military Construction Appropriation and
  Emergency Hurricane Supplemental Appropriations Act, 2005.
All funding cited above excludes amounts in the Medical Care Collections
  Fund.

    The Department of Veterans Affairs is one of the largest 
Federal agencies in terms of employment with an average 
employment of approximately 218,077. It administers benefits 
for more than 24,800,000 veterans, and 38,363,200 family 
members of living veterans and survivors of deceased veterans. 
Thus, close to 63,000,000 people, comprising about 21 percent 
of the total population of the United States, are potential 
recipients of veterans benefits provided by the Federal 
government.
    The Committee recommends a total of $68,112,300,000 in new 
budget authority for programs in fiscal year 2006. This is an 
increase of $2,273,468,000 above the fiscal year 2005 enacted 
level and an increase of $635,000,000 above the budget request.
    The funds recommended provide compensation payments to 
3,023,329 veterans and survivors of deceased veterans with 
service-connected disabilities; pension payment to 532,414 non-
service-connected disabled veterans, widows and children in 
need of financial assistance; education training, tuition 
assistance, and vocational assistance to 575,421 veterans, 
servicepersons, and reservists, and 80,094 eligible dependents 
of deceased veterans or seriously disabled veterans; housing 
credit assistance in the form of 300,000 guaranteed loans to 
veterans and servicepersons; administration or supervision of 
life insurance programs with 7,385,456 policies for veterans 
and active duty servicepersons providing coverage of 
$756,138,000,000; inpatient care and treatment of beneficiaries 
in 157 hospitals, 42 VA domiciliary residential rehabilitation 
treatment programs (formerly called ``domiciliaries''), 134 
nursing homes, and 944 outpatient clinics which includes 
independent, satellite, community-based, and rural outreach 
clinics involving 61,555,000 visits; and administration of the 
National Cemetery Administration for burial of eligible 
veterans, servicepersons and their survivors.
    The VA submitted the 2006 budget request in an alternative 
appropriations structure for the year. The Committee once again 
rejects this new structure because it does not address the 
needs of the Congress in its role of reviewing and allocating 
federal budgetary resources. The Committee directs the 
Secretary to submit the fiscal year 2007 budget justifications 
based on the fiscal year 2006 appropriation structure.

                    Veterans Benefits Administration


                       COMPENSATION AND PENSIONS

                     (INCLUDING TRANSFER OF FUNDS)

Fiscal year 2005 appropriation........................   $32,607,688,000
Fiscal year 2006 budget request.......................    33,412,879,000
Committee recommendation in the bill..................    33,412,879,000
Comparison with:
    Fiscal year 2005 appropriation....................       805,191,000
    Fiscal year 2006 budget request...................  ................

    This appropriation provides funds for service-connected 
compensation payments to an estimated 3,023,329 beneficiaries 
and pension payments to another 532,413 beneficiaries with non-
service-connected disabilities. The average cost per 
compensation case in 2006 is estimated at $10,081, and pension 
payments are projected at a unit cost of $6,475.
    The Committee recommends an appropriation of 
$33,412,879,000 for compensation, pension and burial benefits 
for fiscal year 2006. This is an increase of $805,191,000 above 
the fiscal year 2005 enacted level and the same as the budget 
request.
    The appropriation includes funding not to exceed 
$23,491,000 in payments to the general operating expenses 
account of which $9,740,000 is for the medical administration 
account and $13,751,000 is for administrative expenses of 
implementing cost saving provisions required by the Omnibus 
Budget Reconciliation Act of 1990, Public Law 101-508, the 
Veterans' Benefits Act of 1992, Public Law 102-568, and the 
Veterans' Benefits Improvements Act of 1994, Public Law 103-
446. These cost savings provisions include verifying pension 
income against Internal Revenue Service and Social Security 
Administration (SSA) data; establishing a match with the SSA to 
obtain verification of Social Security numbers; and the $90 
monthly VA pension cap for Medicaid-eligible single veterans 
and surviving spouses alone in Medicaid-covered nursing homes. 
The bill includes requested language permitting this 
appropriation to reimburse such sums as may be earned to the 
medical care collections fund to help defray the operating 
expenses of individual medical facilities for nursing home care 
provided to pensioners.
    The Administration has proposed to provide a cost-of-living 
adjustment, based on the change in the Consumer Price Index, to 
all compensation beneficiaries, including dependency and 
indemnity compensation for spouses and children. It is 
currently estimated at 2.3 percent. This is the same as the 
COLA that will be provided, under current law, to veterans 
pension and Social Security recipients. The increase, effective 
December 1, 2005, has an estimated cost of $478,294,000 during 
fiscal year 2006 and is reflected in the Compensation and 
Pensions budget request, pending authorization approval.
    The Administration has proposed language that would provide 
indefinite 2006 supplemental appropriations for compensation 
and pension payments. The Committee believes current procedures 
are adequate and has not included the requested language in the 
bill.

                         READJUSTMENT BENEFITS

Fiscal year 2005 appropriation........................    $2,556,232,000
Fiscal year 2006 budget request.......................     3,214,246,000
Committee recommendation in the bill..................     3,214,246,000
Comparison with:
    Fiscal year 2005 appropriation....................       658,014,000
    Fiscal year 2006 budget request...................  ................

    This appropriation finances the education and training of 
veterans and servicepersons whose initial entry on active duty 
took place on or after July 1, 1985. These benefits are 
included in the All-Volunteer Force Educational Assistance 
Program. Eligibility to receive this assistance began in 1987. 
Basic benefits are funded through appropriations made to the 
readjustment benefits appropriation and transfers from the 
Department of Defense. Supplemental benefits are also provided 
to certain veterans through education assistance to certain 
members of the Selected Reserve and are funded through 
transfers from the Departments of Defense and Homeland 
Security. In addition, certain disabled veterans are provided 
with vocational rehabilitation, specially adapted housing 
grants, and automobile grants with approved adaptive equipment.
    This account also finances educational assistance 
allowances for eligible dependents of those veterans who died 
from service-connected causes or have a total and permanent 
service-connected disability as well as dependents of 
servicepersons who were captured or missing-in-action.
    The Committee recommends an appropriation of $3,214,246,000 
for readjustment benefits in fiscal year 2006. This is an 
increase of $658,014,000 above the fiscal year 2005 enacted 
level and the same as the budget request. The increase is 
primarily due to expanded benefits for Reserve personnel 
ordered to active service and changes in the Montgomery GI Bill 
education program. The fiscal year 2005 funding cited does not 
reflect a transfer from Compensation and Pensions to 
Readjustment Benefits necessary to execute program changes 
enacted for fiscal year 2005, which would have the effect of 
lowering this year-to-year increase by about $185,000,000.
    Task Force on VRE Benefits.--The Committee is aware that 
the Department's Task Force on the Vocational Rehabilitation 
and Employment benefits program made extensive recommendations 
for changes that have not yet been fully implemented. The 
Committee believes this area of Veterans Benefits deserves 
focused attention and directs the Department to report to the 
Committee by July 1, 2005 on its efforts to implement the Task 
Force recommendations. The Committee will use this information 
as we move forward with this bill to ensure that the proper 
resources are put into the program to ensure its success.

                   VETERANS INSURANCE AND INDEMNITIES

Fiscal year 2005 appropriation........................       $44,380,000
Fiscal year 2006 budget request.......................        45,907,000
Committee recommendation in the bill..................        45,907,000
Comparison with:
    Fiscal year 2005 appropriation....................         1,527,000
    Fiscal year 2006 budget request...................  ................

    The veterans insurance and indemnities appropriation is 
made up of the former appropriations for military and naval 
insurance, applicable to World War I veterans; national service 
life insurance (NSLI), applicable to certain World War II 
veterans; servicemen's indemnities, applicable to Korean 
conflict veterans; and the veterans mortgage life insurance, 
applicable to individuals who have received a grant for 
specially adapted housing.
    The Committee recommends an appropriation of $45,907,000 
for veterans insurance and indemnities in fiscal year 2006. 
This is an increase of $1,527,000 above the fiscal year 2005 
enacted level and the same as the budget request. The amount 
provided will enable VA to transfer funding to the service-
disabled veterans insurance fund and transfer additional 
amounts for payments for the 2,470 policies under the veterans 
mortgage life insurance program. These policies are identified 
under the veterans' insurance and indemnity appropriation since 
they provide insurance to service-disabled veterans unable to 
qualify under basic NSLI.
    The Administration has proposed language that would provide 
indefinite 2006 supplemental appropriations for the insurance 
program. The Committee believes current procedures are adequate 
and has not included the requested language in the bill.

