[Senate Report 109-91]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 140
109th Congress                                                   Report
                                 SENATE
 1st Session                                                     109-91

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



 
  AMENDING THE PUBLIC HEALTH SERVICE ACT WITH RESPECT TO THE NATIONAL 
     FOUNDATION FOR THE CENTERS FOR DISEASE CONTROL AND PREVENTION

                                _______
                                

                 June 27, 2005.--Ordered to be printed

                                _______
                                

Mr. Enzi, from the Committee on Health, Education, Labor, and Pensions, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 655]

    The Committee on Health, Education, Labor, and Pensions, to 
which was referred the bill (S. 655) to amend the Public Health 
Service Act with respect to the National Foundation for the 
Centers for Disease Control and Prevention, having considered 
the same, reports favorably thereon with an amendment in the 
nature of a substitute and recommends that the bill (as 
amended) do pass.

                                CONTENTS

                                                                   Page
  I. Purpose and summary of the bill..................................1
 II. Background and need for the legislation..........................2
III. Legislative history and committee action.........................3
 IV. Explanation of bill and committee views..........................3
  V. Cost estimate....................................................4
 VI. Application of law to the legislative branch.....................5
VII. Regulatory impact statement......................................5
VIII.Section-by-section analysis......................................6

 IX. Changes in existing law..........................................6

                   I. Purpose and Summary of the Bill

    S. 655 makes several technical corrections and improvements 
to Section 399G of the Public Health Service Act (PHSA), which 
established the National Foundation for the Centers for Disease 
Control and Prevention (CDC Foundation). Most significantly, 
these corrections assure that the Foundation receives funds and 
support services from the Centers for Disease Control and 
Prevention (CDC) to support the CDC Foundation's administrative 
and operating expenses.

              II. Background and Need for the Legislation

    The Foundation is a private, not-for-profit foundation 
established by Congress to raise private funds to support the 
work of the CDC. Authorized in 1992 and incorporated as a 
nonprofit organization in Georgia 11 years ago, the Foundation 
during its brief history has raised more than $100 million to 
augment CDC's efforts. Over the past 5 years the Foundation has 
raised on average $15 million per year to support initiatives 
at CDC. This represents a 30:1 return on CDC's $500,000 per 
year investment in the CDC Foundation. The funds the CDC 
Foundation raises in support of CDC bring the flexibility of a 
non-profit organization to build effective partnerships between 
CDC and private sector corporations, foundations and 
individuals to improve health and safety around the world.
    The Foundation has managed more than 100 programs that have 
helped CDC do more and faster work in this country and in more 
than 30 countries on five continents to fight deadly infectious 
and other diseases that threaten the safety and well-being of 
U.S. citizens here and abroad. With an outstanding 
internationally renowned Board of Directors from the corporate, 
philanthropic, educational and public health sectors, the non-
profit CDC Foundation brings accountability and flexibility to 
every private-sector partnership it builds on behalf of CDC. 
Examples of such partnerships include:
          1. Lilly International Fellowships: A series of year-
        long laboratory fellowships that bring laboratorians 
        from other countries' ministries of health to learn 
        from CDC laboratorians and build relationships to 
        prepare for when diseases in those countries threaten 
        U.S. citizens.
          2. Corporate/CDC Roundtable on Global Health Threats: 
        This CDC Foundation-based roundtable brings together 
        the CDC Director and her leadership team with 
        representatives of 10 global corporations to develop 
        joint approaches to detecting and responding to global 
        health threats that threaten U.S. citizens and each 
        corporations' bottom line. Members include top 
        executives from such corporate leaders as GE, General 
        Motors, IBM, UPS, Coke and Wal-Mart. In its first 
        meeting CDC and the corporate members agreed to begin 
        exchanging disease surveillance data that should help 
        both CDC and the corporations do their respective jobs 
        better.
          3. Emergency Preparedness and Response Fund: After 9/
        11 and the anthrax attacks, the CDC Foundation 
        established a special fund that enables CDC to respond 
        with greater flexibility during future crises when 
        existing government regulations might not be sufficient 
        to enable CDC to do all it can as possible to save 
        lives. The fund provides credit cards, made available 
        by the Synovus Corporation, to the administrative 
        leader of each of the 15 CDC teams that have been 
        established to respond to national health threats.
          4. Emergency Operations Center: After 9/11 CDC 
        Foundation Board member Bernie Marcus, a co-founder of 
        Home Depot, recognized the need for CDC to have a 
        state-of-the-art Emergency Operations Center. He 
        donated $4 million to the CDC Foundation as a challenge 
        grant to encourage other United States corporations to 
        help CDC build a world-class emergency operations 
        center ``at the speed of business.'' The CDC Foundation 
        quickly contacted corporations and raised over $400,000 
        worth of in-kind equipment donations from corporations 
        like Dell, Motorola, and Shure. Because of the Marcus 
        gift and other corporate donations, CDC's new Emergency 
        Operations Center opened 6 months early, just in time 
        to track and combat the deadly SARS threat.
          5. Management Academy for Public Health: Using $1 
        million each from the Robert Wood Johnson Foundation, 
        the Kellogg Foundation, CDC and the Health Resources 
        and Services Administration (HRSA), the Foundation 
        supported the establishment of a new management academy 
        to train mid-career leaders from State and local health 
        departments in how to manage people, data and dollars. 
        The academy is now totally self-sufficient and 
        continues to train hundreds of public health leaders 
        from across the country.
          6. Mobile Breast Cancer Detection: Through a multi-
        million dollar grant from Avon, the Foundation has 
        purchased and placed mobile mammography screening vans 
        to reach underserved women in multiple States across 
        the country. Funding also supports a CDC scientist to 
        evaluate the van placement programs and disseminate 
        lessons learned about best practices that will help 
        other such programs across the country be most 
        effective and have the best chance of becoming self-
        supporting.
          7. Field Disease Detection and Response Training 
        Programs in Developing Countries: With privately-raised 
        support from organizations like the World Bank, the 
        Nuclear Threat Initiative and the Ellison Medical 
        Foundation, the CDC Foundation has enabled CDC to 
        establish special disease detection and/or laboratory 
        support programs in countries like Brazil, India and 
        Kenya that will help detect and control deadly 
        infectious diseases that pose serious threats not only 
        in those countries, but to the United States as well.

