Combating Terrorism: 2001 Congressional Debate on Emergency Supplemental Allocations

Congressional research reportSep 27, 2002

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Combating Terrorism: 2001 Congressional Debate

on Emergency Supplemental Allocations

Updated September 27, 2002

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Combating Terrorism: 2001 Congressional Debate on

Emergency Supplemental Allocations

Summary

Within days of the September 11 terrorist attacks on the World Trade Center

and the Pentagon, Congress approved a $40 billion emergency supplemental

appropriations (P.L. 107-38/H.R. 2888) to aid victims of the terrorist attacks, to

bolster security at airports and other sites, to pursue the investigation and prosecution

of those responsible, and to support national security. The appropriation measure

partitioned the $40 billion into three clusters. The first $10 billion was available

immediately for allocation by the President. The second $10 billion was available

15 days after the President notified Congress about how he would distribute the

funds. The final $20 billion would be allocated within an enacted FY2002

appropriation bill.

Through notifications beginning on September 21, the Administration fully

allocated the first $20 billion over the following five months. Between February and

August 2002, the White House has made some adjustments to these earlier

distributions, primarily to provide additional funds for the Transportation Security

Administration. Congress allocated the final $20 billion as a separate title in the

FY2002 Defense Department Appropriation (P.L. 107-117; H.R. 3338), cleared for

the White House on December 20.

Of the $40 billion total, the White House proposed $21.1 billion for the Defense

Department (53%); $18.9 billion for non-defense agencies (47.3%). Among nondefense programs, recovery activities, including debris removal, efforts to repair

damaged equipment and infrastructure, and relocation of dislocated offices and

workers, would receive the largest share – roughly $6.2 billion, or 15% of the total.

Victim relief represented an 8.3% share, or $3.3 billion, and physical security – for

both infrastructure and aviation – totaled about $4.1 billion or 10%. Resources to

combat bioterrorism totaled $1.6 billion, or about 4.4% of the total.

There was broad bipartisan support for the enactment of significant additional

resources for recovery and response to the September 11 terrorism attacks.

Nevertheless, sharp differences emerged as to whether the original $40 billion

package was sufficient, whether the allocations matched the most critical priorities,

especially regarding homeland security needs, and whether New York and other

jurisdictions directly affected by the attacks were receiving adequate funds. Many

assumed that New York would receive about half, or $20 billion of the total

emergency supplemental. President Bush said he would veto any spending measure

enacted in 2001 that went beyond the $40 billion approved in P.L. 107-38.

On January 10, 2002, the President signed into law P.L. 107-117 (H.R. 3338),

the Defense Appropriations bill that includes the “second” $20 billion in emergency

supplemental spending for homeland security, increased defense needs, and other

efforts to combat terrorism. As enacted, P.L. 107-117 differs significantly from the

plan President Bush proposed. The legislation roughly doubles the request for

bioterrorism, law enforcement, and infrastructure security activities, while reducing

by more than half the $7.3 billion proposed for defense.

Contents

Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Composition of the Supplemental Funds to Combat Terrorism . . . . . . . . . . . . . . 3

Division and Distribution of the Total $40 billion Package . . . . . . . . . . . . . 3

Allocation by Federal Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Policy Priorities of Emergency Supplemental Allocations . . . . . . . . . . 5

The President’s $20 Billion Allocation Request and Congressional

Debate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Congressional Debate and Modifications to the President’s Proposal . 9

Appendix A - Defense Funding Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Appendix B – Non-Defense Emergency Supplemental Transfers

Organized by Appropriations Bill and Account . . . . . . . . . . . . . . . . . . . . . . 26

List of Figures

Figure 1. Composition of $40 Billion Supplemental

Requested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Figure 2. Composition of $40 Billion Supplemental

Enacted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Figure 3. Allocation of $40 Billion by Major Purposes:

Administration Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Figure 4. Allocation of $40 Billion by Major Purposes:

Actual . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Figure 5. President’s Request for the Second $20 Billion Allocation . . . . . . . . 10

Figure 6. Enacted Allocation of Second $20 Billion . . . . . . . . . . . . . . . . . . . . . . 11

List of Tables

Table 1. Allocations of Funds to Combat Terrorism by Agency . . . . . . . . . . . . . 3

Table 2. Combating Terrorism Supplemental Transfers: Policy Priorities . . . . . . 6

Table 3. Congressional Action on DOD’s Share of $20 Billion Supplemental . . 20

Table A1. DOD Allocations under $40 Billion Emergency Terrorism

Response Supplemental . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Appendix – Summary of All Appropriations Bills . . . . . . . . . . . . . . . . . . . . . . . 27

Agriculture and Related Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

Commerce, Justice, and State, the Judiciary, and Related Agencies . . . . . . . . . . 30

Defense and Military Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

District of Columbia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

Energy and Water Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

Foreign Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

Interior and Related Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44

Labor, Health and Human Services, and Education . . . . . . . . . . . . . . . . . . . . . . 46

Legislative Branch . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

Transportation and Related Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

Treasury, Postal Service, Executive Office of the President, and General Govt . 56

Veterans Affairs, Housing and Urban Development, and Independent

Agencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61

Combating Terrorism: 2001 Congressional

Debate on Emergency Supplemental

Allocations

Most Recent Developments

On January 10, 2002, President Bush signed into law P.L. 107-117 (H.R. 3338),

the Defense Appropriations bill that includes $20 billion in emergency supplemental

spending for homeland security, increased defense needs, and other efforts to combat

terrorism. The $20 billion package had been enacted earlier in mid-September as

part of a $40 billion emergency spending measure (P.L. 107-38) to support recovery

efforts following the attacks and to launch the war against terrorism. President Bush

controlled the allocation of first $20 billion portion while Congress was required to

distribute the second $20 billion in a subsequent appropriation bill.