         VETERANS HOUSING BENEFIT PROGRAM FUND PROGRAM ACCOUNT

                     (INCLUDING TRANSFER OF FUNDS)

----------------------------------------------------------------------------------------------------------------
                                                                                   Limitation on
                                                                                   direct loans
                                                                      Program      for specially  Administrative
                                                                      account         adapted        expenses
                                                                                   housing loans
----------------------------------------------------------------------------------------------------------------
Fiscal year 2005 appropriation..................................  \1\ $43,784,00        $500,000    $152,842,000
                                                                               0
Fiscal year 2006 budget request.................................      64,586,000         500,000     153,575,000
Committee recommendation in the bill............................      64,586,000         500,000     153,575,000
Comparison with:
    Fiscal year 2005 appropriation..............................    (20,802,000)  ..............         733,000
    Fiscal year 2006 budget request.............................  ..............  ..............  ..............
----------------------------------------------------------------------------------------------------------------
\1\ Reflects subsidy estimate from last year's report. The new estimate for 2005 is $1,900,392.

    The purpose of the VA home loan guaranty program is to 
facilitate the extension of mortgage credit on favorable terms 
by private lenders to eligible veterans. This appropriation 
provides for all costs, with the exception of the native 
American veterans housing loan program, of the Department's 
direct and guaranteed loans programs. The Federal Credit Reform 
Act of 1990 requires budgetary resources to be available prior 
to incurring a direct loan obligation or a loan guaranty 
commitment. In addition, the bill requires all administrative 
expenses of a direct or guaranteed loan program to be funded 
through a program account. VA loan guaranties are made to 
service members, veterans, reservists, and single surviving 
spouses for the purchase of homes, condominiums, and 
manufactured homes and for refinancing loans. The Department 
guarantees part of the total loan, permitting the purchaser to 
obtain a mortgage with a competitive interest rate, even 
without a down payment if the lender agrees. The Department 
requires that a down payment be made for a manufactured home. 
With a Department guaranty, the lender is protected against 
loss up to the amount of the guaranty if the borrower fails to 
repay the loan.
    The Committee recommends such sums as may be necessary 
(currently estimated to total $64,586,000) for funding subsidy 
payments, $500,000 for the limitation on direct loans for 
specially adapted housing loans, and $153,575,000 for 
administrative expenses. The appropriation for administrative 
expenses may be transferred to and merged with the General 
Operating Expenses account.

            VOCATIONAL REHABILITATION LOANS PROGRAM ACCOUNT

                     (INCLUDING TRANSFER OF FUNDS)

------------------------------------------------------------------------
                                              Limitation
                                  Program     on direct   Administrative
                                  account       loans        expenses
------------------------------------------------------------------------
Fiscal year 2005 appropriation      $47,000   $4,108,000       $309,000
Fiscal year 2006 budget              53,000    4,242,000        305,000
 request......................
Committee recommendation in          53,000    4,242,000        305,000
 the bill.....................
Comparison with:
    Fiscal year 2005                  6,000      134,000        (4,000)
 appropriation................
    Fiscal year 2006 budget     ...........  ...........  ..............
 request......................
------------------------------------------------------------------------

    This appropriation covers the funding subsidy cost of 
direct loans for vocational rehabilitation of eligible veterans 
and, in addition, it includes administrative expenses necessary 
to carry out the direct loan program. Loans of up to $948.54 
(based on indexed chapter 31 subsistence allowance rate) are 
available to service-connected disabled veterans enrolled in 
vocational rehabilitation programs when the veteran is 
temporarily in need of additional assistance. Repayment is made 
in monthly installments, without interest, through deductions 
from future payments of compensation, pension, subsistence 
allowance, educational assistance allowance, or retirement pay. 
Most loans are repaid in full in less than one year. The 
Federal Credit Reform Act of 1990 requires budgetary resources 
to be available prior to incurring a direct loan obligation. In 
addition, the Act requires all administrative expenses of a 
direct loan program to be funded through a program account.
    The Committee recommends the budget requests of $53,000 for 
funding subsidy program costs and $305,000 for administrative 
expenses. The administrative expenses may be transferred to and 
merged with the General Operating Expenses account.
    In addition, the Committee includes language limiting 
program direct loans to $4,242,000, the same as the budget 
request. It is estimated that VA will make 4,634 loans in 
fiscal year 2006, with an average amount of $926.

          NATIVE AMERICAN VETERAN HOUSING LOAN PROGRAM ACCOUNT

                     (INCLUDING TRANSFER OF FUNDS)

Administrative expenses:..............................
    Fiscal year 2005 appropriations...................          $566,000
    Fiscal year 2006 budget recommendation............           580,000
Committee recommendation in the bill..................           580,000
Comparison with:
    Fiscal year 2005 appropriation....................            14,000
    Fiscal year 2006 budget request...................  ................


    This program tests the feasibility of authorizing VA to 
make direct home loans to Native American veterans who live on 
U.S. trust land. This is a pilot program which began in 1993 
and expires on December 31, 2008. The Committee recommends the 
budget request of $580,000 for administration expenses, which 
may be transferred to and merged with the General Operating 
Expenses account.

  GUARANTEED TRANSITIONAL HOUSING LOANS FOR HOMELESS VETERANS PROGRAM 
                                ACCOUNT

                     (INCLUDING TRANSFER OF FUNDS)

    Public Law 105-368, the Veterans Programs Enhancement Act 
of 1998, established this program. All funds authorized for 
this program were appropriated in fiscal year 2000. Therefore, 
no appropriation request has been included for fiscal year 
2006. Bill language is included allowing the use of funds in 
Medical Administration and General Operating Expenses to 
administer this program up to a total of $750,000.

                     Veterans Health Administration

    The VA operates the largest Federal medical care delivery 
system in the country, with 157 hospitals, 42 VA domiciliary 
residential rehabilitation treatment programs (formerly called 
``domiciliaries''), 134 nursing homes, and 944 outpatient 
clinics which includes independent, satellite, community-based, 
and rural outreach clinics.
    In 2004, Congress agreed to fund Veterans Health 
Administration (VHA) through a new account structure comprised 
of four accounts: medical services, medical administration, 
medical facilities, and medical and prosthetic research. This 
action was taken to provide better oversight and receive a more 
accurate accounting of funds. This four account structure will 
continue in 2006. Under this structure, the Administration has 
requested total resources of $28,203,684,000 in direct 
appropriations and $2,170,000,000 in Medical Care Collections 
Fund appropriations, to fund the various operating programs of 
the VHA. The budget request assumes a number of Presidential 
policy changes that as of this time have not been adopted by 
the Congress. The Committee recommendation of $28,820,684,000 
in direct appropriations and $2,170,000,000 in Medical Care 
Collections appropriations does not prejudge action on these 
policy proposals.

                            MEDICAL SERVICES

                     (INCLUDING TRANSFER OF FUNDS)

Fiscal year 2005 appropriation........................   $19,355,278,000
Fiscal year 2006 budget request.......................    19,995,141,000
Committee recommedation in the bill...................    20,995,141,000
Comparison with:
    Fiscal year 2005 appropriation....................     1,639,863,000
    Fiscal year 2006 budget request...................     1,000,000,000

