[Senate Report 109-35]
[From the U.S. Government Publishing Office]



                                [ERRATA]

                                                        Calendar No. 48
109th Congress                                                   Report
                                 SENATE
 1st Session                                                     109-35

======================================================================



 
            [ERRATA] FOREIGN AFFAIRS AUTHORIZATION ACT,
                       FISCAL YEARS 2006 AND 2007

                                _______
                                

                 March 10, 2005.--Ordered to be printed

                                _______
                                

          Mr. Lugar, from the Committee on Foreign Relations,
                        submitted the following

                                 REPORT

                         [To accompany S. 600]


    The Committee on Foreign Relations, having had under 
consideration an original bill (S. 600) to authorize 
appropriations for the Department of State and international 
broadcasting activities for fiscal years 2006 and 2007, for the 
Peace Corps for fiscal years 2006 and 2007, for foreign 
assistance programs for fiscal years 2006 and 2007, and for 
other purposes, reports favorably thereon with amendments and 
recommends that the bill as amended do pass.




                                 ERRATA

    This errata contains the Congressional Budget Office's Cost 
Estimate which was not available when the report was originally 
filed.
    In addition, this errata contains a revision to the table 
on page 25 of the original report (V. Division B--Foreign 
Assistance Authorization Act, Fiscal Year 2006--(A) Summary of 
Funds). That table incorrectly stated that dollar amounts 
within the table were expressed in thousands of dollars. The 
dollar amounts within the table are expressed in millions of 
dollars. This errata contains the corrected table.





                                CONTENTS

                               ----------                              
                                                                   Page

Cost Estimate
    Congressional Budget Office Cost Estimate for the Foreign 
      Affairs Authorization Act, Fiscal Years 2006 and 2007......     1

Division B--Foreign Assistance Authorization Act, Fiscal Year 
  2006
    (A) Summary of Funds.........................................    12

                                 (iii)



   Congressional Budget Office Cost Estimate for the Foreign Affairs 
             Authorization Act, Fiscal Years 2006 and 2007

                             Cost Estimate

    In accordance with rule XXVI, paragraph 11(a) of the 
Standing Rules of the Senate, the committee provides the 
following estimate of the cost of this legislation prepared by 
the Congressional Budget Office.
                            United States Congress,
                               Congressional Budget Office,
                                    Washington, DC, March 18, 2005.

Hon. Richard G. Lugar, Chairman
Committee on Foreign Relations,
United States Senate,
Washington, DC.

    Dear Mr. Chairman:

    The Congressional Budget Office has prepared the enclosed 
cost estimate for S. 600, the Foreign Affairs Authorization 
Act, Fiscal Years 2006 and 2007.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Sunita 
D'Monte.

            Sincerely,
                              Douglas Holtz-Eakin, Director

    Enclosure.

cc: Hon. Joseph R. Biden, Jr., Ranking Minority Member

                      CONGRESSIONAL BUDGET OFFICE
                             COST ESTIMATE


               S. 600--Foreign Affairs Authorization Act,
                       Fiscal Years 2006 and 2007


 As reported by the Senate Committee on Foreign Relations on March 10, 
                                  2005

                                SUMMARY

    S. 600 would authorize appropriations of almost $30 billion 
in 2006 and such sums as may be necessary in 2007 for the 
Department of State, international assistance programs, and 
related agencies. The bill also contains provisions that would 
raise the cost of discretionary programs for famine and 
reconstruction assistance, debt relief, public diplomacy, 
personnel, and other programs over the 2007-2010 period. CBO 
estimates that those provisions and the indefinite 
authorizations for 2007 would require appropriations of $34 
billion over those four years. CBO estimates that implementing 
the bill would cost about $59 billion over the 2006-2010 
period, assuming the appropriation of the necessary amounts.
    CBO estimates that S. 600 would raise direct spending by 
$33 million in 2006 and by $87 million over the 2006-2015 
period. S. 600 also would increase governmental receipts (i.e., 
revenues) by an insignificant amount each year by creating new 
criminal penalties related to law enforcement and protective 
functions of State Department special agents and guards. 
Finally, the Joint Committee on Taxation estimates that the 
bill would lower revenues by less than $500,000 a year by 
exempting employees of the U.S. Mission to the United Nations 
in New York City from paying taxes on their housing allowance.
    S. 600 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would not affect the budgets of state, local, or tribal 
governments.

