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a. The latest report was available Feb. 9, 2006, at http://www.fws.gov/endangered/expenditures/reports/FWS%20Endangered%20Species%202004%20Expenditures%20Report.pdf . b. See also Congressional Budget Office, Cost Estimate for H.R. 3824 , available at http://www.cbo.gov/showdoc.cfm?index=6663&sequence=0 , Feb. 9, 2006. Since conservation banks and tax incentives are addressed only in S. 2110 , they will be discussed outside the table to conserve space. Provisions related to conservation banks will be paraphrased and CRS comments arein italics. Page numbers refer to the PDF version of S. 2110 as introduced. Under S. 2110 , a conservation bank is defined as an area of land,water, or other habitat (not necessarily contiguous) that is managed in perpetuity orfor an "appropriate period" under an enforceable legal instrument and for the purposeof conserving and recovering habitat, or an endangered, threatened, or candidatespecies, or a species of special concern (p. 31). The conservation bank definition includes habitat "not necessarilycontiguous," which suggests that a bank could consist of segments of habitat ratherthan a block. Given the importance and benefits of habitat continuity for speciessurvival, some might argue that banks consisting of fragmented portions would haveless value than banks with contiguous habitats. This definition also mentions an"appropriate period" as an alternative to in perpetuity when referring to the lifetimeof the bank. The bill does not identify who will make the determination of anappropriate period or what criteria will be used. Credit is defined as the "unit of currency" of a conservation bank generatedby preserving or restoring habitat in an agreement, and quantified through theconservation values of a species or habitat. Conservation values are to be determinedby the Secretary for each bank and converted into a fixed number of credits (pp.31-32). The definition of credit is written in a way that appears to allow alternativesto money that could be exchanged to pay for the values being purchased out of thebank. There is no indication what those alternatives might be. There is littleguidance on how the Secretary will determine or measure conservation value, andhow much "value" will equal a credit. Due to the changing nature of habitat and thepotential for habitat improvement or degradation, conservation values may changewithin banks. There do not appear to be any provisions that allow the Secretary toreassign values to conservation banks. On the other hand, allowing the Secretaryto determine the value and credits for each bank, has the potential to insure thatthere will be consistency among banks. This may be helpful, since a credit programfor species could involve a wide range of habitat values. A service area is an area identified in a conservation bank agreement. Itincludes a soil type, watershed, habitat type, political boundary, or an area in afederally recognized conservation plan, among others, in which a credit may be usedto offset the effects of a project (p. 32). The scope of a service area may vary broadly under this definition, whichcould allow the Secretary to create areas that fit desired biological criteria. Because person under the ESA includes federal agencies, and page 32 includes a referenceto federally recognized conservation plans, the provisions on conservation bankingmay apply to federal agencies; it is unclear if this was intended. Conservation banks may be established by any private landowner who appliesand demonstrates that the affected area is managed under an enforceable legalinstrument and contributes to the conservation of a listed species, a candidate species,or a species of special concern (pp. 32-33). Secretary shall approve or disapprove abank within 180 days after the application is submitted (p. 33). A bank can bemanaged by a state, a holder of the bank, another party specified in the agreement,or a party that acquires property rights related to the conservation bank (p. 34). While conservation banks would require an enforceable legal instrument, thebill does not specify any contents for that instrument. There may be certain minimalcontents that all such instruments or banking agreements should contain to ensurethat protection of species and habitat will be effective and consistent from site to site. The time limit for a decision will allow approved banks to enter into the program andgain credits within six months, which some feel would encourage participation, butit is unclear whether this period will be sufficient for the Secretary to render adecision with adequate justification. Management of the bank is not restricted,which may relieve the burden of management from the landowner and allow otherentities (e.g., state agencies or non-governmental organizations) to manage the bank. However, no criteria for holders are stated. The holder of a conservation bank is required to establish an agreement thatdescribes the proposed management of the bank (p. 34). The agreement is submittedto the Secretary, who shall approve or disapprove it "as soon as practicable" (p. 35). Conditions for amending and nullifying the agreement are given (pp. 35-36). TheSecretary shall consider the use of banks for implementing recovery plans and mustadopt regulations on managing banks that balance the biological conditions of thetarget species and habitat with "economic free market principles" to ensure value tolandowners through a tradeable credit program (p. 36). A bank management agreement undergoes a separate approval process fromestablishing a conservation bank, and the deadline for approving or disapprovingbank management agreements is uncertain. No standards for acceptable agreementsare provided. An approved agreement does not seem to be required to transfercredits or to maintain a conservation bank. The bill does specify that the bank mustcontribute to the conservation of qualified species, but there is no requirement thatbanks be consistent with approved recovery plans, and it is not clear that bankmanagers must comply with the relevant agreement. The Secretary is to promulgate regulations on managing conservation banks(p. 37). The regulations are to relate to 11 subjects, including conservation andrecovery goals, activities that may be carried out in any conservation bank, measuresthat ensure the viability of conservation banks, "the demonstration of an adequatelegal control of property proposed to be included in the conservation bank" (p. 37),criteria for determining credits and an accounting system for them, and theapplicability of and compliance with §7 and §10 of ESA. Monitoring and reportingrequirements are also to be addressed in the regulations (pp. 37-38). The regulations are to include provisions "relating to" how the consultationrequirements of §7 of the ESA and the incidental take provisions apply in the contextof conservation banks. It is not clear whether the authority given the Secretary todevelop these regulations could be broad enough to eliminate consultation, or toauthorize the issuance of general incidental take permits for activities inconservation bank areas. The requirement that banks be financially viable (pp.37-38) appears to refer to both biological and financial viability. As to the latter,some contend that financial viability should be determined by market forces ratherthan the federal government, which should ensure the biological viability of thespecies or habitat should a bank fail. Biological data would determine how many credits a bank can sell (p. 38),and the Secretary is to establish a standard process by which credits could betransferred. Credit transfers can be used to comply with court injunctions, to meetrequirements of §§7(a), 7(b) or 10(a)(1) of the ESA, and to provide out-of-kindmitigation (p. 39). "Out-of-kind mitigation" is defined as mitigation involving thesame species or habitat, but in a different service area. Additional requirements mustbe met for approval of out-of-kind mitigation, and the Secretary is to give preferenceto in-kind mitigation to the maximum extent practicable (pp. 39-40). The Secretaryis not to regulate the price of credit transfers or to limit participation by any party inthe credit transfer process (p. 40). In some circumstances, credits may be transferredbefore the Secretary approves a bank (p. 41). The criteria for transferring credits do not include habitat or speciesrequirements for the area being mitigated by the purchase of credits. Habitat fordifferent species may not be interchangeable; therefore, if the area being mitigatedcontained habitat for an endangered species of salamander, there are norequirements that credits purchased will be from a conservation bank with similarhabitat. Out-of-kind mitigation is allowed when both ecological desirability andeconomic practicability can be met. The bill allows transfer of credits before thebank is approved if specified conditions can be met, which would seem to be a riskto the federal interest in species protection should the Secretary ultimately reject theapplication for establishing the bank. If the Secretary rejects a bank proposal, howwould that rejection affect any prior purchase of credits? Creation of conservation banks can be integrated with conservation plansdeveloped under §10 of the ESA if certain criteria are met (pp. 41-42). Any party toan agreement, including the United States, may sue for breach of the agreement, andsovereign immunity is waived for participating federal, state, tribal, and localgovernments (pp. 42-43). Subsection (g) (pp. 41-42) requires, to the maximum extent practicable , thata bank be integrated with habitat conservation plans developed under §10 of the ESAif the bank meets the ecological criteria of the habitat conservation plan andprovides greater economic benefits compared with other forms of mitigation ofhabitat destruction. Only a party to the agreement (not interested outsiders withstanding) may sue for breach of the agreement. How this restriction could affectenforcement actions under §10 is not clear. Since a party violating an agreement isnot likely to sue to enforce the agreement, this really means that only the Secretarycan enforce the agreement. "Equitable relief" is specifically allowed, despite thewording that judicial review is allowed for a breach of an agreement -- whichusually connotes a suit for damages. It is not clear in what circumstances states,local governments, or tribes would be defendants. Taxpayers may claim a tax credit based on the taxpayer's qualifiedconservation and recovery costs for the taxable year (pp. 56-62). Qualified costs arethose paid or incurred by the taxpayer in carrying out approved site-specific recoveryactions under §4(f) of ESA or other federal- or state-approved conservation andrecovery agreements that involve an endangered, threatened, or candidate species (p.57). The project must be undertaken according to a binding agreement, and the creditis subject to recapture if the agreement is breached or terminated (pp. 57-58 and 61). The amount of tax credit gained depends on the length of the agreement: 1) if it is forat least 99 years, the credit equals the reduction in the land's fair market value due tothe recovery action or agreement plus the property owner's actual costs; 2) if it is forat least 30 years but less than 99 years, the credit equals 75% of the above amounts;3) if it is for at least 10 years but less than 30 years, the credit equals 75% of theactual costs (pp. 57-58). The qualifications or standards for the binding agreement are unclear. Depending on the specifics of the agreement, the requirements for claiming the taxcredit may be more or less stringent than those for tax incentives that currently existfor similar conservation activities (e.g., the charitable deduction for conservationeasements under IRC §170). The taxpayer must submit to the IRS evidence of the binding agreement anda written verification from a biologist that the conservation and recovery practice isdescribed in the agreement and implemented during the taxable year in accordancewith the agreement's schedule (pp. 58-59). The credit may not be claimed if thetaxpayer received cost-share assistance from the federal or state government underany credit-eligible recovery action or agreement for that year (p. 59). There is anexception for individuals whose adjusted gross income is less than the limitations inIRC §32, the earned income tax credit (p. 59). Also, the taxpayer's qualified costs arereduced by any non-taxable governmental assistance for qualified conservation andrecovery costs received in the year the credit was claimed or in any prior year (p. 61). With respect to the second limitation regarding cost-share assistance, it isunclear as to whether the assistance must have been received for the specific projectfor which the credit is claimed. There are no requirements regarding thequalifications of the biologist who can verify the agreement. The basis of the property for which any credit is allowable must be reducedby the amount of the taxpayer's qualified costs, regardless of whether those costswere greater than the amount that the taxpayer's tax liability exceeded the sum of thespecified credits (p. 60). This could be interpreted to require that the taxpayer reduce the basis by thetotal qualified costs in the first taxable year even if the taxpayer did not claim the fullcredit in that year. Thus, the taxpayer would experience the negative consequencesfrom reducing the basis to account for the total costs without necessarily receivingthe positive benefits from claiming the full credit. The amount of any deduction or other tax credit must be reduced by thetaxpayer's qualified costs, limited to the taxpayer's tax liability (pp. 60-61). This appears to require that the taxpayer reduce all deductions and othercredits by the amount of the credit allowed, regardless of whether they are based onthe same expenses used for this credit. The credit is limited to the taxpayer's tax liability (including alternativeminimum tax liability) after applying certain credits (p. 57). Any portion of the creditthat cannot be claimed because of this limitation may be carried back for one yearand carried forward for 20 years (pp. 59-60). The new credit may be transferredthrough sale and repurchase agreements (p. 60). The tax consequences of such sale are unclear. This provision is unusual asno other tax credit is allowed to be sold.

The Endangered Species Act (ESA) protects species that are determined to be eitherendangered or threatened according to assessments of their risk of extinction. The ESA has not beenreauthorized since September 30, 1992, and efforts to do so have been controversial and complex. Some observers assert that the current ESA is a failure because few species have recovered, and thatit unduly and unevenly restricts the use of private lands. Others assert that since the act's passage,few species have become extinct, many have improved, and that restrictions to preserve species donot place a greater burden on landowners than many other federal, state, and local laws. This report provides a side-by-side analysis of two bills and a proposed amendment thatwould amend the ESA. This analysis compares H.R. 3824 , the Threatened andEndangered Species Recovery Act of 2005, as passed by the House; proposed House Amendment588 to H.R. 3824 (Miller/Boehlert Amendment); and S. 2110 , theCollaboration for the Recovery of Endangered Species Act. Proponents of each proposal indicate that it is designed to make the ESA more effective byredefining the relationship between private and public property uses and species protection,implementing new incentives for species conservation, and removing what some see as undue landuse restrictions. Thus, all three proposals contain provisions meant to encourage greater voluntaryconservation of species by states and private landowners, a concept that has been supported by manyobservers. Further, all three proposals would modify or eliminate certain procedural or otherelements of the current ESA that some have viewed as significant protections and prohibitions,including eliminating or changing the role of "critical habitat" (CH) (which would eliminate oneaspect of the current consultation process); making the listing of all threatened and endangeredspecies more difficult or less likely; expanding §10 permits allowing incidental take (which couldincur a greater need for agency oversight and enforcement); and expanding state rather than federalimplementation of ESA programs (which might make oversight more difficult). Proponents of thesechanges assert that tighter listing standards would enable a better focus on species with the most direneeds, and that other measures would achieve recovery of more species. Critics argue that proposedchanges create gaps in the ESA safety net of protections and prohibitions. It is difficult to assess whether, on balance, the proposals would be likely to achieve greaterprotection and recovery of species, or to what extent the controversies over land use constraintswould diminish. However, replacing some of the protections of the current ESA with newincentives, rather than adding the new incentives to the current protections, arguably makes adequatefunding of the new programs more critical to determining the outcome of the ESA. This report will be updated as events warrant.

Under the provisions of Title XVI of the Social Security Act, disabled individuals and persons who are 65 or older are entitled to benefits from the Supplemental Security Income (SSI) program if they have income and assets that fall below program guidelines. SSI benefits are paid out of the general revenue of the United States and all participants receive the same basic monthly federal benefit. In most states, adults who collect SSI are automatically entitled to coverage under the Medicaid health insurance program. A participant in the SSI program receives the federal benefit rate (FBR), plus any state supplement, minus any countable income. At the end of June 2011, more than 8 million people received SSI benefits. In that month, these SSI beneficiaries each received an average cash benefit of $499.40 and the program paid out a total of nearly $4.3 billion in federally administered SSI benefits. The average monthly benefit is lower than the FBR because a person's final monthly benefit is based, in part, on his or her earnings and other income. Individuals and couples must have limited assets or resources to qualify for SSI benefits. Resources are defined by regulation as "cash or other liquid assets or any real or personal property that an individual (or spouse, if any) owns and could convert to cash to be used for his or her support and maintenance." The countable resource limit for SSI eligibility is $2,000 for individuals and $3,000 for couples. These limits are set by law, are not indexed for inflation, and have been at their current levels since 1989. Not all resources are counted for the purposes of determining SSI eligibility. The Social Security Act and federal regulations provide various types of resource exclusions that allow individuals or couples to own certain assets and not have them counted against their $2,000 or $3,000 resource limit. In addition, the laws governing several federal benefit programs, including the Food Stamp program, prohibit the Social Security Administration (SSA) from counting benefits paid under these programs as resources when determining SSI eligibility. The following section of this report will detail the four types of accounts that a person or couple may have money in and not have that money counted as a resource for the purposes of determining their SSI eligibility. Money set aside by an SSI recipient to pay for his or her burial expenses can be excluded from the SSI resource limits. Each person may set aside up to $1,500 for burial expenses and these expenses must be separately identifiable from other assets and money held. A burial plot owned by an individual or a couple is not considered a resource and its value is not counted against the $2,000 or $3,000 resource limit. There are two cases in which the amount of the burial expense exclusion may be reduced. First, the total amount permitted to be excluded is reduced by the face value of all life insurance policies held by the individual or his or her spouse. The face value of a policy is the amount the insurer agrees to pay the beneficiary upon the death of the insured. Second, the excluded amount of burial expenses is reduced by the total amount of money held in an irrevocable trust (commonly called an irrevocable burial trust) available to meet the burial expenses of the individual or his or her spouse. Under the provisions of the Foster Care Independence Act of 1999, P.L. 106 - 169 , the corpus , or total value, of any trust established by an individual is counted as a resource when determining SSI eligibility unless there is no circumstance under which a payment from the trust could ever be made for the benefit of the individual or the individual's spouse. Nearly all trusts, even irrevocable burial trusts, trusts deemed irrevocable under state law and trusts with specific exculpatory clauses exempting the trust from parts of the Social Security Act, are covered by this provision and the entire value of the corpora of these trusts is counted as a resource. While most irrevocable burial trusts are not excluded from the SSI resource rules, the value of the corpora of these trusts is still used to reduce the amount of the burial expense exclusion. A Plan for Achieving Self-Support (PASS) is an individual plan for employment designed by an SSI beneficiary. An SSI beneficiary designs his or her own PASS, usually with the assistance of a state Vocational Rehabilitation agency, disability service organization or Ticket to Work Employment Network. The plan must be submitted in writing to the SSA and must be approved by a special network of SSA employees called the PASS Cadre. A PASS must include a specific goal for employment, such as a specific job type desired or a plan for setting up a small business. In addition, a PASS must include a time line for achieving the employment goal. The PASS must also include a list of any goods, such as assistive devices or job-specific tools, or services, such as schooling, that will be needed by the beneficiary to achieve his or her goal and must include a time line for the use of these goods or services and their cost. Resources included in an approved PASS are not counted against the SSI resource limits. There is no limit to the amount of resources that can be excluded as part of a PASS and these resources can include money set aside to pay for elements of the PASS such as training or items purchased as part of the PASS such as assistive technology devices. If a beneficiary does not fulfill the terms of the PASS, then these resources can be counted and he or she may lose SSI eligibility and be required to reimburse the SSA for benefits paid after eligibility was lost. Individual Development Accounts (IDAs) are matched savings accounts that allow families and persons with low-incomes to set aside money for education, the purchase of a home, or the creation of a business. An individual may place money from his or her earnings into an IDA and have that amount of money matched by the state with funds from the state's Temporary Assistance for Needy Families (TANF) block grant. In addition, under the provisions of the Assets for Independence Act, P.L. 105 - 285 , nonprofit organizations, and state, local, or tribal governments may compete for grants to fund IDAs for low-income households. IDAs funded through this grant process are often referred to as Demonstration Project IDAs. Money saved in a TANF IDA or a Demonstration Project IDA, including the state contribution and any interest earned, is not counted as a resource for the purposes of determining SSI eligibility. There is no limit to the amount of money in an IDA that can be excluded from the SSI resource calculation. However, there are limits to the amounts states and other entities can contribute to IDAs. When a child SSI beneficiary is owed back SSI benefits of more than six months, his or her representative payee is required to place those benefits in a dedicated account at a financial institution. This dedicated account must be in the child's name and can not be invested in stocks, bonds, or other types of securities. Any money placed in the account and any interest earned on the account is the property of the child. The representative payee may use the money from the dedicated account for the medical care or education and training needs of the child. In addition, money from this account can be used for personal needs assistance, special equipment, housing modifications, or therapy for the child based on his or her disability or for other items and services for the child approved in advance by the SSA. Money from a dedicated account can not be used for the daily expenses, food, clothing, or shelter of the child. The representative payee is responsible for keeping records and receipts of all deposits and expenditures and is liable to the SSA for any misuse of money in a dedicated account. Money in a dedicated account for children is not counted as a resource for the purposes of determining the child's SSI eligibility or the SSI eligibility of the representative payee.

As a means tested program, Supplemental Security Income (SSI) places a limit on the assets or resources of its beneficiaries. However, there are four types of accounts that can be used by SSI beneficiaries for specific purposes without affecting their SSI eligibility. Money placed into burial accounts, money used as part of a Plan for Achieving Self-Support (PASS), money placed in Individual Development Accounts (IDAs), and money placed in dedicated accounts for children are not counted as resources for the purposes of determining SSI eligibility. These accounts can be used by SSI beneficiaries to build assets or plan for the future and represent an important part of the overall SSI program. This report provides an overview of these four types of accounts and outlines the cases when money placed into these accounts is exempt from the SSI resource limitations. This report will be updated to reflect any changes in this legislation or other relevant legislative activity.

The federal government has a long history of involvement in water resource development and management to facilitate water-borne transportation, expand irrigated agriculture, reduce flood losses, and, more recently, restore aquatic ecosystems. Increasing pressures on the quality and quantity of available water supplies—due to growing population, environmental regulation, in-stream species and ecosystem needs, water source contamination, agricultural water demand, climate variability, and changing public interests—have resulted in heightened water use conflicts throughout the country, particularly in the West. Federal water resource construction waned during the last decades of the 20 th century in response to fiscal constraints, interest in more local control of water and land resources, and requirements to assess environmental impacts of federal actions and to protect fish and wildlife. This marked the end of expansionist federal policies of the early 20 th century that had led to widespread federal investment in dams, navigation locks, irrigation diversions, and levees and basin-wide planning and development efforts. The 110 th Congress is faced with numerous water resource issues regarding the federal role in the planning, construction, maintenance, inspection, and financing of water resource projects and federal investment in water resources research and data collection. Congress makes these decisions within the context of multiple and often conflicting laws and objectives, competing legal decisions, and entrenched institutional mechanisms, including century-old water rights and long-standing contractual obligations. Although most water resource legislation typically addresses site-specific needs, certain themes and issues appear in many local and regional water resources conflicts. For example, demand for new project services (e.g., improved navigation, new water supply, improved or new flood control facilities), protection of threatened and endangered species, and water quality concerns are common to many conflicts. Even so, most water resource legislation deals with specific sites. The 110 th Congress is considering site-specific restoration legislation for coastal Louisiana, the Upper Mississippi River-Illinois Waterway System, the Great Lakes, the San Joaquin River, and the Platte River. However, the more typical site-specific measures, on a smaller scale, are the hundreds of individual water resources projects authorized through Water Resources Development Acts (WRDAs) and stand-alone bills addressing new water supply technologies and augmentation of existing water supplies, rural water supply development, and Indian water rights settlements. Oversight of existing laws and projects (e.g., Central Valley Project, flood protection in New Orleans and Sacramento) and project operations is also expected, especially where court decisions, agency actions, or other circumstances (such as drought) may affect project operations (e.g., federal projects on the Colorado, Columbia, Klamath, Missouri, Rio Grande, and San Joaquin rivers and pumps in the California Bay-Delta). In the West, naturally scarce water supplies and increasing urban populations have spawned new debates over water allocation—particularly over water for threatened or endangered species—and have increased federal-state tensions, since the federal government has generally deferred to state primacy in intrastate water allocation. Observed changes in the timing of snowmelt and runoff and the potential for further climate variability due to climate change has increased concerns about the reliability of developed water supplies and the flexibility of existing management mechanisms. Western water legislation during the 110 th Congress centers on project management and program issues, such as San Joaquin River settlement legislation, the Bureau of Reclamation's Title 16 water reclamation and recycling program, and sustainability of the West's water supplies. Oversight of the Bureau's Central Valley Project (CVPIA, Trinity River, and CALFED and other San Francisco Bay-San Joaquin/Sacramento Rivers Delta [Bay-Delta] management issues), Klamath project, and Colorado River operations also may continue. Nationally, congressional attention during the 110 th Congress may focus on the federal role in levee construction, maintenance, and evaluation, and water resources management generally. Hurricane Katrina oversight issues—such as how to better coordinate federal activities and how to respond or rebuild in the wake of catastrophic damages—may be of particular focus, as might the examination of other areas of the country that may also be vulnerable. Also of concern nationwide is the status of threatened and endangered species and the health of the nation's rivers and riparian areas. Federal obligations to protect threatened and endangered species and other environmental quality requirements have resulted in increased attention to river and watershed restoration efforts. The federal government is involved in several significant restoration initiatives ranging from the Florida Everglades to the California Bay-Delta (CALFED). At the same time, the demand for traditional or new water supply projects, navigational improvements, flood control projects, and beach and shoreline protection continues. In fact, both the Everglades and Bay-Delta restoration efforts include significant water supply components. Controversy over how much water should be divided among recovering (threatened and endangered) species, protecting water quality, and supplying farms, cities, and other uses has been ongoing. Further, widespread drought throughout different parts of the country over the past several years has spurred new requests for developing and ensuring dwindling water supplies, and new security threats to water infrastructure have placed added pressures on budgetary resources. The 109 th Congress left pending several national water policy proposals, ranging from new water study commissions and assessments to global sanitation and drinking water aid, some of which have been reintroduced in the 110 th Congress. The 110 th Congress also has addressed water resource issues during consideration of individual project authorizations, as well as during debate on WRDA legislation ( H.R. 1495 ) and on FY2008 appropriations for the Bureau and the Corps. Specific issues that are being or may be discussed during the 110 th Congress are treated below. Other general issues also being discussed include federal reserved water rights in relation to federal lands, transfer of water across federal lands and through federal facilities, Indian water rights settlements, licensing of nonfederal hydropower facilities (i.e., private dams regulated by the Federal Energy Regulatory Commission (FERC)), and whether to establish a national water commission to address federal water policy and coordination. Most of the large dams and water diversion structures in the United States were built by, or with the assistance of, the Bureau of Reclamation in the Department of the Interior (Bureau) or the U.S. Army Corps of Engineers in the Department of Defense (Corps). Traditionally, Bureau projects were designed principally to provide reliable supplies of water for irrigation and some municipal and industrial uses; Corps projects were designed principally for flood control, navigation, and power generation. The Bureau currently manages hundreds of storage reservoirs and diversion dams in 17 western states, providing water to approximately 9 million acres of farmland and 31 million people. The Corps' operations are much more widespread and diverse, and include several thousand flood control and navigation projects throughout the country, including 25,000 miles of waterways (with 238 navigation locks), nearly 1,000 harbors, and 400 dam and reservoir projects (with 75 hydroelectric plants). Since the early 1900s, the Bureau has constructed and operated many large, multi-purpose water projects. Water supplies from these projects have been primarily for irrigation. Construction authorizations slowed during the 1970s and 1980s due to several factors. In 1987, the Bureau announced a new mission: environmentally sensitive water resources management. In the following decade, increased population, prolonged drought, fiscal constraints, and increased water demands for fish and wildlife, recreation, and scenic enjoyment resulted in increased pressure to alter operation of many Bureau projects. Such changes have been controversial, however, as water rights, contractual obligations, and the potential economic effects of altering project operations complicate any change in water allocation or project operations. In contrast to the Corps, there is no regularly scheduled authorization vehicle for Bureau projects. Instead, Bureau projects are generally considered individually. Bureau-related water project and management issues that are being or may be considered during the 110 th Congress include: San Joaquin River restoration settlement legislation; examination of the Bureau's Title 16 (recycling and reuse) program; oversight of CVPIA and CVP operations; oversight of, and appropriations for, CALFED (and other Bay-Delta issues, such as Delta Smelt population declines); San Joaquin/San Luis Unit drainage issues and potential title transfer; authorization of individual water recycling and desalination projects; response to drought, and effects of climate variability on federal reservoirs; and Colorado River water management issues. A broader issue that often receives attention from Congress is oversight of the Bureau's mission and its future role in western water supply and water resource management generally. As public demands and concerns have changed, so has legislation affecting the Bureau. Further, many in Congress have questioned the Bureau's shift in focus from a water resources development agency to a water resource management agency. Some have also questioned the increasing number of proposals to fund new rural water supply projects with high federal cost-share ratios and grants for reclaiming and reusing water. Critical questions Congress may address include: What should be the future federal role in water resources development and management? What do western water managers need from the Bureau and how can the Bureau help with western water management? Should (or to what extent should) the federal government develop or augment new supply systems designed primarily to serve communities/municipalities, or is this a local/regional responsibility? Who should pay, and how much? Should the Bureau be involved in environmental mitigation or is this best handled through new institutional arrangements (e.g., CALFED) or other existing agencies (e.g., Fish and Wildlife Service and/or the Environmental Protection Agency)? Should existing projects be revamped or "re-operated" to accommodate changing demands, and, if so, do new policies and institutions (state-federal roles) need to be addressed, and again, who should pay? Relatedly, the issue of whether there should be a National Water Commission or periodic water resource assessments received some attention in the 109 th Congress, and at least one bill has been reintroduced in the 110 th Congress. Congress authorizes Corps water resources activities and makes changes to the agency's policies generally in Water Resources Development Acts, and at times in the annual Energy and Water Development Appropriations acts. Contents of a WRDA are cumulative and new acts do not supersede or replace previous acts. From the late 1980s until 2002, WRDAs followed a loosely biennial cycle; the last WRDA was enacted in 2000. WRDA bills were introduced or considered in 2002, 2003, 2004, 2005, and 2006, but were not enacted. Their enactment was complicated by differences over whether to authorize controversial projects, and whether to reform or change the way the Corps plans and evaluates projects. Consideration of WRDA 2007 bills by the 110 th Congress has included debates on changes to state and local roles in projects, potential changes in Corps policies and practices (such as changes to Corps permitting and regulatory practices), and authorization of high-profile projects. Prior to Hurricane Katrina, the project authorizations receiving the most attention were coastal Louisiana wetlands restoration, lock expansion and ecosystem restoration for the Upper Mississippi River-Illinois Waterway, and Everglades-related projects. The 2005 hurricane season added other authorizations to the debate, including authorizations for near-term and long-term hurricane protection measures for Louisiana and other Gulf Coast states and flood control activities in other areas of the nation vulnerable to flooding. Hurricane Katrina increased interest in flood control and Louisiana projects in the bill, while also increasing interest in streamlining federal spending, which has some observers concerned about authorizing more Corps projects. For more information on current WRDA issues, see CRS Report RL33504, Water Resources Development Act (WRDA) of 2007: Corps of Engineers Project Authorization Issues , by [author name scrubbed] et al. The 110 th Congress continues to address issues related to the Administration's adoption of a performance-based budgeting approach for the agency, as well as safety and security of Corps facilities and implementation of Florida Everglades ecosystem restoration. Recent Congresses have expressed dissatisfaction with the Corps' financial management, particularly the reprogramming of funds across projects and the use of multiyear continuing contracts for projects. Corps flood control and hurricane protection projects, in particular, are receiving congressional and public scrutiny following Hurricane Katrina. This scrutiny is added to the attention already on the Corps' river and reservoir management; in many cases, Corps facilities and their operation are central to debates over multi-purpose river management. For example, water resources management by the Corps, particularly on the Mississippi, Missouri, and Columbia and Snake Rivers system, remains controversial and is frequently challenged in the courts. The Corps' projects and role in emergency response also may be the subject of congressional oversight, legislative direction, authorizing legislation, and appropriations. Water resources debates in the 110 th Congress likely will be dominated by different opinions of the desirability and need for changing the water resource agencies' policies, practices, and accountability, and for authorizing multi-billion dollar investments in ecosystem restoration, navigation, and flood and storm damage reduction measures. A broad water resource issue significant to the water resources agencies and the nation is the changing federal role in water resources planning, development, and management. Hurricane Katrina raised questions about this role; in particular, the disaster brought attention to the trade-offs in benefits, costs, and risks of the current division of responsibilities among local, state, and federal entities for flood mitigation, preparedness, response, and recovery. The question of the federal role also is raised by the increasing competition over water supplies, not only in the West but also for urban centers in the East (e.g., Atlanta), which has resulted in a growing number of communities seeking financial and other federal assistance, actions, and permits related to water supply development (e.g., desalination and water reuse projects, reservoir expansions and reoperations). Congress rarely chooses to pursue broad legislation on federal water resources policies for many reasons, including the challenge of enacting changes that affect such a wide breadth of constituencies. Another practical challenge is the fractured nature of congressional committee jurisdictions over water resources and water quality issues and activities. Consequently, Congress traditionally has pursued incremental changes through WRDA bills for the Corps and project-specific legislation for the Bureau, and this pattern seems likely to continue.

Water resources management often involves trade-offs among user groups, environmental interests, and local, regional, and national interests. Water resources development is particularly controversial because of budgetary constraints, conflicting policy objectives, environmental impacts, and demands for local control. Hurricane Katrina brought to the forefront long-simmering policy disputes involving local control, federal financing, environmental and social tradeoffs, and multi-level accountability and responsibility for water infrastructure projects, such as levees. Construction, improvement, and management of other federal water resource projects (e.g., locks, dams, and diversion facilities) face similar challenges. The 110th Congress faces numerous issues and trade-offs as it considers water resource development, technology, water supply, and climate change legislation. These issues are likely to arise as Congress considers authorizations and appropriations for Bureau of Reclamation and Army Corps of Engineers projects (e.g., Water Resources Development Act of 2007, H.R. 1495), and agency policy and program changes (e.g., water reuse, federal project operations, and oversight of ecosystem restoration programs such as CALFED and Everglades). Oversight issues related to Hurricane Katrina and the federal role in hurricane and flood protection, and levee construction and management, also are ongoing.

Israel's energy sector is set to undergo significant changes that could transform the country into an exporter of natural gas. Development of three recently discovered natural gas fields—Tamar, Dalit, and Leviathan (see Figure 1 )—is projected to begin at the end of 2012 and be completed by the end of the decade. The estimated supplies from these fields (see Table 1 ) would enable Israel to decrease its natural gas and coal imports and possibly its oil imports. Coal imports would likely be most affected as coal is currently the primary fuel for electric generation, and can be displaced by natural gas. Israel's trade balance would likely improve and its carbon dioxide emissions would likely decline as a result. The discovery of natural gas resources has also led Israel to reevaluate the nation's energy tax policy. Israel's Ministry of Finance has recommended tax policy changes that would increase tax revenues, but decrease potential after-tax profits for developers. Regionally, Israel's success thus far has sparked interest from its neighbors to explore their boundaries for energy resources and has raised concerns from Lebanon about sovereignty over the discoveries. Israel is poised to became an energy producer and perhaps even a natural gas exporter provided its recent discoveries come to fruition. At the end of last year, Noble Energy, a U.S. independent energy company, reconfirmed its estimates for its third and largest natural gas discovery off the northern coast of Israel. The Leviathan field has an estimated resource base of 16 trillion cubic feet (tcf) of natural gas, but will require at least two more appraisal wells to be drilled before the size of the resource base is better defined. Noble Energy's other natural gas discoveries (Tamar and Dalit) coupled with the success of other companies puts Israel in a position to be self sufficient in natural gas and possibly become a natural gas exporter, thus improving the country's energy and economic security. Since January 2009, Noble Energy has made three natural gas discoveries—Tamar, Dalit, and Leviathan—with an estimated 25 tcf of resources. Israel's natural gas reserves—natural gas that has been discovered and can be expected to be economically produced—prior to the Noble Energy discoveries were estimated at 1.5 tcf or about 16 years worth at current production levels. If only half the natural gas from the new discoveries is produced at today's production levels, Israel would have well over a 100-year supply of natural gas. It is too early to know the rate of natural gas recovery from the three new fields or if other discoveries will arise, but it is highly likely that Israel's energy mix will move towards natural gas by the end of the decade. Tamar's first production is expected at the end of 2012, with Dalit one or two years after that, and Leviathan between 2016 and 2018. According to Noble Energy, Tamar alone is expected to reach a maximum capacity of one billion cubic feet per day (bcf/d) by 2013 or 2014, or over three times the rate of Israeli consumption in 2009 of 0.31 bcf/d. Until 2008, Israel's demand for natural gas was met by domestic production. An import pipeline from Egypt began deliveries in 2008 and despite public discontent against the sales in Egypt, the pipeline remains operational today ( Figure 2 illustrates Israel's natural gas consumption and highlights the effect of Egyptian imports). Natural gas from the new fields could displace the Egyptian imports, which has benefits and disadvantages for both countries. Israel pays below market prices for the natural gas it imports from Egypt. Continuing the imports and using additional production to begin exports, most likely to Europe or Jordan, could further improve Israel's energy and economic security. Eliminating the imports could improve Israel's trade balance and provide greater supply security. For Egypt, stopping the exports to Israel would have political advantages as the natural gas sales to Israel were unpopular with Egyptians and were taken into court. The impact of the current unrest in Egypt on its natural gas exports to Israel is unclear. Maintaining the exports to Israel could help Egypt's trade balance. At the end of April, the natural gas terminal near El-Arish in Egypt (see Figure 1 above) was attacked for the second time since protests erupted in that country in January. Natural gas from the terminal supplies the Arab Gas Pipeline to Jordan, Syria, and Lebanon, and a separate pipeline to Israel. There is no estimate for how long natural gas will not be exported. The pipeline was also attacked and disabled in February causing natural gas supplies to be stopped for about a month. The terminal has been a target for Bedouins who feel neglected and oppressed by Cairo. Israel's consumption of natural gas has been growing since 2003, but remains a relatively small portion of its current energy mix at 11%. Oil accounts for almost half of Israel's primary energy consumption, while coal is 35%. (See Figure 3 .) However, the recent natural gas discoveries have the potential to substantially change the share of natural gas use in Israel. Industry forecasts project that by 2015, Israel could be consuming 1 bcf of natural gas per day, an almost threefold increase from today's consumption. The three new natural gas fields represent potentially 26 times the total amount of energy currently consumed annually by Israel from all fuel sources. Israel's electricity generation sector will most likely utilize the new resources more than other sectors (see section below) and could even facilitate Israel moving towards electrification of its car fleet, a goal the government has set. Current energy infrastructure is equipped primarily for oil and coal; substituting natural gas would require major changes and investment to the electricity and transportation sectors. Israel's electricity generation sector will most likely undergo the greatest change because of the development of Israel's natural gas resources. Currently, natural gas fuels about 26% of Israel's electric generation. (See Figure 4 .) Coal supplies almost two-thirds of the generation capacity. If Israel were to convert all of its existing electric power generation to natural gas, it would require approximately an additional 0.8 bcf/d of natural gas, the estimated maximum output from the Tamar natural gas field alone. Replacing only its coal units would require approximately 0.67 bcf/d of natural gas. If these conversions were to occur, carbon dioxide emissions from the electricity generation sector would decrease 52% and 50%, respectively. However, this would be a major investment and likely require many years to achieve. Switching to a natural gas-based electrical sector would allow Israel to increase the domestic share of energy production. Currently, Israel imports all of its coal and most of its oil. In April 2010, Israel's Minister of Finance appointed a committee to examine fiscal policy related to oil and gas resources in Israel, prompted by the recent natural gas discoveries. The committee was directed by Israel's Minister of Finance to (1) evaluate Israel's fiscal system as it relates to oil and gas reserves and compare Israel's system to countries in similar economic circumstances; (2) propose an updated fiscal system; and (3) examine the potential effects current and future natural gas discoveries would have on the Israeli economy. The committee's draft conclusions were released by Finance Ministry on November 10, 2010. The committee found that "the current system does not properly reflect the public's ownership of its natural resources." The committee's draft conclusions recommended two major changes to Israel's tax treatment of the oil and gas industry. First, the draft conclusions suggested eliminating the existing depletion deduction. Second, a progressive tax on oil and gas profits was proposed. In the proposal, profits were determined using the ratio of total revenues to total exploration and development costs. The committee's draft conclusions did not recommend a change in Israel's royalty rate, which is set at 12.5%. The committee's final report was released on January 3, 2011, and fully accepted by Prime Minister Netanyahu and the cabinet. Overall, the committee's recommendations would increase the government's share on oil and gas revenues to between 52% and 62%, up from the current 30%. Like the draft conclusions, the committee's final recommendations suggest eliminating the depletion allowances and imposing a tax on oil and gas profits. The tax on profits would start after the project had earned cumulative net income equal to 150% of its exploration and development costs. The rate of tax would start at 20%, increasing to maximum rate of 50%. This tax increase would be phased in over time. Fields that start production prior to 2014—which would likely include Tamar and possibly Dalit, but not Leviathan—would be partially exempt from the tax increase. For reserves in which extraction begins by January 1, 2014, the profits tax will not apply until cumulative net income reaches 200% of exploration and development costs and will not be fully phased in until reaching 280%. The tax increase recommended in the final report was less than was initially presented in the draft proposal. The proposed tax increases will be enacted only if approved by the Israeli government. Israeli and U.S. companies oppose any tax increase, and argue that changing the tax regime will deter future energy resource development. Oil and gas producers in the United States pay the U.S. corporate income tax. The corporate tax is levied on taxable income, which is calculated as gross income less deductions. The statutory corporate income tax rate is generally 35%. There are a number of deductions specific to the oil and gas industry, such as the ability to expense intangible drilling costs (IDCs) and to claim percentage depletion instead of cost depletion. Oil and gas producers are also eligible for the Section 199 production activity deduction. The United States has generally not imposed a specific profits tax above and beyond the corporate income tax on the oil and gas industry. However, from 1980 through 1988, the United States levied a windfall profits tax (WPT) on the U.S. oil industry. In practice, the WPT was an excise tax. The tax was determined according to the price of oil rather than on profits. The WPT was enacted to address increased oil industry profits following the decontrolling of oil prices. The announcements by Israel and Noble Energy of significant natural gas discoveries have prompted Lebanese leaders to raise concerns that the natural gas fields are at least partially in Lebanese waters and that Israel will "steal" Lebanon's resources if the Lebanese government does not act. Lebanon and Israel have never defined their maritime border as the two countries are still technically at war. The Lebanese government has appealed to the United Nations, particularly the UN Interim Force in Lebanon, to intervene in defining the maritime border, but the UN has declined thus far to delineate the maritime border. Some trade press for the natural gas industry is depicting all the Noble Energy discoveries within Israeli borders. There has been rhetoric from both the Lebanese and Israeli governments about using all means necessary, including military action, to defend their national resources, according to regional press reports. Whether Israel will become an exporter of natural gas is yet to be determined. If the resource estimates are correct, the new fields would give Israel the resources to become an exporter. A number of factors raise doubts about the viability of exports: Growing domestic demand—and potential new uses for gas, energy security issues, the expense of liquefying the natural gas for transport, an existing global glut of natural gas, and the politics of pipeline exports. Noble Energy is exploring the possibility of building a liquefaction facility, possibly in Cyprus to utilize any natural gas discovered there, for exports to Europe and Asia, but it is too early to determine the feasibility of such a project. Hoping to replicate Israel's success in finding new energy resources, Cyprus, Lebanon, and Syria have announced timetables for holding auctions for licenses to explore for oil and gas. Cyprus and Syria plan to hold their license auctions this year, while Lebanon has theirs scheduled for 2012. It is unclear how the ongoing political deadlock might affect the Lebanese government's plans to move forward with its energy development. In December 2010, Cyprus and Israel signed an agreement defining their sea border. In March 2010, The U.S. Geological Survey (USGS) released a report on the Levant Basin province that stretches from the Sinai peninsula to the northern border of Syria and from the coast into the Mediterranean Sea to the western side of Cyprus. The report stated that the Levant Basin may hold 1.7 billion barrels of recoverable oil and 122 trillion cubic feet of recoverable natural gas. In light of the USGS report, Noble Energy and its partners have raised the prospect of drilling deeper, below the natural gas bearing formations in the Leviathan field in search of oil. Noble Energy estimates that there is a 17% probability that it could find 3 billion barrels of oil. The probability and estimate will likely change as additional information and data is gathered. The U.S. government is not directly involved in Israel's oil and gas policies. However, in the near-term, consultations regarding the energy policy and regulations would be one area that government to government interaction might take place. Israel has never been a major energy producer and must balance its normal economic and security concerns with development of this new resource. The United States has experience related to regulatory oversight, tax policy, and environmental concerns that could benefit Israel. The regional interest from other countries to develop energy resources creates an opportunity for discussions between Israel and its neighbors, bilaterally or multilaterally and directly or indirectly. Additionally, resolving the maritime demarcation issue between Israel and Lebanon would alleviate industry uncertainty.

