May 24, 2012

International Affairs Budget Update, 5-24-12

This morning the Senate Appropriations Committee approved its FY13 State-Foreign Operations Appropriations Bill, following Subcommittee approval on Tuesday.

As detailed below, the Senate bill provides much-needed robust funding levels for many accounts, including development, humanitarian, and multilateral assistance and the new Middle East and North Africa Incentive Fund (MENA-IF).  All of these accounts are funded at levels above current funding.  However, the bill contains deep cuts of over 50% for operations and assistance to the Frontline States of Afghanistan, Pakistan, and Iraq.  These steep reductions will likely raise deep concerns for the Administration and ongoing efforts to build civilian capacity in those countries as the military withdraws.

Taken together, the Senate bill has significantly different funding priorities than the House bill, which will ensure challenging conference negotiations later this year with the House.  For many accounts, splitting the difference between Senate and House proposals – as appropriators often do – would still set funding above current levels and, in some cases, higher than the Administration requested.  However, such a positive outcome will hinge fundamentally on Congress agreeing to the Senate discretionary spending level of $1.047 trillion, as set in the Budget Control Act, rather than the $1.028 trillion cap imposed by the House.

Bill Highlights

The $52.1 billion measure, including $49.8 billion for base funding and $2.3 billion for Overseas Contingency Operations (OCO), represents a $4 billion increase over the House bill but falls $1.2 billion below the FY12 level, largely because the Subcommittee chose not to use $881 million of its OCO allocation approved earlier by the Committee.

Programs receiving significant increases include Development Assistance, the Peace Corps, Migration and Refugee Assistance, and International Organizations and Programs (IO&P), while Global Health programs are increased slightly.  As a result of the deep cuts to funding for Frontline States, Diplomatic and Consular Programs for the State Department, as well as several security assistance accounts – including International Narcotics Control and Law Enforcement (INCLE), Foreign Military Financing (FMF), and the Pakistan Counterinsurgency Capability Fund (PCCF) – were cut significantly.

A full summary of the bill is found below. The bill and Committee report are also available.

Markup Details

The Senate Appropriations Committee approved the measure this morning by a vote of 29-1, following the Subcommittee’s approval on Tuesday. Senator Ron Johnson (R-WI) was the lone vote against the bill.  At the outset of today’s markup, Committee Chairman Daniel Inouye (D-HI) stated that the bill is “a critical element in our nation’s security policy.” Subcommittee Ranking Member Lindsey Graham (R-SC) noted that “it’s a dangerous world, and America can’t afford to retreat from the world.”

During the markup, adopted amendments included a Lautenberg (D-NJ) amendment permanently eliminating the Mexico City Policy, or Global Gag Rule, (approved 18-12), as well as unanimous approval of a Graham amendment reducing foreign military financing funding for Pakistan by $33 million.  A Kirk (R-IL)-Blunt (R-MO) amendment requiring the State Department to issue a report on who benefits from funding to the UN Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) was adopted by voice vote.

Next Steps

Floor action on the State-Foreign Operations has not been scheduled in ether the House or Senate.  While the schedule remains fluid, there is a strong chance that the bill will not be taken up by either chamber.  However, all USGLC members should remain on alert and be ready to mobilize their networks in anticipation of possible floor action and consideration of many harmful cutting amendments.  Check out our Action Center for all the tools you’ll need for mobilization.

