81–786

107TH CONGRESS REPORT " HOUSE OF REPRESENTATIVES ! 2d Session 107–663

FOREIGN OPERATIONS, EXPORT FINANCING, AND RELATED 

PROGRAMS APPROPRIATIONS BILL, 2003

SEPTEMBER 19, 2002.—Committed to the Committee of the Whole House on the 

State of the Union and ordered to be printed 

Mr. KOLBE, from the Committee on Appropriations, 

submitted the following 

R E P O R T 

together with 

ADDITIONAL VIEWS 

[To accompany H.R. 5410] 

The Committee on Appropriations submits the following report in 

explanation of the accompanying bill making appropriations for 

Foreign Operations, Export Financing, and Related Programs, and 

for sundry independent agencies and corporations for the fiscal 

year ending September 30, 2003, and for other purposes.

INDEX TO BILL AND REPORT 

Page 

Bill Report 

Summary of the Bill ................................................................................... ........ 2

Committee Recommendations ................................................................... ........ 3

Title I—Export and Investment Assistance: 

Export-Import Bank of the United States ........................................ 2 6

Overseas Private Investment Corporation ........................................ 4 7

Trade and Development Agency ........................................................ 6 8

Title II—Bilateral Economic Assistance: 

Child Survival and Health Programs Fund ...................................... 6 9

Development Assistance ..................................................................... 12 19

International Disaster Assistance ..................................................... 13 34

Transition Initiatives .......................................................................... 14 35

Development Credit Authority ........................................................... 14 36

Payment to the Foreign Service Retirement and Disability Fund 15 36

Operating Expenses of the United States Agency for International 

Development .................................................................................... 16 36

Capital Investment Fund ................................................................... 16 40

2

Page 

Bill Report 

Operating Expenses of the Agency for International Development, 

Office of the Inspector General ...................................................... 17 41

Economic Support Fund ..................................................................... 18 41

International Fund for Ireland .......................................................... 21 49

Assistance for Eastern Europe and the Baltic States ...................... 21 50

Assistance for the Independent States of the Former Soviet Union 24 52 

Independent Agencies: 

Inter-American Foundation ................................................................ 28 57

African Development Foundation ...................................................... 28 57

Peace Corps ......................................................................................... 29 58

Department of State: 

International Narcotics Control and Law Enforcement .................. 30 58

Andean Counterdrug Initiative .......................................................... 30 61

Migration and Refugee Assistance .................................................... 33 65

Emergency Refugee and Migration Assistance Fund ...................... 34 68

Nonproliferation, Anti-terrorism, Demining and Related Programs ................................................................................................ 34 68

Department of the Treasury: 

International affairs technical assistance ......................................... 36 69

Title III—Military Assistance: 

International Military Education and Training ............................... 36 70

Foreign Military Financing Program ................................................ 37 71

Peacekeeping Operations .................................................................... 40 74

Title IV—Multilateral Economic Assistance: 

Global Environment Facility .............................................................. 41 74

International Development Association (IDA) .................................. 41 74

Multilateral Investment Guarantee Agency ..................................... 41 75

Inter-American Investment Corporation ........................................... 42 76

Multilateral Investment Fund ........................................................... 42 76

Asian Development Fund (ADF) ........................................................ 42 76

African Development Bank ................................................................ 42 77

African Development Fund (AFDF) ................................................... 43 77

European Bank for Reconstruction and Development (EBRD) ....... 43 77

International Fund for Agricultural Development (IFAD) .............. 44 77

Department of State: 

International Organizations and Programs ...................................... 44 78

Title V—General Provisions ...................................................................... 44 78

House of Representatives Report Requirements ..................................... ........ 83

SUMMARY OF THE BILL

The Committee has recommended foreign assistance and export 

financing funding at a level that is $78,678,000 above the Administration’s fiscal year 2003 request of $16,470,696,000 in discretionary budget authority. The resulting total of $16,549,374,000 in 

discretionary appropriations is needed to meet the essential requirements of the United States and its President in conducting 

foreign policy and meeting urgent humanitarian needs abroad. The 

primary reason the bill exceeds the President’s request is the need 

for additional funds to combat HIV/AIDS. 

ACCRUAL FUNDING OF RETIREMENT COSTS AND POST-RETIREMENT

HEALTH BENEFITS

The President’s Budget included a legislative proposal under the 

jurisdiction of the House Committee on Government Reform to 

charge to individual agencies, starting in fiscal year 2003, the fully 

accrued costs related to retirement benefits of Civil Service Retirement System employees and retiree health benefits for all civilian 

3

employees. The Budget also requested an additional dollar amount 

in each affected discretionary account to cover these accrued costs. 

Without passing judgment on the merits of this legislative proposal, the Committee has reduced the dollar amounts of the President’s request shown in the ‘‘Comparative Statement of New Budget Authority’’ and other tables in this report to exclude the accrual 

funding proposal. The disposition by Congress of the legislative 

proposal is unclear at this time. Should the proposal be passed by 

Congress and enacted, the Committee will make appropriate adjustments to the President’s request to include accrual amounts. 

The Committee further notes that administration proposals requiring legislative action by the authorizing committees of Congress are customarily submitted in the budget as separate schedules apart from the regular appropriations requests. Should such 

a proposal be enacted, a budget amendment formally modifying the 

President’s appropriation request for discretionary funding is then 

transmitted to the Congress. 

The Committee is concerned that this practice, which has always 

worked effectively for both Congress and past administrations, was 

not followed for the accrual funding proposal. In this case, the Office of Management and Budget (OMB) decided to include accrual 

amounts in the original discretionary appropriations language request. These amounts are based on legislation that has yet to be 

considered and approved by the appropriate committees of Congress. This led to numerous misunderstandings both inside and 

outside of Congress of what was the ‘‘true’’ President’s budget request. The Committee believes that, in the future, OMB should follow long-established procedures with respect to discretionary 

spending proposals that require legislative action. 

The following chart indicates, by relevant account within this appropriations act, the budget request with and without the accrual 

proposal of the President.

Account 03 request Accrual portion 03 w/o accrual 

Export-Import Bank administrative expenses ................................................... 70,300,000 1,928,000 68,372,000 

OPIC administrative expenses .......................................................................... 40,676,000 791,000 39,885,000 

Trade and Development Agency ....................................................................... 44,696,000 184,000 44,512,000 

USAID Operating Expenses ............................................................................... 586,087,000 13,887,000 572,200,000 

USAID Inspector General ................................................................................... 34,046,000 1,346,000 32,700,000 

Inter-American Foundation ............................................................................... 14,185,000 185,000 14,000,000 

Peace Corps ...................................................................................................... 320,228,000 3,228,000 317,000,000 

International Narcotics ..................................................................................... 197,713,000 713,000 197,000,000 

Migration and Refugee Assistance ................................................................... 1 705,565,000 565,000 2 705,000,000 

1W/admin. ceiling of 16,565,000. 

2W/admin. ceiling of 16,000,000. 

COMMITTEE RECOMMENDATIONS

For export and investment assistance programs the Committee 

has recommended a gross total of $723,097,000 which is partially 

offset by collections and a negative subsidy totaling $319,000,000. 

The subsidy appropriation for the Export-Import Bank is 

$541,400,000 and the Trade and Development Agency is funded at 

$49,512,000. Consistent with the President’s budget request, the 

Committee has provided $24,000,000 in subsidy appropriations for 

the Overseas Private Investment Corporation. 

The Committee has recommended $1,345,997,000 of the 

$1,437,097,000 requested for the international financial instituVerDate Sep 04 2002 03:50 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00003 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.000 HR663
4

tions. The overall level is $170,801,000 above the fiscal year 2002 

enacted level and $91,500,000 below the request. 

For development and humanitarian assistance, the Committee 

has recommended a total of $4,165,191,000 of which $1,710,000,000 

is for child survival and health programs. Another $1,398,000,000 

is for longer-term development assistance. The Committee has also 

included $315,500,000 for disasters worldwide and $40,000,000 for 

transition initiatives. 

The Committee has continued its highly effective Child Survival 

and Health Programs Fund. The account is designed to ensure that 

there will not be reductions in these vital programs as the overall 

bilateral assistance program is constrained. The emphasis is on 

programs that directly affect children and on accelerating efforts to 

eradicate diseases that threaten younger children and caregivers 

alike. As in fiscal year 2002, the account includes population assistance, while basic education for children is funded through the Development Assistance account. It does provide for a grant to 

UNICEF at a level of $120,000,000. 

The Committee has included a total of $755,000,000 in assistance 

to the Independent States of the Former Soviet Union, and 

$520,000,000 for Eastern Europe and the Baltic States. The Committee has recommended a total of $820,000,000 for refugee programs. 

For economic assistance under the Economic Support Fund, the 

Committee has recommended a total of $2,445,000,000. 

The Committee has recommended $347,400,000 for a Nonproliferation, Anti-terrorism and Demining account which includes 

funding for the Nonproliferation and Disarmament Fund, anti-terrorism assistance, demining activities, United States participation 

in the Korean Energy Development Organization (KEDO), and the 

U.S. voluntary contribution to the International Atomic Energy 

Agency (IAEA). 

For the Foreign Military Financing program, the Committee has 

recommended a grant program of $4,080,200,000, including an increase of $60,000,000 in assistance for Israel. 

AFGHANISTAN

HUMANITARIAN AND RECONSTRUCTION ASSISTANCE

In response to the ongoing need for assistance for Afghanistan, 

the Committee recommends a new general provision, section 523, 

providing that not less than $295,500,000 shall be made available 

for humanitarian and reconstruction assistance for Afghanistan, including assistance to improve the status of women in Afghanistan, 

assistance to victims of war, and assistance to repair roads and 

bridges. 

Under the heading, ‘‘Economic Support Fund’’, the Committee 

recommends language providing that not less than $45,000,000 

should be made available for assistance for Afghanistan, which 

shall be used for reconstruction and other infrastructure assistance, including roads and bridges. 

Other humanitarian and economic assistance for Afghanistan is 

provided under the headings ‘‘Child Survival and Health Programs 

Fund’’, ‘‘International Disaster Assistance’’, ‘‘International Narcotics and Law Enforcement’’, ‘‘Migration and Refugee Assistance’’, 

5

‘‘Nonproliferation, Anti-terrorism, Demining and Related Programs’’, and ‘‘International Organizations and Programs’’. 

TRADE CAPACITY BUILDING

The Committee this year places major emphasis on economic 

growth, especially the role of trade capacity building and education. 

Language is included in titles I, II, and V directing the Trade and 

Development Agency, the U.S. Agency for International Development, and the Department of State to obligate not less than 

$452,000,000 for myriad activities designed to promote trade within and between regions. The Committee’s emphasis on trade capacity assistance is intended to complement the African Growth and 

Opportunity and Andean Trade Acts. 

The Committee is aware that substantial progress toward rule of 

law, effective regulatory structures, transparent governance, and a 

more educated work force are necessary companions to effective 

trade capacity assistance. The Committee’s objective is to benefit 

the majority of citizens in the beneficiary countries, not the small 

elite who have typically received the bulk of benefits from oil and 

gas exports by developing nations.

MILLENNIUM CHALLENGE ACCOUNT

The Committee notes that in March 2002 the President announced a major change in the form and substance of as much as 

$10,000,000,000 in additional United States foreign assistance over 

a three year period beginning in 2004. As the Millennium Challenge Account, this new approach to foreign assistance would encourage economic development by creating a positive competition 

among potential recipients, with this competition rewarding those 

countries that adopt policies that help their citizens. 

On June 27, 2002, the Committee conducted a hearing on the 

Millennium Challenge Account concept, during which Members and 

witnesses expressed a broad range of views and concerns regarding 

the proposed change. A number of members expressed interest in 

funding a pilot project with a relatively small appropriation in this 

Act, so that Congress and the Executive branch would better understand the implications of this new approach to economic development assistance. To date, the Administration has made no legislative proposal or budget request for a pilot program. It is the Committee’s understanding that the inter-agency process has reached 

no common approach regarding management or implementation of 

the proposal. For these reasons, the Committee does not recommend funding for a pilot project to test and perfect the Millennium Challenge Account concept. 

The Committee expects to be consulted as development of the 

Millennium Challenge Account proceeds within the Executive 

branch. While the Committee welcomes new approaches to foreign 

aid, it remains determined to protect Congress’s constitutional 

power of the purse. 

6

TITLE I—EXPORT AND INVESTMENT ASSISTANCE 

EXPORT-IMPORT BANK OF THE UNITED STATES

SUBSIDY APPROPRIATION

Fiscal year 2002 level ......................................................................... $727,323,000 

Fiscal year 2003 request .................................................................... 541,400,000 

Committee recommendation .............................................................. 541,400,000

ADMINISTRATIVE EXPENSES

Fiscal year 2002 level ......................................................................... $63,000,000 

Fiscal year 2003 request .................................................................... 68,372,000 

Committee recommendation .............................................................. 68,300,000

The Committee is recommending a subsidy appropriation for the 

Export-Import Bank of $541,400,000 and an appropriation of 

$68,300,000 for administrative expenses. Taken together, the recommended appropriation for the Export-Import Bank is 

$180,623,000 less than the fiscal year 2002 level and $72,000 below 

the request. 

Although the $541,400,000 requested by the President for the 

subsidy appropriation is a $185,923,000 reduction from the fiscal 

year 2002 level, there should be no cut in Export-Import Bank activity levels due to changes in the methodology for estimating risk 

factors as estimated by the Office of Management and Budget and 

required under the Federal Credit Reform Act. The Committee expects that this level of subsidy will support a projected level of Export-Import Bank authorizations of $11,500,000,000 in 2003, approximately $500,000,000 higher than the estimated fiscal year 

2002 levels.

The Committee provided no additional funds for a tied-aid ‘‘war 

chest’’. The estimated $260,500,000 remaining ‘‘war chest’’ balance 

for tied-aid purposes may be used to support loans. 

The Committee has continued prior year language limiting the 

export of nuclear technology or fuel to certain countries. 

The Committee urges the Export-Import Bank to take into account global and domestic market conditions before extending financing to foreign buyers, especially with respect to the domestic 

steel market and the President’s goal of reducing the global excess 

steel making capacity. The Committee expects the Export-Import 

Bank to report back to the Committee any steel related proposals 

posted on the agenda of the Export-Import Bank’s Board. 

The Committee recommends a one-year extension of the ExportImport Bank’s dual use authority, which expired on June 14, 2002. 

Dual use authority allows the Bank to finance transactions dealing 

with items that can be used for both civilian and military purposes, 

but must be non-lethal in nature, and shall be used predominantly 

by civilian authorities. 

REPORT ON AMERICAN CONTENT

The Committee is interested in the implementation of the requirements of the charter of the Export-Import Bank on United 

States content. Therefore, the Committee directs that the ExportImport Bank prepare and submit a report by February 28, 2003 on 

the methodology used to determine United States content of goods 

7

which are the product of Export-Import Bank backed loans or guarantees. 

BROOKE AMENDMENT PROCEDURES

The Committee is aware of an inter-agency agreement among the 

Departments of State and Defense, the Export-Import Bank, and 

USAID that establishes reporting procedures regarding compliance 

with section 512 of the bill, the so-called Brooke amendment, and 

section 620(q) of the Foreign Assistance Act. The procedures provide a mechanism to share information among those agencies regarding countries that are either in arrears on loan repayments 

owed the United States or which may soon become so. Since the 

provision of foreign assistance to countries in arrears is restricted 

by those sections, information required by these procedures is of 

great importance to the administration of foreign assistance funds. 

The Committee is therefore concerned about reports that the Export-Import Bank has, in at least two instances this year, failed to 

provide information on arrearages in a timely fashion in accordance 

with its obligations under the inter-agency agreement. The Committee directs the Export-Import Bank to follow the inter-agency 

agreement and not allow a similar lapse to occur again.

OVERSEAS PRIVATE INVESTMENT CORPORATION

NONCREDIT ACCOUNT

Fiscal year 2002 level ......................................................................... $38,608,000 

Fiscal year 2003 request .................................................................... 39,885,000 

Committee recommendation .............................................................. 39,885,000

PROGRAM ACCOUNT

Fiscal year 2002 level ......................................................................... ............................

Fiscal year 2003 request .................................................................... $24,000,000 

Committee recommendation .............................................................. 24,000,000

The Committee is recommending a $24,000,000 subsidy appropriation for the Overseas Private Investment Corporation’s (OPIC) 

direct and guaranteed loan credit programs and $39,885,000 for administrative expenses, the same levels as the request. 

Because of significant carryover in the credit programs account 

in fiscal year 2002, there was no request by the President for an 

appropriation. Because these funds expire at the end of fiscal year 

2002, an appropriation is requested and needed in fiscal year 2003.

The Committee continues prior year language required by the 

Federal Credit Reform Act and addressing representation expenses 

and availability of funds. 

As in last year’s report, the Committee directs OPIC to continue 

to provide on a semi-annual basis written reports including the following information for each investment fund: the identity, selection 

process, and professional background of current and past managers; the fees and compensation currently provided to senior management; the amount of OPIC guarantees and actual investments 

made at the end of the previous month; and any additional observations that OPIC may want to include. 

The Committee commends the managers of OPIC for exploring 

new ways of meeting OPIC’s development mandate, but the Committee is concerned about attempts by OPIC to offer financing 

8

guarantees in developing countries without coordination with 

USAID. To ensure that foreign assistance is not provided to countries on different terms by different United States Government 

agencies, the Committee expects OPIC to coordinate with USAID, 

OMB and other agencies of the United States Government with 

which OPIC may overlap in providing financing. The Committee 

does not believe that OPIC should compete with USAID in countries that have USAID missions and programs. 

FUNDS APPROPRIATED TO THE PRESIDENT

TRADE AND DEVELOPMENT AGENCY

Fiscal year 2002 level ......................................................................... $50,024,000 

Fiscal year 2003 request .................................................................... 44,512,000 

Committee recommendation .............................................................. 49,512,000

The Committee is recommending $49,512,000 for the Trade and 

Development Agency (TDA), a decrease of $512,000 below the 2002 

level and $5,000,000 above the request. 

The Committee understands that TDA has achieved an extraordinary high level of programming activity in fiscal year 2002, and 

it has demonstrated an ability to respond quickly to changing 

United States foreign policy needs after September 2001 in frontline states and regions in transition from conflict. The Committee 

commends TDA’s new trade capacity building efforts and initiatives 

to support United States international economic policy, including 

those related to the Africa Growth and Opportunity Act (AGOA) 

initiative and the Partnership for Prosperity. 

The Committee believes that the President’s request for TDA, a 

$5,512,000 reduction from fiscal year 2002, is not reflective of current demand and anticipated requirements. Therefore, the Committee has provided $49,512,000 for TDA, of which $5,000,000 

above the request is provided for trade capacity building activities. 

In addition, the Committee urges the Department of State and 

USAID to transfer up to $24,000,000 from title II accounts to TDA. 

In collaboration with the U.S. National Institute of Standards 

and Technology, TDA is encouraged to support United States participation in the development of national technical standards compatible with American goods and services in key transition country 

markets. 

TITLE II—BILATERAL ECONOMIC ASSISTANCE 

FUNDS APPROPRIATED TO THE PRESIDENT

AGENCY FOR INTERNATIONAL DEVELOPMENT

STRUCTURE OF DEVELOPMENT ASSISTANCE ACCOUNTS

The Committee provides two accounts for longer-term development assistance programs managed by the U.S. Agency for International Development (USAID). As in fiscal year 2002, the bill includes an account for child survival and health programs. It also 

includes a separate development assistance account for other program sectors, including economic growth and trade capacity building activities, education, environment, and governance. The PresiVerDate Sep 04 2002 01:55 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00008 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.001 HR663
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dent recommended a single account for longer-term development 

assistance programs. 

Two existing regional accounts jointly managed by the Department of State and the Agency for International Development are 

included elsewhere in title II under ‘‘Other Bilateral Assistance’’. The Committee utilizes the regional accounts to fund most economic and political cooperation with Russia and the independent 

states of the former Soviet Union as well as the former captive nations of the Soviet Empire in Central Europe. 

Finally, authority is provided for the United States to make contributions from the Child Survival and Health Programs Fund to 

three international health funds: the Global Fund to Fight AIDS, 

Malaria and Tuberculosis, The Vaccine Fund [associated with the 

Global Alliance for Vaccines and Immunizations]; and the International AIDS Vaccine Initiative. 

CHILD SURVIVAL AND HEALTH PROGRAMS FUND

(INCLUDING TRANSFER OF FUNDS)

Fiscal year 2002 level ......................................................................... $1,433,500,000 

Fiscal year 2003 request .................................................................... ............................

Committee recommendation .............................................................. 1,710,000,000

(by transfer) ................................................................................. (6,000,000) 

The Committee recommends $1,710,000,000 for the ‘‘Child Survival and Health Programs Fund’’, an amount that is $226,000,000 

above the request under the fiscal year 2002 account structure and 

$276,500,000,000 above the amount enacted for 2002 under the existing account structure. The recommendation includes authority 

for United States contributions to three international health funds. 

OVERVIEW OF HIV/AIDS ASSISTANCE

The United States has been, and is continuing to be, the leader 

in the global fight against HIV/AIDS. As it has for many years, the 

Committee continues to support the fight against HIV/AIDS 

through United States bilateral assistance programs managed by 

the Agency for International Development. In other appropriation 

Acts, additional support for the fight against HIV/AIDS is provided 

through the Centers for Disease Control and the National Institutes of Health. 

In order to protect the integrity of the Child Survival and Health 

Programs Fund and the long-standing role of the Secretary of State 

as primary agent of the President of the United States in foreign 

affairs, the Committee includes language from the conference 

agreement on H.R. 4775 that limits transfer of these funds to another department or agency of the United States Government. 

Under the overall policy guidance of the Secretary of State, USAID 

works with both the CDC and the NIH in its overseas operations. 

All of these bilateral programs are fully operational today; together 

they are the worldwide leaders in the field. 

The Committee has made available a total of $786,500,000 in 

this bill for HIV/AIDS, of which $746,500,000 is funded through the 

Child Survival and Health Programs Account. Another $40,000,000 

is provided through other AID-managed accounts, such as the Economic Support Fund, International Disaster Assistance, and regional accounts for Eastern Europe and the former Soviet Union. 

10

By comparison, two years ago the Committee recommended a total 

of $210,000,000 and the final conference agreement provided 

$315,000,000 for the same purpose. Last year, the comparable 

amounts were $474,000,000 and $475,000,000. Overall, the fiscal 

2003 allowance of $786,500,000 for HIV/AIDS is $311,000,000 

above the fiscal year 2002 enacted level, an increase of 150 percent 

over two years, and $46,500,000 above the President’s request for 

programs funded in this act. 

GLOBAL FUND TO FIGHT AIDS, TUBERCULOSIS AND MALARIA

In order to encourage other donors to match and exceed the 

United States contribution, the Committee recommends that 

$250,000,000 be provided from USAID’s Child Survival and Health 

Programs Fund to the Global Fund to Fight AIDS, Tuberculosis 

and Malaria (Global Fund). To date, the President has requested 

$100,000,000 for this purpose in this bill. In addition, $100,000,000 

has been requested for the Global Fund in the Labor, Health, and 

Human Services Appropriations bill. 

Should the Committee’s recommendation in this bill for the Global Fund and the President’s request for the Global Fund from the 

Department of Health and Human Services both be enacted into 

law, the United States contribution over the 2002–2003 period would total at least $650,000,000, much more than has been made 

available to the Global Fund, thus far, by all other donors. The 

Committee urges the President and the Secretary of State to take 

advantage of the extensive international health field experience of 

the U.S. Agency for International Development by designating, 

when a vacancy occurs, the Assistant Administrator for Global 

Health as the next United States representative on the Governing 

Board of the Global Fund. 

The Committee notes that the Global Fund was established to 

fight the global resurgence of tuberculosis and malaria as well as 

HIV/AIDS. In calculating its recommended allocations by USAID of 

the Child Survival and Health Programs Fund, the Committee assumes that the U.S. contribution will be used for awards that focus 

on HIV/AIDS, although some may be used for tuberculosis and malaria. The actual distribution of funds by the Global Fund will depend on the merits of the proposals it receives. 

In order to support the international character of the Fund, as 

jointly announced by the UN Secretary General and the U.S. President, the Committee again recommends a burden-sharing provision, similar to one recently enacted into law in the conference 

agreement on H.R. 4775, limiting the United States cumulative 

contribution to an amount that does not exceed the total resources 

made available by other donors for immediate use by the Global 

Fund. 

ESSENTIAL ROLE OF FREE MARKET ECONOMIC GROWTH IN

DEVELOPMENT

The Committee has reluctantly resisted appeals to accelerate 

funding increases for this account. The Child Survival and Health 

Programs Fund is only one part of the United States effort to help 

others work toward the standards of living most Americans have 

achieved already. The Committee recognizes that the long-term 

benefits of the Fund are limited unless there are future jobs and 

11

income for the children we help when they grow up to be adults. 

Continuing USAID support for free market approaches to economic 

growth and trade remains essential to complete the work of child 

survival. In each poor country helped by American child survival 

activities, a balanced assistance program also requires cooperation 

to provide reasonably priced and reliable food, clean water, efficient 

power, and global communications as well as access to credit. 

ALLOCATION OF CHILD SURVIVAL AND HEALTH PROGRAMS FUND

Unless modifications are subsequently notified and agreed to by 

the Committees on Appropriations, fiscal year 2003 appropriations 

for the Child Survival and Health Programs Fund are deemed to 

be allocated as follows:

Category Allocation 

Child Survival and Maternal Health ................................................... $340,000,000 

Vulnerable children ............................................................................... 30,000,000 

HIV/AIDS ............................................................................................... 1 746,000,000 

Other Infectious Diseases ..................................................................... 105,000,000 

Reproductive Health/Voluntary Family Planning ............................... 368,500,000 

Grant to UNICEF .................................................................................. 120,000,000 

Total in this account ................................................................... 1,710,000,000 

Other CSH activities in ESF ................................................................ 90,000,000 

CSH activities in regional accounts ..................................................... 75,000,000 

Total in all bilateral accounts .................................................... 1,875,000,000

1The two categories indicated include amounts for TB prevention among persons with HIV/

AIDS that also may be included in the other infectious diseases/TB category.

A definition of program categories and their components can be 

found on pages 9 through 11 of House Report 107–142 and under 

the heading ‘‘Family Planning/Reproductive Health’’ on page 12 of 

Senate Report 107–58. The United States Agency for International 

Development has also issued guidance on this matter. 

The Committee is again including bill language that prohibits 

the use of certain funds in this account for nonproject assistance, 

or cash grants, to governments. The provision of cash grants as 

general budget support for governments is no longer an appropriate 

development tool, given current funding constraints. To the extent 

that cash grants are necessary for countries in transition or for 

specific foreign policy goals, funds are available through the ‘‘Economic Support Fund’’. 

CHILD SURVIVAL AND MATERNAL HEALTH: FORMER SOVIET UNION

The Committee continues to be concerned about the low priority 

assigned to declining maternal and environmental health conditions and the increasing incidence of TB/HIV/AIDS in Russia, 

Ukraine, and the Central Asian republics. The positive results 

achieved with the small amounts already spent for such programs 

in recent years have been dramatic. The Committee has included 

bill language regarding a minimum level of $45,000,000 to be allocated for child survival and health programs within the separate 

account, ‘‘Assistance to the Independent States of the Former Soviet Union.’’

CHILD SURVIVAL AND MATERNAL HEALTH: MICRONUTRIENTS

The Committee recommends that USAID make every effort to 

provide $30,000,000 from all accounts for its overall micronutrient 

12

program. Vitamin A is essential to the functioning of the immune 

system and increases children’s resistance to disease. It affects 

more than 100 million children and is responsible for as many as 

one out of every four child deaths in countries where the problem 

exists. Vitamin A is a low-cost solution to many easily preventable 

diseases, and at least $20,000,000 of the overall micronutrient program should be for activities related to Vitamin A deficiency. 

The Committee is aware that iodine deficiency disorder (IDD) is 

the leading preventable cause of mental retardation in children. 

The problems associated with iodine deficiency are particularly of 

concern in the former Soviet republics and southeast Europe and 

regions of Africa and South Asia. Private funds, raised by Kiwanis 

International and implemented by UNICEF, are preventing the 

mental retardation of millions of children. The Committee recommends that in order to help meet the IDD partnership goals, 

USAID provide a total of at least $2,500,000 from the Child Survival and Health Programs Fund and $1,000,000 from Europe and 

Eurasia regional accounts for the Kiwanis/UNICEF IDD partnership program. 

CHILD SURVIVAL AND MATERNAL HEALTH: POLIO ERADICATION

The Committee recommendation includes within the child survival and maternal health allocation not less than $25,000,000 for 

the final phases of the program initiated by the Committee in fiscal 

year 1996 to eradicate polio by 2006.

CHILD SURVIVAL AND MATERNAL HEALTH: VACCINES AND

IMMUNIZATION

The Committee is aware that as many as three million children 

die each year because they do not receive life-saving immunizations. Over many years, the Committee has funded procurement of 

polio and other childhood vaccines directly through AID and indirectly through the grant to UNICEF. In addition, The Vaccine 

Fund provides resources to support the international, public and 

private partnerships. More than $900,000,000 for 60 countries has 

been committed for immunization programs—potentially saving as 

many as two million lives a year. The Committee strongly supports 

continued funding for this program, and recommends that 

$60,000,000 be provided to The Vaccine Fund in fiscal year 2003. 

VULNERABLE CHILDREN

The Committee directs AID to allocate $30,000,000 for displaced 

children and orphans and blind children in fiscal year 2003. 

Older children permanently placed in orphanages are often dismissed from state care and thrown out on the streets to survive 

without skills. Most teenage orphans find that their only chance for 

survival is to participate in criminal acts, including prostitution 

and selling drugs. United States assistance in establishing a limited number of vocational-technical centers will teach these orphans the necessary skills to become productive members of society. The Committee is aware of the effective programs to address 

this situation by Kidsave International and the Fabretto Children’s 

Foundation and requests that USAID support them. 