Israel has been dependent on energy imports since it became a nation in 1948, but the recent offshore natural gas discoveries could change that and possibly make Israel an exporter of natural gas. Development of the recently discovered natural gas fields—Tamar, Dalit, and Leviathan—likely will decrease Israel's needs for imported natural gas, imported coal, and possibly imported oil. A switch to natural gas would most likely affect electric generation, but could also improve Israel's trade balance and lessen carbon dioxide emissions. Regionally, Israel's success thus far has sparked interest from its neighbors to explore their boundaries for energy resources and has raised concerns from Lebanon about sovereignty over the discoveries. Development of these new resources, and possibly other discoveries, would enhance Israel's economic and energy security. Israel is in the early stages of formulating the regulatory framework to oversee the development of these resources and may seek assistance from the United States or other natural gas producing countries in weighing its options. Key Points: The new discoveries—depending upon the actual production—could represent over 200 years' worth of Israel's current natural gas consumption. Israel's electrical generation sector will likely be the beneficiary of the new natural gas resources. Additional natural gas and possibly oil resources may exist.

Most federal offshore oil and gas production leases contain royalty provisions that require the lessee to pay a certain percentage of revenue on the value of oil and natural gas production to the federal government as the lessor. In 1995, Congress passed the Deep Water Royalty Relief Act (DWRRA), which provides an incentive for exploration of oil and natural gas reserves in "deep water," which might otherwise be uneconomic, by providing that a certain initial volume of production from deep water wells would be exempt from royalty obligations. Section 302 of the DWRRA provides a mechanism by which holders of existing leases can apply for royalty relief, which is to be granted by the Secretary of the Interior if the lease would otherwise be uneconomic. However, Section 302 also provides that these lessees will not be eligible for royalty relief if the price of oil or natural gas exceeds a certain threshold level. While Section 302 of the DWRRA addresses royalty relief for holders of leases in existence at the time of the enactment of the act, Sections 303 and 304 address post-enactment lease sales. Section 303 amends the bidding system to allow Interior to offer leases going forward with royalty relief at the discretion of the Department, while Section 304 carves out an exception to that royalty payment requirement for deep water leases that were entered into within five years of the date of enactment of the DWRRA. Pursuant to Section 304, the standard royalty requirement is to be suspended for lessees holding these leases until a certain volume of oil or natural gas is produced by the lessee. The volumetric limitation on royalty relief varies based on the water depth of the leased tract. Once the volumetric threshold is exceeded, a lessee may be required to make royalty payments. Section 304 sets a statutory minimum for the volumetric threshold for royalty relief—the Secretary of the Interior is authorized to grant a higher volumetric threshold at his or her discretion. In 1998 and 1999, MMS issued deepwater offshore leases that were eligible for royalty suspension but did not include a price-based limitation on that eligibility. As a result, holders of these 1998 and 1999 deepwater leases have no obligations to make royalty payments up to the suspension volumes, regardless of the market price of oil or natural gas; the leases do not contain a price threshold on royalty relief. On August 4, 2007, the House passed H.R. 3221 . Included in this omnibus energy bill is the proposed Royalty Relief for American Consumers Act of 2007. One section of this proposed act bars the Secretary of the Interior from issuing any new leases to holders of "covered leases" unless said leaseholders either renegotiate their "covered leases" to include price thresholds or pay a "conservation of resources" fee as established in the proposed act. The statute defines a "covered lease" as "a lease for oil or gas production in the Gulf of Mexico that is ... issued by the Department of the Interior under Section 304 of the Outer Continental Shelf Deep Water Royalty Relief Act ... and ... not subject to limitations on royalty relief based on market prices that are equal to or less than the price thresholds" described in the DWRRA. Any holder of a "covered lease" is forced to decide between three options: (1) the lessee can keep the lease under its current terms (i.e., without a price threshold) and lose the right to bid on future offshore lease sales in the Gulf of Mexico; (2) the lessee can pay a newly created "conservation of resources" fee, as established elsewhere in the proposed act; or (3) the lessee can renegotiate the covered lease to include royalty relief price thresholds. Many observers interpret the proposed act as a legislative attempt to correct the perceived oversight in the 1998-1999 leases that lack price thresholds. Around the same time that the perceived oversight in the 1998 and 1999 leases described above was brought to the public's attention, Kerr-McGee Oil & Gas Corp. (Kerr-McGee) initiated litigation that challenged the authority of the Department of the Interior (DOI) to impose price thresholds on leases sold between 1996 and 2000 (i.e., the effective period of section 304 of the DWRRA). According to Kerr-McGee, section 304 of the DWRRA, which addresses lease sales during the five-year period between 1996 and 2000, barred the inclusion of royalty relief price thresholds to these leases, and therefore the collection of royalties resulting from the imposition of price thresholds contradicted section 304 of the DWRRA. Kerr-McGee brought its claim in the U.S. District Court for the Western District of Louisiana after the DOI issued an Order directing Kerr-McGee to pay royalties on oil and natural gas produced in 2003 and 2004 under eight leases operated by Kerr-McGee under the DWRRA. On October 30, 2007, the court issued a ruling that essentially confirmed Kerr-McGee's position and found that an Order issued by the DOI directing Kerr-McGee to pay royalties based on a price threshold was in error. The court based its ruling on a decision issued by the U.S. Court of Appeals for the Fifth Circuit in 2004 that interpreted the relevant sections of the DWRRA. According to the court: The Fifth Circuit interpreted Sections 303 and 304 of the DWRRA as they pertain to new production requirements for Mandatory Royalty Relief leases. Section 303 added a new bidding system that gave the Interior the authority to lease any water depth in any location with royalty relief fashioned according to the Interior's discretion. The [Fifth Circuit] found that this power, however, was tempered by the next section, where Congress replaced the Interior's discretion to fashion royalty relief with a fixed royalty suspension scheme based on volume and water depth. Thus, the royalty relief for Mandatory Royalty Relief leases is automatic and unconditional. Based on the Fifth Circuit's previous ruling, the district court found that Section 304 mandates royalty relief up to a certain minimum volume of production, regardless of the market price of oil or natural gas. Therefore, the court concluded that the DOI had "exceeded its Congressional authority" when it sought to collect royalties on Kerr-McGee's oil and gas production that did not exceed these volumetric minimums, regardless of whether the oil and gas produced could be sold at prices in excess of the price thresholds for royalty relief that had been included in the lease terms. Since the Kerr-McGee ruling was issued on October 30, 2007, there has been extensive congressional interest in the impact of the ruling on the proposed Royalty Relief for American Consumers Act of 2007, as described above. Specifically, there is confusion as to how the ruling might affect the restrictions that section 7504 seeks to impose on holders of "covered leases." As discussed above, section 7504 requires that persons who hold "covered leases" either: (1) renegotiate their leases to include price thresholds; (2) pay a "conservation of resources" fee as set forth in the section; or (3) forfeit eligibility for future oil or gas production leases in the Gulf of Mexico. Section 7504 and the legislative efforts that preceded it have generally been described as efforts to remedy a perceived "error" or "oversight" in the 1998 and 1999 deep water leases by forcing renegotiation of those leases to include royalty relief price thresholds, or by using the "conservation of resources" fee structure to recover from these leaseholders amounts that had previously been calculated to be roughly the same amount as would be owed if price thresholds had been in place. The recent ruling by the U.S. District Court for the Western District of Louisiana, if upheld, would effectively eliminate the distinction between the 1998 and 1999 deep water leases, which do not include price thresholds, and the 1996, 1997 and 2000 deep water leases, which contain price thresholds that are not enforceable because they are in violation of congressional intent in enacting section 304 of the DWRRA. If none of the leases issued pursuant to section 304 of the DWRRA contains royalty relief provisions that are subject to price thresholds, then it appears that all of these leases ( i.e. , all deep water leases issued between 1996 and 2000) would be "covered leases" as that term is defined in the proposed act. As noted above, section 7504(d)(1) defines a "covered lease" as "a lease for oil or gas production in the Gulf of Mexico that is ... issued by the Department of the Interior under Section 304 of the Outer Continental Shelf Deep Water Royalty Relief Act ... and ... not subject to limitations on royalty relief based on market prices that are equal to or less than the price thresholds" described in the DWRRA. It is important to note that the definition of "covered leases" is not restricted to leases without price thresholds in their terms, or any other definition that would be contingent upon the language in the leases. If this were the case, then only the 1998 and 1999 leases would be "covered leases," because the 1996, 1997 and 2000 leases contain price threshold language. However, the definition of "covered leases" in section 7504(d)(1) encompasses any lease that is not "subject to limitations on royalty relief" based on oil or natural gas market prices. Thus, if the Western District of Louisiana decision is affirmed on appeal, then it appears that none of the leases issued between 1996 and 2000 would be "subject to limitations on royalty relief based on market price," and thus all of these leases may be "covered leases" under the proposed act. As a result, any entity that holds a deep water lease issued between 1996 and 2000 may be ineligible for future oil or natural gas production leases in the Gulf of Mexico pursuant to section 7504(a) of the proposed act until that entity either renegotiates the lease in question or pays a "conservation of resources" fee. If Congress does wish to encourage recovery of royalties on all leases issued pursuant to section 304 of the DWRRA between 1996 and 2000 that are limited by both price and volumetric thresholds, it could likely do so by passage of the proposed Royalty Relief for American Consumers Act of 2007 as it is currently worded in sections 7501-7505 of H.R. 3221 . This option could affect most companies operating in the deep water OCS area. If Congress wishes to restrict the scope of the proposed act to the 1998 and 1999 leases that did not contain price thresholds, it might consider amending the definition of a "covered lease" accordingly.

On October 30, 2007, the U.S. District Court for the Western District of Louisiana issued a ruling in Kerr-McGee Oil & Gas Corp. v. Allred that rebuffed efforts of the U.S. Department of the Interior (DOI) to collect royalties from offshore oil and gas production leases based on so-called "price thresholds" for previously granted royalty relief. There has been considerable interest in the impact of this ruling on ongoing congressional efforts related to certain "missing" royalty payment requirements in leases issued by the Minerals Management Service (MMS) of the DOI in 1998 and 1999, including the proposed Royalty Relief for American Consumers Act of 2007, as found at sections 7501-7505 of H.R. 3221. The House of Representatives passed H.R. 3221 on August 4, 2007. This report (1) provides background on the Outer Continental Shelf Deep Water Royalty Relief Act (DWRRA), pursuant to which royalty-free leases, including the controversial 1998 and 1999 leases, were issued; (2) summarizes relevant portions of the proposed Royalty Relief for American Consumers Act, which attempts to encourage the renegotiation of the controversial 1998 and 1999 leases; (3) summarizes the recent ruling in the Kerr-McGee matter; and (4) analyzes the potential impact of that recent ruling on the proposed Royalty Relief for American Consumers Act and any similar legislative efforts. This analysis is restricted to a discussion of the potential impact of the recent ruling on section 7504 of H.R. 3221, which would place restrictions on holders of leases that lack price thresholds. It does not address section 7503 of H.R. 3221, which seeks to "clarify the authority" of the Secretary of the Interior to include price thresholds on royalty relief in offshore leases pursuant to section 304 of the DWRRA.

International medical graduates (IMGs) are foreign nationals or U.S. citizens who graduate from a medical school outside of the United States. In 2007, the most recent year for which data are available, there were 902,053 practicing physicians in the United States, and IMGs accounted for 25.3% (228,665) of these. The use of foreign nationals remains a means of providing physicians to practice in underserved areas. This report focuses on those IMGs who are foreign nationals, hereafter referred to as foreign medical graduates (FMGs). Many FMGs first entered the United States to receive graduate medical education and training as cultural exchange visitors through the J-1 cultural exchange program. While there are other ways for FMGs to enter the United States, including other temporary visa programs as well as permanent immigration avenues, this report focuses on FMGs entering through the J-1 program. As exchange visitors, FMGs can remain in the United States on a J-1 visa until the completion of their training, typically for a maximum of seven years. After that time, they are required to return to their home country for at least two years before they can apply to change to another nonimmigrant status or legal permanent resident (LPR) status. Under current law, a J-1 physician can receive a waiver of the two-year home residency requirement in several ways: the waiver is requested by an interested government agency (IGA) or state department of health; the FMG's return would cause extreme hardship to a U.S. citizen or LPR spouse or child; or the FMG fears persecution in the home country based on race, religion, or political opinion. Most J-1 waiver requests are submitted by an IGA and forwarded to the Department of State (DOS) for a recommendation. If DOS recommends the waiver, it is forwarded to U.S. Citizenship and Immigration Services (USCIS) in the Department of Homeland Security (DHS) for final approval. Upon final approval by USCIS, the physician's status is converted to that of an H-1B professional specialty worker. Prior to 2004, J-1 waiver recipients were counted against the annual H-1B cap of 65,000. An IGA may request a waiver of the two-year foreign residency requirement for an FMG by showing that his or her departure would be detrimental to a program or activity of official interest to the agency. In return for sponsorship, the FMG must submit a statement of "no objection" from the government of his or her home country, have an offer of full-time employment, and agree to work in a health professional shortage area or medically underserved area for at least three years. According to USCIS regulations, the FMG must be in status while completing the required term and must agree to begin work within 90 days of receipt of the waiver. If an FMG fails to fulfill the three-year commitment, he or she becomes subject to the two-year home residency requirement and may not apply for a change to another nonimmigrant, or LPR status until meeting that requirement. Although any federal government agency can act as an IGA, the main federal agencies that have been involved in sponsoring FMGs are the Department of Veterans Affairs (VA), the Department of Health and Human Services (HHS), the Appalachian Regional Commission (ARC), and the United States Department of Agriculture (USDA). Under the "Conrad Program" discussed below, state health departments may also act as IGAs. HHS has begun accepting waivers to primary care physicians only relatively recently. Historically, HHS had been very restrictive in its sponsorship of J-1 waiver requests. HHS emphasized that the exchange visitor program was a way to pass advanced medical knowledge to foreign countries, and that it should not be used to address medical underservice in the United States. HHS' position was that medical underservice should be addressed by programs such as the National Health Service Corps. Prior to December 2002, HHS only sponsored waivers for physicians or scientists involved in biomedical research of national or international significance. In December 2002, HHS announced that it would begin sponsoring J-1 waiver requests for primary care physicians and psychiatrists in order to increase access to healthcare services for those in underserved areas. HHS began accepting waiver applications on June 12, 2003, but suspended its program shortly after for reevaluation. On December 10, 2003, HHS released new program guidelines, and reinstated their program. Established by Congress in 1965, ARC is a joint federal and state entity charged with, among other things, ensuring that all residents of Appalachia have access to quality, affordable health care. The region covered by ARC consists of all of West Virginia and parts of Alabama, Georgia, Kentucky, Maryland, Mississippi, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, and Virginia. ARC will submit a request for a waiver at the request of a state in its jurisdiction. The waiver must be recommended by the governor of the sponsoring state. In return, the FMG must agree to provide primary care for at least 40 hours a week for three years at a health professional shortage area facility. The facility must be a Medicare or Medicaid-certified hospital or clinic that also accepts medically indigent patients. The facility must also prove that it has made a good faith effort to recruit a U.S. physician in the six months preceding the waiver application. In addition, the physician must be licensed by the state in which he or she will be practicing, and must have completed a residency in family medicine, general pediatrics, obstetrics, general internal medicine, general surgery, or psychiatry. The physician must sign an agreement stating that he or she will comply with the terms and conditions of the waiver, and will pay the employer $250,000 if he or she does not practice in the designated facility for three years. On May 17, 2004, the DRA officially began accepting applications for its new J-1 visa waiver program. The DRA includes 240 county or parish areas in Alabama, Arkansas, Illinois, Kentucky, Louisiana, Mississippi, Missouri and Tennessee. The goal of the Authority is to stimulate economic development and foster partnerships that will have a positive impact on the economy of the eight states that make up the Authority. Under the DRA's waiver program, physicians must submit an application processing fee; agree to practice in DRA designated shortage areas for a period of at least three years; and agree to pay $250,000 to the sponsoring facility if they do not fulfill any portion of their commitment, or $6,945 per month for each month they fail to fulfill their requirement. In 1994, Senator Kent Conrad sponsored the provision establishing the J-1 visa waiver program at the state level. The program is commonly referred to as the "Conrad State Program" program after him. Under the original program, participating states were allowed to sponsor up to 20 waiver applications for primary care physicians annually. To date, this provision has been extended several times. In 1996, the program was extended until 2002. Once again in 2002, the program was extended until 2004 and the number of waivers allowed per state was increased to 30. In 2004, Congress extended the Conrad program until June 1, 2006, and expanded the program to allow states to recruit primary care and specialty physicians. Other provisions of the law exempted waiver recipients from the H-1B annual cap, and allowed the states to place up to five physicians in facilities that serve patients living in designated shortage areas without regard to the facility's location. Previously, physicians could only serve in facilities located in designated shortage areas. In 2007, the program was extended through June 1, 2008. The waiver process for states is the same as other IGAs, however administration of the program varies by state. FMGs who are sponsored for a J-1 visa waiver by a state agree to practice medicine in designated shortage areas in the sponsoring state for a period of three to four years. FMGs working in these areas are not only required to meet the general requirements for medical licensing in the United States, but they are also required to meet state-specified licensing criteria. According to a 2006 Government Accountability Office (GAO) report on the J-1 program, states accounted for 90% of waiver requests, and had requested more than 3,000 waivers between 2003 and 2005. Several bills were introduced in the 110 th Congress that would have extended or expanded the Conrad Program. Ultimately, P.L. 110-362 extended the program through March 6, 2009. In an effort to extend the state J-1 waiver program for physicians, Representative Zoe Lofgren introduced H.R. 1127 on February 23, 2009, and it became public law on March 20, 2009. This law extends the waiver provision until September 30, 2009. On July 8, 2009, Senator Orrin Hatch introduced S.Amdt. 1428 to the Department of Homeland Security Appropriations Act ( H.R. 2892 ). The amendment, which passed unanimously on July 9, 2009, would extend the program through September 30, 2012. H.R. 2892 passed the Senate on July 9, 2009.

The Educational and Cultural Exchange Visitor program has become a gateway for foreign medical graduates (FMGs) to gain admission to the United States as nonimmigrants for the purpose of graduate medical education and training. The visa most of these physicians enter under is the J-1 nonimmigrant visa. Under the J-1 visa program, participants must return to their home country after completing their education or training for a period of at least two years before they can apply for another nonimmigrant visa or legal permanent resident (LPR) status, unless they are granted a waiver of the requirement. To qualify for a waiver, a request must be submitted on behalf of the FMG, by an Interested Government Agency (IGA), or a state Department of Health. In exchange, the FMG must agree to work in a designated healthcare professional shortage area for a minimum of three years. The ability of states to request a waiver is known as the "Conrad State Program," and was added temporarily to the Immigration and Nationality Act (INA) in 1994. The "Conrad State Program" has been extended by the past several Congresses. Most recently, the program was extended until September 30, 2009, by P.L. 111-9. This report will be updated as warranted by legislative developments.

In 1976, President Gerald R. Ford signed the Toxic Substances Control Act (15 U.S.C. 2601 et seq .; TSCA). Thirty-five years of experience with TSCA implementation and enforcement have demonstrated the strengths and weaknesses of the law and led many to propose legislative changes to TSCA's core provisions in Title I. On April 15, 2010, Senator Lautenberg introduced comprehensive legislation ( S. 3209 ) to amend TSCA, and Representatives Waxman and Rush posted draft TSCA reform legislation on the home page of the House Committee on Energy and Commerce. The latter House draft was subjected to stakeholder comments and critiques in a series of meetings during the spring. The proposal was revised and introduced July 22, 2010, as H.R. 5820 . This report compares key provisions of S. 3209 , as introduced, H.R. 5820 , as introduced, and current law. The major provisions of TSCA Title I are summarized in Tables 1 through 6. The first column of each table describes the provisions of TSCA Title I. The second and third columns summarize provisions of S. 3209 and H.R. 5820 , respectively, that are related to the TSCA provisions in the first column. New provisions that would be added to the end of TSCA Title I by one or both proposals—for example, those related to reduced use of animals for toxicity testing—are summarized in Table 6 . The basic organization of TSCA would be unaffected by the proposals. For example, provisions related to testing would still be in Section 4, requirements for notifying EPA when a new chemical or new use is proposed would still be in Section 5, and regulatory authorities would remain in Section 6. Also unaffected would be recently enacted changes, such as a provision that bans exports of elemental mercury. However, most of the original Title I provisions would be amended or deleted by the proposed legislation, and both proposals would make substantial changes to current law. For example, both proposals would shift the burden of demonstrating the safety of chemicals from the U.S. Environmental Protection Agency (EPA) to manufacturers and processors, and would prohibit manufacture, processing, and distribution of any chemical substance or mixture for any use for which safety had not been demonstrated to EPA's satisfaction. Exemptions from prohibitions would be allowed for particular uses only if a use was "in the paramount interest of national security"; lack of the chemical use "would cause significant disruption in the national economy"; the use was essential or critical and there was no safer feasible alternative; or the chemical use, relative to alternatives, provided a benefit to health, the environment, or public safety. In addition, the proposals would require data development and submission to EPA for all chemicals in commerce, rather than only for chemicals that EPA has found "may present an unreasonable risk of injury to health or the environment" and for which EPA has demonstrated a data need, as required under current law. The proposed amendments to TSCA would increase public access to information about EPA's decisions as well as to some information about chemicals that currently is treated as confidential business information. Based on the data received, EPA would be directed to target chemicals with particular characteristics (for example, persistence in the environment) for early evaluation and possible risk management. Once a chemical has been evaluated and EPA has determined whether (or under what conditions) use of the chemical was safe, the proposals would require risk management action to promptly reduce use of, or exposure to, the chemicals of highest concern, and to encourage development of "safer alternatives." Action would be expedited by allowing EPA to issue administrative orders instead of rules (which must be promulgated under current law), exempting certain EPA decisions from judicial review, and removing certain TSCA requirements that are in addition to requirements specified in the Administrative Procedure Act (5 U.S.C. 553) for notice and comment rulemaking. The scope of EPA oversight also would be expanded by S. 3209 and H.R. 5820 . Both include language that would allow EPA to define various distinct forms of substances that are the same in terms of molecular identity but differ in structure and function, such as manufactured nanoscale forms of carbon and silver. Both proposals also broaden the scope of environmental risks that EPA may manage to include risks found in the indoor environment; currently, TSCA applies only to chemicals in the ambient environment. The proposed amendments also appear to more clearly authorize EPA control of risks posed by articles formed from a substance. Both proposals would authorize EPA activities not currently authorized under TSCA to allow implementation of international agreements pertaining to persistent organic pollutants and other hazardous chemicals. For example, the proposals would authorize EPA to regulate chemicals manufactured solely for export. The authority provided by S. 3209 is specific to three international agreements, while the authority provided by H.R. 5820 applies more generally to any international agreement concerning chemicals. Both proposals would prohibit production and use of some chemicals, but S. 3209 prohibits production and use when it is inconsistent with U.S. obligations under the treaties that have entered into force for the United States. H.R. 5820 directs EPA to ban activities only for specified chemicals that are intentionally produced and are not already regulated under U.S. law. The effect of TSCA on state and local chemical laws also would be modified by the proposals. Current law, TSCA Section 18, generally does not preempt state laws. However, if EPA requires testing of a chemical under section 4, no state may require testing of the same substance for similar purposes. Similarly, if EPA prescribes a rule or order under section 5 or 6, no state or political subdivision may have a requirement for the same substance to protect against the same risk unless the state or local requirement is identical to the federal requirement, is adopted under authority of another federal law, or generally prohibits the use of the substance in the state or political subdivision. TSCA authorizes states and political subdivisions to petition EPA, and authorizes EPA to grant petitions, by rule, to exempt a law in effect in a state or political subdivision under certain circumstances. A petition may be granted if compliance with the requirement would not cause activities involving the substance to be in violation of the EPA requirement, and the state or local requirement provides a significantly higher degree of protection from the risk than the EPA requirement does, but does not "unduly burden interstate commerce." The proposed amendments would simplify this section of TSCA. S. 3209 provides that TSCA would not preempt laws relating to a chemical substance, mixture, or article unless they were less stringent than federal law. H.R. 5820 provides that the act does not affect the right of a state or locality to adopt or enforce its own requirements unless compliance with both the state or local requirements and TSCA is "impossible." Several novel provisions are included in both legislative proposals. One provision, for example, would require definition and listing of localities with populations that are "disproportionately exposed" to toxic chemicals. EPA would be directed to develop an action plan to reduce exposure in such "hot spots." Another provision would direct the EPA Administrator to coordinate with the Secretary of Health and Human Services to conduct a biomonitoring study to determine whether a chemical that research has indicated may be present in human biological substances and that may have adverse effects on human development in fact is present in pregnant women and infants. If the chemical is found to be present, manufacturers and processors must disclose to EPA, commercial customers, consumers, and the general public all known uses of the chemical and all articles in which the chemical is expected to be present. Children's environmental health also is addressed by the bills. Both proposals would establish a children's environmental health research program at EPA and an advisory committee to provide independent advice relating to implementation of TSCA and protection of children's health. The proposals also would establish at least four research centers to encourage the development of safer alternatives to existing hazardous chemical substances. "Green chemistry and engineering" also would be promoted through grants. Finally, the proposed amendments would direct EPA to minimize use of animals in toxicity testing. An advisory committee would be established to publish a list of testing methods that reduce use of animals. So-called "alternative testing methods" have been under development for many years, but remain a minor component of toxicity testing programs. The proposals differ in many details (which will not be discussed here) and in several noteworthy ways that are summarized in Tables 1 through 6. One significant difference is the length of time each proposal allows before all chemicals in commerce must be tested for toxicity. For all existing chemicals that have not been placed on a priority list, data sets must be submitted within 14 years of the date of enactment of S. 3209 . H.R. 5820 allows five years for data development. Another difference that may spur debate is the definition of the safety standard that chemicals are required to meet. H.R. 5820 would require that a chemical substance or mixture "is not reasonably anticipated to present a risk of injury to health or the environment," "provides a reasonable certainty of no harm, including to vulnerable populations," taking into account aggregate and cumulative exposure to a chemical, "and protects the public welfare from adverse effects, including effects on the environment." S. 3209 would require that EPA ensure "aggregate exposure and cumulative exposure of the general population or of any vulnerable population to the chemical substance or mixture presents a negligible risk of any adverse effect." Although they propose somewhat different safety standards, both proposals propose a health-based standard, which might generally discourage consideration of other factors, such as benefits of chemical use or costs of alternative chemicals in similar applications. (However, EPA would be authorized to consider such benefits and costs under certain circumstances. See in Table 4 under the heading "Exceptions to prohibitions and other restrictions" the description of TSCA 6(e) as it would be amended.) In contrast, current law requires that a chemical not pose "an unreasonable risk of injury to health or the environment," and that regulation should control any unreasonable risk to the extent necessary using the "least burdensome" means of available control. This TSCA standard has been interpreted to require cost-benefit balancing. The proposals also treat the identification of chemicals of highest concern differently. H.R. 5820 directs EPA to expedite action for 19 specified chemicals. S. 3209 leaves identification of such chemicals to the Administrator's discretion, directing her to "act quickly to manage risks from chemical substances that clearly pose the highest risks to human health or the environment." Finally, only H.R. 5820 addresses "persistent, bioaccumulative, and toxic" chemicals (PBTs) directly. The bill directs EPA to promulgate a rule establishing criteria for identifying PBTs and requires listing of all PBTs within 18 months of enactment and every three years thereafter. EPA is required to impose conditions on the manufacture, processing, distribution, use, and disposal of PBTs to achieve the "greatest practicable reductions in exposure." EPA then is required to conduct the safety evaluation for all PBTs and to impose further risk management controls as needed. These and other similarities and differences are summarized in Tables 1 through 6.

On April 15, 2010, Senator Lautenberg introduced legislation (S. 3209) to amend the core provisions of the Toxic Substances Control Act (TSCA) Title I. Representatives Waxman and Rush introduced comprehensive legislation to amend TSCA (H.R. 5820) on July 22, 2010. This report compares key provisions of S. 3209, as introduced, H.R. 5820, as introduced, and current law (15 U.S.C. 2601 et seq.). Both bills would amend the 35-year-old law to shift the burden of demonstrating safety for chemicals in commerce from the U.S. Environmental Protection Agency (EPA) to manufacturers and processors of chemicals. Both bills also would prohibit manufacture, processing, and distribution of any chemical substance or mixture for which safety has not been demonstrated. Although they propose somewhat different safety standards for EPA to enforce, both bills suggest a health-based standard. In contrast, current law requires that a chemical not pose "an unreasonable risk of injury to health or the environment," and that any regulation should control unreasonable risk to the extent necessary using the "least burdensome" means of available control. This TSCA standard has been interpreted to require cost-benefit balancing. To facilitate safety assessment, the proposals would require data development and submission to EPA for all chemicals in commerce. TSCA amendments would direct EPA to target chemicals with particular characteristics (for example, persistence in the environment) for earlier evaluation and possible risk management. Any regulatory action would be expedited, for example, by allowing EPA to issue orders rather than rules. The bills also would add new sections to TSCA. Of particular significance is a section authorizing actions that would allow U.S. implementation of three international agreements, which the United States has signed but not yet ratified. Other new sections would provide authority for EPA to support research in so-called "green" engineering and chemistry, promote alternatives to toxicity testing on animals, encourage research on children's environmental health, and require biomonitoring of pregnant women and infants. A "hot spots" provision would require EPA to identify locations where residents are disproportionately exposed to pollution and to develop strategies for reducing their risks. The proposals differ in many details and in several noteworthy ways. For example, for all existing chemicals that have not been placed on a priority list, data sets must be submitted within 14 years of the date of enactment of S. 3209, but within five years of enactment of H.R. 5820. The proposals also treat the identification of chemicals of highest concern differently. H.R. 5820 directs EPA to expedite action for 19 specified chemicals, while S. 3209 leaves identification of such chemicals to the Administrator's discretion. These and other provisions of the two legislative proposals are compared with current law in Tables 1 through 6.

The United States is a member of five multilateral development banks (MDBs): the World Bank, African Development Bank (AfDB), Asian Development Bank (AsDB), European Bank for Reconstruction and Development (EBRD), and Inter-American Development Bank (IDB). It also belongs to two similar organizations, the International Fund for Agricultural Development (IFAD) and the North American Development Bank (NADBank). The World Bank also administers trust funds, focused on particular global issues such as food security and the environment. The MDBs have similar programs, though they all differ somewhat in their institutional structure and emphasis. Each has a president and executive board that manages or supervises all of its programs and operations. Except for the EBRD, which makes only market-based loans, all the MDBs make both market-based loans to middle-income developing countries and concessional loans to the poorest countries. Their loans are made to governments or to organizations having government repayment guarantees. In each MDB, the same staff prepares both the market-based and the concessional loans, using the same standards and procedures for both. The main differences between them are the repayment terms and the countries which qualify for them. The MDBs also have specialized facilities which have their own operating staff and management but report to the bank's president and executive board. The World Bank's International Finance Corporation (IFC) and the IDB's Inter-American Investment Corporation (IIC) make loans to or equity investments in private-sector firms in developing countries (on commercial terms) without government repayment guarantees. The AsDB makes similar loans from its market-rate loan account. The World Bank's Multilateral Investment Guarantee Agency (MIGA) underwrites private investments in developing countries (on commercial terms) to protect against noneconomic risk. At the IDB, the Multilateral Investment Fund (MIF) helps Latin American countries institute policy reforms aimed at stimulating domestic and international investment. It also funds worker retraining and programs for small and micro-enterprises. The MIF originated as part of President Bush's 1990 Enterprise for the Americas Initiative (EAI). The NADBank was created by the North American Free Trade Agreement (NAFTA) to fund environmental infrastructure projects in the U.S.-Mexico border region. The International Fund for Agricultural Development (IFAD), created in 1977, focuses on reducing poverty and hunger in poor countries through agricultural development. Finally, the World Bank also serves as the trustee for several targeted multilateral development funds, for which the Administration has requested and Congress has appropriated funds. These multilateral funds include the Clean Technology Fund (CTF), the Strategic Climate Fund (SCF), the Global Environment Facility (GEF), and the Global Agriculture and Food Security Program (GAFSP). The MDBs' concessional aid programs are funded with money donated by their wealthier member country governments. Periodically, as the stock of uncommitted MDB funds begins to run low, the major donors negotiate a new funding plan that specifies their new contribution shares. Loans from the MDBs' market-rate loan facilities are funded with money borrowed in world capital markets. The IFC and IIC fund their loans and equity investments partly with money contributed by their members and partly with funds borrowed from commercial capital markets. The MDBs' borrowings are backed by the subscriptions of their member countries. They provide a small part of their capital subscriptions (3% to 5% of the total for most MDBs) in the form of paid-in capital. The rest they subscribe as callable capital. Callable capital is a contingent liability, payable only if an MDB becomes bankrupt and lacks sufficient funds to repay its own creditors. It cannot be called to provide the banks with additional loan funds. Countries' voting shares are determined mainly by the size of their contributions. The United States is the largest stockholder in most MDBs, and has maintained this position to preserve veto power in some institutions over major policy decisions. Figure 1 , Figure 2 , and Tables 1-4 show the amounts the Administration has requested and Congress has appropriated annually since FY2000 to the multilateral development banks. Note that the figures and tables do not include callable capital. Since the early 1980s, Congress has authorized but not appropriated callable capital. As Figure 1 illustrates, appropriations to the MDBs increased dramatically starting in 2009, from $1.28 billion in 2008 to a peak of $2.67 billion in FY2014. The uptick was driven largely by capital increases for the nonconcessional lending facilities at the MDBs in response to the global financial crisis, as well as the proliferation of trust funds administered by the World Bank focused on specific policy issues. As these commitments have been met, particularly in funding the capital increases at the MDBs, overall funding levels started declining. Appropriations have declined over the past three fiscal years to $1.52 billion in FY2018. President Trump campaigned on an "America First" platform and has signaled a reorientation of U.S. foreign policy. In March 2017, the Trump Administration proposed cutting $650 million over three years compared to the commitments made under the Obama Administration. For FY2019, the Trump Administration requested $1.42 billion for the MDBs, a 16% cut from the amount appropriated in FY2017. The bulk of the request—$1.32 billion, about 90%—would fund U.S. commitments to concessional lending facilities at the MDBs, particularly IDA. The request also includes funding toward the capital increase at the AfDB, multilateral trust funds focused on environmental issues, and international food security programs.

This report shows in tabular form how much the Administration requested and how much Congress appropriated for U.S. payments to the multilateral development banks (MDBs) since 2000. Multilateral development banks provide financial assistance to developing countries in order to promote economic and social development. The United States belongs to several multilateral development banks, including the World Bank and four regional development banks (the African Development Bank, the Asian Development Bank, the Inter-American Development Bank, and the European Bank for Reconstruction and Development). It also belongs to the North American Development Bank, which is a binational (U.S.-Mexico) development bank; the International Fund for Agricultural Development, which focuses on poverty and hunger in developing countries; and several trust funds administered by the World Bank, which focus on specific global issues, such as food security and the environment. The United States appropriates funding on an annual basis to various multilateral development banks and related funds. In FY2018, U.S. appropriations for MDB programs totaled $1.5 billion. Most of the FY2018 funding (about 90%) went to the concessional lending facilities at the MDBs, which provide grants and low-cost loans to the world's poorest countries. Congress also provided funding for the African Development Bank, IFAD, and the Global Environmental Facility (GEF), administered by the World Bank. The Treasury Department manages U.S. participation in the MDBs, and the Administration's request is submitted as part of Treasury International Programs. For FY2019, the Administration has requested $1.4 billion for the MDBs and related funds. Most of the funding would go to the concessional lending facilities at the World Bank, the African Development Bank, and the Asian Development Bank. It would also provide funding for the African Development Bank. The Administration has proposed cutting U.S. contributions to IFAD and reducing U.S. contributions to the GEF. For further information about the MDBs and relevant U.S. policy process, see the following CRS reports: CRS Report R41170, Multilateral Development Banks: Overview and Issues for Congress, by [author name scrubbed]; CRS Report R41537, Multilateral Development Banks: How the United States Makes and Implements Policy, by [author name scrubbed] and [author name scrubbed]; CRS In Focus IF10144, The Global Environment Facility (GEF), by [author name scrubbed]; and CRS Report R44890, Department of State, Foreign Operations, and Related Programs: FY2018 Budget and Appropriations, by [author name scrubbed], [author name scrubbed], and [author name scrubbed]

Medicaid is a means-tested entitlement program that finances the delivery of primary and acute medical services as well as long-term services and supports. Medicaid is jointly funded by the federal government and the states. Participation in Medicaid is voluntary for states, though all states, the District of Columbia, and the territories choose to participate. Each state designs and administers its own version of Medicaid under broad federal rules. While states that choose to participate in Medicaid must comply with all federal mandated requirements, state variability is the rule rather than the exception in terms of eligibility levels, covered services, and how those services are reimbursed and delivered. The federal government pays a share of each state's Medicaid expenditures. This report describes the federal medical assistance percentage (FMAP) calculation used to reimburse states for most Medicaid expenditures, and it lists the statutory exceptions to the regular FMAP rate. The federal government's share of most Medicaid service costs is determined by the FMAP rate, which varies by state and is determined by a formula set in statute. The FMAP rate is used to reimburse states for the federal share of most Medicaid expenditures, but exceptions to the regular FMAP rate have been made for certain states, situations, populations, providers, and services. The FMAP rate is also used in determining the phased-down state contribution ("clawback") for Medicare Part D, the federal share of certain child support enforcement collections, Temporary Assistance for Needy Families (TANF) contingency funds, a portion of the Child Care and Development Fund (CCDF), and foster care and adoption assistance under Title IV-E of the Social Security Act. An enhanced FMAP (E-FMAP) rate is provided for both services and administration under the State Children's Health Insurance Program (CHIP), subject to the availability of funds from a state's federal allotment for CHIP. The E-FMAP rate is calculated by reducing the state share under the regular FMAP rate by 30%. The FMAP formula compares each state's per capita income relative to U.S. per capita income. The formula provides higher reimbursement to states with lower incomes (with a statutory maximum of 83%) and lower reimbursement to states with higher incomes (with a statutory minimum of 50%). The formula for a given state is: FMAP state = 1 - ((Per capita income state ) 2 /(Per capita income U.S. ) 2 * 0.45) The use of the 0.45 factor in the formula is designed to ensure that a state with per capita income equal to the U.S. average receives an FMAP rate of 55% (i.e., state share of 45%). In addition, the formula's squaring of income provides higher FMAP rates to states with below-average incomes (and vice versa, subject to the 50% minimum). The Department of Health & Human Services (HHS) usually publishes FMAP rates for an upcoming fiscal year in the Federal Register during the preceding November. This time lag between announcement and implementation provides an opportunity for states to adjust to FMAP rate changes. The per capita income amounts used to calculate FMAP rates for a given fiscal year are several years old by the time the FMAP rates take effect because, as specified in Section 1905(b) of the Social Security Act, the per capita income amounts used in the FMAP formula are equal to the average of the three most recent calendar years of data available from the Department of Commerce. In its FY2019 FMAP calculations, HHS used state per capita personal income data for 2014, 2015, and 2016 that became available from the Department of Commerce's Bureau of Economic Analysis (BEA) in September 2017. The use of a three-year average helps to moderate fluctuations in a state's FMAP rate over time. BEA revises its most recent estimates of state per capita personal income on an annual basis to incorporate revised and newly available source data on population and income. It also undertakes a comprehensive data revision—reflecting methodological and other changes—every few years that may result in upward and downward revisions to each of the component parts of personal income. These components include the following: earnings (wages and salaries, employer contributions for employee pension and insurance funds, and proprietors' income); dividends, interest, and rent; and personal current transfer receipts (e.g., government social benefits such as Social Security, Medicare, Medicaid, state unemployment insurance). As a result of these annual and comprehensive revisions, it is often the case that the value of a state's per capita personal income for a given year will change over time. For example, the 2014 state per capita personal income data published by BEA in September 2013 (used in the calculation of FY2017 FMAP rates) differed from the 2014 state per capita personal income data published in September 2017 (used in the calculation of FY2019 FMAP rates). It should be noted that the definition of personal income used by BEA is not the same as the definition used for personal income tax purposes. Among other differences, BEA's personal income excludes capital gains (or losses) and includes transfer receipts (e.g., government social benefits), while income for tax purposes includes capital gains (or losses) and excludes most of these transfers. Several factors affect states' FMAP rates. The first is the nature of the state economy and, to the extent possible, a state's ability to respond to economic changes (i.e., downturns or upturns). The impact on a particular state of a national economic downturn or upturn will be related to the structure of the state economy and its business sectors. For example, a national decline in automobile sales, while having an impact on all state economies, will have a larger impact in states that manufacture automobiles as production is reduced and workers are laid off. Second, the FMAP formula relies on per capita personal income in relation to the U.S. average per capita personal income . The national economy is basically the sum of all state economies. As a result, the national response to an economic change is the sum of the state responses to economic change. If more states (or larger states) experience an economic decline, the national economy reflects this decline to some extent. However, the national decline will be lower than some states' declines because the total decline has been offset by states with small decreases or even increases (i.e., states with growing economies). The U.S. per capita personal income, because of this balancing of positive and negative, has only a small percentage change each year. Since the FMAP formula compares state changes in per capita personal income (which can have large changes each year) to the U.S. per capita personal income, this comparison can result in significant state FMAP rate changes. In addition to annual revisions of per capita personal income data, comprehensive revisions undertaken every four to five years may also influence regular FMAP rates (e.g., because of changes in the definition of personal income). The impact on FMAP rates will depend on whether the changes are broad (affecting all states) or more selective (affecting only certain states or industries). Regular FMAP rates for FY2019 (the federal fiscal year that begins on October 1, 2018) were calculated and published November 21, 2017, in the Federal Register . In the Appendix A to this report, Table A-1 shows regular FMAP rates for each of the 50 states and the District of Columbia for FY2014 through FY2019. Figure 1 shows the state distribution of regular FMAP rates for FY2019. Fourteen states are to have the statutory minimum FMAP rate of 50.00%, and Mississippi is to have the highest FMAP rate of 76.39%. As shown in Figure 2 , from FY2018 to FY2019, the regular FMAP rates for 36 states is to change, whereas the regular FMAP rates for the remaining 15 states (including the District of Columbia) is to remain the same. For most of the states experiencing an FMAP rate change from FY2018 to FY2019, the change is to be less than one percentage point. The regular FMAP rate for 14 states is to increase by as much as one percentage point, and the FMAP rate for 12 states is to decrease by as much as one percentage point. For states that are to experience an FMAP rate change greater than one percentage point from FY2018 to FY2019, nine states are to experience an FMAP rate increase of greater than one percentage point. Oklahoma is to have the largest FMAP rate increase of 3.81 percentage points, with the FMAP rate increasing from 58.57% to 62.38% Oregon is the only state that is to experience an FMAP rate decrease of greater than one percentage point, with the FMAP rate decreasing 1.06 percentage points from 63.62% to 62.56%. The District of Columbia's FY2019 FMAP rate was not calculated according to the regular FMAP formula because the FMAP rate for the District of Columbia has been set in statute at 70% since 1998 for the purposes of Title XIX and XXI of the Social Security Act. However, for other purposes, the percentage for the District of Columbia is 50%, unless otherwise specified by law. Although FMAP rates are generally determined by the formula described above, exceptions to the regular FMAP rate have been made for certain states, situations, populations, providers, and services. Table 1 lists current exceptions to the FMAP in Medicaid statute and regulations. Past FMAP exceptions are listed in Table B-1 . Some of these exceptions were included in the Social Security Amendments of 1965 (P.L. 89-97), which is the law that enacted the Medicaid program. Other exceptions have been added over the years. The Patient Protection and Affordable Care Act (ACA; P.L. 111-148 , as amended) added a number of exceptions to the FMAP for "newly eligible" individuals, "expansion states," disaster-affected states, specified preventive services and immunizations, smoking cessation services for pregnant women, specified home and community-based services, health home services for certain people with chronic conditions, and home- and community-based attendant services and supports. The FMAP rate is used to reimburse states for the federal share of most Medicaid expenditures. In FY2019, 13 states are to have the statutory minimum FMAP rate of 50%, and Mississippi is to have the highest FMAP rate of 76.39%. From FY2018 to FY2019, the regular FMAP rates for 36 states is to change, while the regular FMAP rates for the remaining 15 states (including the District of Columbia) is to remain the same. Exceptions to the regular FMAP rate have been made for certain states, situations, populations, providers, and services. The ACA added a number of exceptions to the FMAP for "newly eligible" individuals, "expansion states," disaster-affected states, specified preventive services and immunizations, smoking cessation services for pregnant women, specified home and community-based services, health home services for certain people with chronic conditions, and home and community-based attendant services and supports. The federal share of Medicaid expenditures used to be about 57% in a typical year, which meant the state share was about 43%. However, with the exceptions to the FMAP added by the ACA (mainly the "newly eligible" matching rate), the federal share of Medicaid expenditures has increased. In FY2014, the federal share of Medicaid expenditures was 61% on average, and it is estimated to have increased to 63% for FY2015 and FY2016. The average federal share is expected to decrease to 61% by FY2020 as the "newly eligible" matching rate phases down to 90%. Appendix A. FMAP Rates for Medicaid, by State Table A-1 shows regular FY2014-FY2019 FMAP rates calculated according to the formula described in the text of the report (see " How FMAP Rates Are Calculated "). In FY2019, FMAP rates range from 50% (14 states) to 76% (Mississippi). From FY2018 to FY2019, regular FMAP rates are to decrease for 13 states, increase for 23 states, and remain the same for 15 states (including the District of Columbia). Most of the states (14 states) for which the FMAP rates do not change have the statutory minimum FMAP rate of 50%, and the FMAP rate for the District of Columbia is statutorily set at 70%. Appendix B. Past FMAP Rate Exceptions Although FMAP rates are generally determined by the statutory formula described above, Table 1 lists current exceptions that have been added to the Medicaid statute and regulations over the years, and Table B-1 lists past FMAP exceptions.

