prompt_front: You are given two reports by the government agency.



Question: Write a one-page summary of the report 1.

Report 1: CAPTA, originally enacted in 1974, provides formula grants to states to improve child protective service systems  ACF administers the CAPTA state grant program and provides guidance and oversight to states  In fiscal year 2017, Congress provided about $25 million for the program  As part of the CAPTA state grant program, states are required to submit to the Secretary of HHS plans outlining how they intend to use CAPTA funds to improve their child protective service systems, among other things  State plans remain in effect for the duration of states’ participation in the grant program; if modifications are needed, these must be submitted  In addition to state plans, states are required to submit to HHS an annual data report providing information on agency decisions made in response to referrals of child abuse and neglect, as well as preventive services provided to families, among other things  CAPTA requires state governors to provide a series of assurances in their state plans  Since 2003, governors have had to provide an assurance that states have in effect and are enforcing a state law or program that includes policies and procedures to address the needs of infants affected by prenatal substance abuse or displaying withdrawal symptoms at birth  Under states’ policies and procedures, health care providers are required to notify CPS of such infants  Governors must also assure that a plan of safe care is developed for these infants  Although CAPTA does not define “plans of safe care,” for the purposes of this report we define them as plans to ensure the safety and well-being of infants who are born substance-affected  The Comprehensive Addiction and Recovery Act of 2016 (CARA) amended certain provisions of CAPTA that relate to substance-affected infants (see table 1)  In addition to provisions related to substance-affected infants, CAPTA also requires governors to provide an assurance to the Secretary of HHS that they have provisions or procedures for certain individuals to report known and suspected instances of child abuse and neglect, which are generally referred to as mandated reporter laws  All states have statutes identifying persons who are required to report suspected child maltreatment to an appropriate agency, such as child protective services, a law enforcement agency, or a state’s toll-free child abuse reporting hotline, according to a 2016 HHS report  Mandatory reporters often include social workers; teachers, principals, and other school personnel; physicians, nurses, and other health care workers; and counselors, therapists, and other mental health professionals  The circumstances under which a mandatory reporter must make a report vary from state to state, according to HHS  Typically, a report must be made when the reporter, in his or her official capacity, suspects or has reason to believe that a child has been abused or neglected  State laws require mandatory reporters to report the facts and circumstances that led them to suspect that a child has been abused or neglected; they do not have the burden of providing proof that abuse or neglect has occurred  CPS, a division within state and local social services, is generally the agency that conducts an initial assessment or investigation of reports of child abuse and neglect  It also offers services to families and children where maltreatment has occurred or is likely to occur  Typically, when CPS agencies receive a notification about suspected child abuse, including a substance-affected infant, social workers review the referral to determine if it should be accepted for investigation  During an investigation, social workers determine, among other things, the nature, extent, and cause of abuse or neglect, and identify the person responsible for the maltreatment  An investigation may include the following: a visit to the hospital and/or infant’s home; observation of the infant; risk and safety assessments; evaluation of the home environment; background checks, including criminal record checks of adults that reside with the family; as well as mental health evaluations  If social workers determine that there is enough evidence to suggest that an infant is at risk for harm or neglect, or that abuse or neglect occurred, the case is substantiated  Once a case is substantiated, CPS develops a case plan with the family outlining objectives and tasks for the family  Among other things, CPS may refer the family to services in the community, such as early intervention services, parenting classes, and substance abuse treatment  Generally, CPS attempts to strengthen the family and alleviate the problems which led to maltreatment  If the case is not substantiated, but there is genuine concern about the child’s situation and the family may benefit from services in the community, the case may be closed and/or the family may be referred for voluntary services (see figure 1)  Prenatal maternal opioid use has increased considerably in recent years  This increase has contributed to a significant rise in the rate of NAS  According to a recent study, the rate of NAS has increased from 1 2 per 1,000 hospital births in 2000 to 5 8 per 1,000 hospital births in 2012, reaching a total of 21,732 infants diagnosed with NAS  NAS occurs with considerable variability  According to a recent HHS report, various studies indicate that anywhere from 55 to 94 percent of infants exposed to opioids in-utero exhibit some degree of symptoms  Typically, infants with NAS develop symptoms within 72 hours of birth, but may develop symptoms within the first 2 weeks of life, including after hospital discharge  For the purpose of this report, infants exposed to opioids ingested by mothers in utero are considered substance-exposed, and those born negatively affected by exposure or experiencing withdrawal symptoms are considered substance-affected  According to experts, NAS is considered an expected and treatable result of women’s prenatal opioid use  Opioid exposure during pregnancy may occur for the following reasons: Women receiving pain medication with a prescription under the care of a physician  Medications can include fentanyl and oxycodone  Women under the care of a physician and undergoing treatment for an opioid use disorder with medications, such as methadone or buprenorphine  This type of treatment is generally referred to as medication-assisted treatment (MAT)  Women misusing opioid pain medications with or without a prescription (such as using without a prescription, using a different dosage than prescribed, or continuing to use a drug when no longer needed for pain)  Women using or abusing illicit opioid, such as heroin  In response to our survey, 42 states reported that state policies and procedures require health care providers to notify CPS about substance- affected infants  Some states reported that they explicitly require health care providers to notify CPS of substance-affected infants  For example, Wisconsin reported that under its state law if tests indicate that infants have controlled substances or controlled substance analogs in their bodily fluids, the health care provider shall report the occurrence of that condition to CPS  Others reported that the requirement is met by their states’ mandated reporter law—whereby people in certain positions, including health care providers, are required to notify CPS about substance-affected infants, similar to the manner in which other mandatory reporters, like school teachers, day care personnel, and social workers are required to report other instances of child abuse and neglect  For example, Kentucky statute requires that “any person who knows or has reasonable cause to believe that a child is dependent, neglected, or abused shall immediately” make a report to the police or CPS  The statutory definition for an abused or neglected child in Kentucky includes situations where a child’s health or welfare is harmed or threatened with harm because of parental incapacity due to alcohol and other drug abuse  Of the 42 states that require health care providers to notify CPS of substance-affected infants, 21 reported that notification is required for infants affected by both illegal and legal use of opioids  For example, in Massachusetts health care providers are required to notify CPS orally and, in writing within 48 hours, about substance-affected infants physically dependent on drugs, even if the drugs were legally obtained and the mother is under the care of a prescribing medical professional  Sixteen of the 42 states reported that health care providers are required to notify CPS of infants affected only by the illegal use of opioids, and five of the 42 states reported that they did not know if health care providers were required to notify CPS of infants affected by the illegal and legal use of opioids  The other eight states reported that although they did not have policies and procedures that require health care providers to notify CPS about substance-affected infants, they have laws or policies that encourage notification  Specifically, in written responses to our survey: Two states reported that under their state mandated reporter laws health care providers are encouraged, but not required, to notify CPS about substance-affected infants  Four states reported that they are working to amend their states’ policies and procedures to require that health care providers refer substance-affected infants to CPS  Another state reported that it encourages the notification from health care providers, but has not sought legislation to require health care providers to report substance-affected infants to CPS because of concerns that any laws that criminalize prenatal substance use would further deter substance-using pregnant women from seeking prenatal care  The state’s law requires all hospital personnel who suspect abuse and neglect or observe conditions that are likely to result in abuse or neglect to notify CPS  One state reported that all persons, including health care providers, are required to report child abuse and neglect, but reporting depends on whether a hospital’s policy indicates substance abuse is child abuse or neglect  Further, the state CPS director reported collaboration with the health care community on reporting substance exposed infants to its child abuse hotline  Although one state reported in our survey that it does not require or encourage health care providers to notify CPS about substance-affected infants, in an interview, state officials explained that its policy requires that health care providers notify CPS if, through an assessment, they conclude that infants are at risk for abuse and neglect  Under the state’s law, health care providers in each county are required to assess the needs of mothers and substance-affected infants using a protocol established by county health departments, CPS agencies, and hospitals  State officials told us that under the state’s law, the birth of a substance- affected infant is not in and of itself a sufficient basis for reporting child abuse or neglect  In addition to having policies and procedures regarding the reporting of substance-affected infants, in written responses to our survey some states reported providing training and guidance to support the efforts of health care providers to notify CPS about these infants  Three states reported that they offer mandatory reporter training to inform health care providers that they are obligated to notify CPS about substance-affected infants  Another state reported that its Department of Human Services developed a guide for mandated reporters that discusses what needs to be reported and where to make reports  Also, one state reported that it sent a formal letter to its state hospital association about how to report substance-affected infants to CPS  This state also sent a memo to its CPS county directors instructing them to contact their local health care providers on the importance of reporting substance-affected infants to CPS and the process for doing so  In addition, during our Massachusetts site visit, officials shared with us a memo that was sent to mandated reporters, community partners, and other stakeholders that offered guidance on when to file a report about substance-exposed infants  Further, local CPS staff at one Massachusetts field office told us that upon request they provide mandated reporter training to health care providers  Despite these policies, procedures, and guidance, in written responses to our survey, a few states reported concerns about requiring health care providers to notify CPS about substance-affected infants and the definition of substance-affected  All of the hospitals that we visited have policies consistent with their state’s law that require that health care providers, primarily hospital social workers, to notify CPS about substance-affected infants  However, one state reported that some medical personnel have been reluctant to report some infants that are positive for illegal and legal substances due to fears of mothers being arrested  Another state reported that stakeholders are concerned that having to notify CPS about substance-affected infants will have a chilling effect on the willingness of pregnant women who use substances to be honest with providers and seek the help and support they need and deserve  According to one state, there is often an inherent resistance to contacting CPS in these cases as health care providers tend to view child welfare involvement as punitive rather than a potential resource for the family  In addition, three states reported in written responses to our survey challenges understanding how to define terms, such as substance- affected, under CAPTA  For example, the Pennsylvania CPS director expressed concerns during our site visit, suggesting that CAPTA raises many unanswered questions, such as (1) if “affected by substances” means at-risk of being or physically affected by substances, (2) what policies relating to substance-affected infants should look like and include, and (3) whether “affected by substances” should include women who are under the care of health care or treatment providers and taking their medications as prescribed  A Kentucky public health official told us that a drug test, or whether the infant is affected by legal or illegal substances, should not be the sole factor in determining CPS’ involvement with a family  Rather, a holistic view of the family, whether the substance prohibits the mother’s ability to care for her child, and any risk factors present that places the infant at risk should also be considered  According to officials, an infant that is exposed to substances, but has not been affected by the substance, can still be at risk for child abuse and neglect  In response to our survey, 46 states reported that they have policies and procedures for deciding which notifications about substance-affected infants are accepted for investigation  Seventeen of those states reported that all notifications of substance-affected infants are accepted for investigation, regardless of the circumstances  The remaining 29 states reported that they apply specific criteria to determine if children who present as substance-affected are accepted for investigation by CPS  Several states reported in written responses to our survey that they base their criteria for accepting notifications on the infant’s safety  For these states, drug exposure does not by itself indicate that an infant’s safety is at risk  For example, one state explained that in determining a child’s safety risk, staff evaluate a number of factors including the history of the family; the family’s presentation at the birthing hospital (appearance of chaotic behavior, suspected intoxication of adults, lack of appropriate concern or bonding with the infant); the presentation of the infant’s physical condition; the results of any testing of parent or child (blood, urine, etc ); discrepancies identified in the parent’s representation of their substance use or substance use treatment; and any other concerns noted by the reporting source  Other states reported that their criteria for accepting notifications for investigation are based on the degree or type of drug exposure in question  For example, one state reported that its policy directs CPS agencies to accept notifications for investigation when a parent has used illegal substances or non-medical use of prescribed medication during the last trimester of pregnancy  Another state reported that it will accept notifications for investigation if the infant is born with a positive toxicology or is experiencing drug withdrawal, or if the mother tests positive for substances  A few states reported using both risk to the safety of infants as well as degree or type of drug as their criteria for accepting notifications  For example, one state reported that it considers factors, such as the type of drug, the parent’s ability to care for the child, addiction history, and the parent’s readiness and preparation to care for the infant  In follow-up correspondences with states that reported that they do not have policies and procedures to decide whether to accept for investigation notices about substance-affected infants, one state reported that decisions are made on a case-by-case basis  A few states reported that after receiving notifications about substance- affected infants, CPS agencies may decide to opt out of investigating some families, referred to as “screening out” families  For example, in Massachusetts, CPS can “screen out” referrals of mothers if the only substance affecting the infants was used by the mothers as prescribed by their physician  In these instances, when CPS in Massachusetts is notified by the hospital about an infant, the screener gathers information from the caller and consults with a supervisor to determine whether the referral should be accepted for investigation or screened out  If the mother is on methadone, for example, but is involved with services and is in a treatment plan, CPS verifies with medical or other qualified providers that the mother used the drug as part of substance abuse or medical treatment as authorized  Additionally, CPS confirms that there are no other concerns of child abuse and/or neglect  If CPS officials in Massachusetts are unable to collect all the information that they need to screen out families, for example when a mother does not sign a release allowing CPS officials to speak with her health care providers, notifications about substance-affected infants are accepted for investigation  In response to our survey, 49 states reported that their CPS agency has policies to develop a plan to ensure the safety and well-being of substance-affected infants who meet the state’s criteria for investigation  Two states reported that CPS staff are not required to develop such a plan, even if a notification is accepted for an investigation or an assessment  For purposes of this report, we are defining a plan of safe care as a plan to ensure the safety and well-being of the infant  States’ approaches to identifying children and families who will receive a plan of safe care generally fall into two categories: 38 states reported that CPS is required to develop a plan of safe care for all notifications of substance-affected infants that are accepted for investigation, including those that are not substantiated  11 states reported that CPS staff are required to develop a plan of safe care only in those instances where an investigation substantiates the notification or uncovers an unmet need or present or emerging danger  For example, local