13

The Committee is particularly concerned about the destitution 

and abuse of such older children in Central America, especially 

Nicaragua, and requests that the Administrator of USAID submit 

a brief written report to the Committee by March 1, 2003 on the 

status of vulnerable older children in Central America and the 

level of assistance provided to organizations helping them. 

The Committee is painfully aware that trafficking in children 

and youth especially affects vulnerable children. Although the 

Committee continues to encounter difficulty in obtaining timely information about the identity and funding of anti-trafficking projects 

(apart from those funded through regional accounts for Europe and 

Eurasia) that were authorized by P.L. 106–386, it urges USAID officials responsible for vulnerable children activities to work closely 

with the appropriate anti-trafficking office in the Department of 

State to alert that office and the Committee regarding any credible 

reports that any NGO advocates so-called consenting prostitution, 

especially among children and youth. The Committee was informed 

of a credible allegation that a European NGO supported court action in South Asia to halt efforts to rescue children in danger of 

recruitment as prostitutes. 

According to the World Health Organization there are 1.5 million 

blind children around the world. Another 7 million children suffer 

from low levels of vision. The Committee recognizes the work being 

done by Helen Keller Worldwide and other organizations to assist 

blind children and children with low levels of vision. These children 

can be helped through simple and inexpensive methods of prevention and low cost care. The committee recommends that the AID 

program for children’s blindness be funded at a level of $1,500,000. 

The Committee notes that handicapped and other disadvantaged 

children in USAID countries have few opportunities for physical exercise that promotes development. A significant portion of the 

$5,000,000 increase above the current level for vulnerable children 

should be allocated for established organizations such as Special 

Olympics and Olympic Aid that have a record of accomplishments 

in this sector. 

HIV/AIDS: OVERVIEW

As with all USAID programs, the fight against HIV/AIDS requires ‘‘good development partners’’. The rapid increase in HIV infection in many poor countries can be attributed, in part, to government leaders’ refusal to publicly acknowledge the crisis and to their 

slowness in dedicating resources to fight it. Government leaders 

have a responsibility to their citizens to foster awareness and education, the causes of transmission, and the scientifically proven 

methods to combat it. All USAID country strategies for HIV programs must include components to encourage behavioral, cultural 

and social change. 

The United States has long led the world’s response to HIV/AIDS 

and will expand its financial commitment as effective models of assistance and effective partners are identified. For fiscal year 2003, 

the Committee directs USAID to increase funding for all of its 

international AIDS and related TB activities from not less than 

$475,000,000 in 2001 to at least $746,000,000 in 2003. 

The Committee urges USAID and the Department of State to 

focus on three priorities for the increases provided in its fiscal 2003 

14

appropriation for HIV/AIDS: mother-to-child transmission in conjunction with maternal health programs in affected communities; 

more extensive involvement in treatment programs for people living with HIV/AIDS, and higher funding levels for UNAIDS. Although there is broad agreement about the first two priorities, the 

last may not be widely understood. Increasing funding for UNAIDS 

above its current level would enable UNAIDS to support 

$15,000,000 for effective country coordinating mechanisms, without 

which the Global Fund to Fight AIDS, Tuberculosis, and Malaria 

cannot be successful. As in past years, AID should utilize to the 

maximum extent community-based, nongovernmental organizations 

that have ‘‘on the ground’’ prevention and care programs. 

The grave and urgent nature of the epidemic requires that funds 

be disbursed as rapidly as possible. With due regard for financial 

accountability and program effectiveness, USAID, in consultation 

with the Department of State and the Centers for Disease Control, 

is strongly encouraged to identify and employ implementation 

strategies for accelerating the provision of resources to those working on the front lines of the epidemic. Coordination with other bilateral and multilateral donors is encouraged, but should not delay 

United States efforts to deliver resources to the field. 

HIV/AIDS: MOTHER-TO-CHILD TRANSMISSION

Up to $100,000,000, as requested by the President on September 

3, 2002, should be made available for International Mother and 

Child HIV Prevention activities, including awards for this objective 

by the Global Fund from United States contributions for this purpose. 

The Committee commends USAID for its rapidly expanding support of programs to prevent mother-to-child transmission (MTCT) 

in sub-Saharan Africa, the Caribbean, and other regions currently 

experiencing or anticipating a high prevalence of HIV infections 

among pregnant mothers. In addition, USAID should ensure that 

established MTCT prevention sites expand to provide the most extensive care and treatment program possible for all mothers and 

infants, along with related social services designed to keep families 

and communities intact. 

HIV/AIDS: VACCINES AND MICROBICIDES

The Committee acknowledges the critical need to find new technologies to prevent HIV infections and continues to support 

$15,000,000 for research on and testing of AIDS vaccines and 

microbicides. In addition to research and development, the Committee supports efforts to identify and resolve barriers to accessing 

those technologies. USAID is urged to participate with organizations such as the International AIDS Vaccine Initiative and the Alliance for Microbicide Development in efforts to insure that 

microbicides and vaccines are widely available as soon as scientifically possible. The Committee requests the Department of State, 

in consultation with USAID and the National Institutes of Health, 

to provide it with a brief written report on the status of federal 

support for microbicide and vaccine research, including access 

issues, not later than February 28, 2003. 

15

HIV/AIDS: CARE AND TREATMENT

USAID is urged to accelerate its efforts to identify strategies for 

implementing broad-based programs that include treatment. The 

Committee also recognizes the importance of involving people living 

with HIV/AIDS in the planning and implementation of programs, 

and urges USAID to increase its efforts in this area through collaborations with established peer organizations. The Committee requests USAID to provide the Committee with a written report on 

its current and planned activities supporting treatment and care of 

persons living with HIV/AIDS, including the provision of 

antiretroviral therapy to the extent possible, not later than March 

15, 2003. The report should discuss efforts to involve persons living 

with HIV/AIDS in its programs for care and treatment. 

HIV/AIDS: BURMA AND THE RESURGENCE IN SOUTHEAST ASIA

The Committee is aware that HIV/AIDS is spreading rapidly in 

Asia, and that Burma is playing a pivotal role in its spread. In 

Thailand, a country thought to have the epidemic under control, recent evidence shows a resurgence of the disease. Burma itself faces 

devastating epidemics of heroin addiction and HIV/AIDS infection, 

with the HIV virus spreading rapidly from intravenous drug users 

to the wider population. Finally, the Burmese regime officially acknowledged that HIV/AIDS is a serious problem in Burma; however, it has made minimal official effort to contain the disease. The 

Committee appreciates USAID, State Department, and CDC reporting and analysis of the HIV/AIDS crisis in Burma, and has included a general provision directing USAID to continue to expand 

its support of Burmese struggling to limit HIV/AIDS. 

HIV/AIDS: CHILDREN AND FAMILIES AFFECTED BY HIV/AIDS

AIDS is devastating the family structure in many countries, leaving millions of children orphaned and more vulnerable to HIV infection, poor health, little schooling, and even sexual exploitation. 

Approximately 600,000 newborns in the developing world contracted the virus just last year. Experts predict that the number 

of AIDS orphans will reach 40,000,000 by the end of the current 

decade. 

The Committee strongly supports efforts to assist these vulnerable children, and urges that at least $20,000,000 be provided to 

assist AIDS orphans and HIV positive children. The Committee encourages USAID to support effective programs, including those administered by UNICEF and non-governmental organizations such 

as HOPE Worldwide and Lott Carey International, that are operating within nations affected by the epidemic. The Committee requests that the USAID bureaus for Africa and Latin America and 

the Caribbean provide periodic reports on USAID support for the 

activities of Lott Carey International and HOPE Worldwide. 

A primary factor in the impoverishment of children affected by 

HIV/AIDS is the denial of inheritance rights of widowed women in 

many African countries. Often mothers with children are no longer 

allowed to remain in the family home or cultivate matrimonial land 

after a spouse living with HIV/AIDS dies. Denial of inheritance 

rights also aggravates the HIV/AIDS epidemic by forcing young 

widows with few resources into relations with men who carry HIV/

16

AIDS, effectively increasing the number of orphans. The Committee 

urges USAID to award up to $1,000,000 in grants to private nongovernmental organizations with competence to address this issue 

in Africa. 

HIV/AIDS: MEDIA EDUCATION

The fight against HIV/AIDS takes place on many fronts. More 

education about causes, effect and treatment of HIV/AIDS is needed in many regions, especially in Sub-Sahara Africa and the Caribbean. A promising approach to prevention is the use of unbiased, 

accurate, and culturally sensitive media to spread information on 

HIV/AIDS. The Committee supports additional funding for independent media training and effective public service announcements 

to meet these needs. 

HIV/AIDS SUMMARY

The Committee anticipates that at least $40,000,000 for HIV/

AIDS will be funded from the Economic Support Fund 

($17,000,000), regional accounts ($13,000,000), and accounts administered by the Bureau for Democracy and Humanitarian Assistance ($10,000,000). Together with not less than $746,000,000 from 

the Child Survival and Health Programs Fund, the bill makes 

available $786,000,000,000 for HIV/AIDS. The Committee directs 

that AID include all HIV/AIDS-related activities, such as TB/HIV 

tuberculosis prevention in its reports on achieving these targets. 

OTHER INFECTIOUS DISEASES: MALARIA

The Committee includes not less than the fiscal year 2002 level 

for the prevention of malaria, a re-emerging global killer of children and a major impediment to economic development in many 

poor countries. Serious consideration should be given to a grant 

demonstrating United States support for the Medicines for Malaria 

Venture, a public/private partnership leading the effort to develop 

new, affordable malaria drugs. The Bureau for Democracy and Humanitarian Response is urged to provide not less than $2,500,000 

for malaria from its grant program for private voluntary organizations, consistent with current practice. 

OTHER INFECTIOUS DISEASES: TUBERCULOSIS

The Committee recognizes that tuberculosis (TB) is the major infectious killer of adults in the world, killing between two and three 

million each year. This disease could result in the deaths of up to 

30,000,000 people in the next decade. TB kills more women than 

any other cause of mortality and is the major killer of persons with 

AIDS. Many of these will be parents, whose orphans will be a burden on already stressed societies. In addition, the Committee notes 

the threat to the United States from this disease due to international travel and immigration. An estimated 15 million Americans are currently infected with the TB bacteria. 

Therefore the Committee includes in the allocation for other infectious diseases not less than $85,100,000 from all accounts for 

programs for the prevention, treatment, control of, and research on 

tuberculosis. The Committee encourages USAID to utilize the Global TB Drug Facility (GDF), as well as the Green Light Committee 

17

(GLC) to treat multi-drug resistant TB, and to inform the Committee not later than 30 days after enactment of this Act of the extent of its support for or proposed use of the GDF and the GLC. 

In its last four reports, the Committee requested USAID to assist 

Texas and Mexico combat a particularly threatening outbreak of 

tuberculosis along their border. The Committee regrets that the 

Agency and the Government of Mexico became embroiled in administrative and policy disputes, allowing the shipment of equipment 

to Mexico to be delayed for more than 8 months. The Committee 

expects Agency officials to promptly inform the Chairman of such 

incidents in the future. 

OTHER INFECTIOUS DISEASES: ANTIMICROBIAL RESISTANCE AND

SURVEILLANCE

The Committee supports the efforts of USAID and the Centers 

for Disease Control to reduce the spread of antimicrobial resistance. The Committee is aware of the special problems of infectious 

diseases among patients hospitalized in Asia, Latin America, and 

Africa, and encourages USAID to encourage the use of proven new 

technologies to combat antimicrobial resistance. The Committee 

has been made aware of the work in this area by the Alliance for 

the Prudent Use of Antibiotics (antimicrobial resistance) and the 

International Foundation for the Reduction of Infectious Diseases, 

and suggests that AID cooperate with the Alliance and the Foundation. In addition, AID is encouraged to continue improving capacity 

for surveillance and response to infectious diseases at the national 

and local levels. 

INFECTIOUS DISEASES: COLLABORATIVE RESEARCH BY UNIVERSITY

MEDICAL SCHOOLS

The Committee is aware of and supports the renewed engagement of many United States university medical schools and medical research facilities in the global campaign against infectious diseases, especially those which affect children. As many contributed 

greatly to domestic public health progress in earlier decades, the 

Committee welcomes their interest in the global campaign. 

The Agency for International Development and multilateral 

health and child survival agencies benefiting from this bill are 

urged to give every consideration to detailed proposals submitted 

by the relevant institutions cited in a separate section of this report following the discussion of the ‘‘Development Assistance’’ account. The Committee notes with concern the continuing inability 

of the Agency to successfully collaborate, after many meetings with 

senior officials and numerous prior year report directives, with 

Tulane University, the University of Notre Dame, and Johns Hopkins University on their joint efforts to limit the spread of malaria.

REPRODUCTIVE HEALTH OVERVIEW

The Committee anticipates that at least $56,500,000 for reproductive health/voluntary family planning will be funded from the 

Economic Support Fund, Europe and Eurasia regional accounts, 

and accounts administered by the Bureau for Humanitarian Response. Together with $368,500,000 from the Child Survival and 

Health Programs Fund, the bill total for reproductive health should 

18

be at least $425,000,000, as requested by the President. The Committee directs that USAID include all reproductive health activities, including those funded from other accounts in this bill, in its 

reports on achieving these targets. 

REPRODUCTIVE HEALTH/VOLUNTARY FAMILY PLANNING: RESTRICTIONS

The Committee has continued prior year language in the bill that 

requires that none of the funds appropriated in this bill, or any unobligated balances, be made available to any organization or program which, as determined by the President, supports and participates in the management of a program of coercive abortion or involuntary sterilization. The bill language also states that funds 

cannot be used to pay for the performance of abortions as a method 

of family planning or to motivate or coerce any person to practice 

abortion. Further, the language indicates that in order to reduce 

reliance on abortions in developing countries, population funds 

shall be available only to voluntary family planning projects which 

offer, either directly or through referral, information about access 

to a broad range of family planning methods and services. An additional provision in the bill requires that in awarding grants for natural family planning under section 104 of the Foreign Assistance 

Act, no applicant shall be discriminated against because of such applicant’s religious or conscientious commitment to offer only natural family planning. 

The Committee also has continued prior year language that 

states that nothing in the bill is to alter any existing statutory prohibitions against abortion which are included under section 104 of 

the Foreign Assistance Act. Further, the Committee has continued 

prior year language which states that project service providers or 

referral agents cannot implement or be subject to quotas or other 

numerical targets of total number of births, number of family planning acceptors, or acceptors of a particular method of family planning. 

The Committee is concerned by reports that informed consent 

problems persist in Peru after the implementation of the ‘‘Tiahrt 

Amendment’’ in fiscal year 1999. In fiscal year 2001 the Committee 

asked USAID to conduct an investigation into these allegations and 

report its findings. Also, the Committee directed USAID to provide 

biannual reports regarding the monitoring of this provision. The 

Committee directs USAID to continue such biannual reports on its 

investigations of allegations of violations per the fiscal year 2001 

instructions.

PRIMARY HEALTH CARE IN THE CONGO

The Committee is aware that the vast majority of Congo citizens 

no longer have access to primary health care as a result of wars 

and corrupt governments since its independence in 1960. In addition to its ongoing efforts to support restoration of primary health 

care throughout the former Zaire, the Committee recommends that 

USAID give every consideration to a proposal for support from a 

promising public-private partnership, the Dikembe Mutombo Foundation, to build the first major hospital and teaching facility in 

Kinshasa in almost 40 years. The Committee recommends that up 

to $2,000,000 be allocated over several years to support a FoundaVerDate Sep 04 2002 01:55 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00018 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.001 HR663
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tion proposal to promote primary health care and upgrade surviving clinics and health centers throughout the Congo. 

PUBLIC HEALTH INFRASTRUCTURE IN THE CARIBBEAN

The Committee is concerned about the deteriorating health situation in the countries of the Caribbean region, and urges that 

USAID place greater focus on restoring the health infrastructure 

there. USAID’s Global Health Bureau and the Center for Disease 

Control, in consultation with the Pan American Health Organization, are asked to review the role in regional health of the Caribbean Epidemiology Center (CAREC), headquartered in Trinidad, 

and report, through USAID, to the Committee not later than 

March 14, 2003, on the status of CAREC’s physical infrastructure, 

the scope and effectiveness of its applied public health and field epidemiology programs, and the status of proposals made by CAREC 

to USAID and CDC for funding and technical assistance. The Committee is prepared to support USAID’s share of an overall United 

States Government initiative of up to $10,000,000 to improve public health infrastructure in the Caribbean. 

The Committee is also aware of the interest of INOVA Fairfax 

Hospital in promoting continuing medical and health care education to physicians and nurses in the Pignon region of Haiti, and 

recommends that USAID gives serious consideration to supporting 

such a public-private partnership. 

GRANT TO THE UNITED NATIONS CHILDREN’S FUND (UNICEF)

The Committee supports efforts to reach the child survival goals 

set by the World Summit for Children. In order to implement these 

goals, the Committee is recommending that up to $120,000,000 of 

the funds provided under the Child Survival and Health Programs 

Fund shall be provided as a contribution in grant form to the 

United Nations Children’s Fund. Funding for the United States, 

voluntary contribution to UNICEF and other international organizations has been provided for a number of years on a grant basis 

with minimal direction from the Executive branch or Congress. In 

order to determine whether there should be exceptions to that policy, the Committee requests the Secretary of State to provide the 

Committee not later than February 15, 2003, with a report on the 

policy direction given to UNICEF and similar United Nations affiliates by the United States, direction given by other donor countries, 

and recommendations, if needed, for modification of the current 

system of contributions to such international organizations.

DEVELOPMENT ASSISTANCE

Fiscal year 2002 level ......................................................................... $1,178,000,000

Fiscal year 2003 request .................................................................... 2,839,500,000

Committee recommendation .............................................................. 1,398,000,000

The Committee recommends $1,398,000,000 for the general account for development assistance for economic growth, trade and 

environment. The amount recommended is $1,441,500,000 below 

the budget request and $220,000,000 above the fiscal year 2002 

level. 

Funding in this account includes worldwide activities for free 

market economic development, agriculture, rural development, litVerDate Sep 04 2002 01:55 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00019 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.002 HR663
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eracy and basic education for children and adults, environment, energy, science and technology and other programs related to longerterm development. 

The Committee recommends the continuation of bill language to 

prohibit the use of funds for any activities in contravention of the 

Convention on International Trade in Endangered Species (CITES) 

in order to address concerns that AID funded activities in 

Zimbabwe are contributing to trade in elephant ivory. The Committee recommends the transfer of up to $24,500,000, 

from the ‘‘Development Assistance’’ account, to support develop- ment credit activities instead of $12,500,000 as proposed by the 

President. Should carryover authority from fiscal year 2002 meet 

or exceed the budget estimate, new transfer authority would not 

exceed $12,500,000. 

ECONOMIC GROWTH: OVERVIEW

The Committee considers free market economic growth, and the 

USAID programs designed to lead directly to growth, the Agency’s 

most important objective in Latin America and Asia. Simply put, 

without sustained economic growth, USAID’s development programs for health, population, environment and other purposes, can 

have only marginal long-term benefits in poor countries. 

In the near-term, the Committee continues to support increases 

in USAID resources for health improvement through the ‘‘Child 

Survival and Health Programs’’ account. But improved social conditions of children matter only if the future economies of these countries can provide employment for these healthier, better educated 

citizens. Therefore, the Committee encourages AID to increase 

funding for free market economic development in its development 

programs in each of these regions. 

The Committee continues to support USAID technical assistance 

programs to encourage macro-level economic growth. These include 

programs to assist with privatization of state-run industry and 

legal and regulatory reform to modify trade and tax barriers which 

stifle local entrepreneurs and which deter U.S. investment. In addition, AID technical help for improving energy, transportation, telecommunication, and finance sectors is key to directly improving the 

economic climate of poor countries. Essential to this, of course, AID 

must continue to search out reform-minded government leaders 

without whom these programs cannot succeed. The proposed Millennium Challenge Account is based on this approach. 

The Committee supports the efforts of USAID to better coordinate with the U.S. Trade Representative and other concerned agencies the significant amounts of aid already being committed to assist other countries to strengthen their trade-related laws and regulatory regimes. It is in the United States national interest to ensure that relevant economic growth funds are programmed to complement trade negotiating objectives. 

BASIC EDUCATION

The Committee recognizes that educating children in developing 

countries provides the foundation for sustained economic growth, 

poverty alleviation, and the creation of democratic institutions. 

There is also clear evidence that the collateral benefits of providing 

basic education for girls, including improved child and maternal 

21

health, lower fertility rates, reduced child labor, and increased political participation, make it one of the most effective expenditures 

of U.S. foreign assistance. 

The Committee strongly recommends a minimum level of $250,000,000 from this and other accounts for basic education, an 

increase of more than 50 percent above last year’s recommendation. 

In addition, it encourages AID to place particular emphasis on programs that expand access and quality of education for girls, enhance community and parental participation in schools, improve 

teacher training, and build local management capacity. The Committee also recognizes that USAID’s capacity to create and execute 

innovative and effective basic education programs suffered disproportionately during the reduction in personnel over the last decade, and directs AID to increase the number of direct hire education staff directly supporting and managing field programs. 

The Committee also recognizes the importance of education in 

the fight against HIV/AIDS in developing countries. The pandemic 

has severely affected not only school-age children, but also the 

teacher populations in sub-Saharan Africa. The Committee encourages AID to promote approaches to HIV/AIDS prevention which 

recognize the central role played by schools and teachers, including 

integrating information into curricula, instituting prevention programs in schools, and focusing on HIV/AIDS in teacher training institutes. 

TRADE CAPACITY BUILDING

Trade capacity building is a critical element of development assistance because it can be leveraged to generate economic growth, 

reduce poverty, promote the rule of law, and help provide the much 

needed public resources to finance social investments by developing 

countries. Over time, it plays a catalytic role in helping to leverage 

other resources for sustainable development. 

The committee recognizes USAID’s government-wide surveys 

over the last three years to document all current federal trade capacity building activities. Through these surveys, USAID has demonstrated that the United States is the policy and resource leader 

in the provision of trade capacity building assistance. Nevertheless, 

it has become apparent that USAID lacks a clearly defined, coherent, annual trade capacity building budget process aligned with 

key officials who are empowered to coordinate and approve agency 

programs. Increasingly, it is imperative that these programs be 

consistent and responsive to the demands of developing countries 

and other U.S. Government agencies. At present, the USAID is unable to effectively meet these demands. 

At present, the Agency has the ability to assess its trade capacity 

assistance in a comprehensive way only through retrospective reviews. It does not possess a budget or prospective strategic planning process. The committee strongly encourages USAID efforts to 

improve its effectiveness in trade capacity building assistance. 

Such programs help countries build the capacity to participate in 

the multilateral trading system beyond the border, at the border, 

and behind the border. 

The Committee expects USAID to implement immediately a 

budget planning process that effectively allows the Agency to track 

and implement trade capacity building initiatives at a mission, reVerDate Sep 04 2002 01:55 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00021 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.002 HR663
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gional and central bureau levels for the submission of the President’s FY 2004 budget. 

Concurrent with this effort, not later than sixty days after enactment of this Act, the Committee requests that USAID report on its 

internal structure as it affects trade capacity building development 

assistance and the process of agency/mission coordination with the 

Executive branch’s inter-agency trade capacity building working 

group. In this process, USAID should identify the persons or Agency element responsible for carrying out the following: • Review and coordination of trade capacity building requests by 

developing country trade, finance, and development ministers. • Leadership of the Agency’s participation in the U.S. Government inter-agency process to provide effective trade capacity building assistance to developing countries consistent with U.S. foreign 

and international economic policy objectives. • Communication and coordination of U.S. trade capacity building efforts with multilateral organizations such as OECD, U.N. Development Program, UNCTAD, the World Bank, and the World 

Trade Organization. • Resource allocation, review, and approval of trade capacity 

building initiatives at mission, regional and central bureau levels. 

Not later than 90 days after enactment of this Act, the Committee requests that USAID provide a report identifying the trade 

capacity building strategy of the Agency for deployment of fiscal 

year 2003 resources. Within this strategy, the Committee urges a 

special evaluation on capacity building efforts designed to improve 

transparency, application of best practices in the development of 

commercial law and regulations, and the provision of assistance for 

effective developing country participation in the trade negotiation 

process. 

The Committee is concerned that USAID has not complied with 

the directive regarding support for a Center for Latin American 

Trade Expansion that was included in the Statement of Managers 

accompanying the conference agreement on the fiscal year 2001 

Act, and directs that the Administrator report to the Committee 

not later than December 1, 2002 on the resolution of this long-outstanding issue. 

GLOBAL ISSUES: URBAN PROGRAMS

The Committee is aware that urban populations in developing 

nations are growing rapidly, threatening the quality of life of billions of individuals. Within less than ten years, more people will 

be living in the world’s cities than in its small towns and villages. 

The Committee is concerned that USAID funding for urban programs and associated technical staff has been declining sharply as 

urban growth accelerates. The new $11,000,000 Urban Water Partnership to supply clean water to urban slum dwellers is a welcome 

sign of renewed USAID involvement with alleviation of urban poverty. 

In order to allow renewed focus on urban challenges to economic 

growth and poverty alleviation, the Committee directs USAID to 

provide not less than $10,000,000 for urban programs to support 

field activities within the Economic Growth, Trade and Agriculture 

Bureau. The Committee requests that USAID submit a written report not later than April 10, 2003, including, but not limited to, a 

23

USAID definition of ‘‘urban programs’’, a USAID urban strategy, 

and its central, regional, and country obligations that are classified 

as urban programs during fiscal years 2002 and 2003. 

The Committee supports continuation of the technical assistance 

program of the International Real Property Program (IRRP) to create private real estate markets and promote property rights in ten 

former Soviet Bloc countries. As problems with property rights and 

inefficient property markets characterize many of the countries 

where USAID is active, the Committee endorses expanding the program into selected countries of Latin America, Asia and Africa. The 

Committee recommends that USAID allocate not less than 

$5,000,000 to be divided between the IRPP and an adequate core 

grant for the Institute for Liberty and Democracy. 

The Institute for Liberty and Democracy (ILD) is performing important work in the area of economic growth and poverty reduction 

for populations living in the extra-legal sector. Of the several hurdles many developing countries struggle to overcome, strengthening 

the practice of formalized capitalism within their borders is critically important. The promise of capitalism as a tool for economic 

growth and poverty reduction can never fully be achieved as long 

as large parts of the world’s population have no stake in the capitalist mode of development. 

GLOBAL ISSUES: LITERACY AND EDUCATION

The Committee recognizes that expanding access to education, 

especially combating child and adult illiteracy, is critical to longterm development. 

The Committee supports the work of Alfalit International, an 

educational nongovernmental organization dedicated to promotion 

of literacy, elementary education, and community development in 

Africa and Latin America. Alfalit’s proven record during the past 

three decades has helped significantly reduce child and adult illiteracy throughout Latin America and Africa. The Committee urges 

AID to provide not less than $1,500,000 for Alfalit to jointly develop and implement programs to combat adult illiteracy in additional countries in which USAID operates. 

GLOBAL ISSUES: CLEANER ENERGY, RELIABLE POWER AND THE

ENVIRONMENT

The Committee is aware that many environment challenges, 

from urban pollution to rural deforestation, are a result of failures 

to develop cleaner energy and more efficient power sources. Where 

lead continues to be used in gasoline, diesel generators substituted 

for electricity from unreliable grids, and areas surrounding towns 

and villages are denuded of vegetation in the daily search for cooking fuel, humans and their environment are degraded. The Committee welcomes the new focus of the President and Secretary of 

State on power generation for sustainable development. 

Immediate benefits to human health and economic development 

would result from support for effective programs to reduce lead and 

sulfur in gasoline and for reduction of indoor pollution in households resulting from indoor cooking and heating. A number of nongovernmental organizations, such as the Global Lead Network, are 

already involved in these efforts, and could expand them with support from USAID. Such programs can use Development Assistance 

24

funds to improve health as well as promote economic development. 

Over a longer-term, technical assistance to improve energy use by 

municipalities, state-owned enterprises, and large land-holders, all 

of which often waste energy because of subsidized power, and introduction of modern, more efficient technologies for power generation, 

as demonstrated in regions of India with USAID support, will promote economic growth and improve the quality of life. 

As a key renewable element of the power for sustainable development initiative, the Committee propounds a renewed emphasis on 

hydropower, using an initial multi-year grant of up to $3,000,000 

to a specialized non-governmental organization representing the 

U.S. hydropower industry to provide project development and implementation services. As with other power and energy sectors, 

USAID has a key role in assisting foreign governments, international financial institutions, and the local private sector to establish necessary energy and investment framework and governance 

practices in emerging markets. 

The Committee notes the undue delay in renewing existing central procurement mechanisms that are needed to access U.S. forprofit private sector providers of expertise and assistance in the energy/environment sector, and urges the Economic Growth, Agriculture and Trade Bureau and the Office of Procurement to expedite the necessary contracts to facilitate implementation of the 

power for sustainable development initiative. 

GLOBAL ISSUES: ACCESS TO CLEAN WATER AND WATER MANAGEMENT

The Committee is pleased that the Administration is directing 

additional resources toward clean water and water management, 

more than $350,000,000 in fiscal year 2003. Competition for scarce 

fresh water is already predicted to be a major source of international conflict during the 21st Century, as it is now within the 

Middle East. Elsewhere, intra-regional cooperative programs in 

water management from the Indus Water Agreement between 

India and Pakistan more than 40 years ago to the new South Asia 

Water Resources Program are notable accomplishments for international development assistance. The Committee requests that the 

Administrator of USAID submit a brief written report to the Committee within 90 days of enactment of this Act detailing the Agency’s programs and activities relating to clean water and efficient 

use of fresh water resources. 