                ESTIMATED COST TO THE FEDERAL GOVERNMENT

    The estimated budgetary impact of S. 600 is shown in Table 
1. The costs of this legislation fall within budget functions 
150 (international affairs), 300 (natural resources and 
environment), 600 (income security), 750 (administration of 
justice), and 800 (general government).

     TABLE 1. BUDGETARY IMPACT OF S. 600, THE FOREIGN AFFAIRS AUTHORIZATION ACT, FISCAL YEARS 2006 AND 2007
                                    (By fiscal year, in millions of dollars)
----------------------------------------------------------------------------------------------------------------
                                                   2005       2006       2007       2008       2009       2010
----------------------------------------------------------------------------------------------------------------
                                        SPENDING SUBJECT TO APPROPRIATION

Spending Under Current Law for State
 Department, International Assistance
 Programs, and Related Agencies:
    Estimated Authorization Level\1\\2\            27,264      2,564      2,604      2,655          0          0
    Estimated Outlays                              26,805     14,288      7,906      5,492      3,389      1,416

Proposed Changes:
    Estimated Authorization Level\3\                    0     29,872     30,748      1,035      1,133      1,226
    Estimated Outlays                                   0     14,690     22,904     11,664      5,994      3,666

Spending Under S. 2144 for State Department,
 International Assistance Programs, and
 Related Agencies:
    Estimated Authorization Level\2\\3\            27,264     32,436     33,352      3,690      1,133      1,226
    Estimated Outlays                              26,805     28,978     30,810     17,156      9,383      5,082

                                   CHANGES IN DIRECT SPENDING AND REVENUES\4\

Estimated Budget Authority                              0         81         21         21         21         21
Estimated Outlays                                       0         33         14         11         11         11

----------------------------------------------------------------------------------------------------------------
\1\The 2005 level is the amount appropriated for that year.
\2\The estimated authorization levels over the 2006-2008 period are for international HIV/AIDS programs
  authorized by Public Law 108-25, the U.S. Leadership Against HIV/AIDS, Tuberculosis, and Malaria Act of 2003
  for the Global HIV/AIDS Initiative and Child Survival and Disease and other programs. That act authorized the
  appropriation of $15 billion for the 2004-2008 period for HIV/AIDS programs, including programs administered
  by the Department of Health and Human Services.
\3\These amounts do not include costs for section 213 of the bill because CBO cannot estimate the timing or
  amounts that may be necessary to implement those provisions.
\4\In addition to the effects shown for direct spending, CBO estimates that provisions that would increase or
  decrease revenues would have a net effect of less than $500,000 each year over the 2006-2015 period.


                           BASIS OF ESTIMATE

    The bill would authorize appropriations for the Department 
of State and international broadcasting activities for fiscal 
years 2006 and 2007. It would be the first comprehensive 
foreign assistance authorization act since the mid-1980s--
authorizing funding for most existing assistance programs and 
also several new ones. The bill also would raise direct 
spending by $33 million in 2006 and by $87 million over the 
2006-2015 period. Finally, S. 600 would affect governmental 
receipts (revenues), but CBO estimates that the net effect 
would be less than $500,000 a year.

Spending Subject to Appropriation

    S. 600 would authorize appropriations at the specified 
level of $29.8 billion in 2006 and for such sums as may be 
necessary for 2007 for the State Department, international 
assistance programs, and related agencies. Of the 2006 amount, 
nearly $0.6 billion would be for HIV/AIDS programs that are 
currently authorized in existing law. The bill would authorize 
new programs that would affect costs for stabilization and 
reconstruction activities and assistance, safe water, debt 
relief, public diplomacy, personnel, and other programs. CBO 
estimates that implementing those provisions would require 
additional appropriations of $0.7 billion in 2006 and $4.4 
billion over the 2007-2010 period. For this estimate, CBO 
assumes that the authorized amounts will be appropriated near 
the start of each fiscal year and that outlays will follow 
historical spending patterns for the existing and similar 
programs.
    Specified Authorizations. The authorizations of 
appropriations in this bill cover the operating expenses and 
programs of the Department of State, the U.S. Agency for 
International Development, the Broadcasting Board of Governors 
(BBG), the Peace Corps, and the Millennium Challenge 
Corporation. The authorization levels for 2006 are equal to the 
President's request for international affairs spending.
    As shown in Table 2, S. 600 would authorize the 
appropriation of $10.3 billion for international development 
and humanitarian assistance programs--not counting HIV/AIDS 
programs, $8.3 billion for international security assistance 
programs, $9.2 billion for the State Department for programs 
related to the administration of foreign affairs, international 
organizations, and other associated programs, $1.2 billion for 
international broadcasting and exchange activities, and $0.1 
billion for international commissions. Except where otherwise 
discussed, CBO estimated authorizations for 2007 at the amount 
specified in 2006 adjusted for inflation.