Pennsylvania CPS officials told us that they only develop plans when there is a safety threat or other concern about the infant  Most states reported that after a notification of a substance-affected infant is accepted for investigation, CPS always conducts a needs assessment for the infant and caregivers  For example, one local CPS office that we visited told us that social workers assess risk to and safety of infants, their function (development, age appropriate behavior, etc ), and environment  In addition, workers assess the caregiver’s ability to parent and employment status, as well as housing  The assessments conducted as part of the investigation inform the development of plans of safe care, as well as decisions about the removal of infants from the home  Among the 49 states that reported that plans of safe care are developed for all or some substance-affected infants, 47 reported that these plans either always or sometimes address infants’ safety needs  Plans also address other needs, such as infants’ immediate medical and longer-term developmental needs, as well as caregiver’s substance use treatment needs  See figure 2 for the number of states whose plans of safe care address various issues facing the infant and parent  In written responses to our survey and during our site visits, officials reported that plans of safe care and referrals for services included in the plans are individualized based on the infant and family’s needs  For example, Massachusetts state CPS officials told us that plans of safe care are developed for each family based on the information that staff collect from the safety, risk, and family assessments, as well as information collected from individuals who may have knowledge that would inform the family assessments, such as medical and treatment providers, and family members  Kentucky state CPS officials told us that the local organizations and service providers that they collaborate with to develop the plan of safe care also vary based on the family’s needs  For example, Kentucky will only collaborate with substance use treatment providers to develop the plan of safe care when families have substance use disorders  Similarly, during our site visits, officials from two states told us that the decision to place an infant in foster care is based on the individualized needs of the infant and caregiver  For example, Massachusetts state officials told us that their decision to remove a baby from the home depends on a myriad of factors and is determined on a case-by-case basis  Officials explained that if a mother is discharged from the hospital and begins using drugs again and does not have adequate supports in place to care for her baby, CPS may decide to place the infant in foster care  However, if a mother has existing support systems in place to mitigate safety risks, CPS may decide to keep the baby in the home  In our survey, all 51 states reported that their agencies either always or sometimes refer parents or caregivers to substance use treatment programs, and most states reported that they always or sometimes refer parents or caregivers to parenting classes or programs (49), and other supportive services (49)  CPS officials in each of the three states that we visited told us that their plans of safe care include referrals to address not only the immediate needs of the infants, but also the needs of the parent or caregiver  For example, officials from a local Kentucky CPS agency told us that staff refer mothers of substance-exposed infants to a program called Sobriety Treatment and Recovery Team (START)  START is comprised of a social worker and a peer support mentor who has at least 3 years of sobriety, previous involvement with CPS, and was successfully able to regain or keep custody of her own children  According to officials, the START program has been able to provide participants with quick access to substance use disorder treatment  Officials from a Massachusetts local CPS agency told us that one of the services that they provide to parents of substance-affected infants is a parent aide who can help monitor how the parent is caring for the infant, such as administering the infant’s medications appropriately and ensuring the parent is not abusing the infant’s drugs  In addition, a parent aide can provide emotional support and help parents adjust after the infant is discharged from the hospital  Kentucky officials noted the effect that a healthy caregiver has on the outcome of the infant and emphasized that a baby cannot be healthy if the mother is not  Kentucky CPS officials said that they have found that the earlier caregivers enter treatment, the better the outcomes are for mothers and babies  According to Kentucky officials, parents who participate in the START program are less likely to have their child placed in foster care  Officials from the states that we visited told us that developing and monitoring plans of safe care under CAPTA’s new requirements for infants affected by their mother’s legal use of prescribed medications, as well as plans for these infants’ caregivers, present challenges  Specifically, officials reported concerns about increased caseloads, particularly if they are required to provide plans and services for infants at low risk of abuse or neglect, the content of plans, and confidentiality restrictions  Thirty-one of 50 states reported on our survey that staffing or resource limitations was very or extremely challenging, and CPS officials across the 3 states we visited said that the opioid epidemic has directly contributed to increased caseloads  According to a local Kentucky CPS office, the number of babies that met criteria for being accepted for investigation has increased about 55 percent from 2011 to 2016, while the number of staff has remained the same  Similarly, hospitals reported being impacted by this challenge  For example, staff at four hospitals we visited told us that they have delayed discharging infants from the hospital because CPS social workers did not identify caregivers to whom infants may be released or make plans for infants in a timely manner  In addition, staff from three hospitals told us that some CPS workers are difficult to contact and not especially responsive to their questions  One hospital social worker told us that she is concerned that the changes to CAPTA that require notifying CPS of all substance-affected newborns will inundate the agencies with cases  Officials from two of the three states we visited anticipated that providing services to infants affected by the legal use of prescribed medications, but not likely to be at risk for child abuse and neglect, will result in an increase in the number of families referred to CPS  This, in turn, will require a plan of safe care and further strain limited resources  Twenty- five states reported in our survey that the plan they develop for substance-affected infants is the same as for other children in CPS care, suggesting that states devote the same level of resources to these infants as other cases  The states we visited interpret CAPTA to require that plans of safe care be developed for all substance-affected infants who are referred to CPS, including those who may not meet usual criteria to be accepted for an investigation  Some state officials we interviewed questioned whether the new CAPTA requirements would allow for the best use of limited resources  For example, one senior state CPS official questioned whether it would be a good use of resources to develop plans of safe care for mothers in substance use disorder treatment or mothers using opioid medications due to chronic pain  A local CPS official we interviewed stated that drug exposure, in and of itself, is not necessarily a safety risk, and CPS should not intervene with families who are not at risk for child abuse or neglect  Instead, hospitals or treatment providers should intervene and refer families who do not meet criteria for CPS involvement, but could benefit from additional supports, to voluntary services  Kentucky public health officials told us that the period after a woman gives birth is a critical time for families as mothers may be stressed, sleep-deprived, exhausted, and may have other children in the home  This period may be especially challenging for mothers with substance use disorders, if adequate supports are not in place  According to officials women are typically covered for substance use treatment during pregnancy; however, this coverage ends roughly 60 days after the baby is born  In written responses to our survey, some states reported that they would rely on other agencies to develop plans of safe care  Similarly, in order to manage limited CPS resources, officials from two of the three states that we visited said they are considering having hospitals or other agencies assume responsibility for developing plans of safe care when there is no evidence of abuse or neglect and there appears to be minimal risk to the safety and well-being of the infant  Kentucky officials told us that they envision that CPS will be responsible for developing a plan of safe care for notifications that are accepted for investigation, while hospitals, or another agency, will be responsible for developing plans of safe care for referrals that are screened out by CPS  According to CPS state officials, the plan of safe care for the infant and the family can be part of the discharge plan prior to the family leaving the hospital  However, officials reported that obtaining cooperation from other agencies may be difficult


Report 2:  Some state officials reported being concerned that other agencies may not feel obligated to develop these plans, in part, because CAPTA provides funding to child welfare, and other agencies may therefore believe that child welfare should be responsible for developing the plan of safe care  CPS officials we interviewed in two of our site visit states, as well as one state we followed up with, told us that they were unsure of whether their current plans will meet new CAPTA requirements because CAPTA does not define a plan of safe care  For example, Massachusetts officials said that their plans include everything that a family might need to ensure the safety of the child, including resources to ensure stabilization and reunification of a family, but they are not sure whether the plans meet new CAPTA requirements, in part because they are not familiar with the term “plan of safe care ” An official in another state was also unsure about whether his state’s “safety plans” would meet CAPTA requirements  According to the official, safety plans may include a treatment plan for mothers, and referral services, such as early intervention for the child  In practice, plans of safe care generally address gaps that place an infant at risk for harm or neglect  However, state officials we interviewed reported being unsure about what a plan of safe care should look like for families where these gaps do not exist  Also, in a written response to our survey, one state expressed uncertainty about CPS’ role if required to work with infants who do not typically receive CPS services  For example, a Pennsylvania official said that it is unclear what types of interventions child welfare should conduct with families of infants exposed to legal substances, such as medications prescribed by doctors, when the caregivers are taking their medications correctly  Similarly, officials also questioned whether a plan would be necessary, and what the plan would entail, for caregivers who are already addressing their substance use disorder and taking steps to ensure their infant’s safety  Officials from a local Kentucky CPS office described a case in which a mother was participating in medication-assisted treatment, had attended counseling three times per week throughout her pregnancy, and was continuing treatment in the postpartum period  Through CPS’ investigation, the agency found that the case was not substantiated, in part, because there were no additional services that CPS could connect her with that she was not already receiving  Officials across the three states we visited also said that state and federal drug and alcohol confidentiality restrictions may challenge their ability to monitor plans of safe care  To monitor plans of safe care, CPS staff may need access to confidential information in order to know how caregivers are progressing in treatment, particularly now that these plans must address the substance use disorder needs of the caregiver  However, federal law restricts the disclosure and use of alcohol and drug patient records maintained in connection with the performance of any federal- assisted alcohol and drug abuse program  Generally, confidential information may be disclosed in accordance with the prior written consent of the patient  State and local CPS staff we interviewed said that strict confidentiality requirements make it challenging for drug and alcohol treatment providers to share information about mothers and infants  A CPS state director from Pennsylvania said that treatment providers are often reluctant to provide CPS case workers with information or updates on a mother’s treatment, which prevents child welfare workers from fully understanding how mothers are progressing with their treatment and the extent to which those in treatment are adhering to prescribed directions as outlined by treatment providers  In addition, one official from a state we visited said state statutes regarding sharing of drug and alcohol treatment information may be more restrictive than the federal statute  Some states have developed ways to obtain confidential information about mothers in substance use disorder treatment  For example, officials from one local CPS office told us that in instances when they have to develop a long-term plan of safe care for families, they have mothers sign a release of information form in order to obtain updates about her treatment adherence from the medication- assisted treatment provider  Similarly, a local Massachusetts CPS office told us that typically staff obtain releases from mothers so that they can verify whether mothers are actively participating in their treatment and that there are no records of relapse  In HHS’ role to assist states in the delivery of child welfare services, two agencies—ACF and the Substance Abuse and Mental Health Services Administration (SAMHSA)—provided technical assistance to states through the National Center on Substance Abuse and Child Welfare (NCSACW)  In addition, in ACF’s role to administer and monitor states’ implementation of CAPTA, the agency has provided some guidance to states on the provisions pertaining to substance-affected infants and has begun its monitoring responsibilities  ACF and SAMHSA, which leads public health efforts to reduce the impact of substance abuse and mental illness, established the NCSACW in 2002  The NCSACW provides technical assistance to states, and has issued publications and hosted forums to help states develop policies and procedures around issues affecting substance-affected infants  The technical assistance has focused on a broad range of issues, including collaboration among service providers, and plans of safe care  With respect to collaboration, NCSACW has issued several studies that identify opportunities for strengthening interagency efforts to prevent, intervene, identify, and treat prenatal substance exposure  The NCSACW collaboration guides encourage states to involve CPS agencies with medical providers in an interagency collaborative setting, thereby facilitating the process for CPS agencies to be notified of substance- affected infants  Regarding plans of safe care, NCSACW has provided technical assistance and best practices to states around development of these plans  For example, in one state it has facilitated discussion groups to help the state develop a model plan  From calendar year 2011 to 2016, NCSACW processed approximately 600 requests from state CPS agencies for short-term technical assistance related to improving care for substance-affected infants and their families  This short-term technical assistance included activities such as responding to telephone inquiries, mailing information, identifying needed resources, and making referrals  The NCSACW has also provided in- depth assistance to 16 states to strengthen collaboration and linkages across child welfare, addiction treatment, medical communities, early care and education systems, and family courts to improve outcomes for substance-affected infants and their families  Through this in-depth assistance, NCSACW identified areas for improvement in states, including a lack of clarity regarding compliance with CAPTA requirements (such as identification, notification, and developing plans of safe care) and the need for state models to comply with CAPTA requirements to develop plans of safe care  In one state, the project overview report indicated that a next step for the in-depth technical assistance is to continue development of the plan of safe care model and ensure practices and protocols are in place across systems to meet CAPTA requirements  The report indicated that this will include ongoing work with hospitals to ensure consistent identification of infants with prenatal exposure and notifications to CPS  Although18 states reported in our survey that technical assistance from the NCSACW was very or extremely helpful, 11 reported that it was moderately helpful, 7 reported that it was slightly helpful, and 1 reported that it was not at all helpful  Eleven states reported that they were not familiar with this assistance  Since July 2016, when the most recent amendments to CAPTA were enacted, ACF has issued one information memorandum and two program instructions to states about provisions relating to substance-affected infants  According to an ACF official, information memoranda share information with states, while program instructions provide interpretations of the law and inform states of actions they must take  ACF issued an August 2016 information memorandum informing states of the 2016 amendments to CAPTA  The August 2016 information memorandum also provided states with best practices, drawing on an NCSACW guide on collaboration for developing multi-systemic approaches to assist child welfare, medical, substance use disorder treatment, and other systems to support families affected by opioid use disorders  In January 2017, ACF issued a program instruction which provided guidance to states on implementing the 2016 amendments to CAPTA made by CARA and informed states of the flexibilities that they have under the law  Particularly, the guidance noted that: “CAPTA does not define ‘substance abuse’ or ‘withdrawal symptoms resulting from prenatal drug exposure ’ We recognize that by deleting the term ‘illegal’ as applied to substance abuse affecting infants, the amendment potentially expands the population of infants and families subject to the provision [that states have policies and procedures in place to address their needs]  States have flexibility to define the phrase, ‘infants born and identified as being affected by substance abuse or withdrawal symptoms resulting from prenatal drug exposure,’ so long as the state’s policies and procedures address the needs of infants born affected by both legal (e g , prescribed drugs) and illegal substance abuse ” “While CAPTA does not specifically define a ‘plan of safe care,’ CARA amended the CAPTA state plan requirement       to require that a plan of safe care address the health and substance use disorder treatment needs of the infant and affected family or caregiver ” “CAPTA does not specify which agency or entity must develop the plan of