    This Medical Services appropriation provides for medical 
services of eligible veterans and beneficiaries in VA medical 
centers, outpatient clinic facilities, contract hospitals, 
State homes, and outpatient programs on a fee basis. Hospital 
and outpatient care is also provided by the private sector for 
certain dependents and survivors of veterans under the civilian 
health and medical programs for the Department of Veterans 
Affairs.
    The Committee recommends an appropriation of 
$20,995,141,000 for Medical Services. This is an increase of 
$1,000,000,000 above the budget request and an increase of 
$1,639,863,000 above the fiscal year 2005 enacted level. The 
Committee does not agree with the budget proposal to restrict 
payments to State Homes for long-term care and directs the 
Secretary to work with the National Association of State 
Veterans Homes and other stakeholders to develop and implement 
solutions that will give our veterans the best options for 
quality long-term care at the most reasonable cost to the 
taxpayer. The funding provided is sufficient to continue the 
policy regarding State Homes that was in effect prior to 
submission of the budget request.
    Within the amount provided in the Medical Services 
appropriation, not less that $2,200,000,000 is designated for 
specialty mental health care. During the budget hearing earlier 
this year, the Department's Undersecretary for Health 
Administration testified that the budget supported this level 
of funding. The Undersecretary further testified that although 
there is a statutory definition for mental illness, the breadth 
of mental health care services will approach $3,000,000,000 and 
the entirety of health care supporting veterans with mental 
illness will approach $10,000,000,000. The Committee has taken 
the unusual action of fencing a portion of medical services 
funding for one category of treatment because the Committee 
recognizes the need to dedicate resources to such treatment and 
wishes to be assured that funding for mental health care will 
not be siphoned off for other purposes during the year of 
execution.
    The bill includes requested language in the Compensation 
and Pension appropriation transferring $13,751,000 for 
administrative expenses of implementing cost saving provisions 
required by the Omnibus Budget Reconciliation Act of 1990, and 
the Veterans' Benefits Act of 1992.
    The Committee has included bill language to allow the 
Secretary to transfer funds between the Medical Services 
appropriation, Medical Administration appropriation, and 
Medical Facilities appropriation with a limitation on transfers 
up to 20 percent as necessary after notifying the Committees on 
Appropriations. This authority is to be used solely for the 
purpose of perfecting the accounts as the three-account 
structure is implemented.
    The Committee has included bill language to make available 
through September 30, 2007, up to $1,100,000,000 of the Medical 
Services appropriation. This provides flexibility to the 
Department as it continues to implement significant program 
changes.
    The bill also includes requested language for the DoD/VA 
Health Care Sharing Incentive Fund, as authorized by section 
721 of the Fiscal Year 2003 National Defense Authorization Act, 
Public Law 107-314, to transfer a minimum of $15,000,000, to 
remain available until expended, for any purpose authorized by 
38 U.S.C. 8111.
    Integrated Information Technology.--The Committee is aware 
that the VA has entered into a Cooperative Research and 
Development Agreement (CRADA) to develop technologies that 
would integrate information from peripheral medical devices 
into a centralized monitoring system. It is understood that if 
successful, this technology could reduce medical errors and 
improve the quality of health care. The Committee directs the 
VA to report back on the results of the CRADA and expects the 
Department of Veterans Affairs to dedicate the resources 
necessary to complete the CRADA full trial.
    Multiple Sclerosis.--The Committee is aware that the 
Department's process for allocating health care funding is 
based upon categories of care, including basic care and complex 
care. While in most cases the Department would classify 
Multiple Sclerosis patients as needing only basic care, in 
fact, even in its earliest phase this condition requires 
intensive treatment and therapy. With this in mind, the 
Committee urges the Department to review and provide a report 
to the Committee on changing the status of MS patients to that 
of complex care to ensure that each VISN and hospital gets the 
resources it needs to provide comprehensive care for these 
patients.
    Distance Learning.--The Committee recognizes the need for 
VAMC health professionals to master complex technologies and to 
build and maintain those skills. The Committee supports an 
initiative to demonstrate the potential effectiveness of a two-
way broadband web-based tele-training system for medical 
training between the VAMC in Syracuse and the Upstate Medical 
University of the State University of New York.
    Assistive Devices Technology.--Given the large number of 
wounded soldiers returning from Iraq and Afghanistan, our aging 
population, and the increase in people suffering from diabetes, 
assistive devices that do not cause additional harm to the 
patients they are designed to help are needed. Therefore, the 
Committee urges the Department of Veterans Affairs to institute 
a pilot program to develop capabilities such as portable non-
invasive transfer devices, individual monitoring systems for 
wound healing, and innovative mechanisms for rehabilitation and 
physical/mental stimulation for those patients with assistive 
technology needs.
    Data Warehouses for Medications.--The Committee notes that 
in the past the Department has saved significant amounts of 
money by using generic versus patented medications and believes 
there is more potential in this area if the correct information 
is available to the Department. With this in mind, the 
Committee directs the Department to report on its efforts to 
develop and utilize an extensive data warehouse for medication 
comparisons, as well as the patient privacy issues associated 
with such an effort.

                     MEDICAL CARE COLLECTIONS FUND

    The Department of Veterans Affairs Medical Care Collections 
Fund (MCCF) was established by the Balanced Budget Act of 1997 
(Public Law 105-33). The Department deposits first-party and 
pharmacy co-payments, third-party insurance payments and 
enhanced-use collections, long-term care co-payments, 
Compensated Work Therapy Program collections, Compensation and 
Pension Living Expenses Program collections, and Parking 
Program fees into the MCCF. The estimate of fees that will be 
collected in fiscal year 2006 is $2,170,000,000. The bill does 
not include any language regarding the Medical Care Collections 
Fund since permanent authority was included in the fiscal year 
2005 appropriations bill, Public Law 108-447.

                         MEDICAL ADMINISTRATION

                     (INCLUDING TRANSFER OF FUNDS)

Fiscal year 2005 appropriation........................    $4,669,300,000
Fiscal year 2006 budget request.......................     4,517,874,000
Committee recommendation in the bill..................     4,134,874,000
Comparison with:
    Fiscal year 2005 appropriation....................     (534,426,000)
    Fiscal year 2006 budget request...................     (383,000,000)

    The Medical Administration appropriation provides funds for 
the expenses of management and administration of the VA health 
care system. Included under this heading are provisions for 
costs associated with operation of VA medical centers, other 
facilities, and VHA headquarters, plus the costs of VISN 
offices and facility director offices, chief of staff 
operations, quality of care oversight, all information 
technology hardware and software, legal services, billing and 
coding activities, and procurement.
    The Committee recommends $4,134,874,000 for Medical 
Administration, a decrease of $534,426,000 when compared to the 
fiscal year 2005 appropriation and a decrease of $383,000,000 
from the budget request. The Committee recommendation includes 
a reduction of $383,000,000 from the budget request for 
information technology programs. The budget request for all 
information technology programs in fiscal year 2006 is 
$1,076,950,000, an increase of $385,740,000 when compared to 
the fiscal year 2005 program. The requested increase, most of 
it tied to one project, has not been adequately justified in 
the budget or in responses to questions asked during the budget 
hearing earlier this year. Therefore, the Committee 
recommendation does not include funding for the HealtheVet-
VistA project in fiscal year 2006. The Committee recommendation 
also denies the increase of $40,000,000 (an increase of more 
than 10%) associated with the VistA Legacy project. Additional 
reductions are derived from the VHA portion of the CoreFLS 
program reduction and the VA computing infrastructure reduction 
addressed under the General Operating Expenses account.
    The Committee has included bill language to make available 
through September 30, 2007, up to $250,000,000 of the Medical 
Administration appropriation. This provides flexibility to the 
Department as it continues to implement significant program 
changes.
    The Committee has included bill language to allow the 
Secretary to transfer funds between the Medical Services 
appropriation, Medical Administration appropriation, and 
Medical Facilities appropriation with a limitation on transfers 
up to 20 percent as necessary after notifying the Committees on 
Appropriations.
    The bill does not include language, proposed in the budget, 
which would allow funds to be used for cost comparison studies.
    Revenue Improvement Demonstration.--The Committee 
recommends $10,000,000 in funding to initiate a new pilot 
program that will provide a comprehensive restructuring of the 
complete revenue improvement cycle including cash flow 
management and accounts receivable processes in certain VA 
hospital(s). The Committee envisions the implementation of this 
project be achieved through the execution of a performance-
based contract with a vendor, who has demonstrated extensive 
success in substantially reducing accounts receivable, 
increasing cash flow, reducing operating expenses and 
significantly improving revenue collections. The VHA Chief 
Business Officer must have the concurrence of the VA Chief 
Information Officer on the business plan for this 
demonstration. The Department must initiate this demonstration 
by September 30, 2005 and provide quarterly progress reports to 
the Committees on Appropriations and Veterans' Affairs.
    Contract Care Coordination.--The Committee agrees with the 
recommendations submitted for the second year in a row in this 
year's budget hearings by the Independent Budget veterans' 
service organizations that encourages the Department to 
implement by the end of this calendar year the first phase, 
including at least three VISN's, a program that will fully 
integrate in-house and community care for enrolled veterans.
    The Committee directs the Department to contract with a 
managed care company with experience in this arena and having 
national experience working with the Department to implement 
this program in 2005. To fully take advantage of such an 
initiative, this program needs to include an electronic claims 
processing component, a standardized approach to providing non-
VA care, allow VA to meet community access standards, ensure 
that the records of veterans being treated in the community are 
returned to VA and have credentialed provider networks to 
address timeliness, access, and cost effectiveness.
    The current preferred pricing program should be 
incorporated into this new community care coordination program, 
and, as it is rolled out across the country in phase two, cost-
savings will be greatly enhanced. Preferred pricing is 
currently saving the Department $1,700,000 per month. When 
fully implemented, preferred pricing alone can save the 
Department $40,000,000 per year. However, this community care 
coordination program with a preferred pricing program 
incorporated, is projected to save the Department $400,000,000 
per year. While at the same time improving patient 
satisfaction, clinical results, and allowing the Department to 
manage its own resources, budget planning, and hiring more 
efficiently.
    The Committee will review the progress of this program's 
Phase I implementation in Committee hearings held in 2006 and, 
assuming it is meeting the objectives outlined above, will 
expect that the Department will expand its scope nationwide. 
Thus, the Phase I contract should be structured to allow the 
contractor to move ahead without delay for a nationwide 
implementation.

                           MEDICAL FACILITIES

                     (INCLUDING TRANSFER OF FUNDS)

Fiscal year 2005 appropriation........................    $3,761,949,000
Fiscal year 2006 budget request.......................     3,297,669,000
Committee recommendation in the bill..................     3,297,669,000
Comparison with:
    Fiscal year 2005 appropriation....................     (464,280,000)
    Fiscal year 2006 budget request...................  ................