As enacted, P.L. 107-117 differs significantly from the plan President Bush

proposed in mid-October for allocating the second $20 billion portion. The

legislation roughly doubles the request for bioterrorism, law enforcement, and

infrastructure security activities, while reducing by more than half the $7.3 billion

proposed for defense. Earlier, the House and Senate each had rejected efforts to

provide additional sums beyond the $20 billion total. Proposals would have added

between $6 billion and $15 billion, largely for homeland security and relief for New

York and other jurisdictions most directly affected by the attacks. The final

compromise – to increase homeland security and New York aid and decrease defense

resources – partially accommodated the position of those who sought more spending

for the domestic programs, but without exceeding $20 billion. President Bush had

threatened to veto legislation that went beyond $20 billion, arguing that sufficient

money was available for the time being, and that he would consider additional needs

in 2002. The Administration has proposed $37.7 billion for homeland security

activities in FY2003.

Introduction

Within days of the September 11 terrorist attacks on the World Trade Center

and the Pentagon, Congress approved a $40 billion emergency supplemental

appropriation (P.L. 107-38/H.R. 2888) to aid victims of the terrorist attacks, to

bolster security at airports and other sites, to pursue the investigation and prosecution

of those responsible, and to support national security. The appropriation measure,

which was designated as emergency spending so that it would not be subject to

limitations set in concurrent budget resolutions, partitioned the $40 billion into three

clusters:

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$10 billion was immediately available to the President, following

consultation with House and Senate Appropriations Committee

leaders.

$10 billion was available following the submission by the Office of

Management and Budget (OMB) of a specific plan regarding how

the funds will be allocated. Congress had 15 days to review and

consult with Administration officials over the spending plan before

resources became available.

$20 billion would be available for obligation only when amounts

were specifically allocated in FY2002 appropriations measures

passed by Congress.

Of the $40 billion total, not less than $20 billion “shall be allocated for disaster

recovery activities and assistance related to the terrorist acts in New York,

Pennsylvania, and Virginia on September 11, 2001.”1 The President would submit

detailed requests to Congress if further funding is required. The Director of OMB

was to provide quarterly reports to the appropriations committees on the use of funds,

beginning on January 2, 2002.

Beginning on September 21, OMB sent Congress a series of notifications of

intended and requested allocations of the $40 billion emergency supplemental,

including a notice on October 16 containing details of the $20 billion proposal that

would need to be enacted by Congress in an FY2002 appropriation bill. Congress

debated the request as a separate section to the FY2002 Defense Appropriation bill,

the final spending measure taken up by Congress in 2001.

As costs of recovery and response efforts rose, however, policy differences

emerged over the amount, timing, and priorities of the supplemental spending. The

White House, concerned over potential rising budget deficits for FY2002, argued that

the $40 billion emergency total was sufficient for the moment, but that the President

would entertain more spending in 2002 if needs exist. Many lawmakers, including

senior Appropriations Committee members, however, called for immediate resources

well above the $40 billion figure, with an emphasis on funds for New York City in

order to meet the $20 billion allocation directive in P.L. 107-38. President Bush said

that he would veto legislation passed in 2001 that would spend more than the $40

billion already enacted.

This report discusses the overall composition of the Administration’s plan to

allocate the $40 billion supplemental. It provides the status of the planned and

proposed allocations by category, agency, general purpose, and appropriation

account. It further tracks congressional debate, highlighting alternative initiatives

under consideration and assessing major changes directed by Congress. An appendix

attached at the end of the report includes 12 tables that describe the purposes and

spending amounts in each appropriation chapter and congressional decisions for

allocating the second $20 billion portion.

P.L. 107-38.

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Composition of the Supplemental Funds to Combat

Terrorism

Division and Distribution of the Total $40 billion Package

For the total $40 billion supplemental, the White House proposed that over half

– $21.1 billion, or 52.8% – would be allocated for the DOD, while $18.9 billion, or

47.3% would be distributed among non-defense agencies. As illustrated in Figures

1 and 2 below, Congress, through enactment of H.R. 3338, altered the President’s

recommended plan. The majority – $22.7 billion, or 56.6% – is now available for

non-defense activities, while $17.3 billion, or 43.3%, supports defense programs.

Allocation by Federal Agency. Other than the Department of Defense, the

other major agency recipients, out of the $40 billion total, are the Federal Emergency

Management Agency ($5.6 billion), which provides disaster assistance relief, Health

and Human Services ($2.9 billion), Housing and Urban Affairs ($2.7 billion), Justice

($2.1 billion), and Transportation ($3 billion).2

Table 1. Allocations of Funds to Combat Terrorism by Agency

(in billions of dollars and percentage of total)

Department/

Agency Totals

Executed Fifteen-day Admin.

P.L.

Total

transfers

wait

request 107-117 Supplement

As % of

$40 Bil.

Total Supplemental

$10.0

$20.0

$40.0

100.0%

Defense subtotal

5.9

7.9

7.3

3.5

17.3

43.3%

Non-defense subtotal

4.1

2.1

12.7

16.5

22.7

56.6%

FEMA

1.0

0.0

5.5

4.6

5.6

14.0%

HHS

0.1

0.0

1.6

2.8

2.9

7.3%

HUD

0.0

0.7

0.0

2.0

2.7

6.8%

Justice

0.0

1.1

2.1

5.3%

Transportation

1.2

0.5

0.7

1.3

3.0

7.5%

State

0.3

0.5

0.0

0.8

2.0%

USAID

0.6

0.1

0.0

0.1

0.8

2.0%

Treasury

0.1

0.0

0.3

0.6

0.7

1.8%

U.S. Postal Service

0.0

0.2

0.0

0.5

0.7

1.8%

Labor

0.0

2.0

0.2

0.5%

Other non-defense

0.8

0.1

1.5

2.3

3.2

8.0%

Sources: OMB, House and Senate Appropriations Committees, CRS calculations.