Medicaid is a means-tested entitlement program that finances the delivery of primary and acute medical services as well as long-term services and supports. Medicaid is jointly funded by the federal government and the states. The federal government's share of most Medicaid expenditures is called the federal medical assistance percentage (FMAP). The remainder is referred to as the state share. Generally determined annually, the FMAP formula is designed so that the federal government pays a larger portion of Medicaid costs in states with lower per capita incomes relative to the national average (and vice versa for states with higher per capita incomes). FMAP rates have a statutory minimum of 50% and a statutory maximum of 83%. For FY2019, regular FMAP rates range from 50.00% to 76.39%. The FMAP rate is used to reimburse states for the federal share of most Medicaid expenditures, but exceptions to the regular FMAP rate have been made for certain states, situations, populations, providers, and services. This report describes the FMAP calculation used to reimburse states for most Medicaid expenditures, and it lists the statutory exceptions to the regular FMAP rate.

Over the course of three days in late September 2008, all three of Japan's major parties will hold leadership elections. The largest opposition party, the Democratic Party of Japan (DPJ) will go first, on September 21. Current party head Ichiro Ozawa, who is completing his two-year term as president, is running unopposed. The following day, the ruling Liberal Democratic Party (LDP) will hold its internal election, with the winner set to assume Japan's premiership by virtue of the LDP's majority in the Lower House, the more powerful of Japan's two parliamentary chambers. As discussed in more detail below, five LDP members have declared their candidacy. Finally, on September 23, the LDP's coalition partner, New Komeito, will hold its election, with incumbent Akihiro Ota widely expected to stay on. In late September or early October, the new prime minister is expected to dissolve the chamber and schedule an early general election for early November in order to renew the ruling party's mandate. By law, the Lower House election does not need to be held until September 2009. Various polls indicate that the race is likely to be competitive. Both the LDP and the DPJ's approval ratings generally are in the 20-30% range. Most observers predict that the LDP-led coalition is unlikely to maintain its two-thirds majority in the Lower House, which would deprive the LDP of its ability to override vetoes by the DPJ-led Upper House and potentially usher in a new era for Japanese politics. The economy is expected to be the major policy issue of the anticipated general election. Specifically, debate is expected to focus on four inter-related items: whether and how to revive Japan's sputtering economy, how to support Japan's social security system as it copes with the strain of a rapidly ageing society, whether and when to raise the consumption tax rate from its current level of 5%, and how aggressively to pursue structural economic reforms such as those championed by former Prime Minister Junichiro Koizumi, who served from 2001-2006. Hanging over all these questions is Japan's high level of government debt; the country's debt-to-GDP ratio is the highest among the world's industrialized countries. Thus far, five candidates have announced their intention to run for the LDP's presidency. Taro Aso (67 years old) is widely considered to be the front-runner. A former Foreign Minister and current Secretary General of the LDP, he is by far Japan's most popular politician. To temporarily reinvigorate the economy, he has emphasized the need to increase government spending, much as Tokyo did during the 1990s, and has said that raising the consumption tax should be postponed until the economy revives. Aso is known as a foreign policy hawk. He has strongly advocated revising the "peace clause" (Article 9) of the Japanese constitution to allow Japan to more easily deploy its Self-Defense Forces overseas. During his stint as Foreign Minister (2005-2006), he and then-Prime Minister Shinzo Abe tried to deepen Japan's alliance with the United States. They also touted a "values-based diplomacy" that called for expanded cooperation with democracies in Asia, particularly the United States, Australia, and India. Aso has a reputation as a "revisionist" on historical issues, which could lead to tensions with China and South Korea if he becomes prime minister. In the past, Aso has praised some aspects of Japan's colonization of Asian countries in the first part of the 20 th century and voiced support for official visits to Yasukuni Shrine. Visits by former leaders to the controversial Shinto shrine that honors Japan's war dead—including several convicted Class A war criminals—have severely strained relations with China and other Asian countries. Other candidates include current Economic and Fiscal Policy Minister Kaoru Yosano (70), a strong opponent of increased government spending who argues that the consumption tax must be raised in order to save the national pension system. Former Defense Minister and popular television anchor Yuriko Koike (56), a proponent of re-energizing the government's structural reforms championed by Koizumi, is the first woman to run for the LDP Presidency. Former Transportation Minister and LDP policy chief Nobuteru Ishihara (51), the son of the popular mayor of Tokyo, also favors structural reforms. Another former Defense Minister, Shigeru Ishiba (51), favors increased government spending and is emphasizing his plan to enact a permanent law enabling Japan to dispatch the Self-Defense Forces overseas whenever necessary. If Lower House elections are held in the near future, the DPJ is expected to use the same strategy of emphasizing economic and social issues that propelled it to victory in the July 2007 elections for the Upper House of Japan's Diet. Ozawa has unveiled a highly populist policy blueprint that includes items such as providing income support to farmers and fishermen; abolishing certain provisional taxes; and reforming the national pension and healthcare systems. He would offset the over 18 trillion yen (over $160 billion) in revenue shortfalls by eliminating or trimming what he has called "wasteful" government programs that are funded through various "special accounts." Ozawa also has outlined measures to reduce bureaucrats' influence over politicians and has called for Japanese troops to participate in U.N. peacekeeping operations. Though Ozawa is not popular in opinion polls, he is respected in his party for his campaign prowess. Analysts point to a number of possible outcomes from the ongoing political turbulence. One possibility is continued paralysis, particularly if the LDP wins the Lower House elections but loses its 2/3 majority. A DPJ victory, while signifying the emergence of a true two-party system in Japan, could usher in a period of fundamental adjustment to policies that have remained static for decades under the LDP. Two other scenarios are a "Grand Coalition" and a political realignment, in which members of either party defect to the other and form a new majority. Before the elections, however, most analysts are reluctant to speculate specifically on how these scenarios might unfold. A number of factors impeded Fukuda's ability to govern and will challenge whomever the LDP chooses as his successor. In July 2007, the DPJ won a majority in nationwide elections for the Upper House of the Diet. As a result, for the first time in Japanese history, Japan's two parliamentary chambers are controlled by different parties. Shortly after the DPJ's victory, then-prime minister Shinzo Abe resigned, leading the LDP to select Fukuda as premier. Concerned by Ozawa's threats to veto major legislation, Fukuda attempted to form a "Grand Coalition" with the DPJ. After the talks broke down, the DPJ adopted an aggressive policy of using its control of the Upper House to block or delay several of the Fukuda government's legislative initiatives. For more than a decade, the LDP generally has not been able to secure independent majorities in both Diet chambers, forcing it to rely upon coalitions with smaller parties. Since 1999, the LDP has formed a governing coalition with the New Komeito party, a pacifist-leaning party with strong ties to the Buddhist Soka Gakkai religious group. Komeito's clout in the coalition has increased over time, for at least two reasons. First, the LDP is reliant upon Komeito to obtain the 2/3 majority in the Lower House to override the DPJ-led vetoes in the Upper House. Second, LDP candidates in many electoral districts have become reliant upon support from Soka Gakkai followers. Although traditionally the LDP has dominated the coalition, during the summer of 2008, New Komeito became more assertive, for instance by resisting Fukuda's push to renew the authorization to provide fuel to coalition forces in Afghanistan (see later section for details). Former Prime Minister Junichiro Koizumi significantly weakened the LDP's old, opaque system, in which the leaders of the party's internal factions made major budgetary, policy, and personnel decisions (including deciding who would serve as prime minister). This system, although widely criticized as lacking transparency, helped the LDP to overcome significant internal divisions over policy. While he was breaking the faction-based system, Koizumi used his personal popularity and aggressiveness to enforce party discipline. However, his successors, Abe and Fukuda, often were unable to duplicate this feat. As a result, decision-making became increasingly difficult on contentious matters, such as the battles between the LDP's economic reformers and those favoring a return to the status quo of channeling government funds toward key interest groups. The DPJ was formed in 1998 as a merger of four smaller parties and was later joined by a fifth grouping. The amalgamated nature of the DPJ has led to considerable internal contradictions, primarily between the party's hawkish/conservative and passivist/liberal wings. In particular, the issues of deploying Japanese troops abroad and revising the war-renouncing Article 9 of the Japanese constitution have generated considerable internal debate in the DPJ. As a result, for much of its history, the DPJ has a reputation of not being able to formulate coherent alternative policies to the LDP. Additionally, battles between various party leaders have weakened the party. Since winning the Upper House, however, the party has appeared much more unified, at least on the strategy of using its veto power to try to force the LDP to hold early elections. This discipline is remarkable considering that, privately and publicly, many DPJ members chafe at Ozawa's top-down leadership style. If the DPJ does worse than expected in the next election, it is likely that he will be forced to step down. In general, U.S. interests are likely to be negatively affected by political gridlock in Tokyo. In the first term of the Bush Administration, Japan was lauded as the "pivot" of the U.S. strategic presence in Asia and a reliable partner in the global war on terrorism. Continued ineffective leadership, however, suggests that Japan will avoid taking political risks to support U.S. global efforts. Stalled or protracted decision-making may further frustrate U.S. managers working on a range of economic, diplomatic, and military coordination with Japan. Although most analysts view the U.S.-Japan security alliance as mutually beneficial and fundamentally sound, an erosion of trust between Washington and Tokyo could constrain both capitals from weathering occasional controversies. Regardless of which party or candidate takes power, Tokyo is likely to focus most attention on domestic issues in the near future. Little progress is expected on a suite of reforms that had been pursued by Abe and encouraged by U.S. officials to enhance Japan's ability to contribute to international security. These proposals include revision of Article 9 of Japan's constitution, reinterpretation of the constitution to allow collective self-defense, and a law that would allow the Self Defense Forces to deploy without passage of special legislation. Given the emphasis on reforming the pension and health care systems, the new leadership is unlikely to put its energy and resources into passage of controversial foreign policy legislation. The political gridlock in Tokyo does not bode well for the continuation of Japanese support of the U.S.-led Operation Enduring Freedom (OEF) in Afghanistan. Beginning in 2001, Japan's Marine Self Defense Force (MSDF) provided fuel (over 130 million gallons, according to the Japanese government) and water from its tankers in the Indian Ocean to coalition forces. After the DPJ took control of the Upper House in the July 2007 elections, it and the other opposition parties in the Upper House voted down the "Anti-terrorism Special Measures Law" authorization, creating a gap in MSDF participation. Eventually, the LDP-New Komeito coalition used its two-thirds majority in the Lower House, to overrule the Upper House's rejection of the bill. The current measure expires on January 15, 2009. Although all five LDP candidates have stated support for the measure's renewal, the parliamentary calendar and New Komeito's apparent reluctance to back the extension point to at least an interruption of the re-fueling. In summer 2008, the Japanese government explored and then appeared to rule out sending a team of Japanese ground troops to participate in humanitarian activities in Afghanistan. A deployment is likely to be controversial for the pacifist-leaning Japanese public and is particularly opposed by the New Komeito Party. Although the DPJ opposes the refueling operations, it does so on the grounds that the operations fall under the U.S.-led OEF and is not authorized by the United Nations. DPJ leader Ozawa in the past has voiced support for Japanese participation in a Provincial Reconstruction Team (PRT) in Afghanistan because it is specifically authorized by the United Nations. Some analysts have speculated that Japan may be waiting to see how much emphasis the new U.S. president puts on Afghanistan before taking the political risk of sending ground troops. Political shifts in Japan since 2006 appear to have slowed some of the increased cooperation in the U.S.-Japan alliance. Implementation of a series of bilateral agreements intended to upgrade the alliance (known as the "2+2" agreements) depends on Tokyo providing the necessary resources and political capital. Because the transformation and realignment initiatives involve elements that are unpopular in the localities affected, successful implementation hinges on leadership from the central government. The centerpiece of the realignment scheme involves the relocation of a controversial Marine Corps air station in Futenma to a less-congested part of Okinawa. The agreement faces significant public opposition and environmental concerns. If implementation falters, the planned move of 8,000 Marines from Okinawa to Guam may also disrupt the Pentagon's overall plans for realigning U.S. forces in Asia. Japan's relations with its neighbors, while mixed, appear to be the least likely area of concern to be affected by the current political turmoil. Leaders in the various political parties do not have explicitly distinct agendas for dealing with the Koreas and China. After a period of tension under Koizumi, politicians in both Tokyo and Beijing appear to have recognized the necessity of maintaining friendly relations in the interest of regional stability and continued robust trade. Most analysts think that even Aso, who is known as a nationalist politician, is likely to follow Abe and Fukuda's lead and avoid provoking China. After some positive trends, Japan-South Korean ties have faltered again due to delicate sovereignty issues and, according to many analysts, a lack of high-level attention to Seoul in Tokyo. North Korea-Japan relations may have been affected by Fukuda's resignation: soon after Fukuda's announcement, Pyongyang postponed its promised reinvestigation into the fates of Japanese citizens its agents had kidnapped in the 1970s and 1980s until a new prime minister is chosen. Progress on the abduction issue may have slowed even without the political uncertainty in Japan, as the Six-Party Talks over North Korea's nuclear program have struggled to make progress.

On September 1, 2008, Japanese Prime Minister Yasuo Fukuda stunned observers by resigning his post, saying that a new leader might be able to avoid the "political vacuum" that he faced in office. Fukuda's 11-month tenure was marked by low approval ratings, a sputtering economy, and virtual paralysis in policymaking, as the opposition Democratic Party of Japan (DPJ) used its control of the Upper House of Japan's parliament (the Diet) to delay or halt most government proposals. On September 22, the ruling Liberal Democratic Party (LDP) will elect a new president, who will become Japan's third prime minister in as many years. Ex-Foreign Minister Taro Aso, a popular figure known for his conservative foreign policy credentials and support for increased deficit spending, is widely expected to win. Many analysts expect that the new premier will dissolve the Lower House and call for parliamentary elections later in the fall. As a result, Japanese policymaking is likely to enter a period of disarray, which could negatively affect several items of interest to the United States, including the passage of budgets to support the realignment of U.S. forces in Japan and the renewal of legislation that authorizes the deployment of Japanese navy vessels that are refueling ships supporting U.S.-led operations in Afghanistan. This report analyzes the factors behind and implications of Japan's current political turmoil. It will be updated as warranted by events.

Lack of regular dental care can result in pain, infection, and delayed diagnosis of oral diseases. During the 2001-2004 period, one-fourth to one-third of children ages 2 to 19 in families with income below 200% of the federal poverty level (FPL) experienced untreated dental caries (decay), a sign that needed dental care was not received. In 2005, about one-third of all children living below 200% FPL did not have a recent dental visit. In a related study, GAO found that during the 1999-2004 period, roughly one in three Medicaid children ages 2 through 18 had untreated tooth decay, and data from 2004 through 2005 indicated that only 37% received any dental care over a one-year period. With respect to receipt of dental services, insurance matters. In 2006, 50.9% of individuals under the age of 21 in the United States had private dental coverage, another 30.4% had public dental coverage (primarily Medicaid and SCHIP), and 18.7% had no dental coverage. The percentage of individuals under age 21 that had a dental visit in 2006 varied by type of coverage—58.0% with private dental coverage had a dental visit that year, compared with 35.1% of those with public dental coverage and 26.3% of the subgroup with no dental coverage. The American Academy of Pediatric Dentistry (AAPD) recommends that every child be seen by a dentist following the eruption of the first tooth, but not later than 12 months of age. All other children should have additional periodic dental exams every six months (i.e., twice a year). Under Medicaid, states must adopt a dental periodicity schedule, which can be state-specific based on consultation with dental groups, or may be based on nationally recognized dental periodicity schedules, such as the AAPD's guidelines. One goal of the Healthy People 2010 initiative, a federal effort to increase quality and years of healthy life and eliminate health disparities, is that at least 66% of low-income children receive a preventive dental visit each year. Most Medicaid children under age 21 are entitled to Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) services. The Medicaid statute (Section 1905(r)) defines required EPSDT screening services to include dental services that, at a minimum, include relief of pain and infections, restoration of teeth, and maintenance of dental health. In addition, care that is necessary to correct or ameliorate identified problems must also be provided, including services that states do not otherwise cover in their Medicaid programs. Beneficiary cost-sharing for services such as dental care is prohibited for children under age 18, and is optional for those ages 18-20. Federal law is intended to eliminate or significantly reduce major barriers to dental services for Medicaid children. Nonetheless, the research literature has identified several factors that affect the use of dental services among children. From a beneficiary perspective, barriers include, for example, ability to pay for care, navigating government assistance programs, finding a dentist who will accept Medicaid, locating a dentist close to home (especially in inner-city and rural areas), getting to a dentist office, cultural or language barriers, and lack of knowledge about the need for periodic oral health care. Most of the dental care provided in the United States is delivered by private dentists. In contrast to physician services, about half of all payments for dental services are made out-of-pocket, rather than through insurance. In addition, overhead in dental practices is high, averaging about 60 cents for every dollar earned, due in part to the need for expensive equipment. New dentists also face substantial debt because of the high cost of dental education. While there are questions about whether there is an overall shortage of dentists in the United States, there is general agreement that too few provide services to those who are publicly funded and those with special needs. Federal Medicaid law and regulations require that payment rates be sufficient to enlist enough providers so that services are available at least to the same extent that such services are available to the general population in the geographic area. Nonetheless, reimbursement rates are an obstacle to such participation. In addition to reimbursement rates, dentists typically cite two other reasons for their low participation rates in Medicaid: burdensome administrative requirements and patient behavior (e.g., infrequent care-seeking behavior and high no-show rates for dental appointments). A recent study of physicians also shows a negative relationship between administrative issues (delays in receiving payments) and participation in Medicaid. The Medicaid statute (Section 1902(a)(43)) requires states to inform and arrange for the delivery of EPSDT services to eligible children, and also includes annual reporting requirements for states. The tool used to capture these required EPSDT data is called the CMS-416 form. The current CMS-416 form (effective as of FY1999) includes the unduplicated count of EPSDT eligibles by age and basis of eligibility who receive (1) any dental services, (2) preventive dental services, and (3) dental treatment services. Classification into one of these measures is based on specific dental procedure codes recorded on provider claims. Across states in FY2006, use of dental services among Medicaid children was generally low, as shown in Table 1 . Receipt of any dental services among Medicaid children eligible for EPSDT ranged from 18.9% (in North Dakota) to 55.7% (in West Virginia). Receipt of preventive dental services ranged from 6.7% (in Utah) to 51.0% (in Vermont). Finally, receipt of dental treatment services ranged from 6.4% (in Nevada) to 40.8% (in West Virginia). During routine immunization and well-child visits, there are a number of opportunities for physicians to inform parents about the need for dental services for their children. Guidance from the American Academy of Pediatrics for well-child visits during 2006 (in effect since 2000) called for initial dental referrals at age three years, or as early as one year of age when indicated. Table 2 provides a more detailed analysis of the receipt of preventive dental services by age in FY2006. Across age groups within each state and for all reporting states as a whole, utilization patterns resembled a bell-shaped curve (see Figure 1 ). That is, children at the age extremes tended to receive fewer preventive dental services than children in the middle of the age range. Among nearly all states, the highest rates of preventive dental care were observed for the six- to nine-year-old age group. For this age group, 10 states had preventive dental rates over 50%, and one state (Vermont) met the Healthy People 2010 goal that at least 66% of such children receive a preventive dental visit. The higher rates of preventive dental care among children aged six to nine may be related in part to school entry requirements for childhood immunizations. In order to attend kindergarten at ages five and six, for example, all states require that children have received common childhood immunizations (e.g., vaccinations for diphtheria, tetanus, and acellular pertussis, or DTaP; measles, mumps, and rubella, or MMR; and polio). When children receive those immunizations, health care providers may make referrals for other health services, including dental care. Many states recognize that dental care is underutilized across most Medicaid sub-populations. In a September 2008 hearing before the Domestic Policy Subcommittee of the House Committee on Oversight and Government Reform, state officials and other representatives from Maryland, Virginia, North Carolina, and Georgia, and from the dental profession, described recent state actions to improve dental care for Medicaid children. Their recommendations included the following: increase dental reimbursement rates to make them more in line with private market-based rates; remove administrative barriers (e.g., prior authorization for certain procedures, simplified claims, and use of electronic billing); carve out dental benefits from managed care contracts and use a single dental vendor to establish a more stream-lined approach to processing claims and paying providers; when designing new dental program features, involve dentists and professional dental organizations; establish dedicated dental units in state governments to help guide policy decisions; and establish "dental extenders" to increase service capacity, including for example, (1) primary care medical professionals to provide oral evaluation and risk assessment, counseling for parents about oral hygiene, and application of fluorides, and (2) other allied dental providers that can do community outreach and education, and perform preventive services such as fluoride and sealant application, potentially expanding to additional dental treatment services. Other states may draw lessons from these experiences and recommendations. With respect to the final point above, provider groups hold varying opinions about the extent to which non-dentists can and should provide certain dental services. States may need to address such issues if they wish to expand access to dental care under Medicaid for children and other sub-groups.

According to guidelines published by the American Academy of Pediatric Dentistry, all youth should see a dentist for routine dental screening and preventive care twice a year. Dental care is a mandatory benefit for most Medicaid eligibles under the age of 21, however, nationwide, the majority of low-income children enrolled in Medicaid do not receive any dental services in a given year. There are many beneficiary and provider-related issues that contribute to inadequate access to and delivery of dental care. To address this problem, some states have undertaken new Medicaid initiatives to attract and retain dental providers that may serve as models for other state Medicaid programs.

In general, there is no single, accepted, and specific definition of the term earmark for thecongressional appropriations process, nor is there a standard practice for earmarks. (1) However, for fundingprovided by Energy and Water Development (E&W) Appropriations laws to the Department ofEnergy (DOE), this report defines an earmark as "funds set aside within an account for individualprojects, locations, or institutions." In the FY2006 E&W appropriation law, earmarks were labeledas "congressionally directed projects" (2) and most often appeared in the joint explanatory statement of theconference report. (3) Accordingly, DOE budget request documents usually refer to earmarks as "congressionally directedactivities" and often report on them in separate account lines under the functional energy area towhich the earmarks are applied. (4) There is a general debate in Congress over earmarks, in which a key concern is thetransparency of earmark activities in the deliberative process. Critics of the current earmarkingprocess argue that it is not the subject of open debate and that the number of earmarks has grownrapidly. A "dear colleague letter" that seeks to change the process says, We believe the process of earmarking undermines theconfidence of the American public in Congress because the practice is not open, fair, or competitiveand tends to reward the politically well-connected. (5) Opponents further contend, as noted in the letter above, that it is wrong to take an earmark provisionthat survives neither the House or the Senate version of a bill and, nevertheless, have it inserted intoa conference report. This, they say, "stifles debate" and unfairly empowers well-financed lobbyists. Supporters of earmarking generally agree on the need for more transparency, but theycounter-argue that earmarks are not inherently wrong, nor should they be forbidden by rules ofcongressional process. At a February 2006 hearing on the subject, one proponent said, [The Constitution] placed the responsibility for makingspending decisions, not in the Executive Branch, but in the Congress.... Congress has always had thefinal say on that issue. Some would say that the earmarking process has been abused in recent yearsand I would agree, especially in cases where earmarks are inserted into Conference Reports that havenot been scrutinized by either body. (6) In general, proponents agree that some modification of the process may be needed, but otherwisecontend that earmarking is legitimate under the Constitution and is justified because elected officialsare better able to make decisions about funding for local needs than program managers in theexecutive branch. (7) In a review of the FY2006 DOE budget, the American Academy for the Advancement ofScience (AAAS) examined earmarks for DOE energy research and development (R&D) programsand found that ... earmarks eat up whatever increases there are for mostenergy programs and cut deeply into core R&D programs. Energy R&D earmarks total $266 millionin 2006, more than double the previous record from last year, and make up one out of every fiveR&D dollars. But they are especially concentrated in some areas, including biomass R&D wherethey make up more than 50% of total program funds, hydrogen (27%), and wind energy (33%), ratiosfar higher than in previous years. As a result, there will be enormous cuts to competitively awardedR&D grants in those areas. (8) Table 1 , below, shows the funding trends for earmarks under programs in DOE's Office ofEnergy Efficiency and Renewable Energy (EERE) and DOE's Office of Electricity Delivery andEnergy Reliability (OE). These trends are illustrated in Figure 1 , at the end of this report. The tableshows that EERE funding earmarks have more than tripled, from $46.0 million in FY2003 to $159.0million in FY2006. Table 1: Earmark Funding Trends for EERE andOE ($ millions) Sources: DOE Budget Requests FY2005, FY2006, and FY2007 and H. Rept. 109-275 . For FY2006, Table 3 (below) shows a $30.7 million increase in renewable energy R&Dearmarks, including increases of $16.4 million for Biomass & Biorefinery, $8.3 million for WindEnergy, and $4.1 million for Solar Energy. Of the $42.5 million increase for energy efficiency R&Dearmarks, nearly half ($20.3 million) was for Vehicle Technologies. Also, Table 3 shows a $28.8million increase for Electricity R&D earmarks under the Office of Electricity (OE). In early February 2006, the National Renewable Energy Laboratory (NREL) issued a pressrelease stating that FY2006 earmarks for EERE programs had left it with a $28 million gap in itsoperating funds, forcing NREL to cut 32 staff positions in hydrogen, biomass, and basic researchprograms. (9) The FY2007DOE Budget Request shows that the EERE share of NREL's budget was reduced from $182.5million in FY2005 to $161.6 million in FY2006, a $21 million (or 13%) reduction. (10) However, in late February 2006, DOE announced that an additional $5 million had been sentto NREL to immediately restore all 32 positions. DOE transferred the funding from other accountsand announced that it was working with Congress to restore funds to those accounts through severalmeans, including the "deobligation of funds provided to several congressionally directed projects in2001 and 2002 that have failed to make progress." DOE further noted, "Should Congress fully fundthe President's FY2007 request, unencumbered by earmarks, NREL should be able to maintain avibrant and stable workforce in the future." (11) In the State of the Union Speech given in January 2006, President Bush announced the launchof the American Competitiveness Initiative (ACI), which would increase support for R&D andtechnological innovation, including certain energy initiatives, (12) to help stimulate economicgrowth. The Administration's ACI document expresses concern about the potential for earmarks toimpede the proposed initiatives. Consistent with the previously noted definition, it defines earmarksas "the assignment of science funding through the legislative process for use by a specificorganization or project." It says, ... the practice signals to potential researchers that thereare acceptable alternatives to creating quality research proposals for merit-based consideration,including the use of political influence or appeals to parochial interests. The rapidly growing levelof legislatively directed funds undermines America's research productivity. (13) ACI contends that this type of funding is "rarely the most effective use of taxpayer funds." On the other hand, some proponents argue that R&D earmarks help spread the researchmoney to states and institutions that would receive less research funding through other means. Also,some supporters of earmarking contend that earmarks provide a means for funding unique projectsthat would not be recognized by the conventional peer-review system. (14) A key component of ACI, the Advanced Energy Initiative (AEI), proposes new initiatives forseveral energy technologies. (15) In particular, it embraces key initiatives (16) for hydrogen,biomass/biorefinery, and solar energy (17) that are reflected in the FY2007 DOE budget request as majorfunding increases for corresponding host programs under the Office of Energy Efficiency andRenewable Energy (EERE). (18) Table 2 shows the FY2006 funding earmarks for the Hydrogen, Biomass/Biorefinery, andSolar Energy programs at EERE. It also shows the proposed FY2007 funding increases for AEI'shydrogen, biomass/biorefinery, and solar energy initiatives under those programs. The table showsthat the FY2006 earmarks are nearly equal to the proposed increases for the hydrogen andbiomass/biorefinery initiatives; for the solar energy program, however, the total earmark is muchsmaller than the proposed AEI increase. Table 2. Earmark Funding Compared with AEIProposals ($ millions) Sources: DOE Budget Requests FY2005, FY2006, and FY2007 and H.Rept. 109-275 . Do the EERE earmarks seriously weaken R&D programs, as some opponentscontend, or do they merely provide a more equitable, although perhaps more decentralized,distribution of R&D funding, as some proponents argue? If renewable energy earmarks under EERE continue at the same or higherlevels in FY2007, would they lead to new cuts in staff positions at NREL? If Congress were to approve the Administration's requested increases for theAEI renewable energy initiatives, would earmarks continued at the same or higher levels act to diluteor otherwise erase some of the technological stimulation that the AEI aims to generate for itshydrogen, biomass/biorefinery, and solar energy goals? Table 3. DOE EERE and OE Earmarks,FY2005-FY2006 ($ millions, current) Sources: DOE, FY2007 Budget Request , vol. 3; H.Rept. 109-275 , pp. 143-145; and personalcommunication with Mr. Randy Steer, DOE/EERE, Feb. 23, 2006. Figure 1. DOE Earmark Funding for Renewable, Energy Efficiency, and Electricity

Appropriations earmarks for the Department of Energy's (DOE's) Energy Efficiency andRenewable Energy (EERE) programs have tripled from FY2003 to FY2006. According to theExecutive Office of the President and the private American Association for the Advancement ofScience (AAAS), this affects the conduct of programs and may delay the achievement of goals. Further, the Administration has proposed new funding for hydrogen, biomass/biorefinery, and solarenergy initiatives proposed under the American Competitiveness Initiative/Advanced EnergyInitiative (AEI). The report discusses the potential impact of congressional earmarks on EERE research anddevelopment (R&D) programs and, in particular, whether continued high levels of earmarks couldlead to new cuts in staff and dilute the desired impact of the AEI initiatives under EERE, shouldCongress decide to fund them. The congressional debate over earmarks centers on the transparency of the process, with afocus on earmarks not initially approved in either chamber that appear in a bill's conference report. Opponents contend that the earmarking process is not open, fair, or competitive. Proponents say itis a legitimate practice and is justified by policymakers' knowledge of local needs, as it spreadsresearch money to deserving states and institutions. The appropriation figures cited as "earmarks" in this report are those labeled by DOE budgetrequests as "congressionally directed activities" and, for FY2006, appear to be completely consistentwith figures in the FY2006 Energy and Water Development (E&W) conference report that arelabeled as "congressionally directed projects." In this regard, the earmark figures in this reportappear consistent with the definition of a congressional appropriations earmark as "funds set asidewithin an account for individual projects, locations, or institutions." This report will be updated as events warrant.

The U.S. effort to develop and deploy ballistic missile defenses (BMD) based on the concept of hit-to-kill or kinetic energy kill began three decades ago. This effort gained momentum as the primary focus of the U.S. BMD program in the mid-1980s with the announcement of President Reagan's Strategic Defense Initiative (SDI). Since that time, the United States has pursued numerous major kinetic energy BMD programs; these have produced hundreds of various flight test results. These test results and some very limited operational experience in wartime provide sufficient data for at least some conclusions regarding the decades-long U.S. investment in hit-to-kill as a concept for BMD. This overview report examines the U.S. investment in that concept, what that investment has produced, and raises various questions that might be considered. The development of BMD has shown important technological differences between efforts designed to attack and destroy short or medium-range ballistic missiles and those designed for long-range or intercontinental ballistic missiles. Therefore, this report will review and distinguish between the program results of theater missile defense (TMD) and national missile defense (NMD). CRS received historical flight test data from the Missile Defense Agency (MDA) in June 2005. It is important to note that for each of these flight tests there were various primary and multiple secondary objectives. Such flight tests are inherently complex and relatively costly. Therefore, multiple test objectives are designed to maximize the potential benefit derived from each flight test. The determination as to whether each of these objectives was reached was made by each relevant agency or military branch. All of the references to flight test results in this report are derived from the Flight Tests Results memorandum provided by the MDA unless otherwise referenced. CRS currently is awaiting an update of the historical flight test data from MDA, which will be reviewed and included in an updated version of this report later in 2007. Analysis of flight test data shows that the U.S. effort to develop, test, and deploy effective BMD systems based on this concept has produced mixed and ambiguous results. The actual performance in war-time of one kinetic-energy system currently deployed by the United States (i.e., the Patriot PAC-3) is similarly ambiguous. Further, it is not yet possible to assess the operational effectiveness the other deployed system (i.e., the National Defense System) against long-range ballistic missile threats. The United States has pursued four major kinetic energy interceptor long-range BMD or NMD programs since the early 1980s: Homing Overlay Experiment (HOE), Exoatmospheric Reentry Interceptor Subsystem (ERIS), National Missile Defense (NMD), and Ground-based Midcourse Defense (GMD). Each of these is briefly discussed below. The Army developed HOE in the late 1970s and early 1980s to test the viability of the emerging hit-to-kill concept. It conducted four intercept flight tests in 1983 and 1984. Three of the tests failed to intercept the intended target, but the fourth was considered a success. The Army did not identify any secondary flight test objectives. Nonetheless, the nascent SDI program then viewed the single reported success as evidence of the promise of non-nuclear BMD interceptor technologies. The technologies tested in HOE served as the basis for its successor program, ERIS. ERIS went through a lengthy development program before flight testing began in 1991 with the first of four intercept flight tests. Although the first was considered a successful intercept of the target, the following three intercept attempts through 1992 failed to destroy their intended targets. Even so, officials concluded that half of the primary and secondary test flight objectives were accomplished, and that the primary BMD concept being pursued held significant promise. The NMD program followed ERIS with a series of eight flight tests from 1997 to 2001. The first three were planned "fly-by" tests. There were no intercept attempt objectives. The first one failed to launch; however, the other two were deemed successful in their primary objectives. No secondary objectives were identified. Of the five planned intercept attempts, three reportedly intercepted their intended targets; one ended in failure because the interceptor kill vehicle did not deploy and the other failed because the on-board sensors designed to track and intercept the target failed. Officials concluded that 17 of the 20 primary objectives were met or partially met and all the secondary objectives by the planned intercept tests were met. The current GMD program (NMD's successor) began flight testing in 2002. Since that time six flight tests have taken place. Five of these flight tests were planned intercept attempts, with three resulting in failure to intercept. Officials concluded that about 80% of the program's 40 or so primary intercept flight test objectives were met; all the secondary objectives were met fully or partially. In 2004, the GMD undertook a new configuration with a different booster and interceptor. It flew a successful integration flight test (non-intercept test) in early 2004 with all primary and secondary objectives met. This system was deployed in Alaska and California in 2004 and declared operational after eight missiles were placed in silos. Subsequently, two planned intercept flight tests in December 2004 and February 2005 failed to launch. The currently deployed system thus remains to be tested successfully against targets it might be expected to intercept. In September 2006, a successful flight test exercise of the GMD system too place. Although not a primary objective of the data collection test, an intercept of the target warhead was achieved. Flight tests whose primary objectives are intercepts were scheduled for later in 2006, but have been delayed into 2007. Each of the four NMD programs were different, but they built on the limited successes of their predecessors. Of the eighteen or so attempted intercepts since the early 1980s, seven of them were considered successful, or roughly a 39% intercept rate in tests. Officials cited several reasons, including program hardware and software, as well as interceptor silo and target launch failures. From that, there do not appear to be any recognizable patterns that emerge to account for the mostly unsuccessful history of the effort. Nor is there conclusive evidence of a learning curve, such as increased success over time relative to the first tests of the concept 20 years ago. Program supporters can point to limited evidence that, under controlled conditions, there is reason to support the contention that kinetic energy interceptor technology for use against long-range ballistic missiles holds promise. Critics of the flight test effort to date, whether they support missile defense or not in general, can raise questions about the success rate and the realism of the testing effort, given a generation of U.S. investment in its development. Can kinetic energy interceptor technologies for use against long-range ballistic missiles be developed successfully and deployed as an effective part of the U.S. military posture? The answer appears to be ambiguous at this juncture. Can the now-deployed NMD system protect the United States from long-range ballistic missile attacks? Currently, there is insufficient empirical data to support a clear answer. There have been a number of major kinetic-energy TMD programs since the early 1990s: Extended Range Intercept Technology (ERINT), Flexible Lightweight Agile Guided Experiment/Small Radar Homing Intercept Technology (FLAGE/SRHIT), Navy Lightweight Exoatmospheric Projectile (LEAP), the Navy Aegis BMD, Patriot PAC-3, and Theater High Altitude Area Defense (THAAD). Each of these are briefly examined below. The Army's FLAGE/SRHIT program conducted eight flight tests from 1984-1987 to prove the feasibility of lower atmosphere intercepts. Five of these flight tests were planned intercept attempts. From the data provided by MDA all the primary and secondary test objectives in the series were achieved. The targets included stationary targets in the atmosphere and an air-launched target. Only one target, however, was a short-range missile. The degree to which any conclusions might be drawn regarding very short-range hit-to-kill in this effort is therefore limited. Building on the SRHIT effort, the Army's ERINT flight test program (1992-1994) conducted five flight tests. Three of these were planned intercepts; two of these three flight tests successfully intercepted their targets (the failure cited was hardware related). Despite the missed intercept, the Army concluded that all of its primary test objectives for the three tests were met fully or partially, and that all but one of the 26 secondary objectives in the three tests were met. As far as the two non-intercept flight tests were concerned, the Army determined that all of its primary and secondary flight test objectives were met. The Navy developed its own indigenous LEAP program, which flight tested from 1992-1995. Three non-intercept flight tests achieved all primary and secondary objectives. Of the five planned intercept tests, only the second was considered a successful intercept, however. Failures were due to various hardware, software, and launch problems. Even so, the Navy determined that it achieved about 82% of its primary objectives (18 of 22) and all of its secondary objectives in these tests. Building on some of its previous efforts in SRHIT and ERINT, the Army's THAAD program nevertheless experienced significant challenges from 1995 to 1999. After three relatively successful non-intercept flight tests (almost all of the primary and secondary test objectives were partially or fully met), THAAD failed to intercept in seven of its nine planned attempts. However, the THAAD intercept flight test program met about half of its primary and secondary objectives. Because the last two intercepts were successful (the last being in 1999), the Department of Defense and Congress agreed to further develop, but revamp, the THAAD program. The current THAAD program is a redesign of the former THAAD system. Recently, the program conducted its first flight test (non-intercept) to examine the launch, boost, and fly-out functions of the THAAD missile. MDA officials considered this test successful. The Army's Patriot (Phased Array Tracking to Intercept of Target) program has a history dating to the 1960s as an air-defense weapon. Only in the mid-to-late 1980s at the insistence of Congress was the program given a specific anti-missile role. Using a focused explosive charge (non-nuclear and not hit-to-kill technology), Patriot PAC-2's (Patriot Antitactical Capability) 1991 Desert Storm performance remains controversial. After the war, Patriot improvements for missile defense were widely supported. Testing of the Patriot PAC-3 with a kinetic energy interceptor began in 1997. After the initial two successful non-intercept flight tests (most of the objectives were met), the Patriot PAC-3 attempted 27 intercept tests, of which 21 (about 78%) were considered successful intercepts. Additionally, some 92% of the primary intercept test objectives were met, as well as almost all of the known secondary objectives. In terms of actual wartime use, the Patriot PAC-3 was used in Operation Iraqi Freedom (OIF) in 2003, but its role was very limited (four missiles fired in two successful engagements) and thus, while suggestive of significant promise, its operational effectiveness remains uncertain based on limited empirical data. Building on its previous efforts as well, the Navy (as of mid-2005) had conducted six (of seven) successful intercept tests of its Aegis BMD (or Navy sea-based) program using the Standard Missile-3 (SM-3) Block 1 missile (2002-2005). The most recent test included in the data sheets provided to CRS was against a warhead target that separated from the booster rocket itself, in contrast to earlier intercept tests against SCUD-type ballistic missiles. The most recent flight test intercept attempt (in December 2006) was not completed due to technical problems aboard the Aegis cruiser involved prior to the launch of the two interceptor missiles themselves. Primarily because of the Patriot PAC-3 flight test and operational record and the more recent Navy BMD program, the concept of hit-to-kill for TMD appears promising. Older TMD efforts were not as suggestive, and the foundation for the current THAAD program is based mostly on prior test failures. Nonetheless, because there is no flight test data yet on the current THAAD program, nothing conclusive can be said about its potential future for success. And, although the Patriot PAC-3 shows promise, some might note that the Patriot system itself has been evolving for about 40 years now. Additionally, much of the Navy infrastructure and technology supporting the Aegis SM-3 is decades old and is comparable in evolution to the Patriot air and missile defense system. A central question might be: at this stage how well is the United States doing in developing effective ballistic missile defenses based on this kinetic energy kill concept? Since the announcement of the SDI program in the mid-1980s the United States has spent about $100 billion on missile defense with a primary focus on the kinetic energy or hit-to-kill concept. U.S. programs began looking at that concept a decade earlier into the mid-1970s. Supporters of hit-to-kill could argue that what the United States is striving to do has indeed proven to be challenging, but that progress is being made. Furthermore, success measured in terms of operationally effective deployed BMD systems based on this concept, loom on the horizon. They could also argue that threats posed from the proliferation of ballistic missiles and weapons of mass destruction (WMD) must be addressed by developing effective BMD systems. Supporters and skeptics could argue the need for an independent, comprehensive evaluation of the test record to determine whether any systemic or conceptual challenges are impeding the U.S. effort. Although some defense officials have provided testimony and private and government agencies have looked in detail at a few of these tests, some might argue that a comprehensive and independent review of the entire record to date has not been undertaken and is warranted. Other observers might argue that alternatives should be pursued as a hedge against the possible failure of this concept for either NMD or TMD. Such alternatives could be military in nature, such as reducing the emphasis on BMD in favor of increased emphasis on counter-force (i.e., attacking and destroying enemy missile systems before their missile could be launched). Alternatives also could focus on other ways to mitigate ballistic missile proliferation (e.g., arms control). Some alternatives, such as a return to nuclear BMD concepts or emphasis toward more exotic technologies (e.g., lasers or weapons in space) might face opposition on political or technical grounds. Still other observers could argue that in general the United States needs to make a more concerted effort to increase developmental testing across the board, before these systems are ready for more realistic testing regimes. They could argue that almost all the testing to date is of a developmental nature and that an operational testing regimen has not been developed, but remains essential. Only then, they could argue, could assessments to confirm the validity of the hit-to-kill concept for BMD be made with confidence.

