You are given two reports by the government agency.  

Report 1:
The Small Business Administration (SBA) currently administers several types of programs to support small businesses, including loan guaranty and venture capital programs to enhance small businesses' access to capital; contracting programs to increase small businesses' opportunities in federal contracting; direct loan programs for businesses, homeowners, and renters to aid in their recovery from natural disasters; and small business management and technical assistance training programs to assist in business formation and expansion. Congressional interest in these programs has increased in recent years, primarily because small businesses are viewed as a means to stimulate economic activity and create jobs. Many Members of Congress also regularly receive constituent inquiries about the SBA's programs. This report examines appropriations for the SBA (new budget authority, minus rescissions and sequestration) over time, focusing on developments and trends since FY2000. This report also provides total available funding (which includes carryover from the prior fiscal year, carryover into the next fiscal year, account transfers, rescissions, and sequestration) and, for comparative purposes, actual and anticipated expenditures for the SBA's entrepreneurial development noncredit programs. SBA appropriations, as a whole, have varied significantly from year to year since FY2000 and across all three major SBA spending categories: appropriations for disaster assistance, business loan credit subsidies, and "other programs," a spending category that includes appropriations for salaries and expenses, business loan administration, the Office of Inspector General, the Office of Advocacy, and entrepreneurial development noncredit programs. The variation in appropriations for disaster assistance since FY2000 is largely due to supplemental appropriations provided to address disaster needs arising from the impact of major hurricanes. Business loan credit subsidies represent the net present value of cash flows to and from the SBA over the life of the agency's loan portfolios. For guaranteed loans, the net present value of cash flows is affected by several factors, but it is primarily the difference between the cost of purchasing loans that have defaulted and the revenue generated from fees and collateral liquidation. For direct (Microloan) lending, it is primarily the cost of offering below-market interest rates to Microloan intermediaries. The variation in appropriations for SBA business loan credit subsidies since FY2000 is primarily due to the impact of changing economic conditions on the SBA's guaranteed loan portfolios. During good economic times, revenue from SBA fees and collateral liquidation is typically sufficient to cover the SBA's cost of purchasing guaranteed loans that have defaulted. During and immediately following economic slowdowns, however, revenue from SBA fees and collateral liquidation is typically insufficient to cover the SBA's cost of purchasing guaranteed loans that have defaulted. The shortfall occurs because the SBA's cost of purchasing guaranteed loans tends to increase when the economy slows (primarily because guaranteed loans are more likely to default during and immediately following recessions) and revenue from loan liquidation tends to be constrained during slow economic times (primarily because commercial real estate values typically fall during and immediately following recessions). As a result, additional appropriations are needed to cover these expenses, which are guaranteed by the "full faith and credit of the United States." Since FY2000, the variation in appropriations for the other programs spending category is attributable primarily to congressional response to changing economic conditions. As the report will discuss, appropriations for this spending category have generally increased at a pace that exceeds inflation. In addition, Congress approved significant, temporary increases in appropriations for SBA programs in the other programs spending category in FY2009 and FY2010. It approved these temporary increases primarily as a means to enhance small businesses' access to capital, which had become constrained during and immediately following the Great Recession (December 2007 to June 2009). The SBA's appropriations for FY1954 through FY1999 are provided in the Appendix . As shown in Table 1 , the SBA's appropriations have varied significantly since FY2000, ranging from a high of $2.359 billion in FY2018 to a low of $571.8 million in FY2007. Much of this volatility is due to significant variation in appropriations for disaster assistance, which ranged from a high of $1.7 billion in FY2006 to a low of $0 in FY2009. This variation is attributable primarily to supplemental appropriations provided to address disaster needs arising from the impact of major hurricanes, such as Hurricanes Katrina, Sandy, Harvey, Irma, and Maria. In addition, as shown in Table 1 , appropriations for business loan credit subsidies have varied significantly since FY2000, ranging from a high of $319.7 million in FY2013 ($337.3 million before sequestration and rescission) to a low of $1.3 million in FY2006 and FY2007. As mentioned previously, the variation in appropriations for business loan credit subsidies results primarily from the impact of changing economic conditions on the SBA's loan