             III. Legislative History and Committee Action

    On March 17, 2005, Senator Isakson, for himself and Senator 
Chambliss, introduced S. 655, to amend Section 399G of the PHSA 
to improve the Foundation for the Centers for Disease Control 
and Prevention (CDC). On April 27, 2005, the committee held an 
executive session to consider S. 655. The committee approved an 
amendment in the nature of a substitute offered by Senator 
Enzi, and then approved S. 655, as amended, by unanimous voice 
vote.

              IV. Explanation of Bill and Committee Views

    The operating costs for the CDC Foundation have climbed 
from $300,000 when it began in 1995 to almost $3 million in 
2005. In 1995, CDC's $500,000 of support was sufficient to 
fully support the Foundation's operations. However, this 
amount, which has been capped since the Foundation's inception, 
no longer provides sufficient funds to allow the CDC Foundation 
to provide the kinds of beneficial support noted in the 
examples above. S. 655 will allow the CDC Director to support 
the work of the Foundation beyond the $500,000 baseline up to 
$1.25 million if, in the judgment of the CDC Director, an 
occasion would arise that would warrant it. Such support does 
not require an increased appropriation since funds would come 
from existing appropriations to the CDC director's office. Such 
financial support, at most, would constitute approximately half 
of the operating costs of the Foundation.
    The legislation would also incorporate language that would 
allow CDC to provide facilities, utilities, and support 
services to the Foundation if ``it is determined by the 
Director to be advantageous to the programs of such Centers.''
    Currently, privately supported fellows assigned to help CDC 
implement Foundation programs are artificially limited to 2 
years each. This creates program implementation problems for 
programs supported by private funding from organizations like 
the Robert Wood Johnson and Kellogg Foundations that sometimes 
can run 3 or 4 years. To remedy this, the legislation aligns 
the length of any privately supported fellowships to coincide 
with the duration of private funding for each such fellowship.