safe care; therefore the state may determine which agency will develop the plans  We understand that in most instances the state already has identified the responsible agency in its procedures  When the state reviews and modifies its policies and procedures to incorporate the new safe care plan requirements in CARA, the state may wish to revisit its procedures regarding which agency develops the plan of safe care, including any role for agencies collaborating with CPS in caring for the infant and family ” In addition, in April 2017, ACF issued a program instruction on reporting requirements, including changes in those requirements brought about by the 2016 amendments to CAPTA  ACF conducted limited monitoring of states prior to the amendments passed in 2016  According to ACF officials, if presented with evidence of potential deficiencies, the agency would attempt to learn more about the state’s activities  In one instance, ACF reviewed South Carolina’s policies and found them to not be in compliance with the notification and safe care plan requirements of CAPTA  It directed the state to develop a program improvement plan to bring it into full compliance, which South Carolina submitted in April 2016  In a recent progress report (February–April 2017), South Carolina reported that it was focused on updating statutes, developing policies and procedures, training child protective service workers, and building relations with health care providers  In response to the 2016 amendments to CAPTA that added the requirement for HHS to monitor state policies and procedures to address the needs of substance-affected infants, ACF officials told us that staff in regional offices will review states’ annual reports, submitted in June 2017  In its program instruction describing the reporting requirements, ACF asked each state to submit a new Governor’s Assurance, as well as a narrative explaining what they have done in response to the amendments  Specifically, ACF asked states to provide information on any changes that were made in state laws, policies, or procedures related to identifying and referring infants affected by substance abuse to CPS as a result of prenatal drug exposure  It also requested updates on states’ policies and procedures regarding the development of plans of safe care; a description of how states have developed systems to monitor plans of safe care; and a description of any outreach or coordination efforts the states have taken to implement the amendments, among other things  According to ACF officials, as of October 1, 2017, some states have provided information and a Governor’s Assurance demonstrating compliance with the amended provisions and some states have been placed on Program Improvement Plans, but the agency does not yet have information on the status of all states  An ACF official explained that, in their annual reports, some states either acknowledged that they are trying to get legislation enacted to bring them into compliance with the law and it has failed, or that they are not in compliance, for example, because they were limiting their policies to those infants affected only by illegal substances  In addition, in May 2017, ACF issued a technical bulletin informing states of the new data collection requirements that resulted from the 2016 amendments to CAPTA  ACF stated that it intends to collect data required by the amendments to CAPTA through the National Child Abuse and Neglect Data System, beginning with states’ submission of fiscal year 2018 data  This system is maintained by ACF and contains data from states about children who have been abused or neglected  ACF issued a Federal Register notice about the proposed data elements and requested comments on the accuracy and quality of the proposed data collection, among other things; the comment period closed in July 2017  In the Federal Register notice, ACF notes that the 2016 amendments to CAPTA require it to collect information from state CPS agencies on the number of notifications from health care providers that are accepted for investigation or screened out  Further, of those infants screened in, ACF is required to collect data on the number of safe care plans developed for substance- affected infants as well as the number of infants for whom a referral was made for appropriate services, including services for the affected family or caregiver  In the Federal Register notice, ACF proposed to collect this information using a combination of existing and new data from states  Thirty-two states reported in our survey that they already collect data on the incidence of substance-affected and/or substance-exposed infants; 15 of those 32 states also collect data on the incidence of NAS  Further, 18 states reported that they collect data on the number of notifications health care providers make to CPS  Of those states, 8 reported that they collect specific data on notifications related to infants diagnosed with NAS  Most states reported in our survey that additional guidance and assistance would be extremely or very helpful (see figure 3)  For example, 38 states reported that additional guidance on requirements for health care providers to notify CPS of substance-affected infants would be extremely or very helpful  Similarly, 37 states reported that additional guidance on developing, implementing, and monitoring plans to ensure the safety and well-being of substance-affected infants would be extremely or very helpful  In written responses to our survey, states suggested ideas for additional guidance, training, and technical assistance to help them address the needs of substance-affected infants  States’ suggestions ranged from assisting in the development of substance abuse training curriculum for staff to video conferences with other states to share information about implementing CAPTA  A few states suggested that the guidance ACF has provided to date is not clear and reported grappling with the meaning of terms such as “affected” and “legal vs  illegal” substances, and two states requested “concrete guidance” and “specificity ” A few other states suggested that it would be helpful to obtain additional information about meeting the requirements of plans of safe care within the constraints of state and federal confidentiality laws, technical assistance on what plans of safe care look like, and a format for a plan of safe care  ACF officials told us that states have flexibility with implementing the law and the agency does not anticipate issuing additional written guidance on the amendments to CAPTA made by CARA  ACF officials explained, in October 2017, that they were finalizing their review of the plans that states were required to submit  These plans are expected to include details on how the states are addressing the CAPTA requirements  While ACF could not provide the number, officials reported that some of the state plans submitted to date did not meet the requirements and those states have been asked to develop program improvement plans  They expect states to work with the ACF regional offices, which will provide or facilitate technical assistance to states on their implementation of the provisions, as needed  In addition to the review of state plans, ACF officials explained that regional officials may learn about states’ needs for technical assistance through meetings or informational exchanges  Finally, the NCSACW is expected to review and prepare a summary of CAPTA state plans, current state statutes and policies and procedures relating to amended CAPTA requirements  In addition, according to ACF, NCSACW will continue to offer technical assistance on the development and implementation of plans of safe care to states  Technical assistance may include responding to requests for information, disseminating written materials and resources, and conducting webinars/conference calls  Further, ACF reported that some states will receive more in-depth technical assistance, albeit in some instances on a time-limited basis  Undertaking these actions can enhance states’ understanding of CAPTA requirements and better address known challenges such as the ones described in this report  However, more specific guidance from HHS on the issues which states have expressed confusion can assist them in better understanding CAPTA requirements and providing more effective protections and services for the children and families most in need  The opioid epidemic has generated a significant increase in the number of substance-affected infants born and diagnosed with NAS  These vulnerable infants may be at risk for child abuse and neglect if adequate supports and services are not available to ensure their safety  CAPTA requires states to have policies and procedures to address the needs of these infants and their families, including mothers with a substance use disorder  However, states have experienced challenges implementing new CAPTA requirements  Many states reported in our survey that they are not completely adhering to the law  This is reflected in ACF’s review of state plans, some of which are resulting in program improvement plans  States cite challenges that stem, in part, from ACF’s lack of specificity in providing guidance on implementing CAPTA requirements  Specifically, states report that ACF has not provided clear guidance about which substance-affected infants health care providers are required to notify CPS about, as well what a plan of safe care is and for whom it should be developed  Given the challenges that states reported facing in implementing the provisions, a majority reported wanting more help from ACF, such as trainings and teleconferences with other states, to help overcome their challenges  Additional guidance and assistance from HHS would help states better understand what they need to do to develop policies and procedures that meet the needs of children and families affected by substance use  The Secretary of HHS should direct ACF to provide additional guidance and technical assistance to states to address known challenges and enhance their understanding of CAPTA requirements, including the requirements for health care providers to notify CPS of substance- affected infants and the development of a plan of safe care for these infants  We provided a draft of this report to HHS for review and comment  HHS’s comments are reproduced in appendix I  HHS also provided technical comments, which we incorporated into our report where appropriate  HHS did not concur with our recommendation  HHS stated that: in January 2017, ACF clarified in guidance several of the issues raised in the report, including the population of infants and families covered by the provision and the state flexibility inherent in determining which infants are “affected by” substance abuse, and the terminology used in the federal law of what a “plan of safe care” is; ACF believes it is necessary to allow states the flexibility to meet the requirements in the context of their state CPS program; several of the challenges that the GAO notes are not specific to CAPTA compliance with the safe care plan and notification requirements; and it does see the value in continuing to provide technical assistance to states to address known challenges and to enhance their understanding of CAPTA requirements  With respect to HHS’ January 2017 guidance, state officials reported in our survey and during site visits that they found some terms unclear and were uncertain about what is required of them  In written responses to our survey, states reported challenges understanding how to define substance-affected under CAPTA  In addition, as we note in our report, the guidance about plans of safe care described the following: “While CAPTA does not specifically define a ‘plan of safe care,’ CARA amended the CAPTA state plan requirement       to require that a plan of safe care address the health and substance use disorder treatment needs of the infant and affected family or caregiver ” States reported in our survey and in follow-up discussions that this lack of specificity remained an ongoing challenge for them  For example, as we discuss in our report, one state that we followed up with in August 2017 was still unsure about whether its safety plans would meet CAPTA requirements for plans of safe care  In addition, as of October 2017, HHS confirmed that some state plans did not meet CAPTA requirements and that the states were asked to develop program improvement plans  Accordingly, a key ongoing challenge was not addressed by the January guidance  Regarding allowing states flexibility to meet CAPTA requirements, we acknowledge in our report that HHS said that states have flexibility  However, in our survey and site visits, states indicated that they would find it helpful for HHS to provide them with greater specificity around terms, including the degree of flexibility they are allowed  States added that this would include parameters within which they can develop policies and procedures that meet CAPTA requirements  We continue to believe that additional guidance addressing these concerns would benefit states and could be provided without imposing additional mandates  Concerning HHS’ third point that some of the issues raised in the report are not specific to CAPTA, the states we visited interpret CAPTA to require that plans of safe care be developed for all substance-affected infants who are referred to CPS  During our discussions with states and in responses to our survey, state officials did not delineate which federal requirement impacted their approach to serving children and families  As stated in our conclusion, vulnerable infants may be at risk for child abuse and neglect if adequate supports and services are not available to ensure their safety  Lastly, HHS indicated that it will continue to provide technical assistance to states and fund demonstration sites to establish or enhance collaboration across community agencies and courts  Although continuing to provide technical assistance to states should be beneficial, our findings demonstrate that additional guidance is also needed  For example, 38 states reported that additional guidance on requirements for health care providers to notify CPS of substance-affected infants would be extremely or very helpful  Similarly, 37 states reported that additional guidance on developing, implementing, and monitoring plans to ensure the safety and well-being of substance-affected infants would be extremely or very helpful  Overall, given the results of our review, we continue to believe our recommendation is warranted  Effective implementation of our recommendation should help states better implement protections for children  As agreed with your office, unless you publicly announce the contents of this report earlier, we plan no further distribution until 30 days from the report date  At that time, we will send copies of this report to the appropriate congressional committees and the Secretary of Health and Human Services  In addition, the report is available at no charge on the GAO website at http://www gao gov  If you or your staff have any questions about this report, please contact me at (202) 512-7215 or larink@gao gov  Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report  GAO staff who made key contributions to this report are listed in appendix II  Kathryn A  Larin, (202) 512-7215 or larink@gao gov  In addition to the contact above, Sara Schibanoff Kelly (Assistant Director), Ramona L  Burton (Analyst-in-Charge), Kay E  Brown, Hannah Dodd, Ada Nwadugbo, and Srinidhi Vijaykumar made key contributions to this report  Also contributing to this report were Sandra L  Baxter, James Bennett, Gina Hoover, Jessica Orr, Rhiannon Patterson, Jean McSween, and James Rebbe 

ground_truth: Historically, Egypt has been an important country for U.S. national security interests based on its geography, demography, and diplomatic posture. Egypt controls the Suez Canal, which is one of the world's most well-known maritime chokepoints, linking the Mediterranean and Red Seas. Egypt, with its population of more than 100 million people, is by far the most populous Arabic-speaking country. Although it may not play the same type of leading political or military role in the Arab world as it has in the past, Egypt may retain some "soft power" by virtue of its history, media, and culture. Cairo plays host both to the 22-member Arab League and Al Azhar University, which claims to be the oldest continuously operating university in the world and has symbolic importance as a leading source of Islamic scholarship. Additionally, Egypt's 1979 peace treaty with Israel remains one of the most significant diplomatic achievements for the promotion of Arab-Israeli peace. While people-to-people relations remain cold, the Israeli and Egyptian governments have increased their cooperation against Islamist militants and instability in the Sinai Peninsula and Gaza Strip. Personnel moves and possible amendments to the Egyptian constitution highlight apparent efforts by President Sisi to consolidate power with the help of political allies, including colleagues from Egypt's security establishment. President Sisi has come under repeated international criticism for an ongoing government crackdown against various forms of political dissent and freedom of expression. The Egyptian government has defended its human rights record, asserting that the country is under pressure from terrorist groups seeking to destabilize Arab nation-states. The Trump Administration has tried to normalize ties with the Sisi government that were generally perceived as strained under President Obama. In January 2019, U.S. Secretary of State Michael Pompeo delivered a major policy speech at the American University in Cairo, where he stated, "And as we seek an even stronger partnership with Egypt, we encourage President Sisi to unleash the creative energy of Egypt's people, unfetter the economy, and promote a free and open exchange of ideas." The United States has provided significant military and economic assistance to Egypt since the late 1970s. Successive U.S. Administrations have justified aid to Egypt as an investment in regional stability, built primarily on long-running cooperation with the Egyptian military and on sustaining the 1979 Egyptian-Israeli peace treaty. All U.S. foreign aid to Egypt (or any recipient) is appropriated and authorized by Congress. Since 1946, the United States has provided Egypt with over $83 billion in bilateral foreign aid (calculated in historical dollars—not adjusted for inflation). Annual appropriations legislation includes several conditions governing the release of these funds. All U.S. military aid to Egypt finances the procurement of weapons systems and services from U.S. defense contractors. For FY2019, Congress has appropriated $1.4 billion in total bilateral assistance for Egypt, the same amount it provided in FY2018. For FY2020, the President is requesting a total of $1.382 billion in bilateral assistance for Egypt. Nearly all of the U.S. funds for Egypt come from the FMF account (military aid). In November 2018, the U.S. Defense Department notified Congress of a major $1 billion sale of defense equipment to Egypt, consisting of 10 AH-64E Apache Attack Helicopters, among other things. Beyond the United States, President Sisi has broadened Egypt's international base of support to include several key partners, including the Arab Gulf states, Israel, Russia, and France. In the last five years, as French-Egyptian ties have improved, Egypt has purchased major air and naval defense systems from French defense companies.

prompt_front: You are given two reports by the government agency.



Question: Write a one-page summary of the report 2.