During early to mid-2002, the White House reallocated some funds from earlier

distributions. The largest involved the transfer of $1.03 billion previously allocated to

FEMA to the Transportation Security Administration. Such transfers were regarded as

“bridge loans” for TSA. The intent was to restore FEMA funding out of the then-pending

FY2002 Supplemental Appropriation.

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Figure 1. Composition of $40 Billion Supplemental

Requested

($s - billions & % of total)

Non-defense $18.9

47.3%

52.8%

Defense $21.1

Figure 2. Composition of $40 Billion Supplemental

Enacted

($s - billions & % of total)

Non-defnse $22.7

56.8%

43.3%

Defense $17.3

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Policy Priorities of Emergency Supplemental Allocations. There has

been broad bipartisan support for the enactment of significant additional resources

for recovery and response to the September 11 terrorism attacks. Nevertheless, sharp

differences emerged as to whether the original $40 billion package was sufficient,

whether the allocations matched the most critical priorities, especially regarding

homeland security needs, and whether New York and other jurisdictions directly

affected by the attacks were receiving adequate funds. Many assumed that New York

would receive about half, or $20 billion of the total emergency supplemental.

Table 2 and Figures 3 and 4 below provide estimates of how the

Administration’s planned and proposed allocations of the $40 billion were distributed

across ten general categories, and how these amounts compared to Congressional

changes.3 Under the President’s plan, Defense activities (outlined in more detail

below) would have accounted for over half of the $40 billion supplemental, while

recovery activities, would have received roughly $6.2 billion, or 15.5% of the total.

With the enactment of H.R. 3338, total amounts for both of these categories fell in

order to make room within the $40 billion for increases elsewhere. Defense funds

dropped to $17.3 billion, or 43.4% of the total, while recovery resources declined to

$6 billion, or a 15.1% share of the total.

Although all other activities represent far smaller shares of the supplemental

package, funding for several rose sharply as a result of congressional decisions in

H.R. 3338. For combating bioterrorism, the White House had proposed $1.8 billion,

while final amounts total $3 billion, or 7.6% of the total. Aviation and infrastructure

security would have received $4.1 billion under the President’s proposal, but with

enactment of H.R. 3338, these activities received $5.7 billion, or 14.3% of the $40

billion package. Direct aid to victims of the attacks had totaled $3.3 billion under the

President’s plan, growing slightly to $3.5 billion, or 8.8% of the total under the final

allocation. Resources for investigation and law enforcement activities would have

received a $1.5 billion allocation, an amount that grew, following enactment of H.R.

3338, to $2.6 billion, or 6.5% of the total. (Details of congressional debate on H.R.

3338 are discussed below.)

Despite Congress’ cut of $3.5 billion in the $7.3 billion DOD request for the

emergency supplemental, the President’s general priorities for defense spending to

combat terrorism remained largely intact. In both the President’s request and in the

enacted bill, about 29% of the $17.3 billion allocated for Defense in the Emergency

Terrorism Response supplemental is for funding of the Afghan war, and another 29%

is for intelligence and surveillance activities. The remaining funds are distributed

These figures are based on CRS analysis and should be regarded as illustrative rather than

a precise calculation of exact allocations. Some OMB notifications have combined funding

for multiple purposes, making it impossible to disaggregate specifically among the ten

categories used here. Moreover, differences exist over how to characterize the purposes and

categories of emergency funds. The presentation made here offers one possible analytical

scheme. In addition, figures have been adjusted to reflect ten additional notifications made

between February and August 2002 regarding the reallocation of funds that had previously

been made available for other purposes. The largest amounts involved the transfer of funds

from FEMA to the Transportation Security Administration. The Administration planned to

restore FEMA funding following enactment of the FY2002 Supplemental appropriation.

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among self-defense weapons for ships and upgraded security at bases (8.6%),

improved command and control (8%), precision-guided munitions (10.4%), repair

and upgrade of the Pentagon, and initial crisis response (8.4% and 3.9%

respectively). For more detail, see Table A1 in the Appendix.

Table 2. Combating Terrorism Supplemental Transfers: Policy

Priorities

($s – millions)

Purpose

Bioterrorism

Defense

15House

Executed

Admin

Day/Wait

Passed

Transfers

Request

Transfers

H.R.

(1st $10B)

($20B)

(2 $10B)

3338

Senate

Passed

P.L.

H.R. 107-117

3338

Total

$40B

$3,018

$175 $1,587

$2,160

$3,046

$2,843

$5,900

$7,915 $7,349

$7,348

$2,000

$3,500 $17,315

Humanitarian

and other

foreign aid

$824

$412

$50

$1,286

Investigation

and law

enforcement

$188

$119 $1,179

$1,158

$2,367

$2,270

$2,577

Preparedness

$11

$655

$539

$450

$438

$452

Public

diplomacy

$12

$44

$19

$75

Recovery

from attacks

$960

$60

$5,166

$4,578

$6,503

$5,023

$6,043

Securityinfrastructure

$592

$131

$1,390

$1,422

$2,676

$2,843

$3,566

$1,211

$409

$415

$490

$508

$540

$2,160

$312

$725

$2,260

$2,285

$2,473

$2,479

$3,516

Securityaviation

Victim relief

TOTAL

$10,000

$10,000 $20,000 $20,000 $20,000 $20,000 $40,000

Source: CRS estimates. Columns may not add due to rounding.