For some time, U.S. ballistic missile defense (BMD) programs have focused primarily on developing kinetic energy interceptors to destroy attacking ballistic missiles. These efforts have evolved over 30 years and have produced a significant amount of test data from which much can be learned. This report provides a broad overview of the U.S. investment in this approach to BMD. The data on the U.S. flight test effort to develop a national missile defense (NMD) system remains mixed and ambiguous. There is no recognizable pattern to explain this record nor is there conclusive evidence of a learning curve over more than two decades of developmental testing. In addition, the test scenarios are considered by some not to be operational tests and could be more realistic in nature; they see these tests as more of a laboratory or developmental effort. Success and failure rates (and their technical causes) have shown relative consistency through this period. The U.S. flight test effort to develop theater missile defense (TMD) systems appears more promising. In relative terms, developmental and operational testing of TMD systems has been more successful than the NMD effort. Nonetheless, TMD systems that evolved from mature, existing ground and sea-based air-defense systems have demonstrated greater test success than other TMD programs. How effective has the U.S. investment been in developing kinetic energy BMD systems? Observers could make any number of arguments as to what the record means and what could be done to improve the effectiveness of systems under development and of those deployed. Some observers have suggested that the 110th Congress might review the U.S. investment in the kinetic energy concept to date to determine how best to proceed with the U.S. BMD effort in the coming years. This report will be updated as events warrant.

H.Res. 6 renamed five committees. The name of the Committee on Education and the Workforce was changed to the Committee on Education and Labor. The name of the Committee on International Relations was changed to the Committee on Foreign Affairs. The name of the Committee on Resources was changed to the Committee on Natural Resources. The name of the Committee on Government Reform was changed to the Committee on Oversight and Government Reform. The name of the Committee on Science was changed to the Committee on Science and Technology. The Rule X, clause 11 jurisdiction of the Permanent Select Committee on Intelligence was updated to reflect the overhaul of the intelligence community, including the creation of the director of national intelligence. Pursuant to a statement inserted in the Congressional Record by Rules Committee Chairwoman Louise Slaughter during the debate on H.Res. 6 , the jurisdiction of the Committee on Small Business was reaffirmed to include the Small Business Administration and its programs, as well as small business matters related to the Regulatory Flexibility Act and the Paperwork Reduction Act. Other programs and initiatives that address small businesses outside the confines of those acts were referenced as well. Also inserted in the Congressional Record during debate on H.Res. 6 was a memorandum of understanding between the Committee on Homeland Security and the Committee on Transportation and Infrastructure detailing the jurisdictional agreement related to the Federal Emergency Management Agency and to port security. House Rule X, clause 5(d), which generally limits committees to five subcommittees was waived for three committees. The Armed Services Committee was permitted to have seven subcommittees; the Foreign Affairs Committee was permitted to have seven subcommittees; and the Transportation and Infrastructure Committee was permitted to have six subcommittees. The Committee on Oversight and Government Reform was authorized to adopt a committee rule that authorized and regulated the taking of depositions by a Member or counsel of the committee, including depositions in response to a subpoena. The rules resolution permitted the new committee rule to require those being deposed to subscribe to an oath. It also required the committee rule to provide the minority with equitable treatment, by providing notice of such a proceeding and a reasonable opportunity to participate. The Rules Committee was allowed to publish the record votes taken during committee consideration in committee reports and through other means such as the Internet. The Rules Committee report was shielded from a point of order if the report was filed without a complete list of record votes taken during consideration of a special rule. Committees of jurisdiction were required to publish lists of earmarks, limited tax benefits, and limited tariff benefits contained in any reported bill, unreported bill, manager's amendment, or conference report that comes to the House floor.

This report details changes in the committee system contained in H.Res. 6 , the Rules of the House for the 110 th Congress, agreed to by the House January 4, 2007. The report will not be updated unless further rules changes for the 110 th Congress are adopted.

Prior to the September 11, 2001 terrorist attacks, insurance covering terrorism losses wasnormally included in general insurance policies without a specific premium being paid. Essentiallymost policyholders received this coverage for free. The attacks, and the more than $30 billion ininsured losses that resulted from them, caused a rethinking of the possibilities of future terroristattacks. In response to the new appreciation of the threat and the perceived inability to calculate theprobability and loss data critical for pricing insurance, both primary insurers and reinsurers pulledback from offering terrorism coverage. Many argued that terrorism risk is essentially uninsurableby the private market due to the uncertainty and potentially massive losses involved. Becauseinsurance is required for a variety of economic transactions, many feared that a lack of insuranceagainst terrorism loss would have wider economic impact, particularly on large-scale developmentsin urban areas that would be tempting targets for terrorism. Congress responded to the disruption in the insurance market by passing the Terrorism RiskInsurance Act of 2002 (1) (TRIA), which was signed by the President in November 2002. TRIA created the Terrorism RiskInsurance Program, which was enacted as a temporary program, expiring at the end of 2005, to calmthe insurance markets through a government backstop for terrorism losses and give the privateindustry time to gather the data and create the structures and capacity necessary for private insuranceto cover terrorism risk. Terrorism insurance has become widely available under TRIA and the insurance industry hasgreatly expanded its financial capacity in the past three years. It appears, however, that less progresshas been made on creating terrorism models that are sufficiently robust for insurers to return tooffering widespread terrorism coverage without a government backstop, and that practically noprogress has been made on a private pooling mechanism to cover terrorism risk. Some see the pastthree years as proof of the argument that the private market will never be able to offer insurance tocover terrorism risk and continue to see the possibility of wider economic consequences if terrorisminsurance again is unavailable. Others, notably the U.S. Treasury Department, respond that TRIAitself is retarding the growth of this private market and should be allowed to expire, or at least bereduced from its current form. Congress responded to the impending expiration of TRIA with two different bills thatinitially passed the respective houses. The Senate bill, Senator Christopher Dodd's S. 467 , was approved by the Senate on November, 18, 2005. The large majority of the language fromthe House bill, Representative Richard Baker's H.R. 4314 , was inserted into S.467 and passed by the House on December 7, 2005. S. 467 was entitled theTerrorism Risk Insurance Extension Act, whereas H.R. 4314 was entitled the TerrorismRisk Insurance Revision Act and the titles did reflect essential differences between the two bills. Senator Dodd introduced S. 467 on February 18, 2005. As introduced, it wasidentical to a bill, S. 2764 , introduced by Senator Dodd in the 108th Congress. S.467, as introduced, would have explicitly extended TRIA for two years, until the end of2007, and would have added a "soft landing" year by changing the definition of an insured loss sothat policies written in the second year and extending into a third year would be covered. Theindividual insurer deductible was to remain at 15% of earned premiums during the extension, whilethe insurance industry aggregate loss retention amount was to increase from the current $15 billionin 2005 to $17.5 billion for 2006 and finally $20 billion for 2007. S. 467 also would havedirected the Treasury to promulgate new rules including group life insurance under TRIA. On June 30, 2005, the Department of the Treasury released a report on TRIA accompaniedby a letter from Secretary Snow indicating that TRIA had achieved its goal of stabilizing theinsurance market and that the Administration would not support an extension without significantchanges reducing the taxpayer exposure from the program. On November 16, 2005, the SenateCommittee on Banking, Housing, and Urban Affairs marked up S. 467 and substitutedan amendment by Chairman Richard Shelby for the original text. It then reported the bill favorablyto the full Senate by voice vote. As amended, S. 467 would have extended the current program two years andfurther increased the private sector's exposure to terrorism risk over the life of the act, as did theoriginal legislation. During the three years covered by the initial act, insurance industry deductiblesand aggregate retention rose each year. S. 467 continued to increase these. It would havealso reduced the types of insurance covered by the program and increased the size of a terrorist eventnecessary to trigger the program. Specifically, it removed commercial auto, burglary and theft,surety, farm owners multiple peril, and professional liability (except for directors and officersliability), as covered lines; raised the insurer deductible to 17.5% in 2006 and 20% in 2007;decreased the federal share of insured losses from 10% to 15% for 2007; and raised the event triggerto $50 million in 2006 and $100 million in 2007. S. 467 was brought to the Senate floor and passed by unanimous consent onNovember 18, 2005. The House brought the bill to floor and amended it with most of the text of H.R. 4314 before passing it on December 7, 2005. H.R. 4314 was introduced by Representative Baker on November 14, 2005, andmarked up by the House Financial Services Committee on November 16. Three amendments, byChairman Michael Oxley and Representatives Barney Frank and Debbie Wasserman Schultz, wereadopted in committee by voice vote. (2) Chairman Oxley's amendment made a number of changes,including adjusting the exact deductibles for various insurance lines, reducing the program triggeramount in program years after the second year and striking language that would have preemptedsome state laws relating to rate and form filing. Representative Frank's amendment increased thesize needed by a company or municipality to be considered an "exempt commercial purchaser" ofinsurance. Representative Wasserman Schultz's amendment added the requirement that life insurersnot deny insurance coverage based on lawful overseas travel. The amended bill was favorablyreported to the full House by a vote of 64-3. In the 108th Congress, the committee had reportedfavorably a straightforward extension of TRIA with relatively minor changes. H.R. 4313 , however, went well beyond the previously reported House bill or the changes recommendedby Secretary Snow. H.R. 4314 as reported would have limited the types of insurance covered byremoving commercial auto insurance. However, it would have expanded the program to coverdomestic terrorist events and increased the covered types of insurance to include group life andspecific coverage for nuclear, biological, chemical, and radiological (NBCR) events. It would haveraised the event trigger to $50 million in 2006 and added an additional $50 million to this for everyfuture year the program is in effect. It also would have changed the insurer deductible but wouldhave done so differently for different lines of insurance, raising it to as high as 25% for casualtyinsurance but lowering it to 7.5% for NCBR events. H.R. 4314 would have lowered thefederal share of insured losses to 80% for events under $10 billion but raised it gradually to 95% forevents over $40 billion. In the case of a terrorist act, the deductibles and event triggers would havereset to lower levels, with deductibles possibly as low as 5% in the event of a large attack. It wouldhave removed the cap on the mandatory recoupment provision so that all money expended underTRIA would be recouped by the federal government through a surcharge on insurers in the yearsafter the attack. H.R. 4314 also would have created "TRIA Capital Reserve Funds (CRF),"to allow insurers to set aside untaxed reserves to tap in the case of a terrorist event. With a few changes, notably the addition of language striking Section 107 of the originalTRIA, the language of H.R. 4314 as it was reported was inserted into the Senate-passed S. 467 , and this amended version of S. 467 passed the House 371-49 onDecember 7, 2005. Shortly after passage, the House called for a conference committee to resolvedifferences with the Senate and appointed conferees. The Executive Office of the President issued a Statement of Administration Policy supporting S. 467 on November 17, 2005. It also indicated that the Administration would stronglyoppose "any efforts to add lines of coverage, including group life insurance." On December 7, 2005,a Statement of Administration Policy was issued that specifically opposed the House-passed versionof S. 467. Following the House appointment of conferees on December 7, 2005, the Senate did notappoint conferees. Instead, it took up and passed a further amendment ( S.Amdt. 2689 )to S. 467 by unanimous consent on December 16, 2005. The House followed this withpassage of this version of S. 467 by voice vote on December 17, 2005. S. 467 was signed by the President on December 22, 2005, becoming PublicLaw 109-144. P.L. 109-144 closely follows S. 467 as initially passed by the Senate onNovember 18, 2005. The significant difference is an increase in the aggregate retention amount from$17.5 billion and $20 billion to $25 billion and $27.5 billion for 2006 and 2007. Table 1. Side-by Side: Terrorism Risk Insurance Act of 2002, Initial Senate- and House-passed Legislation,andTerrorism Risk Insurance Extension Act of 2005 Notes: The initial House-passed S. 467 would strike essentially all of 15 U.S.C. 6701 note (which sets out sections 101-108 of P.L. 107-297 )and replaces it with a similar structure, including in some cases, identical language. The section numbers for this House-passed S. 467 citedin this side-by-side are, therefore, those that would appear in the Code if the bill were enacted, except for the provision entitled "Litigation Management." In contrast, both the initial S. 467 and P.L. 109-144 simply amend 15 U.S.C. 6701 note. The section numbers cited in this side-by-side are thusthose of the bill and law.

Prior to the September 11, 2001, terrorist attacks, insurance covering terrorism losses wasnormally included in general insurance policies without cost to policyholders. Following the attacks,both primary insurers and reinsurers pulled back from offering terrorism coverage, citing particularlyan inability to calculate the probability and loss data critical for insurance pricing. Some argued thatterrorism risk would never be insurable by the private market due to the uncertainty and potentiallymassive losses involved. Because insurance is required for a variety of economic transactions, it wasfeared that a lack of insurance against terrorism loss would have wider economic impact. Congress responded to the disruption in the insurance market by passing the Terrorism RiskInsurance Act of 2002 (TRIA). TRIA created a temporary program, expiring at the end of 2005, tocalm the insurance markets through a government backstop for terrorism losses and to give theprivate industry time to gather the data and create the structures and capacity necessary for privateinsurance to cover terrorism risk. From 2002 to 2005, terrorism insurance became widely availableand largely affordable, and the insurance industry greatly expanded its financial capacity. There was,however, little apparent success on a longer term private solution and fears persisted about widereconomic consequences if insurance were not available. To a large degree, the same concerns andarguments that accompanied the initial passage of TRIA were before Congress as it considered TRIAextension legislation. Congress responded to the impending expiration of TRIA with the passage of two differentbills. The Senate bill, S. 467 , was approved by the Senate on November 18, 2005. Thelarge majority of the language from the House bill, H.R. 4314 , was inserted into S.467 and passed by the House on December 7, 2005. S. 467 was titled theTerrorism Risk Insurance Extension Act, whereas H.R. 4314 was titled the Terrorism RiskInsurance Revision Act. These titles did reflect essential differences between the two bills. S.467 extended the current program by two years and further increased the private sector'sexposure to terrorism risk, as did the original act. (During the three years covered by the initial act,insurance industry deductibles and aggregate retention rose each year.) S. 467 continuedto increase these and also reduced the types of insurance covered by the program and increased thesize of terrorist event necessary to trigger the program. H.R. 4314 extended the programfor two or possibly three years and substantially revised many aspects of it. Among the notablechanges, it excluded some lines of coverage and included others that were not covered before. Itsegmented lines of insurance, introducing different deductibles for different lines. It included theconcept of resetting the deductibles and the trigger amount to lower amounts if a terrorist attackoccurs in the future. The final version signed into law closely tracked the Senate legislation. This report briefly outlines the issues involved with terrorism insurance and includes aside-by-side of the initial TRIA, TRIA-extension legislation as considered in the House and Senate,and the final bill as signed by the President. It will not be updated.

The ADA Amendment Act (ADAAA), P.L. 110-325 , was enacted in 2008 to amend the Americans with Disabilities Act (ADA). The Americans with Disabilities Act (ADA) is a broad civil rights act prohibiting discrimination against individuals with disabilities. As stated in the act, its purpose is "to provide a clear and comprehensive national mandate for the elimination of discrimination against individuals with disabilities." The ADAAA reiterated this purpose, and also emphasized that it was "reinstating a broad scope of protection" for individuals with disabilities. The threshold issue in any ADA case is whether the individual alleging discrimination is an individual with a disability. Several Supreme Court decisions interpreted the definition of disability, generally limiting its application. Congress responded to these decisions by enacting the ADA Amendments Act, P.L. 110-325 , which rejects the Supreme Court and lower court interpretations and amends the ADA to provide broader coverage. Two of the major changes made by the ADA Amendments Act are to expand the current interpretation of when an impairment substantially limits a major life activity (rejecting the Supreme Court's interpretation in Toyota ), and to require that the determination of whether an impairment substantially limits a major life activity must be made without regard to the use of mitigating measures (rejecting the Supreme Court's decisions in Sutton , Murphy , and Kirkingburg ). On March 25, 2011, the Equal Employment Opportunity Commission (EEOC) issued final regulations implementing the ADA Amendments Act. The ADA Amendments Act defines the term disability with respect to an individual as "(A) a physical or mental impairment that substantially limits one or more of the major life activities of such individual; (B) a record of such an impairment; or (C) being regarded as having such an impairment (as described in paragraph (3))." Paragraph (3) discusses the "regarded as" prong of the definition and provides that an individual is "regarded as" having a disability regardless of whether the impairment limits or is perceived to limit a major life activity, and that the "regarded as" prong does not apply to impairments that are transitory and minor. Although this is essentially the same statutory language as was in the original ADA, P.L. 110-325 contains new rules of construction regarding the definition of disability, which provide that the definition of disability shall be construed in favor of broad coverage to the maximum extent permitted by the terms of the act; the term "substantially limits" shall be interpreted consistently with the findings and purposes of the ADA Amendments Act; an impairment that substantially limits one major life activity need not limit other major life activities to be considered a disability; an impairment that is episodic or in remission is a disability if it would have substantially limited a major life activity when active; and the determination of whether an impairment substantially limits a major life activity shall be made without regard to the ameliorative effects of mitigating measures, except that the ameliorative effects of ordinary eyeglasses or contact lenses shall be considered. The findings of the ADA Amendments Act include statements indicating a determination that the Supreme Court decisions in Sutton and Toyota as well as lower court cases had narrowed and limited the ADA from what was originally intended by Congress. P.L. 110-325 specifically states that the then-current Equal Employment Opportunity Commission (EEOC) regulations defining the term "substantially limits" as "significantly restricted" are "inconsistent with congressional intent, by expressing too high a standard." The EEOC issued final ADAAA regulations on March 25, 2011, which will become effective on May 24, 2011. Proposed regulations were published in the Federal Register on September 23, 2009, and the EEOC received over 600 comments and held a series of "Town Hall Listening Sessions." In general, the final regulations streamlined the organization of the proposed regulations, and moved many examples from the regulation to the appendix. The EEOC notes that the appendix will be published in the Code of Federal Regulations (CFR), and "will continue to represent the Commission's interpretation of the issues discussed in the regulations, and the Commission will be guided by it when resolving charges of employment discrimination under the ADA." The final regulations track the statutory language of the ADA but also provide several clarifying interpretations. Several of the major regulatory interpretations are as follows: including the operation of major bodily functions in the definition of major life activities; adding rules of construction for when an impairment substantially limits a major life activity, and providing examples of impairments that will most often be found to substantially limit a major life activity; interpreting the coverage of transitory impairments; interpreting the use of mitigating measures; and interpreting the "regarded as" prong of the definition. The first prong of the statutory definition of disability, referred to by EEOC as "actual disability," provides that an individual with "a physical or mental impairment that substantially limits one or more of the major life activities of such individual" is an individual with a disability. The final regulations provide a list of examples of major life activities. In addition to those listed in the statute (caring for oneself, performing manual tasks, seeing, hearing, eating, sleeping, walking, standing, lifting, bending, speaking, breathing, learning, reading, concentrating, thinking, communicating, and working), the EEOC includes sitting, reaching, and interacting with others. Major life activities also include major bodily functions. In addition to the statutory examples (functions of the immune system, normal cell growth, digestive, bowel, bladder, neurological, brain, respiratory, circulatory, endocrine, and reproductive functions), the EEOC includes special sense organs, genitourinary, cardiovascular, hemic, lymphatic and musculoskeletal. The final regulations also provide that the operation of a major bodily function includes the operation of an individual organ within a body system. The EEOC emphasizes that the ADAAA requires an individualized assessment but notes that because of the statute's requirement for broad coverage, some impairments will almost always be determined to be a disability. The final regulations list impairments that fall within this category. They include deafness, blindness, an intellectual disability, missing limbs or mobility impairments requiring the use of a wheelchair, autism, cancer, cerebral palsy, diabetes, epilepsy, HIV infection, multiple sclerosis, muscular dystrophy, major depressive disorder, bipolar disorder, post-traumatic stress disorder, obsessive compulsive disorder, and schizophrenia. In addition, the EEOC provides that the focus when considering whether an activity is a major life activity should be on "how a major life is substantially limited, and not on what outcomes an individual can achieve." For example, the EEOC noted that an individual with a learning disability my achieve a high level of academic success but may be substantially limited in the major life activity of learning. The final regulations provide rules of construction to assist in determining whether an impairment substantially limits an individual in a major life activity. Generally, the regulations provide that not every impairment is a disability but an impairment does not have to prevent or severely limit a major life activity to be considered substantially limiting. The term substantially limits is to be broadly construed to provide expansive coverage, and requires an individualized determination. The ADAAA specifically provides that an impairment that is episodic or in remission is a disability if it would substantially limit a major life activity when active. In its appendix to the regulations, the EEOC states that "[t]he fact that the periods during which an episodic impairments is active and substantially limits a major life activity may be brief or occur infrequently is no longer relevant to determining whether an impairment substantially limits a major life activity." For example, the EEOC notes that an individual with post-traumatic stress disorder who has intermittent flashbacks is substantially limited in brain function and thinking. A mitigating measure, for example, a wheelchair or medication, eliminates or reduces the symptoms or impact of an impairment. The ADAAA provided that when determining when an impairment substantially limits a major life activity, the ameliorative effects of mitigating measures shall not be used. However, ordinary eyeglasses and contact lenses may be considered. The EEOC final regulations track the statutory language, and also provide that the negative side effects of a mitigating measure may be taken into account in determining whether an individual is an individual with a disability. Although the EEOC would not allow a covered entity to require the use of a mitigating measure, if an individual does not use a mitigating measure, this may affect whether an individual is qualified for a job or poses a direct threat. The third prong of the statutory definition of disability is "being regarded as having an impairment." The ADAAA further describes being regarded as having an impairment by stating that an individual meets this prong of the definition "if the individual establishes that he or she has been subjected to an action prohibited under this Act because of an actual or perceived physical or mental impairment whether or not the impairment limits or is perceived to limit a major life activity." The statute also provides that the "regarded as" prong does not apply to transitory or minor impairments, and a transitory impairment is defined as an impairment with an actual or expected duration of six months or less. The EEOC final regulations echo the statutory language, and encourage the use of the "regarded as" prong when reasonable accommodation is not at issue. The EEOC emphasizes that even if an individual is regarded as having a disability, there is no violation of the ADA unless a covered entity takes a prohibited action, such as not hiring a qualified individual because he or she is regarded as having a disability. A covered entity may challenge a claim under the "regarded as" prong by showing that the impairment is both transitory and minor, or by showing that the individual is not qualified or would pose a direct threat. However, it should be noted that the defense that an impairment is transitory and minor is only available under the "regarded as" prong. The rules of construction discussed previously concerning the first or actual prong specifically state that the effects of an impairment lasting fewer than six months can be substantially limiting.

The ADA Amendment Act (ADAAA), P.L. 110-325, was enacted in 2008 to amend the Americans with Disabilities Act (ADA) definition of disability. On March 25, 2011, the Equal Employment Opportunity Commission (EEOC) issued final regulations implementing the ADAAA. The final regulations track the statutory language of the ADA but also provide several clarifying interpretations. Several of the major regulatory interpretations are, including the operation of major bodily functions in the definition of major life activities; adding rules of construction for when an impairment substantially limits a major life activity and providing examples of impairments that will most often be found to substantially limit a major life activity; interpreting the coverage of transitory impairments; interpreting the use of mitigating measures; and interpreting the "regarded as" prong of the definition.

When a President dies, a number of activities and events are set in motion. The vast majority of these activities and events are governed by custom rather than statute, and may be influenced by the wishes of the deceased President's family. Typically, the incumbent President issues a presidential proclamation that serves as an official announcement of the death. By federal law, U.S. flags should be flown at half-staff for 30 days. In recent decades, presidential proclamations have also given specific guidance where the flag should be flown at half-staff, such as "at the White House and on all buildings, grounds, and naval vessels of the United States for a period of 30 days from the day of his death. I also direct that for the same length of time, the representatives of the United States in foreign countries shall make similar arrangements for the display of the flag at half-staff over their Embassies, Legations, and other facilities abroad, including all military facilities and stations." The Commanding General, Military District of Washington, U.S. Army is responsible for state funeral arrangements, as described in detail in the Army pamphlet entitled State, Official, and Special Military Funerals . According to this document, the current President, ex-President, President-elect, and any other person specifically designated by the current President are entitled to an official state funeral. An excerpt from the pamphlet on key responsibilities and delegations follows: 3. Responsibilities. a. The President notifies the Congress that he has directed that a State Funeral be conducted. The Congress, which has sole authority for use of the U.S. Capitol, makes the Rotunda available for the State Ceremony through its own procedures. b. The Secretary of Defense is the designated representative of the President of the United States. The Secretary of the Army is the designated representative of the Secretary of Defense for the purpose of making all arrangements for State Funerals in Washington, D.C. This includes participation of all Armed Forces and coordination with the State Department for participation of all branches of the Government and the Diplomatic Corps. c. The Commanding General, Military District of Washington, U.S. Army as the designated representative of the Secretary of the Army, will make all ceremonial arrangements for State Funerals in Washington, D.C. and will be responsible for the planning and arranging of State Funerals throughout the continental United States. Many variations of ceremonies and traditional events and activities honoring the former President are possible. A short list of possibilities may include the following: A former President's remains may lie in repose for one day and then be moved to the Capitol Rotunda to lie in state , during which time a funeral ceremony and public viewing may occur . A former President, as former C ommander-in- C hief, is entitled to burial and ceremony in the Arlington National Cemetery. If , however, the former President is to be buried outside of Washington, DC , honors may be rendered at a train station, terminal, or airport that serves as a point of departure for the remains.Other honors that may be rendered during ceremonies include musical honors , gun and cannon salutes , and a U.S. Air Force coordinate d flyover . Most recently, following former President Gerald R. Ford's death on December 26, 2006, President George W. Bush announced the death, and also issued a proclamation that U.S. flags on all federal facilities be flown at half-staff. Two days later, President Bush issued Executive Order 13421, which proclaimed January 2, 2007, a day of respect and remembrance for the former President and ordered the closing of federal offices and agencies. A funeral took place in the Capitol Rotunda on December 30, 2006, where former President Ford lay in state, with subsequent services on January 2, 2007, at Washington National Cathedral. Funeral services for the former President were conducted on January 3, 2007, in Grand Rapids, MI, with interment at the Gerald R. Ford Presidential Library and Museum. Note: .mil web addresses may be more easily accessed using Internet Explorer This website contains information on the evolution of state funerals, military honors for former Presidents, ceremonial traditions of past state funerals (including lying in state or repose), military honors, and FAQs. http://www.usstatefuneral.mdw.army.mil/ This Army pamphlet outlines state and official funeral policy, and it contains detailed information on funeral eligibility, procedures, and sequences of events. http://armypubs.army.mil/epubs/DR_pubs/DR_a/pdf/web/p1_1.pdf The White House Historical Association has published a number of online articles and other content on past funerals. A few selected articles are as follows: A Presidential Funeral https://www.whitehousehistory.org/a-presidental-funeral Arlington ' s Ceremonial Horses and Funerals at the White House https://www.whitehousehistory.org/arlingtons-ceremonial-horses-and-funerals-at-the-white-house-1 Modern Mourning Observations at the White House https://www.whitehousehistory.org/modern-mourning-observations-at-the-white-house To view images, documents, and other materials on presidential funerals, see the Association's digital library: https://www.whitehousehistory.org/digital-library Since 1901, Washington National Cathedral has been the location of funeral and memorial services for several U.S. Presidents: https://cathedral.org/history/prominent-services/presidential-funerals/ Presidential libraries and museums provide preservation of and access to historical materials, including funeral information. Similar or other materials may be viewable online within digital collections at each individual library's website: https://www.archives.gov/presidential-libraries The Library of Congress contains a number of historical papers, images, audio recordings, films, narratives, and other content related to Presidents and corresponding funerals and ceremonies. For help with finding specific items, librarian and reference specialists at the main reading room can provide assistance: http://www.loc.gov/rr/main/ Gerald R. Ford: https://www.c-span.org/video/?195963-1/gerald-ford-michigan-service-burial Ronald W. Reagan: https://www.c-span.org/video/?182165-1/ronald-reagan-funeral-service Richard M. Nixon: https://www.c-span.org/video/?56426-1/president-nixon-funeral Lyndon B. Johnson: https://www.c-span.org/video/?182212-1/lyndon-johnson-funeral-service Harry S. Truman: https://www.youtube.com/watch?v=4Nfo1UjjJXE Dwight D. Eisenhower: http://www.dwightdeisenhower.com/155/Final-Post Herbert Hoover: https://www.youtube.com/watch?v=AtZLxjsX39Q John F. Kennedy: https://www.jfklibrary.org/asset-viewer/archives/JFKWHF/WHN28/JFKWHF-WHN28/JFKWHF-WHN28 Franklin D. Roosevelt: https://www.c-span.org/video/?298665-1/president-franklin-roosevelt-funeral Eleven U.S. Presidents have "lain in state" at the U.S. Capitol Rotunda: http://history.house.gov/Institution/Lie-In-State/Lie-In-State/ The Architect of the Capitol (AOC) provides a brief history of President Lincoln's funeral and his catafalque (currently on display at the U.S. Capitol Visitor's Center): https://www.aoc.gov/blog/lincoln-catafalque-us-capitol Concurrent resolutions have authorized commemorative compilations of tributes delivered in Congress for several former Presidents. These volumes are prepared by the Congressional Research Service under the direction of the Joint Committee on Printing. For example, see President Ford's tribute collection: https://www.gpo.gov/fdsys/pkg/CDOC-110hdoc61/pdf/CDOC-110hdoc61.pdf For further assistance in locating these tribute collections for Presidents (or other individuals), please contact CRS. The AOC has an onsite database of approximately 1,000 images of state funerals at the Capitol for the following presidents: Kennedy, Hoover, Eisenhower, Lyndon B. Johnson, Reagan and Ford. The images depict presidents lying in state in the Rotunda and related funerary ceremonies occurring at the Capitol. For more inquiries into accessing the images, congressional staff may fill out an agency contact form at https://www.aoc.gov/contact-form . Martin Nowak, The White House in Mourning: Deaths and Funerals of Presidents in Office (Jefferson, NC: McFarland, 2010). Brady Carlson, Dead Presidents: A n American A dventure I nto the S trange D eaths and S urprising A fterlives of O ur nation 's L eaders (New York: W.W. Norton, 2017). Brian Lamb and C-SPAN, Who 's Buried in Grant 's Tomb : a Tour of Presidential Gravesites. (New York: Perseus Books Group, 2010). Ambassador Mary Mel French, "Ceremonies: State and Official Funerals," in United States Protocol: The Guide to Official Diplomatic Etiquette (Lanham, MD: Rowman and Littlefield, 2010).

This fact sheet is a brief resource guide for congressional staff on funerals and burials for Presidents of the United States. It contains an overview of past practices for presidential funerals and selected online information resources related to official and ceremonial protocols, past presidential funerals, congressional documents, and other documents and books.

The length of time a congressional staff member spends employed in Congress, or job tenure, is a source of recurring interest among Members of Congress, congressional staff, those who study staffing in the House and Senate , and the public. There may be interest in congressional tenure information from multiple perspectives, including assessment of how a congressional office might oversee human resources issues, how staff might approach a congressional career, and guidance for how frequently staffing changes may occur in various positions. Others might be interested in how staff are deployed, and could see staff tenure as an indication of the effectiveness or well-being of Congress as an institution. This report provides tenure data for 16 staff position titles that are typically used in House Member offices, and information for using those data for different purposes. The positions include the following: Administrative Director Casework Supervisor Caseworker Chief of Staff Communications Director Counsel District Director Executive Assistant Field Representative Legislative Assistant Legislative Correspondent Legislative Director Office Manager Press Secretary Scheduler Staff Assistant Publicly available information sources do not provide aggregated congressional staff tenure data in a readily retrievable or analyzable form. The most recent publicly available House staff compensation report, which provided some insight into the duration which congressional staff worked in a number of positions, was issued in 2010 and relied on anonymous, self-reported survey data. Data in this report are instead based on official House pay reports, from which tenure information arguably may be most reliably derived, and which afford the opportunity to use complete, consistently collected data. Tenure information provided in this report is based on the House's Statement of Disbursements (SOD), published quarterly by the House Chief Administrative Officer, as collated by LegiStorm, a private entity that provides some congressional data by subscription. House Member staff tenure data were calculated for each year between 2006 and 2016. Annual data allow for observations about the nature of staff tenure in House Member offices over time. For each year, all staff with at least one week's service on March 31 were included. All employment pay dates from October 2, 2000, to March 24 of each year are included in the data. Utilizing official salary expenditure data from the House may provide more complete, robust findings than other methods of determining staff tenure, such as surveys; the data presented here, however, are subject to some challenges that could affect the interpretation of the information presented. Tenure information provided in this report may understate the actual time staff spend in particular positons, due in part to several features of the data. Overall, the time frame studied may lead to some underrepresentation in tenure duration. Figure 1 provides potential examples of congressional staff, identified as Jobholders A-D, in a given position. Since tenure data are not captured before October 2, 2000, some individuals, represented as Jobholder A, may have an unknown length of service prior to that date that is not captured. This feature of the data only affects a small number of employees within this dataset, since many tenure periods completely begin and end within the observed period of time, as represented by Jobholders B and C. The data last capture those who were employed in House Members' personal offices as of March 31, 2016, represented as Jobholder D, and some of those individuals likely continued to work in the same roles after that date. Data provided in this report represent an individual's consecutive time spent working in a particular position in the personal office of a House Member. They do not necessarily capture the overall time worked in a House office or across a congressional career. If a person's job title changes, for example, from staff assistant to caseworker, the time that individual spent as a staff assistant is recorded separately from the time that individual spent as a caseworker. If a person stops working for the House for some time, that individual's tenure in his or her preceding position ends, although he or she may return to work in Congress at some point. No aggregate measure of individual congressional career length is provided in this report. Other data concerns arise from the variation across offices, lack of other demographic information about staff, and lack of information about where congressional staff work. Potential differences might exist in the job duties of positions with the same or similar title, and there is wide variation among the job titles used for various positions in congressional offices. The Appendix provides the number of related titles included for each job title for which tenure data are provided. Aggregation of tenure by job title rests on the assumption that staff with the same or similar title carry out the same or similar tasks. Given the wide discretion congressional employing authorities have in setting the terms and conditions of employment, there may be differences in the duties of similarly titled staff that could have effects on the interpretation of their time in a particular position. As presented here, tenure data provide no insight into the education, age, work experience, pay, full- or part-time status of staff, or other potential data that might inform explanations of why a congressional staff member might stay in a particular position. Staff could be based in Washington, DC, district offices, or both. It is unknown whether or to what extent the location of congressional employment might affect the duration of that employment. Tables in this section provide tenure data for selected positions in the personal offices of House Members and detailed data and visualizations for each position. Table 1 provides a summary of staff tenure for selected positions since 2006. The data include job titles, average and median years of service, and grouped years of service for each positon. The "Trend" column provides information on whether the time staff stayed in a position increased, was unchanged, or decreased between 2006 and 2016. Table 2 - Table 17 provide information on individual job titles over the same period. In all of the data tables, the average and the median length of tenure columns provide two different measures of central tendency, and each may be useful for some purposes and less suitable for others. The average represents the sum of the observed years of tenure, divided by the number of staff in that position. It is a common measure that can be understood as a representation of how long an individual remains, on average, in a job position. The average can be affected disproportionately by unusually low or high observations. A few individuals who remain for many years in a position, for example, may draw the average tenure length up for that position. A number of staff who stay in a position for only a brief period may depress the average length of tenure. The median represents the middle value when all the observations are arranged by order of magnitude. Another common measure of central tendency, the median can be understood as a representation of a center point at which half of the observations fall below, and half above. Extremely high or low observations may have less of an impact on the median. Generalizations about staff tenure are limited in at least three potentially significant ways, including: the relatively brief period of time for which reliable, largely inclusive data are available in a readily analyzable form; how the unique nature of congressional work settings might affect staff tenure; and the lack of demographic information about staff for which tenure data are available. Considering tenure in isolation from demographic characteristics of the congressional workforce might limit the extent to which tenure information can be assessed. Additional data on congressional staff regarding age, education, and other elements would be needed for this type of analysis, and are not readily available at the position level. Finally, since each House Member office serves as its own hiring authority, variations from office to office, which for each position may include differences in job duties, work schedules, office emphases, and other factors, may limit the extent to which aggregated data provided here might match tenure in a particular office. Despite these caveats, a few broad observations can be made about staff in House Member offices. Between 2006 and 2016, staff tenure, based on the trend of the median number of years in the position, appears to have increased by six months or more for staff in three position titles in House Member offices. The median tenure was unchanged for 13 positions. This may be consistent with overall workforce trends in the United States. Although pay is not the only factor that might affect an individual's decision to remain in or leave a particular job, staff in positions that generally pay less typically remained in those roles for shorter periods of time than those in higher-paying positions. Some of these lower-paying positions may also be considered entry-level positions in some House Member offices; if so, House office employees in those roles appear to follow national trends for others in entry-level types of jobs, remaining in the role for a relatively short period of time. Similarly, those in more senior positions, which often require a particular level of congressional or other professional experience, typically remained in those roles comparatively longer, similar to those in more senior positions in the general workforce. There is wide variation among the job titles used for various positions in congressional offices. Between October 2000 and March 2016, House and Senate pay data provided 13,271 unique titles under which staff received pay. Of those, 1,884 were extracted and categorized into one of 33 job titles used in CRS Reports about Member or committee offices. Office type was sometimes related to the job titles used. Some titles were specific to Member (e.g., District Director, State Director, and Field Representative) or committee (positions that are identified by majority, minority, or party standing, and Chief Clerk) offices, while others were identified in each setting (Counsel, Scheduler, Staff Assistant, and Legislative Assistant). Other job title variations reflect factors specific to particular offices, since each office functions as its own hiring authority. Some of the titles may distinguish between roles and duties carried out in the office (e.g., chief of staff, legislative assistant, etc.). Some offices may use job titles to indicate degrees of seniority. Others might represent arguably inconsequential variations in title between two staff members who might be carrying out essentially similar activities. Examples include: Seemingly related job titles, such as Administrative Director and Administrative Manager, or Caseworker and Constituent Advocate Job titles modified by location, such as Washington, DC, State, or District Chief of Staff Job titles modified by policy or subject area, such as Domestic Policy Counsel, Energy Counsel, or Counsel for Constituent Services Committee job titles modified by party or committee subdivision. This could include a party-related distinction, such as a Majority, Minority, Democratic, or Republican Professional Staff Member. It could also denote Full Committee Staff Member, Subcommittee Staff Member, or work on behalf of an individual committee leader, like the chair or ranking member. The titles used in this report were used by most House Members' offices, but a number of apparently related variations are included to ensure inclusion of additional offices and staff. Table A-1 provides the number of related titles included for each position used in this report or related CRS Reports on staff tenure. A list of all titles included by category is available to congressional offices upon request.

The length of time a congressional staff member spends employed in a particular position in Congress—or congressional staff tenure—is a source of recurring interest to Members, staff, and the public. A congressional office, for example, may seek this information to assess its human resources capabilities, or for guidance in how frequently staffing changes might be expected for various positions. Congressional staff may seek this type of information to evaluate and approach their own individual career trajectories. This report presents a number of statistical measures regarding the length of time House office staff stay in particular job positions. It is designed to facilitate the consideration of tenure from a number of perspectives. This report provides tenure data for a selection of 16 staff position titles that are typically used in House Member offices, and information on how to use those data for different purposes. The positions include Administrative Director, Casework Supervisor, Caseworker, Chief of Staff, Communications Director, Counsel, District Director, Executive Assistant, Field Representative, Legislative Assistant, Legislative Correspondent, Legislative Director, Office Manager, Press Secretary, Scheduler, and Staff Assistant. House Members' staff tenure data were calculated as of March 31, for each year between 2006 and 2016, for all staff in each position. An overview table provides staff tenure for selected positions for 2016, including summary statistics and information on whether the time staff stayed in a position increased, was unchanged, or decreased between 2006 and 2016. Other tables provide detailed tenure data and visualizations for each position title. Between 2006 and 2016, staff tenure appears to have increased by six months or more for staff in three position titles in House Member offices, based on the trend of the median number of years in the position. For 13 positions, the median tenure was unchanged. These findings may be consistent with overall workforce trends in the United States. Pay may be one of many factors that affect an individual's decision to remain in or leave a particular job. House Member office staff holding positions that are generally lower-paid typically remained in those roles for shorter periods of time than those in generally higher-paying positions. Lower-paying positions may also be considered entry-level roles; if so, tenure for House Member office employees in these roles appears to follow national trends for other entry-level jobs, which individuals hold for a relatively short period of time. Those in more senior positions, where a particular level of congressional or other professional experience is often required, typically remained in those roles comparatively longer, similar to those in more senior positions in the general workforce. Generalizations about staff tenure are limited in some ways, because each House office serves as its own hiring authority. Variations from office to office, which might include differences in job duties, work schedules, office emphases, and other factors, may limit the extent to which data provided here might match tenure in another office. Direct comparisons of congressional employment to the general labor market may have similar limitations. An employing Member's retirement or electoral loss, for example, may cause staff tenure periods to end abruptly and unexpectedly. This report is one of a number of CRS products on congressional staff. Others include CRS Report R43947, House of Representatives Staff Levels in Member, Committee, Leadership, and Other Offices, 1977-2016 and CRS Report R44323, Staff Pay Levels for Selected Positions in House Member Offices, 2001-2014.