Report 1: Since 1952, when a cabal of Egyptian Army officers, known as the Free Officers Movement, ousted the British-backed king, Egypt's military has produced four presidents; Gamal Abdel Nasser (1954-1970), Anwar Sadat (1970-1981), Hosni Mubarak (1981-2011), and Abdel Fattah el Sisi (2013-present)  In general, these four men have ruled Egypt with strong backing from the country's security establishment  The only significant and abiding opposition has come from the Egyptian Muslim Brotherhood, an organization that has opposed single party military-backed rule and advocated for a state governed by a vaguely articulated combination of civil and Shariah (Islamic) law  Egypt's sole departure from this general formula took place between 2011 and 2013, after popular demonstrations sparked by the "Arab Spring," which had started in neighboring Tunisia, compelled the military to force the resignation of former President Hosni Mubarak in February 2011  During this period, Egypt experienced tremendous political tumult, culminating in the one-year presidency of the Muslim Brotherhood's Muhammad Morsi  When Morsi took office on June 30, 2012, after winning Egypt's first truly competitive presidential election, his ascension to the presidency was supposed to mark the end of a rocky 16-month transition period  Proposed time lines for elections, the constitutional drafting process, and the military's relinquishing of power to a civilian government had been constantly changed, contested, and sometimes even overruled by the courts  Instead of consolidating democratic or civilian rule, Morsi's rule exposed the deep divisions in Egyptian politics, pitting a broad cross-section of Egypt's public and private sectors, the Coptic Church, and the military against the Brotherhood and its Islamist supporters  The atmosphere of mutual distrust, political gridlock, and public dissatisfaction that permeated Morsi's presidency provided Egypt's military, led by then-Defense Minister Sisi, with an opportunity to reassert political control  On July 3, 2013, following several days of mass demonstrations against Morsi's rule, the military unilaterally dissolved Morsi's government, suspended the constitution that had been passed during his rule, and installed an interim president  The Muslim Brotherhood and its supporters declared the military's actions a coup d'etat and protested in the streets  Weeks later, Egypt's military and national police launched a violent crackdown against the Muslim Brotherhood, resulting in police and army soldiers firing live ammunition against demonstrators encamped in several public squares and the killing of at least 1,150 demonstrators  The Egyptian military justified these actions by decrying the encampments as a threat to national security  As Egyptian President Abdel Fattah al Sisi consolidates his power amid a continuing macroeconomic recovery, Egypt is poised to play an increasingly active role in the region, albeit from a more independent position vis-a-vis the United States than in the past  Although Egyptian relations with the Trump Administration are solid, and Egypt has relied on the International Monetary Fund (IMF) program to guide its economic recovery, Egypt seems committed to broadening its international base of support  The United States plays a key role in that international base, but Egypt also has other significant partners, including the Arab Gulf states, Israel, Russia, and France  The Egyptian government blames American criticism of its human rights record for preventing closer U S -Egyptian ties  From the U S  perspective, some Members of Congress, U S  media outlets, and advocacy groups document how Egyptian authorities have widened the scope of a crackdown against dissent, which initially was aimed at the Muslim Brotherhood but has evolved to encompass a broader range of political speech  Egypt's parliament is currently considering whether to adopt a package of draft constitutional amendments that would extend presidential term limits and executive branch control over the judiciary  If Egypt's 2019 constitutional amendments are approved, President Sisi will attain unprecedented power in the political system over the military and the judiciary and, if reelected, will have the potential to remain in office until 2034  He has inserted his older brother and oldest son into key security and intelligence positions while stymying all opposition to his rule and criticism of his government  This consolidation of power and crackdown against dissent has taken place during a period of steady economic growth, which has not benefitted wide swaths of the population  The state has enacted a series of austerity measures to reduce debt in compliance with IMF-mandated reforms  In the year ahead, economists anticipate gross domestic product (GDP) growth of 5 3%, driven by an expansion in tourism and natural gas production  Nevertheless, Egyptians continue to endure double-digit inflation stemming in part from the 2016 flotation of the currency, tax increases, and reductions in food and fuel subsidies  While it is difficult to ascertain how dissatisfied the public is with rising prices, President Sisi has responded to criticisms of his economic policies, stating: "The path of real reform is difficult and cruel and causes a lot of suffering     But there is no doubt that the suffering resulting from the lack of reform is much worse " The IMF has praised the Egyptian government's record of reform implementation, while also highlighting the need for private sector growth "that will absorb the rapidly growing labor force and ensure that the benefits are perceived more widely " After several years of observers seeing Egypt as more inwardly focused, several recent developments suggest an increasingly active foreign policy  In January 2019, Egypt hosted an international forum on Mediterranean gas which included European and Arab countries together with Israel  A month later, President Sisi was elected head of the African Union for a year-long term  In February 2019, Egypt hosted the first-ever European Union- Arab summit in Sharm el Sheikh, where officials discussed terrorism, migration, and the need for greater European-Arab cooperation to counter a perceived growing Chinese and Russian interest in the Middle East  Personnel moves and other developments in Egypt highlight apparent efforts by President Sisi to consolidate power with the help of political allies, including colleagues from Egypt's security establishment  In June 2018, Sisi reshuffled his cabinet, making key changes to the defense and interior ministries, among other appointments  Sisi appointed Mohamed Ahmed Zaki, former head of the Republican Guard, as defense minister and Mahmoud Tawfik, former head of the National Security Service, as interior minister  According to one account, Sisi may have been rewarding Zaki for his role in arresting former Egyptian President Mohamed Morsi in 2013  In July 2018, parliament passed Law 161 of 2018, providing judicial immunity to senior military commanders for military acts committed during the two-and-a-half-year period beginning with the military coup of July 2013  The new law grants immunity to senior commanders while potentially keeping high-ranking officers on reserve duty for life, making them ineligible to run for president  In order for a senior commander to be prosecuted under this new law, a case would have to be first authorized by the Supreme Council of the Armed Forces (SCAF), which President Sisi appoints  According to one analysis, the law deters senior officers from challenging President Sisi (for example, some challenges occurred during the run-up to the 2018 presidential election), thereby acting "as a guarantor of President Sisi's authoritarian rule, setting the stage for him to remain president for life " Per the 2014 Egyptian constitution (article 140), President Sisi, who was reelected in April 2018, may only serve two four-year terms in office (current term ends in 2022)  However, his supporters have proposed a set of amendments to the constitution which, if approved by parliament and public referendum, have the potential to make President Sisi eligible for an additional two six-year terms when his current term ends in 2022  Other proposed changes to the constitution include granting the president the authority to appoint all chief justices of Egyptian judicial bodies, and the public prosecutor; requiring that at least one-quarter of the seats in the parliament be allocated to women and reducing the number of the seats in the House of Representatives from 596 to 450; and establishing an upper house of parliament (Senate) consisting of 250 members, two-thirds of whom would be elected and one-third of whom would be appointed by the president  President Sisi has come under repeated international criticism for an ongoing government crackdown against various forms of political dissent and freedom of expression  Certain practices of Sisi's government, the parliament, and the security apparatus have been contentious  According to the U S  State Department's report on human rights conditions in Egypt in 2017: The most significant human rights issues included arbitrary or unlawful killings by the government or its agents; major terrorist attacks; disappearances; torture; harsh or potentially life-threatening prison conditions; arbitrary arrest and detention; including the use of military courts to try civilians; political prisoners and detainees; unlawful interference in privacy; limits on freedom of expression, including criminal "defamation of religion" laws; restrictions on the press, internet, and academic freedom; and restrictions on freedoms of assembly and association, including government control over registration and financing of NGOs [nongovernmental organizations]  LGBTI persons faced arrests, imprisonment, and degrading treatment  The government did not effectively respond to violence against women, and there were reports of child labor  Select international human rights, democracy, and development monitoring organizations provide the following rankings for Egypt globally: Other human rights issues of potential interest to Congress may include the 2013 convictions of American, European, and Egyptian civil society representatives; the controversial 2017 NGO law; the detention of American citizens in Egypt; and the treatment of Coptic Christians, discussed in the following sections  In 2013, an Egyptian court convicted and sentenced 43 individuals from the United States, Egypt, and Europe, including the Egypt country directors of the National Democratic Institute (NDI) and the International Republican Institute (IRI), for spending money from organizations that were operating in Egypt without a license and for receiving foreign funds (known as Case 173 or the "foreign funding case")  Some lawmakers had protested that those individuals were wrongfully convicted and had requested that the Egyptian government and judiciary resolve the matter  In 2018, a retrial began and, on December 20, 2018, the individuals were acquitted of all charges  In January 2019, U S  Secretary of State Michael R  Pompeo traveled to Cairo, where he remarked: "I was happy to see our citizens, wrongly convicted of improperly operating NGOs here, finally be acquitted  And we strongly support President Sisi's initiative to amend Egyptian law so that this does not happen again  More work certainly needs to be done to maximize the potential of the Egyptian nation and its people  I'm glad that America will be a partner in those efforts " However, Case 173 remains active, as the judiciary has imposed asset freezes and travel bans on several Egyptian civil society activists  In May 2017, President Sisi signed Law 70 of 2017 on Associations and Other Foundations Working in the Field of Civil Work  The parliament had passed this bill six months earlier, and both the passage and signing drew widespread international condemnation  The new law (which replaced a 2002 NGO law) requires NGOs to receive prior approval from internal security before accepting foreign funding  It also restricts the scope of permitted NGO activities and increases penalties for violations, including possible imprisonment for up to five years  However, the government did not issue implementing regulations for the new NGO law  At Egypt's November 2018 World Youth Forum in Sharm el Sheikh, President Sisi announced plans to amend Law 70  According to Sisi, "I want to reassure those who are listening to me inside Egypt and outside of Egypt, that in Egypt, we are keen that the law becomes balanced and achieves what is required of it to regulate the work of these groups in a good way  This is not just political talk " Since then, Egypt's Ministry of Social Solidarity has held multiple rounds of talks with local NGOs aimed at determining which articles of the law need to be amended  A draft proposal is expected to be ready in the spring of 2019, when it will be sent to parliament for consideration  The detention of American citizens in Egypt has continued to strain U S -Egyptian relations  Some Members of Congress are concerned about the case of 53-year-old New York resident Mustafa Kassem, who was detained by authorities in 2013 and sentenced to 15 years in prison in a mass trial in September 2018  These lawmakers insist that Kassem, who has been on a limited hunger strike, was wrongfully arrested and convicted, and they have sought Trump Administration support in securing his release from the government of Egypt  In January 2018, Vice President Pence raised Kassem's case directly with President Sisi in a meeting in Cairo, saying "I told him we'd like to see those American citizens restored to their families and restored to our country " Since taking office, President Sisi has publicly called for greater Muslim-Christian coexistence and national unity  In January 2019, he inaugurated Egypt's Coptic Cathedral of Nativity in the new administrative capital east of Cairo saying, "This is an important moment in our history     We are one and we will remain one " Despite these public calls for improved interfaith relations in Egypt, the minority Coptic Christian community continues to claim that they face professional and social discrimination, along with occasional sectarian attacks by terrorists and vigilantes  Coptic Christians have also voiced concern about state regulation of church construction  They have long demanded that the government reform long-standing laws (with two dating back to 1856 and 1934, respectively) on building codes for Christian places of worship  Article 235 of Egypt's 2014 constitution mandates that parliament reform these building code regulations  In 2016, parliament approved a church construction law (Law 80 of 2016) that expedited the government approval process for the construction and restoration of Coptic churches, among other structures  Although Coptic Pope Tawadros II welcomed the law, others claim that it continues to be discriminatory  According to Human Rights Watch , "the new law allows governors to deny church-building permits with no stated way to appeal, requires that churches be built 'commensurate with' the number of Christians in the area, and contains security provisions that risk subjecting decisions on whether to allow church construction to the whims of violent mobs " For 2019, the IMF projects 5 3% GDP growth for the Egyptian economy, noting that the outlook remains "favorable, supported by strong policy implementation " In 2016, the IMF and Egypt reached a three-year, $12 billion loan agreement, $10 billion of which has been disbursed as of March 2019  Key sources of foreign exchange (tourism and remittances) are up and unemployment is at its lowest level since 2011  In line with IMF recommendations, the government has taken several steps to reform the economy, including depreciating the currency, reducing fuel subsidies, enacting a value-added tax (VAT), and providing cash payments to the poor in lieu of subsidizing household goods (though many food subsidies continue)  Egypt's energy sector also is contributing to the economy's rebound  Egypt is the largest oil producer in Africa outside of the Organization of the Petroleum Exporting Countries (OPEC) and the third-largest natural gas producer on the continent following Algeria and Nigeria  In December 2017, an Egyptian and Italian partnership began commercial output from the Zohr natural gas field (est  30 trillion cubic feet of gas), the largest ever natural gas field discovered in the Mediterranean Sea (see Figure 3 )  The Egyptian government also has repaid debts owed to foreign energy companies, allowing for new investments from BP and BG Group  Egypt is attempting to position itself as a regional gas hub, whereby its own gas fields meet domestic demand while imported gas from Israel and Cyprus can be liquefied in Egypt and reexported  Israeli and Egyptian companies have bought significant shares of an unused undersea pipeline connecting Israel to the northern Sinai Peninsula (see Figure 4 )  The pipeline will be used to transport natural gas from Israel to Egypt for possible reexport, as part of an earlier 10-year, $15 billion gas deal between the U S  Company Noble Energy, its Israeli partner Delek, and the Egyptian company Dolphinus Holdings  In January 2019, Egypt convened the first ever Eastern Mediterranean Gas Forum (EMGF), a regional consortium consisting of Egypt, Israel, Jordan, the Palestinian Authority, Cyprus, Greece, and Italy, intended to consolidate regional energy policies and reduce costs  Despite Egypt's positive economic outlook, significant challenges remain  Inflation remains over 11%, making the cost of goods high for many Egyptians  In addition, while the fiscal deficit may be decreasing, Egypt's overall public and foreign debt have grown significantly in recent years and remain high, leading the government to allocate resources (nearly 38% of Egypt's budget) toward debt-service payments and away from spending on health and education  Economists forecast that total public debt will reach 84 8% of GDP and external debt 32% of GDP ($101 7 billion) in 2019  Some observers assert that Egypt's recent economic reforms, while successful in the short term, have not addressed deeper structural impediments to growth  For example, Egypt's industrial sector is heavily dependent upon imports and, as the economy expands, the demand for foreign currency increases  According to Bloomberg , "this means, the more the economy grows, the greater the pressure on dollar reserves  It doesn't help that these were built up almost entirely through foreign borrowing, pushing Egypt's foreign debt from $55 billion in 2016 to $92 billion in late 2018  It