                            V. Cost Estimate

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, May 31, 2005.
Hon. Mike Enzi,
Chairman, Committee on Health, Education, Labor, and Pensions,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 655, a bill to amend 
the Public Health Service Act with respect to the National 
Foundation for the Centers for Disease Control and Prevention.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Tim 
Gronniger.
             Sincerely,
                                     Douglas Holtz-Eakin, Director.
    Enclosure.

S. 655--A bill to amend the Public Health Service Act with respect to 
        the National Foundation for the Centers for Disease Control and 
        Prevention

    Summary: S. 655 would modify the Public Health Service Act 
to increase the amount of the grants the Department of Health 
and Human Services is authorized to provide to the National 
Foundation of the Centers for Disease Control and Prevention 
(CDC) from $500,000 per year to $1,250,000 per year. The bill 
also would allow longer terms of voluntary service to be 
contributed from the Foundation to the CDC and would allow 
sharing of equipment and support services from the CDC to the 
Foundation.
    CBO estimates that enacting S. 655 would cost $500,000 in 
2006 and $3.5 million over the 2006-2010 period, assuming 
appropriation of the necessary amounts.
    S. 655 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. S. 655 would not affect direct spending or 
receipts.
    Estimated Cost to the Federal Government: The estimated 
budgetary impact of S. 655 is shown in the following table. The 
costs of this legislation fall within budget function 550 
(health).

----------------------------------------------------------------------------------------------------------------
                                                                     By fiscal year, in millions of dollars--
                                                                 -----------------------------------------------
                                                                   2005    2006    2007    2008    2009    2010
----------------------------------------------------------------------------------------------------------------
                                        SPENDING SUBJECT TO APPROPRIATION

Spending Under Current Law:
    Estimated Authorization Level \1\...........................       1       1       1       1       1       1
    Estimated Outlays...........................................       1       1       1       1       1       1
Proposed Changes:
    Estimated Authorization Level...............................       0       1       1       1       1       1
    Estimated Outlays...........................................       0       1       1       1       1       1
Spending Under S. 655: \2\
    Estimated Authorization Level \1\...........................       1       1       1       1       1       1
    Estimated Outlays...........................................       1       1       1       1       1       1
----------------------------------------------------------------------------------------------------------------
\1\ The 2005 level is the amount appropriated for that year.
\2\ Rows may not sum to totals because of rounding.

    Basis of Estimate: The National Foundation for the CDC is a 
not-for-profit entity that raises private funds to support the 
work of the CDC. Under current law, CDC may accept the services 
of an individual who receives financial support from the 
Foundation for a period of up to two years. S. 655 would 
eliminate that two-year restriction. The bill would also allow 
the CDC to provide in-kind transfers and support services to 
the Foundation. Under current law, the Foundation receives 
$500,000 in transfers from the funds appropriated to the 
Department of Health and Human Services. S. 655 would require 
HHS to transfer at least that amount, and would allow the 
department to transfer up to $1,250,000 to the Foundation each 
year.
    In addition to the $500,000 that CBO expects will be 
transferred to the foundation each year under current law, CBO 
estimates that S. 655 would cost $500,000 in 2006 and $3.5 
million over the 2006-2010 period, assuming the appropriation 
and transfer of the necessary amounts.
    Intergovernmental and private-sector impact S. 655 contains 
no intergovernmental or private-sector mandates as defined in 
the UMRA and would not affect the budgets of state, local, or 
tribal governments.
    Estimate prepared by: Federal Costs: Tim Gronniger; Impact 
on State, Local, and Tribal Governments: Leo Lex; Impact on the 
Private Sector: Meena Fernandes.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

            VI. Application of Law to the Legislative Branch

    S. 655 amends section 399G of the PHSA to make improvements 
to the functioning of the Foundation for the Centers for 
Disease Control and Prevention, a non-profit corporation in the 
State of Georgia that supports the work of the CDC. As such, it 
has no application to the legislative branch.

                    VII. Regulatory Impact Statement

    The legislation amends section 399G of the PHSA to make 
improvements to the functioning of the Foundation for the 
Centers for Disease Control and Prevention. It includes a 
requirement that the Director of the CDC transfer no less than 
$500,000 and no more than $1.25 million of the CDC's 
appropriated funds to the Foundation to support its costs in 
supporting the work of the CDC. Pursuant to the requirements of 
paragraph 11(b) of Rule XXVI of the Standing Rules of the 
Senate, the Committee has determined that the bill will not 
have significant regulatory impact.