 TABLE 2. ESTIMATED AUTHORIZATIONS IN S. 600, THE FOREIGN AFFAIRS AUTHORIZATION ACT, FISCAL YEARS 2006 AND 2007
----------------------------------------------------------------------------------------------------------------
                                                              By Fiscal Year, in Millions of Dollars
                                                ----------------------------------------------------------------
                                                     2006         2007         2008         2009         2010
----------------------------------------------------------------------------------------------------------------
                                Estimated Authorizations for Existing Programs\1\

  International Development and Humanitarian
   Assistance
    Estimated Authorization Level\2\                  10,344       10,518            0            0            0
    Estimated Outlays                                  2,930        6,780        5,673        2,750        1,257

  International Security Assistance
    Estimated Authorization Level                      8,348        8,491            0            0            0
    Estimated Outlays                                  4,890        6,742        2,606        1,251          657

  Conduct of Foreign Affairs
    Estimated Authorization Level                      9,237        9,436            0            0            0
    Estimated Outlays                                  5,904        7,820        2,356        1,051          737

  Foreign Information and Exchange Activities
    Estimated Authorization Level                      1,185        1,209            0            0            0
    Estimated Outlays                                    810        1,129          357           67           23

  Other Programs
    Estimated Authorization Level                         72           73            0            0            0
    Estimated Outlays                                     59           67           12            6            1

    Total Authorizations for Existing Programs
      Estimated Authorization Level                   29,186       29,727            0            0            0
      Estimated Outlays                               14,593       22,538       11,004        5,125        2,675

                              Estimated Authorizations for New or Expanded Programs

  Reconstruction & Stabilization Civilian
   Management Act of 2005
    Estimated Authorization Level                        124          127          128          131          134
    Estimated Outlays                                     57          111          124          128          131

  Famine and Reconstruction Assistance
    Estimated Authorization Level                        500          508          517          527          536
    Estimated Outlays                                     25          180          328          409          466

  Safe Water
    Estimated Authorization Level                         50          135          305          390          470
    Estimated Outlays                                      4           31           91          195          292

  Debt Relief for the Poorest
    Estimated Authorization Level                          0          155           75           75           75
    Estimated Outlays                                      0           15           84           92           83

  Office Building for American Institute in
   Taiwan
    Estimated Authorization Level                          0           78            0            0            0
    Estimated Outlays                                      0           12           23           35            8

  Personnel Benefits and Other Programs
    Estimated Authorization Level                          4           10           10           10           11
    Estimated Outlays                                      3            9           10           10           11

  Indefinite Authorizations for Currency
   Fluctuations
    Estimated Authorization Level                          8            8            0            0            0
    Estimated Outlays                                      8            8            0            0            0

      Total Estimated Authorizations
        Estimated Authorization Level                    686        1,021        1,035        1,133        1,226
        Estimated Outlays                                 97          366          660          869          991

          Total Authorizations
            Estimated Authorization Level             29,872       30,748        1,035        1,133        1,226
            Estimated Outlays                         14,690       22,904       11,664        5,994        3,666
----------------------------------------------------------------------------------------------------------------
\1\The estimated authorization for 2007 is the 2006 authorization level adjusted for inflation.
\2\The estimated authorization for 2006 does not include $1,970 million for the Global HIV/AIDS Initiative and
  $594 million for HIV/AIDS programs in Child Survival and Disease and other programs that are authorized by
  Public Law 108-25, the U.S. Leadership Against HIV/AIDS, Tuberculosis, and Malaria Act of 2003.