won't be long before the country's finances are once again in crisis " Many experts argue that to sustain growth over the long term, Egypt requires dramatic expansion of the nonhydrocarbon private sector  For decades, Egypt's military has played a key role in the nation's economy as a food producer and low-cost domestic manufacturer of consumable products; however, due to political sensitivities, the extent of its economic power is rarely quantified  Egypt's military is largely economically self-sufficient  It produces what it consumes (food and clothes) and then sells surplus goods for additional revenue  Egyptian military companies have been the main beneficiaries of the massive infrastructure contracts Sisi has commissioned  Moreover, military-owned manufacturing companies have expanded into new markets, producing goods (appliances, solar panels, some electronics, and some medical equipment) that are cheaper than either foreign imports or domestically produced goods made by the private sector  President Sisi, who led the 2013 military intervention and was elected president in mid-2014, came to power promising not only to defeat violent Salafi-Jihadi terrorist groups militarily, but also to counter their foundational ideology, which President Sisi and his supporters often attribute to the Muslim Brotherhood  President Sisi has outlawed the Muslim Brotherhood while launching a more general crackdown against a broad spectrum of opponents, both secular and Islamist  While Egypt is no longer beset by the kind of large-scale civil unrest and public protest it faced during the immediate post-Mubarak era, it continues to face terrorist and insurgent violence, both in the Sinai Peninsula and in the rest of Egypt  Terrorists based in the Sinai Peninsula (the Sinai) have been waging an insurgency against the Egyptian government since 2011  While the terrorist landscape in Egypt is evolving and encompasses several groups, the Islamic State's Sinai Province affiliate (IS-SP) is known as the most lethal  Since its affiliation with the Islamic State in 2014, IS-SP has attacked the Egyptian military continually, targeted Coptic Christian individuals and places of worship, and occasionally fired rockets into Israel  In October 2015, IS-SP targeted Russian tourists departing the Sinai by planting a bomb aboard Metrojet Flight 9268, which exploded midair, killing all 224 passengers and crew aboard  Two years later, on November 24, 2017, IS-SP gunmen launched an attack against the Al Rawdah mosque in the town of Bir al Abed in northern Sinai  That attack killed at least 305 people, making it the deadliest terrorist attack in Egypt's modern history  Combating terrorism in the Sinai is particularly challenging due to an array of factors, including the following: Geograph y : The peninsula's interior is mountainous and sparsely populated, providing militants with ample freedom of movement  Demograph y and Culture : The Sinai's northern population is a mix of Palestinians and Bedouin Arab tribes whose relationship to the state is filled with distrust  Sinai Bedouin have faced discrimination and exclusion from full citizenship and access to the economy  In the absence of development, a black market economy based primarily on smuggling has thrived, further contributing to the popular portrayal of Bedouin as outlaws  State authorities charge that the Sinai Bedouin seek autonomy from the central government, while residents insist on obtaining basic rights, such as property rights, full citizenship, and access to government services such as education and health care  Econom ics : Bedouins claim that Egypt has underinvested in northern Sinai, channeling development toward southern tourist destinations that cater to foreign visitors  Northern Sinai consists of mostly flat desert terrain inhospitable to large-scale agriculture without significant investment in irrigation  For decades, the Egyptian state has claimed to follow successive Sinai development plans  However, Egyptian governance and development of the Sinai has been hampered by corruption  Diploma cy : The 1979 Israeli-Egyptian peace treaty limits the number of soldiers that Egypt can deploy in the Sinai, subject to the parties' ability to negotiate changes as circumstances necessitate  Egypt and Israel mutually agree upon any short-term increase of Egypt's military presence in the Sinai  Since Israel returned control over the Sinai to Egypt in 1982, the area has been partially demilitarized, and the Sinai has served as an effective buffer zone between the two countries  The Multinational Force and Observers, or MFO, are deployed in the Sinai to monitor the terms of the Israeli-Egyptian peace treaty (see Figure 5 )  Egypt and Israel reportedly continue to cooperate in countering terrorism in the Sinai  In a televised interview, President Sisi responded to a question on whether Egyptian-Israeli military cooperation was the closest it has ever been, saying "That is correct  The [Egyptian] Air Force sometimes needs to cross to the Israeli side  And that's why we have a wide range of coordination with the Israelis " One news account suggests that Israel, with Egypt's approval, has used its own drones, helicopters, and aircraft to carry out more than 100 covert airstrikes inside Egypt against militant targets  In order to counter IS-SP in northern Sinai, the Egyptian armed forces and police have declared a state of emergency, imposed curfews and travel restrictions, and erected police checkpoints along main roads  Authorities also have limited domestic and foreign media access to the northern Sinai, declaring it an active combat zone and unsafe for journalists  According to Jane's Defence Weekly , Egypt may be upgrading an old air base in the Sinai (Bir Gifgafa), where it could deploy Apache attack helicopters and unmanned aerial vehicles for use in counterterrorism operations  While an increased Egyptian military presence in the Sinai may be necessary to stabilize the area, many observers have argued that military means alone are insufficient  These critics say that force should be accompanied by policies to reduce the appeal of antigovernment militancy by addressing local political and economic grievances  According to one account: Sinai residents are prohibited from joining any senior post in the state  They cannot work in the army, police, judiciary, or in diplomacy  Meanwhile, no development projects have been undertaken in North Sinai the past 40 years  The villages of Rafah and Sheikh Zuwayed have no schools or hospitals and no modern system to receive potable water  They depend on rainwater and wells, as if it were the Middle Ages  Egyptian counterterrorism efforts in the Sinai appear to have reduced the frequency of terrorist attacks somewhat  In February 2018, the military launched an offensive campaign, dubbed "Operation Sinai 2018 " During the campaign, the military deployed tens of thousands of troops to the peninsula and was able to eliminate several senior IS-SP leaders  One report suggests that unlike previous military operations against militants in the Sinai, this time the Egyptian military armed progovernment tribesmen to assist conventional forces in combating IS-SP  According to one analysis, the military's recent campaign has "to some degree, restricted the militants' movements, destroyed a number of hideouts, and most importantly eliminated several trained and influential elements " However, as in previous major operations, once the military reduces its presence in northern Sinai, terrorist groups may reconstitute themselves  In March 2019, CENTCOM Commander General Joseph L  Votel testified before Congress, stating that the "Egyptian Armed Forces have more effectively fought ISIS in the Sinai and are now taking active measures to address the underlying issues that give life to—to these violent extremist groups and are helping to contain the threat " Outside of the Sinai, either in the western desert near the Libya border or other areas (Cairo, Nile Delta, Upper Egypt), small nationalist insurgent groups, such as Liwa al Thawra (The Revolution Brigade) and Harakat Sawaed Misr (Arms of Egypt Movement, referred to by its Arabic acronym HASM), have carried out high-level assassinations of military/police officials and bombings of infrastructure  According to one expert, these insurgent groups are comprised mainly of former Muslim Brotherhood activists who have splintered off from the main organization to wage an insurgency against the government  On January 31, 2018, the U S  State Department designated Liwa al Thawra and HASM as Specially Designated Global Terrorists (SDGTs) under Section 1(b) of Executive Order (E O ) 13224  The State Department noted that some of the leaders of both groups "were previously associated with the Egyptian Muslim Brotherhood " Terrorist attacks against key sectors of the economy continue  In December 2018, a bus carrying a group of Vietnamese tourists to the pyramids in Giza hit a roadside bomb killing 4 people and injuring 11 others  No group claimed responsibility for the attack  In February 2019, a terrorist detonated a suicide bomb he was carrying while being pursued by police, killing himself and two officers near Cairo's popular Khan el Khalili market and famous Al Azhar Mosque  Egypt and Israel have continued to find specific areas in which they can cooperate  In 2018, Israeli and Egyptian companies entered into a decade-long agreement by reaching a $15 billion natural gas deal, according to which Israeli off-shore natural gas will be exported to Egypt for liquefaction before being exported elsewhere (see " The Economy " above)  While people-to-people relations remain cold, Israel and Egypt continue to cooperate against Hamas in the Gaza Strip  In mid-November 2018, Egyptian mediation between Israel and Hamas helped calm tensions after an Israeli raid inside Gaza escalated tensions  Egypt reportedly continues to broker indirect Israel-Hamas talks aimed at establishing a long-term cease-fire  Egypt is opposed to Islamist groups wielding political power across the Middle East, and opposes Turkish and Qatari support for Hamas  On the Egyptian-Gaza border, Egypt has tried to thwart arms tunnel smuggling into Gaza and has accused Palestinian militants in Gaza of aiding terrorist groups in the Sinai  In order to weaken Hamas's rule in Gaza, Egypt has sought to restore a Palestinian Authority (PA) presence in Gaza by reconciling it with the PA  Though Egypt has helped broker several agreements aimed at ending the West Bank-Gaza split, Hamas still effectively controls Gaza  Egypt controls the Rafah border crossing into Gaza, the only non-Israeli-controlled entryway into the Strip, which it periodically closes for security reasons  Control over the Rafah border crossing provides Egypt with some leverage over Hamas, though Egyptian authorities use it carefully in order not to spark a humanitarian crisis on their border  Egypt's relations with most Gulf Arab monarchies are strong  Saudi Arabia, the United Arab Emirates (UAE), and Kuwait have provided billions of dollars in financial assistance to Egypt's military-backed government since 2013  Saudi Arabia also hosts nearly 3 million Egyptian expatriates who work in the kingdom, providing a valuable source of remittances for Egyptians back home  From 2013 onward, Emirati companies have made significant investments in the Egyptian economy  Egypt transferred sovereignty to Saudi Arabia over two islands at the entrance to the Gulf of Aqaba—Tiran and Sanafir—that had been under Egyptian control since 1950, in a move that sparked rare public criticism of President Sisi  In June 2017, Egypt joined other Gulf Arab monarchies in boycotting Qatar  In Yemen, Egypt is officially part of the Saudi-led coalition against Houthi forces, though its contribution to the war effort has been minimal  The Egyptian government supports Field Marshal Khalifa Haftar and the Libyan National Army (LNA) movement, which controls most of eastern Libya  Haftar's politics closely align with President Sisi's, as both figures hail from the military and broadly oppose Islamist political forces  From a security standpoint, Egypt seeks the restoration of order on its western border, which has experienced occasional terrorist attacks and arms smuggling  From an economic standpoint, thousands of Egyptian guest workers were employed in Libya's energy sector prior to unrest in Libya in 2011, and Egypt seeks their return to Libya and a resumption of the vital remittances those workers provided the Egyptian economy  Diplomatically, Egypt has tried to leverage its close ties to Haftar and the LNA in order to play the role of mediator between the LNA and Fayez al Sarraj, the Chairman of the Presidential Council of Libya and Prime Minister of the U N -backed Government of National Accord  Egypt's policy toward Libya also is closely aligned with other foreign backers of the LNA, including France and the United Arab Emirates (UAE)  Reportedly, the three countries are working in concert to strengthen the position of Haftar in order to facilitate the eventual reunification of the Libyan army  A 2019 LNA offensive into southern Libya has placed additional pressure on the Government of National Accord and may complicate U S -backed efforts by the United Nations to facilitate a national dialogue, constitutional referendum, and elections in 2019  To Egypt's south, the government is embroiled in regional disputes with Nile Basin countries, such as Ethiopia, which is nearing completion of the $4 2 billion Grand Ethiopian Renaissance Dam, a major hydroelectric project  Egypt argues that the dam, once filled, will limit the flow of the Nile River below Egypt's agreed share  However, many analysts expect that Egypt will address the dispute by increasing water-use efficiency and investing in desalination, rather than using its military to bomb the dam  Reduced Nile flow into Egypt may exacerbate existing water shortages and cause short-term political problems for the Egyptian government, which faces extensive domestic water needs  In February 2019, President Sisi assumed the one-year chairmanship of the African Union, during which he is expected to promote closer relations with fellow African states  Egypt and Russia, close allies in early years of the Cold War, have again strengthened bilateral ties under President Sisi, who has promised to restore Egyptian stability and international prestige  His relationship with Russian President Vladimir Putin has rekindled, in the words of one observer, "a romanticized memory of relations with Russia during the Nasser era " President Sisi first turned to Russia during the Obama Administration, when U S -Egyptian ties were strained, and Egypt seemed intent on signaling its displeasure with U S  policy  Since 2014, Egypt and Russia have improved ties in a number of ways, including through arms deals  Reportedly, Egypt is upgrading its aging fleet of legacy Soviet MiG-21 aircraft to a fourth generation MiG-29M variant with additional deliveries to Egypt in 2018 (first delivered in April 2017)  Egypt also has purchased 46 standard Ka-52 Russian attack helicopters for its air force  Egypt reportedly also has purchased the naval version of the Ka-52 for use on Egypt's two French-procured Mistral-class helicopter dock vessels (see below), and the S-300VM surface-to-air missile defense system from Russia  In August 2018, Egyptian Defense Minister Mohamed Zaki visited Russia, where he attended a Russian arms exhibition  Additionally, Egypt and Russia reportedly have expanded their cooperation on nuclear energy  In 2015, Egypt reached a deal with Russian state energy firm Rosatom to construct a 4,800-megawatt nuclear power plant in the Egyptian Mediterranean coastal town of Daba'a, 80 miles northwest of Cairo  Russia is lending Egypt $25 billion over 35 years to finance the construction and operation of the nuclear power plant (this will cover 85% of the project's total costs)  The contract also commits Russia to supply the plant's nuclear fuel for 60 years and transfer and store depleted nuclear fuel from the reactors  As Egyptian and Russian foreign policies have become more closely aligned in conflict zones such as eastern Libya, bilateral military cooperation has expanded  One report suggests that Russian Special Forces based out of an airbase in Egypt's western desert (Sidi Barrani) may be aiding General Haftar  In November 2017, Egypt and Russia signed a draft agreement governing the use of each other's air space  While Egyptian-Russian ties have grown warmer in recent years, they are not without complications  In the aftermath of an October 2015 terrorist attack against a Russian passenger jet departing from Sharm El Sheikh, visits to Egypt by Russian tourists, previously the country's largest source of tourists, dropped significantly  Russian commercial aircraft have resumed direct flights to Cairo but not to Sharm El Sheikh  Egypt and Russia also engaged in a trade dispute in 2016 over Russian wheat imports  Egypt is the largest global importer of wheat, and the largest export market for Russian wheat  Aside from Russia, France stands out as a non-U S  country with which President Sisi has sought to build a diplomatic and military procurement relationship  In the last five years, as French-Egyptian ties have improved, Egypt has purchased major air and naval defense systems from French defense contractors, including the following: Four Gowind Corvettes (produced by Naval Group)—This deal was signed in July 2014  As part of the French-Egyptian arrangement, some of the Corvette construction has taken place at the Alexandria Shipyard in Egypt  One FREMM multi-mission Frigate (produced by Naval Group)—Named the Tahya Misr (Long Live Egypt), this vessel was delivered to Egypt in 2015  This ship has participated in an annual joint French-Egyptian naval exercise, known as Cleopatra  In February 2015, Egypt purchased 24 Rafale multirole fighters (produced by Dassault Aviation)  Under the initial agreement, Egypt and France may enter into a new procurement agreement for 12 additional Rafale fighters  According to the manufacturer, the Rafale has flown in combat in Afghanistan, Libya, Mali, Iraq, and Syria and is used by Egypt, Qatar, and India  In 2018, French officials said that the United States would not permit France to export the SCALP air-launched land-attack cruise missile used on the Rafale to Egypt under the International Trade in Arms Regulation (ITAR) agreement  The United States may have been concerned over the transfer of sensitive technology to Egypt  Two Mistral-class Helicopter Carriers (produced by Naval Group)—In the fall of 2015, France announced that it would sell Egypt two Mistral-class