portfolios. During good economic times, revenue from fees and collateral liquidation is typically sufficient to cover the costs of purchasing defaulted loans. During and immediately following recessions, revenue from fees and collateral liquidation is typically not sufficient to cover those costs. As shown in Table 1 , appropriations for the all other programs category have also varied since FY2000, ranging from a high of $1.6253 billion in FY2010 to a low of $455.6 million in FY2007. Much of this variation resulted from significant, temporary increases in appropriations for the SBA's other programs in FY2009 ($724.0 million) and FY2010 ($962.5 million). These additional appropriations were approved primarily as a means to enhance small businesses' access to capital, which had become constrained during and immediately following the Great Recession. As mentioned previously, from FY2000 to FY2019, appropriations for the SBA's other programs spending category, as a whole, have exceeded the rate of inflation. For comparative purposes, Table 1 also presents the SBA's total available funds. As indicated in the table, the SBA's carryovers and account transfers tend to reduce variation in its budget from one fiscal year to the next. Much of this "evening out" process is due to disaster assistance appropriations, which are provided in one fiscal year and then typically spent over several fiscal years. The following section examines appropriations and total available funding for FY2000-FY2019 for the five main components of the SBA's other programs spending category: (1) salaries and expenses, (2) business loan administration, (3) the Office of Inspector General (OIG), (4) the Office of Advocacy (Advocacy), and (5) entrepreneurial development (ED) noncredit programs. The SBA's salaries and expenses account currently provides funding for the following: office operating budgets, which are used by program and administrative offices for daily operations, such as travel, supplies, and contracted services; agency-wide costs, such as rent and telecommunications, which are managed centrally; employee compensation and benefits, which are also managed centrally; and reimbursable expenses for programs for which the SBA receives reimbursable budget authority from other federal government agencies. Several adjustments were made to the SBA's reported appropriations for its salaries and expenses account to enable meaningful comparisons over time. For example, prior to FY2014, appropriations for the SBA's ED programs were included in the salaries and expenses account. They now have their own, separate appropriations account. Therefore, to allow for meaningful comparisons with current appropriations, Table 2 lists and deducts the reported appropriations for ED programs prior to FY2014 from the reported appropriations for salaries and expenses. In addition, the SBA previously included appropriations for congressional initiatives (earmarks) under the salaries and expenses account. Therefore, to allow for meaningful comparisons with current appropriations and focus the comparison on administrative expenses, appropriations for earmarks are deducted from the reported appropriations for salaries and expenses. Prior to FY2012, Advocacy was funded through the salaries and expenses' executive direction subaccount. Advocacy now has its own, separate appropriations account. To allow for meaningful comparisons with current appropriations, Table 2 lists Advocacy's funding provided through the salaries and expenses' executive direction subaccount prior to FY2012 and deducts that amount from the reported appropriation s for salaries and expenses . As discussed in greater detail below (see "Office of Advocacy"), data concerning Advocacy's funding provided through the salaries and expenses' executive direction subaccount are not available for FY2006-FY2010. However, in FY2003, FY2004, and FY2005, Advocacy's funding provided through the salaries and expenses' executive direction subaccount was 79% of its reported total cost. The estimates provided in the table for FY2006-FY2010 were derived by multiplying Advocacy's total program cost reported for each of those fiscal years by 79%. As shown in Table 2 , the SBA's appropriations for salaries and expenses have varied from year to year, with increases in some years and decreases in others. Overall, appropriations for the SBA's salaries and expenses have increased from $176.490 million in FY2000 to $267.500 million in FY2019. This increase has exceeded the rate of inflation. The SBA has statutory authorization to transfer appropriations from the business loan administration account into the salaries and expenses account. As evidenced by the amounts listed in the total available funds column in the table, the SBA exercised that authority in every fiscal year from FY2000 to FY2018 (and is expected to do so again in FY2019), transferring the entire appropriation for business loan administration into the salaries and expenses account in each of those fiscal years. Appropriations for the SBA's business loan administration account have varied since FY2000, increasing in some years and decreasing in others (see Table 3 ). Overall, appropriations for SBA business loan administration increased from $129 million in FY2000 to $155.150 million in FY2019. The program's recommended appropriations have not kept pace with inflation. As evidenced by the $0.0 balance in the total funds available column for the business loan administration account, the SBA has routinely transferred all business loan administration appropriations to the salaries and expenses account. The combined appropriations for SBA salaries and expenses and business loan administration increased from $305.490 million in FY2000 to $422.650 million in FY2019. This increase has not kept pace with inflation. According to the SBA, the OIG's mission is to "provide independent, objective oversight to improve the integrity, accountability, and performance of the SBA and its programs for the benefit of the American people." The office was created within the SBA by the Inspector General Act of 1978 ( P.L. 95-452 , as amended). The inspector general, who is nominated by the President and confirmed by the Senate, directs the office. The Inspector General Act provides the OIG with the following responsibilities: promote economy, efficiency, and effectiveness in the management of SBA programs and supporting operations; conduct and supervise audits, investigations, and reviews relating to the SBA's programs and support operations; detect and prevent fraud, waste, and abuse; review existing and proposed legislation and regulations and make appropriate recommendations; maintain effective working relationships with other governmental agencies and nongovernmental entities regarding the inspector general's mandated duties; keep the SBA administrator and Congress informed of serious problems and recommend corrective actions and implementation measures; comply with the comptroller general's audit standards; avoid duplication of Government Accountability Office activities; and report violations of federal criminal law to the U.S. attorney general. As shown in Table 4 , the OIG's appropriations have increased from $11.405 million in FY2000 to $21.900 million in FY2019. This increase has exceeded the rate of inflation. The OIG typically receives a transfer of appropriations from the disaster assistance account for auditing expenses. It was also provided additional appropriations in FY2006, FY2013, and FY2018 for expenses related to the review of SBA disaster loans following major hurricanes (e.g., Hurricanes Katrina, Rita, and Wilma in 2005, Hurricane Sandy in 2012, and Hurricanes Harvey, Irma, and Maria in 2018) and in FY2009 to conduct reviews and audits of $730 million provided to the SBA by P.L. 111-5 , the American Recovery and Reinvestment Act of 2009. The SBA indicates that its Office of Advocacy is "an independent voice for small business within the federal government." The chief counsel for Advocacy, who is nominated by the President and confirmed by the Senate, directs the office. Advocacy's mission is to "encourage policies that support the development and growth of American small businesses" by intervening early in federal agencies' regulatory development processes on proposals that affect small businesses and providing Regulatory Flexibility Act compliance training to federal agency policymakers and regulatory development officials; producing research to inform policymakers and other stakeholders on the impact of federal regulatory burdens on small businesses, document the vital role of small businesses in the economy, and explore and explain the wide variety of issues of concern to the small business community; and fostering two-way communication between federal agencies and the small business community. As shown in Table 5 , Advocacy's funding has increased from $5.620 million in FY2000 to $9.120 million in FY2019. This increase has exceeded the rate of inflation. P.L. 111-240 , the Small Business Jobs Act of 2010, enhanced Advocacy's independence by ending the practice of funding Advocacy through the SBA's salaries and expenses' executive direction subaccount. Instead, P.L. 111-240 requires the President to provide a separate statement of the appropriations request for Advocacy, "which shall be designated in a separate account in the General Fund of the Treasury." The act also requires the SBA administrator to provide Advocacy with "appropriate and adequate office space at central and field office locations, together with such equipment, operating budget, and communications facilities and services as may be necessary, and ... necessary maintenance services for such offices and the equipment and facilities located in such offices." In addition, Congress has provided Advocacy its own, separate appropriations amount since FY2012. As mentioned previously, prior to FY2012, the SBA reported Advocacy's total program cost, which includes funding provided through the salaries and expenses' executive direction subaccount, agency-wide overhead costs (rent, telecommunications, etc.), and other support costs (e.g., management and administrative support, including human resources support). From FY2000 to FY2005, the SBA provided relatively detailed information concerning Advocacy's budget, including the amount of funding Advocacy received through the salaries and expenses' executive direction subaccount. Also, Advocacy's FY2013 congressional budget justification document included the amount of funding Advocacy received through the salaries and expenses' executive direction subaccount in FY2011. However, those data are not available for FY2006-FY2010, and it was therefore necessary to estimate Advocacy's funding from the salaries and expenses' executive