Reconstruction and Stabilization Civilian Management Act of 2005

    Title VII of the bill would authorize the President to 
provide assistance to stabilize and rebuild a country or region 
that is in, or emerging from, conflict or civil strife. The 
bill would authorize assistance to respond to international 
crises through a new emergency fund and it would establish an 
Office of Reconstruction and Stabilization within the 
Department of State to provide civilian management of 
stabilization and reconstruction efforts. The bill would 
authorize the appropriation of $24 million in 2006 and such 
sums as may be necessary in 2007 for personnel, education and 
training, equipment, and travel costs. It would authorize an 
initial appropriation of $100 million for the emergency fund 
plus a permanent, indefinite authorization of such sums as may 
be necessary to replenish funds expended. In addition, it would 
authorize the President to waive the percentage and aggregate 
dollar limitations in current law regarding various authorities 
to draw down or to transfer resources to respond to such 
crises.
    Office of Reconstruction and Stabilization. Section 706 
would authorize a new office within the Department of State 
with responsibility to monitor and assess international crises, 
to prepare contingency plans for various types of crises, to 
identify and train personnel with necessary skills for 
stabilization and reconstruction operations, and to coordinate 
the U.S. efforts should the President decide to respond to any 
crisis. The Office of Reconstruction and Stabilization was 
created in August 2004.
    The bill also would authorize the establishment of a 
response readiness corps with up to 250 members to staff the 
office and for deployment on short notice, plus a readiness 
reserve from current federal employees and up to 500 nonfederal 
personnel to support operations if needed. The costs of 
activating the corps would be paid from the emergency fund. 
Based on information from the State Department, CBO estimates 
that annual costs associated with the office and the response 
readiness corps would be $24 million, adjusted annually for 
inflation.
    Emergency Fund. Section 705 would authorize $100 million 
for an emergency stabilization and reconstruction fund. 
Considering the number of regions in the world in conflict or 
recovering from conflict and that appropriations for the 
reconstruction of Iraq and Afghanistan have totaled nearly $24 
billion over the 2003-2005 period, reconstruction could require 
much larger funding levels than the amount authorized. CBO 
estimates that the emergency fund would be used for an initial 
response to an international crisis and not for major 
reconstruction efforts which are discussed below. For this 
estimate, CBO assumes that the fund would be replenished--
through discretionary appropriations--on an annual basis at the 
$100 million level, adjusted for inflation, and that it would 
be used for a mix of activities with an aggregate spending 
pattern similar to the Economic Support Fund.

Famine and Reconstruction Assistance

    Section 2205 would expand the purposes for which 
appropriations for international disaster assistance may be 
provided to include programs of famine relief and 
reconstruction following manmade or natural disasters abroad. 
The bill would authorize the appropriation of $656 million in 
2006 for international disaster and famine assistance, but not 
reconstruction. Reconstruction following manmade or natural 
disasters can be very expensive and has often been funded by 
supplemental appropriations.
    This year the President is requesting supplemental 
appropriations of $0.7 billion for tsunami relief and 
reconstruction and nearly $2.0 billion for Afghanistan. Those 
amounts are in addition to $100 million enacted for Central 
America and the Caribbean to recover after disastrous 
hurricanes last fall. While it is impossible to estimate future 
funding levels on an annual basis, CBO estimates that meeting 
the expanded purposes could require appropriations of several 
hundred million dollars to one billion dollars above the level 
specified by the bill for countries emerging from natural 
disasters, conflict, or civil strife. For this estimate, based 
on historical funding for similar activities, CBO assumes the 
costs for implementing this section would total about $500 
million each year over the 2006-2010 period, assuming the 
appropriation of the necessary funds. Spending of such funding 
would likely occur over a period of years so that annual 
outlays would start well below that level, and grow gradually.