Congress was able to accommodate the $3.5 billion cut to defense by providing

funding within the regular defense bill, by deferring less urgent requests, and by

inserting a provision that permits DOD to transfer up to $1.65 billion, or 1.5% of the

FY2002 appropriations, for RDT&E and procurement to fund the Afghan war or

DOD’s homeland defense activities, should that prove necessary.4 Congress also

In the regular DOD appropriations bill, Congress provided $478 million to improve

(continued...)

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restored the funding requested to repair and upgrade the Pentagon by transferring

$300 million of the funds remaining in the emergency supplemental that were to be

distributed by the President.5 Finally, in floor debate, several members of Congress

noted that the President was expected to submit another supplemental with additional

funding for defense when Congress reconvenes in January 2002.

Spending Category Definitions

Defense – Increased situational awareness (including classified), enhanced force

protection, improved command and control, increased worldwide posture (costs of

Afghan conflict), offensive counterterrorism, initial crisis response, Pentagon repair,

National Guard airport security, and other military construction.

Bioterrorism – countering potential biological, disease, and chemical threats to civilian

populations.

Humanitarian and other Foreign Aid – food and refugee relief for the Afghan people,

plus economic and security support for Pakistan and other “front-line” coalition partners

in Central Asia.

Investigation and Law Enforcement – Departments of Justice, Treasury, State and

other agency investigative and legal work following the September 11 attacks.

Preparedness – training, technical assistance and other activities aimed at strengthening

the capacity to respond to future terrorist events.

Public Diplomacy – enhanced U.S. broadcasts and media outreach capabilities to the

people in Central and Southwest Asia.

Recovery – debris removal, efforts to repair damaged equipment and infrastructure, and

relocation of dislocated offices and workers (excluding Pentagon repairs).

Security of Infrastructure/Personnel – strengthened security at critical U.S. facilities

worldwide (excluding DOD facilities) and evacuation of overseas personnel.

Security of Aviation Facilities – enhanced security at U.S. airports and on-board aircraft

(excluding DOD funding to station National Guard personnel at airports).

Victim Relief – assistance to individuals, families, and businesses directly affected by

the September 11 attacks.

(...continued)

protection of DOD’s weapons and facilities, thus restoring roughly half of the President’s

request (see Title IX of H.R. 3338). In the allocation of the emergency supplemental in H.R.

3338, Congress inserted a provision that permits DOD to transfer up to 1.5% of RDT&E and

procurement funds to Operation Enduring Freedom (Afghan war), and Operation Noble

Anvil (combat air patrol activities on both coasts for homeland defense), thus providing

another mechanism to ensure that adequate funding would be available.

Congress transferred $300 million of the funds that were to be allocated by the president

from the first $20 billion to upgrade the Pentagon, thus matching the total requested by DOD

(see H.Rept. 107-350, p. 424, and section 305(b) of H.R. 3338).

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Figure 3. Allocation of $40 Billion by Major Purposes:

Administration Plan

Defense

Preparedness

53.0%

Security

1.7%

10.4%

3.1%

Foreign aid

15.5%

4.4%

8.3%

3.7%

Recovery

Bioterrorism

Investigation

Victim Relief

Figure 4. Allocation of $40 Billion by Major Purposes:

Actual

Preparedness

Defense

43.4%

Security

1.1%

14.3%

3.2%

Foreign aid

15.1%

7.6%

6.5% 8.8%

Recovery

Bioterrorism

Investigation

Victim Relief

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The President’s $20 Billion Allocation Request and

Congressional Debate

The allocation process established in P.L. 107-38 for the Emergency

Supplemental spending measure guaranteed Congress a central role in deciding how

half of $40 billion anti-terrorism money would be spent. On October 16, OMB

submitted its plan for the second $20 billion portion of the supplemental that

Congress must subsequently enact.

Under the President’s plan for use of that $20 billion (Figure 5 below and

Table 2 above), the two largest shares of the supplemental request would go to DOD

(over one-third) and to recovery activities (over one-quarter), for a total of $12.5

billion.

Assistance to victims of the terrorist attacks represented about 11%, or $2.3

billion. Infrastructure and aviation security would receive 9%, or about $1.8 billion,

while funding to combat bioterrorism and investigative activities represented slightly

smaller shares of 8% or $1.4 billion, and 6% or $1.2 billion, respectively. There was

no humanitarian and other foreign assistance proposed in the second $20 billion

request.

Congressional Debate and Modifications to the President’s

Proposal. Following days of extensive negotiations among Members and with the

White House, the House Appropriations Committee voted on November 14 to

approve $20 billion in supplemental spending related to the terrorist attacks of

September 11. The money was attached as a separate section to the FY2002 Defense

Department Appropriation (H.R. 3338; H.Rept. 107-298).

Prior to the House Committee markup, a number of Members began to question

whether $20 billion was sufficient to meet all of the pressing needs related to the

terrorist attacks. Some argued that the President’s proposal lacked enough funding

for such things as law enforcement, bioterrorism preparedness, border protection, and

other homeland security priorities. Others, especially Members from New York,

contended that the President’s plan fell far short of the $20 billion that they

anticipated would be allocated out of the $40 billion total to meet the specific needs

of New York City, Virginia, and rural Pennsylvania where the attacks had the most

direct impact. They estimated that only about $9.7 billion was slated for New York.

Still others believed that additional defense resources were required beyond the $7.3

billion recommended by the Administration in the $20 billion plan. This issue

became especially controversial when President Bush, on November 6, said he would

veto the appropriation measure if it exceeded the $20 billion he had proposed.