    The Medical Facilities appropriation provides funds for the 
operation and maintenance of the VA health care system's vast 
capital infrastructure. Included under this heading are 
provisions for costs associated with utilities, engineering, 
capital planning, leases, laundry and food services, 
groundskeeping, garbage, housekeeping, facility repair, and 
property disposition and acquisition.
    The Committee recommends $3,297,669,000 for Medical 
Facilities, a decrease of $464,280,000 from the fiscal year 
2005 appropriation level and the same as the budget request.
    The Committee has included bill language to allow the 
Secretary to transfer funds between the Medical Services 
appropriation, Medical Administration appropriation, and 
Medical Facilities appropriation with a limitation on transfers 
up to 20 percent as necessary after notifying the Committees on 
Appropriations.
    The Committee has included bill language to make available 
through September 30, 2007, up to $250,000,000 of the Medical 
Facilities appropriation. This provides flexibility to the 
Department as it continues to implement significant program 
changes.
    Community Based Outpatient Clinics.--The Committee has 
received numerous requests for funding specific Community Based 
Outpatient Clinics (CBOCs) but has retained the practice of not 
earmarking funds for these facilities. However, the Committee 
is concerned that the promises made as a result of the final 
recommendations of the Capital Asset Realignment for Enhanced 
Services Commission may not be kept due to a variety of 
reasons. The Committee directs the Department to report on the 
status of CBOCs in Bessemer, Alabama; Richmond County (Hamlet), 
North Carolina; Conroe, Texas; Athens, Tennessee; and North 
Central Washington, including the reasons for any delay 
associated with their establishment. In addition, the Committee 
urges the Department to re-evaluate the need for CBOCs in 
Capitola, California; Jackson County, Florida; Levittown (Bucks 
County), Pennsylvania; Sunbury (Northumberland County), 
Pennsylvania; Bellingham, Washington; and Gladstone, Michigan.

                    MEDICAL AND PROSTHETIC RESEARCH

Fiscal year 2005 appropriation........................      $402,348,000
Fiscal year 2006 budget request.......................       393,000,000
Committee recommendation in the bill..................       393,000,000
Comparison with:
    Fiscal year 2005 appropriation....................       (9,348,000)
    Fiscal year 2006 budget request...................  ................

    This account includes medical, rehabilitative and health 
services research. Medical research is an important aspect of 
the Department's programs, providing complete medical and 
hospital services for veterans. The prosthetic research program 
is also essential in the development and testing of prosthetic, 
orthopedic and sensory aids for the purpose of improving the 
care and rehabilitation of eligible disabled veterans, 
including amputees, paraplegics and the blind. The health 
service research program provides unique opportunities to 
improve the effectiveness and efficiency of the health care 
delivery system. In addition, budgetary resources from a number 
of areas including appropriations from the medical care 
accounts; reimbursements from the Department of Defense; and 
grants from the National Institutes of Health, private 
proprietary sources, and voluntary agencies provide support for 
the Department's researchers.
    The Committee recommends $393,000,000 for Medical and 
Prosthetic Research, the same as the budget request and a 
decrease of $9,348,000 when compared to the fiscal year 2005 
appropriation.
    Hepatitis C.--The Committee is concerned with the long-term 
consequences of hepatitis C infection on veterans, including 
the development of primary liver cancer. The Committee is also 
concerned about the long-term consequences of hepatitis C in 
those with HIV infection. Given the unique capabilities of the 
VA system, the Committee urges the VA to consider developing 
multi-center trials for management of primary liver cancer and 
treatment of HCV/HIV co-infection.
    Mental Health Research.--In the opinion of most experts in 
the field, mental health issues will be the most pressing 
problem for the Department of Veterans Affairs in the coming 
years. The Committee is concerned that in fiscal year 2005 the 
Department of Veterans Affairs' researchers are expecting to 
execute mental health research projects totaling $56,000,000 
out of a total of $784,000,000 in funding from various sources, 
including its own budget. This accounts for only 7% of the 
total resources available to the Department's researchers being 
spent on one of the most pressing issues facing the Department. 
The Committee believes that more effort into research will lead 
to earlier identification of problems and more effective 
treatment, thereby reducing the long-term complications and 
costs associated with mental health issues. As a goal for 
fiscal year 2006, the Committee believes the Department should 
dedicate at least 20% of its research budget to dealing with 
the issues of mental health diagnosis and treatment. The 
Committee directs the Department to establish this goal and 
work toward achieving the goal by focusing its investments in 
facilities with mental health specialization. Any significant 
deviation from this goal shall be reported to the Committee by 
the third quarter of fiscal year 2006 with explanations as to 
why the goal was not met and remedies being put in place to 
achieve the goal in the future.
    Research Equipment and Facilities.--The Committee is 
concerned that equipment and facilities to support the research 
program of the Department may be lacking and that some 
mechanism is necessary to ensure the Department's research 
facilities remain competitive. In order to successfully compete 
for research grants, the Committee believes that more resources 
may be required to ensure that research facilities are properly 
maintained to support the Department's research mission. The 
Committee directs the Department to undertake a comprehensive 
review of its research facilities and report to the Congress on 
the deficiencies found and suggestions for correction of the 
identified deficiencies.
    Stress Disorders Research.--The Committee recognizes the 
Waco VAMC as a national resource in psychiatric care for 
veterans and directs the VA to leverage the relationship 
between the Waco VA and nearby Fort Hood to further PTSD 
research. The Committee notes that the Stress Disorders 
Research Initiative is funded at Fort Hood through the Defense 
Health Program, and directs the Waco VAMC to work with Fort 
Hood on this effort.

                      Departmental Administration


                       GENERAL OPERATING EXPENSES

Fiscal year 2005 appropriation........................    $1,314,700,000
Fiscal year 2006 budget request.......................     1,418,827,000
Committee recommendation in the bill..................     1,411,827,000
Comparison with:
    Fiscal year 2005 appropriation....................        97,127,000
    Fiscal year 2006 budget request...................       (7,000,000)

    The General Operating Expenses appropriation provides for 
the administration of non-medical veterans benefits through the 
Veterans Benefits Administration (VBA) and Departmental 
management and support. The Federal Credit Reform Act of 1990 
changed the accounting of Federal credit programs and required 
that all administrative costs associated with such programs be 
included within the respective credit accounts. Beginning in 
fiscal year 1992, costs incurred by housing, education, and 
vocational rehabilitation programs for administration of these 
credit programs are reimbursed by those accounts. The bill 
includes the budget requests totaling $154,459,500 in other 
accounts for these credit programs. In addition, $9,740,000 is 
transferred from the compensation and pensions account for 
administrative costs of implementing cost saving provisions 
required by the Omnibus Budget Reconciliation Act of 1990 and 
the Veterans' Benefits Act of 1992. Section 207 of the 
administrative provisions provides requested language which 
permits excess revenues in three insurance funds to be used for 
administrative expenses. The VA estimates that $40,928,000 will 
be utilized for such purposes in fiscal year 2006. Prior to 
fiscal year 1996, such costs were included in the general 
operating expenses appropriation. In total, $2,052,093,000 is 
requested in fiscal year 2006 for administrative costs of non-
medical benefits.
    The Committee recommends $1,411,827,000 for General 
Operating Expenses, a decrease of $7,000,000 from the budget 
request and an increase of $97,127,000 when compared to the 
fiscal year 2005 appropriation. The Committee recommendation 
includes a reduction of $30,000,000 ($1,000,000 in this account 
and $29,000,000 in the Medical Administration account) from the 
budget request of $70,100,000 from the CoreFLS project and 
$20,000,000 ($6,000,000 in this account and $14,000,000 in the 
Medical Administration account) from the VA computing 
infrastructure program. The amount of funding remaining in both 
these efforts will be sufficient to carry on existing 
activities, particularly in the case of CoreFLS where the 
effort to be accomplished is not yet defined.

                    NATIONAL CEMETERY ADMINISTRATION

Fiscal year 2005 appropriation........................      $147,784,000
Fiscal year 2006 budget request.......................       156,447,000
Committee recommendation in the bill..................       156,447,000
Comparison with:
    Fiscal year 2005 appropriation....................         8,663,000
    Fiscal year 2006 budget request...................  ................

    The National Cemetery Administration was established in 
accordance with the National Cemeteries Act of 1973. It has a 
fourfold mission: to provide for the interment in any national 
cemetery with available grave space the remains of eligible 
deceased servicepersons and discharged veterans, together with 
their spouses and certain dependents, and to permanently 
maintain their graves; to mark graves of eligible persons in 
national and private cemeteries; to administer the grant 
program for aid to States in establishing, expanding, or 
improving State veterans' cemeteries; and to administer the 
Presidential Memorial Certificate Program. This appropriation 
provides for the operation and maintenance of 158 cemeterial 
installations in 39 States, the District of Columbia, and 
Puerto Rico.
    The Committee recommends $156,447,000 for the National 
Cemetery Administration, an increase of $8,663,000 when 
compared to the fiscal year 2005 appropriation and the same as 
the budget request for fiscal year 2006. Funding for new 
cemetery construction and other associated costs are included 
in the Construction, Major Projects account.
    Fort Ord, California.--The Committee is concerned that land 
located at Fort Ord, California and set-aside for a cemetery is 
not being used for that purpose due to established policies 
that may not have adequately considered situations that exist 
at Fort Ord. The Committee directs the Secretary and the 
Undersecretary for Memorial Affairs to examine the unique 
situation at Fort Ord and report back to the Committee by 
September 30, 2005 on what is necessary for the Department to 
make use of this site.