Safe Water

    Title XXVI would authorize the President to furnish 
assistance to improve the safety of water supplies in 
developing countries, to expand access to safe water and 
sanitation, and to promote sound water management. In addition 
to grant assistance to local governments and nongovernmental 
organizations, it would authorize the President to create a 
pilot program with the authority to issue investment insurance, 
investment guarantees, and loan guarantees; to provide direct 
investment or investment encouragement; and to carry out 
special projects and programs for eligible investors to assist 
in the development of safe drinking water and sanitation 
infrastructure. It would authorize the appropriation of such 
sums as may be necessary over the 2006-2011 period to carry out 
the title.
    The bill would, to the extent provided for in advance in 
appropriation acts, authorize the President to create such 
legal mechanisms as may be necessary for implementing the 
authorities under the pilot program and to deem such legal 
mechanisms to be nonfederal borrowers for purposes of the 
Federal Credit Reform Act. It would, notwithstanding any other 
provision of law, authorize the President to provide assistance 
under the pilot program in the form of partial loan guarantees 
of up to 75 percent of the total amount of the loan.
    It is unclear whether the pilot program would be entirely 
new or would be an augmentation of the existing credit programs 
of the U.S. Agency for International Development and Overseas 
Private Investment Corporation. It is also unclear whether this 
new program would create federal or nonfederal entities (legal 
mechanisms) or whether credit reform treatment would apply. 
However, it is clear that the bill would intend that resources 
devoted to providing safe water be increased. For the purpose 
of the estimate, CBO assumes the bill would double the 
assistance for safe water provided to Sub-Saharan Africa in 
2004, or an increase in 2006 of $50 million over the amounts 
otherwise authorized in the bill, and that amount would 
increase over the next five years to $470 million, or the 
amount spent in 2004 for water programs including those in 
Iraq. Because the cost recovery of water investments projects 
would be in local currencies, CBO assumes that investments 
relying on hard-currency credits would remain unattractive and 
would be little used.

Debt Relief for the Poorest

    Section 2114 would authorize the appropriation of $100 
million in 2006 for the cost, as defined by the Federal Credit 
Reform Act, of restructuring bilateral debts, for debt relief 
under the Tropical Forest Conservation Initiative, and for a 
contribution to the Heavily Indebted Poor Countries Trust Fund 
administered by the World Bank. In addition, section 2221 would 
authorize the President to reduce the U.S. bilateral debt of 
low-income countries as part of multilateral debt-relief 
agreements, commonly referred to as the Paris Club, limited to 
such extent or in such amounts as may be provided in advance in 
an appropriation act. That authorization is the same as the 
authorization contained in general provisions of annual 
appropriation acts for nearly a decade.
    The U.S. government has forgiven the bilateral debt that it 
once held for most of the world's poorest countries; however, 
it still holds the debt of some of the world's poorest 
countries such as the Democratic Republic of the Congo, 
Afghanistan, Sudan, Somalia, and Liberia. Congo has been 
offered multilateral debt relief by the Paris Club. At some 
point after 2006, the other poor countries may meet the minimum 
requirements for multilateral debt relief as stipulated by the 
bill. We cannot project the exact timing of such action, but 
given the experience of other countries emerging from internal 
conflict, we estimate that it would take at least two to three 
years after a reconstituted civilian government is established 
in those countries before any multilateral debt agreement would 
be negotiated. While the bill does not specifically authorize 
the appropriation of any funds, CBO estimates that the present 
value of all debt of low-income countries held by the U.S. 
government to be between $550 million and $600 million. CBO 
estimates that forgiving bilateral loans to Congo would cost 
about $235 million in 2007, an increase of $155 million over 
the amount authorized for 2006. CBO estimates that forgiving 
the bilateral loans to other poor countries would cost about 
$75 million a year over the 2008-2010 period, assuming 
appropriation of the necessary amounts.

Office Building for American Institute in Taiwan (AIT)

    Section 211 would amend current law to authorize such sums 
as may be necessary for the construction of a new office 
building for the AIT in Taipei, Taiwan. Public Law 106-212 
authorized the appropriation of $75 million for the facility 
without fiscal year limitation. According to the Department of 
State, the projected cost of the building is now $153 million, 
and roughly $20 million has been spent on site acquisition and 
design. CBO estimates a net increase in authorization of $78 
million and assumes that construction would begin in 2007 and 
end in 2010.

Personnel Benefits

    S. 600 contains several provisions that would provide 
benefits to State Department personnel that would increase 
costs by up to $10 million each year, assuming the 
appropriation of the necessary funds.
    Hardship and Danger Pay Allowances. Section 303 would 
increase the cap on hardship allowances and danger pay 
allowances from 25 percent to 35 percent of basic pay for 
employees serving overseas. Based on information from the 
Department of State, CBO estimates implementing this section 
would cost about $6 million a year, assuming the appropriation 
of the necessary funds.
    Educational Expenses of Dependent Children. Section 301 
would authorize payments for certain educational expenses of 
dependent children of Foreign Service employees posted 
overseas. Section 506 would allow the BBG to pay for the 
educational expenses of certain dependents of employees in the 
Commonwealth of the Northern Mariana Islands. Based on 
information from the Department of State and the BBG, CBO 
estimates implementing these provisions would cost about $3 
million annually.
    Housing for Employees. Section 318 would allow the 
department to provide housing to 10 more employees of the U.S. 
Mission to the United Nations in New York City. Based on 
information from the State Department, CBO estimates the 
additional housing would cost between $500,000 and $1 million a 
year, assuming the availability of appropriated funds.