                   VIII. Section-by-Section Analysis


Sec. 1. National Foundation for the Centers for Disease Control and 
        Prevention; Acceptance of Voluntary Services; Federal Funding

    Paragraph (a) makes a technical amendment to clarify that 
any fellowship with the CDC Foundation will match the length of 
time the endowment for that project takes.
    Paragraph (b) requires the Foundation's annual reports to 
include an accounting of the use of funds transferred from the 
CDC to the Foundation for its operating expenses and that these 
reports be provided to the appropriate committees in Congress.
    Paragraph (c) makes a change to require the CDC Director to 
transfer no less than $500,000 and not more than $1,250,000 to 
the Foundation for operating expenses.

                      IX. Changes in Existing Law

    In compliance with rule XXVI paragraph 12 of the Standing 
Rules of the Senate, the following provides a print of the 
statute or the part or section thereof to be amended or 
replaced (existing law proposed to be omitted is enclosed in 
the black brackets, new matter is printed in italic, existing 
law in which no change is proposed is shown in roman):

Public Health Service Act

           *       *       *       *       *       *       *



  Part N--National Foundation for the Center for Disease Control and 
                               Prevention


SEC. 399G. [280D-11] ESTABLISHMENT AND DUTIES OF FOUNDATION.

    (a) In General.--* * *

           *       *       *       *       *       *       *

    (h) General Provisions.--
          (1) Authority for accepting funds.--* * *
          (2) Authority for acceptance of voluntary services.--
                  (A) The Director of the Centers for Disease 
                Control and Prevention may accept, on behalf of 
                the Federal Government, any voluntary services 
                provided to such Centers by the Foundation for 
                the purpose of aiding or facilitating the work 
                of such Centers. [In the case of an individual, 
                such Director may accept the services provided 
                under the preceding sentence by the individual 
                for not more than 2 years.] In the case of an 
                individual, such Director may accept the 
                services provided under the preceding sentence 
                by the individual until such time as the 
                private funding for such individual ends.

           *       *       *       *       *       *       *

          (7) Reports.--
                  (A) Not later than February 1 of each fiscal 
                year, the Foundation shall publish a report 
                describing the activities of the Foundation 
                during the preceding fiscal year. Each such 
                report shall include for the fiscal year 
                involved a comprehensive statement of the 
                operations, activities, financial condition, 
                and accomplishments of the Foundation, 
                including an accounting of the use of amounts 
                provided for under subsection (i)
                  (B) * * *
                  [(C) The Foundation shall make copies of each 
                report submitted under subparagraph (A) 
                available for public inspection, and shall upon 
                request provide a copy of the report to any 
                individual for a charge not exceeding the cost 
                of providing the copy.]
                  (C) The Foundation shall make copies of each 
                report submitted under subparagraph (A) 
                available--
                          (i) for public inspection, and shall 
                        upon request provide a copy of the 
                        report to any individual for a charge 
                        not to exceed the cost of providing the 
                        copy; and
                          (ii) to the appropriate committees of 
                        Congress.

           *       *       *       *       *       *       *

    (i) Federal Funding.--
          (1) Authority for annual grants.--
                  (A) * * *

           *       *       *       *       *       *       *

          (2) Funding for grants.--
                  (A) For the purpose of grants under paragraph 
                (1), there is authorized to be appropriated 
                [$500,000] $1,250,000 for each fiscal year.
                  (B) For the purpose of grants under paragraph 
                (1), the Secretary may for each fiscal year 
                make available [not more than $500,000] not 
                less than $500,000, and not more than 
                $1,250,000 from the amounts appropriated for 
                the fiscal year for the programs of the 
                Department of Health and Human Services. Such 
                amounts may be made available without regard to 
                whether amounts have been appropriated under 
                subparagraph (A).
          (3) Certain restrictions.--* * *
          (4) Support services.--The Director of the Centers 
        for Disease Control and Prevention may provide 
        facilities, utilities, and support services to the 
        Foundation if it is determined by the Director to be 
        advantageous to the programs of such Centers.

           *       *       *       *       *       *       *


                                  
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