direction subaccount for those years. The estimates provided in the table were derived by multiplying Advocacy's total program cost for each of those fiscal years by 79%, which was the proportion of Advocacy's total program costs provided from the salaries and expenses' executive direction subaccount in FY2003, FY2004, and FY2005. The SBA's entrepreneurial development (ED) noncredit programs provide a variety of management and training services to small businesses. Congress provides appropriations for eight management and technical assistance training programs: Small Business Development Centers, the Microloan Technical Assistance Program, Women Business Centers, SCORE, the Program for Investment in Microentrepreneurs (PRIME), Veterans Programs (including Veterans Business Outreach Centers, Boots to Business, Boots to Business: Reboot, Veteran Women Igniting the Spirit of Entrepreneurship [VWISE], and Entrepreneurship Bootcamp for Veterans with Disabilities), the 7(j) Technical Assistance Program, and the Native American Outreach Program; two relatively long-standing nontraining programs: the National Women's Business Council and HUBZone administration; three initiatives: the Entrepreneurial Development Initiative (Clusters), the Entrepreneurship Education Initiative, and Growth Accelerators; and the Step Trade and Export Promotion (STEP) Pilot Grant program. Initially, the SBA provided its own management and technical assistance training programs. Over time, however, the SBA has increasingly relied on third parties to provide that training. The SBA reports that more than 1 million aspiring entrepreneurs and small business owners receive training from an SBA-supported resource partner each year. Congress specifies appropriations in appropriations acts for the Small Business Development Center (SBDC) program, the Microloan Technical Assistance program, and the STEP program. Congress provides an overall appropriation for the SBA's ED programs and recommends appropriations for the SBA's other ED programs, typically in the conference agreement or "Explanatory Statement" accompanying the appropriations act. As a result, the following tables refer to appropriations for the SBDC and Microloan Technical Assistance programs and recommended appropriations for other ED programs. Although not legally binding, the SBA has traditionally adhered to these recommended funding amounts. SBDCs provide free or low-cost assistance to small businesses using programs customized to local conditions. SBDCs support small business in marketing and business strategy, finance, technology transfer, government contracting, management, manufacturing, engineering, sales, accounting, exporting, and other topics. They are funded by grants from the SBA and matching funds. There are 63 lead SBDC service centers, at least one in each state (with four in Texas and six in California), the District of Columbia, Puerto Rico, the Virgin Islands, Guam, and American Samoa. These lead SBDC service centers manage more than 900 SBDC outreach locations. As shown in Table 6 , appropriations for SBDCs have increased from $84.179 million in FY2000 to $131.000 million in FY2019. This increase has exceeded the rate of inflation. In addition, as shown in the table, SBDCs received an additional $50 million in temporary funding in FY2010, which was spent over two fiscal years. The SBA reports actual and anticipated expenditures for its ED programs in its annual budget justification document. SBDC expenditures in FY2000-FY2018 and anticipated SBDC expenditures in FY2019 are presented in the table's last column for comparative purposes. The SBA's Microloan lending program is designed to address the perceived disadvantages faced by women, low-income, veteran, and minority entrepreneurs and business owners in gaining access to capital for starting or expanding their business (see P.L. 102-140 , the Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act, 1992). Under the Microloan program, the SBA provides direct loans to qualified nonprofit intermediary Microloan lenders who, in turn, provide "microloans" of up to $50,000 to small business owners, entrepreneurs, and nonprofit child care centers. The SBA's Microloan Technical Assistance program is part of the SBA's Microloan program but receives a separate appropriation. It provides grants to Microloan intermediaries to offer management and technical training assistance to Microloan program borrowers and prospective borrowers. There are currently 147 active Microloan intermediaries, serving 49 states, the District of Columbia, and Puerto Rico. As shown in Table 7 , the Microloan Technical Assistance program's appropriations have varied over the years. Overall, Microloan Technical Assistance Program appropriations have increased from $23.112 million in FY2000 to $31.000 million in FY2019. This increase has been less than the rate of inflation. Microloan Technical Assistance expenditures in FY2000-FY2018 and anticipated Microloan Technical Assistance expenditures in FY2019 are presented in the table's last column for comparative purposes. Women Business Centers (WBCs) provide financial, management, and marketing assistance to small businesses, including start-up businesses, owned and controlled by women. Since its inception, the program has targeted the needs of socially and economically disadvantaged women (see P.L. 100-533 , the Women's Business