Many Members of Congress see continued tension between "free speech" decisions of the Supreme Court, which protect flag desecration as expressive conduct under the First Amendment, and the symbolic significance of the United States flag. Consequently, every Congress that has convened since those decisions were issued has considered measures to permit the punishment of those who engage in flag desecration. This report is divided into two parts. The first gives a brief history of the flag protection issue, from the enactment of the Flag Protection Act in 1968 through current consideration of a constitutional amendment. The second part briefly summarizes the two decisions of the United States Supreme Court, Texas v. Johnson and United States v. Eichman , that struck down the state and federal flag protection statutes as applied in the context punishing expressive conduct. In 1968, in the midst of the Vietnam conflict, Congress enacted the first Federal Flag Protection Act of general applicability. The law was occasioned by the numerous public flag burnings in protest of the war. For the next 20 years, the lower courts upheld the constitutionality of the federal statute and the Supreme Court declined to review these decisions. However, during the 20-year period between enactment of the Flag Protection Act and its Johnson decision, the Supreme Court did visit the flag issue three times. Each time the Court found a way to rule in favor of the protestor and overturn a state conviction on very narrow grounds, avoiding a definitive ruling on the constitutionality of convictions for politically inspired destruction or alteration of the American flag. In Street v. New York , the Court overturned a state conviction for flag-burning, holding that the flag-burner was prosecuted for his words rather than his acts. In 1974, the Court overturned a prosecution by finding that the state statute was vague. In Spence v. Washington , the Court held that the taping of a peace symbol to a flag was expressive conduct and thus protected by the First Amendment. In both of these later cases the Court expressly referred to the federal statute in a positive manner. It was against this background that the Supreme Court took the Johnson case. In 1984, during the Republican National Convention in Dallas, TX, Johnson had participated in a demonstration protesting the policies of the Reagan Administration. In front of the city hall, Johnson unfurled an American flag, which another member of the demonstration had taken from a flag pole and had given to him, doused it with kerosene, and set it on fire. He was charged with the desecration of a venerated object in violation of a Texas statute. Johnson was tried, convicted, and sentenced to one year in prison and fined $2,000. The conviction was upheld by the Court of Appeals of the Fifth District of Texas at Dallas. The Texas Court of Criminal Appeals reversed. In a 5 to 4 decision, the U.S. Supreme Court affirmed this reversal on June 21, 1989, thus, in effect, holding that the flag protection statutes of 47 states and the federal statute could not be applied to a flag burning that was part of a public demonstration. In response to this decision, Congress enacted the Flag Protection Act of 1989. The act changed the focus of the protection granted the flag from protecting it against desecration, which the Court had ruled unconstitutional, to protecting its physical integrity. The primary purpose of amending the federal desecration statute was to remove any language which the courts might find made the statute one that was aimed at suppressing a certain type of expression. If the statute was neutral as to expression—for instance, if it proscribed all burning of flags—then, its proponents argued, the statute's prohibitions might be judged under the constitutional test enunciated by the Court in United States v. O ' Brien. Under the O ' Brien test, which is less strict than First Amendment standards applied in expression cases, the government need only show that the statute furthers an important or substantial governmental interest, and that the restriction on First Amendment freedoms is no greater than is essential to the furtherance of that interest. All of the opinions in Johnson had recognized a governmental interest in protecting the physical integrity of the flag to some degree. Therefore, it was at least arguable that such a neutral statute would meet the second part of the test. The new statute made criminal intentionally mutilating, defacing, physically defiling, burning, maintaining on the floor or ground, or trampling upon the flag of the United States. Exemption was given for conduct consisting of disposal of a worn or soiled flag. The term "flag of the United States" was defined to mean any flag of the United States, or any part thereof, made of any substance, of any size, in a form that is commonly displayed. Provision was made for expedited Supreme Court review of the constitutionality of the act. The Flag Protection Act of 1989 became effective on October 28, 1989. On that date protesters in Seattle, WA, and Washington, DC, were arrested for violation of the new act. These cases were dismissed upon findings that the act was unconstitutional as applied to their burning a United States flag in a protest context. The D.C. and Seattle cases were appealed to the Supreme Court under the act's expedited review provision. On June 11, 1990, the Court announced its ruling. In another 5 to 4 decision, the Court held that the Flag Protection Act of 1989 could not be constitutionally applied to a burning of the flag in the context of a public protest. In the summer of 1990, both houses of Congress considered and failed to pass by the required two-thirds vote an amendment to the Constitution which would have empowered Congress to enact legislation to protect the physical integrity of the flag. In six of the last eight Congresses, the House passed proposed constitutional amendments which would have authorized Congress to enact legislation to protect the flag from physical desecration. In the 104 th Congress, the Senate considered a "flag" amendment, but came three votes short of passing it. In the 106 th Congress, S.J.Res. 14 failed, by a vote of 63-37, to receive the necessary two-thirds vote in the Senate. In the 109 th Congress, S.J.Res. 12 failed by a vote of 66 to 34 (one vote short of the necessary two-thirds required for passage). There were no "flag" amendment votes in the Senate in the 105 th , 107 th , 108 th ,110 th , , or 111 th Congresses. In the 112 th Congress, an amendment to the Constitution of the United States to prohibit desecration of the flag has been introduced in both the House and the Senate. H.J.Res. 13 proposes an amendment to the Constitution of the United States which would authorize the Congress to prohibit the physical desecration of the flag of the United States. On Flag Day of 2011, Senator Hatch introduced an identical bill, S.J.Res. 19 , in the Senate. Should Congress approve a proposed flag protection amendment by the required two-thirds majority of each house, the amendment would only become effective upon ratification by the legislatures of three-fourths of the states. In Texas v. Johnson , the majority of the Court held that Johnson's conviction for flag desecration, under a Texas statute, was inconsistent with the First Amendment and affirmed the decision of the Texas Court of Criminal Appeals that held that Johnson could not be punished for burning the flag as part of a public demonstration. The opinion outlined the questions to be addressed in a case where First Amendment protection is sought for conduct rather than pure speech. First, the Court must determine if the conduct in question is expressive conduct. If the answer is yes, then the First Amendment may be invoked, and the second question must be answered. The second question is whether the state regulation of the conduct is related to the suppression of expression. The answer to this question determines the standard which will be utilized in judging the appropriateness of the state regulation. The test of whether conduct is deemed expressive conduct sufficient to bring the First Amendment into play is whether an intent to convey a particularized message was present, and whether the likelihood was great that the message would be understood by those who viewed it. The opinion emphasized the communicative nature of flags as previously recognized by the Court, but stated that not all action taken with respect to the flag is automatically expressive. The context in which the conduct occurred must be examined. The majority found that Johnson's conduct met this test. The burning of the flag was the culmination of a political demonstration. It was intentionally expressive, and its meaning was overwhelmingly apparent. In these circumstances the burning of the flag was conduct "sufficiently imbued with elements of communication" to implicate the First Amendment. The finding that burning the flag in this circumstance was expressive conduct required the Court next to look at the statute involved to see if it was directly aimed at suppressing expression or if the governmental interest to be protected by the statute was unrelated to the suppression of free expression. If the statute were of the latter type, the government would need only show that it furthered an important or substantial governmental interest, and that the restriction on First Amendment freedoms was no greater than is essential to the furtherance of that interest. If the statute was aimed at suppression of expression, then it could be upheld only if it passed the most exacting scrutiny. Texas offered two state interests which it sought to protect with this statute: prevention of breaches of the peace; and preservation of the flag as a symbol of nationhood and national unity. The majority rejected the first of these interests as not being implicated in the facts of this case. No disturbance of the peace actually occurred or was threatened. The opinion also pointed out that Texas had a statute specifically prohibiting breaches of the peace, which tended to confirm that flag desecration need not be punished to keep the peace. The second governmental interest, that of preserving the flag as a symbol of national unity, was found by the majority to be directly related to expression in the context of activity. The Texas law did not cover all burning of flags. Rather it was designed to protect the flag only against abuse that would be offensive to others. Whether Johnson's treatment of the flag was proscribed by the statute could only be determined by the content of his expression. Therefore, an exacting scrutiny standard of review had to be applied to the statute. The majority held that the Texas statute could not withstand this level of scrutiny. There is no separate constitutional category for the American flag. The government may not prohibit expression of an idea merely because society finds the idea offensive, even when the flag is involved. Nor may a state limit the use of designated symbols to communicate only certain messages. The Court, in reviewing the Flag Protection Act of 1989 in United States v. Eichman , expressly declined the invitation to reconsider Johnson and its rejection of the contention that flag-burning as a mode of expression, like obscenity or "fighting words," does not enjoy the full protection of the First Amendment. The only question not addressed in Johnson , and therefore the only question the majority felt necessary to address, was "whether the Flag Protection Act is sufficiently distinct from the Texas statute that it may constitutionally be applied to proscribe appellees' expressive conduct." The government argued that the governmental interest served by the act was protection of the physical integrity of the flag. This interest, it was asserted, was not related to the suppression of expression, and the act contained no explicit content-based limitations on the scope of the prohibited conduct. Therefore the government should only need to show that the statute furthers an important or substantial governmental interest, and that the restriction on First Amendment freedoms is no greater than is essential to the furtherance of that interest. The majority, while accepting that the act contained no explicit content-based limitations, rejected the claim that the governmental interest was unrelated to the suppression of expression. The Court stated: The Government's interest in protecting the "physical integrity" of a privately owned flag rests upon a perceived need to preserve the flag's status as a symbol of our Nation and certain national ideals. But the mere destruction or disfigurement of a particular physical manifestation of the symbol, without more, does not diminish or otherwise affect the symbol itself in any way. For example, the secret destruction of a flag in one's own basement would not threaten the flag's recognized meaning. Rather, the Government's desire to preserve the flag as a symbol for certain national ideals is implicated "only when a person's treatment of the flag communicates [a] message" to others that is inconsistent with those ideals. In essence the Court said that the interest protected by the act was the same interest which had been put forth to support the Texas statute and rejected in Johnson . The opinion went on to analyze the language of the act itself. Again, while there was no explicit limitation found in this language, the majority found that each of the specified terms, with the possible exception of "burns," unmistakably connoted disrespectful treatment of the flag and thus could not be viewed as neutral as to expression. Therefore, although the act was "somewhat broader" than the Texas statute, it still suffered from the same fundamental flaw, namely it suppressed expression out of concern for its likely communicative impact. This being the case, the majority found that the O ' Brien test was inapplicable and the act must be subject to "the most exacting scrutiny." As in Johnson , the statute in question could not withstand this level of scrutiny.

This report is divided into two parts. The first gives a brief history of the flag protection issue, from the enactment of the Flag Protection Act in 1968 through current consideration of a constitutional amendment. The second part briefly summarizes the two decisions of the United States Supreme Court, Texas v. Johnson and United States v. Eichman, that struck down the state and federal flag protection statutes as applied in the context punishing expressive conduct. In 1968, Congress reacted to the numerous public flag burnings in protest of the Vietnam conflict by passing the first federal flag protection act of general applicability. For the next 20 years, the lower courts upheld the constitutionality of this statute and the Supreme Court declined to review these decisions. However, in Texas v. Johnson, the majority of the Court held that a conviction for flag desecration under a Texas statute was inconsistent with the First Amendment and affirmed a decision of the Texas Court of Criminal Appeals that barred punishment for burning the flag as part of a public demonstration. In response to Johnson, Congress passed the Flag Protection Act of 1989. But, in reviewing this act in United States v. Eichman, the Supreme Court expressly declined the invitation to reconsider Johnson and its rejection of the contention that flag-burning, like obscenity or "fighting words," does not enjoy the full protection of the First Amendment as a mode of expression. The only question not addressed in Johnson, and therefore the only question the majority felt necessary to address, was "whether the Flag Protection Act is sufficiently distinct from the Texas statute that it may constitutionally be applied to proscribe appellees' expressive conduct." The majority of the Court held that it was not. Many Members of Congress see continued tension between "free speech" decisions of the Supreme Court, which protect flag desecration as expressive conduct under the First Amendment, and the symbolic importance of the United States flag. Consequently, every Congress that has convened since those decisions were issued has considered proposals that would permit punishment of those who engage in flag desecration. In six of the last eight Congresses, the House passed proposed constitutional amendments which would have authorized Congress to enact legislation to protect the flag from physical desecration. In the 104th Congress, the Senate considered a "flag" amendment, but came three votes short of passing it. In the 106th Congress, S.J.Res. 14 failed, by a vote of 63-37, to receive the necessary two-thirds vote in the Senate. In the 109th Congress, S.J.Res. 12 failed by a vote of 66 to 34 (one vote short of the necessary two-thirds required for passage). There were no "flag" amendment votes in the Senate in the 105th, 107th, 108th, 110th, or 111th Congresses. In the 112th Congress, an amendment to the Constitution of the United States to prohibit desecration of the flag has been introduced in both the House and the Senate. H.J.Res. 13 proposes an amendment to the Constitution of the United States which would authorize Congress to prohibit the physical desecration of the flag of the United States. An identical bill, S.J.Res. 19, has been introduced in the Senate.

In June 2007, the Supreme Court issued its decision in Ledbetter v. Goodyear Tire & Rubber Co., Inc. , a case that involved questions about the timeliness of claims filed under Title VII of the Civil Rights Act, which prohibits discrimination in employment on the basis of race, color, religion, sex, or national origin. By a 5-4 vote margin, the Court rejected the plaintiff's argument that each paycheck she received reflected a lower salary due to past discrimination and therefore constituted a new violation of the statute. Instead, the Court held that "a new violation does not occur, and a new charging period does not commence, upon the occurrence of subsequent nondiscriminatory acts that entail adverse effects resulting from the past discrimination." As a result, the Court held that the plaintiff had not filed suit in a timely manner. Initially, the decision appeared to limit some pay discrimination claims based on Title VII, but did not affect an individual's ability to sue for sex discrimination that results in pay bias under the Equal Pay Act. Although the Court's decision made it more difficult for employees to sue for pay discrimination under Title VII, the decision was recently superseded by the Lilly Ledbetter Fair Pay Act of 2009, which amended Title VII to clarify that the time limit for suing employers for pay discrimination begins each time they issue a paycheck. From 1979 until 1998, Lilly Ledbetter worked as a supervisor for the Goodyear Tire & Rubber Company. Although Ledbetter initially received a salary similar to the salaries paid to her male colleagues, a pay disparity developed over time. By 1997, the pay disparity between Ledbetter and her 15 male counterparts had widened considerably, to the point that Ledbetter was paid $3,727 per month while the lowest paid male colleague received $4,286 per month and the highest-paid male colleague received $5,236 per month. In 1998, Ledbetter filed a charge of discrimination with the Equal Employment Opportunity Commission (EEOC) alleging that Goodyear had unlawfully discriminated against her on the basis of her sex in violation of Title VII. According to Ledbetter, her current pay was discriminatorily low due to a long series of decisions reflecting Goodyear's pervasive discrimination against female managers in general and Ledbetter in particular. A jury found in her favor, and the district court entered judgment for backpay and damages, but the appellate court reversed. The Supreme Court granted review in order to resolve disagreement among the appellate courts regarding the proper application of the time limit for filing claims in Title VII disparate treatment pay cases. Under Title VII, it is an "unlawful employment practice" for an employer to discriminate "against any individual with respect to his compensation ... because of such individual's race, color, religion, sex, or national origin." Individuals who want to challenge an employment practice as unlawful are required to file a charge with the EEOC within a specified period—either 180 days or 300 days, depending on the state—"after the alleged unlawful employment practice occurred." The question that arose in the Ledbetter case was how to determine precisely what types of activities constitute an unlawful employment practice for purposes of starting the clock on the filing deadline. Ledbetter argued that two different employment practices could qualify as having occurred within the 180-day charging period preceding the filing of her EEOC claim: (1) the paychecks that were issued to her during that period, each of which she alleged constituted a separate act of discrimination, or (2) a 1998 decision denying her a raise, which she contended was unlawful because it perpetuated the discriminatory pay decisions from previous years. In contrast, Goodyear argued that Ledbetter's claim was time barred because the discriminatory acts that affected her current pay had taken place prior to the 180 days that preceded the claim Ledbetter filed with the EEOC. The Supreme Court granted review to resolve the dispute. Ultimately, the Supreme Court ruled in favor of Goodyear, holding that Ledbetter's suit was time barred because no unlawfully discriminatory acts had taken place within the 180-day charging period. In rejecting Ledbetter's claim on statutory grounds, the Court majority relied heavily on the principle that Title VII claims alleging disparate treatment require evidence of discriminatory intent. Because there was no evidence that Goodyear had acted with discriminatory intent when it issued the paychecks Ledbetter received during the charging period or when the company had denied her a raise in 1998, the Court found that Goodyear had not engaged in an unlawful employment practice during the specified time period. As a result, the fact that Ledbetter may have been suffering from the continuing effects of past discrimination was not sufficient for her to establish a claim within the statutorily mandated filing period. In issuing its decision, the Ledbetter majority relied on a series of precedents in analogous employment discrimination cases. For example, one such case, United Air Lines, Inc. v. Evans , involved a female flight attendant who was not granted seniority when she was rehired despite the fact that she had originally been forced to resign when she got married. Although the Court agreed that the company's discriminatory policy had a continuing effect, that effect was not sufficient to establish a present violation. Similarly, in Lorance v. AT&T Technologies, Inc. , the Court rejected a challenge to a discriminatory seniority system because the complaint had been filed when the discriminatory effect was felt, rather than within the charging period established by the original discriminatory act, namely the adoption of the seniority system. In light of these and other precedents, the Court concluded: The EEOC charging period is triggered when a discrete unlawful practice takes place. A new violation does not occur, and a new charging period does not commence, upon the occurrence of subsequent nondiscriminatory acts that entail adverse effects resulting from the past discrimination. But of course, if an employer engages in a series of acts each of which is intentionally discriminatory, then a fresh violation takes place when each act is committed.... [C]urrent effects alone cannot breathe life into prior, uncharged discrimination.... Of primary concern to the Court was the question of discriminatory intent. In general, claims such as Ledbetter's, which allege unlawful disparate treatment, must demonstrate discriminatory intent. According to the Court, allowing Ledbetter to shift the intent associated with the discriminatory pay decisions to later paychecks would have the effect of imposing liability in the absence of the required intent. The Court also appeared concerned that allowing Ledbetter's claim to proceed would undermine Title VII enforcement procedures and filing deadlines, which were designed in part to protect employers from defending against discrimination claims that are long past. According to the Court, Title VII's short filing deadline "reflects Congress' strong preference for the prompt resolution of employment discrimination allegations through voluntary conciliation and cooperation." The Court also rejected Ledbetter's reliance on Bazemore v. Friday , a pay discrimination case involving employees who were, prior to enactment of Title VII, separated into a white branch and a black branch, with the latter group receiving lower salaries. Although the Bazemore Court held that an employer who adopts a discriminatory pay structure violates Title VII whenever it issues a paycheck to disfavored employees, the Ledbetter Court distinguished the two cases, arguing that the paychecks in Bazemore reflected the employer's ongoing retention of a discriminatory pay structure—a current violation of the statute—while the paychecks in Ledbetter reflected the continuing effect of an isolated, past violation of the statute. Finally, although the EEOC has interpreted Title VII to allow challenges based on discriminatory pay each time a paycheck is received, the Court declined to defer to the agency's interpretation. In contrast, the dissent in Ledbetter strongly disagreed with the majority's analysis. According to the dissent, treating the actual payment of a discriminatory wage as an unlawful employment practice would be more faithful to precedent, would better reflect workplace realities, and would be more consistent with the overall purpose of Title VII. Specifically, the dissent argued that the Court's holding was inconsistent with the result in Bazemore , contending that Bazemore recognized that paychecks that perpetuate past discrimination constitute a fresh instance of discrimination every time they are issued. The dissent also drew an analogy between pay discrimination claims and sexual harassment hostile work environment claims, which involve a series of discrete acts that recur and are cumulative in impact. Since hostile work environment claims may be filed even when some of the discrete acts that form the basis for a claim have taken place outside of the charging period, the dissent would have allowed Ledbetter's claim to proceed as well. The dissent also distinguished pay bias claims from other types of employment discrimination, arguing that pay discrimination is fundamentally different from other types of employment bias. For example, employees, who are generally aware when they suffer adverse employment actions related to promotion, transfer, hiring, or firing, may not know they have suffered pay discrimination, particularly because salary levels are often hidden from the employee's view and pay disparities become apparent only over time. As a result of these differences, the dissent argued that the precedents upon which the Court relied were inapplicable because those cases involved easily identifiable acts of discrimination. Finally, the dissent criticized the majority's opinion as inconsistent with the overall anti-discrimination purpose of Title VII. Although the Ledbetter decision was subsequently overturned by statute, at the time of the ruling, many commentators noted the possible effects that the case could have on the workplace. First, employees might have had a more difficult time bringing pay discrimination claims under Title VII. If employees brought pay discrimination claims early in order to meet the statutory filing deadline, they might have had difficulty proving discrimination if the pay disparity remained small. If employees brought pay discrimination claims later, however, then they might not have been able to meet the filing deadline. As a result of this dilemma, employers might have experienced an increase in pay discrimination claims being filed against them, since some employees might have filed claims in order to meet the deadline even in cases where discrimination was unclear. It is also important to note that the Ledbetter decision affected more than just pay bias cases involving sex discrimination. Because Title VII applies to discrimination on the basis of race, color, national origin, sex, and religion, many other classes of claimants were potentially affected by the decision. Furthermore, the Ledbetter case also affected pay discrimination under parallel employment discrimination statutes that are patterned on Title VII, such as the Age Discrimination in Employment Act (ADEA), the Rehabilitation Act of 1973, and the Americans with Disabilities Act (ADA). Employees who filed pay discrimination claims alleging race or age discrimination, for example, might have been more negatively affected by the decision than employees who alleged sex discrimination because the latter group still had recourse under the Equal Pay Act (EPA). The EPA, which prohibits discrimination on the basis of sex with regard to the compensation paid to men and women for substantially equal work performed in the same establishment, does contain a statute of limitations for filing claims but has, thus far, been interpreted in such a way that each issuance of an unequal paycheck is treated as a new discriminatory act. In addition, the Ledbetter decision spurred congressional efforts to overturn the ruling. Since Ledbetter was decided on statutory grounds, several legislators who disagreed with the Court's interpretation introduced legislation clarifying that unlawful employment practices under Title VII include each issuance of a paycheck that reflects a discriminatory compensation practice. Such congressional action is not uncommon. For example, the Lorance decision, cited as precedent by the Ledbetter majority, was subsequently superseded by Congress in the Civil Rights Act of 1991. After the Ledbetter decision was handed down, several bills to amend Title VII in light of the opinion were introduced in both the 110 th and 111 th congressional sessions. As passed by Congress and signed into law by President Obama on January 29, 2009, the Lilly Ledbetter Fair Pay Act of 2009 ( H.R. 11 / S. 181 ) clarifies that the time limit for suing employers for pay discrimination begins each time they issue a paycheck and is not limited to the original discriminatory action. This change is applicable not only to Title VII of the Civil Rights Act, but also to the Age Discrimination in Employment Act (ADEA), the Rehabilitation Act of 1973, and the Americans with Disabilities Act (ADA).

This report discusses Ledbetter v. Goodyear Tire & Rubber Co., Inc., a case in which the Supreme Court considered the timeliness of a sex discrimination claim filed under Title VII of the Civil Rights Act, which prohibits employment discrimination on the basis of race, color, religion, sex, or national origin. In Ledbetter, the female plaintiff alleged that past sex discrimination had resulted in lower pay increases and that these past pay decisions continued to affect the amount of her pay throughout her employment, resulting in a significant pay disparity between her and her male colleagues by the end of her nearly 20-year career. Under Title VII, a plaintiff is required to file suit within 180 days after an alleged unlawful employment practice has occurred. Although the plaintiff in Ledbetter argued that each paycheck she received constituted a new violation of the statute and therefore reset the clock with regard to filing a claim, the Court rejected this argument, reasoning that even if employees suffer continuing effects from past discrimination, their claims are time barred unless filed within the specified number of days of the original discriminatory act. On January 29, 2009, President Obama signed the Lilly Ledbetter Fair Pay Act of 2009 (H.R. 11/S. 181). This legislation supersedes the Ledbetter decision by amending Title VII to clarify that the time limit for suing employers for pay discrimination begins each time they issue a paycheck.

Problems for patients associated with dramatic increases in the cost of prescription medications have generated a great deal of interest among the media, interest groups, and legislators alike. Although no broad consensus exists regarding the causes of—and thus solutions to—the rapid increase in many pharmaceutical prices, policymakers have explored a number of options, including the recycling of unadulterated surplus drugs. Currently, many health care institutions, especially long-term care facilities (LTCFs), routinely dispose of medications that otherwise have a useful life. This practice typically occurs when drugs are dispensed to patients but remain unused because the patient switches medication, is discharged, or dies. Studies have estimated that more than one billion dollars worth of drugs are discarded each year in the United States. One way to counter this costly practice is to recycle the unused medications. However, the ability to implement recycling programs may be constrained by federal and/or state law. Current regulation of pharmaceuticals and those who dispense them consists of a complex system of federal and state laws. There are three federal laws discussed below that may impede the practice of recycling medications. At the state level, state controlled substances laws, pharmacy laws, and other rules promulgated by state boards of pharmacy govern practices relating to the manufacture, distribution, and possession of medicines. Nevertheless, state legislatures that have implemented drug recycling programs appear to tailor them to conform to existing regulations. State laws vary greatly regarding who may return and accept the medications, which medications may be recycled, and the procedures in place to safeguard against adulteration or unlawful possession of the medications. Federal laws regulating pharmaceuticals pose potential obstacles to the implementation of drug recycling programs. Specifically, many of the medications covered by recycling programs are considered controlled substances and thus are subject to the requirements of the Controlled Substances Act (CSA). Furthermore, most, if not all, of the drugs in question also require a prescription in order to be dispensed, and therefore are regulated by the Federal Food, Drug, and Cosmetics Act (FFDCA) —thus adding another layer of federal statutory regulations. Additionally, programs to recycle medications may also encounter logistical problems relating to billing under the Health Insurance Accountability and Portability Act (HIPAA). One potential impediment to drug recycling programs is the CSA. Enacted in 1970 with the main objectives of combating drug abuse and controlling traffic in controlled substances, the CSA created a regulatory regime criminalizing the unauthorized manufacture, distribution, dispensation, and possession of the substances covered by the act. Enforced by the federal Drug Enforcement Agency (DEA), the CSA establishes civil as well as criminal sanctions for its violation. The CSA is relevant to drug recycling programs because most, if not all, of the costly medications the programs seek to recycle are considered controlled substances under the CSA. Practitioners who dispense or administer controlled substances listed on Schedules II through V, including substances that may not require a prescription, must register with the DEA. Entities that apply for federal registration to handle controlled substances and those so registered must provide effective controls and procedures to guard against theft and diversion of controlled substances in accordance with security requirements. These requirements vary depending on the type of activity and the substances. However, unlike hospitals and pharmacies, most long-term care facilities (LTCFs) are not registrants. Due to the stringent safety standards imposed on registrants, registration may not be feasible or cost-effective for many facilities to implement. Because of the prohibition against handling or possessing controlled substances without DEA registration, the CSA seems to preclude LTCFs—or any entity not registered with the DEA—from effectively participating in a drug recycling program. As a result, the DEA distribution system, which is designed to prevent diversion by establishing a closed distribution loop among registrants for purposes of tracking all entities that handle controlled substances prior to dispensing, often prevents LTCFs from returning such drugs to pharmacy stock and forces them to destroy any unused controlled substances. An alternative to recycling programs that LTCFs may wish to pursue is the installation of automated dispensing systems (ADS). Similar to a vending machine, an ADS is stocked with drugs by a pharmacy, which controls the device remotely and programs it to dispense drugs on a single-dose basis. The DEA recently promulgated a rule to allow this practice as a way to "mitigate the problem of excess stocks and disposal." Using this system, the drugs are not deemed to be dispensed until provided by the ADS, so any unused drugs remain in pharmacy stock. Recycling programs must also comply with statutes that regulate the safety and efficacy of prescription drugs. Federally, this regulation occurs under the FFDCA. One of the purposes of the FFDCA is to ensure drug safety by prohibiting the introduction of adulterated or misbranded foods, drugs, or cosmetics into interstate commerce. Therefore, programs to recycle unused prescription drugs may encounter barriers if such recycling could lead to drug adulteration or misbranding. The federal Food and Drug Administration's (FDA) policy guidance reflects these concerns. In guidance that dates back to 1980, the agency states, "[a] pharmacist should not return drug products to his stock once they have been out of his possession. It could be a dangerous practice for pharmacists to accept and return to stock the unused portions of prescriptions that are returned by patrons, because he would no longer have any assurance of the strength, quality, purity, or identity of the articles." However, the FDA has no specific regulations regarding drug recycling programs and leaves these programs to the discretion of the state so long as state legislation does not offend applicable regulations relating to the safety and efficacy of prescription medications. A smaller administrative obstacle to the effective implementation of drug recycling programs is the billing requirements under HIPAA. This law requires electronic transactions for operations conducted by pharmacies—the entities that are responsible for accepting unused medications in many recycling programs. Every transaction that occurs within a pharmacy must be part of the HIPAA Transactions Code Set. However, there is currently no code for returning an unused drug to stock for credit. Without this code, such transactions cannot be properly documented and accounted for, posing an obstacle for pharmacists and doctors who would participate in drug recycling programs. In recent years, several states have attempted to combat waste associated with discarding unused medications by creating drug recycling programs. These programs aren't "as simple as returning 'leftovers.'" Rather, most state legislation typically specifies who may return the unused medication, who may accept the medication, what types of medications may be returned, and to whom the medications may be redistributed. This section provides examples of current practices regarding such recycling programs. Most laws specify who may return, who may accept, and/or who may receive unused medications. Some states allow patients to donate, while others restrict the practice to pharmacies, doctors and wholesale distribution centers. Iowa, which falls in the former category, allows any person to donate unused medications. In contrast, California law allows donations only from drug manufacturers, licensed health care facilities, and pharmacies. Some states do not place restrictions on the drugs included in their recycling program, while others specify the types they will accept. For example, Nebraska restricts its drug repository program to cancer drugs. Wisconsin began its recycling program as a cancer drug repository, but later expanded it to include prescription drugs and supplies for all other chronic diseases such as diabetes. States also impose restrictions to ensure that the medications are safe. Safety requirements are fairly uniform across most states. They typically require that medications be in their original, unopened sealed packaging or in single unit doses that are individually contained in unopened, tamper-evident packaging. Most states also prohibit the return of medications that will expire within six months or appear to be adulterated or misbranded in any way. Despite the precautions states have attempted to build into their recycling programs, some people remain unconvinced that these programs are completely safe. Critics argue that insufficient safety controls may lead to adulterated, dangerous medicines, and drugs that land in the wrong hands. They also argue that the actual process of repackaging medications can pose safety hazards. Nevertheless, states seem intent on continuing to tailor their legislation in order to conform to existing law, while simultaneously acting as laboratories to test new cost-effective measures.

In recent years, the rising costs of prescription drugs have motivated various policymakers to implement cost-saving measures. In some cases, states have pursued programs to collect and redistribute unused medications that would otherwise be discarded. However, the ability to implement these so-called drug recycling programs may be constrained by federal or state law or both. For example, medications classified as controlled substances are regulated by the Controlled Substances Act (CSA). Furthermore, drugs that require prescriptions, as many controlled substances do, are regulated by the Federal Food, Drug, and Cosmetics Act (FFDCA). Additionally, programs may encounter logistical problems related to billing under the Health Insurance Portability and Accountability Act (HIPAA), which is not designed to accommodate drug recycling. Despite these hurdles, states have begun to implement drug recycling programs. Although the details of the laws vary among states, most contain strict rules to ensure the safety of the medications. This report provides an overview of the federal laws that may affect state drug recycling programs, as well as examples of these state programs.

RS21404 -- U.S. Occupation of Iraq? Issues Raised by Experiences in Japan and Germany January 30, 2003 Planning, Duration, Force Size. (1) Planning for both occupations, which began asearly as 1942, was marked by sharp disagreements within the Roosevelt administration that continued into the earlyphases of theoccupations. The first of many documents discussing the post-war political configuration of Japan , in particular the status of theemperor and the possibilities and particulars of democratization, was issued in March 1943. The final directives,which provided theparticulars of political reform, were issued by the inter-agency State, War, and Navy departments' coordinatingcommittee (SWNCC)after the Japanese surrender. For Germany , initial moderate plans of the State Department andthe Army were replaced by morepunitive measures that would hold the economy to subsistence level through severe deindustrialization, as reflectedin a January 1945revision of what became the occupation blueprint, the Joint Chief of Staff Document 1067 (JCS 1067). In the end,it was the leadingU.S. official of each occupation who proved a major voice in redirecting early punitive policies. It was presumed that both military occupations would be relatively short. For Japan , the Supreme Commander of the Allied Powers(SCAP) Gen. Douglas MacArthur judged the occupation would last no more than three years. (2) It lasted six years and eight months(August 1945-April 1952). For Germany , the first Military Governor of the U.S. sector, Gen.Dwight D. Eisenhower, anticipated thatthe U.S. military would "provide a garrison, not a government, except for a few weeks." (3) Instead, direct military government lastedfour years, the important first phase of the occupation (May 1945 - May 1949). (Some analysts believe the U.S.military occupationof Germany was prolonged by problems in establishing self-government because of differences with the otheroccupying powers:Great Britain, France, and the Soviet Union, each of which controlled its own sector.) In both cases, a substantial drawdown of U.S. occupation forces occurred after the first year, as there was virtually no armedresistance. In Japan , a peak level of 385,649 was reached by November 1945, but dropped to160,000 by the end of May 1946. In Germany , the 1.6 million troops in Germany in May 1945, dropped to 277,584 in 1946, 119,367in 1947, and 79,370 by 1950. (4) In Japan , most major reforms had been accomplished within four years and six months. In Germany , the U.S. occupation wasphased out in two stages. Germans in the U.S., British, and French sectors jointly gained control of most domesticaffairs in May 1949with the ratification of a new constitution, dubbed the Basic Law, establishing a parliamentary democracy, theFederal Republic ofGermany or 'West Germany." Until 1955, these occupying countries retained emergency powers, a veto over lawsinconsistent withoccupation policy, and authority over such matters as foreign relations, foreign trade, the level of industrialproduction, and militarysecurity. In its zone, the Soviet Union created an authoritarian Soviet-style state, the German Democratic Republicor "EastGermany." (The "West" and "East" entities persisted until reunification in 1990.) Objectives. The objectives of the U.S. occupations of both countries have beensummed up in two lists of four "d"s. In both Japan and Germany , the primary objective was demilitarization . All U.S. plannersagreed that the ability of both countries to wage war in the future should be destroyed. This included destroyingelements of militarypower, including the economic apparatus that fueled war, and punishing war criminals. In Japan ,the next goals were the disarmament and decentralization of the economic apparatus, the latter through thedismantling of the large industrial and bankinggroups. In Germany , they were denazification and deindustrialization . Regarding the fourth "d", democratization , many U.S.policymakers and occupation planners doubted that the Japanese and Germans had the cultural background andpsychologicaldisposition necessary to function in a democracy. After the occupations began, democratization assumed greaterweight in bothexperiences, as those forces who had argued that the inhabitants of those countries were capable of establishingdemocracies gainedcredibility, and as the start of the Cold War fostered the concept of a community of democracies as a counterweightto the SovietUnion. Humanitarian Situation. The occupations commenced amidst a grave humanitarian situation, with large parts of the population homeless, and on subsistence diets or below. In Japan , according to onesource, the war had produced 1.8 million military and civilian casualties, and destroyed 25% of Japan's nationalwealth. Air attacks had destroyed 20% of the country's housing (and a greater amount in some cities), and 30% of its industrialcapacity. (5) In Germany ,between a quarter to a half of housing and transport had been destroyed, leaving some 20 million homeless in theWestern zones. (6) Although the United States provided humanitarian aid at the outset to ward off mass hunger and starvation,occupation authorities andoversight officials soon worried that the U.S. will to continue such relief efforts would flag well before the needfor aid diminished. This trepidation was one consideration reorienting economic policies. In 1949, under pressure from Congress,Military GovernorLucius D. Clay abandoned a central feature of occupation policy in Germany (with which he hadoriginally agreed): the punitivedismantling of what was left of Germany's industrial base to make Germans pay for waging war. (7) Instead, he actively promotedGermany's economic revival. In Japan , the inter-agency SWNCC approved in January 1948 aneconomic recovery program"intended to make Japan self-sufficient through the 'early revival of the Japanese economy'" and encouragingindustrial growth andforeign trade to enable Japan to "make its 'proper contribution to the economic rehabilitation of the worldeconomy.....'" (8) Accomplishments. In both countries, the occupations are credited with the construction of functioning democracies. In Germany , the direct occupation period ended in theWest with the 1949 establishmentof the Federal Republic of Germany, a parliamentary system built on improvements in the constitution andinstitutions of Germany'smajor experience with democracy, the 1919-1933 Weimar Republic. In Japan , the SCAPrevamped the laws, institutions, and moresof the country's "divine right" monarchy. The key reform was a new constitution, largely drafted by the SCAP staff,which transferredsovereignty from the Emperor to the people (while retaining the Emperor in a largely symbolic role) and banneda military, arms, andparticipation in war. It also dismantled the feudalistic structure, creating a more decentralized and representativegovernment throughreforms in the Japanese legislature (the Diet), local governments, and the civil code, among other measures. (9) Other political changesin Japan included the separation of church and state, the enfranchisement of women, the promotion of a free press,and theliberalization of education. Important economic changes, including the dismantling of the large, family-run industrialand bankinggroups, and a wide-scale agrarian reform, are seen as essential to the creation of a functioning democracy, becausethey broke thepower of economic and military elites. Recent assessments of the importance of the occupation governments in establishing these democracies give much greater weight totheir contribution in Japan than in Germany. Indeed, one academic believes that while the United States wasimportant to ademocratic outcome in Japan, "by contrast the strength of democratic forces in West Germany was such that theAmericancontribution appears relatively marginal." (10) Some historians have noted that unique preconditions and circumstances contributed to the success of these occupations, particularlyin Japan. Four crucial points of convergence often cited as important to the success of those occupations inestablishing democracies,raise questions concerning the applicability of these models to a U.S. occupation of Iraq. Although there ispredictably disagreementover their relevance, these issues provide a backdrop for post-Saddam planning. Populations' Acceptance of U.S. Occupations and Democratization Objective Occupation. Occupation by U.S. forces, and democratic reforms, were widely accepted by the JapaneseandGermans themselves, who came to blame their own leaders for the war. Indeed, although historically much iscredited to the UnitedStates for remaking these democracies, many analysts believe that the high degree of cooperation from post-warJapanese and Germanleaders was also crucial to their success. Analysts writing during the occupation of Japan attributed success there "largely...to the wholehearted cooperation of the averageJapanese citizen," (12) a conclusion whichsubsequent research supports. This cooperation has been attributed to several factors,including Emperor Hirohito's plea, before the landing of U.S. forces that the population cooperate fully withoccupation directives. This ensured not only the cooperation of the average citizen, but more importantly of Japan's powerful bureaucracy. Moreover, thegreat majority of Japanese rejected the old political system and military leadership, and were receptive to change.In the early 20thcentury, Western-style democratic political institutions had begun to develop, with increasing influence exercisedby political partiesand greater democratization of parliamentary practices, culminating in 1920 - 1932. (13) In Germany, U.S. occupation officials quickly became convinced that most Germans thoroughly rejected Nazi Fascism, and desiredpolitical change to a successful democracy in line with democratic developments before Adolf Hitler took power. Germany hadexperience with a limited democracy and the rule of law, within an authoritarian culture and political context, duringthe "SecondReich" (or the German Empire) of 1871-1918, even before its experience with democracy during the WeimarRepublic. Manydemocratic leaders of the Weimar Republic had remained in Germany, and were eager to work towards therestoration of democracy. Prospects for democracy may have been further enhanced because the areas of U.S. occupation had more of ademocratic ethos, incontrast to the legacy of Prussian authoritarianism in the Soviet occupation zone. To what extent would a model of Western democracy be acceptable to the Iraqis? Even if Iraqis accepted such a model, mightproblems arise from Iraq's lack of experience with democracy? If such a model is not acceptable to Iraqis, to whatextent do theyshare a common purpose of unifying their country around a political model acceptable to the United States? Giventhe history ofWestern colonialism in the Middle East, U.S. support for Israel, and the drastic effects of current U.S. backedeconomic sanctionsagainst Iraq, would the United States have the nearly unanimous backing of the Iraqi population for an occupation,as it did in Japanand Germany? If not, would a U.N. force enjoy greater support? What difficulties could arise from the lack ofgeneral consent? Homogeneity of Occupied Populations. Although politically diverse, the Japaneseand the German populations as of 1945 were each ethnically homogeneous, and largely without religiousanimosities. To what extent will ethnic and sectarian differences among Iraqis impede effective government by a U.S. occupation force? Giventhose differences, will Iraqis be able to govern themselves within a short period of time? If not, what arrangements(such asco-government, as exists in Afghanistan) might be desirable to promote effective government? What likelihoodis there that such agovernment would succeed? Ability to Manage Their Own Affairs Largely Using Existing Institutions. Although the U.S. military governments held power and issued orders, most of the functions of government werecarried out byJapanese and German institutions. This delegation of functions was the decision of the two dominant figures in theoccupationgovernments, MacArthur in Japan and Clay (14) inGermany. The decision was based in their assessments of the willingness and abilityof Japanese and German citizens to perform these duties, and the scarcity of suitable Americans to do so. In Japan, MacArthur retained and worked through Japan's existing, and centralized, governmental institutions, issuing orders thatwere then carried out by the Japanese government. (15) (He also insisted on autonomy from U.S. agencies to interpret instructions as hesaw fit.) Military government teams, usually of military and civilian personnel, and local liaison offices were alsoestablished at theprefecture (i.e., state) level, and charged with observing, investigating and reporting on compliance. However,according to oneauthor, the "lack of an established policy for local military government activity" resulted in abuses, and a"patchwork of wide localvariations developed." (16) MacArthur entrustedthe Japanese government with demobilizing its forces. In the U.S. sector of Germany, the Office of the Military Government, United States (OMGUS) proceeded immediately to reconstructGerman government institutions to administer occupation laws and policies, even before all U.S. officials wereconvinced thatGermans were ready for it. With the German defeat, the Nazi government collapsed, leaving the allies to replaceofficials andstructures. From the beginning, Clay sought to turn government over to Germans as quickly as possible, starting atthe local level. Insome cases, the OMGUS appointed former German government officials from the pre-1933 period. As early asOctober 1945, Clayissued an order that limited local OMGUS military activities to observing government activities at the city, countyand state level, andreporting problems to higher headquarters. Elections for village officials were held in January 1946, followed bycounty officials inMarch and city officials in May. Clay then pushed for the drafting of state constitutions and establishment of stategovernments. To what extent would Iraqi existing institutions continue to function? What governmental functions would U.S. or other militaryforces have to assume, and for how long? What new institutions would have to be created? To what extent mightgrievances of thosedisplaced from existing institutions, or of those removed and punished for crimes related to participation in theHussein regime, beviewed as legitimate by other Iraqis, and other Middle Eastern governments and populations? To what extent couldsuch sympathiesundermine effective administration by occupation forces? How much autonomy would a U.S. or U.N.administration have to adapt tolocal conditions? International Legitimacy and Support. The U.S. occupations in Japan andGermany were viewed by other countries as morally and legally legitimate, and there was widespread support forthem. Thisinternational consensus meant that U.S. policy could be developed relatively free of competing foreign policyinterests. This wasespecially true in the case of Japan. For Germany, however, the development of economic policy was complicatedby considerationsregarding other European economies. If the United States were to invade Iraq without the full backing of the international community, to whatextent would this lack ofconsensus or agreement undermine the basis of U.S. international legitimacy or support? What U.S. interests wouldbe affected bythe presence of a U.S. occupation force in Iraq? Should the United States expect significant opposition to a U.S.occupation amongthe leaders or populations of neighboring countries? To what extent would its short-term success be judged by itsability to meethumanitarian needs?