Indefinite Authorizations for Currency Fluctuations

    Section 102(c) would authorize the appropriation of such 
sums as may be necessary in 2006 and 2007 to compensate for 
adverse fluctuations in exchange rates that might affect 
contributions to international organizations. Any funds 
appropriated for this purpose would be obligated and expended 
subject to certification by the Office of Management and 
Budget. CBO estimates that the dollar will decline roughly 2 
percent in 2006 and that the Department of State would require 
an additional $8 million that year to fully pay assessed 
contributions to international organizations. Currency 
fluctuations over the longer term are extremely difficult to 
project, and they could result in spending either higher or 
lower than the amounts specifically authorized in the bill for 
contributions to international organizations and programs. 
Therefore, this estimate assumes no additional currency 
fluctuations in 2007.

Miscellaneous Provisions

    S. 600 would authorize several new or expanded programs. In 
general, the bill would fund these programs through earmarks of 
funds otherwise authorized or the provisions would have an 
insignificant impact on spending subject to appropriation, CBO 
estimates.

   Section 213 would create a Victims of Crime Office 
        within the Department of State and authorize the 
        department to provide services and financial assistance 
        from its emergency fund to U.S. nationals who become 
        crime victims overseas. CBO cannot estimate the 
        budgetary impact of this provision given the 
        uncertainties associated with estimating how many 
        individuals may be victimized and whether victims of 
        terrorist acts would also be covered under this 
        provision.

   Title XXIII would authorize assistance to reduce the 
        threat to diplomatic missions abroad from an attack 
        using radioactive materials. In particular, it would 
        authorize assistance to foreign countries to develop 
        appropriate response plans and to train foreign 
        personnel who would be the first to respond to such an 
        attack. The bill would earmark $2 million from the 
        amount authorized elsewhere in the bill for 
        Nonproliferation, Anti-Terrorism, Demining and Related 
        (NADR) programs to fund these activities.

   Title XXIV would authorize a program of global 
        pathogen surveillance to assist in the monitoring and 
        response to bioterrorism and outbreaks of infectious 
        disease. The bill would earmark $35 million from the 
        amount authorized for NADR to fund these activities.

   Title XXVIII would authorize a program for 
        safeguarding and eliminating man- portable air-defense 
        systems and other conventional arms. It would earmark 
        $20 million from amounts otherwise authorized in the 
        bill.

   Section 2224 would authorize the Secretary to 
        designate a nonprofit organization as the Middle East 
        Foundation and to fund the organization through grants. 
        While the provision is silent on the level of funding, 
        the President is requesting $25 million for the 
        foundation.

   Section 2211 would authorize appropriations for 
        educating children in Afghanistan about the dangers of 
        land mines.

   The bill includes numerous provisions that would 
        expand or introduce new reporting requirements and 
        other provisions that would eliminate or consolidate 
        existing reporting requirements.

Direct Spending and Revenues

    CBO estimates that S. 600 would raise direct spending by 
$33 million in 2006 and by $87 million over the 2006-2015 
period (see Table 3). The bill also contains provisions that 
would increase and decrease governmental receipts (revenues), 
but CBO estimates that the net effect of these provisions would 
be less than $500,000 a year.


 TABLE 3. ESTIMATED DIRECT SPENDING AND REVENUES IN THE FOREIGN AFFAIRS AUTHORIZATION ACT, FISCAL YEARS 2006 AND
                                                      2007
                                    (By fiscal year, in millions of dollars)
----------------------------------------------------------------------------------------------------------------
                                      2005   2006   2007   2008   2009   2010   2011   2012   2013   2014   2015
----------------------------------------------------------------------------------------------------------------
Changes in Outlays                       0     33     14     11     11     11      3      1      1      1      1
Changes in Revenues                      0    (*)    (*)    (*)    (*)    (*)    (*)    (*)    (*)    (*)    (*)

----------------------------------------------------------------------------------------------------------------
Note: (*) = less than $500,000.