                      OFFICE OF INSPECTOR GENERAL

Fiscal year 2005 appropriation........................       $69,153,000
Fiscal year 2006 budget request.......................        70,174,000
Committee recommendation in the bill..................        70,174,000
Comparison with:
    Fiscal year 2005 appropriation....................         1,021,000
    Fiscal year 2006 budget request...................  ................

    The Office of Inspector General was established by the 
Inspector General Act of 1978 and is responsible for the audit, 
investigation and inspection of all Department of Veterans 
Affairs programs and operations. The overall operational 
objective is to focus available resources on areas which would 
help improve services to veterans and their beneficiaries, 
assist managers of Department programs to operate economically 
in accomplishing program goals, and prevent and deter recurring 
and potential fraud, waste and inefficiencies.
    The Committee recommends the budget request of $70,174,000 
for the Office of Inspector General, an increase of $1,021,000 
when compared to the fiscal year 2005 appropriation.

                      CONSTRUCTION, MAJOR PROJECTS

Fiscal year 2005 appropriation........................      $455,130,000
Fiscal year 2006 budget request.......................       607,100,000
Committee recommendation in the bill..................       607,100,000
Comparison with:
    Fiscal year 2005 appropriation....................       151,970,000
    Fiscal year 2006 budget request...................  ................

    The construction, major projects appropriation provides for 
constructing, altering, extending, and improving any of the 
facilities under the jurisdiction or for the use of the VA, 
including planning, architectural and engineering services, 
Capital Asset Realignment Enhanced Services (CARES) activities, 
assessments and site acquisition where the estimated cost of a 
project is $7,000,000 or more. Emphasis is placed on correction 
of life/safety code deficiencies in existing Department medical 
facilities.
    The Committee recommends $607,100,000 for construction, 
major projects, the same as the budget request and $151,970,000 
more than the fiscal year 2005 appropriation.
    San Juan Medical Facilities.--The Committee is aware of the 
need for major medical facility improvements in San Juan, 
Puerto Rico and urges the Department to move forward in an 
expeditious manner. While the initial efforts at contracting 
for construction of a new bed tower encountered problems 
because bids exceeded funds available, the Committee 
understands that a new Step 1 Request for Proposal was issued 
on February 25, 2005 and the current schedule has a Step 2 
Request for Proposal to be issued on June 1, 2005. The goal of 
the Department is to award a design-build contract prior to 
September 30, 2005 using approximately $75,000,000 available to 
the Department for construction. The Committee is in complete 
agreement with this plan of action. In addition to this effort 
to provide a new bed tower, the Department is also engaged in a 
thorough evaluation of the seismic and safety upgrades to 
existing facilities in San Juan for which $15,000,000 has been 
appropriated. The Committee is concerned that such upgrades may 
prove to be rather expensive and directs the Department to 
evaluate the feasibility of building a replacement for the 
existing facility rather that merely following its current path 
of upgrading the facility and constructing a new administration 
building. The Department is to report to the Committee on the 
feasibility of such a plan no later than September 30, 2005.
    The specific amounts recommended by the Committee are as 
follows:

                        [In thousands of dollars]
------------------------------------------------------------------------
                                 Available
   Location and Description       through        2006        Committee
                                    2005       Request    Recommendation
------------------------------------------------------------------------
Veterans Health Administration
 (VHA):
    Cleveland, OH Cleveland-        $15,000      $87,300        $87,300
     Brecksville
     Consolidation, Phase 2...
    Pittsburgh, PA                   20,000       82,500         82,500
     Consolidation of
     Campuses, Phase 2........
    Las Vegas, NV New Medical        60,000      199,000        199,000
     Facility, Phase 2........
    Gainesville, FL Correct           8,800       76,400         76,400
     Patient Privacy
     Deficiencies, Phase 2....
    Anchorage, AK Outpatient         11,760       63,510         63,510
     Clinic and Regional
     Office, Phase 2..........
    Biloxi, MS Consolidation--            0       17,500         17,500
     Mental Health............
    Fayetteville, AR Clinical             0        5,800          5,800
     Addition.................
    Advance planning fund:               NA       28,290         28,290
     Various stations.........
    Asbestos abatement:                  NA        5,000          5,000
     Various stations.........
    Claims Analyses: Various             NA        3,000          3,000
     locations................
    Judgment Fund: Various               NA        2,500          2,500
     locations................
    Hazardous Waste: Various             NA        2,000          2,000
     locations................
    Facility Security Fund:              NA       15,000         15,000
     Various locations........
                               -----------------------------------------
      Total VHA construction,   ...........      587,800        587,800
       major projects.........
Less Proceeds and revenues      ...........      -48,000        -48,000
 from Lakeside, IL............
                               -----------------------------------------
      Total VHA...............  ...........      539,800        539,800
Veterans Benefits                                      0              0
 Administration (VBA).........
National Cemetery
 Administration (NCA): \1\
    Land Acquisition:                             41,000         41,000
     Bakersfield, Birmingham,
     Columbia/Greenville,
     Jacksonville, Sarasota
     County, South East
     Pennsylvania.............
    Fort Rosecrans Annex at                       19,450         19,450
     Miramar, CA Phase I
     Development..............
        Subtotal, Construction                  (60,450)       (60,450)
    Design Fund: Various                           3,850          3,850
     locations................
    Advance planning fund:                         1,000          1,000
     Various locations........
        Subtotal, Other line-                    (4,850)        (4,850)
         items................
          Total NCA             ...........       65,300         65,300
         construction, major
         projects.............
Staff Offices: Advanced         ...........        2,000          2,000
 Planning Activities at
 Various locations............
          Total construction,                   $607,100      $607,100
         major projects.......
------------------------------------------------------------------------
\1\ National Cemetery Administration major project requests do not
  include the purchase of pre-placed crypts, which are funded by the
  Compensation and Pensions appropriation.

                      CONSTRUCTION, MINOR PROJECTS

Fiscal year 2005 appropriation........................      $265,276,000
Fiscal year 2006 budget request.......................       208,937,000
Committee recommendation in the bill..................       208,937,000
Comparison with:
    Fiscal year 2005 appropriation....................      (56,339,000)
    Fiscal year 2006 budget request...................  ................

    The construction, minor projects appropriation provides for 
constructing, altering, extending, and improving any of the 
facilities under the jurisdiction or for the use of the 
Department, including planning, CARES activities, assessment of 
needs, architectural and engineering services, and site 
acquisition, where the estimated cost of a project is less than 
$7,000,000.
    The Committee recommends $208,937,000 for construction, 
minor projects, the same as the budget request and a decrease 
of $56,339,000 from the fiscal year 2005 appropriation.

       GRANTS FOR CONSTRUCTION OF STATE EXTENDED CARE FACILITIES

Fiscal year 2005 appropriation........................      $104,322,000
Fiscal year 2006 budget request.......................  ................
Committee recommendation in the bill..................        25,000,000
Comparison with:
    Fiscal year 2005 appropriation....................      (79,322,000)
    Fiscal year 2006 budget request...................        25,000,000

    This program provides grants to assist States to construct 
State home facilities, for furnishing domiciliary or nursing 
home care to veterans, and to expand, remodel or alter existing 
buildings for furnishing domiciliary, nursing home or hospital 
care to veterans in State homes. A grant may not exceed 65 
percent of the total cost of the project.
    The Committee recommends $25,000,000 for grants for life 
safety improvements to existing State home facilities. The 
Committee directs the Secretary to undertake a rigorous and 
extensive analysis of long-term care needs of veterans and 
report to the Congress no later than March 31, 2006 on the 
results of that study with recommendations for future funding 
needed to address all known life and safety deficiencies within 
existing State home facilities. This study is to be done with 
all interested stakeholders.

          GRANTS FOR CONSTRUCTION OF STATE VETERANS CEMETERIES

Fiscal year 2005 appropriation........................       $31,744,000
Fiscal year 2006 budget request.......................        32,000,000
Committee recommendation in the bill..................        32,000,000
Comparson with:
    Fiscal year 2005 appropriation....................           256,000
    Fiscal year 2006 budget request...................  ................

    This program provides grants to assist States with the 
establishment, expansion, and improvement of State veterans' 
cemeteries which are operated and permanently maintained by the 
States. Grants under this program fund up to 100 percent of 
construction costs and the initial equipment expenses when the 
cemetery is established.
    The states remain responsible for providing the land and 
for paying all costs related to the operation and maintenance 
of the state cemeteries, including the costs for subsequent 
equipment purchases. The Committee recommends the budget 
request of $32,000,000 for grants for construction of state 
veterans cemeteries, an increase of $256,000 when compared to 
the fiscal year 2005 appropriation.
    West Hawaii Veterans Cemetery.--The Committee is aware of 
the need for funding to complete Phase II of the West Hawaii 
Veterans Cemetery and encourages the Department to 
expeditiously evaluate any application for funding for this 
project.