Ownership Act of 1988). Currently, there are 121 WBCs located throughout most of the United States and the territories. As shown in Table 8 , WBC's recommended appropriations have increased from $8.966 million in FY2000 to $18.500 million in FY2019. This increase has exceeded the rate of inflation. WBC expenditures in FY2000-FY2018 and anticipated WBC expenditures in FY2019 are presented in the table's last column for comparative purposes. The SBA provides financial assistance to SCORE (formerly the Service Corps of Retired Executives) to provide in-person mentoring and online training to small business owners and prospective owners. SCORE's 320 chapters and more than 800 branch offices are located throughout the United States and partner with more than 11,000 volunteer counselors, who are working or retired business owners, executives and corporate leaders, to provide management and training assistance to small businesses "at no charge or at very low cost." As shown in Table 9 , SCORE's recommended appropriations have increased from $3.487 million in FY2000 to $11.700 in FY2019. This increase has exceeded the rate of inflation. SCORE expenditures in FY2000-FY2018 and anticipated SCORE expenditures in FY2019 are presented in the table's last column for comparative purposes. The Program for Investment in Microentrepreneurs (PRIME) provides grants to nonprofit microenterprise development organizations or programs that have "a demonstrated record of delivering microenterprise services to disadvantaged entrepreneurs; an intermediary; a microenterprise development organization or program that is accountable to a local community, working in conjunction with a state or local government or Indian tribe; or an Indian tribe acting on its own, if the Indian tribe can certify that no private organization or program referred to in this paragraph exists within its jurisdiction." As shown in Table 10 , PRIME's recommended appropriations have varied, starting at $14.964 million in FY2001 (the program's first recommended appropriation) and falling to $2 million in FY2006 and FY2007. PRIME has received $5.0 million since FY2015. PRIME expenditures in FY2001-FY2018 and anticipated PRIME expenditures in FY2019 are presented in the table's last column for comparative purposes. The Obama Administration argued that PRIME overlaps and duplicates the SBA's Microloan Technical Assistance program and recommended in its FY2012-FY2017 budget requests that PRIME receive no appropriations. As shown in the table, in FY2013, the Obama Administration eliminated PRIME's appropriation as part of the SBA's sequestration process. The Trump Administration recommended in its FY2018 and FY2019 budget requests that the PRIME program receive no appropriations. The SBA's Office of Veterans Business Development (OVBD) administers several management and training programs to assist veteran-owned businesses, including the Entrepreneurship Bootcamp for Veterans with Disabilities Consortium of Universities, which provides "experiential training in entrepreneurship and small business management to post-9/11 veterans with disabilities" at eight universities; the Veteran Women Igniting the Spirit of Entrepreneurship (V-WISE) program, which is administered through a cooperative agreement with Syracuse University, offers women veterans a 15-day, online course focused on entrepreneurship skills and the "language of business," followed by a 3-day conference (offered twice a year at varying locations) in which participants "are exposed to successful entrepreneurs and CEOs of Fortune 500 companies and leaders in government" and participate in courses on business planning, marketing, accounting and finance, operations and production, human resources, and work-life balance; the Operation Endure and Grow Program, which is administered through a cooperative agreement with Syracuse University, offers an eight-week online training program "focused on the fundamentals of launching and/or growing a small business" and is available to National Guard and reservists and their family members; the Boots to Business program (started in 2012), which is "an elective track within the Department of Defense's revised Training Assistance Program called Transition Goals, Plans, Success (Transition GPS) and has three parts: the Entrepreneurship Track Overview—a 10-minute introductory video shown during the mandatory five-day Transition GPS course which introduces entrepreneurship as a post-service career option; Introduction to Entrepreneurship—a two-day classroom course on entrepreneurship and business fundamentals offered as one of the three Transition GPS elective tracks; and Foundations of Entrepreneurship—an eight-week, instructor-led online course that offers in-depth instruction on the elements of a business plan and tips and techniques for starting a business"; the Boots to Business Reboot program (started in 2014), which assists veterans who have already transitioned to civilian life; and the Veterans Business Outreach Centers (VBOC) program, which provides veterans and their spouses management and technical assistance training at 15 locations, including assistance with the Boots to Business program, the development and maintenance of a five-year business plan, and referrals to other SBA resource partners when appropriate for additional training or mentoring services. Prior to FY2016, Congress recommended appropriations