Buying Power Maintenance Account

    The State Department may maintain an approved level of 
program activity in the face of currency fluctuations through a 
Buying Power Maintenance Account. Under current law, the 
Secretary of State may transfer any current funds in excess of 
needs that result from an increase in the purchasing power of 
the dollar from accounts under ``Administration of Foreign 
Affairs'' to the Buying Power Maintenance Account. The funds in 
the account are available for transfer back to those accounts 
only to offset future adverse fluctuations in exchange rates or 
overseas wage or price levels. The Secretary may also transfer 
unavailable balances into the Buying Power Maintenance Account, 
but only to the extent and in such amounts as specifically 
provided in advance in appropriation acts. No appropriation act 
has ever provided that authority. Section 207 of the bill would 
strike the requirement for appropriation action, thus allowing 
the Secretary to transfer lapsed funds into the Buying Power 
Maintenance Account and making them available to offset future 
adverse currency fluctuations.
    According to the Treasury Combined Statement on Receipts, 
Outlays, and Balances, 2004, the Department of State had $80 
million in unobligated, unavailable balances in various 
accounts in the Administration of Foreign Affairs bureau at the 
start of 2005. Under the bill, such balances could be 
transferred into the Buying Power Maintenance account upon 
enactment and made available to meet adverse exchange rate 
fluctuations. In addition, CBO estimates approximately 0.5 
percent of obligated balances, or about $20 million, would be 
deobligated each year and reappropriated under the bill. 
Because we estimate the dollar will decline in value over the 
next year, we estimate that about half of the funds would be 
transferred out of the Buying Power Maintenance Account and 
spent. In total, we estimate direct spending of about $80 
million over the 2006-2015 period.

Medical Reimbursements

    Section 206 would provide the State Department greater 
flexibility in retaining reimbursements for funding medical 
care provided to employees and eligible family members 
overseas. Based on information from the department, CBO 
estimates that it would collect and spend between $500,000 and 
$1 million a year.

Other Provisions

    CBO estimates that several provisions in the bill would 
affect direct spending and revenues by less than $500,000 
annually.

   Section 318 would exempt, for federal income tax 
        purposes, housing allowances paid to employees of the 
        U.S. Mission to the United Nations in New York City. 
        The Joint Committee on Taxation estimates that the 
        provision would reduce tax receipts by less than 
        $500,000 each year, assuming it would be effective for 
        allowances paid on or after October 1, 2005.

   Sections 201 and 203 would raise governmental 
        receipts (revenues) by establishing new criminal 
        penalties that would be assessed against persons 
        interfering with the law enforcement and protective 
        functions of State Department special agents and 
        guards. CBO estimates that the increase in revenues 
        would not be significant in any year. Collections of 
        criminal fines are deposited in the Crime Victims Fund 
        and are later spent. CBO estimates that the criminal 
        penalties that would be established under the bill 
        would increase direct spending from the Crime Victims 
        Fund by less than $500,000 per year.

   Section 205 would allow the State Department's 
        International Litigation Fund to retain awards of costs 
        and attorneys' fees as a result of a decision by an 
        international tribunal. Based on information from the 
        department, CBO estimates that the Department of State 
        would collect and spend less than $500,000 a year.

   Section 214 would authorize the Secretary to provide 
        museum visitor and educational outreach services and to 
        sell, trade, or transfer documents and articles that 
        are displayed at the United States Diplomacy Center. 
        Any proceeds generated from these services or sales 
        would be retained and spent by the center, and CBO 
        estimates that this provision would have an 
        insignificant net effect on direct spending.

   Several sections in title III of the bill would 
        amend retirement benefits for State Department 
        personnel by slightly broadening the authority of the 
        department to temporarily rehire Foreign Service 
        retirees without terminating their pension benefits; 
        changing personnel review and termination procedures 
        for each Foreign Service class; establishing a 60-day 
        deadline for the Office of Personnel Management to 
        issue regulations in accordance with a previously 
        enacted change in pension benefits for certain spouses 
        of Foreign Service workers; and allowing employees of 
        Office of Coordination for Reconstruction and 
        Stabilization to continue collecting full retirement 
        annuities provided by the Foreign Service retirement 
        system. Under current law, Foreign Service retirement 
        benefits are temporarily suspended during any period of 
        reemployment by the federal government. CBO estimates 
        that enacting the provisions would increase direct 
        spending by less than $500,000 annually over the 2005-
        2015 period.