This report provides background on the U.S. occupation experiences in Japan andGermany after World War II, and discusses four sets of factors from this period that could be relevant to a U.S.occupation of Iraq. These are: (1) acceptance of U.S. goals, (2) homogeneity of the occupied populations, (3) ability to manage theirown affairs, and (4)international legitimacy and support. This report will not be updated

97-736 -- Victims' Rights Amendment in the 106th Congress: Overview of Suggestions to Amend the Constitution Updated January 12, 2001 Arguments put forward in support of an amendment include assertions that: � The criminal justice system is badly tilted in favor of criminal defendants and against victims' interests and a more appropriate balance should be restored; � The shabby treatment afforded victims has chilled their participation in the criminal justice system to the detriment of all; � Society has an obligation to compensate victims; � Existing statutory and state constitutional provisions are wildly disparate in their coverage, resulting in uneven treatment and harmful confusion throughout thecriminal justice system; and � Existing state and federal law is inadequate and likely to remain inadequate Critics argue to the contrary that: � The criminal justice system is not out of balance. The purpose of a criminal trial is to determine the guilt ofan accused by allowing an impartial jury to weighthe government's evidence that a crime has been committed and that the accused committed it, against any evidenceoffered by the defendant; the interests ofvictims do not fit in the equation; their interests are protected by the right to bring a civil suit against the accused,by court-order restitution if the accused isconvicted, and by victim compensation provisions. � If efficacious, a victims rights amendment would generate considerable uncertainty in the law and flood the federal courts with litigation, could be very costly,and would either jeopardize the rights of the accused (probably in a discriminatory manner) or undermine thegovernment's ability to prosecute. � If the mischief possible through a victims rights amendment is avoided, the proposal becomes purely hortatory; the Constitution is no place for commemorativedecorations. � It is inconsistent with the basic notions of federalism. Each of the states, through its legislatures and electorate, has decided how victims rights should beaccommodated within its criminal justice system. These decisions would be made subservient to a uniform standardthat in all likelihood no jurisdiction wouldhave chosen. S.J.Res. 3 and H.J.Res. 64 would have followed the general format favored in the state constitutions. They would have guaranteedvictims a right to notice, to attend, and/or to be heard at various stages of the criminal justice process. The impact of any victims rights amendment depends upon who is considered a victim for purposes of the amendment. S.J.Res. 3 would havecovered "victim[s] of a crime of violence, as these terms may be defined by law." H.J.Res. 64 would haveapplied to "[e]ach individual who is avictim of a crime for which the defendant can be imprisoned for a period of longer than one year or any other crimethat involves violence." The obviousdifference between the two was that the House Resolution would have covered nonviolent felonies, while the Senateproposal would not. Bail At least in theory, a victim's rights might attach upon commission of the offense. Under the proposals in the 106th and most of the state provisions, the rightsattach upon commencement of "proceedings" involving the crime of which the individual is the victim. The mostsignificant of these early proceedings for thevictim would likely be the bail hearing for the accused. Only a few states grant the victim the right to be heard atthe defendant's bail hearing; a few more permitconsultation with the prosecutor prior to the bail hearing. Most allow victims to attend. And virtually all provideeither that victims should be notified of bailhearings or that victims should be notified of the defendant's release on bail. Under existing federal law, victims of alleged acts of interstate domestic violence or interstate violations of a protective order have a right to be heard at federalbail proceedings concerning any danger posed by the defendant. In other federal cases, victims' prerogatives seemto be limited to the right to confer with theprosecutor and notification of and attendance at all public court proceedings. The proposals in the106th would have given victims the right "to be heard, ifpresent, and to submit a written statement at all such proceedings to determine a conditional release from custody.. . ." and to consideration for their safety "indetermination any conditional release from custody." Plea Bargains Negotiated guilty pleas account for over 90% of the criminal convictions obtained. For the victim, a plea bargain may come as an unpleasant surprise, one thatmay jeopardize the victim's prospects for restitution, one that may result in a sentence the victim finds insufficient,and/or one that changes the legal playing fieldso that the victim has become the principal target of prosecution. Some states' victims rights provisions are limitedto notification of the court's acceptance of aplea bargain. More often, however, the states permit the victim to address the court prior to the acceptance of anegotiated guilty plea or to confer with theprosecutor concerning a plea bargain. S.J.Res. 3 and H.J.Res. 64 would have required that victims beallowed to address the courtbefore a plea bargain could be accepted in any state or federal criminal or juvenile proceeding. Speedy Trial The United States Constitution guarantees those accused of a federal crime a speedy trial; the due process clause of the Fourteenth Amendment makes the rightbinding upon the states, whose constitutions often have a companion provision. The constitutional right isreenforced by statute and rule in the form of speedytrial laws in both the state and federal realms. Until recently, victims had no comparable rights, although theiradvocates contended they had a very real interest inprompt disposition. Most of the states have enacted statutory or constitutional provisions establishing a victim's rightto "prompt" or "timely" disposition of thecase in one form or another. Many have also made efforts to minimize the adverse impact of the delays that dooccur by either providing for employerintercession services and/or by prohibiting employers from penalizing victim/witnesses for attending courtproceedings. And most call for the prompt return of avictim's property, taken for evidentiary purposes, as soon as it is no longer needed. S.J.Res. 3 and H.J.Res. 64 would have entitled victims to consideration of their interests "that any trial be free from unreasonable delay." Courts might well have used the same test for this standard that they have used when testing for unacceptable delayunder the speedy trial and due process clauses:"length of delay, reasons for the delay, defendant's assertion of his right, and prejudice to the defendant." Trial The Sixth Amendment promises the accused a public trial by an impartial jury. It promises victims little. Their status is, at best, no better than that of any othermember of the general public for Sixth Amendment purposes and, in fact, the Constitution screens the accused'sright to an impartial jury trial from the overexuberance of members of the public. Moreover, victims who are also witnesses are even more likely to be barredfrom the courtroom during trial than membersof the general public. About a third of the states now permit victims to attend all court proceedings regardless ofwhether the victim is scheduled to testify;another group allows witnesses who are victims to attend subject to a showing as to why they should be excluded;a few leave the matter in the discretion of thetrial court; and some have maintained the traditional rule -- witnesses are sequestered whether they are victims ornot. S.J.Res. 3 and H.Res. 64 would have invested victims with the right "to notice of, and not to be excluded from, all public proceedingsrelating to the crime," state and federal, juvenile and adult. They made no explicit provision for instances wherethe victim is also a witness. Nor did they indicatehow unavoidable conflicts between the rights they conveyed and the constitutional rights of the accused (at leastas they exist until ratification) were to beresolved. Sentencing The most prevalent of victims' rights among the states is the right to have victim impact information presented to sentencing authorities. There is, however,tremendous diversity of method among the states. Many call for inclusion in a presentencing report prepared forthe court in one way or another, oftensupplemented by a right to make some form of subsequent presentation as federal law permits. Some are specificas to the information that may be included;some permit the victim to address the court directly; others do not. S.J.Res. 3 and H.J.Res. 6 would have afforded victims the right "to be heard . . . and to submit a written statement at all suchproceedings to determine . . . a sentence." They proposal did not address the question of whether relevancy,repetition, or any other limitation might have beenimposed upon exercise of the right. Experience among the states suggests that enforcement may be the stumbling block for any proposed amendment, since there seem to be few palatablealternatives. It is possible to draft the amendment to the United States Constitution so that victims' rightsenforcement is paramount. Legal proceedingsconducted without honoring victims rights would be rendered null; sentencing hearings rescheduled and conductedanew; plea bargains rejected; trials begunagain; unfaithful public servants exposed to civil and criminal liability; inattentive governmental entities madesubject to claims and court orders. A fewproponents suggest that enforcement should be limited to the equitable powers of the courts. This would appear tohave been the intent with respect to S.J.Res. 3 and H.J.Res. 64 which would have denied victims a cause of action or grounds to interrupta criminal trial and otherwiseleaves crafting of enforcement mechanisms to Congress and the state legislatures. S.J.Res. 3 and H.J.Res. 64 would have conferred legislative authority in two ways. First, they would have empowered Congress todefine the class of victims entitled to claim rights under the amendment. Second, they would have vested Congresswith the authority enforce their provisions"through legislation" but subject to the caveat that in doing so Congress craft exceptions to the rights created by theamendment "only when necessary to achieve acompelling interest." Earlier proposals explicitly recognized a greater state legislative role. The question of the states' legislative powers to implement the victims' rights amendment suggests another question. How much, if any, of existing victims rightslaw would survive an amendment? Under the present state of the law, statutory and state constitutional provisions are confined by the United States Constitution, U.S.Const. Art. VI, cl.2. Whentheir advocates have said nothing in them imperils defendant's rights under the United States Constitution, they areright; nothing could. But an amendment to theUnited States Constitution stands on different footing. It amends the Constitution. Its very purpose is to makeconstitutional that which would otherwise not havebeen constitutionally permissible. It may uniformly subordinate defendants' rights to victims' rights. It may requireany conflicting law or constitution precipe,state or federal, to yield. Even in the absence of a conflict, it may preempt the field, sweeping away all laws,ordinances, precedents, and decisions -- compatibleand incompatible alike -- on any matter touching upon the same subject. It may have none or some of theseconsequences depending upon its language and theintent behind its language. Few advocates have explicitly called for a "king-of-the-hill" victims rights amendment, but the thought seems imbedded in the complaint that existing law lacksuniformity. How else can universal symmetry be accomplished but by implementation of a single standard that fillsin where pre-existing law comes up short andshaves off where its generosity exceeds the standard? Proponents of S.J.Res. 3 and H.J.Res. 64 spokeof both the need to establish aminimum victims' rights standard and the need for uniformity. The principles of construction called into play in the case of a conflict between a victims' rights amendment and rights established elsewhere in the Constitutionare similar those used to resolve federal-state conflicts. Intent of the drafters is paramount. The courts will make every effort to reconcile apparent conflicts between constitutional provisions, but in the face of anunavoidable conflict between a right granted by an adopted victims rights amendment and some other portion ofthe Constitution, the most recently adoptedprovision will prevail. The proposals in the 106th Congress were designed to eliminate the unfair treatment that results because the criminal justice "system . . . permits the defendant'sconstitutional rights always to trump the protections given to victims," yet to do so in a manner that would "not denyor infringe any constitutional right of anyperson accused or convicted of a crime." In instances of unavoidable conflict between victim and defendant rights,this seemed to mean the prosecution mustyield. The text of the two hardly defeated this interpretation with the assurance that the "only the victim or thevictim's lawful representative shall have standingto assert the rights" created by the amendment, since the rights of the accused come not from the victims' rightsamendment but from the Sixth Amendment orsome other source within the Constitution.

Thirty-three states have added a victims rights amendment to their state constitutions. Both the House and SenateJudiciary Committees held hearings on similar proposals in the 106th Congress to amend the UnitedStates Constitution (S.J.Res. 3 introduced bySenator Kyl for himself and Senator Feinstein and H.J.Res. 64 introduced by Representative Chabot). TheSenate Committee initially reported outan amended version of S.J.Res. 3 without a written report, but issued a report prior to floor consideration ofthe reported proposal, S.Rept. 106-254. Neither S.J.Res. 3 nor H.J.Res. 64 were ever brought to a vote on the floor. This is an overview ofthose proposals and is an abbreviatedform of Victims' Rights Amendment: Proposals to Amend the United States Constitution in the 106thCongress, CRS Report RL30525(pdf). Authorities identifiedthere have been omitted here in the interests of brevity

Relatively high default and foreclosure rates in the housing market have led some to question whether borrowers were fully informed about the terms of their mortgage loans. There has been concern that mortgage disclosure forms are confusing and not easily understood by borrowers. It has been argued that transparent mortgage terms could enhance consumer shopping and discourage predatory, discriminatory, and fraudulent lending practices. Lending practices that involve hidden costs may result in a payment shock to a borrower, possibly leading to financial distress or even foreclosure. The issue of adequate disclosure of mortgage terms is longstanding. The Truth in Lending Act (TILA) of 1968, which was previously implemented by the Federal Reserve Board via Regulation Z, requires lenders to disclose the cost of credit and repayment terms of mortgage loans before borrowers enter into any transactions. The TILA Disclosure Statement conveys information about the credit costs and terms of the transaction. The TILA Disclosure Statement lists the annual percentage rate (APR), an interest rate calculation that incorporates both the loan rate and fees. The statement also discloses finance charges, the amount financed, the total number of the payments, whether the interest rate on the mortgage loan can change, and whether the borrower has the option to refinance the loan. The Real Estate Settlement Procedures Act (RESPA) of 1974 is another element of the consumer disclosure regime. RESPA requires standardized disclosures about the settlement or closing costs, which are costs associated with the acquisition of residential mortgages. Examples of such costs include loan origination fees or points, credit report fees, property appraisal fees, mortgage insurance fees, title insurance fees, home and flood insurance fees, recording fees, attorney fees, and escrow account deposits. In other words, the mortgage loan rate and fees are disclosed in separate calculations rather than in one calculation. In addition, RESPA, which was implemented by the Department of Housing and Urban Development (HUD), includes the following provisions: (1) providers of settlement services are required to provide a good faith estimate (GFE) of the settlement service costs borrowers should expect at the closing of their mortgage loans; (2) a list of the actual closing costs must be provided to borrowers at the time of closing, which are typically listed on the HUD-1 settlement statement; and (3) RESPA prohibits "referral fees" or "kickbacks" among settlement service providers to prevent settlement fees from increasing unnecessarily. The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act; P.L. 111-203 ) transferred general rulemaking authority for various provisions of TILA and RESPA to a new Consumer Financial Protection Bureau (CFPB) effective July 21, 2011. Lenders currently present borrowers with both TILA and RESPA disclosures, but the Dodd-Frank Act has directed the CFPB to create a single disclosure form that satisfies both disclosure requirements. The CFPB must issue a proposed rule of the new Loan Estimate form within one year of its July 21, 2011 transfer date. The CFPB released two initial Loan Estimate prototypes in May 2011 and has proposed several rounds of updated prototypes since then. This report reviews current efforts to regulate the reporting of pertinent loan information to consumers, including actions taken by the CFPB. As previously stated, TILA requires mortgage lenders to present borrowers with a disclosure statement that conveys information about the credit costs and terms of the transaction in one APR calculation expressed as a percentage. TILA was amended in 1980 to require the Federal Reserve to publish APR disclosure forms. On November 17, 2008, HUD made changes to the RESPA component of the mortgage disclosure process that it supervises. Key modifications are discussed below. HUD's final rule developed a standardized good faith estimate form for use in the initial stages of obtaining mortgages. The GFE included changes intended to help consumers better understand and locate relevant information about their mortgage products. For example, the GFE conveys information about the mortgage terms, whether the interest rate can rise, whether the overall loan balance can rise, whether the loan has a prepayment penalty, whether the loan has a balloon payment, and whether the quoted monthly payment includes a monthly escrow payment for taxes. All of this information about the loan appears on the first page of the GFE. In addition to facilitating comparison shopping, the HUD GFE form also results in reliable GFEs in the sense that some of the estimated costs are required to not change substantially by the time consumers are ready to close on their loans. Shopping for the best deal or the most affordable loan would be pointless if the costs were to change when borrowers arrived at closing. Consequently, page three of the GFE lists charges that cannot increase, charges that are allowed to increase up to 10%, and charges that may change at settlement. For specific charges that should not change or exceed the 10% limit, a borrower has the option to withdraw the application. This makes it difficult for lenders to generate "costs" or fees that could not be easily justified. A separate GFE is required for each loan product offered to the borrower. For example, a borrower may wish to compare a traditional fixed rate mortgage (FRM) loan with an adjustable rate mortgage (ARM) loan. Both mortgage products must have separate GFEs to ensure that the information provided is unique to each product. HUD argued that these changes to the GFE would reduce confusion about loan and settlement costs, help the borrower better determine product affordability, and facilitate comparison shopping. HUD distinguished two stages in the overall mortgage seeking process. The consumer receives a GFE in stage 1, which occurs prior to proceeding with the official mortgage application in stage 2. In the first stage, the lender is not expected to have performed any underwriting, and the GFE need only consist of information obtained from the borrower without any verification of borrower statements. Final underwriting is expected to begin in stage 2 after the borrower has expressed a willingness to proceed with an official mortgage application. The GFE becomes binding only if the underwriting process confirms borrower statements and loan qualifications. If the underwriting process reveals that the borrower is unable to qualify for the specific loan product, then the lender may reject the borrower or propose a new GFE for another loan product in which the borrower is more likely to qualify. The TILA Disclosure Statement also has a two-stage process similar to the GFE. If the initial APR on the disclosure changes by more than a certain amount after the loan underwriting is performed, the lender must provide a corrected Disclosure Statement at least three days before the loan can be finalized. If a term other than the APR changes after underwriting, then the corrected disclosure must be presented to the borrower at the time the loan is finalized. For a majority of prime or high-credit quality borrowers, the final loan rates initially stated on the GFE forms are likely to become the actual ones after underwriting. Lenders typically advertise the interest rates that prime borrowers are likely to be charged, and high-credit quality borrowers are arguably already able to shop for loans. Subprime or high-risk borrowers, however, encounter difficulties shopping for loan rates and may continue to do so under this system. Lenders typically charge higher rates to riskier borrowers to compensate for the additional risk, and such rates are typically determined after underwriting has occurred. Hence, low-credit quality borrowers may be less likely to obtain estimates of loan rates prior to final underwriting that would not change afterwards. Assuming no substantial shifts in the current proportion of prime relative to subprime borrowers, or that the share of prime borrowers diminishes as a result of further borrower risk gradations, underwriting at the GFE stage might not be necessary for the vast majority of consumers to obtain fairly reliable pricing information of mortgage products. A standardized HUD-1 settlement statement is required at all settlements or closings involving mortgage loans. The HUD-1 lists all settlement charges paid at closing, the seller's net proceeds, and the buyer's net payment. HUD modified the HUD-1 form to make it easier for borrowers to trace the estimated costs on the GFE to the actual charges listed on the HUD-1 form. The itemized charges listed on the HUD-1 form include references to the same charges originally listed on the GFE. With these references, it may become more apparent to borrowers what charges remained the same or changed from the estimation stage to the closing stage. Prior to implementation of the standardized GFE, a Federal Trade Commission (FTC) study tested 819 consumers to document their understanding of mortgage cost disclosures and loan terms, as well as their ability to avoid deceptive lending practices. The authors found that both prime and subprime borrowers had difficulty understanding important mortgage costs after viewing mortgage cost disclosures. Some borrowers had difficulty identifying the APR of the loan and loan amounts. Many borrowers did not understand why the interest rate and APR of a loan would differ. In addition, borrowers had trouble understanding loan terms for the more complicated mortgage products, such as those with optional credit insurance, interest-only payments, balloon payments, and prepayment penalties. Many borrowers were unable to determine whether balloon payments, prepayment penalties, or up-front loan charges were part of the loan. The inability to understand a loan offer makes a borrower more vulnerable to predatory lending. Predatory loans are often characterized by high fees or interest rates and other provisions that may not benefit the borrower. Given that one area particularly susceptible to predatory action is the calculation of lender compensation, HUD's revised GFE form includes new disclosure methods so borrowers can understand the fees they are charged to obtain their mortgage loans. Loan charges may be collected either through points (up-front fees), or via the interest rate mechanism, which is referred to as the yield spread premium (YSP), or some combination of these two pricing mechanisms. Page two of the revised standardized GFE form discloses the computation of the total origination costs. In addition, if borrowers realize that mortgage loan origination costs may be collected by some combination of up-front fees and YSP, then they may also realize that it is possible to choose between paying higher up-front fees for a lower interest rate or lower up-front fees for a higher interest rate. Recognition of this trade-off may help borrowers avoid being charged both higher rates and higher fees. The GFE includes a trade-off table on page three to facilitate the understanding of the trade-off between interest rates and points. The trade-off table discloses how a loan with the same principal face value and a lower interest rate results in higher up-front settlement costs; it also discloses how the same loan with a higher interest rate results in lower up-front settlement costs. Although the trade-off table was found to benefit consumers, HUD's final rule required only the leftmost column of the table to be filled out. The decision to allow loan originators the option to fill out the remaining columns was related to concerns regarding the cost burden and time to calculate comparable loan costs information. In addition, the trade-off table may still be difficult to interpret for loans with adjustable interest rates, which are likely to change over the life of the loan and distort the inverse relationship between the interest rate and up-front fees. Some borrowers, however, may be inclined to request that loan originators fill out the table completely, which would facilitate HUD's policy objectives to achieve transparency. As required by the Dodd-Frank Act, the CFPB has proposed various prototypes of a standardized Loan Estimate form to combine the TILA Disclosure Statement and HUD's GFE into a single document. The Dodd-Frank Act directed the CFPB to issue a proposed rule of the new Loan Estimate form within one year of its July 21, 2011 transfer date. The CFPB stated its plans to perform five rounds of testing in six different cities before the final rule is proposed. In addition to consumer testing, the CFPB convened a Small Business Review Panel to solicit feedback on its prototype. The current prototype, Tupelo, is the most recent form available on the CFPB website and has been developed after at least five rounds of testing. Tupelo has three pages with the first page containing three sections. The first section presents the loan amount; the interest rate and whether it can change; the monthly loan payment; and whether a prepayment penalty or a balloon payment exists. The second section discloses the projected monthly payments over various time periods of the loan. Estimates of the borrower's monthly payment also includes estimated property taxes, insurance, and assessments. This section also shows whether an escrow account exists and how much the borrower should expect to pay each month. The last section on page one provides the estimated amount needed to close. The second page of the Tupelo prototype uses the example of a loan for $211,000 with $6,151 in closing costs for the sake of illustrating a completed form. The prototype has five sections. The first two sections itemize the various expenses associated with closing. The third section calculates the cash needed to close by summing the settlement fees, settlement costs, down payment, and other costs. Next, a table provides the potential borrower with information on the monthly payments, such as whether there are any interest-only payments and what the maximum payment could be. Finally, a second table describes whether the mortgage interest rate is adjustable and how it could potentially change. The third page of the Tupelo prototype contains three additional sections. The first section allows borrowers to compare the terms of other loans offered by other loan originators. The section lists the amount that a borrower will have paid in total over the first five years of the loan and how much would go to paying down principal. It also lists the APR as well as the total amount of interest paid over the loan term as a percentage of the loan. The next section provides brief information about other aspects (e.g., appraisal, homeowner's insurance, late payments, and servicing). Should the borrower decide to proceed with the mortgage origination process, the final section provides a space for the applicant to sign to confirm that the form was received. The CFPB has also developed a prototype settlement disclosure, which consolidates the HUD-1 Settlement Statement and the final TILA disclosure.

High default and foreclosure rates in the housing market have resulted in questions as to whether borrowers were fully informed about the terms of their mortgage loans. A lack of transparency with respect to loan terms and settlement costs can make it difficult for consumers to make well-informed decisions when choosing mortgage products. In addition, inadequate disclosures can make some borrowers more vulnerable to predatory lending or discriminatory practices. The adequate disclosure of mortgage terms is a longstanding issue that has prompted several congressional actions. For example, the Truth in Lending Act (TILA) of 1968 and the Real Estate Settlement Procedures Act (RESPA) of 1974 were enacted to require disclosures of credit costs and terms to borrowers. The Economic Growth and Regulatory Paperwork Reduction Act of 1996 (P.L. 104-208) directed the Federal Reserve Board and the Department of Housing and Urban Development (HUD) to propose a single form that satisfied the requirements of RESPA and TILA. However, the Federal Reserve Board and HUD concluded that regulatory changes would not be sufficient and that further statutory changes would be required for the forms to be consolidated. More recently, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act; P.L. 111-203), which established the Consumer Financial Protection Bureau (CFPB), mandated the new agency revisit disclosure stipulations for mortgage loans. In addition, the Dodd-Frank Act requires the CFPB to consolidate mandatory TILA and RESPA disclosures into one Loan Estimate form. The 112th Congress has been closely monitoring the subsequent rulemaking associated with the Dodd-Frank Act, as well as the performance and effectiveness of the CFPB. Consequently, this report examines one of the first major actions undertaken by the new agency. Specifically, efforts by the CFPB to create an effective mortgage disclosure form for borrowers are discussed. This report will be updated as warranted.

Programs under the Agricultural Trade Development and Assistance Act of 1954, referred to as P.L. 480, historically have been the main vehicles of U.S. international food aid. Title II of P.L. 480, administered by the U.S. Agency for International Development (USAID), is the largest U.S. international food aid program. Title II provides humanitarian donations of U.S. agricultural commodities to respond to emergency food needs or to be used in development projects. Funds available to Title II of P.L. 480 from both regular and supplemental appropriations have averaged $2 billion annually since enactment of the 2002 farm bill (2002-2007). Over time, however, other, smaller food aid programs, administered by the U.S. Department of Agriculture (USDA), have been authorized by Congress—Food for Progress in 1985, the Bill Emerson Humanitarian Trust in 1998, and the McGovern-Dole International School Feeding and Child Nutrition Program in 2003. For USDA-administered programs, the annual average funding over the 2002 farm bill period has been $356 million. Most of the farm bill food aid debate focused on P.L. 480 Title II commodity donations. The 2008 farm bill changes the name of the underlying P.L. 480 legislation from Agricultural Trade Development and Assistance Act to Food for Peace Act and deletes export market development as one of the objectives of the programs. This modification of objectives is intended to reflect the approach—de-emphasis of export market development for U.S. agricultural commodities and more emphasis on promoting food security—taken in operating the program in recent years. Issues addressed included policy objectives, funding levels, availability of food aid resources for non-emergency (development) projects, and using local/regional commodity purchases to respond more efficiently and effectively to food crises, among others. The 2008 farm bill amends the purposes of the Title II program to clarify that food deficits to be addressed include those resulting from manmade and natural disasters. Recognition that food deficits can be manmade brings the U.S. definition of disaster more in line with the definition used by United Nations agencies such as the World Food Program. The new farm bill adds promotion of food security and support of sound environmental practices to the objectives of Title II commodity donations, and requests that the administrator of USAID brief relevant congressional committees before responding to disasters that result mostly from poorly devised or discriminatory governmental policies. The new farm law also includes a Sense of Congress declaration that in international negotiations the President shall seek commitments of higher levels of food aid from other donors; ensure that food aid implementing organizations be eligible to receive food aid resources based on their own needs assessments; and ensure that options for providing food aid shall not be subject to limitation, on condition that the provision of the food aid is based on needs assessments, avoids disincentive effects to local production and marketing, and is provided in a manner that avoids disincentives to local production and marketing and with minimal potential to disrupt commercial markets. This declaration reflects a concern in Congress with the issue of how Doha Round multilateral trade negotiations on food aid could affect U.S. food aid policy and programs. The 2008 farm bill extends authorization of P.L. 480 programs through FY2012 and sets the annual authorization level for Title II at $2.5 billion. This level of funding would be $500 million more annually than has been provided for Title II under the 2002 farm bill each fiscal year through a combination of regular and supplemental appropriations. But as this authorization is discretionary, it will be up to appropriations bills to set the amount of annual Title II funding. With a view to providing more cash assistance to organizations—private voluntary organizations (PVOs), cooperatives, intergovernmental organizations—that implement Title II food aid programs, the farm bill increases the range of funds available for administrative and distributional expenses to between 7.5% and 13% of funds available each year to the program (appropriations, carry-over, and reimbursements) . (The range of available Title II funds for these purposes under the 2002 farm bill was 5% to 10%). Additionally, the 2008 farm bill provides $4.5 million for FY2009-FY2011 to study and improve food aid quality (e.g., eliminate spoilage). The new farm bill extends the requirement that the Administrator of USAID make a minimum level of 2.5 million metric tons (MMT) of commodities available each fiscal year through 2012 for distribution via Title II. Of that minimum, not less than 1.875 MMT is to be made available for non-emergency (development) projects. This mandated volume of commodities for development food aid has rarely been met. The requirement can be waived, and frequently has been, if the Administrator of USAID determines that such quantities of commodities cannot be used effectively or in order to meet an emergency food security crisis. In recent years, more Title II funds have been allocated to emergency relief than to non-emergency (development) projects. In FY2007, for example, USAID allocated $866.3 million to emergency food aid and $348.4 million to development food aid. The Administration has expressed concerns about the adequacy of food aid resources to respond to emergencies, while food aid organizations indicate concerns about the availability of food aid for use in development projects. The 2008 farm bill provides for a "safe box" for funding of non-emergency, development assistance projects under Title II. The argument in favor of the safe box is that it would provide assurances to the implementing organizations (PVOs, coops, intergovernmental organizations) of a given level of funds with which to carry out development projects. The Administration's principal objection to the safe box is that it will deprive the USAID Administrator of the flexibility needed to respond to emergency food needs. The new farm bill provides a safe box funding level beginning at $375 million in FY2009, ending in FY2012 at $450 million. The mandated funding level can be waived if three criteria are satisfied: (1) the President determines that an extraordinary food emergency exists; (2) resources from the Bill Emerson Humanitarian Trust (see below) have been exhausted, and (3) the President has submitted a request for additional appropriations to Congress equal to the reduction in safe box and Emerson Trust levels. The 2008 farm bill includes a scaled-down version of the Administration's only international food aid proposal for legislative authority to use up to $300 million of appropriated P.L. 480 Title II funds for local or regional purchase and distribution of food to assist people threatened by a food security crisis. The farm bill provides that the pilot project be conducted by the Secretary of Agriculture with a total of $60 million in mandatory funding (not P.L. 480 appropriations) during FY2009 and FY2012. The pilot project would entail a study of experiences with local/regional purchase followed by field-based projects that would purchase food commodities locally or regionally. The field-based projects would be funded with grants to PVOs, cooperatives, and intergovernmental organizations, such as the World Food Program. All of the field-based projects would be evaluated by an independent third party beginning in 2011; the Secretary of Agriculture would submit a report to Congress on the pilot project four years after the enactment of the bill. The new farm bill extends to 2012 the authority for the Food Aid Consultative Group (FACG), which advises the USAID Administrator on food aid policy and regulations. It requires that a representative of the maritime transportation sector be included in the Group. The 2008 farm bill reauthorizes the Micronutrient Fortification Program in which grains and other food aid commodities may be fortified with such micronutrients as vitamin A, iodine, iron, and folic acid. It adds new legislative authority to assess and apply technologies and systems to improve food aid. The farm bill also eliminates limitations on the number of countries in which this program can be implemented. The farm bill authorizes the use of up to $22 million annually to be used for the monitoring and assessment of non-emergency (development) food aid programs. No more than $8 million of these funds may be used for the Famine Early Warning System Network (FEWS-NET), but only if at least $8 million is provided for FEWS-NET from accounts appropriated under the Foreign Assistance Act of 1961. Up to $2.5 million of the funds can be used to upgrade the information technology systems used to monitor and assess the effectiveness of food aid programs. This provision is a response to criticism that monitoring of such programs by USAID has been inadequate due to such factors as limited staff, competitive priorities, and legal restrictions. The USAID Administrator can use these funds to employ contractors as non-emergency food aid monitors. The farm bill increases funding available annually (from Title II funds) from $3 million to $8 million for stockpiling and rapid transportation, delivery, and distribution of shelf-stable, prepackaged foods. Shelf-stable foods are developed under a cost-sharing arrangement that gives preference to organizations that provide additional funds for developing these products. The new bill also reauthorizes prepositioning of commodities overseas and increases the funding for prepositioning to $10 million annually from $2 million annually. USAID maintains that prepositioning (currently at two sites, New Orleans and Dubai, United Arab Emirates) enables it to respond more rapidly to emergency food needs. Critics say, however, that the cost effectiveness of prepositioning has not been evaluated. The 2008 farm bill reauthorizes the Farmer-to-Farmer program of voluntary technical assistance in agriculture funded with a portion of P.L. 480 funds. The bill provides an annual floor level of funding for the program of $10 million and extends it through 2012. It also increases the authorization of annual appropriations for specific regions (sub-Saharan Africa and the Caribbean Basin) from $10 million to $15 million. This title of P.L. 480 authorizes provision of long-term, low interest loans to developing countries for the purchase of U.S. agricultural commodities. The new farm bill makes some changes in the program, which has not received an appropriation since 2006 to reflect a food security rather than a market development emphasis of U.S. food aid. Thus the bill strikes references in Title I to recipient countries becoming commercial markets for U.S. agricultural products and the requirement that organizations seeking funding under this title prepare and submit agricultural market development plans. The bill gives Title I of P.L. 480, previously referred to as Trade and Development Assistance, a new name, Economic Assistance and Food Security. The Food for Progress Program (FFP) provides commodities to developing countries that have made commitments to expand free enterprise in their agricultural economies. The 2002 farm bill required that a minimum of 400,000 MT be provided under the FFP program. However, not more than $40 million of Commodity Credit Corporation (CCC) funds may be used to finance transportation of the commodities. This amount effectively caps the volume of commodities that can be shipped under the program. (In FY2007, for example, 342,000 MT were shipped under FFP.) The 2008 farm bill conference agreement extends the program without change through 2012, with the requirement that the Secretary of Agriculture establish a project in Malawi under the FFP. The McGovern-Dole food aid program provides commodities and financial and technical assistance to carry out preschool and school food for education programs in developing countries. The program is widely viewed as a model food aid program because of the flexibility with which it provides program components. By executive order of the President, the McGovern-Dole program is administered by the Secretary of Agriculture. The main issues in congressional debate about the future of the program were the manner and level of funding. Some argued for changing the funding from discretionary (as in current law) to mandatory and for ramping up funding to $300 million by 2012. Others proposed maintaining discretionary funding for the program with a substantial increase. The 2008 farm bill reauthorizes the program through 2012 and establishes the U.S. Department of Agriculture as the permanent home for the program. The new law maintains funding for McGovern-Dole on a discretionary basis without an increase, but does authorize $84 million in mandatory money for the program in FY2009, to be available until expended. The Bill Emerson Humanitarian Trust (BEHT) is a reserve of commodities and cash that is used to meet unanticipated food aid needs or to meet food aid commitments when U.S. domestic supplies are short. The BEHT can hold up to 4 MMT of grains (wheat, rice, corn, sorghum) in any combination, but the only commodity ever held has been wheat. USDA has recently sold the remaining wheat in the trust (about 915,000 MT) so that currently the BEHT holds only cash—about $294 million. The cash would be used, according to USDA, when USAID determines it is needed for emergency food aid. The 2008 farm bill reauthorizes the BEHT through FY2012. It removes the 4 million ton cap on commodities that can be held in the trust, and allows the Secretary to invest the funds from the trust in low-risk, short-term securities or instruments so as to maximize its value. The new law replaces the word "replenish" with the word "reimburse" throughout the language to reinforce the notion that resources of the BEHT may be held in cash as well as commodities.

Provision of U.S. agricultural commodities for emergency relief and economic development is the United States' major response to food security problems in developing countries. Title III in the omnibus farm bill enacted in June 2008, the Food, Conservation, and Energy Act of 2008 (P.L. 110-246, H.R. 6124), reauthorizes and makes a number of changes in U.S. international food aid programs. Farm bill debate over U.S. food aid programs focused generally on how to make delivery of food aid more efficient and more effective. While most of the debate focused on P.L. 480 Title II, the largest food aid program, the farm bill trade title also reauthorizes and modifies other, smaller U.S. food aid programs. One of the most contentious issues was that of using appropriated P.L. 480 funds to purchase commodities overseas, rather than U.S. commodities, to respond to emergency food needs. The Bush Administration had asked for this authority in its farm bill proposals, but many, though not all, of the private voluntary organizations and cooperatives that use U.S. commodities for development projects instead argued for a pilot project for local or regional purchases of commodities.

Alternative fuel and advanced technology vehicles face significant barriers to wider acceptance as passenger and work vehicles. Alternative fuel vehicles include vehicles powered by nonpetroleum fuels such as natural gas, electricity, or alcohol fuels. Advanced technology vehicles include hybrid vehicles, which combine a gasoline engine with an electric motor system to boost efficiency. Often, these vehicles are more expensive than their conventional counterparts. Further, fueling the vehicles is often inconvenient because the number of refueling stations for alternative vehicles is negligible compared with the number of gasoline stations nationwide; in some regions, the infrastructure is nonexistent. However, many of these vehicles perform more efficiently and are better for the environment than conventional vehicles. There has been significant interest in promoting these vehicles as a response to environmental and energy security concerns. The Energy Policy Act of 1992 ( P.L. 102-486 , §1913) established individual and business tax incentives for the purchase of alternative fuel and advanced technology vehicles and for the installation of alternative fuel infrastructure. The Energy Policy Act of 2005 ( P.L. 109-58 ) expands these existing tax incentives and creates new ones. Incentives existing prior to P.L. 109-58 include the Electric Vehicle Tax Credit; the Clean Fuel Vehicle Tax Deduction; and tax deduction for the installation of alternative fuel infrastructure. For 2005, a federal tax credit is available worth 10% of the purchase price of an electric vehicle, up to a maximum of $4,000 (26 U.S.C. 30). The credit, which was not extended by the Energy Policy Act of 2005, will be reduced to a maximum of $1,000 in 2006 and will be phased out completely after 2006. For the purchase of alternative fuel vehicles, as well as hybrid electric vehicles, a Clean Fuel Vehicle Tax Deduction (26 U.S.C. 179A) is available. The amount of the deduction is based on the weight of the vehicle. Vehicles under 10,000 pounds gross vehicle weight (i.e., cars and light trucks) qualify for a $2,000 deduction in 2005; those between 10,000 and 26,000 pounds qualify for a $5,000 deduction. Vehicles above 26,000 pounds qualify for a $50,000 deduction. The Energy Policy Act of 2005 terminates this deduction after December 31, 2005, and replaces it with a tax credit (see below). Prior to 2002, hybrid electric vehicles were not considered "clean-fuel vehicles" because the primary fuel for the vehicles is gasoline. However, in May 2002, the Internal Revenue Service (IRS) announced that taxpayers can claim the deduction for qualified hybrids. As of December 2005, eight hybrid models are eligible for the deduction. Businesses that install alternative fuel refueling infrastructure can claim a tax deduction of up to $100,000 (26 U.S.C. 179A). The Energy Policy Act of 2005 eliminates this deduction at the end of 2005 and replaces it with a tax credit (see below). The Energy Policy Act of 2005 expanded and extended the existing tax incentives for nonconventional vehicles. These new incentives are similar to those proposed in the Clean Efficient Automobiles Resulting from Advanced Car Technologies Act (CLEAR ACT, S. 971 ) and the Volume Enhancing Hardware Incentives for Consumer Lowered Expenses Technology Act (VEHICLE Technology Act, H.R. 626 ), as well as legislation discussed in the 108 th Congress. Among other provisions, Sections 1341 and 1342 of the Energy Policy Act of 2005 contain several tax incentives for alternative fuel and advanced technology vehicles. For example, the act replaces the existing clean-fuel vehicle tax deduction with a new tax credit for hybrid vehicles; creates a tax credit for the purchase of lean-burn passenger vehicles; creates a new tax credit for the purchase of fuel-cell vehicles; replaces the existing clean-fuel vehicle tax deduction with an alternative fuel vehicle tax credit; and replaces the existing deduction for the installation of refueling infrastructure with a tax credit. Each of these credits is discussed below; Table 4 summarizes each one. Under the Energy Policy Act of 2005, the existing clean-fuel vehicle deduction for hybrid electric vehicles is replaced with a tax credit after 2005. The amount of the credit is based on several factors. For passenger vehicles, these factors are the fuel economy increase and the expected lifetime fuel savings when compared with a conventional vehicle of comparable weight. To qualify for the credit, a hybrid vehicle must meet certain emissions standards and technical specifications. For heavy-duty vehicles (more than 8,500 pounds), the credit is based on the fuel economy relative to a comparable vehicle, as well as the incremental cost of the hybrid vehicle above the cost of the conventional vehicle. The range of potential credits for each vehicle weight are shown in Table 1 . The hybrid vehicle credit is scheduled to expire at the end of 2009. The American Council for an Energy-Efficient Economy estimates that 2006 tax credits for hybrid passenger vehicles will range from $0 (Honda Insight) to $3,150 (Toyota Prius). However, the IRS has not yet announced the value of the credits for 2006. The Energy Policy Act of 2005 established a tax credit for the purchase of passenger vehicles with "lean-burn" engines. For the most part, diesel-powered vehicles that meet certain emissions and fuel economy standards would qualify for the tax credit, which is structured like the hybrid tax credit and ranges from $400 to $3,400, based on fuel economy and fuel savings. The credit is scheduled to expire at the end of 2010. However, no lean-burn passenger vehicles are available that meet the emission standard. Consequently, no vehicles on the market qualify for the credit, although many observers expect automakers to look for ways to reduce the emissions of such vehicles in future years so that the vehicles can qualify. The Energy Policy Act of 2005 provides a tax credit for the purchase of fuel-cell vehicles. The credit increases with gross vehicle weight, as shown in Table 1 . Passenger vehicles that achieve at least 50% better fuel economy than a comparable conventional vehicle also qualify for an additional tax credit of between $1,000 and $4,000, depending on overall fuel economy. The credit expires at the end of calendar year 2014. However, because of technical and cost concerns, no fuel-cell vehicles are commercially available, and the development of a mass-market fuel-cell vehicle in the near future seems unlikely. The Energy Policy Act of 2005 replaces the existing clean-fuel vehicle tax deduction with a credit for the purchase of a new alternative fuel vehicle (AFV). The new credit is equal to a percentage of the incremental cost of the AFV, subject to certain maximum dollar amounts. The incremental cost is the difference between the higher cost of the AFV and its conventional counterpart. Under the act, the applicable percentage is 50% of the incremental cost plus an additional 30% if the vehicle meets certain emissions requirements. The maximum credit is based on the weight of the vehicle, as shown in Table 3 . The credit expires at the end of 2010. To qualify for the credit, the vehicle is required to be a "dedicated" AFV, meaning that it must not be capable of operating on conventional fuel. This provision is a response to criticisms of previous AFV policies that included "dual-fuel" vehicles. In many cases, dual-fuel vehicles operate solely on gasoline. Because some alternative fuels must be blended with a small amount of gasoline (e.g., ethanol, methanol), vehicles using these fuels qualify for a prorated tax credit. The Energy Policy Act of 2005 replaces the existing deduction for the installation of alternative fuel infrastructure with a tax credit. The credit is equal to 30% of the purchase or installation cost of the refueling property, subject to a maximum dollar amount. For retail property, the maximum credit is $30,000. For residential property, the maximum is $1,000. The credit expires after 2014 for hydrogen infrastructure; the credit for all other fuels expires after 2009.

Alternative fuel and advanced technology vehicles face significant market barriers, such as high purchase price and limited availability of refueling infrastructure. The Energy Policy Act of 2005 (P.L. 109-58) expands and establishes tax incentives that encourage the purchase of these vehicles and the development of infrastructure needed to support them. Among the new provisions are tax credits for the purchase of hybrid vehicles (replacing an existing tax deduction), tax credits for the purchase of advanced diesel vehicles (although it is unclear whether any current vehicles will qualify), and tax credits to expand refueling infrastructure. This report discusses current federal tax incentives for alternative fuel and advanced technology vehicles. It also outlines how the Energy Policy Act of 2005 changes those incentives. This report will be updated as events warrant.