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Figure 5. President’s Request for the Second $20 Billion

Allocation

Defense

36.8%

Security

8.9%

Bioterrorism

7.0%

5.9%

25.9%

11.3%

Investigation

4.2%

Victim Relief

Recovery

Preparedness

House Committee Markup. Before voting to approve H.R. 3338, the House

Appropriations Committee considered, but rejected three amendments that would

have pushed emergency terrorism spending beyond the $20 billion:

An amendment by Representative Obey (rejected 31-34) would

have added $6.5 billion. Major increases above the Committee

recommendations centered on initiatives to prepare against

bioterrorism (+ $1.1 billion); to better secure CDC, NIH, FDA and

other facilities where biological agents are kept (+$850 million); to

enhance mail security (+$500 million); to hire more air marshals,

secure aircraft cockpit doors and take other airline security measures

(+$450 million); to augment FBI and other law enforcement

capabilities (+$900 million); to combat nuclear proliferation and to

improve security of U.S. nuclear weapons (+$950 million); and to

enhance security for ports, trains, buses, colleges, and government

buildings (+$675 million). The amendment further proposed $832

million for Military Construction (+$730 million), including $482

million to construct a second lab at Ft. Derrick, Maryland, to

increase capacity to handle dangerous pathogens like smallpox.

An amendment by Representative Murtha (rejected by voice vote)

proposed an additional $6.5 billion for the Department of Defense,

almost doubling the $7.3 billion proposed by the Administration.

The bulk of the proposed increases were from Defense Department

proposals that were rejected by the Office of Management and

Budget. The chief increases in the amendment were: a more than

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doubling of the amount for intelligence programs (from $1.8 billion

to $3.8 billion) and precision guided munitions and other equipment

(from $624 million to $1.5 billion); $602 million in upgrades to

aircraft, and $800 million to accelerate renovation of the Pentagon.

An amendment by Representative Walsh (rejected 31-33) would

have added $9.7 billion. Additional funds focused on economic

relief and recovery for individuals and businesses in New York –

unemployment assistance (+$880 million); HUD’s Community

Development Fund (+$900 million); and FEMA disaster relief

activities in New York, Northern Virginia, and Pennsylvania (+$6.56

billion).

Following defeat of the Walsh amendment, proponents of additional funding for New

York continued to negotiate with Committee leaders and the White House for more

funds. On November 19 Representative Walsh reached an agreement with the

Administration that would result in the transfer of about $2.1 billion to meet

immediate needs in New York.6 By some estimates, this would bring the total for

New York out of the entire $40 billion supplemental to approximately $11. 5 billion.

The transfers for New York would be drawn from other programs.

Figure 6. Enacted Allocation of Second $20 Billion

Defense

17.5%

Bioterrorism

Preparedness

Security

2.2%

16.9%

14.2%

0.3%

Foreign aid

11.4%

25.1%

Investigation

12.4%

Recovery

Victim Relief

About $1.5 billion of the funds for New York represented new resources for individuals

and businesses directly affected by the terrorist attacks while another $555 million was redirected from FEMA debris removal and reconstruction activities in New York City to HUD

economic development programs to aid residents and businesses in the region.

CRS-12

House Consideration of Non-defense Programs. H.R. 3338, as passed

by the House on November 28, supported many of the funding priorities

recommended by the President – most notably those for defense and those for

investigation and law enforcement programs largely managed by the Justice

Department. (Table 2, above.)H.R. 3338, however, recommended significant

increases in a few non-defense areas:

Additional resources for New York – The House adopted an

amendment that represented the agreement reached on November 19

between Representative Walsh and the White House shifting $2.1

billion in the Committee-reported bill to meet the most urgent needs

of New York. (Since some of the shifted funds would have already

been allocated for needs in New York City, the net effect of the

Walsh amendment was to increase New York regional funding by

about $1.5 billion.) The cornerstone of the amendment was the

addition of $1.825 billion in HUD Community Development Block

Grants aid New York businesses recover from the terrorist attacks.

The amendment further added $175 million for worker

compensation processing and claims programs in New York state.

To accommodate these increases, the amendment eliminated $1.5

billion in Department of Labor National Emergency Grants to States

to aid dislocated workers nationally and cut FEMA debris removal

and reconstruction programs by $555 million.7

Bioterrorism spending would rise by nearly $600 million – to $2.16

billion – including a new $100 million initiative to support state and

local government preparedness planning. The House reduced

amounts for the National Pharmaceutical Stockpile by $50 million

based on savings negotiated for the costs of antibiotics to treat

individuals exposed to anthrax and other bacterial infections.

Counterterrorism aid to state and local governments under the

Justice Department’s Justice Assistance Program would receive

$400 million. The Administration had not requested these funds.

Aviation security would grow by $75 million in total above the

Administration’s request, including several new initiatives: $233

million for more Sky Marshals; $28.5 million for FAA security

demonstration projects; and $30 million for FAA hiring of “security

experts.” These additions were offset by a reduction from $300

The House rejected (201-220) an amendment by Representative George Miller that would

have restricted the use of the $1.825 billion in Community Development Block Grants to

extending unemployment benefits and health insurance for unemployed workers. Some

lawmakers were concerned that the transfer of funds from the Labor Department’s program

for dislocated workers to HUD’s community block grant program for New York would

adversely affect unemployed individuals throughout the United States. The Miller

amendment would have effectively reoriented the use of the $1.825 billion in Community

Development Block Grants to the purposes originally proposed for the Labor Department’s

grants for dislocated workers.