for VBOCs and, in FY2014 and FY2015, for the Boots to Business initiative ($7.0 million in FY2014 and $7.5 million in FY2015). Funding for the OVBD's other veterans assistance programs were provided through the SBA's salaries and expenses account. Starting in FY2016, Congress has recommended appropriations for OVBD's programs as a whole: $12.3 million in FY2016, FY2017, and FY2018, and $12.7 million in FY2019. This increase has not kept pace with inflation. OVBD expenditures in FY2015-FY2018 and anticipated OVBD expenditures in FY2019 are presented in the table's last column for comparative purposes. Recommended appropriations for VBOCs from FY2000-FY2015 are presented in Table 12 for historical comparisons. As the data indicate, recommended appropriations for VBOCs increased from $0.613 million in FY2000 to $3.000 million in FY2015. This increase has exceeded the rate of inflation. OVBD expenditures in FY2000-FY2015 are presented in the table's last column for comparative purposes. The SBA's 7(j) Technical Assistance Program provides "a wide variety of management and technical assistance to eligible individuals or concerns to meet their specific needs, including: (a) counseling and training in the areas of financing, management, accounting, bookkeeping, marketing, and operation of small business concerns; and (b) the identification and development of new business opportunities." Eligible individuals and businesses include "8(a) certified firms, small disadvantaged businesses, businesses operating in areas of high unemployment, or low income or firms owned by low income individuals." As shown in Table 13 , recommended appropriations for the 7(j) Technical Assistance Program have varied since FY2000, with increases in some years and decreases in others. Overall, the SBA's 7(j) Technical Assistance Program's recommended appropriations have decreased from $3.584 million in FY2000 to $2.800 million in FY2019. 7(j) Technical Assistance Program expenditures in FY2000-FY2018 and anticipated 7(j) Technical Assistance Program expenditures in FY2019 are presented in the table's last column for comparative purposes. The SBA's Native American Outreach (NAO) program provides management and technical educational assistance to American Indians, Alaska natives, native Hawaiians, and "the indigenous people of Guam and American Samoa … to promote entity-owned and individual 8(a) certification, government contracting, entrepreneurial education, and capital access." The program's management and technical assistance services are available to members of these groups living in most areas of the nation. As shown in Table 14 , the NAO program's recommended appropriations have varied somewhat since FY2003 (the first year it received recommended appropriations), ranging from $1.0 million to $2.0 million. The program's recommended appropriations have not kept pace with inflation. NAO program expenditures in FY2003-FY2018 and anticipated NAO expenditures in FY2019 are presented in the table's last column for comparative purposes. The National Women's Business Council (NWBC) is a bipartisan federal advisory council created to serve as an independent source of advice and counsel to the President, Congress, and the SBA on economic issues of importance to women business owners. The council's mission "is to promote bold initiatives, policies, and programs designed to support women's business enterprises at all stages of development in the public and private sector marketplaces—from start-up to success to significance." As shown in Table 15 , the recommended appropriation for the NWBC has increased from $0.598 million in FY2000 to $1.500 million in FY2019. This increase has exceeded the rate of inflation. NWBC expenditures in FY2000-FY2018 and NWBC anticipated expenditures in FY2019 are presented in the table's last column for comparative purposes. The HUBZone program helps small businesses located in designated Historically Underutilized Business Zones (HUBZones) to compete for federal contracts. Federal agencies may award contracts directly to HUBZone-certified small businesses through a sole-source contract, limit contact competitions to HUBZone-certified firms through a contract set-aside, or provide HUBZone-certified firms a price evaluation preference in full and open competitions. The HUBZone program was initially funded through the SBA's salary and expenses account. As shown in Table 16 , Congress started recommending an appropriation for the program in FY2004. This recommended appropriation remained relatively stable until FY2015, when it increased to $3.0 million. With this increase, the HUBZone program's recommended appropriations have exceeded inflation. The HUBZone program's expenditures in FY2000-FY2018 and the HUBZone program's anticipated expenditures in FY2019 are presented in the table's last column for comparative purposes. The SBA reports that "regional innovation clusters are on-the-ground collaborations between business, research, education, financing and government institutions that work to develop and grow a particular industry or related set of industries in a particular geographic region." The SBA has supported regional innovative clusters since FY2009, and the initiative has received recommended appropriations from Congress since FY2010. As shown in Table 17 , funding for the Entrepreneurial Development Initiative (Regional Innovation Clusters) has