GLOBAL ISSUES: THE ROLE OF GIRLS AND WOMEN IN DEVELOPMENT

The Committee recognizes the importance of improving the economic and social situation of women and girls through respect for 

legal rights and expanded access to educational opportunities, adequate health care, and credit. 

The Committee has a history of support for the Office of Women 

in Development (WID), and has, in previous years, directed that 

not less than $15,000,000 be allocated to sustain the activities of 

the WID office. As USAID has undergone its recent reorganization, 

and as the agency and the development community overall have 

developed an enhanced awareness of the importance of integrating 

women into development strategies, the Committee concludes that 

both the form and the function of the WID office must evolve in 

25

order to ensure women and development issues remain a high priority. 

The Committee recommends that USAID replace the existing 

WID office, currently housed in the Bureau for Economic Growth 

and Trade, with a new Office for Women and Effective Development, to be housed in the Policy and Program Coordination (PPC) 

bureau. The office should have adequate direct hire staff and funding to secure its place as a resource for all of USAID’s functional 

and geographic bureaus and, as the agency further decentralizes 

programming decisions, to the missions themselves. Further, the 

office should have the capacity and the mandate to participate in 

strategic planning and policy development agency-wide. 

The Committee recommends that the new Office for Women and 

Effective Development be headed by a senior USAID official with 

both field experience and expertise in gender and development 

issues. The director should have liaison counterparts within each 

functional and geographic bureau to ensure proper communication. 

The Office for Women and Effective Development should have operating expenses sufficient to hire a robust, permanent staff, and the 

budget capacity to conduct limited programming, provide technical 

assistance to missions and bureaus, and the ability to provide incentive funds to missions seeking to invest in upgrading the integration of gender into their programs. 

WOMEN’S LEADERSHIP TRAINING

The Committee reiterates language from last year’s report concerning support for women’s leadership. As USAID has paid minimal attention to this issue and the Committee’s guidance, 

$10,000,000 is provided within the Development Assistance account 

only for women’s leadership training programs. The Committee directs that during the first two years, these funds are to be managed by the Bureau for Democracy, Conflict, and Humanitarian Assistance, including its Office of Transition Initiatives. Funds provided under this directive may be used for various aspects of women’s leadership training, including: training women to participate 

in local, regional and national political processes, facilitating women’s involvement in reconciliation and reconstruction processes in 

conflictive and post-conflict societies, and building capacity of 

women-led private voluntary organizations to advocate for reform 

of local legislatures, judicial systems, and security agencies. The 

Committee directs USAID to submit a written plan for obligation 

of these funds, including a schedule for individual components, not 

later than 90 days after the enactment of this Act. 

GLOBAL ISSUES: BIODIVERSITY

The Committee applauds the accomplishments of AID in integrating biodiversity and forest management in its economic and social development programs. The Committee urges AID to provide 

not less than $70,000,000 in fiscal year 2003 for its biodiversity 

programs. 

The Committee welcomes the presidential initiative to conserve 

the forests of the Congo River Basin, building on USAID’s Central 

African Regional Program for the Environment, and encourages the 

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private partnership in a region where conflict and poverty threaten 

the world’s second largest block of intact tropical forest. 

The Committee again recommends that AID provide $500,000 to 

support the Peregrine Fund’s Neotropical Raptor Center in Panama to conserve birds of prey in the Panama Canal watershed area 

and throughout the new-tropics. The Committee notes that the 

Center expects to receive matching private financing for this 

project. 

ECONOMIC GROWTH: COLLABORATIVE RESEARCH SUPPORT PROGRAMS

The Committee supports the continuation of the collaborative research support programs (CRSPs) and urges USAID to increase 

funding for the CRSPs in fiscal year 2003. The Committee believes 

that CRSPs, such as the Peanut CRSP established in 1982, are 

clearly one of USAID’s best investments, funding for which should 

be increased rather than reduced. The Committee notes that agricultural research and development has led to greater economic development, increased income, and a more available food supply for 

the world’s poor. The Committee is aware of a new process to increase agricultural production in arid areas that would greatly aid 

in the reduction of world hunger. The Committee supports a grant 

to a participating university to conduct a demonstration project in 

a developing country that utilizes this new agricultural technique 

during 2003. 

ECONOMIC GROWTH: MICROENTERPRISE

Microenterprise, while unable to alter economic indicators on a 

national scale, can significantly improve personal and family incomes, thus providing money for school fees, health supplies, and 

more nutritious food, and stimulating economic growth at the community level. The Committee expects AID to exceed the authorization level enacted by Public Law 106–309, and to reach a total of 

$175,000,000. Also, programs of importance to economic growth, 

such as girls’ and women’s education and training programs, can 

assist in opening the marketplace to females. 

ECONOMIC GROWTH: DEVELOPMENT OF VOLUNTARY COOPERATION

THROUGH CREDIT UNIONS AND COOPERATIVES

The Committee encourages USAID to more fully utilize U.S. 

credit unions and cooperatives in its overseas programs, especially 

as the Agency continues to reinvigorate rural development and agriculture programs. The Committee continues to support cooperatives and credit unions as a means to lift families out of poverty 

through self-help and collective entrepreneurship. In a recent report to Congress, USAID established a new agenda for its relations 

with U.S. credit unions and cooperatives. The report emphasizes 

their use in post-conflict localities and communities affect by HIV/

AIDS. 

The Committee is aware of the World Council of Credit Unions’

(WOCCU) international credit development activities, especially its 

efforts to further develop credit union systems in Mexico and South 

Africa. The Committee recommends that favorable consideration be 

given to proposals by the WOCCU to participate in multi-year imVerDate Sep 04 2002 01:55 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00026 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.002 HR663
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plementation of USAID economic growth strategies in those countries. 

The USAID Office of Private Voluntary Cooperation (PVC) is 

urged to allocate not less than $8,000,000 in fiscal year 2003 in 

support of capacity building and dissemination of cooperative approaches to development. The Committee expects PVC to provide 

more pro-active information and program support for cooperatives 

seeking to work with USAID field missions whose strategies include economic growth objectives. Strong central support from PVC 

is essential, particularly for agribusiness development and community infrastructure activities involving better telecommunications 

and reliable electric power. 

GLOBAL ISSUES: COFFEE PRICE CRISIS

The Committee is concerned that 25 million coffee growers, many 

in Central America and Colombia, have been left destitute by a 70 

percent drop in coffee prices since 1997. In several dozen countries, 

coffee is a critical source of rural employment and foreign exchange, and its price collapse threatens social and political stability. Current assistance programs for coffee-growing areas are insufficient, and sometimes worsen the situation. 

The Committee urges USAID to focus its rural development and 

relief programs on regions severely affected by the coffee crisis, especially in Colombia. A new general provision, section 551, directs 

USAID to focus development and relief resources in Central American countries where the adverse impact of the coffee crisis has 

dramatically increased abject poverty, especially in Nicaragua and 

Honduras. 

The Committee also supports efforts of the Polus Center for Social and Economic Development to expand humanitarian and rehabilitative services to landmine victims in both countries, and the 

programs of the Fabretto Children’s Foundation in Nicaragua. 

LATIN AMERICA AND THE CARIBBEAN: OVERVIEW

The Committee is pleased that USAID has responded to report 

language from prior years urging that greater emphasis be provided for programs in Latin America and the Caribbean. The Committee reiterates its intention that the allocation of funds for this 

region from Development Assistance and the Economic Support 

Fund should be at least at the combined level for both accounts in 

fiscal year 2002. 

Although the chain of events that have threatened the financial 

and, in some cases political, stability of Argentina and Brazil directly challenge the effectiveness of the international financial institutions funded in title IV of this Act, and activities to support 

Colombia and other Andean nations are largely funded under the 

Andean Counterdrug Initiative, development assistance has a potentially key role in reducing poverty and hunger in Central America and the Caribbean. 

The Andean and Central America/Caribbean regions, especially, 

would benefit from trade capacity building assistance, including 

that related to agricultural exports.

28

LATIN AMERICA AND THE CARIBBEAN: PARKS IN PERIL

The Committee notes its strong support for the existing AID 

Parks in Peril program, a partnership with the private sector to 

promote biodiversity conservation in imperiled ecosystems throughout Latin America and the Caribbean. The Committee believes that 

protection of rare ecosystems is important from an environmental 

standpoint and also serves the long-term economic interests of 

these nations and the interests of the United States. 

LATIN AMERICA AND THE CARIBBEAN: CORPS OF ENGINEERS

The Committee is pleased that the State Department and USAID 

have begun to utilize the planning, engineering and design, environmental, and technical capabilities of the U.S. Army Corps of Engineers, particularly in Latin America where the Corps has existing 

field offices in Honduras, El Salvador, Panama, Colombia, Bolivia, 

and Peru. A partnership between the Corps and AID that takes advantage of these capabilities can significantly contribute to the 

strategic interests of the United States. The Committee intends 

that the State Department and AID use the Corps to a greater extent to support such activities as child survival (water and sanitation); development assistance; disaster assistance; and transition 

initiatives. Further, the Committee expects that the Department of 

State and AID will not establish additional engineering capabilities 

for activities that can be accomplished by the Corps. The Committee again requests that AID and the Department of State report 

separately within 60 days of enactment into law of this Act regarding plans to develop programs with the Corps during fiscal year 

2003, including a Memorandum of Agreement with the Corps. 

MEXICO

The Committee is concerned that the Republic of Mexico has unilaterally closed United States sport fishing access to the 

Revillagigedo Islands. The sport fishing industry provides approximately $5,500,000 in direct revenue to Southern California and employs hundreds of people. The United States and Mexico have 

maintained a cooperative working relationship with regard to fishing and environmental issues, and United States boats have had 

access to the Revillagigedo Islands under permits since 1994. The 

Government of Mexico withdrew these permits in March 2002 and 

closed the islands to United States sport fishing. The Committee 

directs the Secretary of State to initiate discussions with Mexico to 

achieve a resolution allowing the United States sport fishing fleet 

to return to fishing the islands. 

AFRICA: AGRICULTURAL IMPROVEMENTS TO REDUCE HUNGER

Reducing hunger in Africa is the most significant accomplishment needed to meet the international goal of reducing by half the 

number of severely malnourished and impoverished people by 2015. 

As Africa is the one continent where hunger is increasing, the 

Committee agrees with Presidents Bush and Clinton that it is imperative to attempt to make agriculture an engine of growth in 

suitable areas of the continent. The 25 percent increase in funding 

for agricultural production and trade in sub-Saharan Africa would 

bring the total to $148,000,000 in fiscal year 2003. New and proven 

29

approaches based on science and technology, ranging from biofortification for micronutrition to vermiculture for more fertile soil, 

must be examined and used where appropriate to boost agricultural production. The Committee welcomes the renewed focus in 

Africa on agricultural policy reform and agricultural trade infrastructure and capacity building, indicating that lessons from the 

failure of prior donor advice have been identified and taken to 

heart. 

Additionally, the Committee urges USAID to maximize its assistance for the provision of seeds and agricultural imputs to help 

farmers recover and begin planting crops for the next harvest as 

a key component of reducing hunger in Africa. 

AFRICA: ASSISTANCE TO SOUTHERN SUDAN AND LIBERIA

The Committee commends the Administration for its efforts to 

bring peace to the people of southern Sudan. Further, the Committee remains concerned about the credible reports of trafficking 

of human beings and slavery in Sudan. The Committee continues 

its support for Operation Lifeline Sudan (OLS), a multilateral effort to provide desperately needed food and humanitarian relief to 

southern Sudan. 

The Committee also reiterates its endorsement of proposals to 

promote democracy and non-governmental organizations, such as 

the Archdiocese of Monrovia, in Liberia. 

AFRICA: EDUCATION INITIATIVES

The Committee notes that both Presidents Bush and Clinton 

have given priority to improving education in Africa. As the most 

recent presidential initiative is moving toward implementation, the 

Committee again notes the Education for Development and Democracy Initiative (EDDI) record of accomplishment over the past two 

years. As EDDI is incorporated in the latest presidential initiative, 

the Committee continues to support the educational, technology 

transfer, and trade capacity components of EDDI, and urges that 

they be continued. 

AFRICA: FARMER-TO-FARMER PROGRAM

The Committee notes with approval efforts made this year by 

USAID in collaboration with the Department of Agriculture to expand the Farmer-to-Farmer Program in Africa. Programs that link 

American universities and producers with those of other nations 

are valuable tools in providing meaningful assistance to people at 

a critical period of economic development. The Committee encourages the Agency to expand such programs as it increases its focus 

on agriculture and rural development. 

ASIA: OVERVIEW

The Committee notes that Asia (beyond the Middle East) is a region of paramount strategic and economic importance to the United 

States. This is particularly evident since the events of September 

11, 2001. 

As the Committee stated in last year’s report, ‘‘While Asia represents the greatest potential for growth in U.S. exports and investment opportunities, systemic legal, social and economic weakVerDate Sep 04 2002 01:55 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00029 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.002 HR663
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nesses throughout the region continue to threaten these interests.’’

The Committee notes that South and East Asia still contain the 

largest concentration of poor people in the world, as well as the 

greatest land mass at risk of environmental degradation through 

poorly managed growth. 

Technical assistance in support of updated commercial policies 

and legal structures also promotes United States trade with, and 

investment in, Asia. This approach to development assistance 

should continue to be a high priority, and the Committee again directs the Agency to make available, for a third year, $60,000,000 

for this purpose. The Agency is urged to provide sufficient operating expenses to effectively manage and oversee economic growth 

and other commercial and trade related programs in Asia, especially those in countries where AID does not have a field mission 

presence. Consideration should be given to opening additional 

USAID missions in countries where assistance levels exceed 

$10,000,000. 

AMERICAN SCHOOLS AND HOSPITALS ABROAD (ASHA)

The Committee directs AID to provide up to $20,000,000 for the 

American Schools and Hospitals Abroad (ASHA) program in fiscal 

year 2003. The Committee directs that none of these funds be reserved for programming in any future fiscal year. All funds are to 

be allocated and obligated in fiscal year 2003. The Committee further expects that support will be continued, as new resources are 

needed, for traditional recipients in the Middle East. The Committee expects AID to keep it currently informed regarding institutions which have received ASHA funding in previous years, but 

which continue to have significant unexpended balances. In addition, funds should be made available for other deserving institutions in all geographical regions, especially in sub-Saharan Africa. 

CASS SCHOLARSHIP PROGRAM

The Committee continues to support the work of the Cooperative 

Association of States for Scholarships (CASS) and supports continued funding for CASS and the extension of its cooperative agreement with USAID. The Committee encourages USAID to work with 

CASS to meet the current demand from existing program countries, and to accommodate requests from several additional countries for services provided by the program. 

INTERNATIONAL FERTILIZER DEVELOPMENT CENTER

The Committee strongly supports the fertilizer-related research 

and development being conducted by the International Fertilizer 

Development Center (IFDC) and urges the Administrator of USAID 

to make $2,300,000 available for the core grant to IFDC, a center 

established to support AID. 

DAIRY DEVELOPMENT

Information provided by USAID indicates that the agency recently provided $18,600,000 to development projects connected to 

the dairy industry in developing economies. These projects have 

provided safe, nutritious and affordable food to the local populations, fostered growth of small businesses through reform of forVerDate Sep 04 2002 01:55 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00030 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.002 HR663
31

eign government policies, and empowered stakeholders in local 

projects, especially women, through job creation and increased incomes—and continue to do so today. Such projects also allow the 

U.S. dairy industry to be more competitive by promoting American 

technology, equipment, inputs and industry-based technical assistance abroad. As USAID continues to develop its priorities in developing agricultural capacity around the world, the Committee 

strongly recommends that USAID continue its support for dairy-related programs. 

The Committee directs USAID to fund such programs at not less 

than $25,000,000 for fiscal year 2003. Of this amount, the Committee recommends that at least $10,000,000 be made available for 

new projects at missions supplementing their existing rural development programs with a dairy component. These projects should 

facilitate efforts by U.S. dairy livestock businesses and organizations to engage emerging markets in developing local sustainable 

enterprises capable of delivering dairy livestock-related goods and 

services. The Committee recognizes the management needs of 

USAID in overseeing this program, and supports the use of a reasonable amount of operating expenses by the Economic Growth, 

Agriculture and Trade Bureau to meet its administrative burden. 

The Committee directs USAID to provide a report not later than 

March 31, 2003, outlining its actions in meeting the above directives. 

TORTURE TREATMENT CENTERS

Supporting treatment centers as permanent national institutions 

is the best way of providing treatment services to victims of torture 

and advocating for the elimination of torture globally. Accordingly, 

the Committee recommends $10,000,000 for AID to support foreign 

treatment centers for victims of torture as authorized by the Torture Victims Relief Act and the Torture Victims Relief Reauthorization Act of 1999. 

The Committee recommends that USAID significantly increase 

its direct financial support for the centers’ basic treatment services 

while maintaining an adequate level of support for training and 

technical assistance. The Committee requests that USAID provide 

a brief written report not later than February 15, 2003, on implementation of this recommendation. 

UNITED STATES UNIVERSITY SUPPORT FOR DEVELOPING COUNTRIES

The Committee continues to receive numerous requests to fund 

specific activities at or through American institutions of higher 

education. The Committee strongly supports activities that advance 

international development and U.S. foreign policy goals. The Committee has reviewed the concepts proposed for funding, and recommends that USAID and/or the Department of State (as appropriate for the proposed project) actively consider proposals submitted by the following organizations. 

Unless a proposal demonstrates a unique, innovative, or proprietary capability, or demonstrates special considerations that justify 

limited or non-competitive treatment, the Committee expects that 

competitive procedures will be applied with regard to the proposals 

on the list that follows. The Committee also expects AID to give 

32

priority to proposals that have technical merit, realistic budgets, 

and achievable objectives. 

No later than February 28, 2003, the Agency for International 

Development shall submit a report to the Committee on the status 

of each activity identified below. Such report shall include: (1) the 

status of a funding proposal by the organization associated with 

each activity; (2) the degree to which the proposal is consistent 

with United States development assistance and foreign policy goals 

for the country or region in which the activity would take place; (3) 

the degree to which matching or other funds would be provided by 

the organization to complement the Federal contribution; (4) to the 

extent known at the time, any decision by AID or the Department 

of State on funding the activity, including the proposed funding 

level; and (5) any other relevant information deemed important by 

AID or the Department of State. The Committee also expects to receive a second report on the status of these proposals no later than 

September 5, 2003. In addition, the Committee requests that AID 

identify an office or organization within the agency, or within the 

Department of State if appropriate, to which inquiries can be directed on the status of these proposals. 

With the foregoing in mind, the Committee recommends the following proposals for AID’s active consideration: 

A proposal by Mississippi State University for the continuation of its International Agribusiness Development Program, 

including activities to add value to production and reduce postharvest losses; 

A proposal by Loma Linda University for its healthcare programs in developing countries;

A proposal by Florida State University to fund a distance 

learning program of instruction in basic legal principles for 

students and professionals in Central Asia; 

Proposals by Marquette University’s project to train a sustainable nursing workforce for HIV/AIDS Care and Counseling 

in Kenya, and by its Les Aspin Center for Government for continuing training in democracy, leadership, and HIV/AIDS education in Kenya, Ghana, and Nigeria; 

A proposal by the National Center for Computational 

Hydroscience and Engineering (NCCHE) at the University of 

Mississippi for the purpose of transferring state of the art technology to Belize through programs to enhance waterways navigation safety, flood prediction and prevention, water resources 

engineering, environmental and ecological impact assessment, 

and soil conservation; 

A proposal by Ave Maria College of the Americas to continue 

federal funding of its scholarship program to support economic 

reconstruction within Nicaragua through higher education of 

disadvantaged students, mostly women from rural areas, until 

adequate private and corporate support can be secured; 

A proposal by a consortium of schools of tropical public 

health at Tulane University, the University of Notre Dame, 

and Johns Hopkins University to expand programs to reduce 

the global reemergence of malaria; 

A proposal by the University of Miami-Institute for Cuban 

and Cuban-American Studies to participate in the Cuban Transition Project; 

33

A proposal by Arizona State University on behalf of its US/

Andean Partnership for Science Education; 

A proposal by LaRoche College-Pacem in Terris Institute to 

expand its international private/public scholarship programs; 

A proposal by New York University-Robert F. Wagner School 

for Public Service to establish distance learning and communications technology programs at an International Center for 

Democratic Public Service; 

Proposals by Louisiana State University to develop 

mariculture in Namibia and by its School of Law-Commercial 

Law Program of the Americas to support intra-hemispheric 

trade; 

A proposal by San Diego State University to develop the 

South Asia Water Resources Program to promote efficient use 

of water through agriculture sector training and transnational 

cooperation on the efficient use of shared water resources; 

A proposal by Dartmouth College and a consortium of public 

and private institutions to enhance information technology development in Lithuania; 

Proposals by the Morehouse School of Medicine to expand its 

field activities in Africa, especially with regard to HIV/AIDS 

and childhood infectious diseases; 

A proposal by the Atlanta-Tiblisi Healthcare Partnership, 

consisting of Emory University, Georgia State University, 

Morehouse School of Medicine, Georgia Institute of Technology, 

and Grady Memorial Hospital, to continue and expand its support of healthcare infrastructure in the Republic of Georgia; 

A proposal by the University of Alabama at Birmingham 

School of Public Health, the Johns Hopkins School of Public 

Health and Hygiene, and the Gorgas Memorial Institute for 

Tropical and Preventive Medicine, Inc. to continue their tuberculosis control programs in Russia, Latin America, Southeast 

Asia, and South Africa; 

A proposal by Educational Advancement Alliance on behalf 

of the proposed Caribbean American Mission for Education Research and Action initiative to elevate the condition of people 

of the Caribbean using U.S. expertise in educational methodologies as the major vehicle; 

A proposal by Seton Hall University’s School of Diplomacy 

and International Relations to utilize its Middle East and East 

Asia regional studies programs for development assistance; 

A proposal by Boston University/African Presidential Archives and Research Center for the study of democratization 

and market reform in Africa; 

A proposal by the University of Arizona/Sino-U.S. Center for 

Soil and Water Conservation and Environmental Protection for 

an exchange or training programs relating to sustainable food, 

fresh water and clean air resources in western China; 

A proposal by the University of Arkansas to continue its 

partnership with Volgograd State Medical Academy in Russia; 

A proposal by Midwestern State University in Wichita Falls 

to support its MSU/Caribbean Recruitment Program; 

A proposal by the Kroc Institute for International Peace 

Studies at the University of Notre Dame to support regional 

34

religious and cultural institutions in non-violent solutions to 

problems in Muslim societies; 

A proposal by Historically Black Colleges and Universities to 

strengthen and increase their participation in education efforts 

targeting Africa and its people; 

A proposal from Florida International University for a program to help countries manage international trade relations; 

A proposal by the University of Nebraska, Medical Center 

Office of International Health Care Services to combat a range 

of infectious diseases; 

A proposal by the University of Nebraska, Omaha to further 

expand efforts to provide basic education in Afghanistan; 

A proposal by the University of Northern Iowa to support the 

Orava Project in eastern Europe; this project has successfully 

worked with educators in Slovakia to incorporate democratic 

concepts and practices into schools and teacher education programs; and 

A proposal by George Mason University to develop an academic center of excellence for the trade capacity building technical assistance; 

A proposal to support establishment of an Asian University 

for Women in Bangladesh; 

A proposal by Florida A&M University to fund a distance 

learning education program in Ghana. 

INTERNATIONAL DISASTER ASSISTANCE

Fiscal year 2002 level ......................................................................... $235,500,000 

Emergency supplemental funding ..................................................... 90,000,000 

Fiscal year 2003 request .................................................................... 285,500,000 

Committee recommendation .............................................................. 315,500,000

The Committee recommends $296,000,000 for the International 

Disaster Assistance account, $30,000,000 above the request and 

$10,000,000 below the fiscal year 2002 enacted level including 

emergency supplemental funding. 

The Committee recommendation includes the President’s request 

of $50,000,000 for disaster assistance for the West Bank and Gaza, 

to remain available until expended. The Committee recommendation also provides that none of the funds appropriated for this purpose may be obligated or expended with respect to providing funds 

to the Palestinian Authority. The bill language on this matter is 

the same as that contained in the contingent emergency appropriation for disaster assistance for the West Bank and Gaza in Public 

Law 107–206. The funding limitation is consistent with the provisions of section 552 of this Act (‘‘Limitation on Assistance to the 

Palestinian Authority’’). The Committee directs that all funds appropriated for the West Bank and Gaza under this heading shall 

be made available for humanitarian assistance only through nongovernmental organizations. 

The Committee again requests two one-time reports from the Administrator of USAID: within 30 days of enactment of the bill, a 

report on the planned allocation of International Disaster Assistance Funds, including an appropriate amount for reconstruction activities proposed to be undertaken for victims of natural disasters; 

and within 90 days of enactment, a report on the Agency’s recommendations for future budgeting for developmental relief to alVerDate Sep 04 2002 01:55 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00034 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.003 HR663
35

leviate ongoing complex humanitarian disasters, such as in Sudan, 

from the disaster assistance and other AID-managed accounts. 

AFGHAN WOMEN’S CENTERS

The Committee reiterates its support for multi-service women’s 

centers throughout Afghanistan that are being established by the 

Ministry for Women’s Affairs. The Committee directs USAID to implement the directives relating the Ministry that are contained in 

House Report 107–583. In addition to the $2,500,000 provided for 

this purpose in P.L. 107–206, the Committee urges USAID to provide an additional $2,500,000 for the Women’s Centers from funds 

made available in this Act. 

REPORTS ON AFGHANISTAN AND SUDAN

As the United States has played a major role in the peace process in Sudan to date, it is likely to continue its lead role in the 

transition from humanitarian aid to rehabilitation and development. The Committee has been made aware that support for a just 

peace settlement in Sudan may require as much as $60,000,000 

from the ‘‘International Disaster Assistance’’ and ‘‘Transition Initiative’’ accounts for support of the following: reintegration of internally displaced persons and refugees; demobilization of soldiers and 

reconciliation among communities; basic infrastructure such as 

roads and communications systems, and health care, combating infectious diseases, and provision of clean water. The Committee is 

unaware of any budget request that would enable the United 

States to undertake a rapid and effective response to a peace agreement in Sudan that is being brokered by the United States. 

Although the September 3, 2002 budget amendments of the 

President did not include any request for Afghanistan, the Committee is recommending, in a general provision (section 523) that 

not less than $295,500,000 shall be provided for Afghanistan, but 

notes that at least $300,000,000 or more is required to support 

post-Taliban Afghanistan in fiscal year 2003. 

In an attempt to rectify this situation during the remaining 

weeks of the fiscal year 2003 appropriations process, the Committee requests that the Secretary of State and the Director of the 

Office of Management and Budget jointly provide the Committee, 

as soon as possible, a comprehensive financial plan detailing the 

economic and humanitarian assistance required to bring to a successful conclusion United States initiatives in Sudan and Afghanistan. 

TRANSITION INITIATIVES

Fiscal year 2002 level ......................................................................... $50,000,000 

Fiscal year 2003 request .................................................................... 55,000,000 

Committee recommendation .............................................................. 40,000,000 

The Committee recommends $40,000,000 for this account, compared to the budget request of $55,000,000. The Committee does 

not preclude USAID’s Office of Transition Activities from using resources transferred from other development accounts in this Act. 

Also, the Committee requests that USAID report on a semi-annual 

basis the expenditure and specific use of funds by OTI.

36

DEVELOPMENT CREDIT AUTHORITY

(INCLUDING TRANSFER OF FUNDS)

PROGRAM ACCOUNT

Fiscal year 2002 level ......................................................................... ............................

(by transfer) ................................................................................. ($18,500,000) 

Fiscal year 2003 request .................................................................... ............................

(by transfer) ................................................................................. (—) 

Committee recommendation .............................................................. ............................

(by transfer) ................................................................................. (—) 

ADMINISTRATIVE EXPENSES

Fiscal year 2002 level ......................................................................... $7,500,000 

Fiscal year 2003 request .................................................................... 7,591,000 

Committee recommendation .............................................................. 7,591,000 

The Committee recommends a ceiling of $24,500,000 on the 

amount that may be transferred from bilateral economic assistance 

accounts for the subsidy cost of loan guarantees under the Development Credit Authority program. The ceiling is reduced by the 

amount of any unobligated balances remaining from transfers pursuant to the fiscal year 2002 Act. 

The Committee recommends $7,591,000 for administrative expenses, the same as the requested level. 

PAYMENT TO THE FOREIGN SERVICE RETIREMENT AND DISABILITY

FUND

Fiscal year 2002 level ......................................................................... $44,880,000 

Fiscal year 2003 request .................................................................... 45,200,000 

Committee recommendation .............................................................. 45,200,000 

The Committee has provided the budget request for the mandatory payment to the Foreign Service Retirement and Disability 

Fund. 

OPERATING EXPENSES OF THE UNITED STATES AGENCY FOR

INTERNATIONAL DEVELOPMENT

Fiscal year 2002 level ......................................................................... $549,000,000 

Emergency funding ............................................................................ 7,000,000 

Fiscal year 2003 request .................................................................... 572,200,000 

Committee recommendation .............................................................. 572,200,000 

The Committee has recommended funding for United States 

Agency for International Development operating expenses at a 

level of $572,200,000, which is the same as the Administration’s request. The Committee has once again included a provision requiring USAID to notify the Committee in advance of opening any new 

mission overseas and of any capital construction of missions or purchase or long-term lease of offices. The reporting requirement also 

applies to funds appropriated under the heading ‘‘Capital Investment Fund’’. 