CRS-13

million to $50 million for aircraft cockpit door security. The House

Appropriations Committee believed that most funding for cockpit

security would not be needed until permanent door designs had been

developed, something that might not occur for 18 months.

In addition to other aviation security measures, passenger and

baggage screening activities would receive a $1.25 billion

appropriation, funds which would be fully offset by fees collected

from passengers and airlines that were authorized in P.L. 107-71, the

Aviation Security Act. H.R. 3338, as reported, provided $1 billion

for these purposes, an amount that was increased by $250 million

through a floor amendment by Representative Inslee.

The House-passed bill also proposed reductions to the President’s non-defense

request, including:

Dislocated workers assistance ($2 billion) was eliminated. (See

“Additional resources New York” above and footnote 7.) Prior to

the shift of these funds to economic development needs in New

York, the House Appropriation Committee had cut the request back

to $1.5 billion, noting that the President had pledged an extra $1

billion for National Emergency Grants to assist such workers in

FY2003, and that the House-passed Economic Stimulus bill (H.R.

3090) included $12.2 billion in additional funding to aid

unemployed persons with health benefit costs and states with costs

related to unemployment benefits.

FEMA grants of $550 million to states and localities for first

responder training and equipment were not included in H.R.

3338, as passed by the House. The House Committee said that a

grant program for first responders already existed in the Department

of Justice and that it was not necessary to establish a new program

in FEMA.

FEMA disaster relief aid was cut from $4.9 billion to $4.345

billion in order to increase funding for economic recovery in New

York.

Also during House floor consideration, two amendments by Representative Obey and

Representative Lowey, identical to proposals rejected in Committee markup for

additional funding for homeland security and New York, were offered but ruled out

of order.

More details on the actions taken by Congress in H.R. 3338 of non-defense

funding are shown in the tables attached to this report in the appendix.

House Consideration of the Defense Request. Although the House

provided the same amount as requested by the Administration for the Department of

Defense – $7.3 billion – H.R. 3338 shifted over $600 million in funding from the

allocation proposed by the Administration to reflect House priorities.

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Indicating its policy priorities, the House Appropriations Committee added

funds in the following areas:

$79 million for precision guided munitions;

$145 million for equipment for special operations forces;

$105 million for chemical-biological protection projects;

$40 million for the Former Soviet Union Threat Reduction

programs;

$163 million for spares and depot maintenance and medical

supplies;

$80 million for military construction projects; and

$25 million for initial crisis response.

The House Committee argued that these additions could be funded within the

Administration’s total by reducing funding in other parts of the Administration’s

request for DOD, either in the $1.67 billion already included in the regular FY2002

DOD bill, or in other allocations from the emergency supplemental.8

Senate Committee Markup of the $20 billion Terrorism Emergency

Supplemental. Like the House, the Senate Appropriations Committee considered

the $20 billion request as part of the Defense Appropriation bill. At markup on

December 4, the Committee reported legislation, adding $15 billion proposed by

Senator Byrd, Chairman of the Appropriations Committee. Half of the increased

spending targeted homeland security activities while the other half provided $7.5

billion in FEMA disaster relief grants for New York, Virginia, and Pennsylvania.

The Committee-reported bill approved the full amount ($7.3 billion) requested for

the Defense Department, and closely mirrored major elements of the non-defense

portion of the House-passed bill.

In addition to the $7.5 billion FEMA funding, intended mostly to help New

York, H.R. 3338, as reported by the Senate panel included significantly higher

amounts in several areas above those recommended by the President and what passed

the House earlier. Resources for bioterrorism were set at $3.8 billion, more than

twice as much as proposed by the Administration and 75% more than approved by

the House. Border security, especially along the northern boundary with Canada,

received nearly $600 million more than requested or passed in the House. The

Senate Committee recommendation further included $500 million more that

requested or House-passed levels for securing nuclear power plants and federal

facilities, including counter-proliferation measures to prevent theft of Russian nuclear

weapons and keep Russian nuclear specialists employed in appropriate jobs. H.R.

3338, as reported in the Senate, also added a new initiative of $875 million to assist

the Postal Service respond to anthrax and other terrorist attacks.

Senate Consideration of the Non-Defense Request. As the Senate

debate began on H.R. 3338, a number of Senators objected to the extra $15 billion

Additional funds are available to DOD to combat terrorism in the funds provided in earlier

allocations as executed transfers or in 15-day wait transfers (see Appendix). See also

discussion of Title IX in H.Rept. 107-298.

CRS-15

funding for homeland security and New York. In a procedural motion, the Senate

voted to remove the emergency designation for the additional $15 billion. By doing

so, the homeland security and New York funds were added to other non-emergency

funding in the bill. This pushed the total amount appropriated over the allowable

allocation for H.R. 3338 and made the entire Senate Committee recommendation

subject to a point of order.

Subsequently, the Senate adopted a compromise amendment offered by Senators

Byrd, Stevens, and Inouye that reduced the emergency anti-terrorism spending to $20

billion but retained many of the program spending priorities identified in the

Committee recommendation, although at lower amounts. As adopted by the Senate,

H.R. 3338 included sharp differences with levels proposed by the President and

approved by the House. Among the most significant disparities were the resource

shares recommended for defense, recovery efforts in New York and elsewhere, and

security of facilities and the border. The House measure, like the President’s request,

allocated 37% to defense while the Senate bill provided 10% of the $20 billion

appropriation. Debris removal, construction, and other recovery activities received

23% under the House version of the supplemental total, while the Senate proposed

a 32% share. Security of infrastructure, nuclear facilities, airports, and U.S. borders

accounted for roughly 10% of the House-passed bill, while the Senate allocated

nearly 16%. Other specific recommendations made by the Senate that differ from the

President and the House include:

Bioterrorism – $3 billion, nearly twice the amount recommended

by the White House and 41% more than approved in the House.