                       ADMINISTRATIVE PROVISIONS

                     (INCLUDING TRANSFER OF FUNDS)

    The bill continues nineteen administrative provisions from 
title I, of division I of the Consolidated Appropriations Act, 
2005 (Public Law 108-447), with revised dollar figures and 
other conforming modifications. Two new administrative 
provisions are included in the bill.
    Section 201 allows for the transfer of funds among three 
mandatory appropriations.
    Section 202 allows for salaries and expenses funds to be 
used for hire of passenger vehicles, lease of facilities or 
land, and purchase of uniforms.
    Section 203 provides that only funding in the 
``Construction, major projects'' and ``Construction, minor 
projects'' accounts can be used for the purchase of any site 
for any new hospital or home or to construct any new hospital 
or home.
    Section 204 requires the Department to be reimbursed for 
medical services it provides to any person not defined as a 
beneficiary to ensure the Department is receiving payment for 
all medical services provided.
    Section 205 allows for the use of funds appropriated in 
fiscal year 2006 for ``Compensation and pensions'', 
``Readjustment benefits'', and ``Veterans insurance and 
indemnities'' for payment of accrued obligations recorded in 
the last quarter of fiscal year 2005.
    Section 206 allows for the use of fiscal year 2006 funds to 
pay prior year obligations resulting from implementation of 
sections 3328(a), 3334, and 3712(a) of title 31, United States 
Code.
    Section 207 enables the Department to use surplus earning 
from the National service life insurance, U.S. Government life 
insurance, and veterans special life insurance program to 
administer these programs. The Department estimates that 
$40,928,000 will be reimbursed to the ``General operating 
expenses'' account as a result of the provision.
    Section 208 allows for the continuation of the Franchise 
Fund for the Department of Veterans Affairs during fiscal year 
2006.
    Section 209 allows the Department to cover the 
administrative expenses of structuring enhanced-use leasing 
proposals and provides authority to obligate these 
reimbursements in the year funds are received.
    Section 210 limits the amount of reimbursement the Office 
of Resolution Management and the Office of Employment 
Discrimination Complaint Adjudication can charge other offices 
and accounts of the Department for services provided.
    Section 211 requires the Secretary to submit a report to 
the Committees on Appropriations to approve new leases of real 
property more than $300,000.
    Section 212 requires the Department to collect current, 
accurate third-party reimbursement information for the purposes 
of third-party insurance collections. If persons receiving care 
or medical services do not disclose this information, VA is 
allowed to bill them reasonable charges for services provided.
    Section 213 prohibits the Department from using any funds 
for establishment of medical emergency preparedness centers as 
defined in Public Law 107-287 or Public Law 108-422.
    Section 214 allows the Department to use enhanced-use 
leasing funds for construction and alterations for medical 
facilities to facilitate the CARES efforts as the Department 
restructures the delivery of healthcare to veterans.
    Section 215 allows the Department to use the ``Medical 
services'' appropriation for expenses related to the broader 
mission of medical care to veterans.
    Section 216 allows the Department to transfer Medical Care 
Collections to the ``Medical services'' appropriation to be 
used for veterans' medical care.
    Section 217 allows the Department to transfer funding 
between the three medical care appropriations with a limitation 
on transfers of 20 percent in fiscal year 2006 to implement the 
three-account structure which was directed by Congress in 
fiscal year 2004.
    Section 218 allows for the use of funds designated for the 
Veterans Benefit Administration to be used for a nationwide 
property management contract if the value of that contract 
exceeds $8,800,000 in any budget year.
    Section 219 allows veterans who reside in Alaska to obtain 
medical services from medical facilities supported by the 
Indian Health Services or tribal organizations, and provides 
for reimbursement for those services from the Department of 
Veterans Affairs.
    Section 220 allows the Department to transfer the proceeds 
received from the transfer of real property deposited into the 
Department of Veterans Affairs Capital Asset Fund (CAF) to the 
major and minor construction appropriations.
    Section 221 prohibits the expenditure of any funds 
available to the Department on implementation of a national 
standardized contract for diabetes monitoring systems.

                               TITLE III


                            RELATED AGENCIES


                  American Battle Monuments Commission


                         SALARIES AND EXPENSES

Fiscal year 2005 appropriation........................       $40,771,000
Fiscal year 2006 budget request.......................        35,250,000
Committee recommendation in the bill..................        35,750,000
Comparsion with:
    Fiscal year 2005 appropriation....................       (5,021,000)
    Fiscal year 2006 budget request...................           500,000

    The American Battle Monuments Commission is responsible for 
the administration, operation and maintenance of cemetery and 
war memorials to commemorate the achievements and sacrifices of 
the American Armed Forces where they have served since April 6, 
1917. In performing these functions, the Commission maintains 
twenty-four permanent American military cemetery memorials and 
thirty-one monuments, memorials, markers and offices in fifteen 
foreign countries, the Commonwealth of the Northern Mariana 
Islands, and the British dependency of Gibraltar. In addition, 
six memorials are located in the United States: the East Coast 
Memorial in New York; the West Coast Memorial, The Presidio in 
San Francisco; the Honolulu Memorial in the National Memorial 
Cemetery of the Pacific in Honolulu, Hawaii; and the American 
Expeditionary Forces Memorial and the World War II and Korean 
War Veterans Memorials in Washington, D.C.
    The Committee recommends an appropriation of $35,750,000 
for the American Battle Monuments Commission's fiscal year 2006 
salaries and expenses account. This is a decrease of $5,021,000 
below the fiscal year 2005 enacted level and an increase of 
$500,000 above the budget request. The increase in funding is 
to be used to have a study conducted to determine what, if any, 
action is warranted to preserve the stability of the site of 
the World War II Pointe du Hoc Ranger Monument located near the 
Normandy American Cemetery in France.
    The recommendation includes $3,100,000 for the cost to 
complete construction of the Normandy Interpretive Center at 
the Normandy American Cemetery in France, the full amount 
requested. The cemetery averages nearly two million visitors 
per year, and the existing facilities are over 40 years old and 
inadequate to serve this large number of visitors. The new and 
expanded center will provide a fuller array of interpretive 
services to put the D-Day landings and the following battles in 
Europe in perspective as one of the greatest military 
achievements of all time.
    While the Commission was responsible for overseeing the 
planning and construction of the World War II Memorial in 
Washington, D.C., the responsibility for operation and 
maintenance of the Memorial passed to the National Park Service 
when it was dedicated. The Commission, however, retains a 
fiduciary role in overseeing the remainder of funding donated 
by the public for construction of the Memorial. The Commission 
is directed to report annually to the Committee on the 
financial position of the fund including any expenditures 
during the prior year.
    Language is included allowing up to $7,500 to be used for 
official reception and representation expenses.

                  FOREIGN CURRENCY FLUCTUATION ACCOUNT

Fiscal year 2005 appropriation........................       $11,904,000
Fiscal year 2006 budget request.......................        15,250,000
Committee recommendation in the bill..................        15,250,000
Comparison with:
    Fiscal year 2005 appropriation....................         3,346,000
    Fiscal year 2006 budget request...................  ................

    The Commission's foreign currency fluctuations account is 
authorized pursuant to 36 U.S.C. 2109 to pay the costs of 
salaries and expenses that exceed the amount appropriated for 
salaries and expenses because of fluctuations in currency 
exchange rates of foreign countries occurring after a budget 
request for the Commission is submitted to the Congress. The 
account may not be used for any other purpose.
    The Committee recommends an appropriation of $15,250,000 to 
re-capitalize the Commission's Foreign Currency Fluctuations 
account. This is an increase of $3,346,000 above the fiscal 
year 2005 enacted level and the same as the budget request. Due 
to declining exchange rates during prior years, all available 
resources in the account have been depleted and necessary 
Commission activities have been deferred. Current estimates of 
exchange rates during fiscal year 2006 indicate that the 
Commission's budget submission will be insufficient to support 
Commission activities. Re-capitalization of the account ensures 
that funds are available to offset dollar losses during fiscal 
year 2006.

           United States Court of Appeals for Veterans Claims


                         SALARIES AND EXPENSES

Fiscal year 2005 appropriation........................       $17,112,000
Fiscal year 2006 budget request.......................        18,295,000
Committee recommendation in the bill..................        18,295,000
Comparison with:
    Fiscal year 2005 appropriation....................         1,183,000
    Fiscal year 2006 budget request...................  ................

    The Veterans' Judicial Review Act established the Court of 
Appeals for Veterans Claims. The Court reviews appeals from 
Department of Veterans Affairs claimants seeking review of a 
benefit denial. The Court has the authority to overturn 
findings of fact, regulations and interpretations of law.
    The Committee recommends an appropriation of $18,295,000 
for the Court of Appeals for Veterans Claims for fiscal year 
2006. This is an increase of $1,183,000 above the fiscal year 
2005 enacted level and the same as the budget request.
    The bill also identifies $1,260,000 to be used for the pro 
bono representation program, the same as proposed in the budget 
request.
    The Committee is pleased that the Court has moved forward 
in a responsible manner to assess its facility needs and looks 
forward to working with the Court to ensure that the most cost-
effective solution is selected.