FINANCIAL MANAGEMENT CHALLENGES

Since 1997, the Inspector General’s office has not been in a position to provide an unqualified opinion on USAID’s financial management because its accounting systems do not produce reliable 

and timely information. In 2001, the Inspector General’s office was 

37

able to provide a qualified opinion on three of the five essential financial statements mandated by the Federal Financial Management Improvement Act. Qualified opinions were rendered on 

USAID’s balance sheet, the statement of changes in net position, 

and the statement on budgetary resources. However, the IG was 

not able to express an opinion on the statement on net cost and 

statement of financing. The Committee recognizes that USAID has 

made substantial progress in financial management allowing for at 

least a qualified audit to be issued for the first time in three areas 

since 1997. However, the Committee continues to be disappointed 

that the lead development agency of the U.S. Government is unable 

to adhere to financial management practices that allow for annual, 

routine audits of its operations. 

That being said, the Committee would note that the underlying 

critical issue does not relate to the Inspector General’s ability to 

provide a clean, unqualified audit of the agency’s operations. The 

paramount issue is the fact that agency managers do not have the 

ability to obtain timely, reliable, and complete financial and performance data on foreign assistance programs on a consistent 

basis. If agency managers possessed this fundamental managerial 

ability, they would be in a much better position to know the status 

of operations on a day to day basis. 

In its semiannual report to Congress, the Inspector General reported that USAID requires financial systems that integrate on a 

world wide basis, support day to day business operations, produce 

statements without the need for large infusions of agency or contractor resources, and include a cost accounting module that agency 

managers can use to relate costs to program performance. Specifically, the IG has noted that the agency is not able to attribute costs 

to organizations, locations, programs, and activities in a timely 

manner. As a result, the tendency of the Agency is to focus resources on program implementation and operations at the expense 

of proper program evaluation and reporting. 

The Committee strongly encourages USAID to conduct one or 

more pilot programs for the rollout of a worldwide, integrated financial management system that will meet standards established 

by the Federal Financial Management Improvement Act of 1996 

and standards established by the Federal Accounting Standards 

Advisory Board, and will allow the agency to produce financial 

statements in accordance with the 1994 GMRA. Within thirty days 

after enactment, the Administrator of USAID should report to the 

Committee in writing on the proposed pilot, including dates of commencement and termination. This proposal should include the rationale for not pursuing a joint USAID-State Department financial 

management system or other potential options as well as a timeline 

and cost for worldwide implementation. The pilot should commence 

not later than January 6th, 2003. 

INFORMATION TECHNOLOGY

The electronic mail system at USAID is particularly essential 

since the new restrictions placed on mail and courier service since 

September 11, 2001. The Committee directs USAID to evaluate the 

capacity and reliability of its electronic mail system, and to report 

on its findings not later than 30 days after the enactment of this 

Act.

38

HUMAN RESOURCES

The Committee is concerned that the agency is failing to adequately address its current and future human resource needs necessary to meet the current and rapidly evolving foreign policy challenges of the United States. Specifically, the Committee is very concerned that the agency does not possess a reliable, comprehensive 

ability to evaluate and align the deployment of personnel and staff 

(irrespective of hiring status) with agency priorities, resources, and 

budget preparation processes. The lack of this managerial capability appears to have directly impacted the agency’s ability to shift 

human resources to Afghanistan where U.S. foreign assistance 

forms an important part of the strategy to support the interim Afghan government. 

In the future, both in light of a scale up of U.S. resources to fight 

the HIV/AIDS pandemic as well as the natural progression of retirements within the agency, USAID faces tremendous human resource challenges. By 2005, almost 60 percent of the U.S. direct 

hire foreign service personnel will be eligible for retirement. In the 

same year, thirty percent of the agency’s civil service personnel will 

be eligible for retirement, an amount three times what it is today. 

Separate from these sobering trends, the Committee notes that 

USAID has experienced a decline in both Foreign Service and Civil 

Service staff as a percentage of total work force from 1995 to 2000. 

In 1995, Foreign Service and Civil Service staff represented about 

15.1 and 16.1 percent respectively of the total workforce. By 2001, 

the percent had dropped to 13.3 and 12.8 percent respectively. The 

committee is concerned that accompanying this increase is a continued tendency for USAID to rely on non-foreign service officers 

for the performance of core USG responsibilities, specifically overseas procurement. 

The agency’s proposed staffing pattern system (E-World) scheduled for roll out and completion by early November 2002 is a step 

in the right direction toward improved human resources management and meeting this challenge. This new system, nonetheless, 

appears not to report on the number of institutional contractors 

working toward an agency strategic objective. The Committee 

awaits this new system’s operational capacity and encourages 

USAID to make sure it includes data on institutional contractors 

to facilitate budget planning and execution purposes. The Committee looks forward to future updates from the Agency regarding 

effective human resource planning, specifically on USAID’s Human 

Capital Strategy and its emphasis on developing a direct hire work 

force with a core competency of planning and implementing HIV/

AIDS programs with third party contractors.

PROCUREMENT

Because USAID seeks to accomplish U.S. foreign policy objectives 

via third party contractors and grant recipients, an effective procurement management system is integral to spending U.S. taxpayer resources wisely. The Committee finds it distressing that the 

agency does not possess a system that allows agency managers to 

track procurement activity worldwide to monitor the efficiency, 

fairness or competitiveness, and consistency with objectives across 

countries and regions. The opaque nature of the agency’s procureVerDate Sep 04 2002 01:55 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00038 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.003 HR663
39

ment process contributes to a lack of confidence in the agency’s 

ability to achieve its core development mission. The Committee 

strongly encourages current agency efforts to develop a worldwide 

procurement tracking system that allows the agency to regularly 

evaluate its procurement process and ultimately allow data to be 

integrated into its financial management system. The Committee 

notes that agency efforts are underway within the BTEC process 

to positively address challenges. The agency should be prepared to 

provide an assessment of problems, challenges, and proposed solutions associated with its planned worldwide system 60 days after 

enactment. 

An important component of USAID’s ongoing efforts to improve 

operations within its Office of Procurement is outreach to small, 

disadvantaged and minority contractors and grantees. The Committee is aware of the USAIDLINK initiative to train 100 minority 

firms in 10 leading export cities to better compete for USAID 

awards, and directs that $2,000,000 be allocated for the 

USAIDLINK program over the next two years. The Committee recommends that any contract for administration of USAIDLINK 

should be given to a private concern (or entity) that has previously 

directed a formal business linkage program to help minority and 

disadvantaged firms to increase international business by linking 

them with larger firms that do international business with a broad 

range of agencies. USAIDLINK will also implement and maintain 

a national database of qualified small, disadvantaged, and minority 

firms. Information in the database should be disseminated on a 

monthly basis to all USAID overseas missions, Washington, staff, 

and to all USAID prime contractors. 

USE OF PERSONAL SERVICE CONTRACTORS

The Committee notes the continued use by USAID of personal 

service contractors (PSCs). The Committee has traditionally supported this method of employing qualified individuals for short and 

medium term program implementation. 

The Committee again provides special authority for Washingtonbased personal service contractors in a general provision, section 

534(c). In this Act, the number and distribution of such exceptional 

PSC assignments has been reduced, and the Committee expects 

that the authority will be used primarily for Washington-based 

support for USAID activities in countries where new requirements 

are linked to the war against terrorism. As USAID has neglected 

to keep a core staff of engineers to supervise its increasing number 

of infrastructure projects, the Committee directs that priority emphasis be placed on hiring engineers to help draft contracts and 

monitor infrastructure projects, especially in Afghanistan and the 

Near East. 

The Committee also notes the trend toward employing PSCs over 

a period of many years at the Agency, who carry out functions 

similar to career personnel of the Civil Service and the Foreign 

Service, but who lack comparable health, retirement, and other 

benefits. The Committee requests USAID report in narrative form 

not later than March 1, 2003, on the total number of PSCs employed by the Agency, the average length of employment, the typical benefits provided to PSCs (compared to those provided to career Civil and Foreign Service employees), and the planned date for 

40

replacing these positions with direct hire personnel or to eliminate 

the PSC position. 

VOLUNTARY SEPARATION INCENTIVES

The Committee has included bill language providing for the payment of voluntary separation incentives to USAID employees for 

the purpose of eliminating positions and functions at AID. This 

provision further amends the fiscal year 2000 authority. The Agency is directed to consult with the Committee prior to announcing 

to AID employees the positions eligible for the separation incentives. The Committee expects this authority to be utilized to reduce 

employment levels in Washington, D.C., not at AID’s overseas missions. 

COMPUTERS

The Committee directs AID to continue to report on a quarterly 

basis on the status of its computer systems, including the cumulative costs associated with design and implementation of its computer systems. Any costs for computer systems above those originally justified for fiscal year 2003 shall be subject to prior review 

by the Committees on Appropriations. In addition, the Committee 

again directs that the Agency’s fiscal year 2004 budget justification 

clearly identify the amounts requested for AID computer operations. 

CAPITAL INVESTMENT FUND

Fiscal year 2002 level ......................................................................... ............................

Fiscal year 2003 request .................................................................... $95,000,000 

Committee recommendation .............................................................. 43,000,000 

The Committee is recommending $43,000,000 for the Capital Investment Fund for fiscal year 2003, $52,000,000 under the request. 

This is a new account that did not receive funds in fiscal year 2002.

The account is intended to provide the United States Agency for 

International Development with the funds for overseas construction 

and related costs, and for the procurement and enhancement of information technology and related capital investments. Funds would 

remain available until expended and are in addition to funds otherwise available for such purposes. Of the funds recommended above, $13,000,000, as requested, is 

intended for enhancements to the agency’s information technology systems. In addition, not to exceed $30,000,000 is available for construction of a new office building in Nairobi, Kenya. This building 

will provide secure space for USAID employees and contractors 

who are being forced to relocate due to the terrorist attack against 

the Nairobi Embassy on August 7, 1998. 

Due to the urgent need to protect USAID employees in Kenya as 

a result of terrorism, the Committee considers the Nairobi building 

to be a special case and withholds judgment as to the advisability 

of making a special exception for USAID from the policy that the 

Department of State should fund all overseas construction for consolidated embassy compounds. The Committee notes that only 

USAID is being asked to fund capital projects at new embassy compounds overseas; buildings and space for all other government 

agencies is appropriated through the State Department account for 

41

overseas construction. Therefore the Committee has not approved 

the funding requests for other USAID buildings that would be located on new embassy compounds and urges the Department of 

State to work with the Office of Management and Budget and 

USAID to resolve this policy in a fair and equitable manner. 

The Committee is recommending bill language that provides the 

Administrator of USAID with the authority to assess fair and reasonable rent for the use of space by other employees of the United 

States Government. Such rent shall be deposited into this account 

as an offsetting collection. In addition, the assignment of United 

States Government employees or contractors to space in buildings 

constructed using funds appropriated under this heading shall be 

subject to the concurrence of the Administrator of the United 

States Agency for International Development. The Committee believes that if USAID is being asked to fund its own building in 

Nairobi, it should be given the authority as landlord of that building. 

All funds made available under this account, including the obligation of offsetting collections, are subject to the regular notification procedures of the Committees on Appropriations. 

OPERATING EXPENSES OF THE UNITED STATES AGENCY FOR

INTERNATIONAL DEVELOPMENT, OFFICE OF THE INSPECTOR GENERAL

Fiscal year 2002 level ......................................................................... $31,500,000 

Fiscal year 2003 request .................................................................... 32,700,000 

Committee recommendation .............................................................. 33,700,000 

The Committee has recommended $33,700,000 for the Office of 

the Inspector General of USAID for fiscal year 2003, $1,000,000 

above the budget request and $2,200,000 above the fiscal year 2002 

level. The increase above the request is provided for audit activities 

relating to expanded assistance programs in Asia and the Near 

East region. The Committee commends the Inspector General for 

his cooperation with the Committee in its oversight of USAID management. 

OTHER BILATERAL ECONOMIC ASSISTANCE

ECONOMIC SUPPORT FUND

(INCLUDING TRANSFER OF FUNDS)

Fiscal year 2002 level ......................................................................... $2,199,000,000 

Emergency supplemental funding ..................................................... 465,000,000 

Fiscal year 2003 request .................................................................... 2,490,000,000 

Committee recommendation .............................................................. 2,445,000,000 

(by transfer) ................................................................................. (200,000,000) 

The Committee recommends a total of $2,445,000,000 for the 

Economic Support Fund, an amount that is $45,000,000 below the 

request and $219,000,000 below the amount enacted for fiscal year 

2002, including emergency supplemental appropriations. 

The Committee recommendation assumes a reduction of 

$160,000,000 in economic support for the Camp David countries. 

However, an additional $200,000,000 is provided Israel for anti-terrorism assistance. In addition, it reflects a reduction of $25,000,000 

associated with the decision to retain a separate appropriations account for the International Fund for Ireland. The Administration’s 

42

budget request included $25,000,000 for Ireland within the Economic Support Fund. The Committee recommendation also eliminates $20,000,000 associated with undefined policy initiatives. 

As requested by the President, the Committee is recommending 

the continuation of language similar to that contained in the fiscal 

year 2002 appropriations act that authorizes assistance to the National Democratic Alliance of Sudan for certain specified activities. 

The Committee is also recommending the retention of language 

from the fiscal year 2002 appropriations act specifying that policy 

and allocation decisions for funds appropriated under this heading 

in this Act and in prior acts shall be made by the Secretary of 

State or the Deputy Secretary of State and shall not be delegated. 

The Committee is concerned the programs and activities funded 

through this account accurately reflect both the priorities of the 

Secretary of State and the budget justification material provided to 

the Committees on Appropriations, as modified by the Congress. 

The managers reiterate the importance of Congressional intent in 

the programming of funds appropriated to the Economic Support 

Fund, and anticipate the continuation of a cooperative approach 

during fiscal year 2003 on funding allocations and programming 

decisions. 

ISRAEL

The Committee is continuing the initiative begun five years ago 

for a phased reduction in economic assistance for Israel that will 

result in the eventual elimination of ‘‘Economic Support Fund’’ assistance. This proposal was originally made by the Government of 

Israel in response to new economic realities in the Middle East. 

The Committee is also convinced that the emerging security 

threats in the Middle East are significant and warrant increasing 

military assistance to Israel by $60,000,000 in fiscal year 2003. The Committee therefore recommends not less than $600,000,000 

in economic support shall be provided for Israel, which is 

$120,000,000 less than the fiscal year 2002 level and the same as 

the President’s budget request. The Committee also requires in bill 

language that these funds be provided to Israel as a cash grant and 

that funds be disbursed within 30 days of enactment or by October 

31, 2002, whichever is later. 

The Committee recommendation also includes the President’s request for an additional $200,000,000 for Israel, all or a portion of 

which may be transferred to, and merged with, funds appropriated 

by this Act under the heading ‘‘Nonproliferation, Anti-Terrorism, 

Demining and Related Programs’’ for defensive, non-lethal anti-terrorism assistance in accordance with the provisions of chapter 8 of 

part II of the Foreign Assistance Act of 1961. The bill language on 

this matter is the same as that contained in the contingent emergency appropriation for assistance for Israel in Public Law 107–

206. 

The Committee has retained an overall limit on Middle East 

spending (section 555) at a level of $5,466,700,000. The change 

from the fiscal year 2002 ceiling represents the net result of a decrease of $160,000,000 in economic support for the Camp David 

countries and an increase of $260,000,000 in military and anti-terrorism assistance for Israel, as well as increases for other activities 

in the region in order to support our allies in the war on terrorism. 

43

EGYPT

As part of the Committee’s ongoing review of Middle East aid 

levels, and as a result of budget constraints affecting the international affairs budget, the Committee is recommending continuation of a policy of reducing economic support for Egypt in a manner which does not inadvertently undermine the guiding principles 

of the Camp David Accords. 

The Committee therefore includes not less than $615,000,000 in 

economic support be provided for Egypt on a grant basis, which is 

$40,000,000 less than the fiscal year 2002 level and the same as 

the President’s budget request. A cash transfer may be provided 

with the understanding that Egypt will continue to implement significant economic reforms. 

The Committee notes that language included in the statement of 

the managers on the conference report accompanying H.R. 2506 

(House Report No. 107–345, page 66) stated explicitly the Congressional expectation that an immediate review be conducted of basic 

education programs in countries whose assistance is primarily provided from the Economic Support Fund. Specifically, the language 

encourages cooperative efforts to be initiated with ESF-recipient 

countries to develop and implement creative basic education programs that strengthen the capacity and accessibility of public education systems. The Committee is disappointed by the response of 

the Administration to this recommendation as it applies to Egypt. 

The Committee notes that the recently-released United Nations 

Development Programme publication on development in the Arab 

world specifically points to a ‘‘human capabilities/knowledge deficit 

relative to income’’ which hinders development and which can be 

redressed, in part, through basic education. The Committee believes Egypt would benefit from an increased focus on this objective, and urges the State Department to consider the Committee’s 

recommendation as it reviews the United States assistance program for Egypt. The Committee also directs the Department of 

State to submit a report to the Committees on Appropriations on 

the results of its review of the Egypt program, including recommendations for changes to the program, by March 1, 2003. 

CAMP DAVID ACCORDS

The Committee emphasizes once again that the recommended 

levels of assistance for Israel and Egypt are based in great measure 

upon their continued participation in the Camp David Accords and 

the Egyptian-Israeli peace process. 

NON-MILITARY EXPORTS

The Committee strongly urges the President to ensure, in providing cash transfer assistance to Egypt and Israel, that the level 

of such assistance does not cause an adverse impact on the total 

level of non-military exports from the United States to each such 

country. 

ECONOMIC BOYCOTT OF ISRAEL

The Committee has once again included language in the bill addressing the Arab League boycott of Israel under section 535 of this 

44

Act. This language includes modifications made two years ago to 

urge that Arab League members normalize relations with Israel. 

WEST BANK AND GAZA PROGRAM

The Committee recommendation for the West Bank and Gaza 

program includes a continuation of language that prohibits funds 

in this Act from being obligated or expended for the Palestinian 

Authority (section 552). In addition, the Committee is concerned 

that funds for this program be provided in conformance with existing law and regulation, and that no funds be provided inadvertently to entities or individuals that advocate, plan, sponsor, engage 

in, or have engaged in, terrorist activity. Therefore the Committee 

recommendation includes a modification to section 563 that requires the Secretary of State to take all appropriate steps to ensure 

that assistance is not provided to such entities or individuals. 

In addition, in order to maintain proper oversight of grants and 

contracts issued under the West Bank and Gaza program, the Committee is recommending bill language requiring annual audits of all 

contractors and grantees, and significant subcontractors and subgrantees. Up to $1,000,000 is authorized to be made available to 

the Inspector General of the United States Agency for International 

Development for audits, inspections, and other activities in furtherance of this provision. 

The Committee acknowledges that one of the primary objectives 

of the West Bank and Gaza program is to create viable infrastructure in Palestinian Authority-controlled areas to ensure the health 

and welfare of the Palestinian people. Al Quds University, in cooperation with the Kuvin Center for Infectious Diseases of the Hebrew University of Jerusalem, has proposed the establishment of a 

regional health and disease program, which would work to build an 

effective infrastructure to deal with serious health and disease 

problems among the Palestinian people. The Committee understands that cooperative programs of this nature are rare in the current environment, and urges AID to work, through the West Bank 

and Gaza program, to help Al Quds and the Kuvin Center begin 

this initiative. 

JORDAN

The Committee expresses its continued strong support for and 

appreciation of Jordan’s constructive and critical role in the region 

and encourages the Administration, in close consultation and cooperation with the Congress, to continue its efforts to assist Jordan 

in both the economic and security areas. The Committee therefore 

recommends $250,000,000 in economic assistance for Jordan, the 

same as the President’s budget request. 

Within the funds allocated for Jordan under this heading, the 

Committee urges AID to provide $350,000 for a feasibility study for 

the creation of an American University in Amman and/or Aqaba. 

This feasibility study would include the development of plans for 

the project; a study of the design and operation of other American 

universities; an identification and evaluation of potential American 

university partners; and an examination of possible sources of ongoing funding for the construction and operation of the university. 

45

LEBANON FUNDING

The Committee believes support for the people of Lebanon continues to be in the United States national interest. The Committee 

supports $35,000,000 for assistance for Lebanon for fiscal year 

2003. In that regard, the Committee has retained bill language 

similar to that contained in the fiscal year 2002 appropriations act 

that directs that not less than $35,000,000 should be made available for Lebanon. Working through such organizations as the 

Young Men’s Christian Association (YMCA), the Catholic Near 

East Welfare Association, the Cooperative Housing Foundation, 

Mercy Corps, Save the Children Federation, State University of 

New York, and the World Rehabilitation Fund, the Agency for 

International Development is providing the basis for a democratic 

social and economic infrastructure that does not rely on other organizations operating in that country. In particular, the Committee 

commends the Rural Community Development Cluster (RCDC) program, which is helping to revitalize and expand economic opportunities in some of the most destitute and poverty-stricken areas of 

Lebanon. 

The Committee is also aware of the key role the Lebanese American University, American University of Beirut, and International 

College play training leaders in the region and urges that at least 

the fiscal year 2002 allocation be provided for these important institutions. 

The Committee recognizes that Lebanon can never achieve full 

independence until all foreign security and military forces are withdrawn, and control is reasserted by the national government 

throughout all of Lebanon, including the south. As it did last year, 

the Committee calls upon Lebanon and Syria to adopt a timetable 

for the complete withdrawal of all Syrian forces from Lebanon. 

MIDDLE EAST REGIONAL PROGRAMS

The Committee continues to be concerned about issues related to 

water allocation in the Middle East. Since the start of peace negotiations in the region, this has been one of the most critical issues 

to resolve, and, given the reality of supply and demand, it is not 

expected to diminish in importance. 

Therefore the Committee strongly supports the continued efforts 

of the International Arid Lands Consortium in addressing the critical issues of water, energy, and agriculture and land use in the 

Middle East and Central Asia, and directs AID to make available 

up to $2,500,000 to the Consortium for this work. These funds are 

to be allocated from bilateral, centrally managed or regional programs either in this account or in other accounts funded by this 

Act. 

In addition, the Committee continues to urge AID to provide assistance to the Blaustein Institute for Desert Research to investigate the flow and transport of pollutants in groundwater. 

SUPPORT FOR IRAQ DEMOCRATIC OPPOSITION

The Committee includes $25,000,000, as requested, for support of 

the democratic opposition in Iraq. Using funds appropriated for 

this activity, the Committee urges support for the Universities of 

Dohuk, Irbil, and Suleimani in the Kurdish region in Northern Iraq 

46

for the purpose of funding education programs, including infrastructure and equipment as appropriate, in order to promote programs in civil society, the rule of law, and democratic institution 

building. Representatives of Kurdish groups from the region have 

jointly requested $10,000,000 for this purpose. The Committee 

urges the Department of State to work with these groups to establish a viable funding level for these activities. 

The Committee notes that for several years the Department of 

State has made funds available for the United Nations guard program in Northern Iraq using section 451 of the Foreign Assistance 

Act. The Committee no longer considers support for this activity to 

be an unanticipated contingency and directs that any future funding needs be met through the reprogramming of funds intended for 

the Iraq democratic opposition.

EAST TIMOR

The Committee recommends that $25,000,000 from the Economic 

Support Fund be made available to support income producing 

projects and other reconstruction activities in East Timor. 

MONGOLIA

The Committee supports the Administration’s $12,000,000 request for assistance for Mongolia for fiscal year 2003. 

TIBET

The Committee recommends that $250,000 be made available 

through a nongovernmental organization, such as the National Endowment for Democracy, for the purpose of providing training and 

education of Tibetans in democracy activities, and monitoring the 

human rights situation in Tibet. In addition, language has been included in section 526 to allow for $3,000,000,000 in funding for activities that preserve cultural traditions and promote sustainable 

development and environmental conservation in Tibetan communities. 

The Committee is aware of the valuable assistance the Bridge 

Fund has provided to promote Tibetan-owned and operated businesses and educational, cultural, and natural resource conservation 

projects in Tibet, and urges that funds be provided for these activities. 

CYPRUS

The Committee strongly supports the budget request of $15,000,000 for educational and other bicommunal projects in Cyprus, and recommends language similar to that included in the fiscal year 2002 act that provides that not less than $15,000,000 

should be made available for these purposes. These funds provide 

a basis for mutual cooperation and preparation for the two communities of Cyprus to live together harmoniously by increasing intercommunal contacts. 

LATIN AMERICA AND THE CARIBBEAN

The Committee fully supports the budget request of $6,000,000 

for the Cuba democracy program and its goal of promoting a peaceful transition to democracy in that country. When allocating these 

47

funds the Committee expects AID to consider proposals at or 

through institutions of higher education in the United States and 

expects that competitive procedures will be followed with regard to 

such proposals. 

The Committee continues to be concerned about the resolution of 

the cases involving the terrorist bombings of the Israeli Embassy 

and the AMIA Jewish Community Center in Buenos Aires, Argentina. It is disturbed by recent allegations regarding the role of Iran 

in these acts, and by possible collusion with former members of the 

Government of Argentina. The Committee urges the Secretary of 

State to continue to work with the Government of Argentina to ensure that progress is made in these cases, and to offer technical 

law enforcement assistance where appropriate to bring to justice 

the perpetrators of these terrorist acts. 

HUMAN RIGHTS AND DEMOCRACY FUND

As in fiscal years 2001, 2002, and 2003 the Committee urges 

that, of the funds allocated to the Human Rights and Democracy 

Fund, $1,000,000 should be provided to support the Reagan/Fascell 

Democracy Fellows Program of the National Endowment for Democracy to enable activists, scholars, journalists, and practitioners 

from around the world to help make contributions to the strengthening of democracy in their respective countries. This program was 

authorized in section 104(a)(2)(B) of H.R. 3427 as enacted into law 

as part of Public Law 106–113. If insufficient funds are available 

within the Human Rights and Democracy Fund, another funding 

source within the Economic Support Fund should be identified by 

the Department of State. However, the Committee requests that 

the Department of State report within 60 days of enactment on the 

allocation of the $1,000,000 for this important program. 

The Committee also strongly recommends that $1,000,000 be 

made available in fiscal year 2003, as in fiscal year 2002, for democracy programs in China through the National Endowment for 

Democracy (NED). Additional funding for worldwide democracy activities through the NED should be allocated at the fiscal year 2002 

level from the Human Rights and Democracy Fund with the expectation that the budget request for the Fund will be increased to accommodate these programs. If the Fund budget is not increased 

commensurate with the needs for these programs, ongoing support 

for these worldwide democracy activities (exclusive of $1,000,000 in 

funding for the China democracy programs and $1,000,000 for the 

Reagan/Fascell Democracy Fellows Program) should be allocated 

from other appropriate sources within the Economic Support Fund. 

Due to the delay in allocating and programming these funds in fiscal year 2002, the Committee directs that the State Department report no later than December 15, 2002, on its plans for implementing the intention of Congress as expressed in this paragraph. 

TUNA TREATY

The Treaty on Fisheries between the United States and the governments of certain Pacific Island states, popularly known as the 

South Pacific Regional Fisheries Treaty, requires that economic assistance be provided annually to the South Pacific states. Therefore, the Committee recommends that the treaty obligation be met 

48

through the payment of the full $18,000,000 in fiscal year 2003, as 

requested by the President. 

CONFLICT RESOLUTION

The Committee recognizes the importance of youth training in 

conflict resolution as a tool for creating a climate of peace in regions of conflict. The Committee commends Seeds of Peace for its 

commitment to helping future leaders of the Middle East and other 

regions (such as Cyprus, the Balkans, and South Asia) to overcome 

prejudice, fear, and other obstacles to peace, and urges AID and 

the Department of State to provide $1,000,000 in fiscal year 2003 

to support the important work of this organization. 

The Committee is disappointed that central funding has not been 

made available for the School for International Training’s Conflict 

Transformation Across Cultures (CONTACT) program, as the Committee recommended in last year’s report and in the statement of 

the managers accompanying the conference report on the fiscal 

year 2002 appropriations act. This program has trained people 

from Cyprus and the Balkans to Sri Lanka in the core skills and 

practical tools for responding to conflict in their communities. The 

Committee urges the Africa and South Asia bureaus at the Department of State to take greater advantage of this program. The Administrator of USAID, in consultation with the Bureau of Democracy, Conflict, and Humanitarian Assistance, is requested to report 

to the Committee not less than 80 days after the enactment of this 

Act on USAID’s proposed core support for the CONTACT program. 

The Committee reiterates that $1,000,000 should be made available, overall, over fiscal years 2003 and 2004. 

The Committee supports the work of the Jerusalem International 

YMCA, which brings together Christian, Jewish and Muslim young 

people in a positive environment that promotes peace, respect, and 

understanding, and recommends that funds be provided for its 

work.

The Committee recognizes the Foundation for Environmental Security and Sustainability’s important contribution to United States 

national security interests. A public foundation working directly 

with the national security and civil communities, the Foundation 

focuses on practical actions in foreign countries to mitigate potentially destabilizing environmental and natural resource threats. 

The Foundation’s work provided the United States and the international policy community’s critical opportunities to mitigate problems before they become crises, and better prepare for crises that 

cannot be avoided. The conflict prevention focus of the Foundation 

provides critical input for USAID, the Department of Defense, and 

other Federal agencies in prioritizing areas for engagement and 

technical assistance and implementing focused and effective conflict prevention programs that are more critical than ever in the 

light of the events of September 11, 2001. 

The Committee believes that the International Crisis Group 

(ICG) provides the high-quality analysis and policy recommendations that can help prevent and reduce the level of deadly violence 

resulting from complex crises, and strongly recommends that the 

Department of State and USAID provide funding for the ICG to 

continue its research in areas of U.S. foreign policy interest. 

49

BURMA

The Committee notes the apparent changes underway in Burma, 

especially the release of its democratically elected leader from 

house arrest. It encourages the United States Government and the 

United Nations to continue their efforts to promote greater political 

and economic space within Burma for pro-democracy and pro-economic growth elements. The effects of Government violence against 

Burmese minorities, including forced displacement, laying of landmines, and systematic rape by regime soliders, and the collapse of 

much rural infrastructure in Burman-majority areas are compounded by rapid environmental degradation in much of Burma. 

The Committee is aware of reports that many Burmese are severely malnourished and that famine conditions are possible in the 

near future, and requests that USAID evaluate the food security 

situation in Burma. 