New York recovery – $5.82 billion in FEMA disaster relief aid

compared with $4.9 billion requested and $4.35 billion passed by the

House. Senate and House bills included $2 billion and $1.825

billion, respectively, for HUD Community Development Block

Grants. The White House had not proposed additional funds.

Border security – $842 million for the Immigration and

Naturalization Service and for Customs to enhance security,

especially along the norther border. The House approved $811

million and the President had proposed $507 million.

Aviation security – Senate and House bills provided roughly the

same amount for aviation security – about $500 million – but the

Senate measure allocated half to upgrade aircraft cockpit security

while the House bill emphasized resources for Sky Marshals and

security equipment for baggage and passenger screening. The

President had proposed $415 million for airline security, mostly to

upgrade cockpit doors.

Investigation and law enforcement – $2.4 billion, about double

what was requested and passed by the House. The Senate measure

added over $100 million for FBI investigative activities and included

$220 million for Justice Department law enforcement aid to New

Jersey, northern Virginia, and Maryland. Both House and Senate

CRS-16

bills included $400 million in counterterrorism assistance to state

and local governments that was not requested by the White House.

In order to provide these additional resources without exceeding the $20 billion total,

the Senate bill reduced DOD funding from $7.3 billion to $2 billion (see below).

Senate Consideration of the Defense Request. Under the Byrd,

Stevens, Inouye amendment that was adopted on the Senate floor, the Department of

Defense would have received $2 billion of the $20 billion included in the Senate bill,

a reduction of $5.3 billion from the funding included in the House bill and from the

Administration’s request. Of that $2 billion, $475 million was designated as military

construction funding to be used for reconstruction and renovation of the Pentagon.

The bill did not specify where the remaining $1.53 billion would be spent among the

categories developed by the Administration to describe DOD spending; those

categories range from funding for the Afghan conflict to increased funding of

intelligence and surveillance activities (see Table 3 below).

Under the President’s proposed allocations, the Defense Department would have

received a total of $21.1 billion, the largest share of both the total funding available

under the supplemental (53%) and of the $20 billion supplemental request considered

by Congress (37%). Under the Senate bill, however, DOD’s share of the $40 billion

was to total $15.7 billion or 39% of total supplemental funding, smaller than

proposed by the House or the Administration. Of that $15.7 billion, $13.7 billion

was already available to Defense from the first $20 billion allocated by the President;

the remaining $2 billion was in the Senate bill.9

Secretary of Defense Rumsfeld called on Congress to give DOD the entire $7.3

billion requested by the President in order to “maintain the president’s priorities for

fighting this war [in Afghanistan],” and to ensure that DOD would not need to curtail

training and operations.10 In floor debate, Senator Stevens suggested that the

Department of Defense had already received a large increase of over $42 billion

compared to the previous year, and that, under the emergency supplemental, the

President could submit requests for additional supplementals for any further

requirements to combat terrorism. Senator Stevens also mentioned that the

Department of Defense had authority under the Food and Forage Act (Section 3732

or Title 41 U.S.C. Section 11) to obligate monies in advance of appropriations for

emergency expenses.11 DOD also had already been allotted $3.6 billion for expenses

associated with the conflict in Afghanistan from the first $20 billion distributed by

the President (see Table 3 below).

Of that $13.7 billion, $5.6 billion was available immediately and $8.1 billion became

available on November 25, 2001 at the latest, 15 days after the President submitted the

proposed allocation to Congress.

National Journal’s Congress Daily, “House Democrats Demand More Funding for

Homeland,” December 11, 2001.

For Senator Steven’s statement, see Congressional Record, December 6, 2001, p. S12515.

The Department of Defense invoked its authority to use the Food and Forage Act on

September 16, 2001 but no obligations have been incurred by the services. DOD can also

transfer funds using reprogramming authority.

CRS-17

Table 3 shows the allocation of funds using the categories developed by the

Administration for the defense requests, ranging from support for the conflict in

Afghanistan to repair and renovation of the Pentagon, and compares the amounts

provided by the House, Senate, and the enacted bill with the Administration’s

request. Unlike submissions by other agencies and normal budget proposals, the

funding for DOD was appropriated to a central fund, the Defense Emergency

Response Fund, rather than to individual appropriation accounts in order to give

DOD additional flexibility and to ensure separate tracking of these emergency

funds.12 If necessary, DOD could, for example, transfer additional funds from one

category to “Worldwide Military Posture,” the category that provides monies for the

conflict in Afghanistan or for additional training (see Table 3 below).13

Conference Committee Consideration and Enactment of the $20

Billion Emergency Supplemental. On December 20, 2001, Congress cleared

for the White House H.R. 3338, including $20 billion in emergency supplemental

spending for homeland security, increased defense needs, and other efforts to combat

terrorism. The President signed the legislation on January 10, 2002 (P.L. 107-117).

The enacted package, however, differs significantly from what had been proposed in

mid-October for allocating the second $20 billion. The legislation roughly doubles

the request for bioterrorism, law enforcement, and infrastructure security activities,

while reducing by more than half the $7.3 billion proposed for defense. The final

compromise – to increase homeland security and New York aid and decrease defense

resources – partially accommodates the position of those who sought more spending

for domestic programs, but without exceeding $20 billion. (See Table 2 and Figure

6, above.)