Summary of the Senate’s FY13 State-Foreign Operations Bill

  • Operations for State Department Cut Sharply: The Senate bill cuts funding for State Department operations dramatically, but with the reductions focused almost entirely on Afghanistan (22.5% below the request) and Iraq (83% less than the request).  The Committee notes that large amounts of prior year appropriations remain available to carry over into FY13 and will adequately cover necessary State Department expenses.  On a more positive note, for all other global State Department operations the Committee provides about $250 million more than the Administration’s request.  Operation expenses for USAID increase slightly (3%) compared to current spending and are 9% higher than the House bill.
  • Fully Funds Administration’s New Initiative to Respond to Arab Spring:  The Senate bill provides $1 billion in funding for the new MENA-IF, $330 million (33%) more than was requested.  As one of a very few new initiatives for FY13, the Fund is intended to serve as an additional foreign policy tool in responding to continuing turbulence and opportunities for democratic reform in the region.  The House bill denied the President’s $770 million request for the new fund, but does provide a more modest $200 million for a “Middle East Response” and allows reprogramming of funds for MENA-IF purposes.
  • Development Assistance Programs Increased:  The Development Assistance account – through which most bilateral aid to low-income countries flows for agriculture education, water and sanitation, microenterprise, and the environment – receives $3.1 billion, 23% ($600 million) above current spending and the House bill.
    • One of the Administration’s signature initiatives – Feed the Future – receives much of its funding within Development Assistance.  The Committee provides $1.2 billion for the initiative, $1 billion for bilateral programs (as requested) and $200 million for the multilateral Global Agriculture Food Security Program (GAFSP), $66 million higher than requested.
    • The Senate bill further provides $800 million for basic education, $350 million for clean water sanitation, and $1.15 billion for environment and energy programs.
  • Global Health Slight Increase:  Overall, Global Health levels are increased by 3% from current spending and 5% above the House bill.  Funding for specific sectors are flat-funded or increased compared to current levels, including:
    • $1.65 billion contribution to the Global Fund to Fight AIDS, Tuberculosis and Malaria (Global Fund), $300 million above the House level and at the amount requested;
    • $285 million for tuberculosis;
    • $670 million for malaria, $20 million above current funding;
    • $679 million for maternal and child health;
    • $700 million for family planning and reproductive health across all accounts, almost $250 million above the $461 million cap the House bill placed on family planning funding;
    • $125 million for neglected tropical diseases;
    • $75 million for pandemic influenza and other emerging threats, a 42% increase from FY12; and
    • $44.5 million for the UN Population Fund (UNFPA), nearly $10 million more than FY12 and in sharp contrast with the House bill which provides no funding.
  • Democracy Aid Receives Substantial Increase:  Two accounts specifically aimed at promoting democracy globally grow significantly under the Senate measure.  The National Endowment for Democracy receives $236 million, roughly double current spending and $132 million above the request.  The Committee sets the Democracy Fund account at $230 million, more than twice the amount provided for FY12.  Overall, the Senate measure directs that $2.61 billion be available for democracy programs.  The House bill provides $2.84 billion for these purposes.
  • Multilateral Assistance and International Organizations Significantly Higher than House: The bill provides $3.3 billion for multilateral assistance, including $3 billion for international financial institutions.  This represents a 20% increase over current spending and a 58% increase over the House bill, and would include payment for arrears to the World Bank.
    • The Senate provides $300 million for the International Clean Technology Fund and $100 million for the International Strategic Climate Fund, both fully denied in the House bill.
    • Voluntary contributions to international organizations would increase by 7% compared to FY12 and 35% compared to the House.
  • Humanitarian Aid Receives Notable Increase:  The combined funding for USAID disaster assistance and State Department refugee programs – $3.65 billion – represents a 27% increase from current levels and a 38% increase compared to the House bill.  The other major humanitarian account – food aid – received $1.65 billion in the Agriculture Appropriation, a bill not yet released by the House Committee.
  • Security Assistance Decreased:  In contrast to many other areas of the bill, several security assistance accounts are cut significantly from current levels and in stark contrast to the House bill.  Much of these cuts fall on Afghanistan, Pakistan, and Iraq.  Like with State Department operations, the Committee notes that there are large unobligated balances for assistance programs that are available for FY13.  In total, the bill cuts security assistance to Pakistan by 62% from the FY13 request and by 69% to Iraq.
    • For the two largest security assistance accounts – Foreign Military Financing (FMF) and International Narcotics and Law Enforcement (INCLE) – the Senate Committee sets FMF funding 8% below FY12 levels and INCLE 27% below current spending.  As in the House bill, FMF for Israel ($3.1 billion), Egypt ($1.3 billion, with conditions), and Jordan ($300 million) are fully funded.
    • The Senate bill provides $391.1 million for peacekeeping operations, 2% above current spending and 13% above the House bill, and includes funding for expanded peacekeeping operations in Somalia.
    • Funding is provided for two security assistance accounts denied in the House bill.  As noted above, only $50 million is provided for PCCF, 94% below the $800 million request. The Committee also provides $25 million requested State Department share for the recently established joint State-DOD program, the Global Security Contingency Fund.
  • Impact on Other Selected Accounts
    • Millennium Challenge Corporation (MCC): $898 million, the same as FY12.
    • Contributions for International Peacekeeping Activities increase 10% from current amounts.  This remains $92 million below the request, although an additional $142 million is provided within the Peacekeeping Operations account for assessed payments for operations in Somalia.
    • U.S. Institute of Peace (USIP): $38 million, 3% below current spending but 3% above the House bill and President’s request.
    • Asia Foundation, East-West Center, Inter-American Foundation, and African Development Foundation: funding for each is set at FY12 amounts or slightly above current levels.
    • Peace Corps: $400 million, 7% ($25 million) above current levels, the President’s request, and the House bill.
    • Debt relief for Sudan:  The bill does not provide direct funding for Sudan debt cancellation but it allows the transfer of $250 million from the Economic Support Fund.
    • U.S. Trade Development Agency (TDA): $58 million, 16% above current spending and the House bill, and equal to the President’s request.
    • Economic Support Fund (ESF): $5.1 billion (combined core and OCO), 12% less than FY12 and 2% below the House bill.  While the bill provides funding for Egypt ($250 million) and Jordan ($410 million), it is unclear which countries would be cut, although Afghanistan and Pakistan are possibilities. 

FY13 International Affairs Budget Snapshot* 
(As of 5/24/12)

International Affairs 150 Account* 

FY13 Senate $53.83 billion
            of which OCO              $2.29 billion 
FY13 House N/A**
            of which OCO             $8.2 billion 
FY13 Request $56.24 billion
            of which OCO              $8.2 billion 
FY12 Enacted $54.94 billion
            of which OCO             $11.2 billion 

Foreign Operations Account 

FY13 Senate $36.01 billion
            of which OCO              $0.71 billion 
FY13 House $32.72 billion
            of which OCO             $5.36 billion
FY13 Request $36.07 billion
            of which OCO             $3.88 billion 
FY12 Enacted $35.52 billion
            of which OCO             $6.58 billion 

State Department Operations & Related Accounts 

FY13 Senate $16.08 billion
            of which OCO              $1.53 billion 
FY13 House $15.52 billion
            of which OCO             $2.89 billion
FY13 Request $18.51 billion
            of which OCO             $4.36 billion 
FY12 Enacted $17.69 billion
            of which OCO             $4.62 billion 

International Agriculture Programs 

FY13 Senate $1.65 billion
FY13 House $N/A**
FY13 Request $1.58 billion
FY12 Enacted $1.65 billion

* International Affairs totals also include about $85 million appropriated in the Treasury spending bill for the International Trade Commission and the Foreign Claims Settlement Commission.  These amounts are included in the totals shown here.

** Funding levels for international food aid programs, provided by the Agriculture Appropriations bill, have not yet been released.  As such, a precise calculation for the total House FY13 International Affairs Budget is not available.