In order to help promote an orderly transition within Burma, 

which must include meaningful participation by Burmese minorities both inside and outside of the country, the Committee has included a general provision, section 578, providing that not less than 

$8,500,000 from the Economic Support Fund and $2,000,000 from 

the Child Survival and Health Programs Fund should be made 

available for activities within Burma and among Burmese who 

have fled to neighboring countries, especially Thailand. It is the 

Committee’s intent that current programs that largely serve minority groups within and without Burma continue as increased resources are directed within Burma to benefit a broad range of Burman groups. None of the funds may be used to directly benefit the 

unelected central Government. 

AVAILABILITY OF FUNDS

The Committee has continued language that funds in this account are to remain available for obligation for two years. 

INTERNATIONAL FUND FOR IRELAND

Fiscal year 2002 level ......................................................................... $25,000,000 

Fiscal year 2003 request .................................................................... (25,000,000) 

Committee recommendation .............................................................. 25,000,000

The Committee recommends $25,000,000 for the International 

Fund for Ireland in support of the Anglo-Irish Accord. Funding for 

this activity is requested through the Economic Support Fund, but 

the Committee recommendation would continue a separate account 

for assistance to Ireland. The amount recommended is the same as 

the President’s budget request and the fiscal year 2002 level. 

The Committee strongly urges the International Fund for Ireland 

to take every step possible to ensure that all recipients of Fund 

support are promoting equality of opportunity and non-discrimination in employment. The Committee further urges the Fund to 

focus on those projects that hold the greatest potential for job creation and equal opportunity for the Irish people, regardless of class, 

creed, gender, or ethnicity. 

The Committee encourages the International Fund for Ireland to 

favorably consider requests to fund training for the new police service of Northern Ireland, in cooperation with other donors. 

50

ASSISTANCE FOR EASTERN EUROPE AND THE BALTIC STATES

Fiscal year 2002 level ......................................................................... $621,000,000 

Fiscal year 2003 request .................................................................... 495,000,000 

Committee recommendation .............................................................. 520,000,000

The Committee recommends $520,000,000 for Assistance for 

Eastern Europe and the Baltic States, an amount that is 

$101,000,000 below the level provided in fiscal year 2002, but 

$25,000,000 above the budget request. The increase above the 

budget request is intended for additional assistance for Montenegro, the Baltic States, Croatia, and regional efforts to solidify 

democratic gains through the National Endowment for Democracy 

and other institutions.

The Committee intends that funding for democracy programs 

though the National Endowment for Democracy continue at the fiscal year 2002 level, and be provided as a transfer of funds pursuant 

to section 632(a) of the Foreign Assistance Act. Funds have been 

provided above the budget request to allow for continued support 

for these activities. 

KOSOVO

The Committee has retained language from fiscal year 2002 requiring that the United States should not provide more than 15 

percent of the resources pledged for Kosovo. In addition, bill language is continued from the fiscal year 2002 appropriations act 

that would prohibit funding for large scale physical infrastructure 

reconstruction. 

BOSNIA AND HERZEGOVINA

The Committee has recommended the same bill language as in 

the fiscal year 2002 Act that requires the written approval of the 

Administrator of AID for loans and projects under the Economic 

Reconstruction Program For Bosnia; authorizes the use of local currency funds generated by the Bosnia assistance program for programs throughout the region; and authorizes the President to withhold funds for economic revitalization for Bosnia if he determines 

that Bosnia is not in compliance with the Dayton Accord regarding 

the presence of foreign forces and has not terminated intelligence 

cooperation with Iranian officials. All funds are subject to the provisions of section 529 of this Act. 

SERBIA

The Committee is aware that the Clinical Center of Serbia is in 

immediate need of medical equipment to deal with the dramatic increase in recent years of the incidence of cancer in Yugoslavia. This 

center and an associated institute are public, non-profit organizations located in Belgrade. The Committee urges USAID and the 

Department of State to assist the center using funds appropriated 

under this heading or made available elsewhere in title II of this 

Act. 

MONTENEGRO

The Committee strongly supports assistance for the Republic of 

Montenegro, and urges the Administration to make every effort to 

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ommendation includes funding above the President’s request for 

this account in order to provide Montenegro with an allocation of 

$40,000,000, rather than $25,000,000. The Committee notes the 

strong support given by the Republic to the foreign policy of the 

United States during the latter years of the Milosovic regime in 

Serbia. 

THE BALTIC STATES

The Committee has included bill language directing that 

$5,000,000 should be provided for assistance for the Baltic States. 

The Committee strongly supports continued assistance to the Baltic 

States. Although these countries no longer have AID missions, they 

are still emerging from decades of dominance by the Soviet Union 

and continue to need United States technical assistance in order to 

emerge into the community of Western nations. 

The Committee intends that these resources be used for trade 

and economic reform programs, environment programs, health programs, anticrime and anticorruption programs, and rule of law programs. The majority of the funds should be programmed through 

the Agency for International Development. 

The Committee requests that the Department of State and the 

Agency for International Development consult with the Committees 

on Appropriations by February 1, 2003, on plans to implement 

these programs in the Baltic States. The Committee does not believe the maintenance of such programs will require AID to open 

missions in any of these countries. Such programs can and should 

be managed on a regional basis. 

TREATMENT OF ORPHANS

The Committee continues to be very concerned by the condition 

of orphaned children in the Federation of Bosnia and Herzegovina. 

While Bosnian families have been reluctant to adopt many of these 

children, American families have shown an interest in adopting 

Bosnian children. Unfortunately, legislative barriers within the 

Federation have prevented foreign adoptions, and the Committee is 

very disturbed that little action has been taken to modify these 

provisions. The Committee strongly encourages the Government of 

the Federation of Bosnia and Herzegovina to enact legislation that 

will expedite the adoption of Bosnia children by foreign families, 

and directs the Secretary of State to report not later than December 1, 2002, on the steps that have been taken both by Bosnia and 

by the Department to encourage passage of such legislation. The 

Committee also expects the continuation of the orphans program in 

Bosnia funded in the fiscal year 2002 appropriations act. 

LEGAL INITIATIVES AND THE RULE OF LAW

The Committee encourages the Agency for International Development to continue to provide financial support for the Central and 

Eastern European Law Initiative (CEELI), a project of the American Bar Association. CEELI has received grants to help Central 

and East Europe and the NIS create new legal frameworks based 

on the rule of law rather than through party doctrine or caprice. 

Through a variety of program components, CEELI is making 

available legal expertise to assist countries that are in the process 

52

of modifying or restructuring their laws or legal systems. CEELI 

emphasizes long-term engagement country-by-country and supports 

projects that facilitate extensive consultations with policy-makers, 

legal scholars, judges, and attorneys. CEELI has focused work in 

several critical priority areas: constitutional reform; judicial restructuring; bar reform; commercial law; criminal law and procedure; and legal education reform, and has helped develop and/or institutionalize self-sustaining indigenous nongovernmental organizations (NGOs). The Committee encourages support for this type of 

private sector involvement. 

The Committee strongly supports the USAID-funded program for 

distance learning legal education that has been initiated in the 

Central and East European region, and recommends funding for 

the program in fiscal year 2003 at the level provided in fiscal year 

2002. 

TRAINING AND EXCHANGES IN THE FORMER SOVIET UNION AND

CENTRAL EUROPE

The Committee continues to support training, exchanges, and 

partnerships between the United States and the nations of Eurasia, Central Europe, and the southern tier of Europe. These programs are in the interest of the United States and important to 

sustaining democracies. The Committee strongly recommends the 

Administration provide funding for the Russian, Eurasian, and 

East European Research and Training Program (Title VIII) at the 

fiscal year 2002 level. 

The Committee continues to support the East Central European 

Scholarship Program (ECESP) and its important work. The Committee recommends the East Central European Scholarship Program be continued at the same level as in fiscal year 2002. It also 

expects USAID to continue funding ECESP on a basis that allows 

the program to operate effectively in the outyears. In addition, the 

Committee believes that the experience of ECESP might be well 

suited for several of the New Independent States of the Former Soviet Union.

ASSISTANCE FOR THE INDEPENDENT STATES OF THE FORMER SOVIET

UNION

Fiscal year 2002 level ......................................................................... $784,000,000 

Emergency appropriations ................................................................. 110,000,000 

Fiscal year 2003 request .................................................................... 755,000,000 

Committee recommendation .............................................................. 755,000,000

The Committee recommends $755,000,000 for Ukraine, the 

Southern Caucasus states, Russia, and the Central Asian republics 

of the former Soviet Union. This is the same as the request and 

$29,000,000 less than the enacted fiscal year 2002 level including 

emergency supplemental funding.

The Committee has included in subsection (a) prior year language providing the funds under this heading ‘‘notwithstanding 

any other provision of law’’ and applying the provisions of section 

498B(j) of the Foreign Assistance Act. A general provision (section 

517) also includes long-standing language on human rights, and 

non-use of funds for enhancing military capacities, and providing 

all funds subject to separate notification. 

53

The Committee recommendation includes a new paragraph (h) 

under this heading. It contains language regarding Uzbekistan 

identical to that carried under the heading ‘‘Foreign Military Financing Program’’ in Public Law 107–206. This language provides 

that funds made available by this Act for assistance for the Government of Uzbekistan may be made available if the Secretary of 

State determines and reports to the Committees on Appropriations 

that the Government of Uzbekistan is making substantial and continuing progress in meeting its commitments under the ‘‘Declaration on The Strategic Partnership and Cooperation Framework Between the Republic of Uzbekistan and the United States of America’’. 

CHILD SURVIVAL AND HEALTH

The Committee continues to be concerned about the low priority 

assigned to declining maternal and environmental health conditions and the increasing incidence of TB/HIV/AIDS in Russia, 

Ukraine, and the Central Asian Republics. The positive results 

achieved with the small amounts already spent for such programs 

in recent years have been dramatic. The health and child survival 

sector can effectively absorb increased resources, with an immediate and personal impact on the demographically-stressed citizens 

of these nations. In order to demonstrate its support for these high 

priority activities that directly affect the citizens of these countries, 

the Committee has included bill language allocating not less than 

$60,000,000 for them, including basic education. 

The Committee is aware of and commends the Birth Defects 

Monitoring Program recently instituted in Ukraine to detect the incidence of birth defects related to the Chernobyl accident. The 

Committee recommends that funds be provided for this purpose 

and a proposed program to fortify flour with folic acid to reduce the 

occurrence of spina bifida in Ukraine in fiscal year 2003. The Committee also commends AID for its efforts to prevent the trafficking 

of young women from the region and expects successful programs 

to be expanded. The Primary Health Care Initiative of the World 

Council of Hellenes, has come to the attention of the Committee. 

Funded by the Coordinator’s Office of Humanitarian Assistance in 

prior years, this project merits consideration, based on its success, 

for $3,000,000 in 2003. 

The Committee recognizes the work of the Eurasian Medical 

Education Program of the American College of Physicians in continuing medical education of Russian physicians in the treatment 

of tuberculosis, cardiovascular disease, and diabetes. This exchange 

program has given volunteer American physicians the opportunity 

to share experiences and knowledge with their Russian colleagues, 

greatly benefiting the people of the Russian Federation. The Committee urges continued AID support for this program.

INTERNATIONAL AND COMMUNITY PARTNERSHIPS IN EURASIA

The Committee recognizes that the effectiveness of efforts to promote good government and democracy are dependent on continuing 

USAID support for independent programs that pair U.S. cities with 

cities in the countries of the former Soviet Union. 

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nomic development at the local level. The Committee again urges 

USAID to expand its direct support for these valuable programs, 

without requiring them to dilute their unique community-linkages 

that have been built over several years. In Russia, the Committee 

has been made aware of the Future of Russia initiative to build a 

modern birthing clinic and remodel the maternity clinic at 

Balashikha, Russia, and requests that USAID give serious consideration to a proposal by this organization for participation in 

USAID’s Russian health program. 

An example is the Arizona-Kazakhstan Partnership Foundation, 

which began as a Tuscon-Almaty sister city relationship in 1989 

and now includes as many as five sub-partnerships, ranging from 

the Tuscon Chamber of Commerce to the League of Women Voters 

and United Way. Identified by AID as one of its key partnerships, 

the Committee supports the continuation, and, if feasible, the expansion of this and similar regional programs. 

The Committee encourages the Office of the State Department 

Coordinator for Eastern Europe and Former Soviet Union to recognize the importance of strengthening the capacity of organizations 

such as Sister Cities International (SCI). The Committee further 

recognizes that a very modest investment in the organizational capacity of SCI will leverage hundreds of thousands of dollars in nonfederal community resources that will be used to support community based humanitarian relief, economic development partnerships, and international exchanges. In response to the events of 

September 11th, SCI has embarked on a multiyear plan to double 

the number of partnerships that target underserved regions of the 

world. To this end the Committee urges the Coordinator to contribute an additional $164,000 in core funding to SCI in addition 

to support that the organization may receive through others grants. 

RUSSIA-IRAN

The Committee again recommends language dealing with Russian nuclear and ballistic missile cooperation with Iran. The language is identical with that contained in existing law. The Committee remains extremely disturbed by reports which indicate that 

Russian entities are extensively engaged with Iran in cooperative 

projects that significantly enhance Iran’s ballistic missile capabilities. The ballistic missile cooperation, combined with Russian nuclear cooperation with Iran, represent a significant step in Iran’s 

efforts to obtain a comprehensive, highly sophisticated weapons of 

mass destruction capability. The Committee reiterates the language from the fiscal year 2000 Statement of the Managers ‘‘that 

assistance to combat infectious diseases, child survival and nonproliferation activities, support for regional and municipal governments, and partnerships between United States hospitals, universities, judicial training institutions and environmental organizations and counterparts in Russia should not be affected by this section.’’

UKRAINE-IRAQ

The Committee is extremely concerned about continuing reports 

that Ukraine has been involved in arms transfers to Iraq. This is 

particularly disturbing given the possibility that United States 

troops may soon be engaged in combat against the military of Iraq. 

55

Indeed, Iraq has intensified efforts to destroy military aircraft of 

the United States and its coalition allies involved in maintaining 

the ‘‘no fly’’ zones over northern and southern areas of that country. Therefore the Committee is recommending language that prohibits assistance for the Government of Ukraine unless the Secretary of State determines and certifies to the Committees on Appropriations that, since September 11, 2001, the Government of 

Ukraine has not facilitated or engaged in arms sales or arms transfers to Iraq. This restriction shall not apply to assistance to combat 

infectious diseases or assistance for victims of trafficking in persons, and to nonproliferation and disarmament activities authorized under title V of the FREEDOM Support Act. The Committee 

notes that assistance for the first activity does not require a specific exemption in bill language in this case, but has included it for 

clarity. 

AGRICULTURE IN UKRAINE

The Committee is aware of joint efforts by the Departments of 

State and Agriculture and USAID to develop a United States Government agricultural strategy framework for Ukraine. The development of agriculture production, processing and marketing by small 

landholders holds great promise for Ukraine and the region. Additionally, the Committee encourages USAID to develop in cooperation with the Department of Agriculture a program similar to the 

effective Marketing Assistance Program that has been underway in 

Armenia for the past several years. 

SOUTHERN CAUCASUS REGION: NAGORNO-KARABAKH

The Committee continues to be concerned about the plight of the 

victims of the Nagorno-Karabakh conflict, and expects that the remainder of the $20,000,000 in humanitarian assistance, initially 

provided in the fiscal year 1998 Act, will be promptly disbursed. In 

the event the these funds are obligated and expended before the 

end of fiscal year 2003, up to $5,000,000 should be made available 

to address ongoing humanitarian needs in Nagorno-Karabakh. 

SUPPORT OF PEACEFUL RESOLUTION OF SOUTH CAUCASUS CONFLICTS

The Committee reiterates themes included in its last four reports: 

The extent and timing of United States and multilateral assistance, other than humanitarian assistance, to the government of 

any country in the Caucasus region should be proportional to its 

willingness to cooperate with the Minsk Group and other efforts to 

resolve regional conflicts. 

In furtherance of a peaceful resolution to the Nagorno-Karabagh 

conflict, and in support of the confidence building measures discussed at NATO and OSCE summits, the Committee strongly supports confidence-building measures among the parties to the conflict. Such measures include strengthening compliance with the 

cease-fire, studying post-conflict regional development such as 

landmine removal, water management, transportation routes and 

infrastructure, establishing a youth exchange program and other 

collaborative and humanitarian initiatives to foster greater understanding among the parties and reduce hostilities. 

56

The Committee has included renewed authority for the President 

to provide humanitarian assistance to the region, notwithstanding 

the restrictions of section 907 of the FREEDOM Support Act. The 

bill language is unchanged from last year. This exemption allows 

for direct assistance by American NGOs to refugees and displaced 

persons throughout the region, including those in NagornoKarabagh. The Committee understands that humanitarian assistance may include a broad range of activities and partnerships with 

United States hospitals and universities in maternal and children’s 

health, eldercare, basic education and environmental health. 

ARMENIA

The Committee recommends that $83,433,000 be made available 

from funding sources in this title for Armenia. This is $9,500,000 

above the request. The Committee is aware that economic recovery 

is dependent upon the growth of small- and medium-sized businesses in Armenia, and recommends that this sector, including investment funds, be given priority by USAID. 

GEORGIA

The Committee recommends that $82,500,000 be made available 

from funding sources in this title for the Republic of Georgia. This 

is $6,792,000 less than the request. The Committee intends that a 

significant part of the assistance for Georgia continue to be provided for technical security assistance for border and export control. 

EXPANDED THREAT REDUCTION

The Committee includes $15,000,000 for the bilateral U.S. Civilian Research and Development Foundation (CRDF) in this account, 

and not less than the request of $15,000,000 for the Georgia Border 

Security and Related Law Enforcement Assistance Program. 

The Committee recommends that of the amounts provided for 

ETR activities, up to $2,000,000 be made available for collaborative 

research grants for American and Russian scholars concerning the 

enhancement of verification of arms control and nonproliferation 

agreements, confidence-building measures to enhance international 

security, and economic and political studies of defense conversion. 

VIOLENCE AGAINST WOMEN

The Committee continues to be very concerned about the incidence of violence against women in Russia, Ukraine, and Central 

Asia and the indifference of many law enforcement officials to such 

crimes. Funds should be made available to improve the response of 

Russia’s and Central Asia’s law enforcement and judicial system to 

women victims of violence. 

DEMOCRACY PROGRAMS

Given the increasing repression of the fledgling institutions of 

civil society and general reversal of progress towards democracy in 

the Russian Federation and Ukraine, $4,000,000 should be made 

available through the National Endowment for Democracy and its 

subgrantees to assist nongovernmental organizations (NGO’s). 

Such funding should be made available pursuant to section 632(a) 

57

of the Foreign Assistance Act. Special emphasis should be given to 

programs promoting human rights, freedom of information, market 

reform, rule of law, political party development, freedom of association and NGO development. Attention should be devoted to programs outside of the capital cities and to cross-border programs 

that promote the exchange of experience and information among 

the countries of Central and Eastern Europe, Russia and Ukraine. 

RELIGIOUS FREEDOM IN RUSSIA

The Committee continues to be concerned about the dire consequences to several religious groups resulting from regional enforcement of the religious freedom statute in the Russian Federation. Recently, federal denial of visas for long-time resident church 

leaders threatens to further restrict religious freedom in the Russian Federation. 

The bill again includes language addressing this matter that is 

identical to language in prior years Acts. 

The Committee does not intend that the limitation on assistance 

to the Government of the Russian Federation limit assistance for 

regional and municipal governments or partnerships between 

United States hospitals and universities and counterpart institutions in Russia. 

UNITED STATES RUSSIA INVESTMENT FUND

The Committee remains concerned that funding allocations from 

this account for the U.S. Russia Investment Fund have not been 

adequate, if the Fund is to achieve its objectives. The Committee 

urges the Coordinator of Assistance to Europe and Eurasia to work 

with USAID and the Overseas Private Investment Corporation to 

assist the Fund to become adequately capitalized as soon as feasible. 

INDEPENDENT AGENCIES

INTER-AMERICAN FOUNDATION

Fiscal year 2002 level ......................................................................... $13,107,000 

Fiscal year 2003 request .................................................................... 14,000,000 

Committee recommendation .............................................................. 16,000,000 

The Committee recommends $16,000,000 for the Inter-American 

Foundation, $2,000,000 above the request and $2,893,000 above the 

fiscal year 2002 level. 

AFRICAN DEVELOPMENT FOUNDATION

Fiscal year 2002 level ......................................................................... $16,542,000 

Fiscal year 2003 request .................................................................... 16,689,000 

Committee recommendation .............................................................. 19,689,000 

The Committee recommends funding for the African Development Foundation at a level of $19,689,000. This is an increase of 

$3,147,000 above the fiscal year 2002 level and $3,000,000 above 

the request. The Committee has reviewed the work of the Foundation, and concludes that it could make effective use of an additional 

$3,000,000 in African countries where USAID does not have a presence. 

58

PEACE CORPS

Fiscal year 2002 level ......................................................................... $275,000,000 

Fiscal year 2003 request .................................................................... 317,000,000 

Committee recommendation .............................................................. 317,000,000 

The Committee recommends $317,000,000 for the Peace Corps, 

an amount that is equivalent to the budget request and 

$42,000,000 above the amount enacted for fiscal year 2002. Prior 

year language addressing purchase of motor vehicles, abortion, and 

availability of funds has been continued in this Act. The Committee 

strongly supports the work of the Peace Corps and of its volunteers 

who currently work in 70 countries. The Committee has included 

the entire amount requested by the President for the Peace Corps 

even though the Committee has concerns regarding plans to rapidly increase the number of Peace Corps volunteers. Safety and security of volunteers must remain the first priority of the agency, 

even if the Administration’s goal to double the number of volunteers must be delayed. 

The Committee includes a new provision that allows the Director 

of the Peace Corps to make appointments to permit Peace Corps 

employees to serve in excess of five years, the so-called five-year 

rule, in the case of individuals whose appointment involves the 

safety of Peace Corps volunteers. 

The Committee believes that if safety and security are the top 

priorities of the Administration, then the personnel regulations 

should reflect that commitment and not be limited by the five-year 

rule. Establishing appropriate law enforcement networks in each 

country takes time and frequent visits by dedicated creditable professionals who have both Peace Corps and law enforcement experience, similar to Regional Security Officers at overseas embassies. 

According to the July 25, 2002 GAO report on Peace Corps Safety 

and Security, implementation of the Peace Corps’ new security 

framework is being implemented unevenly, partly as a result of 

staff turnover because of the five-year rule. Consistency is needed 

to provide a safe and secure environment. The Committee expects 

the waiver to apply to overseas and headquarters employees of the 

new Office of Safety and Security. 

The Committee urges the Director of the Peace Corps to submit 

individual Country Security reports to accompany the annual report that outlines the security environment in all countries in 

which Peace Corps volunteers currently work. 

Currently, there are over 2,100 Peace Corps volunteers participating in HIV/AIDS activities worldwide. The Committee expects 

the Peace Corps to devote a substantial amount of the fiscal year 

2003 funding increase for additional health volunteers working 

with HIV/AIDS treatment and prevention methodologies and particularly the training of local HIV/AIDS trainers.

DEPARTMENT OF STATE

INTERNATIONAL NARCOTICS CONTROL AND LAW ENFORCEMENT

Fiscal year 2002 level ......................................................................... $217,000,000 

Emergency supplemental funding ..................................................... 114,000,000 

Fiscal year 2003 request .................................................................... 197,000,000 

Committee recommendation .............................................................. 197,000,000

59

The Committee recommends $197,000,000 for ‘‘International 

Narcotics Control and Law Enforcement’’. This is equivalent to the 

budget request and $134,000,000 less than the fiscal year 2002 

level, including emergency supplemental appropriations. A limitation of $24,062,000 is recommended for administrative expenses. 

NARCOTICS AND TERRORISM

Organized crime and terrorist groups throughout the world have 

long used narcotics as a means to generate revenues to support 

armed conflict and the means to spread turmoil. The Committee 

continues to support a strong United States counternarcotics assistance program in order to protect United States communities 

from the ravages of drugs, but increasingly to deny drug profits 

that are often used to finance terrorist activities. 

TERRORIST FINANCING

The Committee recognizes that the International Narcotics Control and Law Enforcement (INL) bureau at the Department of 

State has a substantial responsibility to support efforts to fight 

money laundering and other financial crimes worldwide. Due to the 

priority of the war against terrorism, the Committee directs the 

Secretary of State to provide a quarterly report beginning 30 days 

after the first quarter of fiscal year 2003, of the bureau’s obligation 

and expenditure of funds, by country, in support of combating terrorist financing. 

AFGHANISTAN

The Committee is concerned about reports that Afghan farmers 

are replanting poppy at greater rates even after the Afghan president announced a ban on poppy growing in April 2002. While Operation Enduring Freedom has successfully ousted the Taliban from 

Afghanistan, one unfortunate consequence has been the resurgence 

of opium planting and trafficking. 

The United States contribution to the Afghanistan poppy eradication program represents approximately 10 percent of the Britishled program. While the Committee lauds the efforts of the British 

government in tackling the opium industry, the Committee hopes 

the State Department will share with our allies our past experiences of providing individual compensation to farmers for not 

planting coca in the Andean region. This program faced many problems and resulted in contrary incentives and little means for 

verification. Given the existing lags in Afghanistan in the delivery 

of assistance, the difficulty of finding cash in country to make payments, and the resulting destruction of only a fraction of the poppy 

crop, the Committee recognizes that rural economic development in 

Afghanistan is the only long-term solution for the elimination of 

poppy. 

DEMAND REDUCTION

The Committee includes a provision that up to $10,000,000 in 

funds of the funds under this heading should be made available for 

demand reduction programs. As escalating drug use and abuse continue to take a devastating toll on the health, welfare, security, and 

economic stability of all nations, the importance of drug demand reVerDate Sep 04 2002 01:55 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00059 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.004 HR663
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duction has grown. The Committee expects that these funds could 

be used to contribute to the preservation of the stability of societies 

threatened by increasing drug abuse and minimizing the impact of 

international crime. 

ILEA

The Committee is concerned about the limited space and reported health and respiratory problems encountered by students 

undergoing training at the current classroom facility located at the 

Roswell Center. Therefore, the Committee strongly advises the administration to complete a new facility by allocating a combination 

of previously allocated funding, and future year funding to finish 

construction on a new facility that fully meets the terms of the 

agreement between INS and the Roswell Center. The Committee 

remains convinced that future funding necessary to complete construction for this facility will be contained in the next budget request, and that the facility will be completed prior to any initiatives to open an additional center in Latin America. 

CUBA

The Committee has included a new general provision, section 

581, prohibiting counternarcotics assistance to the Government of 

Cuba. An estimated 11 percent of the total cocaine flow toward the 

United States moves along the Jamaica-Cuba-Bahamas route, but 

according to the July 19, 2002 report from the Department of State, 

‘‘detected drug shipments to or through Cuban territory are low.’’

Additionally, according to the report, full reporting, transparency, 

and United States monitoring of the use of counternarcotics assistance would be ‘‘challenging’’ given Cuban ‘‘general hostility toward 

and resistance to the United States government’’. Finally, the report states that there are ‘‘legal and operational barriers’’ to providing counternarcotics assistance to Cuba, for example:

* * * the Border Guards (TGF) is the maritime drug 

interdiction force. TGF officers and men were involved in 

the 1994 sinking of a tugboat that resulted in the deaths 

of 41 men, women, and children. Since no adequate investigation of the event and punishment occurred, according 

to both Amnesty International and the Department’s 

Country Reports on Human Rights Practices * * * provision of assistance to the TGF would violate the Leahy 

amendment. 

TRAFFICKING IN PERSONS

The Committee has encountered difficulty obtaining timely, accurate, or complete information from the Department of State’s Office 

of Trafficking in Persons regarding international programs authorized by Public Law 106–386, the Victims of Trafficking and Violence Protection Act of 2000. 

The Committee requests that the Secretary of State obtain from 

the Office of Trafficking in Persons and transmit to the Committee 

not later than 30 days after enactment of this Act, a comprehensive 

financial plan on federal efforts to limit and eliminate international 

trafficking in persons. This financial plan should include, by agency, program and country of operation, planned obligations for fiscal 

61

year 2003, estimated obligation for fiscal year 2002 and actual obligations and expenditures during fiscal year 2001 by the Department of State, USAID, and other federal agencies operating abroad, 

and such other material that the Secretary may deem appropriate. 

ANDEAN COUNTERDRUG INITIATIVE

Fiscal year 2002 level ......................................................................... $625,000,000 

Fiscal year 2003 request .................................................................... 731,000,000 

Committee recommendation .............................................................. 731,000,000

The Committee recommends $731,000,000 for the Andean 

Counterdrug Initiative, an amount equal to the request and 

$106,000,000 above the 2002 level. The Andean Counterdrug Initiative is the continuation of the Administration’s multi-year 

counterdrug assistance efforts designed to sustain and expand programs initially funded by Plan Colombia in the fiscal year 2000 

emergency supplemental appropriations act. A limitation of 

$15,680,000 is recommended for administrative expenses for the 

Department of State and $4,500,000 for USAID. The Committee 

notes the requirement in the bill that the Secretary of State, in 

consultation with the Administrator of USAID, shall provide to the 

Committees on Appropriations not later than 45 days after the date 

of the enactment of this Act and prior to the initial obligation of 

funds appropriated under this heading, a report on the proposed 

uses of all funds under this heading on a country-by-country basis 

for each proposed program, project, or activity. This report is similar to the report required in the fiscal year 2000 emergency supplemental appropriations act and is required again in fiscal year 2003 

given the Committee’s disappointment in the level of pertinent information included in the Department of State’s Congressional 

Budget Justification and congressional notifications. 