Landing Helicopter Dock (LHD) vessels (each carrier can carry 16 helicopters, 4 landing craft, and 13 tanks) for $1 billion  The LHDs (ENS Anwar El Sadat and ENS Gamal Abdel Nasser ) were delivered in 2016  In 2017, Egypt announced that it would purchase Russian 46 Ka-52 Alligator helicopters, which can operate on the LHDs  In January 2019, French President Emmanuel Macron paid a three-day visit to Egypt, where he raised human rights issues in public and with Egyptian authorities and civil society representatives  According to Macron, "I can't see how you can pretend to ensure long-term stability in this country, which was at the heart of the Arab Spring and showed its taste for freedom, and think you can continue to harden beyond what's acceptable or justified for security reasons " President Trump has praised the Egyptian government's counterterrorism efforts while his Administration has worked to restore high-level diplomatic engagement, joint military exercises, and arms sales  Many commentators initially expected President Trump to bring the United States and Egypt closer together, and that largely has been the case  The Administration has withheld some foreign assistance for policy reasons on at least one occasion, however, and the United States has not had an ambassador in Cairo since June 30, 2017  As evidence of improved bilateral ties, the U S  Defense Department notified Congress in November 2018 of a major $1 billion sale of defense equipment to Egypt, consisting of 10 AH-64E Apache Attack Helicopters, among other things  The Egyptian Air Force already possesses 45 less advanced versions of the Apache that were acquired between 2000 and 2014  In January 2019, U S  Secretary of State Michael Pompeo delivered a major policy speech at the American University in Cairo, where he stated: "And as we seek an even stronger partnership with Egypt, we encourage President Sisi to unleash the creative energy of Egypt's people, unfetter the economy, and promote a free and open exchange of ideas  The progress made to date can continue " U S  officials have not yet publicly criticized efforts by supporters of President Sisi to advance amendments to the constitution (see above) to extend the possibility of Sisi's continued presidency  Human rights advocates have called for Western governments to withhold assistance to Egypt if the amendments are approved  According to Human Rights Watch , "Al-Sisi's government is encouraged by the continued silence of its allies, and if the US, UK, and France want to avoid the destabilizing consequences of entrenching authoritarian rule in Egypt, they should act now " On February 22, 2019, a bipartisan group of national security experts called on U S  officials to "express strong concern about the amendments to the Egyptian constitution now moving through a rapid approval process " Egypt's poor record on human rights and democratization has sparked regular criticism from U S  officials and some Members of Congress  Since FY2012, Members have passed appropriations legislation that withholds the obligation of FMF to Egypt until the Secretary of State certifies that Egypt is taking various steps toward supporting democracy and human rights  With the exception of FY2014, lawmakers have included a national security waiver to allow the Administration to waive these congressionally mandated certification requirements under certain conditions  Over the last year, the Administration has obligated several tranches of FMF to Egypt, including the following: In September 2018, the Administration obligated $1 billion in FY2018 FMF  Per Section 7041(a)(3)(A) of P L  115-141 , the Consolidated Appropriations Act, FY2018, $300 million in FMF remains withheld from obligation until the Secretary of State certifies that Egypt is taking various steps toward supporting democracy and human rights  In previous acts, the amount withheld had been $195 million  FY2018 FMF for Egypt remains available to be expended until September 30, 2019  In August 2018, the Administration waived the certification requirement in Section 7041(a)(3)(B) of P L  115-31 , the Consolidated Appropriations Act, FY2017, allowing for the obligation of $195 million in FY2017 FMF, which occurred in September 2018  However, according to one report, Senator Patrick Leahy has placed a hold on $105 million in FY2017 FMF and is seeking more information on the plight of detained Egyptian-American Moustafa Kassem  In January 2018, the Administration notified Congress of its intent to obligate $1 039 billion in FY2017 FMF out of a total of $1 3 billion appropriated for FY2017  It chose not to obligate $65 7 million in FY2017 FMF  The remaining $195 million had been withheld until a national security waiver was issued in August 2018 (see above)  For FY2019, the President requested a total of $1 381 billion in foreign assistance for Egypt, the same amount requested for the previous year  Nearly all of the requested funds for Egypt are for the FMF account  For FY2020, the request is nearly identical from previous years, as the President is seeking a total of $1 382 billion in bilateral assistance for Egypt  The FY2019 Omnibus ( P L  116-6 ) provides the following for Egypt: a total of $1 419 billion in bilateral U S  foreign assistance for Egypt, of which $1 3 billion is in FMF, $112 5 million in ESF, $3 million in NADR, $2 million in INCLE, and $1 8 million in IMET; and a reauthorization of ESF to support future loan guarantees to Egypt; P L  116-6 sets the following conditions for Egypt: As in previous years, it requires that funds may only be made available when the Secretary of State certifies that the government of Egypt is sustaining the strategic relationship with the United States and meeting its obligations under the 1979 Egypt-Israel Peace Treaty  As in previous years, the act withholds ESF that "the Secretary determines to be equivalent to that expended by the United States Government for bail, and by nongovernmental organizations for legal and court fees, associated with democracy-related trials in Egypt until the Secretary certifies and reports to the Committees on Appropriations that the Government of Egypt has dismissed the convictions issued by the Cairo Criminal Court on June 4, 2013, in Public Prosecution Case No  1110 for the Year 2012 and has not subjected the defendants to further prosecution or if convicted they have been granted full pardons  " This last condition (bolded) was added in 2019 to account for the acquittal of the 43 foreign defendants in Case 173 (see above)  As in previous years, the FY2019 Omnibus also includes a limitation on ESF, stating that no FY2018 ESF or prior-year ESF "may be made available for a contribution, voluntary or otherwise, to the Civil Associations and Foundations Support Fund, or any similar fund, established pursuant to Law 70 on Associations and Other Foundations Working in the Field of Civil Work [informally known as the NGO law] " As in previous years, the act also includes a provision that withholds $300 million of FMF funds until the Secretary of State certifies that the Government of Egypt is taking effective steps to advance, among other things, democracy and human rights in Egypt  The Secretary of State may waive this certification requirement, though any waiver must be accompanied by, among other things, an assessment of the Government of Egypt's compliance with United Nations Security Council Resolution 2270 and other such resolutions regarding North Korea  There has been some concern in the Administration and Congress over Egypt's alleged weapons procurement from North Korea in recent years  P L  115-245 , the Department of Defense (DOD) and Labor, Health and Human Services, and Education Appropriations Act, 2019 and Continuing Appropriations Act, 2019, specifies that the Secretary of Defense may provide Egypt with funds from the Counter-ISIS Train and Equip Fund (CTEF) to enhance its border security  To date, Egypt has not received security assistance from DOD-managed accounts  Between 1946 and 2016, the United States provided Egypt with $78 3 billion in bilateral foreign aid (calculated in historical dollars—not adjusted for inflation)  The 1979 Peace Treaty between Israel and Egypt ushered in the current era of U S  financial support for peace between Israel and its Arab neighbors  In two separate memoranda accompanying the treaty, the United States outlined commitments to Israel and Egypt, respectively  In its letter to Israel, the Carter Administration pledged to "endeavor to take into account and will endeavor to be responsive to military and economic assistance requirements of Israel " In his letter to Egypt, former U S  Secretary of Defense Harold Brown wrote the following: In the context of the peace treaty between Egypt and Israel, the United States is prepared to enter into an expanded security relationship with Egypt with regard to the sales of military equipment and services and the financing of, at least a portion of those sales, subject to such Congressional review and approvals as may be required  All U S  foreign aid to Egypt (or any foreign recipient) is appropriated and authorized by Congress   The 1979 Egypt-Israel Peace Treaty is a bilateral peace agreement between Egypt and Israel, and the United States is not a legal party to the treaty  The treaty itself does not include any U S  aid obligations, and any assistance commitments to Israel and Egypt that could be potentially construed in conjunction with the treaty were through ancillary documents or other communications and were—by their terms—subject to congressional approval (see above)  However, as the peace broker between Israel and Egypt, the United States has traditionally provided foreign aid to both countries to ensure a regional balance of power and sustain security cooperation with both countries  In some cases, an Administration may sign a bilateral "Memorandum of Understanding" (MOU) with a foreign country pledging a specific amount of foreign aid to be provided over a selected time period subject to the approval of Congress  In the Middle East, the United States has signed foreign assistance MOUs with Israel and Jordan  Currently, there is no U S -Egyptian MOU specifying a specific amount of total U S  aid pledged to Egypt over a certain time period  Congress typically specifies a precise allocation of most foreign assistance for Egypt in the foreign operations appropriations bill  Egypt receives the bulk of foreign aid funds from three primary accounts: Foreign Military Financing (FMF), Economic Support Funds (ESF), and International Military Education and Training (IMET)  The United States offers IMET training to Egyptian officers in order to facilitate U S -Egyptian military cooperation over the long term  Since the 1979 Israeli-Egyptian Peace Treaty, the United States has provided Egypt with large amounts of military assistance  U S  policymakers have routinely justified this aid to Egypt as an investment in regional stability, built primarily on long-running military cooperation and sustaining the treaty—principles that are supposed to be mutually reinforcing  Egypt has used U S  military aid through the FMF to (among other things) purchase major U S  defense systems, such as the F-16 fighter aircraft, the M1A1 Abrams battle tank, and the AH-64 Apache attack helicopter  For decades, FMF grants have supported Egypt's purchases of large-scale conventional military equipment from U S  suppliers  However, as mentioned above, the Obama Administration announced that future FMF grants may only be used to purchase equipment specifically for "counterterrorism, border security, Sinai security, and maritime security" (and for sustainment of weapons systems already in Egypt's arsenal)  It is not yet clear how the Trump Administration will determine which U S -supplied military equipment would help the Egyptian military counter terrorism and secure its land and maritime borders  Overall, some defense experts continue to view the Egyptian military as inadequately prepared, both doctrinally and tactically, to face the threat posed by terrorist/insurgent groups such as Sinai Province  According to a former U S  National Security Council official, "they [the Egyptian military] understand they have got a problem in Sinai, but they have been unprepared to invest in the capabilities to deal with it " To reorient the military toward unconventional warfare, the Egyptian military needs, according to one assessment, "heavy investment into rapid reaction forces equipped with sophisticated infantry weapons, optics and communication gear     backed by enhanced intelligence, surveillance and reconnaissance platforms  In order to transport them, Egypt would also need numerous modern aviation assets " In addition to substantial amounts of annual U S  military assistance, Egypt has benefited from certain aid provisions that have been available to only a few other countries  For example Early Disbursal and Interest - Bearing Account : Between FY2001 and FY2011, Congress granted Egypt early disbursement of FMF funds (within 30 days of the enactment of appropriations legislation) to an interest-bearing account at the Federal Reserve Bank of New York  Interest accrued from the rapid disbursement of aid has allowed Egypt to receive additional funding for the purchase of U S -origin equipment  In FY2012, Congress began to condition the obligation of FMF, requiring the Administration to certify certain conditions had been met before releasing FMF funds, thereby eliminating their automatic early disbursal  However, Congress has permitted Egypt to continue to earn interest on FMF funds already deposited in the Federal Reserve Bank of New York  The Excess Defense Articles (EDA) program provides one means by which the United States can advance foreign policy objectives—assisting friendly and allied nations through provision of equipment in excess of the requirements of its own defense forces  The Defense Security Cooperation Agency (DSCA) manages the EDA program, which enables the United States to reduce its inventory of outdated equipment by providing friendly countries with necessary supplies at either reduced rates or no charge  As a designated "major non-NATO ally," Egypt is eligible to receive EDA under Section 516 of the Foreign Assistance Act and Section 23(a) of the Arms Export Control Act  Over the past two decades, U S  economic aid to Egypt has been reduced by over 90%, from $833 million in FY1998 to a request of $75 million for FY2019  Beginning in the mid to late 1990s, as Egypt moved from an impoverished country to a lower-middle-income economy, the United States and Egypt began to rethink the assistance relationship, emphasizing "trade not aid " Congress began to scale back economic aid both to Egypt and Israel due to a 10-year agreement reached between the United States and Israel in the late 1990s known as the "Glide Path Agreement," which gradually reduced U S  economic aid to Egypt to $400 million by 2008  U S  economic aid to Egypt stood at $200 million per year by the end of the George W  Bush Administration, whose relations with then-President Hosni Mubarak suffered over the latter's reaction to the Administration's democracy agenda in the Arab world  During the final years of the Obama Administration, distrust of U S  democracy promotion assistance led the Egyptian government to obstruct many U S -funded economic assistance programs  According to the Government Accountability Office (GAO), the Department of State and the U S  Agency for International Development (USAID) reported hundreds of millions of dollars ($460 million as of 2015) in unobligated prior year ESF funding  As these unobligated balances grew, it created pressure on the Obama Administration to reobligate ESF funds for other purposes  In 2016, the Obama Administration notified Congress that it was reprogramming $108 million of ESF that had been appropriated for Egypt in FY2015 but remained unobligated for other purposes  The Administration claimed that its actions were due to "continued government of Egypt process delays that have impeded the effective implementation of several programs " In 2017, the Trump Administration also reprogrammed FY2016 ESF for Egypt  U S  economic aid to Egypt is divided into two components: (1) USAID-managed programs (public health, education, economic development, democracy and governance); and (2) the U S -Egyptian Enterprise Fund  Both are funded primarily through the Economic Support Fund (ESF) appropriations account  