been reduced from a recommended appropriation of $10.0 million in FY2010 to $5.0 million in FY2019. The table's last column indicates that the SBA's expenditures for the initiative have often been less than the amount appropriated. The Trump Administration recommended in its FY2018 and FY2019 budget requests that the Entrepreneurial Development Initiative receive no appropriations. The SBA's Entrepreneurship Education initiative offers high‐growth small businesses in underserved communities "a seven‐month executive leader education series" consisting of "more than 100 hours of specialized training, technical resources, a professional networking system, and other resources to strengthen their business model and promote economic development within urban communities." At the conclusion of the training, "participants produce a three‐year strategic growth action plan with benchmarks and performance targets that help them access the necessary support and resources to move forward for the next stage of business growth." As shown in Table 18 , the Entrepreneurship Education initiative received its first recommended appropriation from Congress in FY2014 ($5.0 million), $7.0 million in FY2015, $10.0 million in FY2016, FY2017, and FY2018, and $3.5 million in FY2019. The SBA describes growth accelerators as "organizations that help entrepreneurs start and scale their businesses." Growth accelerators are typically run by experienced entrepreneurs and help small businesses access seed capital and mentors. The SBA claims that growth accelerators "help accelerate a startup company's path towards success with targeted advice on revenue growth, employee growth, sourcing outside funding and avoiding pitfalls." As shown in Table 19 , the Growth Accelerator initiative received its first recommended appropriation from Congress in FY2014 ($2.5 million), $4.0 million in FY2015, $1.0 million in FY2016, FY2017, and FY2018, and $2 million in FY2019. It provides $50,000 matching grants each year to universities and private sector accelerators "to support the development of accelerators and their support of startups in parts of the country where there are fewer conventional sources of access to capital (i.e., venture capital and other investors)." The Trump Administration recommended in its FY2018 and FY2019 budget requests that the Growth Accelerator Initiative receive no appropriations.

 

 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.

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

Answer: This report examines the Small Business Administration's (SBA's) appropriations (new budget authority, minus rescissions and sequestration) over time, focusing on developments and trends since FY2000. It also provides total available funding (which includes carryover from the prior fiscal year, carryover into the next fiscal year, account transfers, rescissions, and sequestration) and, for entrepreneurial development noncredit programs, actual and anticipated expenditures for comparative purposes. SBA appropriations, as a whole, have varied significantly from year to year since FY2000 and across all three of the agency's major spending categories: disaster assistance, business loan credit subsidies, and "other programs," a category that includes salaries and expenses, business loan administration, the Office of Inspector General, the Office of Advocacy, and entrepreneurial development programs. Overall, the SBA's appropriations have ranged from a high of $2.359 billion in FY2018 to a low of $571.8 million in FY2007. Much of this volatility is due to significant variation in appropriations for disaster assistance, which ranged from a high of $1.7 billion in FY2006 to a low of $0 in FY2009. This variation can be attributed primarily to supplemental appropriations provided to address disaster needs arising from the impact of major hurricanes, such as Hurricanes Katrina and Sandy, and more recently, Hurricanes Harvey, Irma, and Maria. The SBA's appropriations for business loan credit subsidies have also varied since FY2000, ranging from a high of $319.7 million in FY2013 ($337.3 million before sequestration and rescission) to a low of $1.3 million in FY2006 and FY2007. This variation is due to the impact of changing economic conditions on the SBA's guaranteed loan portfolios. During good economic times, revenue from SBA fees and collateral liquidation is typically sufficient to cover the costs of purchasing guaranteed loans that have defaulted. During and immediately following recessions, however, that revenue is typically insufficient to cover the costs of purchasing guaranteed loans that have defaulted. The SBA's appropriations for other programs, as a collective, have also varied since FY2000, ranging from a high of $1.6253 billion in FY2010 to a low of $455.6 million in FY2007. This variation is primarily due to congressional response to changing economic conditions. For example, Congress approved significant, temporary increases in appropriations for the SBA's other programs spending category in FY2009 and FY2010. Overall, since FY2000, appropriations for other programs have increased at a pace that exceeds inflation. This report provides appropriations for all five major components of the other programs spending category, including the SBA's entrepreneurial development programs. The SBA's appropriations for FY1954 through FY1999 are provided in the Appendix.