The fiscal year 2000 emergency supplemental appropriations act 

provided over $1,000,000,000 in no-year funding for counternarcotics assistance in the Andean region. The Committee has 

learned that, more than two years after enactment of that Act, over 

half of the funds that were transferred by the Department of State 

to the Department of Justice for counternarcotics programs, have 

yet to be obligated by Justice. The Committee believes that the national interest of the United States would be better served if those 

funds, instead of sitting idle, be used to help combat the humanitarian crisis facing Colombia. Therefore, the Committee directs 

that the Department of State immediately terminate its inter-agency agreement with the Department of Justice and transfer remaining funds to USAID for development, rule of law, and humanitarian assistance programs. 

The Committee notes that section 520 of the bill applies to the 

use of Narcotics Control and Law Enforcement and Andean 

Counterdrug Initiative funds for Colombia.

ANDEAN NATIONS

The Committee calls on the Department of State to ensure that 

all United States laws regarding human rights, including section 

553 of this Act, are strictly applied in Colombia and each of the Andean nations. Additionally, the caps on the numbers of United 

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quests that the Secretary of State continue to submit to the Appropriations Committees a semi-annual report with respect to the Andean Counterdrug Initiative. Each report shall include an accounting of all aircraft, vehicles, boats and lethal equipment (other than 

ammunition) transferred to the militaries or police of any nation 

with funds made available under this heading. Further, the report 

shall contain an accounting of the number of United States Armed 

Forces personnel deployed or assigned to duty in the Andean Region or other nation at any time during the preceding 180 days 

with funds made available under this heading, the length and purpose of the deployment or assignment, and the associated costs and 

force protection risks. The Committee directs the Secretary of State 

to submit this report directly to the Committees on Appropriations. 

The Committee recognizes the important contribution The Field 

Museum of Chicago is making to protect biological and cultural values in the Andean region and urges USAID to support The Field 

Museum’s efforts to collaborate with local populations to promote 

economically and environmentally sustainable alternatives to growing illicit crops. 

COLOMBIA

The Committee urges President Bush to publicly support future 

peace efforts in Colombia. The Committee commends the Colombian president for his efforts in partnering with the United Nations 

in the Colombian government’s efforts to find a way to revive the 

peace process. While only a few weeks in office, the Committee 

hopes the collaboration between the Colombian president and the 

United Nations Secretariat General continues. 

The Committee notes that the people of Colombia have shown a 

long-term resilience and tolerance for difficult and violent conditions, but the Committee is concerned about the urgency of the current situation facing Colombia. The Committee hopes the government’s new fiscal policies will allow it to collect the additional resources needed to invest in the military, police, and social programs to establish security and give Colombians better access to 

services. 

The Committee recommends $1,000,000 for the Naval Post Graduate School (NPS) for programs to strengthen public engagement 

and democratic control of national security in Columbia. Building 

on the program stated with fiscal year 2002 funds, funds in this 

Act should be used to develop and execute programs to help Columbia redesign its strategic planning process, to strengthen democratic control over security decision making, to provide for greater 

public input and support of Columbian security police, and to institutionalize changes to improve the quality of strategic planning 

while reinforcing democratic principles. 

USE OF UNITED STATES ASSETS IN COLOMBIA

The Committee has extended the availability of funds provided 

for assistance for Colombia to support a unified campaign against 

narcotics trafficking, against activities by organizations designated 

as terrorist organizations, and to take actions to protect health and 

human welfare. The Committee is supportive of the Colombian government in its attempts to provide security for the Colombian people and has provided the expansion of authorities in recognition 

63

that the narcotics industry is invariably linked to the terrorist 

groups, including the paramilitary organizations, in Colombia. 

However, the Committee still concludes that coca provides the revenue and motive behind the violence committed by both the guerrilla and paramilitary groups. Therefore, the Committee expects 

counternarcotics, alternative development, and judicial reform to 

remain the principal focus of United States policy in Colombia. The 

expanded authority is not a signal from the Committee for the 

United States to become more deeply involved in assisting the Colombian Armed Forces in fighting the terrorist groups, especially 

not at the expense of the counternarcotics programs, but to provide 

the means for more effective intelligence gathering and fusion, and 

to provide the flexibility to the Department of State when the distinction between counternarcotics and counterterrorism are not 

clear cut. The Committee directs the Secretary of State to report 

to the Committee 90 days after enactment of the changes in United 

States policy, including new procedures and operations, as a result 

of implementing the expanded authorities. 

HUMAN RIGHTS

The bill includes again a general provision requiring that the 

Secretary of State certify that certain human rights conditions 

have been met before any funds may be made available for assistance for the Colombian Armed Forces. In the fiscal year 2002 appropriations act, section 567 required two certifications in the fiscal 

year. The Committee was alarmed to learn of the unintended costs 

to the pilot training program and the helicopter maintenance program that the semiannual certifications incurred at no apparent 

gain. Therefore the Committee recommends a one-time annual certification process in fiscal year 2003.

ALTERNATIVE DEVELOPMENT IN COLOMBIA

Nearly two-thirds of the coca grown in Colombia is in Putamayo. 

The Committee notes that spraying of coca only took place for three 

months over the last 24 months in this region. Therefore, the Committee is hopeful that the concerns of many that the spray program 

was proceeding faster than the development program in Putamayo 

have been alleviated, and that development programs have had the 

opportunity to accelerate over the most recent 17-month reprieve 

from spraying, from February 2001 to July 2002. 

The Committee is aware of the decades old cynicism among local 

residents of the region concerning alternative development and delivery of services. The Committee recognizes the excessive bureaucratic delays that have hindered day-to-day operations of development workers in Putamayo, and therefore the Committee recognizes the need for full cooperation of the Government of Colombia 

at the highest levels. With the expiration of the Government of Colombia’s social pacts with families in Putamayo, alternative development in Colombia is at a critical pass. 

The Committee strongly supports USAID’s ambitious new alternative development strategy. This new strategy, started at the beginning of 2002, will focus on the historic underdevelopment of the 

region and concentrate on local infrastructure needs (roads, electricity, water) and delivery of services at the community level. The 

new focus on the entire community increases the social pressure for 

64

eradication and also helps organize the community to identify and 

prioritize local needs. Since the start of this focus, the Committee 

understands that over 5,000 hectares have been manually and voluntarily eradicated in Putamayo. The Committee hopes USAID 

partners can continue building on their good working relationships 

with the mayors and local leaders. 

The Committee notes that Afro-Colombians represent at least 25 

percent of Colombia’s population, and Afro-Colombians suffer disproportionately from violence and displacement. The Pacific Coast 

region where many Afro-Colombians and indigenous peoples live is 

experiencing intensification of the Colombian conflict as the recent 

church massacre in Bojaya, Choco Province, on May 2, 2002 exemplified, in which 119 civilians, all of whom were Afro-Colombians, 

were killed. The Committee is concerned that United States assistance programs do not address adequately the Afro-Colombian community and people in the Pacific Coast region in general. The Committee expects USAID to take the views and specific problems of 

Afro-Colombians into account as it formulates assistance projects in 

the areas of human rights, democracy, displaced persons, and alternative development, including plans of return. The Committee 

urges USAID to provide significant additional funding to programs 

that benefit Afro-Colombian communities, municipalities, and 

NGOs.

HELICOPTER PROGRAM

The Committee recognizes the difficulty the Government of Colombia has had in recruiting the necessary number of Colombian 

candidates to become helicopter pilots. The Committee encourages 

the United States embassy in Bogota to continue negotiating with 

the Colombian Navy and Colombian Air Force in efforts to identify 

possible candidates to alleviate the pilot shortage. The Committee 

hopes the United States embassy in Bogota will work closely with 

the new Colombian Minister of Defense to find a way to combat 

inter-service and inter-agency rivalries that hinder counternarcotics efforts. The helicopters provided to Colombia as part of 

Plan Colombia have flown over 28,000 hours since the beginning of 

the program. The United States has made a significant investment 

in providing helicopters to Colombia and the Committee recognizes 

that future maintenance costs will be necessary to ensure the safety of pilots and crew. 

PERU

Peru is the second largest recipient of counternarcotics and alternative development assistance from the United States, and while 

the Committee is aware that the political environment in Peru has 

direct consequences for eradicating coca, the Committee is alarmed 

at reports that the Peruvian government is not cooperating fully in 

counternarcotics matters. The Committee believes that the appointment of the new drug tsar is a positive sign of commitment to counternarcotics by the Peruvian government, but nevertheless, manual 

eradication efforts are falling behind this year’s goals. The Committee realizes that safety issues are also contributing to the slow 

pace of eradication: that for every 60 eradicators, there must be 30 

security forces to protect them from coca growers. Therefore, the 

Committee urges the INL bureau to provide non-lethal means of 

65

riot control to the Peruvian police, who currently have no non-lethal ammunition at their disposal. 

BOLIVIA

The Committee takes special note of the progress that Bolivia 

has made in the war against drugs. The enormous success of the 

Bolivian Government’s Dignity Plan has been due, in large part, to 

the support of the United States. This progress was made at a tremendous sacrifice by the Bolivian people, and that the progress 

could be erased quickly if the commitment by either the Bolivian 

government or the United States were to falter. The Committee 

urges the Administration to continue its strong support of Bolivia’s 

efforts when deciding its allocation of aid. 

The Committee is concerned, however, with delays in the prosecutions of alleged human rights violations committed by security 

forces in Bolivia, funded in part with United States assistance. The 

Committee strongly encourages the Bolivian Government and the 

Department of State to take all necessary actions to ensure proper 

implementation of section 553 of this Act. 

EUROPEAN CONTRIBUTIONS

The Committee notes that demand for Colombian coca is rising 

in Europe and approaching United States consumption levels of approximately 300 tons a year. European nations and the European 

Union have contributed very little to eradication of coca or development programs in Colombia. The Committee again urges the Secretary of State to negotiate with our European allies in order to 

persuade them to contribute additional funds to counter-narcotics 

efforts, alternative development, and judicial reform in the Andean 

region. 

MIGRATION AND REFUGEE ASSISTANCE

Fiscal year 2002 level ......................................................................... $705,000,000 

Fiscal year 2003 request .................................................................... 705,000,000 

Committee recommendation .............................................................. 800,000,000 

The Committee recommends $800,000,000 for Migration and Refugee Assistance, an amount that is $95,000,000 above the request 

and $95,000,000 more than the amount enacted for fiscal year 

2002. A limitation of $16,000,000 is recommended for administrative expenses. 

AFGHANISTAN

Over 1,600,000 refugees have returned to Afghanistan from January to August 2002, far exceeding estimates by the Department 

of State and the United Nations High Commission for Refugees 

(UNHCR). Given the anticipated shortfall in funding in fiscal year 

2003 from the accelerated pace of Afghan refugees returning, the 

Committee expects the greater part of the funding increase that 

the Committee recommends for fiscal year 2003 be for Afghan refugees. 

While the number of internally displaced persons remains at a 

level of approximately 800,000, the Committee notes that refugee 

returns have most likely peaked and will continue to decline 

through fiscal year 2003. The Committee notes the desperate need 

66

for reconstruction and development assistance to combat the poverty facing returning refugees. 

REFUGEE RESETTLEMENT

The Committee notes that the President authorized up to 70,000 

refugees to be admitted to the United States for fiscal year 2002. 

To date, fewer than 20,000 have been actually admitted. The Committee is concerned that the discrepancy between authorized and 

actual number of refugees admitted gives the impression that the 

United States is abandoning humanitarian commitments and leadership in protecting the world’s most vulnerable people. Given the 

terrorist attacks on the United States, the Committee understands 

the need for the increased security procedures now applied to the 

resettlement process. While there has been an increase in the cost 

per refugee for admission, the Committee notes a significant carryover of funds into fiscal year 2003 because of security-related 

delays, therefore the Committee expects the Department of State 

to fully consult with the Committee as it decides the disposition of 

the 2002 carryover funds. 

TIBETAN REFUGEES

The Committee supports continued funding to assist Tibetan refugees and directs $2,000,000 for this purpose. The Committee requests that the Department of State coordinate with the Agency for 

International Development in determining the funding responsibility for long-term assistance for Tibetan refugees, including assistance to refugees residing in India. 

RESETTLEMENT IN ISRAEL

The Committee supports $60,000,000 for humanitarian migrants 

from the former Soviet Union and other countries of distress resettling in Israel. Since 1989, Israel has accepted more than one million refugees. The Committee remains strongly committed to assisting the resettlement of Russian, Eastern European, Ethiopian and 

other humanitarian migrants in Israel. The funds provided in this 

bill assist in the transportation and initial absorption costs for 

more than 100,000 migrants per year. The Committee notes, however, there has been a modest decline in the numbers arriving from 

the former Soviet Union in the last year. Should the current decline continue, the Committee expects this program to be funded at 

a level of $50,000,000 in fiscal year 2004. 

MAGEN DAVID ADOM SOCIETY

The Committee is disappointed again this year that the International Committee of the Red Cross (ICRC) has not taken action 

to admit the Magen David Adom Society of Israel to the International Red Cross and Red Crescent Movement. The American 

Red Cross has promoted the membership of the Society in the 

Movement, but little positive action has been forthcoming. As a result, the American Red Cross has withheld its headquarters contribution to the ICRC for the past three years. Therefore the Committee is recommending a continuation of bill language that would 

also withhold the annual headquarters contribution made by the 

Department of State unless the Magen David Adom Society is 

67

given the opportunity to participate in the activities of the International Red Cross and Red Crescent Movement. This limitation 

will not, and is not intended to, restrict funding for humanitarian 

assistance programs that may be programmed through the ICRC 

using other funds provided in this account. It is only intended to 

affect the funding the United States provides on an annual basis 

to the ICRC bureaucracy in Geneva. 

UNHCR

The Committee is aware that the Department of State traditionally contributes twenty to twenty-five percent of the funds required 

for refugee programs managed by the United Nations High Commissioner for Refugees and certain other international relief agencies. The United States contribution as a share of the total has escalated in the past few years as European nations have not followed through with pledged contributions. The Committee supports 

the High Commissioner in his efforts to increase UNHCR contributions from Europe. 

UNRWA

The Committee is concerned by reports that certain employees of 

the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) may not have acted appropriately 

during recent violence in the West Bank and Gaza. The Committee 

notes that section 301(c) of the Foreign Assistance Act mandates 

that no contribution may be made by the United States to UNRWA 

except on the condition that UNRWA take all possible measures to 

assure that no part of the United States contribution shall be used 

to furnish assistance to any refugee who is receiving military training as a member of the so-called Palestine Liberation Army or any 

other guerilla type organization or who has engaged in any act of 

terrorism. In a general provision (section 575) the Committee directs the Comptroller General to review the implementation of section 301(c), and asks for a report from the Secretary of State on 

procedures that have been established to ensure that section 301(c) 

is enforced to the fullest extent practicable. 

The Committee strongly supports humanitarian assistance for 

the Palestinian people, both under this account and through the bilateral West Bank and Gaza Program. The importance of such assistance has been highlighted by a recent report issued by the 

United States Agency for International Development that indicates 

an increase in malnutrition among Palestinian children in the West 

Bank and Gaza. For this reason it is especially important that 

United States humanitarian and refugee assistance be provided 

strictly for the purposes authorized in law. 

NORTH KOREA REFUGEES

The Committee condemns the Government of North Korea for 

the abuses inflicted upon the people of North Korea and notes that 

extra-judicial killings, torture, starvation and a failed economy 

have caused thousands of North Koreans to seek refuge in the People’s Republic of China (PRC). The Committee urges the Administration to encourage the PRC to honor its international obligations 

regarding the treatment of refugees and asylum seekers, and allow 

68

international observers access to the PRC-North Korea border area 

to help determine which individuals require protection as refugees. 

The Committee is deeply troubled by the fate that awaits those 

who are forcibly repatriated to North Korea. 

UNITED STATES EMERGENCY REFUGEE AND MIGRATION ASSISTANCE

FUND

Fiscal year 2002 level ......................................................................... $15,000,000 

Fiscal year 2003 request .................................................................... 15,000,000 

Committee recommendation .............................................................. 20,000,000 

The Committee recommends $20,000,000 for the Emergency Refugee and Migration Assistance (ERMA) Fund, which is the 

$5,000,000 above the 2002 enacted level and $5,000,000 above the 

request. 

NONPROLIFERATION, ANTI-TERRORISM, DEMINING AND RELATED

PROGRAMS

Fiscal year 2002 level ......................................................................... $311,600,000 

Emergency supplemental appropriations ......................................... 83,000,000 

Fiscal year 2003 request .................................................................... 372,400,000 

Committee recommendation .............................................................. 347,400,000 

The Committee recommends a total appropriation of 

$347,400,000 for ‘‘Nonproliferation, Anti-terrorism, Demining and 

Related Programs’’, an amount that is $25,000,000 below the request and $47,200,000 below the fiscal year 2002 enacted level, including emergency supplemental appropriations. 

The Committee recommendation funds the President’s budget request for this account with the exception of a reduction of 

$25,000,000 in the funding for the Korean Peninsula Energy Development Organization (KEDO). 

The Committee has included bill language from the fiscal year 

2002 appropriations act that imposes the requirement for notice 

prior to the obligation of funds for the CTBT Preparatory Commission. 

The following is a chart that indicates fiscal year 2002 funding 

for the programs covered by this account, as well as the President’s 

request for fiscal year 2003 and the Committee recommendation:

FY 2002 enacted FY 2003 request FY 2003 House 

Nonproliferation and Disarmament Fund ................................................... 14,000,000 15,000,000 15,000,000 

Export Control & Border Security ................................................................ 17,000,000 36,000,000 36,000,000 

Science Centers/BW Redirection ................................................................. 37,000,000 52,000,000 52,000,000

IAEA Voluntary Contribution ........................................................................ 50,000,000 50,000,000 50,000,000 

CTBT International Monitoring System ....................................................... 20,000,000 18,200,000 18,200,000 

Korean Peninsula Energy Development Organization ................................. 90,500,000 75,000,000 50,000,000 

Anti-terrorism Assistance ........................................................................... 38,000,000 64,200,000 64,200,000 

Terrorist Interdiction Program ..................................................................... 4,000,000 5,000,000 5,000,000 

Humanitarian Demining Program ............................................................... 40,000,000 45,000,000 45,000,000 

International Trust Fund ............................................................................. ........................ 10,000,000 10,000,000 

Small Arms Destruction .............................................................................. 3,000,000 2,000,000 2,000,000

Total ............................................................................................... 313,500,000 372,400,000 347,400,000 

Note.—FY 2003 budget consolidates into this account most export control and border security assistance programs previously funded in the account ‘‘Assistance for the Independent States of the Former Soviet Union’’ ($20,500,000 estimate for FY 2002), as well as funding for the 

Biological Warfare Redirect program ($15,000,000 estimate for FY 2002). The FY 2002 column in the above table does not include 

$155,700,000 allocated to programs in this account from the Emergency Response Fund, or $88,000,000 appropriated for this account in the 2002 Supplemental Appropriations Act for Further Recovery From and Response To Terrorist Attacks on the United States. 

69

KEDO

The funding reduction of $25,000,000 for KEDO is being made 

with the expectation the Administration will renew its efforts to obtain funding from other donors to help offset the costs for the provision of heavy fuel oil for North Korea pursuant to the Agreed 

Framework. In addition, the Committee is concerned the President 

failed to certify in fiscal year 2002 that North Korea is in compliance with the Agreed Framework. The provision of heavy fuel oil 

and participation in KEDO is predicated on such compliance. In 

order to clarify this issue, the Committee recommendation regarding the general provision on KEDO (section 559) would not allow 

the President to waive the requirement for compliance with the 

Agreed Framework in order to obligate funds for KEDO. 

DEMINING

The Committee is recommending the full request of $55,000,000 

for humanitarian demining, including $10,000,000 for the Slovenian International Trust Fund. The Committee directs that such 

amounts may be deposited into that fund only to the extent of deposits of matching amounts by other governments, entities, or persons. In addition, these funds should only be expended by the fund 

in consultation with the United States Government. The Committee further directs that deposits into the fund shall be subject 

to the regular notification procedures of the Committees on Appropriations. 

ALBANIA

The Committee urges the Department of State to provide up to 

$1,500,000 as a United States contribution to an international effort to provide Albania with the means to destroy hundreds of tons 

of excess ammunition. These funds would be used to purchase an 

explosive waste incinerator. The project has been initiated under 

the Partnership for Peace (PFP) program. Funding may be derived 

from this account, or from funds appropriated under the headings 

‘‘Foreign Military Financing Program’’ and ‘‘Peacekeeping Operations’’. 

DEPARTMENT OF THE TREASURY

INTERNATIONAL AFFAIRS TECHNICAL ASSISTANCE

Fiscal year 2002 level ......................................................................... $6,500,000 

Fiscal year 2003 request .................................................................... 10,000,000 

Committee recommendation .............................................................. 11,000,000 

The Committee recommends $11,000,000 under this heading for 

international technical assistance by the Department of the Treasury, an amount that is $1,000,000 above the request and 

$4,500,000 above last year’s level. In operation since 1991, Treasury’s Office of Technical Assistance provides expert fiscal and monetary policy advisors to countries of the former Soviet Union and 

Eastern Europe. Beginning in fiscal year 1999, Treasury created 

the Treasury International Affairs Technical Assistance (TIATA) 

program and expanded the countries to Asia, Africa and Latin 

America. The Committee directs the Office of Technical Assistance 

to notify the Committee prior to the obligation of funds for the comVerDate Sep 04 2002 01:55 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00069 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.005 HR663
70

pensation or travel expenses of any individual who is not an employee of the Department of Treasury. 

TITLE III—MILITARY ASSISTANCE 

FUNDS APPROPRIATED TO THE PRESIDENT

INTERNATIONAL MILITARY EDUCATION AND TRAINING

Fiscal year 2002 level ......................................................................... $70,000,000 

Fiscal year 2003 request .................................................................... 80,000,000 

Committee recommendation .............................................................. 80,000,000 

The Committee recommends $80,000,000 for the International 

Military Education and Training program, which represents an increase of $10,000,000 above the fiscal year 2002 level and is the 

same as the requested level. 

The Committee has included language in section 534 to allow the 

Administration to obligate funds for military education and training for Cambodia, notwithstanding section 557 of this Act. The 

President’s fiscal year 2003 budget request includes $200,000 for 

this purpose. In implementing this program, the Committee directs 

that strict vetting procedures be instituted for the individuals that 

will be involved in the program. The Committee notes that any program must comply with section 553 of this Act, ‘‘Limitation on Assistance to Security Forces’’. 

GUATEMALA

The Committee includes prior year bill language limiting Guatemala to Expanded IMET only, subject to notification. 

IMET AVAILABILITY

The Committee has retained language from fiscal year 2002, 

which provides that, of the funds made available for IMET, 

$3,000,000 may remain available until expended. 

FOREIGN MILITARY TRAINING REPORT

The Committee is pleased the Departments of State and Defense 

responded to the Committee’s recommendation and made key information public in the most recent Foreign Military Training Report. 

The Committee believes this information should remain available 

to the public in future editions of this report. 

INDONESIA

The Committee recommendation does not include prior year language that would have restricted IMET for Indonesia to Expanded 

IMET (E–IMET). In addition, language in section 564 (‘‘Indonesia’’) 

has been modified to require certain determinations prior to the obligation of funds for assistance for Indonesia appropriated in the 

account ‘‘Foreign Military Financing Program’’, but the obligation 

of funds for assistance for Indonesia under IMET would not be subject to these determinations.

71

FOREIGN MILITARY FINANCING PROGRAM

(INCLUDING TRANSFER OF FUNDS)

Fiscal year 2002 level ......................................................................... $3,650,000,000 

Emergency supplemental funding ..................................................... 357,000,000 

Fiscal year 2003 request .................................................................... 4,107,200,000 

Committee recommendation .............................................................. 4,080,200,000 

(by transfer) ................................................................................. (98,000,000) 

The Committee recommends $4,080,200,000 in Foreign Military Financing grants. This program level is $73,200,000 above the fiscal year 2002 level, including emergency supplemental appropriations, and $27,000,000 below the President’s request. The increase 

above the fiscal year 2002 level is primarily due to an increase of 

$60,000,000 for Israel, as requested by the President. Funding of $98,000,000 for Colombia is appropriated in this account, as requested, but for purposes of program implementation 

bill language is proposed that allows the funds to be transferred to 

‘‘International Narcotics Control and Law Enforcement’’. As a result the Committee has also included bill language prohibiting the 

expenditure of other funds appropriated under this heading for Colombia for helicopters and related support. 

ISRAEL

The Committee recommends a total Foreign Military Financing 

(FMF) program of not less than $2,100,000,000 in grants for Israel 

which shall be available within 30 days of enactment or by October 

31, 2002, whichever is later. 

It is the Committee’s view that while Israel’s economy has improved in recent years, the security situation in the Middle East 

has significantly worsened. Therefore, the Committee is convinced 

the United States must make every effort to carry out its longstanding policy of ensuring that Israel’s technological edge is maintained. As a result, the Committee has provided an increase of 

$60,000,000 above the fiscal year 2002 level, as requested by the 

President. The Committee also believes that a sustained military 

improvement program will be required over the next five years, at 

an annual rate of approximately $60,000,000, to assist Israel in responding to these emerging security challenges. However, with respect to this recommended increase in military assistance, the 

Committee must be very clear that it cannot commit future Congresses to the future appropriation of funds. Therefore, future increases in military assistance will require the annual review of the 

Congress and will necessarily be based upon an assessment of the 

security situation at the time. 

The Committee also recommends that, to the extent that the 

Government of Israel requests that FMF grant funds for Israel be 

used for such purposes, and as agreed by Israel and the United 

States, funds may be made available for advanced weapons systems of which $550,000,000 shall be available for the procurement 

in Israel of defense articles and defense services, including research 

and development. This represents a $15,000,000 increase over the 

fiscal year 2002 level and reflects a recognition by the Committee 

of Israel’s need for similar annual increases over the next few years 

in order to provide Israel with increased flexibility in meeting the 

emerging security challenges in the Middle East.

72

JORDAN

The Committee strongly supports the Administration’s efforts to 

improve Jordanian security and therefore recommends full funding 

of the President’s request of $198,000,000 for Jordan. Under the 

able leadership of King Abdullah, Jordan plays a critical role in 

supporting peace and security in the Middle East. The Committee 

is well aware that Jordan’s security requirements are extensive, 

particularly in the areas of ground force modernization and border 

security. 

EGYPT

The Committee recommends a total of $1,300,000,000 in Foreign 

Military Financing grants for Egypt. 

Pursuant to the President’s budget request bill language is recommended that would require that funds estimated to be outlayed 

for Egypt during fiscal year 2003 shall be transferred to an interest 

bearing account for Egypt in the Federal Reserve Bank of New 

York within 30 days of enactment of this Act or by October 31, 

2002, whichever is later. The Committee is convinced that continued military cooperation between Egypt and the United States remains in the national security interests of both countries. 

THE BALTICS

The Committee strongly supports at least the Presidents’ budget 

request of $21,250,000 for Estonia, Latvia, and Lithuania. Previous 

years’ funding has significantly supported the commendable efforts 

of these countries to attain Western military standards and to improve their capacities to contribute to international security 

through the provision of peacekeepers to international peacekeeping missions. 

TURKEY

The Committee supports the budget request of $17,500,000 for 

Turkey with the understanding that it will be used only to support 

that country’s command of the International Security Assistance 

Force (ISAF) in Afghanistan and for its military role in Operation 

Enduring Freedom and other areas in the war on terrorism. Given 

these imperatives, the Committee is not considering the traditional 

10–to–7 ratio of aid to Greece. 

ARMENIA AND AZERBAIJAN

The Committee supports the President’s budget request of 

$3,000,000 for assistance for Armenia and $3,000,000 for assistance 

for Azerbaijan. In addition, the Committee supports IMET assistance levels of $750,000 for both countries as requested by the 

President. 

MALTA

The Committee is recommending that $6,000,000 be made available for Malta to enable that country to purchase an additional 

coastal patrol craft and for other military assistance. Malta’s position in the middle of the Mediterranean gives it a crucial role in 

the interdiction of drug trafficking, illegal weapons shipments, and 

73

other smuggling activities. The Committee is also aware of the 

great increase in recent years in port calls and ship support provided by Malta for the United States Navy. 

ADMINISTRATIVE EXPENSES

The Committee has recommended a limitation on administrative 

expenses of $38,000,000. This is $1,000,000 above the level requested by the President and is $1,000,000 above the fiscal year 

2002 level, including $2,000,000 in emergency supplemental funds. 

The increase above the budget request is intended to allow the Defense Security Cooperation Agency (DSCA) to annualize overseas 

costs associated with the emergency supplemental appropriations 

act. 

FOREIGN MILITARY FINANCING SURCHARGE

The Committee has included a limitation on Foreign Military Financing operating costs of $356,000,000. This limitation may be 

waived pursuant to the regular notification procedures of the Committees on Appropriations. This is $8,000,000 more than the fiscal 

year 2002 level and the same as the request. 

FMF EXPENDITURE RATE

The Committee continues prior year language that requires that 

Foreign Military Financing funds be expended at the minimum 

rate necessary to make timely payments for defense articles and 

services. In addition, it continues language providing that such 

funds shall be obligated upon apportionment in order to allow for 

the orderly execution of program funds. 

PROCUREMENT AGREEMENTS

The Committee has continued prior year language requiring recipients of Foreign Military Financing grants to sign agreements 

with the United States prior to using FMF funds to finance the 

procurement of any item not sold by the United States under the 

Arms Export Control Act. 

PROHIBITIONS

The Committee has included bill language prohibiting military 

assistance to Sudan and Liberia. The Administration did not request military assistance for Sudan or Liberia for fiscal year 2003. 

The Committee continues to support United States assistance to 

Guatemala to implement the Guatemalan peace accords. However, 

it remains concerned about limited progress in certain areas such 

as reform of the Guatemalan military. Therefore the Committee retains the existing ban on Foreign Military Financing and International Military Education and Training (IMET), with the exception of E–IMET. The Committee expects the State Department to 

continue to press the Guatemalan government to address corruption, comply with the peace accords, follow through on the recommendations of the Historical Clarification Commission, and 

move forward on important unresolved human rights cases. 