Conference Agreement for Non-Defense Funds. P.L. 107-117 follows

much of the framework proposed by the Senate: transfer of defense resources to fund

homeland security and recovery needs. Major non-defense elements of the

conference agreement include:

Bioterrorism – $2.84 billion, nearly double the Administration’s

$1.59 billion request. The conference agreement includes $593

million for the National Pharmaceutical Stockpile and $512 million

for smallpox vaccine, both as requested, but adds $865 million for

the Center for Disease Control (CDC) to help state and local

jurisdictions upgrade their capacity. The National Institute of

Allergy and Infectious Diseases also receives $155 million for

bioterrorism research and the construction of biosafety labs,

activities that were not requested by the White House.

Recovery for New York and other affected areas – $8.2 billion,

slightly higher than the amount proposed by the President, but

In the enacted version of the bill, funds in the Defense Emergency Response Fund can be

transferred to the services for expenses incurred by other appropriations for the purposes of

the Emergency Terrorism Response supplemental, including emergency costs incurred

between September 11 and September 30, 2001, under the Food and Forage Act.

DOD would need to get approval from OMB for such transfers.

CRS-18

programmed in a way that more directly targets New York. H.R.

3338, as enacted, includes $2 billion in Community Development

Block Grants (funds that were not requested) to aid in New York

City economic recovery. FEMA receives $4.36 billion for various

reconstruction, repair, and clean-up activities, somewhat less than

the $4.9 billion requested. Funding (not requested) for reimbursing

hospitals affected by the attacks totals $140 million. The conference

agreement follows House- and Senate-passed bills by deleting the $2

billion request for Department of Labor National Emergency Grants

to States to assist dislocated workers and substituting $32 million

specifically for worker support organizations in New York City.

The House Appropriations Committee estimates that amounts

provided in P.L. 107-117 for recovery efforts in New York and other

jurisdictions, when combined with previously allocated funds, will

bring the total to $11.2 billion out of the entire $40 billion

supplemental.

Border security – $759 million, mostly for the Coast Guard and the

Immigration and Naturalization Service to upgrade border and port

security. The President had requested about $600 million. The

conference agreement includes $99.6 million for the INS, as

proposed by the Senate, for construction needs, especially along the

northern border.

Aviation security – $540 million, one-third higher than the $405

million requested. The conference agreement accommodates

differing priorities of House- and Senate-passed bills by including

$108.5 million for the accelerated purchase of airport security

equipment (House priority) and $100 million to upgrade aircraft

cockpit doors (Senate priority). P.L. 107-117, however, does not

include $1.25 billion as proposed by the House, for passenger and

baggage screening that would have been paid for by user fees

collected from passengers and airlines.

Counterterrorism aid – $2.1 billion, 75% more than the $1.2

billion request. The conference agreement includes $745 million for

the FBI, more than requested and passed by either the House or

Senate, and $400 million for counterterrorism aid to state and local

governments, as proposed in both bills but not in the request.

Postal Service assistance – $500 million to repair Postal Service

facilities destroyed in the attacks, protect workers handling the mail,

and establish a system to sanitize and screen the mail. The President

had not requested additional Postal Service funds beyond the $175

million allocated from the first $20 billion portion of the

supplemental.

Securing nuclear materials – $226 million, including $135 million

to secure nuclear materials at sites in Russia and other former Soviet

CRS-19

states, and for nonproliferation programs aimed at retaining Russian

nuclear scientists.

Conference Agreement for Defense Funds. To accommodate higher

funding for non-defense needs, P.L. 107-117 cuts the amount requested by the

President for Defense from $7.3 billion to $3.5 billion. Although particular

categories of defense spending to combat terrorism are reduced, the Administration’s

overall programmatic priorities for DOD remain intact. Congress was also able to

provide funding from other sources to offset the cuts (see discussion above and

Table 3 below). The Administration has also signaled that it plans to request

additional emergency funding for Defense later this winter.14 The major changes to

the request are:

halving the funding for “increased situational awareness”

(intelligence and surveillance activities) from $1.74 billion to $850

million;

eliminating $881 million in funding for “enhanced force protection”

(self-protection systems for weapons and protection to DOD

facilities), offset in part by an increase of $478 million provided in

the regular FY2002 DOD appropriations for similar activities;

eliminating $219 million in funding for improved command and

control;

halving the funding for “increased worldwide posture” (funding for

the Afghan war and DOD’s homeland defense activities) from $2.9

billion to $1.45 billion, although up to $1.64 billion can be

transferred to those activities from regular FY2002 appropriations

for RDT&E and procurement should it prove necessary (see

discussion above);

decreasing funding for “offensive counter-terrorism” (munitions)

from $545 million to $372 million;

decreasing funding for “initial crisis response” from $106 million to

$39 million;

reducing funding for repair and upgrade of the Pentagon from $925

million to $640 million, offset by a transfer of $300 million

remaining in the emergency supplemental but not yet allocated by

the President; and

an increase of $104 million for military construction projects.

James Dao, “Pentagon Seeking a large increase in its next budget, “ New York Times,

January 7, 2002.

CRS-20

To track the expenditure of these funds, Congress requires DOD to provide

quarterly reports to the defense committees showing the appropriation accounts

where funds have been transferred, obligations of those funds, and a forecast of

expenditures. Because DOD’s funding is being provided in these unique and fairly

general categories, the reports are to be more detailed, showing spending by project,

and by categories for military personnel and operation and maintenance spending that

have been used to report previous contingency operations. The reports are also to

identify offsetting savings due to cancellation of peacetime training or other

activities. The first report is due February 25, 2002, 45 days after enactment, and

quarterly thereafter.15

Table 3. Congressional Action on DOD’s Share of $20 Billion

Supplemental

As of December 20, 2001

In millions of dollars