The IGs' four principal responsibilities are (1) conducting and supervising audits and investigations relating to the programs and operations of the agency; (2) providing leadership and coordination and recommending policies to promote the economy, efficiency, and effectiveness of these; (3) preventing and detecting waste, fraud, and abuse in these; and (4) keeping the agency head and Congress fully and currently informed about problems, deficiencies, and recommended corrective action. To carry out these purposes, IGs have been granted broad authority to: conduct audits and investigations; access directly all records and information of the agency; request assistance from other federal, state, and local government agencies; subpoena information and documents; administer oaths when taking testimony; hire staff and manage their own resources; and receive and respond to complaints from agency employees, whose confidentiality is to be protected. In addition, the Homeland Security Act of 2002 gave law enforcement powers to criminal investigators in offices headed by presidential appointees. IGs, moreover, implement the cash incentive award program in their agencies for employee disclosures of waste, fraud, and abuse (5 U.S.C. 4511). IGs have reporting obligations regarding their findings, conclusions, and recommendations. These include reporting: (1) suspected violations of federal criminal law directly and expeditiously to the Attorney General; (2) semiannually to the agency head, who must submit the IG report (along with his or her comments) to Congress within 30 days; and (3) "particularly serious or flagrant problems" immediately to the agency head, who must submit the IG report (with comments) to Congress within seven days. The Central Intelligence Agency (CIA) IG must also report to the Intelligence Committees if the Director or Acting Director is the focus of an investigation or audit. By means of these reports and "otherwise" (e.g., testimony at hearings), IGs are to keep the agency head and Congress fully and currently informed. In addition to having their own powers (e.g., to hire staff and issue subpoenas), IG independence is reinforced through protection of their budgets (in the larger establishments), qualifications for their appointment, prohibitions on interference with their activities and operations (with a few exceptions), and fixing the priorities and projects for their offices without outside direction. An exception to the IGs' rule occurs when a review is ordered in statute, although inspectors general, at their own discretion, may conduct reviews requested by the President, agency heads, other IGs, or congressional offices. Other provisions are designed to protect the IGs' independence and ensure their neutrality. For instance, IGs are specifically prohibited from taking corrective action themselves. Along with this, the Inspector General Act prohibits the transfer of "program operating responsibilities" to an IG. The rationale for both is that it would be difficult, if not impossible, for IGs to audit or investigate programs and operations impartially and objectively if they were directly involved in making changes in them or carrying them out. IGs serve under the "general supervision" of the agency head, reporting exclusively to the head or to the officer next in rank if such authority is delegated. With but a few specified exceptions, neither the agency head nor the officer next in line "shall prevent or prohibit the Inspector General from initiating, carrying out, or completing any audit or investigation, or from issuing any subpoena...." Under the IG Act, the heads of only six agencies—the Departments of Defense, Homeland Security, Justice, and the Treasury, plus the U.S. Postal Service (USPS) and Federal Reserve Board—may prevent the IG from initiating, carrying out, or completing an audit or investigation, or issuing a subpoena, and then only for specified reasons: to protect national security interests or ongoing criminal investigations, among others. When exercising this power, the head must explain such action within 30 days to the House Government Oversight and Reform Committee, the Senate Homeland Security and Governmental Affairs Committee, and other appropriate panels. The CIA IG Act similarly allows the director to prohibit or halt an investigation or audit; but he or she must notify the House and Senate intelligence panels of the reasons, within seven days. Presidentially appointed IGs in the establishments—but not in designated federal entities (DFEs)—are granted a separate appropriations account (a separate budget account in the case of the CIA) for their offices. This restricts agency administrators from transferring or reducing IG funding once it has been specified in law. Under the Inspector General Act, IGs in the larger establishments are appointed by the President, subject to Senate confirmation, and are to be selected without regard to political affiliation and solely on the basis of integrity and demonstrated ability in relevant fields. Two other IGs appointed by the President operate under similar but distinct requirements. The CIA IG is to be selected under these criteria as well as experience in the field of foreign intelligence. And the Special Inspector General for Afghanistan Reconstruction (SIGAR) is the only IG appointed by the President alone. Presidentially nominated and Senate-confirmed IGs can be removed only by the President; when so doing, he must notify Congress of the reasons. By comparison, IGs in the DFEs are appointed by and can be removed by the agency head, who must notify Congress in writing when exercising this power. The USPS IG is the only IG with removal "for cause" and then with the written concurrence of at least seven of the nine governors, who also appoint the officer. Terms of office are set for three IGs, but with the possibility of reappointment: in the Postal Service (seven years), AOC (five years), and U.S. Capitol Police (five years), with selection by the Capitol Police Board. Indirectly, the Peace Corps IG faces an effective term limit, because all positions there are restricted to five to 8½ years. With regard to Special Inspector General for Iraq Reconstruction (SIGIR) and SIGAR, each post is to end 180 days after its parent entity's reconstruction funds are less than $250 million. Several presidential orders govern coordination among the IGs and investigating charges of wrongdoing by high-echelon officers. Two councils, governed by E.O. 12805, issued in 1992, are the President's Council on Integrity and Efficiency (PCIE) and a parallel Executive Council on Integrity and Efficiency (ECIE). Chaired by the Deputy Director of the Office of Management and Budget (OMB), each is composed of the appropriate IGs plus officials from other agencies, such as the Federal Bureau of Investigation (FBI) and Special Counsel. Investigations of alleged wrongdoing by IGs or other top OIG officials (under the IG act) are governed by a special Integrity Committee, composed of PCIE and ECIE members and chaired by the FBI representative (E.O. 12993), with investigations referred to an appropriate executive agency or to an IG unit. Other coordinative devices have been created administratively. Statutory offices of inspector general have been authorized in 67 current federal establishments and entities, including all 15 cabinet departments; major executive branch agencies; independent regulatory commissions; various government corporations and boards; and five legislative branch agencies. All but nine of the OIGs are directly and explicitly under the 1978 Inspector General Act. Each office is headed by an inspector general, who is appointed in one of three ways: (1) 30 are nominated by the President and confirmed by the Senate in "establishments," including all departments and the larger agencies under the IG act, plus the CIA ( Table 1 ). (2) 36 are appointed by the head of the entity in 29 "designated federal entities"—usually smaller boards and commissions—and in seven other units, where the IGs operate under separate authority: SIGIR, ONDI, and five legislative agencies ( Table 2 ). (3) One (in SIGAR) is appointed by the President alone (Sec. 1229, P.L. 110-181 ). Initiatives in response to the 2005 Gulf Coast Hurricanes arose to increase OIG capacity and capabilities in overseeing the unprecedented recovery program. These include IGs or deputies from affected agencies on a Homeland Security Roundtable, chaired by the DHS IG; membership on a Hurricane Katrina Contract Fraud Task Force, headed by the Justice Department; an office in the DHS OIG to oversee disaster assistance activities nationwide; and additional funding for the OIG in Homeland Security. In the 110 th Congress, the IGs in DOD and in other relevant agencies have been charged with specific duties connected with combating waste, fraud, and abuse in wartime contracting ( P.L. 110-181 ). A new IG has been instituted in the AOC, in the GAO, and in the Afghanistan reconstruction effort, while other legislative action requires that full-agency websites link to the separate OIG "hotline" websites. Separate recommendations have arisen in the recent past, such as consolidating DFE OIGs under presidentially appointed IGs or under a related establishment office (GAO-02-575). Pending proposals in the 110 th Congress include the following: requiring IG annual reviews to report on program effectiveness and efficiency ( H.R. 6639 ); and establishing IGs for the Judicial Branch ( H.R. 785 and S. 461 ) and the Washington Metropolitan Area Transit Authority ( H.R. 401 ). The Intelligence Authorization Act for FY2009 ( H.R. 5959 and S. 2996 ) would create an inspector general for the entire Intelligence Community, a provision opposed by the Bush Administration; and would grant statutory recognition to specified OIGs in the Defense Department. Other bills— H.R. 928 and 2324 , whose earlier versions incurred objections from OMB—have been reconciled and await chamber action. These proposals are designed to increase the IGs' independence and powers. Different versions have called for providing specifics on initial OIG budget estimates to Congress; removing an IG only for "cause"; setting a term of office for IGs; establishing a Council of Inspectors General for Integrity and Efficiency in statute; revising the pay structure for IGs; allowing for IG subpoena power in any medium; and granting law enforcement powers to qualified IGs in DFEs.

Statutory offices of inspector general (OIG) consolidate responsibility for audits and investigations within a federal agency. Established by public law as permanent, nonpartisan, independent offices, they now exist in more than 60 establishments and entities, including all departments and largest agencies, along with numerous boards and commissions. Under two major enactments—the Inspector General Act of 1978 and its amendments of 1988—inspectors general are granted substantial independence and powers to carry out their mandate to combat waste, fraud, and abuse. Recent initiatives have added offices in the Architect of the Capitol Office (AOC), Government Accountability Office (GAO), and for Afghanistan Reconstruction; funding and assignments for specific operations; and mechanisms to oversee the Gulf Recovery Program. Other proposals in the 110th Congress are designed to strengthen the IGs' independence, add to their reports, and create new posts in the Intelligence Community. [Note: 5 U.S.C. Appendix covers all but nine of the statutory OIGs. See CRS Report RL34176, Statutory Inspectors General: Legislative Developments and Legal Issues, by [author name scrubbed] and [author name scrubbed]; U.S. President's Council on Integrity and Efficiency, A Strategic Framework, 2005-2010 http://www.ignet.gov; Frederick Kaiser, "The Watchers' Watchdog: The CIA Inspector General," International Journal of Intelligence (1989); Paul Light, Monitoring Government: Inspectors General and the Search for Accountability (1993); U.S. Government Accountability Office, Inspectors General: Office Consolidation and Related Issues, GAO-02-575, Highlights of the Comptroller General's Panel on Federal Oversight and the Inspectors General, GAO-06-931SP, and Inspectors General: Opportunities to Enhance Independence and Accountability, GAO-07-1089T; U.S. House Subcommittee on Government Management and Organization, Inspectors General: Independence and Accountability, hearing (2007); U.S. Senate Committee on Homeland Security and Governmental Affairs, Strengthening the Unique Role of the Nation's Inspectors General, hearing (2007); Project on Government Oversight, Inspectors General: Many Lack Essential Tools for Independence (2008).]

In 2005, the most recent year for which data are available, approximately $2.0 trillion was spent on health care and health-related activities. This amount represents a 6.9% increase over 2004 spending. The majority of health spending (84%) went towards paying for health care goods and services provided directly to individuals. These goods and services are referred to as personal health care. The remaining amount covered administrative expenses, public health activities, health research, construction of health facilities and offices and medical capital equipment. Table 1 indicates how much was spent on various categories of health care goods and services in 2005 and how much these amounts increased over 2004 levels. This report focuses on expenditures for personal health care, since these goods and services constitute most spending on health-related activities. The latter half of the 1990s experienced historically low growth in personal health care spending. From the beginning of 1994 to the end of 1999, health spending increased at an average annual rate of 5.6%. This low growth is attributable to changes in both the private and public sectors. In the private sector, the increased use of managed care limited cost growth during the mid-1990s. Vigorous fraud-and-abuse investigation and the Balanced Budget Act of 1997 (which slowed growth in hospital, home health, and nursing home payments) constrained health expenditures in the late 1990s. The effect of these changes in public and private sector have subsided; in 2000, personal health expenditures grew at 6.7%, 1.1 percentage points higher than the average rate over the previous six years. Personal health expenditures grew at even higher rates in 2001 (8.7%) but have fallen steadily since then. Looking from a broader historical perspective, spending growth in recent years is still much lower than that in most years since 1960 (see Figure 1 ). In particular, the years 1979 through 1981 experienced growth rates between 13.8% and 15.9%. Figure 1. Growth in Nominal Personal Health ExpendituresSource: Congressional Research Service (CRS) calculations using data from the Centers for Medicare and Medicaid Services, Office of the Actuary. Figure 1 depicts growth in nominal personal health expenditures. Three factors contribute to growth in nominal health spending: higher population, higher prices, and higher real per capita expenditures, which some experts label the "intensity" of care. Real per capita expenditures indicate qualitative and quantitative increases in the amount of care received by individuals. Figure 2 depicts the role of population, prices, and real per capita expenditures in nominal health expenditure growth. Caution should be used when interpreting data on real health expenditures, however. Real expenditures are estimated using price indexes for medical care goods and services, but such price indexes are imperfect. As a result of these imperfections, it is difficult to isolate prices and real per capita health expenditures from nominal health spending. Spending on personal health care in 2005 increased relative to the overall economy. In 2005, personal health care expenditures accounted for 13.3% of gross domestic product (GDP), up from 13.2% of GDP in 2003 and 2004, 12.8% of GDP in 2002 and 12.2% of GDP in 2001. These increases mark a departure from the experience of the previous nine years, when health spending as a percent of GDP was relatively constant. Between 1992 and 2000, personal health care expenditures averaged 11.6% of GDP (see Figure 3 ). Four categories of medical goods and services compose more than 84% of personal health care expenditures: hospital care, physician and clinical services, prescription drugs, and long-term care (which includes nursing home and home health care). In 2005, home health care was the fastest growing category of health expenditures, increasing 11.1% above 2004 expenditures (see Table 1 ). However, growth rates of individual categories of services can be deceptive at indicating how much a particular category of medical care contributed to overall spending growth. As indicated in Table 1 , the category with the largest dollar increase was hospital care. In 2005, spending on hospital care was $44.7 billion higher than in 2004, an increase of 7.9%. Home health care expenditures were $4.7 billion higher in 2005 than they were in 2004, an increase of 11.1%. Thus, even though home health care increased more than hospital care in terms of percentage growth, hospital care grew more than home health care in dollar terms. That is, growth in hospital care contributed most to increased personal health care expenditures in 2005. The $44.7 billion increase in hospital expenditures in 2005 accounted for 41% of the $110.1 billion increase in overall personal health care spending. Figure 4 shows how much dollar growth in each category of personal health care contributed to total growth in personal health expenditures. Much attention has been directed at spending on prescription drugs. The share of personal health expenditures devoted to prescription drugs has more than doubled since 1981, when drugs accounted for only 5.4% of personal health expenditures. Yet, 1981 represented the trough of a 20-year decline in spending on prescription drugs, as a share of personal health expenditures. While the percent of personal health expenditures spent on prescription drugs has grown significantly over the past two decades, prescription drug spending represented only a slightly greater share of personal health expenditures in 2005 as it did in 1960. This trend is illustrated in  Figure 5 . Long-term care, which includes nursing home and home health care, composes a larger share of health care than in the past. In 1960, about 4% of personal health care expenditures were spent on nursing home and home health care. In 2005, about 10% of personal health spending was directed towards providing nursing home and home health care. In 2005, 85% of personal health expenditures were in the form of third-party payments. Private health insurance was the largest payer of personal health care in 2005; it paid 36% of personal health expenditures. The federal government, the second largest payer, accounted for 34% of all personal health spending. The health care system underwent a shift over the last four decades from one financed primarily by out-of-pocket expenditures to one financed primarily by private insurance. Figure 6 shows how the funding of personal health care has changed from 1960 to 2005. Ultimately, all health care is funded by individuals through out-of-pocket expenditures (including insurance deductibles and co-payments), insurance premiums, taxes, and charitable contributions. Although private insurance and the federal government are the largest payers of overall personal health expenditures, their role in financing health care varies by type of medical care. Figure 7 illustrates how major categories of health care were funded in 2005 (detailed numbers for Figure 7 are provided in Table 2 ). The two largest categories of personal health care, hospital care and physician services, were financed primarily by private insurance and the federal government. A small share of these services were paid out-of-pocket. Conversely, almost all expenditures on non-durable medical goods (which includes mostly over-the-counter drugs) were paid out-of-pocket, although this category represents only a small share of all personal health care expenditures. Private insurance plays a relatively small role in financing nursing home and home health care. These services were funded mostly by the federal government and out-of-pocket expenditures. Dental services and prescription drugs are funded mostly by private insurance and out-of-pocket expenditures; the federal government plays a relatively small role in the financing of these services. State and local funds account for a small share of expenditures in all categories. The contribution of theses funds is largest in nursing home and home health care, and in hospital care.

In 2005, the most recent year for which data are available, just under $2 trillion was spent on health care and health-related activities. This amount represents a 6.9% increase over 2004 spending. The majority of health spending (84%) went towards paying for health care goods and services provided directly to individuals. These goods and services are referred to as personal health care. The remaining 16% of health spending covered research, public health activities, administrative costs, structures, and equipment. Personal health care expenditures grew 7.1% in 2005, continuing a downward trend in the growth of expenditures that peaked in recent times in 2001 at 8.7%. From the beginning of 1992 to the end of 2000, personal health expenditures grew at an average annual rate of 5.8%, historically low levels not seen since 1960. Compared with spending increases over the past 40 years, the 7.1% increase that occurred in 2005 is relatively moderate. In particular, the years 1979 through 1981 experienced growth rates between 13.8% and 15.9%. Relative to the overall economy, personal health expenditures increased in 2005. In 2005, personal health expenditures accounted for 13.3% of gross domestic product (GDP), up from 13.2% of GDP in 2004 and 2003, 12.8% of GDP in 2002, and 12.2% in 2001. For the nine years prior to 2001, health spending as a percentage of GDP was relatively constant. From 1992 to 2000, personal health expenditures, as a percentage of GDP, stayed between 11.5% and 11.7%. During the three decades prior to the 1990s, personal health expenditures, as a percentage of GDP, increased almost every year. Home health care spending was the fastest growing category of personal health care in 2005. Home health care spending in 2005 was 11.1% higher than the amount spent in 2004. Yet, because home health care represents about 3% of personal health expenditures, it was one of the smallest contributors to overall growth in personal health spending. Hospital care, which grew 7.9% in 2005 and accounts for more than one-third of personal health expenditures, contributed the most to overall growth in personal health spending. Spending on physician and clinical services, which grew at 7.0% in 2005 and accounts for one-fourth of personal health expenditures, was the second largest contributor to overall growth in personal health spending. Over 85% of personal health expenditures in 2005 were financed by third-party payers. The largest payer, private health insurance, financed 36% of all personal health expenditures. The second-largest payer, the federal government, accounted for 34% of all personal health spending. Certain categories of health care are funded primarily by third-party payers, whereas other categories are financed almost entirely out-of-pocket. The federal government is the largest payer of hospital care and nursing home and home health care. Private health insurance is the largest payer of dental services and prescription drugs. Out-of-pocket expenditures are the largest source of funding for non-durable medical goods (which include over-the-counter drugs) and durable medical goods (which include eyeglasses).

Section 319(a) of the Bipartisan Campaign Reform Act of 2002 (BCRA), also known as the McCain-Feingold law, establishes increased contribution limits for House candidates whose opponents significantly self-finance their campaigns. This provision, in tandem with Section 304, which applies a similar program to Senate candidates, is frequently referred to as the "Millionaire's Amendment." Generally, the complex statutory formula provides—using limits that were in effect at the time the case was considered—that if a candidate for the House of Representatives spends more than $350,000 of personal funds during an election cycle, individual contribution limits applicable to his or her opponent are increased from the usual current limit ($2,300 per election) to up to triple that amount (or $6,900 per election). Likewise for Senate candidates, a separate provision generally raises individual contribution limits for a candidate whose opponent exceeds a designated threshold level of personal campaign funding that is based on the number of eligible voters in the state. For both House and Senate candidates, the increased contribution limits are eliminated when parity in spending is reached between the two candidates. BCRA also requires self-financing candidates to file special disclosure reports regarding their campaign spending—as such expenditures are made—in addition to reporting in accordance with the regular periodic disclosure schedule. In 2004 and 2006, Jack Davis was a candidate for the House of Representatives from the 26 th Congressional District of New York. During the 2004 election cycle, he spent $1.2 million, which was principally from his own funds, and during the 2006 cycle, he spent $2.3 million, which (with the exception of $126,000) came from personal funds. In 2006, after the Federal Election Commission (FEC) informed Davis that it had reason to believe that he had violated BCRA's disclosure requirements for self-financing candidates by failing to report personal expenditures during the 2004 election cycle, Davis filed suit in the U.S. District Court for the District of Columbia seeking declaration that the Millionaire's Amendment was unconstitutional and an injunction preventing the FEC from enforcing the law during the 2006 cycle. A district court three-judge panel concluded sua sponte that Davis had standing to bring the suit, but rejected his claims on the merits and granted summary judgment to the FEC. Invoking BCRA's provision for direct appeal to the Supreme Court for actions brought on constitutional grounds, Davis appealed. Reversing the three-judge district court decision, in a 5-to-4 vote, the Supreme Court in FEC v. Davis invalidated the Millionaire's Amendment as lacking a compelling governmental interest in violation of the First Amendment. Justice Alito wrote the opinion for the majority and was joined by Chief Justice Roberts, and Justices Scalia, Kennedy, and Thomas. Justice Stevens wrote an opinion concurring in part and dissenting in part, and was joined, in part, by Justices Souter, Ginsburg, and Breyer. Justice Ginsburg also wrote an opinion, concurring in part and dissenting in part, which was joined by Justice Breyer. The Court remanded the case to the district court for proceedings consistent with its opinion. Citing prior decisions, the Court began its opinion by noting that it has long upheld the constitutionality of limits on individual contributions and coordinated party expenditures. While recognizing that contribution limits implicate First Amendment free speech interests, it has sustained such limits on the condition that they are "closely drawn" to serve a "sufficiently important interest" such as the prevention of corruption or the appearance of corruption. On the other hand, the Court observed that it has definitively rejected any limits on a candidate's expenditure of personal funds to finance campaign speech, finding that such limits impose a significant restraint on a candidate's right to advocate for his or her own election, which is not justified by the compelling governmental interest of preventing corruption. Instead of preventing corruption, use of personal funds lessens a candidate's reliance on outside contributions, thereby neutralizing the coercive pressures and risks of abuse that contribution limits seek to avoid. With regard to the Millionaire's Amendment, the Court observed that while it does not directly impose a limit on a candidate's expenditure of personal funds, it "imposes an unprecedented penalty on any candidate who robustly exercises that First Amendment right." Further, it requires a candidate to choose between the right of free political expression and being subjected to discriminatory contribution limits. If it simply increased the contribution limits for all candidates—both the self-financed candidate as well as the opponent—it would pass constitutional muster. Although many candidates who can afford significant personal expenditures in support of their own campaigns may choose to do so despite the Millionaire's Amendment, the Court determined that they would bear "a special and potentially significant burden if they make that choice." In fact, the Court concluded that if a candidate vigorously exercises the right to use personal funds, it creates a fundraising advantage for his or her opponents. In its 1976 landmark decision Buckley v. Valeo, the Supreme Court upheld a provision of the Federal Election Campaign Act (FECA) providing presidential candidates with the option to receive public funds on the condition that they comply with expenditure limits, even though it found overall expenditure limits to be unconstitutional. Distinguishing the Millionaire's Amendment from FECA's presidential public financing provision, the Davis Court observed that the choices presented by each of the statutes are "quite different." By forgoing public financing, a presidential candidate can still retain the unencumbered right to make unlimited personal expenditures. In contrast, the Millionaire's Amendment fails to provide any options for a candidate to exercise that right without limitation. Finding that the Millionaire's Amendment imposes a "substantial burden" on the First Amendment right to expend personal funds in support of one's own campaign, thereby triggering strict scrutiny, the Court announced that it is not sustainable unless it can be justified by a compelling governmental interest. As the Court held in Buckley, reliance on personal funds reduce s the threat of corruption, and therefore, the burden imposed by the Millionaire's Amendment cannot serve that governmental interest. Responding to the FEC's argument that the statute's "asymmetrical limits" are justified because they level the playing field for candidates of differing personal wealth, the Court pointed out that its jurisprudence offers no support for the proposition that this rationale constitutes a compelling governmental interest. According to the Court, preventing corruption or its appearance are the only legitimate compelling governmental interests—that have yet been identified—to justify restrictions on campaign financing. Moreover, "'the concept that government may restrict the speech of some elements of our society in order to enhance the relative voice of others is wholly foreign to the First Amendment.'" Specifically, the Court cautioned that restricting a candidate's speech in order to level opportunities for election among candidates presents "ominous implications" because it would permit Congress to "arrogate the voters' authority to evaluate the strengths of candidates competing for office." Voters are entrusted with the duty to judge candidates for public office and, according to the Court, Different candidates have different strengths. Some are wealthy; others have wealthy supporters who are willing to make large contributions. Some are celebrities; some have the benefit of a well-known family name. Leveling electoral opportunities means making and implementing judgments about which candidates should be permitted to contribute to the outcome of an election. The Constitution, however, confers upon voters, not Congress, the power to choose the Members of the House of Representatives, Article I, § 2, and it is dangerous business for Congress to use the election laws to influence the voters' choices. In considering the constitutionality of the disclosure requirements contained within the Millionaire's Amendment, the Court emphasized that it has repeatedly held that compelled disclosure significantly infringes on privacy of association and belief, as guaranteed under the First Amendment. Therefore, it has subjected such requirements to exacting scrutiny in order to ascertain whether there is a "relevant correlation" or "substantial relation" between the governmental interest and the information required to be disclosed. In view of its holding that the Millionaire's Amendment is unconstitutional, the Court likewise reasoned that the burden imposed by its disclosure requirements cannot be justified, and accordingly, struck them down. In a dissent, Justice Stevens—joined, in part, by Justices Souter, Ginsburg, and Breyer—argued that the Millionaire's Amendment represents Congress's judgment that candidates who spend over $350,000 of their own money in a campaign for a House or Senate seat have an advantage over other candidates who must raise contributions. The statute imposes no burden on self-financing candidates and "quiets no speech." Instead, the dissent found that it does no more than merely "assist the opponent of a self-funding candidate" to make his or her voice heard and that "this amplification in no way mutes the voice of the millionaire, who remains able to speak as loud and as long as he likes in support of his campaign." As a result of finding no direct restriction on the speech of the self-financed candidate, the dissent would subject the Millionaire's Amendment to a less rigorous standard of review. Indeed, the dissent specifically criticized the Court's landmark Buckley ruling, which struck down limits on expenditures, arguing that "a number of purposes, both legitimate and substantial," can justify the imposition of reasonable spending limits. Maintaining that combating corruption and the appearance of corruption are not the only governmental interests justifying congressional regulation of campaign financing, the dissent remarked that the Court has also recognized the governmental interests of reducing both the influence of wealth and the appearance of wealth on the outcomes of elections. While conceding that such prior decisions have focused on the aggregations of wealth that are accumulated in the corporate form, it reasoned that the logic of such decisions—particularly concerns about the "corrosive and distorting effects of wealth" on the political process—could be extended to the context of individual wealth as well. In a separate dissent, Justice Ginsburg—joined by Justice Breyer—concluded that sustaining the constitutionality of the Millionaire's Amendment would be consistent with the Court's earlier holding in Buckley v. Valeo . She resisted, however, joining Justice Stevens's dissent to the extent that it addresses the Court's ruling in Buckley invalidating expenditure limits. Noting that the Court had not been asked to overrule Buckley —and that this issue had not been briefed—Justice Ginsburg preferred to leave reconsideration of that case "for a later day." The Court's decidedly antiregulatory opinion in Davis appears to reaffirm its finding in the landmark 1976 decision, Buckley v. Valeo, that Congress has no compelling interest in attempting to level the playing field among candidates. In fact, the Davis Court determined that Congressional attempts to do so would supplant the choices of the voters. Notably, the decision also seems to be a departure from its 2003 decision in McConnell v. FEC —upholding key portions of BCRA—where the Court expressed deference to Congress's expertise in regulating the system under which its Members are elected. While Justice Stevens still appeared to subscribe to this view, the majority of the Davis Court seemed less deferential.

The "Millionaire's Amendment" is a shorthand description for a provision of the Bipartisan Campaign Reform Act of 2002 (BCRA), also known as the McCain-Feingold law, which established increased contribution limits for congressional candidates whose opponents significantly self-finance their campaigns. In 2008, in a 5-to-4 decision, Davis v. Federal Election Commission , the Supreme Court invalidated this provision. The Court found that the burden imposed on expenditures of personal funds is not justified by the compelling governmental interest of lessening corruption or the appearance of corruption and therefore, held that the law is unconstitutional in violation of the First Amendment.

Though only about three times the size of Washington, DC, and with a population of 4.7 million, the city-state of Singapore punches far above its weight in both economic and diplomatic influence. Its stable government, strong economic performance, educated citizenry, and strategic position along key shipping lanes make it a major player in regional affairs. For the United States, Singapore is a crucial partner in trade and security cooperation as the Obama Administration executes its rebalance to Asia strategy. Singapore's value has only grown as the Administration has given special emphasis to the Association of Southeast Asian Nations (ASEAN) as a platform for multilateral engagement. Singapore's heavy dependence on international trade makes regional stability and the free flow of goods and services essential to its existence. As a result, the nation is a firm supporter of both U.S. trade policy and the U.S. security role in Asia, but also maintains close relations with China. The People's Action Party (PAP) has won every general election since the end of the colonial era in 1959, aided by a fragmented opposition, Singapore's economic success, and electoral procedures that strongly favor the ruling party. Some point to shifts in the political and social environment that may herald more political pluralism, including generational changes and an increasingly international outlook among Singaporeans. In May 2011, opposition parties claimed their most successful results in history, taking six of parliament's 87 elected seats, and garnering about 40% of the popular vote. Though this still left the PAP with an overwhelming majority in Parliament, the ruling party described the election as a watershed moment for Singapore and vowed to reform the party to respond to the public's concerns. Singapore's parliamentary-style government is headed by the prime minister and cabinet, who represent the majority party in Parliament. The president serves as a ceremonial head of state, a position currently held by Tony Tan Keng Yam. Lee Hsien Loong has served as prime minister since 2004. Lee is the son of former Prime Minister Lee Kuan Yew, who stepped down in 1990 after 31 years at the helm. The senior Lee, 89 and widely acknowledged as the architect of Singapore's success as a nation, resigned his post as "Minister Mentor" following the 2011 elections, citing a need to pass leadership to the next generation. In 2010, changes to the constitution guaranteed that more non-PAP members would be represented in the parliament. The electoral reforms were seen as an acknowledgement by the PAP that it must adjust to a more open and diverse Singapore. Singapore's leaders have acknowledged a "contract" with the Singaporean people, under which individual rights are curtailed in the interest of maintaining a stable, prosperous society. Supporters praise the pragmatism of Singapore, noting its sustained economic growth and high standards of living. Others criticize the approach as stunting creativity and entrepreneurship, and insist that Singapore's leaders must respond to an increasingly sophisticated public's demand for greater liberties for economic survival. Greater, and generally freer, use of the Internet may be threatening to some of the leadership; in the past the government attempted to tighten control over bloggers, who may not exercise the same restraint as the mainstream media in limiting criticism of the ruling party or touching on sensitive issues such as race, in Singapore's multi-ethnic environment. Although it has been elected by a comfortable majority in every election since Singapore's founding, the PAP "places formidable obstacles in the path of political opponents," according to the U.S. State Department's 2012 Country Report on Human Rights Practices. The report states that "the PAP maintained its political dominance in part by circumscribing political discourse and action." According to Amnesty International, defamation suits by PAP leaders to discourage opposition are widespread. The political careers of opposition politicians are marked by characteristic obstacles from the ruling party, including being forced to declare bankruptcy for failing to pay libel damages to prominent PAP members. Singapore's economy depends heavily on exports, particularly in consumer electronics, information technology products, pharmaceuticals, and financial services. The GDP per capita is $61,400 (2012 estimate). China, Malaysia, and the United States are Singapore's largest trading partners. The U.S.-Singapore Free Trade Agreement (FTA) went into effect in January 2004—the U.S.'s first bilateral FTA with an Asian country—and trade has burgeoned. In 2012, Singapore was the 17 th largest U.S. trading partner with $50 billion in total two-way goods trade, and a substantial destination for U.S. foreign direct investment. In 2012, U.S. exports to Singapore exceeded $30 billion, a historic high. Singapore was the largest U.S. trading partner in ASEAN in 2012, accounting for $31.4 billion in exports and $19.1 billion in imports. The U.S. trade surplus with Singapore is the fifth largest American surplus in the world. U.S. direct foreign investment in Singapore has increased more than 20%, exceeding $116 billion in cumulative investment in 2012. Singapore and the United States are among the 12 countries on both sides of the Pacific involved in the Trans-Pacific Partnership (TPP), which is the centerpiece of the Obama Administration's economic rebalance to Asia. With Japan's entry in the talks, the TPP participants represent a third of the world's trade. Singapore's record of championing rigorous trade pacts make it an important negotiating partner in pushing for a comprehensive agreement. Singapore has concluded at least 18 free trade agreements (FTAs) and is pursuing several more, including the Regional Comprehensive Economic Partnership (RCEP), a 16-nation group of Asian nations which is negotiating a free trade agreement at the same time some of its members are working on the TPP. Such agreements are relatively easy for Singapore to negotiate because, in addition to having a mature, globalized economy, it has virtually no agricultural sector and its manufacturing is limited to specialized sectors. The 2005 "Strategic Framework Agreement" formalizes the bilateral security and defense relationship. The agreement, the first of its kind with a non-ally since the Cold War, builds on the U.S. strategy of "places-not-bases" in the region, a concept that allows the U.S. military access to facilities on a rotational basis without bringing up sensitive sovereignty issues. The agreement allows the United States to operate resupply vessels from Singapore and to use a naval base, a ship repair facility, and an airfield on the island-state. The U.S. Navy also maintains a logistical command unit—Commander, Logistics Group Western Pacific—in Singapore that serves to coordinate warship deployment and logistics in the region. As part of the agreements, squadrons of U.S. fighter planes are rotated to Singapore for a month at a time, and naval vessels make regular port calls. Changi Naval Base is the only facility in Southeast Asia that can dock a U.S. aircraft carrier. Singapore forces also train regularly in the United States. Security cooperation has continued to grow under the Obama Administration: the two sides have increased bilateral exercises and training, including combined air combat exercises for fighter units for the countries' air forces, as well as enhanced joint urban training at Singapore's sophisticated Murai Urban Training Facility. An April 2012 agreement outlines bilateral initiatives to strengthen global cargo security procedures; in 2003, Singapore was the first Asian country to join the Container Security Initiative (CSI), a series of bilateral, reciprocal agreements that allow U.S. Customs and Border Patrol officials at selected foreign ports to pre-screen U.S.-bound containers. It was also a founding member of the Proliferation Security Initiative (PSI), a program that aims to interdict weapons of mass destruction-related shipments. In April 2013, the USS Freedom , a U.S. Navy littoral combat ship (LCS) arrived in Singapore to begin a 10-month deployment in Southeast Asia. The stationing of the LCS, the first of four ships, is emblematic of the role that Singapore can play in the U.S. "pivot" to the region. The vessel is the first U.S. Navy ship to be designed to fight close to shore in shallow waters, to carry a smaller crew, and to boast flexible capabilities that include anti-mine and anti-submarine missions. The smaller size also makes them more amenable to doing exercises with countries that have smaller-scale naval forces. Singapore's combination of sophisticated facilities and political standing in the region allows it to host such U.S. naval assets. Singapore has been a strong champion of ASEAN, which helps Southeast Asia's mostly small countries to influence regional diplomacy, particularly vis-à-vis China. Renewed U.S. engagement under the Obama Administration has pleased Singapore and may have allowed it more diplomatic space to stand up to Beijing on key issues. Singapore has praised the Administration's "rebalancing" effort toward Asia, yet has been careful to warn that anti-China rhetoric or efforts to "contain" China's rise will be counterproductive. During an April 2013 visit to Washington, Prime Minister Lee advised the United States to strengthen its economic ties to the region and develop more trust with Beijing. Maintaining strong relations with both China and the United States is a keystone of Singapore's foreign policy. Singapore often portrays itself as a useful balancer and intermediary between major powers in the region. In the South China Sea dispute, for example, in 2011 Singapore—a non-claimant—called on China to clarify its island claims, characterizing its stance on the issue as neutral, yet concerned because of the threat to maritime stability. At the same time, Singapore was hosting a port visit by a Chinese surveillance vessel, part of an ongoing exchange on technical cooperation on maritime safety with Beijing. China's economic power makes it a crucial component of trade policy for all countries in the region, but Singapore's ties with Beijing are multifaceted and extend to cultural, political, and educational exchanges as well. There are frequent high-level visits between Singapore and China. Singapore adheres to a one-China policy, but has an extensive relationship with Taiwan and has managed it carefully to avoid jeopardizing its strong relations with Beijing. Taiwan and Singapore have held large-scale military exercises annually for over 30 years and, in 2010, announced the launch of talks related to a free-trade pact under the framework of the World Trade Organization. Although it has been elected by a comfortable majority in every election since Singapore's founding, the PAP "places formidable obstacles in the path of political opponents," according to the U.S. State Department's 2012 Country Report on Human Rights Practices. The report states that "the PAP maintained its political dominance in part by intimidating organized political opposition and circumscribing political discourse and action." According to Amnesty International, defamation suits by PAP leaders to discourage opposition are widespread. The PAP ideology stresses the government's role in enforcing social discipline and harmony in society, even at the expense of individual liberties. The political careers of opposition politicians are marked by characteristic obstacles from the ruling party, including being forced to declare bankruptcy for failing to pay libel damages to prominent PAP members. International watchdog agencies criticize Singapore's control of the press as well. In 2013, Reporters Without Borders ranked Singapore 149 th out of 179 countries in terms of press freedom, its worst performance ever on the index. New media controls have been stepped up as well: in 2013 the government issued new regulations for online news sites that report on Singapore, prompting international internet companies with a presence in the city-state to criticize the move as backward-looking.

A former trading and military outpost of the British Empire, the tiny Republic of Singapore has transformed itself into a modern Asian nation and a major player in the global economy, though it still substantially restricts political freedoms in the name of maintaining social stability and economic growth. Singapore's heavy dependence on international trade makes regional stability and the free flow of goods and services essential to its existence. As a result, the island nation is a firm supporter of both U.S. international trade policy and the U.S. security role in Asia, but also maintains close relations with China. The Obama Administration's strategy of rebalancing U.S. foreign policy priorities to the Asia-Pacific enhances Singapore's role as a key U.S. partner in the region. Singapore and the United States are among the 12 countries on both sides of the Pacific involved in the Trans-Pacific Partnership (TPP), which is the centerpiece of the Obama Administration's economic rebalance to Asia. The People's Action Party (PAP) has won every general election since the end of the colonial era in 1959, aided by a fragmented opposition, Singapore's economic success, and electoral procedures that strongly favor the ruling party. Some point to changes in the political and social environment that may herald more political pluralism, including generational changes and an ever-increasingly international outlook among Singaporeans. In May 2011, opposition parties claimed their most successful results in history, taking six of parliament's 87 elected seats. Though this still left the PAP with an overwhelming majority in Parliament, the ruling party described the election as a watershed moment for Singapore and vowed to reform the party to respond to the public's concerns. In 2012, Singapore was the 17th largest U.S. trading partner with $50 billion in total two-way goods trade, and a substantial destination for U.S. foreign direct investment. The U.S.-Singapore Free Trade Agreement (FTA) went into effect in January 2004, and trade has burgeoned. In addition to trade, mutual security interests strengthen ties between Singapore and the United States. A formal strategic partnership agreement outlines access to military facilities and cooperation in counterterrorism, counter-proliferation of weapons of mass destruction, joint military exercises, policy dialogues, and shared defense technology.