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PEACEKEEPING OPERATIONS

Fiscal year 2002 level ......................................................................... $135,000,000 

Emergency supplemental funding ..................................................... 20,000,000 

Fiscal year 2003 request .................................................................... 108,250,000 

Committee recommendation .............................................................. 125,000,000 

The Committee recommends $125,000,000 for voluntary contributions for international peacekeeping operations. This amount is 

$30,000,000 below the level provided in fiscal year 2002, including 

emergency supplemental appropriations, and is $16,750,000 above 

the President’s request. 

The Committee recommendation reflects recognition of the need 

for additional resources to respond to recent peace initiatives in Africa, such as in Sudan. 

TITLE IV—MULTILATERAL ECONOMIC ASSISTANCE 

INTERNATIONAL FINANCIAL INSTITUTIONS

GLOBAL ENVIRONMENT FACILITY

Fiscal year 2002 level ......................................................................... $100,500,000 

Fiscal year 2003 request .................................................................... 177,812,533 

Committee recommendation .............................................................. 147,812,533 

The Committee recommends $147,812,533 for the Global Environment Facility (GEF), administered by the World Bank. Of the 

amount provided, $107,500,000 is intended for the scheduled 

United States annual payment to the third replenishment of GEF 

and $40,312,533 for past payments due. The recommendation is 

$30,000,000 below the request and $47,312,533 more than the 

amount enacted for 2002. 

CONTRIBUTION TO THE INTERNATIONAL DEVELOPMENT ASSOCIATION

Fiscal year 2002 level ......................................................................... $792,400,000 

Fiscal year 2003 request .................................................................... 874,338,333 

Committee recommendation .............................................................. 874,338,333 

The Committee is providing $874,338,333 for the U.S. contribution to the International Development Association (IDA), the same 

as the request and a $81,938,333 increase above the 2002 enacted 

level. Of the total, $850,000,000 is intended for the first of three 

payments under the United States commitment to the thirteenth 

replenishment of IDA and $24,338,333 for past payments due. 

The Committee commends the Department of Treasury in its negotiations for the thirteenth replenishment of IDA, and for the resulting agreement that would expand the use of grants as a part 

of the World Bank’s assistance for the poorest countries. 18 to 21 

percent of all IDA resources will be provided in the form of grants. 

The Committee strongly holds the opinion that countries in Africa, 

where the HIV/AIDS crisis is deepening, should not be forced to 

take loans to finance their health care and education. Grants from 

the World Bank will allow the poorest countries to avoid insupportable levels of debt in the future. 

The Committee agrees with the Secretary of Treasury that the 

World Bank must be more rigorous in measuring the results of its 

programs, and programs should focus on economic growth, health, 

education, and the alleviation of poverty. Developing benchmarks 

75

for assessing aid is not a straightforward or precise process, therefore the Committee is concerned about the Administration’s announcement that it will seek funding increased levels of 

$950,000,000 in fiscal year 2004 and $1,050,000,000 in fiscal year 

2005 if the World Bank meets certain benchmarks. The Committee 

expects the Department of Treasury to consult on an on-going basis 

with the Committee as benchmarks are developed and programs 

are evaluated. 

CONTRIBUTION TO THE MULTILATERAL INVESTMENT GUARANTEE

AGENCY

Fiscal year 2002 level ......................................................................... $5,000,000 

Fiscal year 2003 request .................................................................... 3,630,696 

Committee recommendation .............................................................. 1,630,696 

(LIMITATION ON CALLABLE CAPITAL SUBSCRIPTIONS)

Fiscal year 2002 level ......................................................................... ($25,000,000) 

Fiscal year 2003 request .................................................................... (14,825,178) 

Committee recommendation .............................................................. (6,825,178) 

The Committee is providing $1,630,696 for past payments due by 

the United States to the World Bank’s Multilateral Investment 

Guarantee Agency, $2,000,000 below the request and $3,369,304 

less than the 2002 enacted level.

GENERAL CONCERNS ABOUT THE WORLD BANK GROUP

OBJECTIVES

The Committee is concerned that with the many reform proposals for the World Bank over the years, few have resulted in 

major changes to the Bank’s basic structure or function. The Committee believes the World Bank and other multilateral development 

banks should have a clear set of objectives with the top priority to 

raise the standard of living of people throughout the world. The 

Committee supports the Treasury Department’s attempts to focus 

the World Bank’s core objective to raising per capita income and 

economic growth and the Committee urges the Administration to 

include basic education in the scope of activities that fall under this 

purpose. 

FORESTS

The Committee notes the World Bank has revised its forest policy, lifting the prohibition against financing of commercial logging 

operations in primary tropical forest and exempting the policy’s application to the International Finance Corporation (IFC) or the 

Multilateral Investment Guarantee Agency (MIGA), the Bank’s private-sector arms, and to structural adjustment lending. The Committee is concerned with the Bank’s record in environmentally sensitive sectors and questions the ability of the Bank to implement 

and monitor the provisions of a more complex forest policy. The 

Committee directs the Secretary of the Treasury and the United 

States Executive Director at the World Bank to work with management to ensure that Bank operations do not jeopardize primary or 

old growth forests or critical natural habitats or the rights and 

local economies of indigenous peoples and long-term forest inhabitants.

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AVAILABILITY OF INFORMATION

The Committee is concerned with the lack of contact and information provided by the World Bank Group and regional development banks. The Committee is disappointed that it must request 

annual reports and information about the basic functions of each 

institution. Future and continued support for the banks cannot be 

guaranteed unless future requests are better justified by the Department of Treasury as well as the management of each individual institution. 

INTER-AMERICAN INVESTMENT CORPORATION

Fiscal year 2002 level ......................................................................... $18,000,000 

Fiscal year 2003 request .................................................................... 30,351,667 

Committee recommendation .............................................................. 30,351,667 

The Committee recommends an appropriation of $30,351,667 for 

the Inter-American Investment Corporation, of which $25,000,000 

is to meet the scheduled United States annual purchase of share 

capital of the Inter-American Investment Corporation and 

$5,351,667 for past due payments. The recommendation is the 

same as the request and $12,351,667 more than the 2002 enacted 

level. 

For the past 10 years, the Inter-American Investment Corporation has supported small and medium private enterprises in Latin 

America and the Caribbean through strategic equity investments 

and loans. The small and medium enterprise sector is the major 

source of new jobs and economic growth in the region, but is generally overlooked by multilateral banks that focus on the public 

sector and bilateral donor agencies that focus on microenterprise 

credit. 

MULTILATERAL INVESTMENT FUND

Fiscal year 2002 level ......................................................................... ............................

Fiscal year 2003 request .................................................................... $29,590,667 

Committee recommendation .............................................................. 24,590,667 

The Committee recommends an appropriation of $24,590,667 for 

past due payments for the Multilateral Investment Fund (MIF). 

The recommendation is $5,000,000 below the request. There was no 

appropriation in 2002. 

The Multilateral Investment Fund (MIF) is the major source of 

multilateral technical assistance grants for micro and small business development in Latin America and the Caribbean. 

CONTRIBUTION TO THE ASIAN DEVELOPMENT FUND

Fiscal year 2002 level ......................................................................... $98,017,050 

Fiscal year 2003 request .................................................................... 147,386,133 

Committee recommendation .............................................................. 97,886,133

The Committee recommends an appropriation of $97,886,133 for 

the concessional Asian Development Fund, an amount that is 

$130,917 below the amount provided in fiscal year 2002 and 

$49,500,000 below the amount requested. 

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CONTRIBUTION TO THE AFRICAN DEVELOPMENT BANK

Fiscal year 2002 level ......................................................................... $5,100,000 

Fiscal year 2003 request .................................................................... 5,104,473 

Committee recommendation .............................................................. 5,104,473

(LIMITATION ON CALLABLE CAPITAL SUBSCRIPTIONS)

Fiscal year 2002 level ......................................................................... ($79,991,500) 

Fiscal year 2003 request .................................................................... (79,602,688) 

Committee recommendation .............................................................. (79,602,688) 

The Committee recommends an appropriation of $5,104,473 for the African Development Bank, an amount that is $4,473 above the 

amount provided in fiscal year 2002 and the same as the amount 

requested. The Committee intends that $5,100,000 of the amount 

provided be for the annual United States payment and $4,473 for 

past payments due. The Committee notes the error in the Department of Treasury Congressional budget justification estimates for 

this request. 

CONTRIBUTION TO THE AFRICAN DEVELOPMENT FUND

Fiscal year 2002 level ......................................................................... $100,000,000 

Fiscal year 2003 request .................................................................... 118,073,333 

Committee recommendation .............................................................. 113,073,333 

The recommendation for the concessional African Development Fund is $113,073,333, which is $5,000,000 less than the amount requested and $13,073,333 above the amount provided in fiscal year 

2002. 

CONTRIBUTION TO THE EUROPEAN BANK FOR RECONSTRUCTION AND

DEVELOPMENT

Fiscal year 2002 level ......................................................................... $35,778,717 

Fiscal year 2003 request .................................................................... 35,804,955 

Committee recommendation .............................................................. 35,804,955 

(LIMITATION ON CALLABLE CAPITAL SUBSCRIPTIONS)

Fiscal year 2002 level ......................................................................... ($123,237,803) 

Fiscal year 2003 request .................................................................... (123,328,178) 

Committee recommendation .............................................................. (123,328,178) 

The Committee is recommending $35,804,955 for the European 

Bank for Reconstruction and Development. This amount is the 

same as the President’s request and $26,238 more than the appropriation provided in fiscal year 2002. 

CONTRIBUTION TO THE INTERNATIONAL FUND FOR AGRICULTURAL

DEVELOPMENT

Fiscal year 2002 level ......................................................................... $20,000,000 

Fiscal year 2003 request .................................................................... 15,004,000 

Committee recommendation .............................................................. 15,004,000 

The Committee is again providing a separate appropriation for 

the International Fund for Agricultural Development (IFAD), reflecting the assumption of responsibility for this multilateral institution by the Department of the Treasury in February, 2000. The 

fiscal year 2003 recommendation is $15,004,000, the same as the 

request and $4,996,000 below the amount provided in fiscal year 

2002. 

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Cooperatives and credit unions should be a critical element of 

IFAD programs in reaching low-income farmers and entrepreneurs 

in developing countries. The Committee encourages IFAD to better 

utilize the technical know-how of, and to collaborate with, United 

States cooperative development organizations to build sustainable, 

member-owned cooperatives and credit unions. In particular, the 

Committee looks favorably on IFAD’s new Rural Finance Policy, a 

vital tool in poverty reduction and rural development. Cooperatives, credit unions and producer-owned associations are essential 

for providing sustainable rural financial and business services, including for micro-finance and savings mobilization of small farmers. The Committee encourages IFAD to better tap the United 

States cooperative and credit union experience in forming sustainable farm credit institutions and rural credit unions. 

INTERNATIONAL ORGANIZATIONS AND PROGRAMS

Fiscal year 2002 level ......................................................................... $208,500,000 

Fiscal year 2003 request .................................................................... 310,400,000 

Committee recommendation .............................................................. 190,400,000 

The Committee has recommended $190,400,000 for International 

Organizations and Programs. This is $18,100,000 less than the fiscal year 2002 level and $120,000,000 less than the President’s request. As in fiscal year 2002, funding for a grant to UNICEF is provided in the ‘‘Child Survival and Disease Programs Fund’’ under 

title II. Once this funding is taken into account, the Committee recommendation is the same as the request. The United Nations Population Fund (UNFPA) is discussed in section 568. 

The Committee recommendation also continues prior year bill 

language prohibiting the use of funds for the Korean Peninsula Energy Development Organization (KEDO) or the International Atomic Energy Agency (IAEA). Both organizations are funded under 

‘‘Nonproliferation, Anti-Terrorism, Demining and Related Programs’’. 

UNITED NATIONS DEVELOPMENT PROGRAM

The Committee recommends a level not less than $100,000,000 

in International Organizations and Programs funding be set aside 

to support the United Nations Development Program (UNDP). 

UNITED NATIONS VOLUNTARY FUND FOR VICTIMS OF TORTURE

The Committee supports not less than $5,000,000 for the United 

States contribution to the United Nations Voluntary Fund for Victims of Torture. Assisting these centers not only reinforces United 

States opposition to human rights violations but has proven to be 

an effective method for lessening the incidence of torture and promotes human rights and democracy abroad. The Committee urges 

the Department of State to negotiate with other governments to 

persuade them to increase their contributions to the Fund. 

TITLE V—GENERAL PROVISIONS 

The Committee recommends that 17 of the general provisions 

carried in the fiscal year 2002 act be deleted. These provisions (sections 523, 541, 551, 552, 559, 560, 561, 566, 579, 583, 585–87, and 

589–92) are either addressed elsewhere in permanent law, have 

79

been considered by the appropriate authorizing committee, or are 

no longer necessary. 

The Committee recommends the following new and revised general provisions. 

Sec. 509, ‘‘Transfers Between Accounts’’ is modified by adding 

two new subsections: prohibiting transfers of funds made available 

by this Act other than those transfers provided for by this Act, any 

other appropriations Act, or sections 109, 610 and 632 of the Foreign Assistance Act of 1961; and requiring the inspectors general 

of agencies in receipt of transfers of funds provided by this Act to 

perform and make available to the Committee periodic program 

and financial audits of the use of such funds. 

Sec. 512, ‘‘Limitation on Assistance to Countries in Default’’ is 

modified by narrowing the application of the limitation to assistance to the government of any country in default. 

Sec. 520, ‘‘Special Notification Requirements’’ is modified to delete Serbia and Haiti. 

Sec. 522, ‘‘Child Survival and Health Activities’’ is revised by reducing from $15,500,000 to $11,000,000 the amount from the Child 

Survival and Health Program Fund that may be used to reimburse 

other agencies, institutions and private organizations for the full 

cost of individual USAID staff who would otherwise be compensated from the USAID Operating Expenses account; by increasing from $3,000,000 to $3,500,000 the amount of Development Assistance funds that may be used for similar reimbursements relating to operating expenses for administration of basic education activities; and by deleting the requirement that $446,000,000 shall be 

made available for family planning/reproductive health. 

Sec. 523, ‘‘Afghanistan’’ is a new general provision providing that 

not less than $295,500,000 shall be provided for humanitarian and 

reconstruction activities in Afghanistan, of which not less than 

$2,500,000 should be for women’s centers. 

Sec. 526, ‘‘Democracy Programs’’ is modified by deleting language 

providing that not less than $10,000,000 shall be made available 

for democracy activities in China, but retaining a ceiling of 

$3,000,000 for certain activities in Tibet that are undertaken by 

nongovernmental organizations incorporated outside of China; it 

also modifies a provision regarding democracy, rule of law, and 

women’s development programs in countries with a significant 

Muslim population by deleting the minimum funding level and all 

references to the Bureau of Democracy, Human Rights and Labor, 

Department of State. 

Sec. 528, ‘‘Debt-for-Development’’ is modified by limiting its application to debt exchanges and deleting references to endowment 

and economic assistance activities. 

Sec. 534, ‘‘Special Authorities’’ is revised by: in subsection (a) expanding its application to all assistance to Afghanistan and modifying restrictions on assistance for Cambodia; in subsection (c) by 

reducing the number of additional USAID personal service contractors in the United States from 25 to 15 and limiting their temporary deployment to the offices of Procurement and of Food for 

Peace and the bureaus for Africa and for Asia and the Near East; 

and by adding a new subsection (g) that extends an additional year 

certain authorities contained in section 602 of Public Law 107–206 

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regarding the shipment of humanitarian assistance that applied 

only during fiscal year 2002. 

Sec. 538, ‘‘Earmarks’’ is modified in subsection (a) by replacing 

the word ‘‘impossible’’ with the words ‘‘not possible’’. Sec. 544, ‘‘Withholding of Assistance for Parking Fines Owed by 

Foreign Countries’’ is modified in subsection (a) by changing a reference to the date of enactment of this Act to the date ‘‘September 

30, 2002’’. Sec. 547, ‘‘Landmines’’ is modified by deleting the change in permanent law that was contained in the proviso. 

Sec. 551, ‘‘Caribbean Basin’’ is a new general provision that incorporates sec. 554 of the fiscal year 2002 Act and provides bilateral economic assistance of not less than the following amounts: 

Haiti (including food aid managed by USAID)—$52,500,000; Honduras—$40,130,000 and Nicaragua—$37,680,000.

Sec. 555, ‘‘Assistance for the Middle East’’ is similar to Section 

558 of the fiscal year 2002 appropriations act and is modified by 

raising the cap on Middle East spending from $5,141,150,000 to 

$5,466,700,000. 

Sec. 557, ‘‘Cambodia’’ is modified by deleting the requirement for 

a determination and report by the Secretary of State, a reference 

to the Ministry of Women and Veteran’s Affairs, and a requirement 

for a determination and certification by the President regarding a 

tribunal; funding under the Child Survival and Health Programs 

Fund is authorized for Cambodia. 

Sec. 559, ‘‘Korean Peninsula Energy Development Organization’’ is revised by reducing the funding ceiling from $95,000,000 to 

$50,000,000 and modifying the presidential waiver. 

Sec. 560, ‘‘Palestinian Statehood’’ is a new general provision replacing section 566 from the fiscal year 2002 appropriations act, 

‘‘PLO Compliance Report’’ which is deleted. This provision prohibits 

United States assistance for a Palestinian state unless certain conditions are met regarding democratic reform and cessation of terrorism, but allows technical assistance to Palestinian institutions 

to meet those goals without contravening the restriction on direct 

assistance to the Palestinian Authority. 

Sec. 562, ‘‘Iraq’’ is modified by removing all of the provisos. 

Sec. 563, ‘‘West Bank and Gaza Program’’ is revised by the addition of two new subsections relating to vetting of individuals or entities and to annual audits under the oversight of USAID of all contractors and grantees; in addition, up to $1,000,000 from the Economic Support Fund may be used by the USAID Office of the Inspector General for such audits. 

Sec. 564, ‘‘Indonesia’’ is modified by limiting its application to 

funds appropriated under the heading ‘‘Foreign Military Financing 

Program’’. 

Sec. 566, ‘‘Restrictions on Assistance to Governments Destabilizing Sierra Leone’’ is similar to section 574 of the fiscal year 

2002 appropriations act and is modified by deleting initial subsection. 

Sec. 568, ‘‘Contributions to the United Nations Population Fund’’

is identical except for technical date changes to section 585 of the 

fiscal year 2001 Act with two modifications: it deletes the term ‘‘not 

more than’’ before the dollar amount; and it adds a new condition 

on availability of funds to UNFPA—that the UNFPA does not proVerDate Sep 04 2002 01:55 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00080 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.006 HR663
81

vide any funding for China’s State Planned-Birth Commission or 

its regional affiliates. 

Sec. 573, ‘‘Funding for Yugoslavia’’ is modified by replacing ‘Serbia’ with ‘Yugoslavia’ or ‘Central Government of the Federal Republic of Yugoslavia’ where the former term was used in the title 

or subsection (a) of section 584 of the fiscal year 2002 Act; also, 

subsection (d) deletes references to Montenegro, Kosovo and municipalities. 

Sec. 574, ‘‘Prohibition on Taxation of United States Assistance’’ is a new general provision that requires the Secretary of State to 

insert in new bilateral assistance agreements a requirement that 

United States assistance is exempt from taxation or that tax collected is promptly reimbursed. 

Sec. 575, ‘‘Prohibition on Use of Multilateral Assistance to Support Terrorism’’ is a new general provision relating to compliance, 

especially by the Department of State and United Nations Relief 

and Works Agency for Palestine Refugees in the Near East, with 

section 301(c) of the Foreign Assistance Act. 

Sec. 576, ‘‘Colombia’’ is similar to Section 567 of the fiscal year 

2002 appropriations act and is modified to require the Secretary of 

State to determine and certify that the Colombian Armed Forces 

are meeting certain human rights conditions before all the funds 

for the Colombian Armed Forces are made available.

Sec. 578, ‘‘Burma’’ is a new general provision replacing language 

carried under that heading in title II of the fiscal year 2002 Act; 

subsection (a) is identical, except for updated dollar amounts, to 

language enacted in the fiscal year 1977 appropriations act; subsection (b) provides that not less than $2,000,000 should be made 

available from the Child Survival and Health Programs Fund for 

Burma. 

Sec. 579, ‘‘Tropical Forest Conservation’’ is a new general provision requested by the President making available from the Development Assistance account $50,000,000 to carry out tropical forest 

conservation activities, of which up to $40,000,000 may be used for 

the subsidy cost of debt reduction authorized by the Tropical Forest 

Conservation Act of 1998. 

Sec. 580, ‘‘Authorizations’’ is similar to Section 588 of the fiscal 

year 2002 appropriations act and authorizes the Secretary of Treasury to make contributions to certain multilateral development 

banks. 

Sec. 581, ‘‘Cuba’’ is a new general provision prohibiting counternarcotics assistance in this Act to the Government of Cuba. 

Sec. 582, ‘‘Trade Capacity Building’’ is a new general provision providing that not less than $452,000,000 from five specified accounts should be made available for trade capacity building assistance. 

PROVISIONS RETAINED FROM FISCAL YEAR 2002

The following general provisions from the fiscal year 2002 Act 

are retained in the fiscal year 2003 Act unchanged except for technical corrections, references to fiscal year 2003, and new section 

numbers where appropriate: 

Sec. 501. Obligations During Last Month of Availability. 

Sec. 502. Private and Voluntary Organizations. 

Sec. 503. Limitation on Residence Expenses. 

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Sec. 504. Limitation on Expenses. 

Sec. 505. Limitation on Representational Allowances. 

Sec. 506. Prohibition on Financing Nuclear Goods.

Sec. 507. Prohibition Against Direct Funding for Certain Countries. 

Sec. 508. Military Coups. 

Sec. 510. Deobligation/Reobligation Authority. 

Sec. 511. Availability of Funds. 

Sec. 513. Commerce and Trade. 

Sec. 514. Surplus Commodities. 

Sec. 515. Notification Requirements. 

Sec. 516. Limitation on Availability of Funds for International 

Organizations and Programs. 

Sec. 517. Independent States of the Former Soviet Union. 

Sec. 518. Prohibition on Funding for Abortions and Involuntary 

Sterilization. 

Sec. 519. Export Financing Transfer Authorities. 

Sec. 521. Definition of Program, Project, and Activity. 

Sec. 524. Notification of Excess Defense Equipment. 

Sec. 525. Authorization Requirement. 

Sec. 527. Prohibition on Bilateral Assistance to Terrorist Countries. 

Sec. 529. Separate Accounts. 

Sec. 530. Compensation for United States Executive Directors to 

International Financial Institutions. 

Sec. 531. Compliance with United Nations Sanctions against 

Iraq. 

Sec. 532. Authorities for the Peace Corps, Inter-American Foundation and African Development Foundation. 

Sec. 533. Impact on Jobs in the United States. 

Sec. 535. Policy on Terminating the Arab League Boycott of 

Israel and Normalizing Relations with Israel. 

Sec. 536. Administration of Justice Activities. 

Sec. 537. Eligibility for Assistance.

Sec. 539. Ceilings and Earmarks. 

Sec. 540. Prohibition on Publicity and Propaganda. 

Sec. 541. Prohibition of Payments to United Nations Members. 

Sec. 542. Nongovernmental Organizations—Documentation. 

Sec. 543. Prohibition on Assistance to Foreign Governments that 

Export Lethal Military Equipment to Countries Supporting International Terrorism. 

Sec. 545. Limitation on Assistance for the PLO for the West 

Bank and Gaza. 

Sec. 546. War Crimes Tribunals Drawdown. 

Sec. 548. Restrictions Concerning the Palestinian Authority. 

Sec. 549. Prohibition of Payment of Certain Expenses. 

Sec. 550. Restrictions on Voluntary Contributions to United Nations Agencies. 

Sec. 552. Limitation on Assistance to the Palestinian Authority. 

Sec. 553. Limitation on Assistance to Security Forces. 

Sec. 554. Discrimination Against Minority Religious Faiths in the 

Russian Federation. 

Sec. 556. Enterprise Fund Restrictions. 

Sec. 558. Foreign Military Training Report. 

83

Sec. 561. Prohibition on Assistance to the Palestinian Broadcasting Corporation. 

Sec. 565. Briefings on Potential Purchases of Defense Articles or 

Defense Services by Taiwan. 

Sec. 567. Voluntary Separation Incentives. 

Sec. 569. Procurement and Financial Management Reform. 

Sec. 570. Commercial Leasing of Defense Articles. 

Sec. 571. War Criminals. 

Sec. 572. User Fees. 

Sec. 577. Illegal Armed Groups. 

Sec. 583. American Churchwomen and Other Citizens in El Salvador and Guatemala. 

HOUSE OF REPRESENTATIVES REPORT REQUIREMENTS

TRANSFER OF FUNDS

Pursuant to clause 3(f)(2) of rule XIII of the Rules of the House 

of Representatives, the following is submitted describing the transfer of funds provided in the accompanying bill. 

Under ‘‘Child Survival and Health Programs Fund’’ up to 

$6,000,000 may be transferred to and merged with funds appropriated under the heading ‘‘Operating Expenses of the United 

States Agency for International Development.’’

Under ‘‘Development credit authority’’ up to $24,500,000 is authorized to be transferred to the account from a variety of sources. 

In addition, $7,591,000 may be transferred to and merged with 

funds appropriated under the heading ‘‘Operating Expenses of the 

United States Agency for International Development’’. 

Under ‘‘Economic Support Fund’’, up to $200,000,000 may be 

transferred to ‘‘Nonproliferation, Antiterrorism, Demining and Related Programs’’. 

Under ‘‘Foreign Military Financing Program’’, up to $98,000,000 

may be transferred to ‘‘International Narcotics Control and Law 

Enforcement’’. 

RESCISSIONS

Clause 3(f)(2) of rule XIII of the Rules of the House of Representatives requires a separate listing of rescissions. There are no rescissions recommended in the accompanying bill. 

CONSTITUTIONAL AUTHORITY

Clause 3(d)(1) of rule XIII of the Rules of the House of Representatives states that:

Each report of a committee on a bill or joint resolution 

of a public character, shall include a statement citing the 

specific powers granted to the Congress in the Constitution 

to enact the law proposed by the bill or joint resolution.

The Committee on Appropriations bases its authority to report 

this legislation from Clause 7 of Section 9 of Article I of the Constitution of the United States of America which states:

No money shall be drawn from the Treasury but in consequence of Appropriations made by law * * *

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Appropriations contained in this Act are made pursuant to this 

specific power granted by the Constitution. 

CHANGES IN THE APPLICATION OF EXISTING LAW

Pursuant to clause 3(f), rule XIII of the Rules of the House of 

Representatives, the following statements are submitted describing 

the effects of provisions in the accompanying bill which directly or 

indirectly change the application of existing law. Most of the language has been provided in previous measures including 

supplementals for the departments and agencies carried in the accompanying bill. 

1. The bill contains appropriations for a number of items for 

which authorizations for fiscal year 2002 have not yet been enacted. The bill allows funds appropriated in the bill to be obligated 

in the absence of a prior authorization of appropriations.

2. The bill provides that a number of the appropriations shall remain available for obligation beyond the current fiscal year. In all 

cases it is deemed desirable to carry such language in order to provide for orderly administration of such programs and effective use 

of funds. 

3. The bill contains a number of general provisions and other 

language that have been carried in the bill in past years. 

4. Under ‘‘Export-Import Bank of the United States, Administrative Expenses’’, authority is provided for the Export-Import Bank 

to accept and use payment or services provided by transaction participants for legal, financial, or technical services in connection 

with any transaction for which an application for a loan, guarantee 

or insurance commitment has been made. In addition, authority is 

provided for subsection (a) of section 117 to remain in effect until 

October 1, 2003. 

5. Under ‘‘Overseas Private Investment Corporation, Program 

Account’’, funds are appropriated for the cost of direct and guaranteed loans, to be derived by transfer from the Overseas Private Investment Corporation Noncredit Account. Such costs shall be as defined in section 502 of the Congressional Budget Act of 1974 and 

may be used for direct loan and loan guaranty commitments incurred or made during fiscal years 2003 and 2004. These funds are 

available for obligation until 2011 and 2012, depending on the initial date of obligation. 

6. Under ‘‘Trade and Development Agency’’, an additional 

$5,000,000 is made available for trade capacity building assistance 

and is subject to notification. 

7. Under ‘‘Child Survival and Health Programs Fund’’ language 

is provided that indicates how the funds should be allocated among 

various activities; not to exceed $32,500, in addition to funds otherwise available for such purposes, may be used to monitor and provide oversight of programs for displaced and orphaned children and 

victims of war; up to $60,000,000 is authorized to be made available for a contribution to The Vaccine Fund; and language is included that provides that not less than $250,000,000 should be 

made available for a contribution to the Global Fund to Fight 

AIDS, Tuberculosis and Malaria, and shall be expended at the minimum rate necessary to make timely payments for projects and activities, and may not exceed the total resources provided by other 

donors; and limitations are placed on transfers to other agencies. 

85

8. Under ‘‘Development Assistance’’, language is provided that indicates how the funds should be allocated among various activities, 

including $162,500,000 for trade capacity building and 

$218,000,000 for basic education; and language is included that 

provides that none of the funds appropriated under title II of this 

Act that are managed by or allocated to the United States Agency 

for International Development Secretariat may be made available 

except through the regular notification procedures of the Committees on Appropriations. 

9. Under ‘‘International Disaster Assistance’’, $50,000,000 is provided for the West Bank and Gaza, to remain available until expended, and language provides that none of the funds appropriated 

for this purpose may be obligated or expended with respect to providing funds to the Palestinian Authority, and $65,000,000 is made 

available for Afghanistan for certain specified purposes. 