Report 2: Black lung benefits include both cash assistance and medical benefits  Maximum cash assistance payments generally ranged from about $650 to $1,300 per month in fiscal year 2017, depending on the number of dependents the miner has  Miners receiving cash assistance are also eligible for medical benefits that cover the treatment of their black-lung- related conditions, which may include hospital and nursing care, rehabilitation services, and drug and equipment charges, according to DOL documentation  DOL estimates that the average annual cost for medical treatment in fiscal year 2017 was approximately $6,980 per miner  There were about 25,700 total beneficiaries (primary and dependents) receiving black lung benefits during fiscal year 2017 (see fig  1)  The decrease in the number of beneficiaries over time has resulted from a combination of declining coal mining employment and an aging beneficiary population, according to DOL officials  Further, black lung beneficiaries could increase in the near term due to the increased occurrence of black lung disease and its most severe form, progressive massive fibrosis, particularly among Appalachian coal miners, according to HHS officials  Black lung claims are processed by DOL’s Office of Workers’ Compensation Programs  Contested claims are adjudicated by DOL’s Office of Administrative Law Judges, which issues decisions that can be appealed to the Benefits Review Board  Claimants and mine operators may further appeal these agency decisions to the federal courts  If an award is contested, claimants can receive interim benefits, which are generally paid from the Trust Fund according to DOL officials, while their claims are in the appeals process  Final awards are either funded by mine operators—who are identified as the responsible employers of claimants—or the Trust Fund, when responsible employers cannot be identified or do not pay  In fiscal year 2017, black lung claims had an approval rate of about 29 percent, according to DOL data  Of the 19,430 primary black lung beneficiaries receiving benefits during fiscal year 2017, 64 percent (12,464) were paid from the Trust Fund, 25 percent (4,798) were paid by liable mine operators, and 11 percent (2,168) were receiving interim benefits, according to DOL officials  Black Lung Disability Trust Fund revenue is primarily obtained from mine operators through the coal tax  The coal tax is imposed at two rates, depending on whether the coal is extracted from underground or surface mines  The current tax rates are $1 10 per ton of underground-mined coal and $0 55 per ton of surface-mined coal, up to 4 4 percent of the sales price  Therefore, if a ton of underground-mined coal is sold for less than $25, than the tax paid would be less than $1 10  For instance, if a ton of underground-mined coal sold for $20, than it would be taxed at 4 4 percent of the sales price, or $0 88  To a lesser extent, the Trust Fund also receives other miscellaneous revenue from interest payments, and various fines and penalties paid by mine operators, among other sources, according to DOL documentation  Coal tax revenue is collected from mine operators by Treasury’s Internal Revenue Service and then transferred to the Trust Fund where it is then used by DOL officials to pay black lung benefits and the costs of administering the program  Trust Fund expenditures include, among other things, black lung benefit payments, certain administrative costs incurred by DOL and Treasury to administer the black lung benefits program, and debt repayments  When necessary for the Trust Fund to make relevant expenditures under federal law, the Trust Fund borrows from the Treasury’s general fund  When this occurs, the federal government is essentially borrowing from itself—and hence from the general taxpayer—to fund its benefit payments and other expenditures  Multiple factors have challenged Trust Fund finances since it was established about 40 years ago  Its expenditures have consistently exceeded its revenue, interest payments have grown, and legislative actions taken that were expected to improve Trust Fund finances did not completely address its debt  Combined black lung benefit payments and program administrative costs exceeded Trust Fund revenue every year for the program’s first decade (fiscal years 1979 through 1989), resulting in the accrual of debt  During the Trust Fund’s first three fiscal years in particular, revenue covered less than 40 percent of the Trust Fund’s combined benefit payments and administrative costs  For instance, in fiscal year 1980, the Trust Fund received about $251 million in revenue and paid about $726 million in black lung benefits and administrative costs  Beginning in 1982, revenue increased as a result of the Black Lung Benefits Revenue Act of 1981 that doubled the coal tax rates from $0 50 to $1 per ton of underground-mined coal and from $0 25 to $0 50 per ton of surface-mined coal, up to 4 percent of the sales price  Even with the tax rate increase, combined benefit payments and administrative costs continued to exceed revenue throughout the 1980s (see fig  2)  As a result, the Trust Fund borrowed from Treasury’s general fund to cover the annual differences between its expenditures and revenues, and by fiscal year 1989 the Trust Fund’s outstanding debt to Treasury’s general fund exceeded $3 billion  Beginning in fiscal year 1990, Trust Fund revenue generally began to exceed combined benefit payments and administrative costs, and, in fact, total Trust Fund cumulative revenue collected from fiscal years 1979 through 2017 exceeded total cumulative benefit payments and administrative costs incurred during these years  However, interest owed from earlier years of borrowing led to more borrowing and debt  From fiscal years 1979 through 1989, the Trust Fund borrowed—primarily through 30-year term loans according to Treasury officials—from Treasury’s general fund at interest rates that varied from about 6 5 percent to about 13 9 percent  In fiscal year 1985, for instance, the Trust Fund paid about $275 million in interest, which was equal to about half of the total revenue collected that year  Since fiscal year 1990, revenue has generally exceeded combined benefit payments and administrative costs, although interest payments on the Trust Fund’s outstanding debt kept the fund in a position whereby its total expenditures continued to exceed its total revenues  As a result, the principal amount of the Trust Fund’s total outstanding debt to Treasury’s general fund increased and exceeded $10 billion by fiscal year 2008  Legislation has been enacted over the years that was expected to improve Trust Fund finances: In 1981, the Black Lung Benefits Revenue Act of 1981 doubled the coal tax rates from $0 50 cents to $1 per ton of underground-mined coal, and from $0 25 cents to $0 50 cents per ton of surface-mined coal, up to 4 percent of the sales price (as mentioned previously)  In 1986, the Consolidated Omnibus Budget Reconciliation Act of 1985 established a 5 year moratorium on interest accrual with respect to repayable advances to the Trust Fund (which we refer to as annual borrowing from Treasury’s general fund), and increased the coal tax rates to $1 10 per ton of underground-mined coal, and $0 55 per ton of surface-mined coal (up to 4 4 percent of the sales price), where they have remained since  In 2008, the EIEA included provisions that were expected to eliminate the Trust Fund’s debt  Specifically, EIEA (1) generally extended the coal tax rates at their current rates until December 31, 2018 (after which they are scheduled to decrease to their original levels of $0 50 per ton of underground-mined coal, and $0 25 per ton of surface- mined coal, up to 2 percent of the sales price); (2) provided for a one- time federal appropriation toward Trust Fund debt forgiveness (about $6 5 billion, according to DOL data); and (3) provided for the refinancing of the Trust Fund’s debt that was not forgiven as a result of EIEA (which we refer to as the Trust Fund’s legacy debt)  Specifically, the Trust Fund’s legacy debt was refinanced with more favorable interest rates, according to DOL data  Interest rates on the refinanced legacy debt range from about 1 4 percent to about 4 5 percent  The forgiveness and refinancing of Trust Fund debt along with extending the current coal tax rates through 2018 were expected to result in annual tax revenue that could be used to pay down interest and principal on the Trust Fund’s legacy debt, according to DOL and Treasury officials  These officials said that models showed that debt would be eliminated by fiscal year 2040; however, they noted that coal tax revenue has been less than originally projected due, in part, to the 2008 recession and increased market competition from other energy sources  As a result, the Trust Fund’s total expenditures continued to exceed revenue and the Trust Fund borrowed from Treasury’s general fund each year from fiscal years 2010 through 2017 to cover debt repayments expenditures  In fiscal year 2017, the Trust Fund’s total principal amount of outstanding debt, which includes its legacy debt and the amount borrowed from Treasury’s general fund that year, was about $4 3 billion (see fig  3)  Trust Fund borrowing will likely continue to increase from fiscal years 2019 through 2050 due, in part, to the scheduled coal tax rate decrease of about 55 percent that will take effect in 2019 and declining coal production, according to our moderate simulation  We simulated the effects of the scheduled 2019 tax rate decrease on Trust Fund finances through 2050, and in this report, we generally present the results of a moderate case set of assumptions (see table 1)  These simulations are not predictions of what will happen, but rather models of what could happen given certain assumptions  For more information on our simulation methodology see appendix I  In addition to the moderate case assumptions, we also simulated how Trust Fund debt could change through 2050 given various other assumptions, and the full range of results for all of our simulations are presented in appendix II  Our moderate case simulation suggests that Trust Fund revenue may decrease, from about $485 million in fiscal year 2018 to about $298 million in fiscal year 2019, due, in part, to the scheduled approximate 55 percent decrease in the coal tax  Our simulation, which incorporates EIA data on future expected coal production, also shows that annual Trust Fund revenue will likely continue to decrease beyond fiscal year 2019 due, in part, to declining coal production  Domestic coal production has declined from about 1 2 billion tons in 2008 to about 728 million tons in 2016, according to EIA  Based on these projections, our moderate simulation shows that Trust Fund annual revenue may continue to decrease from about $298 million in fiscal year 2019 to about $197 million in fiscal year 2050 (see fig  4)  With the scheduled 2019 tax rate decrease, our moderate case simulation suggests that expected revenue will likely be insufficient to cover combined black lung benefit payments and administrative costs, as well as debt repayment expenditures  Specifically, our moderate case simulation suggests that revenue may not be sufficient to cover beneficiary payments and administrative costs from fiscal years 2020 through 2050 (see fig  5)  For instance, in fiscal year 2029, simulated benefit payments and administrative costs will likely exceed simulated revenue by about $99 million  These annual deficits will likely decrease over time to about $4 million by fiscal year 2050 due, in part, to the assumed continued net decline in total black lung beneficiaries  Our simulation also therefore suggests that Trust Fund revenue may not be enough to also cover the debt repayment expenditures it must continue to make through fiscal year 2040, per the payment schedule established following the 2008 EIEA  Our moderate simulation suggests that the amount borrowed by the Trust Fund will likely increase from about $1 6 billion in fiscal year 2019 to about $15 4 billion in fiscal year 2050 (see fig  6)  Although the Trust Fund’s legacy debt decreases through fiscal year 2040, total Trust Fund expenditures—including combined benefit payments and administrative costs as well as debt repayments—will likely continue to exceed revenue which will require continued annual borrowing from Treasury’s general fund  However, the amount borrowed by the Trust Fund could vary depending, in part, on future coal production and the number of new beneficiaries and could range between about $6 billion and about $27 billion in 2050, according to our simulations (see appendix II)  We simulated three options that can affect Trust Fund finances through fiscal year 2050  Specifically, we simulated the effects of (1) adjusting the coal tax, (2) forgiving interest, and (3) forgiving debt  In each of the simulations, we compared the results of the option to a baseline in which the coal tax rates will decrease by about 55 percent, which we refer to as the scheduled 2019 tax rate decrease  We compare interest and debt forgiveness options to a baseline which assumes the scheduled 2019 tax rate decrease has taken effect, and that there is no interest or debt forgiveness  The simulated options are not intended to be exhaustive and we are not endorsing any particular option or combination of options  Using the moderate case, we simulated four options: (1) implementing the 2019 coal tax rate reduction to $0 50 per ton of underground-mined coal and $0 25 per ton of surface-mined coal; (2) maintaining the current coal tax rates of $1 10 per ton for underground-mined coal and $0 55 per ton of surface-mined coal; (3) reducing the tax rates by 25 percent (from $1 10 and $0 55); and (4) increasing these tax rates by 25 percent (see fig  7)  Increasing the tax rates by 25 percent was the only option that eliminated simulated Trust Fund debt by fiscal year 2050, according to our moderate case simulation  We simulated three interest forgiveness options including forgiving interest on (1) legacy debt, (2) annual borrowing, and (3) all debt  Our moderate case simulation suggests that forgiving interest will not eliminate simulated debt by fiscal year 2050 (see fig  8)  We simulated two debt forgiveness options by forgiving principal and interest on (1) legacy debt and (2) all debt  Our moderate case simulation suggests that both debt forgiveness options would reduce simulated Trust Fund borrowing by fiscal year 2050, but these options would not eliminate debt altogether as simulated revenue will likely not be enough to cover simulated expenditures (see fig  9)  In these cases, the Trust Fund will need to continue borrowing from Treasury’s general fund to cover annual deficits, and thus accumulate debt  While adjusting coal tax rates and forgiving interest or debt could reduce the Trust Fund’s simulated borrowing by 2050, implementing them could affect the coal industry or general taxpayers, according to stakeholders we interviewed  For instance, a coal industry representative noted that maintaining the coal tax at its current rate would continue to burden the coal industry and increasing the tax would exacerbate the burden at a time when coal production has been declining  Treasury officials noted that the costs associated with forgiving Trust Fund interest or debt would be borne by the general taxpayer since Treasury borrows from taxpayers to lend to the Trust Fund as needed  These officials also said that making a one-time federal appropriation to forgive interest or debt would be the most transparent way to satisfy the Trust Fund’s outstanding debt to Treasury’s general fund  In addition to the simulations, other options could affect the financial position of the Trust Fund including reducing black lung benefits, eliminating or adjusting the coal tax cap, or creating a variable coal tax  Our moderate case simulation suggests that completely eliminating black lung benefits as of fiscal year 2019 could reduce the Trust Fund’s borrowing from Treasury’s general fund in fiscal year 2050 from about $15 4 billion to about $6 4 billion  However, doing so would generally mean that coal tax revenue would be collected solely to fund the repayment of Trust Fund debt  Another option could be to eliminate or adjust the coal tax cap, which currently prevents mine operators from paying a coal tax of more than 4 4 percent of the price per ton of coal sold  If the coal tax cap were eliminated, for instance, mine operators would pay $1 10 per ton of underground-mined coal and $0  55 per ton of surface-mined coal regardless of price sold, which could increase revenue  As an additional option, changing the structure of the coal tax to flexible rates that change based on an annual actuarial assessment of the Trust Fund could help to ensure that coal mine operators pay the necessary amount of tax to cover Trust Fund expenditures, without resulting in a Trust Fund balance or deficit  Multiple options could reduce the Trust Fund’s future debt and distribute the financial burden among the coal industry and general taxpayers  We simulated whether various coal tax and debt forgiveness options could balance the Trust Fund by fiscal year 2050, whereby its simulated revenue would be sufficient to cover its simulated expenditures  These options were selected, in part, based on interviews with Trust Fund stakeholders and the availability of DOL and other data  We approached these simulations from two perspectives  First, we simulated how much Trust Fund debt would need to be forgiven based on various coal tax rates  Second, we simulated the average tax collected per ton needed to balance the Trust Fund by 2050, based on certain debt forgiveness options  The simulated options are not intended to be exhaustive and we are not endorsing any particular combination of options  Our first set of options using the moderate case simulations are based on the current coal tax rates of $1 10 per ton of underground-mined coal and $0 55 per ton of surface-mined coal, and show the amount of debt forgiveness in fiscal year 2019 needed to balance the Trust Fund by fiscal year 2050 based on certain tax rates (see fig  10)  Specifically, our moderate case simulations show the following: Increasing current coal tax rates by 25 percent could balance the Trust Fund by 2050 and would likely require no debt forgiveness  For this option, the simulated coal tax revenue would likely be sufficient to cover simulated Trust Fund expenditures, including combined benefit payments and administrative costs, as well as debt repayments  However, this option would place the burden solely on the coal industry that would be paying higher taxes at a time when coal production has been declining  Maintaining current coal tax rates could balance the Trust Fund by 2050 if coupled with about $2 4 billion of debt forgiveness  This option would distribute the burden among the coal industry and general taxpayers  Decreasing current coal tax rates by 25 percent could balance the Trust Fund by 2050 if coupled with about $4 8 billion in debt forgiveness  This option would burden the coal industry less than maintaining the current tax rates, but would increase the burden on general taxpayers  Decreasing current tax rates by 55 percent, which we refer to as the scheduled 2019 tax rate decrease, would balance the Trust Fund by 2050 if coupled with about $7 8 billion in debt forgiveness  This figure comprises the Trust Fund’s total simulated outstanding debt in fiscal year 2019 ($6 6 billion), and an additional about $1 2 billion that would be required because the Trust Fund will accrue additional debt from fiscal years 2020 through 2050, according to our moderate case simulations  The coal industry would bear some of the financial burden of this option, while also placing a financial burden on general taxpayers  Our second set of options using moderate case simulations show the change in average coal tax revenue collected per ton to balance the Trust Fund by fiscal year 2050 based on certain debt forgiveness options (see fig  11)  Specifically, our moderate simulations show the following: Forgiving the Trust Fund’s legacy debt would allow for an average tax collected of about $0 59 per ton to balance the Trust Fund by 2050  Based on certain assumptions, this could be accomplished with a tax of $0 88 per ton on underground-mined coal and $0 44 per ton on surface-mined coal  Forgiving all Trust Fund debt would allow for an average tax collected per ton of coal sold of $0 47 per ton to balance the Trust Fund by 2050  Based on certain assumptions, this could be accomplished with a tax of $0 70 per ton on underground-mined coal and a tax of $0 35 per ton of surface-mined coal  We provided a draft of this report to the Departments of Labor (DOL), Treasury, and Health and Human Services (HHS) for review and comment  DOL, Treasury, and HHS provided technical