   Section 2207 would authorize the President to waive 
        the requirement that a foreign government pay to the 
        United States the net proceeds from the sale of any 
        military equipment it has received from the United 
        States on a grant basis. CBO estimates the forgone 
        offsetting receipts would not be significant.

              INTERGOVERNMENTAL AND PRIVATE-SECTOR IMPACT

    S. 600 contains no intergovernmental or private-sector 
mandates as defined in UMRA and would not affect the budgets of 
state, local, or tribal governments.

Estimate Prepared By:

    Federal Costs--State Department: Sunita D'Monte; Foreign 
Aid: Joseph C. Whitehill; Foreign Service Retirement: Geoffrey 
Gerhardt; Law Enforcement: Mark Grabowicz; Revenue Effects: 
Annabelle Bartsch.
    Impact on State, Local, and Tribal Governments: Melissa 
Merrell.
    Impact on the Private Sector: Paige Piper/Bach.

Estimate Approved By:

    Peter H. Fontaine, Deputy Assistant Director for Budget 
Analysis.

           Division B--Foreign Assistance Authorization Act,
                            Fiscal Year 2006


                          (A) Summary of Funds


                        [in millions of dollars]


----------------------------------------------------------------------------------------------------------------
                                                                 FY 2005
                                                                estimate      FY 2006  request   Committee mark
----------------------------------------------------------------------------------------------------------------
Child Survival & Health Programs Fund (CSH)...............            1,538             1,252             1,252
Global Fund to Fight AIDS, Tuberculosis, and Malaria\1\...             (248)             (100)             (100)
Development Assistance (DA)...............................            1,448             1,103             1,103
International Disaster and Famine Assistance..............              485               656               656
Transition Initiatives....................................               49               325               325
Development Credit Authority (DCA)........................                8                 8                 8
USAID Operating Expenses (OE).............................              613               681               681
USAID Capital Investment Fund.............................               59                78                78
USAID Inspector General Operating Expenses (IG)...........               35                36                36
Economic Support Fund (ESF)...............................            2,481             3,036             3,036
Assistance for Eastern Europe and the Baltic States (SEED)              393               382               382
Assistance for the Independent States of the Former Soviet              556               482               482
 Union (FSA)..............................................
Peace Corps...............................................              317               345               345
Inter-American Foundation.................................               18                18                18
African Development Foundation............................               19                19                19
Millenium Challenge Corporation...........................            1,488             3,000             3,000
International Narcotics Control and Law Enforcement                     326               524               524
 (INCLE)..................................................
Andean Counterdrug Initiative (ACI).......................              725               735               735
Nonproliferation, Anti-Terrorism, Demining (NADR).........              399               440               440
Treasury Technical Assistance.............................               19                20                20
Debt Relief...............................................               99               100               100
International Military Education & Training (IMET)........               89                87                87
Foreign Military Financing (FMF)..........................            4,745             4,589             4,589
Peacekeeping Operations (PKO).............................              178               196               196
International Organizations & Programs (IO&P).............              326               282               282
                                                           -----------------------------------------------------
      Total...............................................           16,413            18,394            18,394
----------------------------------------------------------------------------------------------------------------
\1\The administration requested $3.16 billion for international HIV/AIDS, tuberculosis, and malaria programs in
  FY2006, a 9 percent increase over the estimated amount to be provided in FY2005. The request included $2.564
  billion to be appropriated through the Foreign Operations appropriations and $596 million through
  appropriations for the Departments of Labor and Health and Human Services.
This bill authorizes part of this request through the Child Survival and Health (CSH) account which includes the
  President's request of $439 million for HIV/AIDS, tuberculosis, and malaria programs. The authorized amount
  for the CSH account also includes $100 million for the Global Fund to Fight AIDS, Tuberculosis, and Malaria.
  (The President requested $300 million to be appropriated for contributions to the Global Fund; the other $200
  million is divided between the Global HIV/AIDS Initiative ($100 million) and NIH/HHS ($100 million). The GHAI
  account, for which the President requested $1.87 billion, is not authorized in this bill because it is already
  authorized in the United States Leadership Against HIV/AIDS, Tuberculosis, and Malaria Act of 2003 (P.L. 108-
  25).