10. Under ‘‘Development Credit Authority’’, authorized transfers, 

when added to the funds transferred pursuant to the authority contained under this heading in Public Law 107–115, shall not exceed 

$24,500,000. 

11. Under ‘‘Capital Investment Fund’’, language is provided establishing this new account pursuant to the authority of section 

667 of the Foreign Assistance Act, for expenses for overseas construction and related costs, and for the procurement and enhancement of information technology and related capital investments; 

such appropriations are in addition to those otherwise available for 

such purposes; the Administrator of USAID is authorized to change 

fair and reasonable rent in buildings constructed using funds appropriated under this heading, and such rental payments are designated as offsetting collections; obligations of funds (including offsetting collections) are subject to notification; and the assignment 

of employees or contractors to buildings is subject to the concurrence of the Administrator of USAID. 

12. Under ‘‘Economic Support Fund’’, not less than $600,000,000 

is made available only for Israel and not less than $615,000,000 is 

made available only for Egypt; not less than $45,000,000 is made 

available for Afghanistan for certain specified purposes; not less 

than $35,000,000 should be available for Lebanon; and not less 

than $15,000,000 should be available for Cyprus. In addition, 

$200,000,000 is provided for Israel for certain specified purposes 

with discretionary transfer authority. 

13. Under ‘‘Assistance for Eastern Europe and the Baltic States’’, 

not less than $5,000,000 should be made available for assistance 

for the Baltic States. 

14. Under ‘‘Assistance for the Independent States of the Former 

Soviet Union’’, the Committee has modified limitations on the 

amount of assistance that may be made available for various countries, and the limitations for Georgia and Armenia apply to funds 

appropriated in this title rather than under this heading, as in current law; in addition, no funds are available for the Government of 

Ukraine if the Secretary of State cannot certify that it is in compliance with certain specified conditions, subject to several specified 

exceptions. 

15. Under ‘‘African Development Foundation’’, funds made available to grantees may be invested for project purposes when authorVerDate Sep 04 2002 03:50 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00085 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.006 HR663
86

ized by the Board of Directors, instead of by the President as in 

current law. 

16. Under ‘‘Peace Corps’’, the Director of the Peace Corps is allowed to make appointments to permit Peace Corps employees to 

serve in excess of five years in the case of individuals whose appointment involves the safety of Peace Corps volunteers, notwithstanding section 7 of the Peace Corps Act. 

17. Under ‘‘International Narcotics Control and Law Enforcement’’, $10,000,000 should be made available for the demand reduction program; in addition, a limitation of $24,062,000 is placed 

on administrative expenses.

18. Under ‘‘Andean Counterdrug Initiative’’, assistance for Colombia is made available consistent with the provisions authorizing 

and limiting such assistance as are contained in Public Law 107– 206; the Secretary of State, in consultation with the Administrator 

of USAID, shall provide to the Committee 45 days after the date 

of enactment a report on the proposed uses of all funds under this 

heading on a country-by-country basis for each proposed program, 

project or activity; in addition, a limitation of $15,680,000 is placed 

on administrative expenses. 

19. Under ‘‘Migration and Refugee Assistance’’, a limitation of 

$16,000,000 is placed on administrative expenses. 

20. Under ‘‘Nonproliferation, Anti-terrorism, Demining, and Related Programs’’, a limitation of $15,000,000 is placed on funding 

for the Nonproliferation and Disarmament Fund. 

21. Under ‘‘International Military Education and Training’’, assistance for Guatemala is limited to expanded military education 

and training and is subject to notification. 

22. Under ‘‘Foreign Military Financing Program’’, authority is provided for the transfer of up to $98,000,000 to ‘‘International 

Narcotics Control and Law Enforcement’’ and no other funds may 

be made available for certain assistance for Colombia; not less than 

$2,100,000,000 is appropriated for Israel, of which not less than 

$550,000,000 shall be available for the procurement in Israel of defense articles and defense services; a limitation of $38,000,000 is 

provided for administrative expenses; and a limitation of 

$356,000,000 from certain other funds may be obligated for expenses incurred pursuant to section 43(b) of the Arms Export Control Act.

23. Under title IV, funds for a number of international financial 

institutions are made available for contributions; funds are made 

available for the United States share of the paid-in portion of the 

increase in capital stock of certain institutions; and limitations are 

placed on callable capital subscriptions. 

24. Under ‘‘Contribution to the Enterprise for the Americas Multilateral Investment Fund’’, authority is given for the Secretary of 

the Treasury to make a payment to the Multilateral Investment 

Fund, to remain available until expended; this account was not 

contained in the 2002 appropriations act. 

25. Under ‘‘General Provisions’’: 

Sec. 509, ‘‘Transfers Between Accounts’’ is modified by adding 

two new subsections: prohibiting transfers of funds made available 

by this Act other than those transfers provided for by this Act, any 

other appropriations Act, or sections 109, 610 and 632 of the Foreign Assistance Act of 1961; and requiring the inspectors general 

87

of agencies in receipt of transfers of funds provided by this Act to 

perform and make available to the Committee periodic program 

and financial audits of the use of such funds. 

Sec. 512, ‘‘Limitation on Assistance to Countries in Default’’ is 

modified by narrowing the application of the limitation to assistance to the government of any country in default. 

Sec. 520, ‘‘Special Notification Requirements’’ is modified to delete Serbia and Haiti. 

Sec. 522, ‘‘Child Survival and Health Activities’’ is revised by re- ducing from $15,500,000 to $11,000,000 the amount from the Child 

Survival and Health Program Fund that may be used to reimburse 

other agencies, institutions and private organizations for the full 

cost of individual USAID staff who would otherwise be compensated from the USAID Operating Expenses account; by increasing from $3,000,000 to $3,500,000 the amount of Development Assistance funds that may be used for similar reimbursements relating to operating expenses for administration of basic education activities; and by deleting the requirement that $446,000,000 shall be 

made available for family planning/reproductive health. 

Sec. 523, ‘‘Afghanistan’’ is a new general provision providing that not less than $295,500,000 shall be provided for humanitarian and 

reconstruction activities in Afghanistan, of which not less than 

$2,500,000 should be for women’s centers. 

Sec. 526, ‘‘Democracy Programs’’ is modified by deleting language providing that not less than $10,000,000 shall be made available 

for democracy activities in China, but retaining a ceiling of 

$3,000,000 for certain activities in Tibet that are undertaken by 

nongovernmental organizations incorporated outside of China; it 

also modifies a provision regarding democracy, rule of law, and 

women’s development programs in countries with a significant 

Muslim population by deleting the minimum funding level and all 

references to the Bureau of Democracy, Human Rights and Labor, 

Department of State. 

Sec. 528, ‘‘Debt-for-Development’’ is modified by limiting its application to debt exchanges and deleting references to endowment 

and economic assistance activities. 

Sec. 534, ‘‘Special Authorities’’ is revised by: in subsection (a) expanding its application to all assistance to Afghanistan and modifying restrictions on assistance for Cambodia; in subsection (c) by 

reducing the number of additional USAID personal service contractors in the United States from 25 to 15 and limiting their temporary deployment to the offices of Procurement and of Food for 

Peace and the bureaus for Africa and for Asia and the Near East; 

and by adding a new subsection (g) that extends an additional year 

certain authorities contained in section 602 of Public Law 107–206 

regarding the shipment of humanitarian assistance that applied 

only during fiscal year 2002. 

Sec. 538, ‘‘Earmarks’’ is modified in subsection (a) by replacing 

the word ‘‘impossible’’ with the words ‘‘not possible’’. 

Sec. 544, ‘‘Withholding of Assistance for Parking Fines Owed by 

Foreign Countries’’ is modified in subsection (a) by changing a reference to the date of enactment of this Act to the date ‘‘September 

30, 2002’’. 

Sec. 547, ‘‘Landmines’’ is modified by deleting the change in permanent law that was contained in the proviso. 

88

Sec. 551, ‘‘Caribbean Basin’’ is a new general provision that incorporates sec. 554 of the fiscal year 2002 Act and provides bilateral economic assistance of not less than the following amounts: 

Haiti (including food aid managed by USAID)—$52,500,000; Honduras—$40,130,000 and Nicaragua—$37,680,000. 

Sec. 555, ‘‘Assistance for the Middle East’’ is similar to section 

558 of the fiscal year 2002 appropriations act and is modified by 

raising the cap on Middle East spending from $5,141,150,000 to 

$5,466,700,000. 

Sec. 557, ‘‘Cambodia’’ is modified by deleting the requirement for 

a determination and report by the Secretary of State, a reference 

to the Ministry of Women and Veteran’s Affairs, and a requirement 

for a determination and certification by the President regarding a 

tribunal. 

Sec. 559, ‘‘Korean Peninsula Energy Development Organization’’ is revised by reducing the funding ceiling from $95,000,000 to 

$50,000,000 and modifying the presidential waiver. 

Sec. 560, ‘‘Palestinian Statehood’’ is a new provision that prohibits United States assistance for a Palestinian state unless certain conditions are met regarding democratic reform and cessation 

of terrorism, but allows technical assistance to Palestinian institutions to meet those goals without contravening the restriction on 

direct assistance to the Palestinian Authority. 

Sec. 562, ‘‘Iraq’’ is modified by removing all of the provisos. 

Sec. 563, ‘‘West Bank and Gaza Program’’ is revised by the addition of two new subsections relating to vetting of individuals or entities and to annual audits under the oversight of USAID of all contractors and grantees; in addition, up to $1,000,000 from the Economic Support Fund may be used by the USAID Office of the Inspector General for such audits. 

Sec. 564, ‘‘Indonesia’’ is modified by limiting its application to 

funds appropriated under the heading ‘‘Foreign Military Financing 

Program’’. Sec. 566, ‘‘Restrictions on Assistance to Governments Destabilizing Sierra Leone’’ is similar to section 574 of the fiscal year 

2002 appropriations act and is modified by deleting initial subsection. 

Sec. 568, ‘‘Contributions to the United Nations Population Fund’’

is identical except for technical date changes to section 585 of the 

fiscal year 2001 Act with two modifications: it deletes the term ‘‘not 

more than’’ before the dollar amount; and it adds a new condition 

on availability of funds to UNFPA—that the UNFPA does not provide any funding for China’s State Planned-Birth Commission or 

its regional affiliates. 

Sec. 573, ‘‘Funding for Yugoslavia’’ is modified by replacing ‘Serbia’ with ‘Yugoslavia’ or ‘Central Government of the Federal Republic of Yugoslavia’ where the former term was used in the title 

or subsection (a) of section 584 of the fiscal year 2002 Act; also, 

subsection (d) deletes references to Montenegro, Kosovo and municipalities. 

Sec. 574, ‘‘Prohibition on Taxation of United States Assistance’’

is a new general provision that requires the Secretary of State to 

insert in new bilateral assistance agreements a requirement that 

United States assistance is exempt from taxation or that tax that 

was collected is promptly reimbursed. 

89

Sec. 575, ‘‘Prohibition on Use of Multilateral Assistance to Support Terrorism’’ is a new general provision relating to compliance, 

especially by the Department of State and United Nations Relief 

and Works Agency for Palestine Refugees in the Near East, with 

section 301(c) of the Foreign Assistance Act. 

Sec. 576, ‘‘Colombia’’ is similar to section 561 of the fiscal year 

2002 appropriations act and is modified to require the Secretary of 

State to determine and certify that the Colombian Armed Forces 

are meeting certain human rights conditions before all the funds 

for the Colombian Armed Forces are made available.

Sec. 578, ‘‘Burma’’ is a new general provision replacing language 

carried under that heading in title II of the fiscal year 2002 Act; 

subsection (a) is identical, except for updated dollar amounts, to 

language enacted in the fiscal year 1997 Act; subsection (b) provides that not less than $2,000,000 should be made available from 

the Child Survival and Health Programs Fund for Burma. 

Sec. 579, ‘‘Tropical Forest Conservation’’ is a new general provision requested by the President making available from the Development Assistance account $50,000,000 to carry out tropical forest 

conservation activities, of which up to $40,000,000 may be used for 

the subsidy cost of debt reduction authorized by the Tropical Forest 

Conservation Act of 1998. 

Sec. 580, ‘‘Authorizations’’ is similar to section 588 of the fiscal 

year 2002 appropriations act and authorizes the Secretary of Treasury to make contributions to certain multilateral development 

banks. 

Sec. 581, ‘‘Cuba’’ prohibits counternarcotics assistance in this Act 

to the Government of Cuba. 

Sec. 582, ‘‘Trade Capacity Building’’ is a new general provision providing that not less than $452,000,000 from five specified accounts should be made available for trade capacity building assistance. 

APPROPRIATIONS NOT AUTHORIZED BY LAW

Pursuant to clause 3(f)(1) of rule XIII of the Rules of the House 

of Representatives, the following table lists the appropriations in 

the accompanying bill which, in whole or in part, are not authorized by law:

Last year authorized Authorization level Appropriations in last year of authorization Appropriations in this 

Export-Import Bank .................................... 2001 ....................................................... Such sums as may be necessary ......... $865,000,000 ......................................... $541,400,000Export-Import Bank administrative expenses. 2001 ....................................................... Such sums as may be necessary ......... $62,000,000 ........................................... $68,300,000

Child Survival and Health Programs Fund 

(See note below).

Population (1987); Health and Disease 

Prevention (1987); Child Survival Fund (1987); HIV/AIDS (2002).

Population ($290,000,000); Health and 

Disease Prevention ($180,000,000); Child Survival Fund ($75,000,000); HIV/AIDS ($300,000,000).

Population ($234,625,000); Health and 

Disease Prevention ($166,762,500); Child Survival Fund ($75,000,000); HIV/AIDS ($474,000,000 in fy2002 recommendation, of which $434,000,000 in this account).

$1,710,000,000 (includes $4

for population, of which $368,500,000 in this accoing for other programs, otHIV/AIDS, difficult to deteto changing definitions of since last authorized) 

Development Assistance (See note below) Agriculture (1987); Education (1987); 

Energy and selected development activities (1987).

Agriculture ($760,000,000); Education 

($180,000,000); Energy and selected development activities ($207,000,000).

Agriculture ($639,613,000); Education 

($155,000,000); Energy and selected development activities ($149,990,000).

$1,398,000,000 (includes $2

for basic education, of wh$218,000,000 in this accoprograms difficult to deteto changing definitions of since last authorized) 

International Disaster Assistance .............. 1987 ....................................................... $25,000,000 ........................................... $70,000,000 ........................................... $315,500,000Transition initiatives .................................. None (same authorities as international 

disaster assistance).

................................................................ ................................................................ $40,000,000

Development credit authority ..................... None ....................................................... ................................................................ ................................................................ ($12,500,000) Development credit authority administrative expenses. None ....................................................... ................................................................ ................................................................ $7,591,000Payment to the Foreign Service Retirement 

and Disability Fund.

None; mandatory item ........................... ................................................................ ................................................................ $45,200,000

Operating expenses of the United States 

Agency for International Development.

1987 ....................................................... $387,000,000 ......................................... $340,600,000 ......................................... $572,200,000

Capital Investment Fund ........................... None ....................................................... ................................................................ ................................................................ $43,000,000Operating Expenses of the United States 

Agency for International Development Inspector General.

1987 ....................................................... $21,750,000 ........................................... $21,000,000 ........................................... $33,700,000

Economic Support Fund ............................. 1987 ....................................................... $3,800,000,000 ...................................... $3,555,000,000 ...................................... $2,445,000,000International Fund for Ireland ................... 1988 ....................................................... $35,000,000 ........................................... $35,000,000 ........................................... $25,000,000Assistance for Eastern Europe and the 

Baltic States (See note below).

None ....................................................... ................................................................ ................................................................ $520,000,000

Assistance for the Independent States of 

the Former Soviet Union.

1993 ....................................................... $410,000,000 ......................................... $417,000,000 ......................................... $755,000,000

Inter-American Foundation ......................... 1987 ....................................................... $11,969,000 ........................................... $11,800,000 ........................................... $16,000,000

African Development Foundation ............... 1987 ....................................................... $3,872,000 ............................................. $6,500,000 ............................................. $19,689,000International Narcotics Control and Law 

Enforcement.

1994 ....................................................... $171,500,000 ......................................... $100,000,000 ......................................... $197,000,000

Andean Counterdrug Initiative ................... None ....................................................... ................................................................ ................................................................ $731,000,000Migration and Refugee Assistance ............ 2001 ....................................................... $750,000,000 ......................................... $700,000,000 ......................................... $800,000,000Nonproliferation, Anti-terrorism, demining 

and related programs (See note below).

None ....................................................... ................................................................ ................................................................ $347,400,000

International Affairs Technical Assistance 1999 ....................................................... $5,000,000 ............................................. $1,500,000 ............................................. $11,000,000Foreign Military Financing Program ........... 2002 ....................................................... $3,627,000,000 ...................................... $4,007,000,000 ...................................... $4,080,200,000International Military Education and 

Training.

2002 ....................................................... $65,000,000 ........................................... $70,000,000 ........................................... $80,000,000

Peacekeeping operations ............................ 1999 ....................................................... $83,000,000 ........................................... $76,500,000 ........................................... $125,000,000International Development Association ...... ................................................................ $2,410,000,000 over three years (beginning in fy2000). $792,400,000 ......................................... $874,338,333

African Development Fund ......................... ................................................................ $300,000,000 over three years (beginning in fy2000). $100,000,000 ......................................... $113,073,333

Asian Development Fund ........................... 2001 ....................................................... $400,000,000 over four years (beginning in fy1998). $72,000,000 ........................................... $97,886,000

International Organizations and Programs 2001 ....................................................... Such sums as may be necessary ......... $186,000,000 ......................................... $190,400,000

Note.—Programs recommended herein under ‘‘Child Survival and Health Programs Fund’’ and ‘‘Development Assistance’’ were last authorized under a different account structure than that recommended in this bill; the account 

cluded a number of functional accounts, as described above. 

Note.—Programs recommended herein under ‘‘Support for Eastern Europe and the Baltic States’’ were last authorized in the Support for East European Democracy (SEED) Act of 1989; however, these funds were authorized for 

grams and not for the account as a whole. In fiscal year 1991, the first general appropriations act after enactment of the SEED Act included $369,675,000 for this account. 

Note.—Programs recommended herein under ‘‘Nonproliferation, Anti-terrorism, Demining, and Related Programs’’ include some major programs for which authorizations of appropriations were provided for fiscal year 2002; these 

clude $73,000,000 authorized for anti-terrorism assistance and $142,000,000 authorized for nonproliferation activities. In addition, some programs now in this account were previously in accounts which had authorizations of appprior years. 

92

COMPARISON WITH BUDGET RESOLUTION

Clause 3(c)(2) of rule XIII of the Rules of the House of Representatives requires an explanation of compliance with section 

308(a)(1)(A) of the Congressional Budget and Impoundment Control 

Act of 1974 (Public Law 93–344), as amended, which requires that 

the report accompanying a bill providing new budget authority contain a statement detailing how the authority compares with the reports submitted under section 302 of the Act for the most recently 

agreed to concurrent resolution on the budget for the fiscal year 

from the Committee’s section 302(a) allocation.

[In millions of dollars] 

302(b) allocation— This bill—

Budget

authority Outlays Budgetauthority Outlays 

Discretionary .................................................................................. $16,550 16,571 16,549 16,568

Mandatory ...................................................................................... 45 45 45 45

FIVE-YEAR OUTLAY PROJECTIONS

In compliance with section 308(a)(1)(B) of the Congressional 

Budget and Impoundment Control Act of 1974 (Public Law 93–

344), as amended, the following table contains five-year projections 

associated with the budget authority provided in the accompanying 

bill:

Fiscal year 2003 .................................................................................. 5,963

Fiscal year 2004 .................................................................................. 5,516

Fiscal year 2005 .................................................................................. 2,713

Fiscal year 2006 .................................................................................. 1,082

Fiscal year 2007 .................................................................................. 1,050

STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES

Pursuant to clause 3(c)(4) of rule XIII of the Rules of the House 

of Representatives, the following is a statement of general performance goals and objectives for which this measure authorizes funding: 

The Committee on Appropriations considers program performance, including a program’s success in developing and attaining 

outcome-related goals and objectives, in developing funding recommendations. 

ASSISTANCE TO STATE AND LOCAL GOVERNMENTS

In accordance with section 308(a)(1)(C) of the Congressional 

Budget and Impoundment Control Act of 1974 (Public Law 93–

344), as amended, the financing assistance to State and local governments is as follows: 

The amounts recommended in the accompanying bill contain no 

budget authority or budget outlays for State or local governments. 

COMPLIANCE WITH RULE XIII, CL. 3(e) (RAMSEYER RULE) 

In compliance with clause 3(e) of rule XIII of the Rules of the 

House of Representatives, changes in existing law made by the bill, 

as reported, are shown as follows (existing law proposed to be omitVerDate Sep 04 2002 01:55 Sep 20, 2002 Jkt 081786 PO 00000 Frm 00092 Fmt 6659 Sfmt 6602 E:\HR\OC\HR663.007 HR663
93

ted is enclosed in black brackets, new matter is printed in italic, 

existing law in which no change is proposed is shown in roman): 

SECTION 579 OF THE FOREIGN OPERATIONS, EXPORT 

FINANCING, AND RELATED PROGRAMS APPROPRIATIONS ACT, 2000

VOLUNTARY SEPARATION INCENTIVES FOR EMPLOYEES OF THE UNITED

STATES AGENCY FOR INTERNATIONAL DEVELOPMENT

SEC. 579. (a) * * *

* * * * * * *

(c) AUTHORITY TO PROVIDE VOLUNTARY SEPARATION INCENTIVE

PAYMENTS.—

(1) * * *

(2) AMOUNT AND TREATMENT OF PAYMENTS.—A voluntary 

separation incentive payment under this section—

(A) * * *

* * * * * * *

(D) may not be made except in the case of any employee 

who voluntarily separates (whether by retirement or resignation) on or before øDecember 31, 2002¿ December 31, 

2003; 

* * * * * * *

94

FULL COMMITTEE VOTES

Pursuant to the provisions of clause 3(b) of rule XIII of the House 

of Representatives, the results of each rollcall vote on an amendment or on the motion to report, together with the names of those 

voting for and those voting against, are printed below: 

ROLLCALL NO. 1

Date: September 12, 2002. 

Measure: Foreign Operations, Export Financing, and Related 

Programs Appropriations Act, FY 2003. 

Motion by: Mr. Hoyer. 

Description of motion: To modify section 573 of the bill pertaining to funding for Yugoslavia, to apply the restrictions of that 

section to all funds to be made available for Serbia after March 31, 

2003, rather than funds to be made available to the Central Government of the Federal Republic of Yugoslavia; and to include exemptions from the restrictions for assistance for Montenegro and 

Kosovo, as well as for assistance to promote democracy in municipalities. 

Results: Rejected 15 yeas to 30 nays. 

Members Voting Yea Members Voting Nay 

Ms. DeLauro Mr. Aderholt 

Mr. Edwards Mr. Callahan 

Mr. Farr Mr. Cunningham 

Mr. Hinchey Mr. Doolittle 

Mr. Hoyer Mrs. Emerson 

Mr. Kennedy Mr. Frelinghuysen 

Mrs. Lowey Mr. Goode 

Mr. Moran Ms. Granger 

Mr. Obey Mr. Hobson 

Mr. Olver Mr. Istook 

Mr. Price Mr. Kingston 

Mr. Rothman Mr. Knollenberg 

Ms. Roybal-Allard Mr. Kolbe 

Mr. Sabo Mr. LaHood 

Mr. Serrano Mr. Lewis 

Mr. Miller 

Mr. Nethercutt 

Mrs. Northup 

Mr. Regula 

Mr. Rogers 

Mr. Sherwood 

Mr. Skeen 

Mr. Sweeney 

Mr. Tiahrt 

Mr. Vitter 

Mr. Walsh 

Mr. Wamp 

Mr. Wicker 

Mr. Wolf 

Mr. Young

95


Insert offset folio 109 here HR663.001
96


Insert offset folio 110 here HR663.002
97


Insert offset folio 111 here HR663.003
98


Insert offset folio 112 here HR663.004
99


Insert offset folio 113 here HR663.005
100


Insert offset folio 114 here HR663.006
101


Insert offset folio 115 here HR663.007
102


Insert offset folio 116 here HR663.008
(103)

ADDITIONAL VIEWS OF HON. NITA M. LOWEY 

While I believe that the FY 2003 Foreign Operations bill represents a reasonable, bipartisan compromise, there are several 

areas of disagreement that need comment. I commend the Chairman for working with me and for accommodating most of my priorities. I intend to work diligently with him, but will seek necessary 

changes as this bill moves through the House floor and to Conference. 

The bill provides a total of $16.59 billion, more than $1.2 billion 

above the FY 2002-enacted level. We have achieved a significant 

increase in overall assistance levels in this bill. However, it should 

come as no surprise that I still believe that the U.S. foreign assistance program is underfunded. We must provide enough resources 

to respond to critical national security challenges, including fighting the war on terrorism, rebuilding Afghanistan, combating global 

HIV/AIDS, and reducing poverty. While I support the elements of 

the Administration’s budget amendment request for $350 million, 

it arrived the day before our subcommittee markup, had no offsets 

to pay for it, and came at a point in the process when it was all 

but impossible to secure additions to the Committee’s overall allocation. The Committee had no choice but to take funding from 

other subcommittees to pay for a portion of this request. The budget amendment followed closely on the heels of the President’s decision to reject $5.1 billion in Emergency Supplemental Appropriations, which had included all the elements of this request. 

I am also concerned that the Administration’s proposal for the 

Millennium Challenge Account for FY 2004 will put all new resources into a lump sum account, and not into core development accounts. I want to make clear now that I view these accounts as the 

bread and butter of our programs around the world, and will continue to push for increases in them. 

The bill provides nearly $800 million for HIV/AIDS, an increase 

over the President’s request, and a significant increase over the FY 

2002 level. This total includes $250 million for the Global Fund to 

fight AIDS, Tuberculosis and Malaria, and additional amounts for 

bilateral programs, including mother-to-child transmission and 

treatment and care initiatives. While this may be the best we can 

do under the current allocation, I believe that we should make a 

more dramatic commitment to combating this pandemic. 

I am particularly proud of what we were able to achieve in the 

area of basic education. The Chairman and I worked closely to provide a total of $250 million for these initiatives, a significant increase over last year’s levels, and a 250 percent increase over the 

FY 2001 level. We have also mandated that programs in the Middle East and Central Asia for basic education be increased. 

I have a few other specific concerns. 

104

Despite the ongoing and growing needs for reconstruction in Afghanistan, the Administration has failed to request funding for reconstruction needs there. The United States recently committed to 

fund expensive infrastructure projects and provide Presidential security, which are in addition to pledges made to fund ongoing development programs. Congress added an additional $134 million 

above the President’s request for Afghanistan in the FY 2002 Supplemental bill, but the President rejected this when he failed to 

designate the funding emergency spending. 

The President has committed the U.S. to be the major donor for 

reconstruction of the road network in Afghanistan, which will cost 

at least $260 million, an expense for which there has been no request. The Committee has also been informed that DOD will no 

longer pay security costs for the protection of President Karzai, 

which will add another $50 million to our bill’s obligations. In addition, the government of Afghanistan will incur a deficit in excess 

of $350 million this year, at least half of which remains unfunded 

by international donors. 

While the Administration continues to ignore the needs of Afghanistan, the Committee cannot. The Chairman and I agreed to 

earmark a total of $296 million for these needs. I believe we had 

no option but to designate this funding to meet our commitments, 

and provide real resources in a timely fashion so that reconstruction can continue. We cannot allow OMB’s narrow-mindedness to 

prevent us from providing adequate resources to what should be 

our highest priority. 

The bill before us contains authority to resume full military 

training for Indonesia. In subcommittee, I offered an amendment 

to limit that training to ‘‘Expanded IMET’’ only. This would have 

allowed civilian and military authorities in Indonesia the opportunity to participate in U.S.-sponsored programs to discuss muchneeded reform and military respect for civilian authority, something which is sorely lacking at the moment. The murky circumstances surrounding the recent killing of two American employees of the Freeport Mac Moran mining operation in Papua, and the 

continued detention of an American citizen without U.S. consular 

access, vividly demonstrates the need for a cautious approach to resuming training. It is my intention to offer an amendment when 

the bill reaches the House floor to limit military training for Indonesia. 

With respect to international family planning, I am pleased that 

the bill earmarks funding for the United Nations Population Fund 

(UNFPA), and I appreciate the Chairman’s hard work in crafting 

language laying our clear conditions under which funding to 

UNFPA may resume. The Administration’s recent decision on FY 

2002 funding for UNFPA is fundamentally flawed and violates the 

spirit of the agreement reached on that bill. I believe strongly that 

Congress should earmark a higher level of funding than is currently in the bill, and that we must alter the Kemp-Kasten language in FY 2003. The Senate bill includes $50 million for UNFPA, 

and makes significant changes to Kemp-Kasten, which I support. 

Additionally, I am disappointed that the $425 million provided in 

the bill for bilateral family planning is a cut of $21.5 million from 

105

last year’s enacted level, and that this funding is still subject to the 

Mexico City policy. 

With respect to Colombia, Congress agreed to provide expanded 

authority to furnish counter-terror assistance for Colombia in the 

FY02 Supplemental, provided that the new Colombian President 

committed to us in writing to formulating comprehensive policies 

on combating drugs, reforming the armed forces and increasing 

revenues from within Colombia. Those assurances have not been 

forthcoming. I will therefore reserve judgment on whether I will 

support extending these authorities for 2003. 

Finally, It is my hope that this bill will reach the floor of the 

House of Representatives before Congress adjourns for the year. 

The full House should have the opportunity to work its will, and, 

more importantly, the bill should be enacted into law. It contains 

many new and important programs, the implementation of which 

will be severely hindered by having to operate under a long-term 

continuing resolution.

NITA LOWEY.

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