comments, which we incorporated as appropriate  As agreed with your offices, unless you publicly announce the contents of this report earlier, we plan no further distribution until 30 days from the report date  At that time we will send copies of this report to the appropriate congressional committees, the Secretaries of Labor, Treasury, and Health and Human Services, and other interested parties  In addition, the report will be available at no charge on GAO’s web site at http://www gao gov  If you or your staff should have any questions about this report, please contact me at (202) 512-7215 or brownbarnesc@gao gov  Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report  GAO staff who made key contributions to this report are listed in appendix III  We examined the extent to which (1) Black Lung Disability Trust Fund (Trust Fund) debt may change through 2050 and (2) selected options to improve its future financial position  We interviewed officials from the Departments of Labor (DOL), Treasury, and Health and Human Services (HHS), as well as representatives from the National Mining Association and the United Mine Workers of America  We then selected options to simulate based, in part, on these interviews and the availability of DOL and other data  These options included adjusting the coal tax, forgiving interest on some or all Trust Fund debt, forgiving some or all Trust Fund debt, or various combinations of these options  The options we simulated are not intended to be exhaustive and we are not endorsing any particular option or combination of options  Our simulations are based on various assumptions and simulate Trust Fund revenues and expenditures from fiscal years 2016 through 2050  To develop these simulations, we used actual and projection data from (1) DOL for fiscal years 2015 through 2040; (2) Treasury’s Office of Tax Analysis for fiscal years 2011 through 2015; (3) the Department of Energy’s Energy Information Administration (EIA) for calendar years 2015 through 2050; and (4) the Office of Management and Budget for fiscal year 2017  To simulate future Trust Fund benefit expenditures, we simulated the number of beneficiaries each fiscal year, and the annual average amount of benefits received (cash assistance and medical benefits)  To simulate the numbers of beneficiaries, we used DOL data on the (1) age distributions of miner and widow beneficiaries for fiscal year 2015; (2) mortality rates by age for miner and widow beneficiaries as of fiscal year 2015; and (3) numbers of beneficiaries—including married miners, single miners, widows, and miners receiving medical benefits only—in fiscal year 2015  We assumed—as DOL does in its Black Lung Budget and Liability Model—that all miners are men, all widows are women, and all spouses are 3 years younger than the miner  We also assumed that the age distribution of single miners is the same as for married miners, and that the age distribution of new miner and widow beneficiaries is the same as for miner and widow beneficiaries during fiscal year 2015  We used DOL’s mortality rates to simulate the number of beneficiaries of each age and type in each year, and used those numbers to then simulate the total number of beneficiaries of each type each year (see table 2)  We also assumed that there will be no new medical-benefit-only recipients  Formula The number of married miner beneficiaries age a in fiscal year y is equal to the number of new married miner beneficiaries age a in fiscal year y plus the number of married miner beneficiaries age a-1 in fiscal year y-1 who survived and whose spouse survived  The total number of married miner beneficiaries in fiscal year y is then the sum of the number of married miner beneficiaries of all ages in fiscal year y  Finally, we averaged the number of married miner beneficiaries by averaging the prior fiscal year’s total and the current fiscal year’s total  The number of single miner beneficiaries age a in fiscal year y is equal to the number of new single miner beneficiaries age a in fiscal year y plus the number of single miner beneficiaries age a-1 in fiscal year y-1 who survived plus the number of married miner beneficiaries age a-1 in fiscal year y-1 who survived but whose spouse did not survive  The total number of single miner beneficiaries in fiscal year y is then the sum of the number of single miner beneficiaries of all ages in fiscal year y  Finally, we averaged the number of single miner beneficiaries by averaging the prior fiscal year’s total and the current fiscal year’s total  The number of widow beneficiaries age a in fiscal year y is equal to the number of new beneficiaries who are widows age a in fiscal year y plus the number of widow beneficiaries age a-1 in fiscal year y-1 who survived plus the number of married miner beneficiaries age a+2 in fiscal year y-1 who did not survive but whose spouse did survive  The total number of widow beneficiaries in fiscal year y is then the sum of the number of widow beneficiaries of all ages in fiscal year y  Finally, we averaged the number of widow beneficiaries by averaging the prior fiscal year’s total and the current fiscal year’s total  The number of MBO beneficiaries of age a in fiscal year y is equal to the number of MBO beneficiaries of age a-1 in fiscal year y-1 who survived  The total number of MBO beneficiaries only in fiscal year y is then the sum of the number of MBO beneficiaries of all ages in fiscal year y  Finally, we averaged the number of MBO beneficiaries by averaging the prior fiscal year’s total and the current fiscal year’s total  To simulate future coal tax revenue, we used Treasury and EIA data to calculate (1) the amounts of underground and surface-mined coal taxed at fixed dollar amounts of $1 10 and $0 55 per ton, respectively, in 2015; (2) the amounts of underground and surface-mined coal taxed at variable dollar amounts per ton equal to 4 4 percent of the price in 2015; and (3) average prices of underground and surface-mined coal taxed at 4 4 percent of the price in 2015  We then used EIA data on projected amounts of total coal production, underground-mined coal production, lignite coal production, and coal exports, as well as projected average coal prices, for the period from 2015 through 2050 to simulate future coal tax revenues (see table 3)  We simulated other Trust Fund expenditures and revenues, including administrative costs and debt repayments (see table 4)  For our simulations, total Trust Fund expenditures are the sum of black lung benefits (cash assistance and medical benefits), total administrative costs, repayment of interest and principal on outstanding debt to Treasury’s general fund, and other expenditures  Total Trust Fund revenues are the sum of coal tax revenue and other miscellaneous revenue, and exclude annual borrowing from Treasury’s general fund  Annual borrowing from Treasury’s general fund is the difference between total Trust Fund expenditures and revenues and is assumed to be repaid with interest the following year  If total revenues are greater than total expenditures, then the Trust Fund has a balance and would not have to borrow that year  In this case, we assumed that the Trust Fund will earn interest on that balance at the same rate on which interest would accrue on annual borrowing  We simulated how the scheduled 2019 tax rate decrease and various options including adjusting the coal tax, forgiving debt interest, and forgiving debt principal and interest may affect Trust Fund finances through fiscal year 2050 (see table 5)  The options listed are not intended to be exhaustive and we are not endorsing any particular option or combination of options  We simulated option combinations for coal tax rates, interest forgiveness, and debt forgiveness to demonstrate how potential financial adjustments could affect future Trust Fund borrowing from Treasury’s general fund through fiscal year 2050  For options that involve adjusting coal tax rates, we estimated the amount of debt that would need to be forgiven in fiscal year 2019 for the Trust Fund’s revenues to be sufficient to cover its expenditures through fiscal year 2050, assuming the Trust Fund does not borrow from Treasury’s general fund after fiscal year 2018  To do so, we first calculated the real discounted present value of Trust Fund expenditures for fiscal years 2019 through 2050, including benefit payments, administrative costs, legacy debt repayments, and repayment of annual borrowing from Treasury’s general fund  Second, we calculated the real discounted present value of Trust Fund revenue for the same period, including coal tax revenue and other miscellaneous revenue  Third, we calculated debt forgiveness as the difference between the real discounted present value of Trust Fund expenditures from the first calculation and the real discounted present value of Trust Fund revenues from the second calculation  When the amount of debt forgiveness is greater than the amount of debt outstanding, the Trust Fund would need an additional cash inflow in addition to forgiveness of all outstanding debt  Amounts of debt forgiveness less than zero suggest that no debt forgiveness is required  For options involving forgiving debt (interest or principal), we estimated the average tax per ton of coal that, if implemented in fiscal year 2019, would provide the Trust Fund sufficient revenue to cover its expenditures through fiscal year 2050, assuming the Trust Fund does not receive any advances from Treasury’s general fund after fiscal year 2018  To do so, we first calculated the real discounted present value of Trust Fund expenditures for the period from fiscal year 2019 through fiscal year 2050, again including benefit payments, administrative costs, legacy debt repayments, and repayment of annual borrowing from Treasury’s general fund, minus the real discounted present value of miscellaneous revenues for the same period  Second, we calculated the real discounted present value of coal production for the same period  Third, we calculated the average tax per ton of coal as the first amount divided by the second amount  To assess the sensitivity of each option, we ran each simulation 36 times using four different sets of assumptions about the numbers of future beneficiaries and nine different sets of assumptions about future coal production and prices (see table 6)  Doing so provided a range of estimates about the Trust Fund’s future borrowing needs and provided insight on the sensitivity of its overall financial position relative to its various expenditures and revenues  The analysis also provided a range of estimates of the amount of debt forgiveness needed to bring the Trust Fund into balance by fiscal year 2050, assuming various coal tax rates, and the average tax collection per ton needed to do the same, and assuming various amounts of debt forgiveness  From the range of estimates that resulted from our sensitivity analysis, we selected cases with moderate expectations related to future Trust Fund expenditures and revenue  Specifically, for future expenditures, we assumed an average growth rate of new black lung beneficiaries for fiscal years 2003 through 2015 as a moderate case that reflects historical experience  For future revenue, we used a moderate coal production outlook based on EIA’s reference case, which reflects moderate expectations about future coal production based on various assumptions about economic growth, oil prices, technological innovation, and energy policy  We summarized the results of our simulations by showing the extent to which the Black Lung Disability Trust Fund’s (Trust Fund) balance—the sum of tax revenue and miscellaneous revenue less expenditures—may change in fiscal year 2050 for each option simulated  For example, with the scheduled 2019 tax rate decrease, our moderate case simulations suggest that the Trust Fund would likely have a deficit in fiscal year 2050 of about $15 4 billion  Multiple options could reduce the Trust Fund’s future debt and distribute the financial burden among the coal industry and general taxpayers  We simulated how various coal tax and debt forgiveness options could balance the Trust Fund by fiscal year 2050, whereby its simulated revenue would be sufficient to cover its simulated expenditures  We approached these simulations from two perspectives  First, we simulated how much Trust Fund debt would need to be forgiven based on various coal tax rates  Second, we simulated the average tax collected per ton needed to balance the Trust Fund by 2050, based on certain debt forgiveness options  For our first set of simulations, we calculated the amount of debt outstanding in fiscal year 2019 and the amount that would likely need to be forgiven in fiscal year 2019 for the Trust Fund to have sufficient revenues to cover its expenditures by fiscal year 2050, assuming that it does not borrow from Treasury’s general fund after fiscal year 2018  For example, before any options are implemented, our moderate case simulations suggest that the Trust Fund’s outstanding debt in fiscal year 2019—including both legacy debt and annual borrowing from Treasury’s general fund—would likely be about $6 6 billion (after discounting and adjusting for inflation)  Therefore, with implementation of the coal tax rate decrease of about 55 percent as scheduled in calendar year 2019, about 117 7 percent of that debt would need to be forgiven to balance the Trust Fund  In other words, balancing the Trust Fund would require forgiveness of $6 6 billion and an additional cash inflow of about $1 2 billion because the Trust Fund will accrue additional debt from fiscal years 2020 through 2050, according to our moderate case simulations (see table 8)  For our second set of simulations, we estimated the average tax per ton of coal that, if implemented in fiscal year 2019, would likely provide the Trust Fund sufficient revenues to cover its expenditures in fiscal year 2050, assuming that it does not borrow from Treasury’s general fund after fiscal year 2018  For example, if all principal and interest on Trust Fund legacy debt is forgiven, as of 2019, the estimated average tax that balances the Trust Fund is about $0 59 per ton (see table 9)  Based on certain assumptions, this could be accomplished with a tax of $0 88 per ton on underground-mined coal and $0 44 per ton on surface-mined coal  In addition to the contact named above, Blake Ainsworth (Assistant Director), Justin Dunleavy (analyst-in-charge), Angeline Bickner, Courtney LaFountain, and Rosemary Torres Lerma made key contributions to this report  Also contributing to this report were James Bennett, Melinda Bowman, Lilia Chaidez, Caitlin Cusati, Holly Dye, Alex Galuten, Carol Henn, John Lack, Emei Li, Almeta Spencer, Kate van Gelder, and Shana Wallace 

ground_truth: With revenue of about $450 million in fiscal year 2017, the Trust Fund paid about $184 million in benefits to more than 25,000 coal miners and eligible dependents. However, the Trust Fund also borrowed about $1.3 billion from the Treasury's general fund in fiscal year 2017 to cover its debt repayment expenditures. Adding to this financial challenge, the coal tax that supports the Trust Fund is scheduled to decrease by about 55 percent beginning in 2019. GAO was asked to review the financial positon of the Trust Fund and identify options to improve it. This report examines (1) factors that have challenged the financial position of the Trust Fund since its inception and (2) the extent to which Trust Fund debt may change through 2050, and selected options that could improve its future financial position. GAO reviewed Trust Fund financial data from fiscal years 1979 through 2017. GAO also interviewed officials from the Departments of Labor, Treasury, Health and Human Services (HHS) and representatives of coal industry and union groups. Using assumptions, such as the about 55 percent coal tax decrease and moderately declining coal production, GAO simulated the extent to which Trust Fund debt may change through 2050. GAO also simulated how selected options, such as forgiveness of debt, could improve finances. The options simulated are not intended to be exhaustive. Further, GAO is not endorsing any particular option or combination of options. GAO provided a draft of this report to DOL, Treasury, and HHS. The agencies provided technical comments, which were incorporated as appropriate. Multiple factors have challenged Black Lung Disability Trust Fund (Trust Fund) finances since it was established about 40 years ago. Its expenditures have consistently exceeded its revenues, interest payments have grown, and actions taken that were expected to improve Trust Fund finances did not completely address its debt. When necessary to make expenditures, the Trust Fund borrows with interest from the Department of the Treasury's (Treasury) general fund. Because Trust Fund expenditures have consistently exceeded revenue, it has borrowed almost every year since 1979, its first complete fiscal year, and as a result debt and interest payments increased. Legislative actions were taken over the years including (1) raising the rate of the coal tax that provides Trust Fund revenues and (2) forgiving debt. For example, the Energy Improvement and Extension Act of 2008 provided an appropriation toward Trust Fund debt forgiveness; about $6.5 billion was forgiven, according to Department of Labor (DOL) data (see figure). However, coal tax revenues were less than expected due, in part, to the 2008 recession and increased competition from other energy sources, according to DOL and Treasury officials. As a result, the Trust Fund continued to borrow from Treasury's general fund from fiscal years 2010 through 2017 to cover debt repayment expenditures. GAO's simulation suggests that Trust Fund borrowing will likely increase from fiscal years 2019 through 2050 due, in part, to the coal tax rate decrease of about 55 percent that will take effect in 2019 and declining coal production. The simulation estimates that Trust Fund borrowing may exceed $15 billion by 2050 (see figure). However, various options, such as adjusting the coal tax and forgiving interest or debt, could reduce future borrowing and improve the Trust Fund's financial position. For example, maintaining the current coal tax rates and forgiving debt of $2.4 billion could, under certain circumstances, balance the Trust Fund by 2050, whereby revenue would be sufficient to cover expenditures. However, a coal industry representative said that maintaining or increasing the coal tax would burden the coal industry, particularly at a time when coal production has been declining. Further, Treasury officials noted that the costs associated with forgiving Trust Fund interest or debt would be paid by taxpayers.