                      Department of Defense--Civil


                       Cemeterial Expenses, Army


                         SALARIES AND EXPENSES

Fiscal year 2005 appropriation........................       $29,363,000
Fiscal year 2006 budget request.......................        28,050,000
Committee recommendation in the bill..................        29,550,000
Comparison with:
    Fiscal year 2005 appropriation....................           187,000
    Fiscal year 2006 budget request...................         1,500,000

    The Secretary of the Army is responsible for the 
administration, operation and maintenance of Arlington National 
Cemetery and the Soldiers' and Airmen's Home National Cemetery. 
In addition to its principal function as a national cemetery, 
Arlington is the site of approximately 3,100 non-funeral 
ceremonies each year and has approximately 4,000,000 visitors 
annually.
    The Committee recommends an appropriations of $29,550,000 
for operations and maintenance for fiscal year 2006. This is an 
increase of $187,000 above the fiscal year 2005 enacted level 
and an increase of $1,500,000 above the budget request.
    The Committee recommends that at least $1,500,000 in fiscal 
year 2006 be used for the Arlington Cemetery's automation 
project. The Committee is concerned about the need for physical 
security of existing ``hard copy'' records and recommends that 
the additional funds first be used to accelerate data entry of 
these records into the automation system. A priority should 
also be placed on providing for the physical security of the 
records. The Committee remains supportive of the automation 
effort, but continues to be concerned that detailed information 
on the overall project plan, cost, and schedule needs to be 
refined to allow for responsible decision-making. The Army is 
directed to update the report provided to the Committee earlier 
this year and include more detailed cost estimates for the 
total project as well as costs for key components which may be 
procured on a stand-alone basis.

                      Armed Forces Retirement Home


Fiscal year 2005 appropriation........................       $61,131,000
Fiscal year 2006 budget request.......................        58,281,000
Committee recommendation in the bill..................        58,281,000
Comparison with:
    Fiscal year 2005 appropriation....................       (2,850,000)
    Fiscal year 2006 budget request...................  ................

    The Armed Forces Retirement Home consists of two retirement 
communities, one in Washington, D.C. and the other in Gulfport, 
Mississippi. The Washington, D.C. facility was established in 
1851 as a soldiers' home for old and disabled veterans. The 
original home for Navy officers, sailors, and Marines was 
established in Philadelphia, Pennsylvania in 1811, and was 
relocated to Gulfport, Mississippi almost a century and a half 
later. The AFRH is home to 1,600 veterans and provides 
residential, social, and health services.
    The Committee recommendation provides authority to expend 
$58,281,000 from the Armed Forces Retirement Home Trust Fund 
for operations and capital activities at the United States 
Soldiers' and Airmen's Home and the United States Naval Home. 
This is a decrease of $2,850,000 below the comparable fiscal 
year 2005 appropriation and the same as the budget request.
    The bill provides authority to expend $57,033,000 from the 
Armed Forces Retirement Home Trust Fund for operations of the 
United States Soldiers' and Airmen's Home and the United States 
Naval Home as proposed in the budget request.
    The bill provides authority to expend $1,248,000 from the 
Armed Forces Retirement Home Trust Fund for capital activities 
at the Soldiers' and Airmen's Home and the United States Naval 
Home, a decrease of $2,720,000 below the comparable fiscal year 
2005 appropriation and the same as the budget request.

                                TITLE IV


                           GENERAL PROVISIONS

    Section 401 prohibits the obligation of funds beyond the 
current fiscal year unless expressly so provided.
    Section 402 limits the amount that can be paid for 
consultants.
    Section 403 requires pay raises to be absorbed within the 
levels appropriated.
    Section 404 prohibits the use of funds for programs, 
projects or activities not in compliance with Federal law 
relating to risk assessment, the protection of private property 
rights, or unfunded mandates.
    Section 405 prohibits the use of funds to support or defeat 
legislation pending before Congress.
    Section 406 encourages the expansion of E-Commerce 
technologies and procedures.
    Section 407 limits funds from being transferred from this 
appropriations measure to any instrumentality of the United 
States Government without authority from an appropriation Act.
    Section 408 specifies the congressional committees that are 
to receive all reports and notifications.

              House of Representatives Report Requirements

    The following items are included in accordance with various 
requirements of the rules of the House of Representatives.

                 Changes in Application of Existing Law

    Pursuant to clause 3(f)(1) of rule XIII of the Rules of the 
House of Representatives, the following statements are 
submitted describing the effect of provisions in the 
accompanying bill that directly or indirectly change the 
application of existing law.
    Language is included in various parts of the bill to 
continue on-going activities that require annual authorization 
or additional legislation, which to date have not been enacted.
    The bill includes a number of provisions which place 
limitations on the use of funds in the bill or change existing 
limitations and which might, under some circumstances, be 
construed as changing the application of existing law.
    Language is included that enables various appropriations to 
remain available for more than one year for some programs for 
which the basic authority legislation does not presently 
authorize such extended availability.
    Language is included in various parts of the bill which 
permits the transfer of funds to other accounts in the bill.
    Language is included under the Department of Veterans 
Affairs, General Operating Expenses, providing for the 
reimbursement to the Department of Defense for the costs of 
overseas employee mail. This language has been carried 
previously and permits free mailing privileges for personnel 
stationed in the Philippines.
    Language is included under the Department of Veterans 
Affairs, Construction, Major Projects, establishing time 
limitations and reporting requirements concerning the 
obligation of major construction funds, limiting the use of 
funds, and allowing the use of funds for program costs.
    Language is included under the Department of Veterans 
Affairs, Construction, Major Projects, providing that 
unobligated balances of previous appropriations may be used for 
any project with an estimated cost of less than $4,000,000, 
allowing the use of funds for program costs, and making funds 
available for damage caused by natural disasters.
    Language is included under the Department of Veterans 
Affairs, Administrative Provisions, permitting transfers 
between mandatory and discretionary accounts, limiting and 
providing for the use of certain funds, funding administrative 
expenses associated with VA life insurance programs from excess 
program revenues, extending authority to operate the Franchise 
Fund, allowing reimbursement from enhanced-use leases, allowing 
for reimbursement for certain services, requiring notification 
of new lease agreements, requiring disclosure of insurance and 
income information, prohibiting funds for implementation of two 
sections of Public Law 107-287 or section 303 of Public Law 
108-422, allowing the Secretary to establish a priority system 
for medical services, allowing a recovery audit collection 
program, and allowing medical services funds for recreational 
and funeral expenses.
    Language is included under the Court of Appeals for 
Veterans Claims, Salaries and Expenses, permitting the use of 
funds for a pro bono program.
    Language is included under Cemeterial Expenses, Army, 
Salaries and Expenses, permitting the use of funds for parking 
maintenance and repairs.
    Language is included in the Defense Health Program which 
places a limitation on the amount of funding available for 
contracts entered into under the TRICARE Program.
    Language is included in the Defense Health Program which 
makes available funds for HIV prevention educational 
activities.

                  Appropriations Not Authorized by Law

    Pursuant to clause 3(f)(1) of rule XIII of the Rules of the 
House of Representatives, the following table lists the 
appropriations in the accompanying bill which are not 
authorized by law:


                           Transfer of Funds

    Pursuant to clause 3(f)(2) of rule XIII of the Rules of the 
House of Representatives, a statement is required describing 
the transfer of funds provided in the accompanying bill.
    Language under ``Military Construction, Defense-wide'', 
``Environmental Restoration, Army'', ``Environmental 
Restoration, Navy'', ``Environmental Restoration, Air Force'', 
``Environmental Restoration, Defense-wide'', Environmental 
Restoration, Formerly Used Defense Sites'', and sections 115, 
119, 120, 123, 128 of Administrative Provisions, provide 
certain transfer authority.
    The Committee has included language transferring not to 
exceed $23,491,000 from Compensation and Pensions to General 
Operating Expenses and Medical Services. These funds are for 
the administrative costs of implementing cost-savings proposals 
required by the Omnibus Budget Reconciliation Act of 1990 and 
the Veterans' Benefits Act of 1992. Language is also included 
permitting necessary sums to be transferred to the medical 
facilities revolving fund to augment funding of medical centers 
for nursing home care provided to pensioners as authorized by 
the Veterans' Benefits Act of 1992.
    The Committee recommends transferring the following amounts 
to the Department of Veterans Affairs General Operating 
Expenses appropriation pursuant to the Federal Credit Reform 
Act of 1990: the Veterans Housing Benefit Program Fund Program 
Account ($153,575,000), the Vocational Rehabilitation Loans 
Program Account ($305,000) and the Native American Veteran 
Housing Loan Program Account ($5,718,000). In addition, the 
bill provides up to $750,000 in General Operating Expenses and 
Medical Services for administration of the Guaranteed 
Transitional Housing Loans for Homeless Veterans Program 
Account.
    The Committee has included language under the Department of 
Veterans Affairs that would transfer no less than $15,000,000 
for the DoD/VA Health Care Sharing Incentive Fund as authorized 
under section 721 of Public Law 107-317.
    The Committee recommends providing authority for the 
Department of Veterans Affairs for any funds appropriated in 
2006 for Compensation and Pensions, Readjustment Benefits, and 
Veterans Insurance and Indemnities to be transferred between 
those three accounts. This will provide the Department of 
Veterans Affairs flexibility in administering its entitlement 
programs.
    The Committee has included language permitting the funds 
from three life insurance funds to be transferred to General 
Operating Expenses for the costs of administering such 
programs.
    The Committee recommends language permitting up to 
$32,817,000 to be transferred to General Operating Expenses 
from any funds appropriated in 2006 to reimburse the Office of 
Resolution Management and the Office of Employment 
Discrimination Complaint Adjudication for services provided.
    The Committee has included language that would transfer 
certain funds derived from enhanced-use leasing activities to 
the Construction, Major Projects and Construction, Minor 
Projects Accounts.
    The Committee has included languge under the Department of 
Veterans Affairs that would transfer funds from the Medical 
Care Collections Fund to Medical Services.
    The Committee recommends providing authority for the 
Department of Veterans Affairs to transfer amounts between the 
Medical Services, Medical Administration and Medical Facilities 
accounts to the extent necessary to implement the restructuring 
of these accounts subject to certain notification requirements.
    The Committee recommends language under the Department of 
Veterans Affairs that would allow the transfer of funds from 
the General Operating Expenses account to the Veterans Housing 
Benefit Program Fund Program Account for certain purposes.
    The Committee recommends language under the Department of 
Veterans Affairs that would allow the transfer of funds from 
the Capital Asset Fund to the Construction, Major Projects and 
Construction, Minor Projects accounts.

                        Constitutional Authority

    Clause 3(d)(1) of rule XIII of the Rules of the House of 
Representatives states that:

          Each report of a committee on a bill or joint 
        resolution of a public character shall include a 
        statement citing the specific powers granted to the 
        Congress in the Constitution to enact the law proposed 
        by the bill or joint resolution.

    The Committee on Appropriations bases its authority to 
report this legislation from Clause 7 of Section 9 of Article I 
of the Constitution of the United States of America which 
states:

          No money shall be drawn from the Treasury but in 
        consequence of Appropriations made by law * * *

    Appropriations contained in this bill are made pursuant to 
this specific power granted by the Constitution.

                   Comparisons With Budget Resolution

    Clause 3(c)(2) of rule XIII of the Rules of the House of 
Representatives requires an explanation of compliance with 
section 308(a)(1)(A) of the Congressional Budget and 
Impoundment Control Act of 1974 (Public Law 93-344), as 
amended, which requires that the report accompanying a bill 
providing new budget authority contain a statement detailing 
how that authority compares with the reports submitted under 
section 302 of the Act for the most recently agreed to 
concurrent resolution on the budget for the fiscal year from 
the Committee's section of 302(a) allocation.

                                            [In millions of dollars]
----------------------------------------------------------------------------------------------------------------
                                                                  302(b) allocation             This bill
                                                             ---------------------------------------------------
                                                                 Budget                    Budget
                                                               authority     Outlays     authority     Outlays
----------------------------------------------------------------------------------------------------------------
Discretionary...............................................       85,158       81,634       85,158       81,634
Mandatory...................................................       35,640       35,570       35,640       35,570
----------------------------------------------------------------------------------------------------------------

                    Five-Year Projection of Outlays

    In compliance with section 308(a)(1)(B) of the 
Congressional Budget and Impoundment Control Act of 1974 
(Public Law 93-344), as amended, the following table contains 
five-year projections associated with the budget authority 
provided in the accompanying bill:

                        [In millions of dollars]
Outlays:
    2006..............................................            98,519
    2007..............................................            14,899
    2008..............................................             5,057
    2009..............................................             1,715
    2010 and beyond...................................             1,035

    The bill will not affect the levels of revenues, tax 
expenditures, direct loan obligations, or primary loan 
guarantee commitments under existing law.

          Financial Assistance to State and Local Governments

    In accordance with section 308(a)(1)(C) of the 
Congressional Budget and Impoundment Control Act of 1974 
(Public Law 93-344), as amended, the financial assistance to 
State and local governments is as follows:

                        [In millions of dollars]
New budget authority..................................               520
Fiscal year 2006 outlays resulting therefrom..........               403

         Statement of General Performance Goals and Objectives

    Pursuant to clause 3(c)(4) of rule XIII of the Rules of the 
House of Representatives, the following is a statement of 
general performance goals and objectives for which this measure 
authorizes funding:
    The Committee on Appropriations considers program 
performance, including a program's success in developing and 
attaining outcome-related goals and objectives, in developing 
funding recommendations.
                          Full Committee Votes

    Pursuant to the provisions of clause 3(b) of rule XIII of 
the House of Representatives, the results of each rollcall vote 
on an amendment or on the motion to report, together with the 
names of those voting for and those voting against, are printed 
below:

                           ROLLCALL NUMBER: 1

    Date: May 18, 2005.
    Measure: Military Quality of Life and Veterans Affairs 
Appropriations Bill, FY 2006.
    Motion by: Mr. Obey.
    Description of motion: To increase certain veterans 
programs by $2,605,000,000, offset by a reduction to tax cuts 
for certain income groups.
    Results: Rejected 27 yeas to 34 nays.
        Members Voting Yea            Members Voting Nay
Mr. Berry                           Mr. Aderholt
Mr. Bishop                          Mr. Alexander
Mr. Boyd                            Mr. Bonilla
Mr. Clyburn                         Mr. Carter
Mr. Cramer                          Mr. Crenshaw
Ms. DeLauro                         Mr. Culberson
Mr. Dicks                           Mr. Cunningham
Mr. Edwards                         Mr. Doolittle
Mr. Farr                            Mrs Emerson
Mr. Fattah                          Mr. Frelinghuysen
Mr. Hinchey                         Mr. Goode
Mr. Jackson                         Ms. Granger
Ms. Kaptur                          Mr. Hobson
Mr. Kennedy                         Mr. Istook
Mrs. Lowey                          Mr. Kingston
Mr. Mollohan                        Mr. Kirk
Mr. Moran                           Mr. Knollenberg
Mr. Murtha                          Mr. Kolbe
Mr. Obey                            Mr. LaHood
Mr. Olver                           Mr. Latham
Mr. Pastor                          Mr. Lewis
Mr. Price                           Mrs. Northup
Mr. Rothman                         Mr. Peterson
Ms. Roybal-Allard                   Mr. Regula
Mr. Sabo                            Mr. Rehberg
Mr. Serrano                         Mr. Rogers
Mr. Visclosky                       Mr. Sherwood
                                    Mr. Simpson
                                    Mr. Taylor
                                    Mr. Walsh
                                    Mr. Wamp
                                    Dr. Weldon
                                    Mr. Wolf
                                    Mr. Young
                               State List

    The following is a complete listing, by State and country, 
of the Committee's recommendations for military construction 
and family housing projects: 



              ADDITIONAL VIEWS OF THE HONORABLE DAVID OBEY

    While the FY 2006 Military Quality of Life and Veterans 
Affairs bill is a much-needed improvement over the President's 
inadequate budget for veterans health care, this bill will not 
get the job done for the men and women who are depending on the 
VA to meet their health care needs.
    I presented to the Majority a very simple amendment: 
provide veterans with an additional $2.6 billion for VA health 
care and pay for it by reducing the size of the tax cut for 
those persons who make more than a million dollars a year. 
Instead of receiving a tax cut of $140,000, people making over 
one million dollars this year would get $129,000.
    This is an issue of shared sacrifice. I think it is 
completely appropriate for the most well off in our society to 
take a slightly smaller tax break so we can provide health care 
for the men and women who have fought, sacrificed, and risked 
life and limb to protect the freedoms we all enjoy.
    Under mendment, veterans would get:
           $1.5 billion more for medical services to 
        meet increased demand;
           $500 million to meet rising medical 
        administrative costs;
           $300 million to keep VA medical facilities 
        up and running;
           $67 million for VA medical and prosthetic 
        research;
           $201 million to build medical clinics and 
        long-term care facilities;
           $37 million for general administrative costs 
        so veterans receive the prompt attention.
    Why are these increases needed? The number of veterans 
treated at VA facilities increased from 2.7 million to 4.7 
million from 1995 to 2004. Medical costs are increasing at 
nearly double the rate of inflation. VA facilities are old and 
crumbling and improvements will cost at least $1 billion a year 
for the next ten years according to the VA itself. 
Unfortunately, the Committee rejected my amendment.
    I have heard some on the majority side say, `enough is 
never enough for you guys on veteran's health care.' Enough 
will be enough when every veteran receives the timely and high 
quality health care that they were promised. I did not serve in 
the military, but I believe we have a moral obligation when it 
comes to veterans' health care. If in America we cannot provide 
health care to 45 million Americans who are without any 
coverage, we ought to at least be providing top-shelf, top-
quality, no questions asked medical care to veterans who have 
risked more than anybody else in this society to keep it as 
free and open as it is today.
    We also have a moral obligation to point out at every 
opportunity that the reason why veterans will not be receiving 
the health care they deserve is because of the misbegotten, 
ill-advised budget that the Republican Congress passed just a 
few short weeks ago. That budget, which only one Republican 
member of the Appropriations Committee opposed, is the reason 
that veterans will not receive the health care that they were 
promised and that they deserve.

                                  
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