RS20787 -- Army Transformation and Modernization: Overview and Issues for Congress Updated March 11, 2004 Modernization is not a new issue or objective for U.S. military forces, but it has taken on new urgency because of: the post-Cold War downsizing andprocurement reductions, the new global environment and unexpected requirements, and the promise of a "revolutionin military affairs" (RMA) suggested byrapid developments in computers, communications, and guidance systems. The last notable surge in modernizationculminated during the "Reagan build-up" ofthe 1980's. Weapons and doctrines developed and fielded in that era made fundamental contributions to UnitedStates successes in the Cold War, the Gulf War,and Kosovo. For the Army, such weapons included the M1 Abrams tank, M2 Bradley armored fighting vehicle,Apache attack helicopter, Blackhawk utilityhelicopter, and Patriot air defense system. During post-Cold War downsizing, the Army greatly decreased purchase of new equipment and largely deferred development of a next generation of weapons,with notable exceptions being R&D for a howitzer, the Crusader, and a reconnaissance helicopter, theComanche. (1) Much older equipment was retired. Modernization was approached through upgrading and inserting new technologies into previously acquired"legacy," systems. Information technology wasseen as the most immediate, promising aspect of RMA. It exploited Desert Storm successes such as pinpointtargeting and navigation, while addressingproblems such as friendly fire casualties. A major initiative was launched in the 1990's to create Army Force XXI,based on the "digitization" of thebattlefield, now dubbed "network-centric warfare." Modern computers and communications systems would connectall weapons systems and give U.S. soldiersand commanders advantages in situational awareness and speed of decisions. (2) One heavy, mechanized division at Fort Hood, TX was so equipped in 2001and was battle tested in Iraq in 2003. Other units were at least partially equipped and trained with this capabilitybefore commitment in Iraq. Even before Desert Storm, the "battlefield" was changing as the Army was called upon to respond to numerous, lengthy operations short of war rather thanoccasionally to defeat a large army. Near-term readiness became a problem as fewer troops were asked to covermore missions, and operation and maintenance(O&M) funds were diverted from fixing aging equipment and facilities to pay for unbudgeted deployments suchas Bosnia (funds eventually replaced in part byemergency supplemental appropriations). The problem of rapidly projecting heavy forces had been highlightedbeginning with the long buildup required for Desert Shield/Desert Storm in 1990-91. In 1999, it was suggested that an Army task force inserted intoAlbania for potential action in Kosovo was too heavyfor rapid air insertion and the unimproved roads and bridges found there. The Army determined that a newcapability was needed in addition to mobile, lightforces and heavy, lethal forces - a medium, lethal force. In October 1999, the Army announced its priority program to transform into a force that could better meet future requirements to be both rapidly deployable andlethal. The first step was near-term fielding of a new unit, first called the Interim Brigade Combat Team but nowcalled the Stryker Brigade Combat Team(SBCT), based on a wheeled armored vehicle much lighter than the standard M2 Bradley. For the long-term, theArmy is developing a Future Combat System(FCS) based on new technologies that would equip very mobile formations with lethality and survivability equalor greater than that of present heavy units. Until the FCS is fielded, the Army believes it must also continue to maintain and upgrade legacy weapons systems(e.g., M1, M2, etc.) and equipment in unitsthat can meet any potential foe across the spectrum of conflict. These Legacy, Interim, and Objective Forces wouldeventually meld into the transformedObjective Force of the future. In Summer of 2003, the new Army Chief of Staff emphasized that the Army was atwar and transforming. The Current Forcewould incorporate usable technology and other ideas being developed for the Future Force without waiting, movingtowards the Future Force while fighting theGlobal War on Terrorism. He also began a short term reorganization of the active Army from 33 to 48 combatbrigade modules using existing resources and atemporary increase of 30,000 in soldier end strength. (4) Stryker Force. The Army is fielding a new capability based on the SBCT. This unit is designed formaximum strategic and operational mobility in that its equipment can be airlifted inter-theater in all U.S. cargoaircraft, including the comparatively smallC-130 Hercules. All vehicles weigh less than 20 tons. The goal is that a SBCT could be completely moved to acombat zone within 96 hours. It is an infantrybrigade of about 3,500 soldiers with the armored mobility needed to fight on a mid-intensity battlefield. Particularstrengths are an included reconnaissance andintelligence battalion and "network-centric" command, control, and communications (C3) systems. The effort beganearly in 2000 at Fort Lewis, WA, wheretwo existing brigades were converted, using temporary, borrowed equipment. In November, 2000 the Army selected the Light Armored Vehicle III (LAV III), built by General Motors Defense and General Dynamics Land Systems, as its"interim armored vehicle" under a six year contract worth $4 billion. (5) Some 2,131 LAV III's, now called Strykers, will be procured. They willinclude twovehicle variants, an infantry carrier with eight additional configurations and a mobile gun system with a 105 mmcannon. The vehicle can negotiate flatsurfaces at 62 mph, convert to 8-wheel drive off-road, and self-recover with its winch if needed. As of early 2004,the first Stryker Brigade was conductingstability operations in a sector of Iraq. Plans also include procurement of the Joint Lightweight 155 mm Howitzerfor the Brigade's included field artillery --an Army-Marine program, with an estimated cost of about $1.1 billion, aiming for Army initial operating capability(IOC) at the end of 2004. Future Force. For the long-term, the Defense Advanced Research Projects Agency and the Army beganwork on some 25 critical technologies for incorporation into R&D of new systems to be selected as early as2006, with fielding to begin by 2008 and IOC by2010. (6) A key component is expected to be a FutureCombat System (FCS) that could, as one capability, assume the role currently held by the Abrams tank. Itis intended to be as transportable and mobile as the Stryker, with lethality and crew survivability equivalent to orgreater than that of today's tanks. The FCSmay, however, bear little or no resemblance to today's tanks and could feature advanced technologies such asrobotics and electric guns and facilitate newoperational doctrines. The FCS currently encompasses some 18 subsystems and the network to tie them together. Boeing Company and Science ApplicationsInternational Corp. were selected as the lead system integrator. As of September 2002, the Army had budgeted $20billion to develop FCS. FutureForce units will also incorporate ongoing developments in information technology. They should respond to allrequirements from stability operations tohigh-intensity conflict. Current Force. Until the Future Force exists, the Army must be prepared to fight with legacy equipment,whether on low or high-intensity battlegrounds. According to Army planners, programs to replace and/or upgradeolder equipment must continue if forces otherthan or additional to 6 new Stryker Brigades are to be ready for combat. The ongoing program to replace old truckswill continue. Older models of the Abramstank and the Bradley fighting vehicles will continue to be rebuilt and upgraded. The current force will have manyM1A2 SEP (for Systems EnhancementPackage) and M1A1D tanks and M2A3 and M2A2ODS with applique Bradley's. Inserting these vehicles into theforce will aid the whole Army in convertingto a digitized force. Although modernization of the current force is important, the Army sacrificed manypreviously desired programs to free funds fortransformation priorities. Examples are a dedicated Command and Control vehicle, the Grizzly Breacher engineervehicle, and the Wolverine assault bridgevehicle. The 107th and 108th Congresses gave strong support to Army modernization and transformation initiatives. At the same time, Congress showed caution bypressing a requirement to compare the wheeled LAV III with similar tracked vehicles already in inventory. TheArmy believes its evaluation demonstrated thatbuying Stryker was more desirable than converting the M113A3 APC. (7) Whether the 108th Congress will continue to support Armytransformation as a highpriority will depend on its evaluation of issues such as those discussed below. Desirability. All Services have felt pressures to "transform," or at least adapt to current circumstances andexperiences with the post-Cold War world. These include opportunities and challenges from a rush of technologicaladvances, unexpected numbers and typesof missions (particularly peacekeeping and urban warfare requirements), new threats from potential enemies withnuclear, chemical, or biological weapons, and,for the Army, criticism that it was not "nimble" enough during 1999 allied operations in Kosovo. The broadest long-term question is whether current transformation plans will yield the military forcecapabilities the United States requires 20 years from now. Should they include a power projection Army capable of fighting equally well across the full spectrum of groundcombat; or, should other services or entitiesassume some parts of that mission? Will Army plans over-stress DoD airlift assets, or would more reliance on fastsealift yield greater flexibility andeconomies? Internally, has the Army sought the right approach to transformation with its emphasis onmedium-weight formations? Does the Army's planstrike the right balance in allocating resources between modernizing the current legacy force and developing andfielding the Future Force? For the short term, it is projected that some amount of modernization for current forces is needed to prevent further aging and degradation. The average age ofthe M1 tank fleet is now 11.9 years and an estimated 11.7 years for support vehicles. (8) Many of these vehicles may not be able to remain in service beyond2030 without some form of service life extension. Deciding the proper allocation of resources is made morecomplex by the large numbers and diverse typesof vehicles and weapons systems in the Army, which makes it difficult to gather and present desirable data, that isboth comprehensive and aggregated, onequipment age, condition, and potential combat effectiveness. The Navy, in managing a fleet of about 315 ships,may have an easier job describing the level ofinvestment needed to maintain a fleet of a given size over time. (9) Congress may consider recommending that the Army attempt to develop some aggregateportrayal of its fleet capitalization status and implications of various funding strategies. Feasibility. The Army plan for transformation is considered aggressive. But, by using largely off-the-shelfmateriel, the "interim Stryker force is fairly low risk for meeting technology objectives. After an initial slip of 16months, a contractor's protest, and initialhesitation by the incoming Bush Administration, deliveries of Strykers are now supporting the fielding of 6 SBCTs,to be completed by May 2010. (10) Plans for the Future Force involve higher risk in both technology and time. It is possible that integration of all the specific FCS technologies into a leap-aheadsystem will experience some problems. The goal of fielding the first unit of this system of 18 systems by 2010 isvery ambitious. (11) Previoussystem-development efforts of this kind have often encountered technical problems, schedule problems, or both. The need for the Comanche helicopter, forexample, was identified in 1979 and it had not yet entered production when cancelled in 2004. The original targetdate proposed for FCS, 2023, may be morerealistic but it also raised concerns regarding duration of development. Congress will likely influence the priorityand speed with which the FCS becomesreality. Affordability. Some question the Army's ability to finance its transformation plan, particularly given aninability in recent years to finance many procurement programs at desired rates. Can the Army adequately financeall three elements of its plan at once, whilealso providing adequate funds for necessary non-transformation priorities such as readiness and pay and benefits? The life-cycle cost for equipping 6 brigadeswith LAV III's has been estimated by program officials at $9 billion through FY2032. (12) This will only be part of the total cost to transform and modernize theArmy; some have estimated that the Army requires a sustained increment of $10 billion annually beyond its averagepost-Cold War expenditures for R&D andprocurement. The Army is not alone in claiming a need for more investment funds. Other Services cite even highernumbers. (13) An issue that will confront Congress is whether to fund Army transformation and modernization efforts at levels proposed by the Bush Administration, orhigher or lower. If Congress ascribes a higher priority to Army transformation, will necessary funds be providedby adding to overall DoD appropriations,subtracting from DoD programs in other services, or reducing deployments? During the FY2003 budget cycle, DoD expressed its intent to cut acquisition programs that do not meet its definition of "transformational" in favor of those thatdo. Its prime example was the Army's Crusader Howitzer program. DoD cut Crusader and allocated the savingsto several other advanced fire support systemsin development. Congress reluctantly endorsed the action with the proviso that Crusader expertise be rolled intothe FCS program. As part of its appropriationsresponsibilities, the 108th Congress may choose to enforce DoD's implied promise to supportadequately fire support throughout the FCS developmentprogram. (14) Wheels or Tracks and How Many Stryker Brigades? An early issue to confront the Army was whether theInterim Force should use tracked or wheeled armored vehicles, or some combination. (15) Traditionally, the U.S. Army has favored tracks for its combatvehicles; with their low ground pressure and greater traction, they generally perform better off roads on difficultterrain. Wheels generally perform better onroads in terms of speed, agility, and quietness. After reviewing proposals, the Army selected the wheeled LAV IIIfrom General Motors, and named it Stryker. Critics of the decision, including some current and former members of Congress, continue to argue for a reversalor curtailment of the Stryker decision. (16) TheArmy defends its case strongly and DoD has not intervened. The question of whether the FCS will be based onwheels, tracks, or a combination remains open. DoD has, however, raised questions about the ultimate number and stationing of SBCT's. In the past, it requested the Army consider stationing one of the sixunits in Europe and thhe first one is now on station in Europe. More recently it suggested that units five and sixnot be funded unless they could be "spiraldeveloped" into much more transformational formations. It appears, however, that funding for all 6 SBCT's willnow be requested. The combination of theseevents and considerations could, however, open prior decisions to station SBCT's in Hawaii and Alaska to debateand thus create political complications. (17) The 108th Congress may play an important role in resolving the ultimate disposition of the proposedSBCT Force.

The U.S. Army continues an ambitious program intended to transform itself into astrategically responsive forcedominant in all types of ground operations. As planned, its Future Force will eventually meld all ongoing initiativesinto a force based on a high-tech FutureCombat System (FCS). Its Current Force is beginning to provide a new combat capability, based oncurrent-technology armored vehicles, for the mid-intensitycombat operations that seem prevalent in today's world. Its current "legacy force" of existing systems is beingmodernized and maintained to ensure effectivelight and heavy force capabilities until the Future Force is realized. This short report briefly describes the programand discusses issues of feasibility, viability,and affordability of potential interest to Congress. It will be updated as events warrant.

In the Anglo-American linguistic tradition, the word "charter" has been used to refer to many legal writs, including "articles of agreement," "founding legislation," "contracts," "articles of incorporation," and more. The varied uses of this term to refer to so many different legal writs may reflect the term's etymology. "Charter" is derived from the Latin "charta" or, perhaps, the ancient Greek "chartês," both of which mean "paper." As used in federal statutory law, the term "charter" usually has carried a much more specific meaning. A congressional or federal charter is a federal statute that establishes a corporation. Such a charter typically provides the following characteristics for the corporation: (1) Name; (2) Purpose(s); (3) Duration of existence; (4) Governance structure (e.g., executives, board members, etc.); (5) Powers of the corporation; and (6) Federal oversight powers. Beyond conferring the powers needed to achieve its statutorily assigned goal, a charter usually provides a corporation with a set of standard operational powers: the power to sue and be sued; to contract and be contracted with; to acquire, hold, and convey property; and so forth. Many of the original 13 colonies were established by royal charters, and both colonies and states incorporated governmental and private entities before the United States was established. However, at the Constitutional Convention in Philadelphia in 1787, the Founders disagreed over the wisdom of giving the proposed federal government the power to charter corporations. Nevertheless, Congress chartered its first corporation—the Bank of the United States—in February of 1791 (1 Stat. 192 Section 3). Any dispute over Congress's power to charter corporations was effectively put to an end by the Supreme Court's decision in McCulloch v. Maryland in 1819 (17 U.S. (4 Wheat.) 315). The Court ruled that incorporation could be a "necessary and proper" means for the federal government to achieve an end assigned to it by the U.S. Constitution. After chartering the national bank, though, for the next century, Congress issued charters mostly in its role as manager of the affairs of the District of Columbia (Article I, Section 8, clause 17). The District of Columbia, which became the seat of the federal government in 1790, had neither a general incorporation law nor a legislature that could grant charters. So it fell to Congress incorporate the District's corporations. Thus, Congress issued charters to establish the office of the mayor and the "Council of the City of Washington" in 1802 (2 Stat. 195-197) and to found the Washington City Orphan Asylum in 1828 (6 Stat. 381). Congress, however, also used charters to establish entities of national significance, such as the transcontinental Union-Pacific railroad in 1862 (12 Stat. 489). In the 20 th century, Congress began chartering a large number of corporations for diverse purposes. In part, Congress's resort to the corporate device was a response to a host of national crises, such as the two World Wars (which required the production of an enormous number of goods) and the Great Depression (which revealed the limited power the federal government had over the national economy). Corporations, it was thought, were by nature better suited than typical government agencies to handle policy areas that required commercial-type activities (for example, selling electrical power, as the Tennessee Valley Authority does). While each congressionally chartered corporation is unique insofar as it is fashioned for a very particular purpose, these entities still may be sorted into rough types. An elementary division is between those chartered as nonprofit corporations versus those that are not. Table 1 provides a further—but not exhaustive—typology of congressionally chartered corporations. Congressionally chartered corporations have raised diverse issues for Congress, including (1) Title 36 corporations' membership practices; (2) prohibitions on Title 36 corporations engaging in "political activities"; (3) confusion over which corporations are governmental and which are private; and (4) federal management of these corporations. The membership practices of some Title 36 corporations periodically have been a subject of concern. In 2011, Congress revised the membership criteria of the Blue Star Mothers of America, Inc. (36 U.S.C. 305) by enacting a statute ( P.L. 112-65 ; 125 Stat. 767). The change, which the organization had advocated, liberalized the membership requirements so as to enable the organization to admit a larger number of members. Similarly, Congress amended the charter of the Military Order of the Purple Heart of the United States of America, Incorporated, in 2007 to make its membership requirements less stringent ( P.L. 110-207 ; 122 Stat. 719). Some individuals had complained that the organization's criteria for membership were too narrow. In 2005, the congressionally chartered American Gold Star Mothers (AGSM) refused to admit to membership a non-U.S. citizen. Some individuals and members of the media called upon Congress to intervene and rectify this situation. Ultimately, the group used its own authorities to address the issue. Approximately 100 Title 36 corporations exist, thus Congress again may find itself having to consider legislation to contend with the membership issues of such organizations. More than half of the Title 36 corporations' charters include prohibitions against various "political activities." For example, the charter of the United States Submarine Veterans of World War II, states the following: "Political Activities. The corporation or a director or officer as such may not contribute to, support, or otherwise participate in any political activity or in any manner attempt to influence legislation" (36 U.S.C. 220707(b)). Other Title 36 corporations' charters forbid them from promoting the candidacy of an individual seeking office (e.g., The American Legion), or contributing to, supporting, or assisting a political party or candidate (e.g., AMVETS). Congressionally chartered organizations that are subject to political activities restrictions occasionally have asked Congress to remove these restrictions from their charters. For example, on May 21, 2008, Representative James P. Moran introduced H.R. 6118 (110 th Congress), which would have removed the political activities prohibition from the charter of Gold Star Wives. Representative Moran stated that this prohibition against attempting to influence legislation hurt the organizations "advocacy on behalf of military families." He also said that the prohibition was "punitive, not practically enforceable, and potentially an unconstitutional infringement upon the [First Amendment] freedom to petition the Government." The bill was referred to the Subcommittee on Immigration, Citizenship, Refugees, Border Security, and International Law, which took no action on it. Having political activities restrictions in congressional charters raises at least three issues: (1) Should any or all Title 36 corporations be forbidden from engaging in political activities? (2) If some or all of them should be so restricted, which activities ought to be defined as political? (3) Should Title 36 corporations only have the same restrictions on their political activities as purely private sector not-for-profit corporations? Congress is free to draft corporate charters to include whatever elements it deems appropriate. So, for example, the charter of the Securities Investor Protection Corporation (15 U.S.C. 78(ccc) et seq.) looks very different from that of the American National Red Cross (36 U.S.C. 3001 et seq.). The power to craft corporations ad hoc, however, has produced confusion when corporations are established quasi governmental entities (i.e. entities that have both governmental and private sector attributes). This distinction is not without consequence; governmental entities operate under different legal authorities and restrictions than do private sector corporations. For example, federal agencies typically must follow many or all of the federal government's general management laws. Thus, confusion arose over the National Veterans' Business Development Corporation (NVBDC; 15 U.S.C. 657(c)). The Department of Justice declared it to be a government corporation in March 2004. Some members of Congress disagreed. The 2004 Omnibus Appropriations Act ( P.L. 108-447 , Division K, Section 146) attempted to dispel the confusion by stating that the NVBDC was "a private entity" that "is not an agency, instrumentality, authority, entity, or establishment of the United States Government." In some instances, federal courts have been asked to intervene and make a determination of a corporation's status. The management of government corporations has been made difficult by a few factors. First, no single federal department or office is charged with overseeing the activities of all congressionally chartered corporations. Second, many of these corporations were established independently of any department and have few, if any, federal appointees on their boards or in their executive ranks. This separation of corporations from departments may make the federal management of corporations more difficult. Third, the Government Corporation Control Act (31 U.S.C. 9101-9110) provides many tools for managing chartered corporations' activities. However, Congress has excepted many corporations from some or all of the act's provisions. Finally, there is the matter of perpetual succession. In centuries past, states and municipalities often limited the duration of a charter; a corporation would expire unless the sovereign renewed its charter. This practice has fallen by the wayside; usually, Congress charters entities to have "perpetual succession." This means that a corporation may continue to operate, whether it is effective or not, until a law is enacted to abolish it—which seldom occurs. Long-lived chartered entities have been accused of taking business from the private sector, moving into areas of business or activities outside the bounds of their charters, and developing networks of influence to protect themselves from abolition.

A congressional or federal charter is a federal statute that establishes a corporation. Congress has issued charters since 1791, although most charters were issued after the start of the 20th century. Congress has used charters to create a variety of corporate entities, such as banks, government-sponsored enterprises, commercial corporations, venture capital funds, and quasi governmental entities. Congressionally chartered corporations have raised diverse issues for Congress, including (1) Title 36 corporations' membership practices; (2) prohibitions on Title 36 corporations engaging in "political activities"; (3) confusion over which corporations are governmental and which are private; and (4) federal management of these corporations. This report will be updated annually. Readers seeking additional information about congressionally chartered organizations may consult: CRS Report RL30365, Federal Government Corporations: An Overview, by [author name scrubbed]; CRS Report RL30533, The Quasi Government: Hybrid Organizations with Both Government and Private Sector Legal Characteristics, by [author name scrubbed]; and CRS Report RL30340, Congressionally Chartered Nonprofit Organizations ("Title 36 Corporations"): What They Are and How Congress Treats Them, by [author name scrubbed].

In health insurance, beneficiaries may face two types of out-of-pocket payments: (1) participation-related cost-sharing, typically in the form of monthly premiums, regardless of whether services are utilized, and (2) service-related cost-sharing, which consists of payments made directly to providers at the time of service delivery. Such beneficiary cost-sharing under Medicaid is described below. In order to obtain health insurance generally, enrollees may be required to pay monthly premiums and/or, less frequently, enrollment fees. Such charges are prohibited under traditional Medicaid for most eligibility groups. Nominal amounts set in regulations, ranging from $1 to $19 per month, depending on monthly family income and size, can be collected from (1) certain families moving from welfare to work who qualify for transitional assistance under Medicaid, and (2) pregnant women and infants with annual family income exceeding 150% of the federal poverty level (FPL), or, for example, about $19,800 for a family of two. Premiums and enrollment fees can exceed these nominal amounts for other specific groups. For example, for certain individuals who qualify for Medicaid due to high out-of-pocket medical expenses, states may implement a monthly fee as an alternative to meeting financial eligibility thresholds by deducting medical expenses from income (i.e., the "spend down" method). Cost-sharing is not capped for workers with disabilities and income up to 250% FPL. Premiums cannot exceed 7.5% of income for other workers with disabilities and income between 250% and 450% FPL. (If a state covers both groups, the same cost-sharing rules must apply.) Finally, some groups covered by Medicaid through certain waivers can be charged premiums that exceed nominal amounts. Under DRA authority, the general rules regarding applicable premiums are specified for three income ranges. For individuals with income under 100% FPL, and between 100% to 150% FPL, premiums are prohibited. Like traditional Medicaid, other specific groups (e.g., some children, pregnant women, individuals with special needs) are also exempt from paying premiums under the new DRA option. For persons with income above 150% FPL, DRA places no limits on the amount of premiums that may be charged. For the most part, premiums are not used under traditional Medicaid, except for workers with disabilities and waiver populations. Among the four states (Idaho, Kansas, Kentucky, and West Virginia) with approval for alternative DRA benefit packages, only Kentucky imposes monthly premiums: (1) $20/family with children with income over 150% FPL who are enrolled in the State Children's Health Insurance Program (SCHIP; additional details below), and (2) up to $30/family (not to exceed 3% of the adjusted, average monthly income) during the last six months of transitional Medicaid for working families with income over 100% FPL. Beneficiary out-of-pocket payments to providers at the time of service can take three forms. A deductible is a specified dollar amount paid for all services rendered during a specific time period (e.g., per month or year) before health insurance (e.g., Medicaid) begins to pay for care. Coinsurance is a specified percentage of the cost or charge for a specific service rendered. A copayment is a specified dollar amount for each item or service delivered. While deductibles and coinsurance are rarely used in traditional Medicaid, copayments are applied to some services and groups. The Appendix provides a comparison of the maximum charges allowed for service-related cost-sharing under traditional Medicaid, DRA, and SCHIP. SCHIP is a capped federal grant that allows states to cover low-income, uninsured children in families with income above Medicaid eligibility thresholds. Children may be enrolled in separate SCHIP programs for which SCHIP rules apply (shown in the Appendix ), or in Medicaid, for which traditional Medicaid or DRA rules apply. Some states (e.g., Kentucky) have both types of SCHIP programs (a Medicaid expansion and a separate SCHIP program), for which children with the highest income levels are enrolled in the separate program. Service-related cost-sharing under separate SCHIP programs generally parallels the rules under traditional Medicaid for lower-income subgroups; there are no limits specified for higher-income subgroups. Total SCHIP cost-sharing is capped at 5% of family income per eligibility period. Service-related cost-sharing under traditional Medicaid is prohibited for the following specific groups and services: (1) children under 18, (2) pregnant women for pregnancy-related services, (3) services provided to certain institutionalized individuals, (4) individuals receiving hospice care, (5) emergency services, and (6) family planning services and supplies. For most other groups and services, nominal amounts are allowed. For example, nominal copayments specified in regulations range from $0.50 to $3, depending on the payment for the item or service. These nominal amounts will be increased by medical inflation beginning in 2006 (regulations not yet released). Under the DRA option, certain groups and services are also exempt from the service-related cost-sharing provisions. These exemptions are nearly identical to those under traditional Medicaid. However, under traditional Medicaid, all children under 18 are exempt, while under DRA, only children covered under mandatory eligibility groups (the lowest income categories) and certain foster care/adoption assistance youth are exempt. Also, groups exempted from the general service-related cost-sharing provisions under DRA may nonetheless be subject to cost-sharing for non-emergency services provided in a hospital emergency room (ER), and/or for prescribed drugs (see the Appendix ). Under SCHIP, only American Indian and Alaskan Native children are exempt from cost-sharing, and cost-sharing is also prohibited for well-baby and well-child services. Among the four states with approval for alternative benefit packages via DRA, only Kentucky includes cost-sharing for participants, summarized in Table 1 . For many services across the four Kentucky plans, there is no cost-sharing for beneficiaries. When applicable, copayments for selected non-institutional services, acute inpatient hospital care, and for generic and preferred brand-name drugs are very similar to the maximums allowed under traditional Medicaid. For non-preferred brand-name drugs and for non-emergency care in an ER, a 5% coinsurance charge will be applicable in most cases. For all four Kentucky plans, the maximum annual out-of-pocket expense per member is $225 for health care services and $225 for prescriptions. Additionally, under DRA, the total aggregate amount of all cost-sharing (premiums plus service-related charges) cannot exceed 5% of family income applied on a monthly or quarterly basis as specified by the state. Under Kentucky's DRA SPA, this limit is applied on a quarterly basis. The rules governing consequences for failure to pay premiums differ somewhat under traditional Medicaid and DRA. Under traditional Medicaid, for certain groups of pregnant women and infants for whom monthly premiums may be charged, states cannot require prepayment, but may terminate Medicaid eligibility when failure to pay such premiums continues for at least 60 days. In contrast, under DRA, states may condition Medicaid coverage on the payment of premiums, but like traditional Medicaid, states may terminate Medicaid eligibility only when nonpayment continues for at least 60 days. States can apply this DRA provision to some or all applicable groups. Under both traditional Medicaid and DRA, states may waive premiums in cases of undue hardship. In Kentucky, benefits are terminated after two months of non-payment of premiums for children in the separate SCHIP program. Upon payment of a missed premium, re-enrollment is allowed. After 12 months of non-payment, payment of the missed premium is not required for re-enrollment. Also, working families with transitional Medicaid will lose coverage after two months of missed premiums unless good cause is established. There are more differences between traditional Medicaid and DRA with respect to rules for failure to pay service-related cost-sharing. Under traditional Medicaid, providers cannot deny care to beneficiaries due to an individual's inability to pay a cost-sharing charge. However, this requirement does not eliminate the beneficiary's liability for payment of such charges. In contrast, under DRA, states may allow providers to require payment of authorized cost-sharing as a condition of receiving services. Providers may be allowed to reduce or waive cost-sharing on a case-by-case basis. P.L. 109-432 exempts individuals in families with income below 100% FPL from the DRA failure to pay rules for both premiums and service-related cost-sharing. According to state regulations, Kentucky requires all providers to collect applicable cost-sharing from Medicaid beneficiaries at the time of service delivery or at a later date. No provider can waive cost-sharing, but only pharmacy providers can deny services for failure to pay (as per a state law). Finally, under SCHIP, states must specify consequences applicable to nonpayment of premiums and/or service-related cost-sharing, and must institute disenrollment protections (e.g., providing both reasonable notice and an opportunity to pay policies).

Under traditional Medicaid, states may require certain beneficiaries to share in the cost of Medicaid services, although there are limits on the amounts that states can impose, the beneficiary groups that can be required to pay, and the services for which cost-sharing can be charged. Prior to DRA, changes to these rules required a waiver. DRA provides states with new options for benefit packages and cost-sharing that may be implemented through Medicaid state plan amendments (SPAs) rather than waiver authority. These rules vary by beneficiary income level and for some types of service. The recently enacted P.L. 109-432 (Tax Relief and Health Care Act of 2006) modified the DRA cost-sharing rules. This report describes the new cost-sharing options and recent state actions to implement these provisions, and will be updated as additional activity warrants.

Historically, Congress has mandated programs to help U.S. exporters compete with subsidies provided by other countries, to assist with financing for exports where credit is a constraint, or to promote U.S. agricultural exports. Some in Congress have criticized programs that assist with exports as corporate welfare; others suggest that private entities could and should themselves finance export activities. The 2008 farm bill extends funding authority for credit guarantees and export market development through FY2012. The enacted farm law repeals legislative authority for the major export subsidy program, but extends authority for a smaller program that subsidizes dairy product exports. Funded by using the borrowing authority of the Commodity Credit Corporation (CCC), the farm bill agricultural export programs are administered by the Foreign Agricultural Service (FAS) of the U.S. Department of Agriculture (USDA). CCC export credit guarantees assure payments for commercial financing of the sale of U.S. agricultural exports. If a foreign buyer defaults on the debt financing incurred, the CCC assumes the debt. In the 2002 farm bill ( P.L. 107-171 ) Congress authorized $5.5 billion (in export value, not cost to the Treasury) for such guarantees, plus an additional $1 billion to be made available to countries that are emerging markets. Four CCC export credit guarantee programs were authorized in the 2002 farm bill. GSM-102 guaranteed short-term (up to 3 years) financing of U.S. farm products; GSM-103 guaranteed longer-term (3-10 years) financing. The Supplier Credit Guarantee Program (SCGP) guaranteed very short-term (up to 1 year) financing of exports. The Facilities Financing Guarantee Program (FFGP) guaranteed financing of goods and services exported from the United States to improve or establish agriculture-related facilities in emerging markets. In 2006, FAS suspended operation of the GSM-103 program. The suspension was in response to a WTO dispute panel decision in a case brought by Brazil against U.S. cotton policy. The panel ruled that GSM programs were prohibited export subsidies because they did not recover their operating costs. Also FAS suspended the SCGP in FY2006, largely because of a high rate of defaulted obligations and evidence of fraud. In its farm bill proposals, the Administration requested that Congress formally repeal legislative authorities for GSM-103 and the SCGP. The Administration also requested that Congress lift the statutory 1% cap on loan origination fees for GSM-102,which the WTO cited as a subsidy element in the operation of the export credit guarantee programs. The 2008 farm bill repeals authority for the SCGP, the GSM-103 intermediate credit guarantee, and the 1% cap on loan origination fees for the GSM-102 program. The new farm bill caps the credit subsidy for the program at $40 million annually. The amount of GSM-102 credit that CCC must make available each year is set at not less than $5.5 billion, but the $40 million credit subsidy cap, according to the manager's statement accompanying the bill, is expected to finance $4 billion annually in export credit guarantees. The 2008 farm bill extends authority for the FFGP to FY2012. It also provides that the Secretary of Agriculture may waive requirements that U.S. goods be used in the construction of a facility under this program, if such goods are not available or their use is not practicable. The new law also permits the Secretary to provide a guarantee for this program for the term of the depreciation schedule for the facility, not to exceed 20 years. The 2002 farm bill authorized four programs to promote U.S. agricultural products in overseas markets, including the Market Access Program (MAP), the Foreign Market Development Program (FMDP), the Emerging Markets Program (EMP), and the Technical Assistance for Specialty Crops Program (TASC). Authorization of CCC funds for the market development programs expired with the 2002 farm bill in 2007. During the farm bill debate both the Administration and producers of fruits and vegetables advocated increased funding for export market development programs, targeted to specialty crops (fruits and vegetables). MAP assists primarily value-added products. Its purpose is to expand exports over the long term by undertaking activities such as consumer promotions, technical assistance, trade servicing, and market research. MAP projects are jointly funded by the federal government and industry groups. Trade organizations, nonprofit industry organizations, and private firms that are not represented by an industry group submit proposals for marketing activities to the USDA, which evaluates proposals and selects recipient organizations. The 2008 farm bill extends MAP through FY2012, makes organic produce eligible for the program, and keeps the funding level at the FY2007 level—$200 million—for each of the next five years (FY2008-FY2012). The 2002 farm bill reauthorized CCC funding for FMDP through FY2007 at an annual level of $34.5 million. FMDP, which resembles MAP in most major respects, mainly promotes generic or bulk commodity exports. The 2008 farm bill extends FMDP through FY2012 without change in the funding authorization. EMP provides funding for technical assistance activities intended to promote exports of U.S. agricultural commodities and products to emerging markets in all geographic regions, consistent with U.S. foreign policy. An emerging market is defined in the authorizing legislation (the 2002 farm bill) as any country that is taking steps toward a market-oriented economy through food, agricultural, or rural business sectors of the economy of the country. Additionally, an emerging market country must have the potential to provide a viable and significant market for U.S. agricultural commodities or products. The 2002 farm bill authorized funding at $10 million annually through FY2007. The 2008 farm bill reauthorizes the Emerging Markets Program through FY2012 without change. TASC aims to assist U.S. specialty crop exports by providing funds for projects that address sanitary, phytosanitary, and technical barriers that prohibit or threaten U.S. speciality crop exporters. The 2002 farm bill defined specialty crops as all cultivated plants, and the products thereof, produced in the United States, except wheat, feed grains, oilseeds, cotton, rice, peanuts, sugar, and tobacco. The types of activities covered include seminars and workshops, study tours, field surveys, pest and disease research, and pre-clearance programs. The 2002 farm bill authorized $2 million annually of CCC funds each fiscal year through FY2007 for the TASC program. The 2008 farm bill extends TASC through FY2012 and increases funding to $4 million in FY2008; $7 million in FY2009; $8 million in FY2010; and $9 million in each of FY20011 and FY2012. The 2002 farm bill authorized direct export subsidies of agricultural products through the Export Enhancement Program (EEP) and the Dairy Export Incentive Program (DEIP). Both programs subsidized agricultural exports when U.S. domestic prices were higher than world or international prices. EEP, which mainly subsidized exports of wheat and wheat flour (around 80% of EEP subsidies), has been little used as U.S. and world prices have moved closer together. The last year of significant EEP subsidies was 1995; there were no EEP subsidies during the five years of the 2002 farm bill. DEIP provided subsidies for dairy product exports; no DEIP subsidies have been provided since 2005. Agricultural export subsidies are a major issue in the Doha Round of multilateral trade negotiations, where preliminary agreement has been reached to eliminate them by 2013. The 2008 farm bill repeals legislative authority for EEP, but extends legislative authority for DEIP through December 31, 2012. (The DEIP authorization is in Title I, the Commodities title of the 2008 farm bill.) The 2008 farm bill requires the U.S. Agency for International Development (USAID) to make a contribution on behalf of the United States to the Global Crop Diversity Trust of up to $60 million over five years. U.S. contributions to the trust may not exceed one fourth of the total of funds contributed to the trust from all sources. The Global Diversity Trust is the funding mechanism for the International Treaty on Plant Genetic Resources for Food and Agriculture, which is an international agreement for the conservation, exploration, collection, characterization, evaluation and documentation of plant genetic resources for food and agriculture. The trust, administered by the United Nations Food and Agriculture Organization, (FAO), assists in funding the operation of gene banks held by the countries that are party to the treaty. The 2008 farm bill includes a provision that requires the Secretary of Agriculture, in cooperation with the Secretary of Labor, to develop standards that importers of agricultural products into the United States could choose to use to certify that those products were not produced with the use of abusive forms of child labor. The consultative group would develop recommendations on practices that would enable companies to monitor and verify whether the food products they import are made with the use of child or forced labor.

Agricultural exports, which are forecast by the U.S. Department of Agriculture to reach $108.5 billion in 2009, are an important source of employment, income, and purchasing power in the U.S. economy. Programs that deal with U.S. agricultural exports are a major focus of Title III, the trade title, in the new omnibus farm bill, the Food, Conservation, and Energy Act of 2008 (P.L. 110-246, H.R. 6124). The enacted farm bill repeals the major U.S. export subsidy program, and reauthorizes and changes a number of programs that assist with financing U.S. agricultural exports or that help develop markets overseas. Changes include modifying export credit guarantee programs to conform with U.S. commitments in the World Trade Organization (WTO), making organic products eligible for export market development programs, and increasing the funds available to address sanitary and phytosanitary barriers to U.S. specialty crop exports. International food aid programs are the other major focus of the farm bill trade title. For a discussion of farm bill changes in food aid programs, see CRS Report RS22900, International Food Aid Provisions of the 2008 Farm Bill.

Non-elderly, non-disabled, non-working residents of public housing are subject to a community service and self-sufficiency requirement (referred to as the CSSR or community service requirement). Specifically, all adult residents of a household who are not otherwise exempted are required to participate in eight hours per month of either community service or economic self-sufficiency activities in order to maintain their eligibility for public housing. Exempted residents include those who are 62 years or older; blind or disabled and can certify that they cannot comply with the community service requirement; caretakers of a person with a disability; engaged in work activities; exempt from work activities under the Temporary Assistance for Needy Families program (TANF) or a state welfare program; and/or members of a family in compliance with TANF or a state welfare program's requirements. According to data released by HUD, of the 1.86 million individuals living in public housing, approximately 812,000, or (44%) are potentially subject to the community service requirement. It requires that residents of public housing, unless exempted, participate in eight hours of community service and/or economic self-sufficiency activities per month. PHAs have broad discretion in defining what counts as community service or economic self-sufficiency activities. Allowable activities may include, among others, volunteer work at a local public or nonprofit institution; caring for the children of other residents fulfilling the community service requirements; participation in a job readiness or training program; or attending a two- or four-year college. However, public housing tenants required to fulfill the community service requirements cannot supplant otherwise paid employees of the PHA or other community service organizations. PHAs must review and verify each member of a household's compliance 30 days prior to the end of the household's annual lease. Each nonexempt family member is required to present a signed certification on a form provided by the PHA of CSSR activities performed over the previous 12 months. This form is developed and standardized by the PHA and the submitted form is verified by a third party. In 2016, as a part of a broader set of administrative streamlining actions, HUD began to permit PHAs to adopt policies to allow families to self-certify their compliance with the CSSR, subject to validity testing. If any member of the household fails to comply with the community service requirement, the entire household is considered out of compliance. The tenant must agree to make up the community-service deficit in the following year in order to renew the household's lease through a signed "work-out agreement" with the PHA. If the tenant does not come into compliance, the PHA may not renew the household's lease. However, PHAs may not terminate a household's lease for noncompliance before the lease has expired. Noncompliant tenants may file a grievance to dispute the PHA's decision to terminate tenancy. Each PHA must develop a local policy for administering the community service and economic self-sufficiency requirements and include the policy in its agency plan. PHAs may administer community service activities directly, partner with an outside organization or institution, or provide referrals to tenants for volunteer work or self-sufficiency programs. The community service and economic self-sufficiency requirement applicable to public housing residents originated with the housing reform debates of the 1990s and parallel debates at the time about the role of work and welfare reform. Following several years of legislative effort, in 1997, H.R. 2 , the Housing Opportunity and Responsibility Act of 1997, and S. 462 , the Public Housing Reform and Responsibility Act of 1997, were introduced. They sought to reform HUD's low-income housing programs by consolidating the public housing program into a two-part block grant program; denying occupancy to applicants with a history of drug-related activity; and requiring residents of public housing to meet a community service requirement. The community service and economic self-sufficiency requirement was among the most controversial elements of the sweeping bills. While neither H.R. 2 nor S. 462 became law, a compromise version was enacted as the Quality Housing and Work Responsibility Act of 1998 (QHWRA), Title V of the FY1999 Departments of Veterans Affairs and Housing and Urban Development (VA-HUD) appropriations bill ( H.R. 4194 ), signed into law by then-President Bill Clinton ( P.L. 105-276 ). QHWRA contained many provisions from H.R. 2 and S. 462 , including a version of the community service and economic self-sufficiency requirement. HUD did not issue regulations to implement the community service provisions of QHWRA until March 29, 2000. The regulations took effect beginning on October 1, 2000, and were in effect for just over one year. Language added to the FY2002 VA-HUD appropriations bill ( P.L. 107-73 ), which was enacted in November 2001, prohibited HUD from using any FY2002 funds to enforce the community service and self-sufficiency requirements. The suspension of the provision ended when the FY2003 appropriations bill ( P.L. 108-7 ) was signed into law on February 21, 2003. HUD issued new guidance to the local public housing authorities (PHAs) that administer public housing on June 20, 2003, instructing them to reinstate the community service requirement for public housing residents beginning on August 1, 2003. Following full implementation of the community service requirement, legislation was introduced in several Congresses to repeal the community service requirement, although it was not enacted. As is evident in its legislative and regulatory history, the community service and economic self-sufficiency requirement for residents of public housing has been controversial since its inception. It is consistent with the movement toward required work and self-sufficiency activities that characterized the welfare reform debates of the same era, which culminated in the creation of the Temporary Assistance for Needy Families (TANF) program. Supporters of mandatory work policies have argued that low-income families should earn the benefits or subsidies they are receiving. They have also argued that by compelling families into self-sufficiency activities, such policies can improve the lives of poor families and their children by potentially increasing their incomes. Those who have argued against mandatory work requirements contend that such requirements are paternalistic and do not promote real self-sufficiency, but rather, low-wage work that may not be sustainable. All of these disagreements manifested during debate over the provision, and additional arguments were made specifically for and against the public housing requirement. Proponents of the community service requirement cited concerns about a perceived negative culture at public housing developments and the possibility for the community service requirement to help change that culture. Opponents of the provision argued specifically against the idea of a community service "requirement" for public housing residents, arguing it is akin to the forced community work mandated of criminals. Additionally, critics raised questions about the fairness of applying this requirement only to residents of public housing and not to recipients of Section 8 Housing Choice Vouchers or Section 8 project-based rental assistance, since the programs serve similar populations. During debate over the provision, concerns were repeatedly raised that the community service requirement would be administratively burdensome or an unfunded mandate. Although only a small number of tenants may actually be subject to the community service requirement at a given PHA, the PHA must certify either the participation or exemption status of every resident of public housing. Furthermore, the grievance and/or eviction process for tenants who are found to be noncompliant with the community service requirement may be costly. Industry groups contended that this requirement is an unreasonable burden for PHAs, that, they argue, are chronically under-funded. Some of the opponents of the policy speculated that PHAs would not aggressively implement the provision; rather, they would try to exempt as many families as possible and set a very broad definition of eligible activities in order to avoid costly grievances and evictions and keep administrative burdens low. Differences of opinion were also expressed regarding whether the community service requirement would be complementary to, or duplicative of, the work requirements that had recently been adopted for cash assistance recipients under the Temporary Assistance for Needy Families program. There has also been some controversy surrounding HUD's implementation of the community service requirement. The statute states that in order to meet one of the exemption criteria, tenants must be engaged in work activities, as defined in the Social Security Act. The Social Security Act definition of work activities does not include a minimum number of hours a person must perform the listed activities in order to be considered engaged in work activities. HUD's 2003 Notice to PHAs encouraged them to consider a tenant engaged in work activities, and therefore exempt from the community service requirement, only if they were working at least 30 hours per week. This guidance initially prompted confusion as to whether PHAs were required to set a 30-hour standard. While the guidance states that PHAs are encouraged to set a 30-hour standard, they are not required to set such a standard. In March 2008, HUD's Inspector General released an audit of HUD's implementation and enforcement of the community service requirement. The audit was performed in response to media reports that the community service requirement was rarely enforced. The audit found that HUD did not have adequate controls to ensure that PHAs properly administered the community service requirement, and the audit estimated that at least 85,000 households living in public housing were ineligible as a result of noncompliance with the community service requirement. In response to these findings, in November 2009, HUD published additional guidance to PHAs regarding the administration of the community service requirements. The guidance largely restated existing requirements, although it did provide enhanced guidance on reporting. It also reiterated steps PHAs may take to enforce the community service requirement, as well as steps HUD may take to sanction PHAs for failing to enforce the community service requirement. In February 2015, HUD's Inspector General released a new audit of HUD's implementation and enforcement of the community service requirement. The audit found that HUD subsidized housing for 106,000 units occupied by noncompliant tenants out of nearly 550,000 units potentially subject to the community service requirement nationwide. As a result, the OIG contended that the agency paid more than $37 million in monthly subsidies for public housing units occupied by noncompliant tenants. The audit recommended that the agency develop and implement a written policy for the community service requirement to ensure adequate compliance and create training and further clarified reporting mechanisms. In response to the audit, HUD issued a notice to PHAs on August 13, 2015, with further guidance related to the statutory/regulatory requirements for administering the community service requirement; data collection and reporting requirements; action to take against noncompliant tenants; and penalties against PHAs that do not comply. The notice also provided clarification that HUD has interpreted the statutory exemptions for compliance with the community service requirement to include the Supplemental Nutrition Assistance Program (SNAP). Therefore, if a tenant is a member of a family that receives SNAP, and has been found to be in compliance with SNAP program requirements, then the tenant is exempt from the community service requirement. This clarification is particularly notable because the 2015 OIG report contended that PHAs were incorrectly classifying families as exempt from the community service requirement because of their SNAP participation. Since HUD has now clarified that SNAP families are exempt, the OIG's estimate of the number of noncompliant families is likely overstated to some degree. In August of 2016, HUD published on its website summary data reflecting compliance with the CSS requirement. Those data report that of the 1.86 million people living in public housing, the community service requirement is applicable to 44%, or 812,000 residents. Of those residents to whom the community service requirement applies, approximately 68% are exempt (i.e., are already working, have a disability, etc.). Of the remaining 32% who are not exempt (257,000 residents, or 13% of all people living in public housing), 48% were reported to be in compliance (124,000 individuals, or 7% of all public housing residents), 32% were reported as pending verification by the PHA (83,000 individuals or 4% of all public housing residents), and 19% were reported as being out of compliance (48,000 individuals, or 3% of all public housing residents).

The Quality Housing and Work Responsibility Act of 1998 (P.L. 105-276) included provisions designed to promote employment and self-sufficiency among residents of assisted housing, including a mandatory work or community service requirement for residents of public housing. Non-elderly, non-disabled, non-working residents of public housing are required to participate in eight hours per month of either community service or economic self-sufficiency activities in order to maintain their eligibility for public housing. The community service requirement has been controversial since its inception. Supporters of the provision believe that it is consistent with the goals of welfare reform and that it will promote civic engagement and "giving back" among residents of public housing; detractors argue that it is punitive, unfairly applied, and administratively burdensome. In February 2015, the Department of Housing and Urban Development (HUD) Inspector General released an audit critical of HUD's implementation and enforcement of the community service requirement. In response to the report, HUD issued further guidance in August 2015 related to the statutory/regulatory requirements for administering the community service requirement; data collection and reporting requirements; action to take against noncompliant tenants; and penalties against PHAs that do not comply. Recent HUD data indicate that approximately 14% of public housing residents are subject to the community service requirement and not otherwise exempt. Of those nonexempt residents, approximately 19% were reported as noncompliant (or about 3% of all public housing residents).

Changing economic, social, and political conditions at home and abroad have led some analysts to question whether the United States will remain globally competitive in the coming decades. The possibility that the United States has lost or could lose its historical advantages in scientific and technological advancement—and the prosperity and security attributed to that advancement—has become a primary rationale for a portfolio of otherwise disparate federal programs, policies, and activities. Sometimes identified as "innovation" or "competitiveness" policy, these programs, policies, and activities address research and development, education, workforce development, tax, patent, immigration, economic development, telecommunications, or other policy issues perceived as critical to the U.S. scientific and technological enterprise. The 2007 America COMPETES Act ( P.L. 110-69 ) is an example of this type of policymaking. Designed to "invest in innovation through research and development, and to improve the competitiveness of the United States," the law authorized $32.7 billion in appropriations between FY2008 and FY2010 for programs and activities in physical sciences and engineering research and in science, technology, engineering, and mathematics (STEM) education. Congress reauthorized certain provisions of P.L. 110-69 —including funding for physical sciences and engineering research and STEM education—when it passed the America COMPETES Reauthorization Act of 2010 ( P.L. 111-358 ). The 2010 COMPETES Act authorized $45.5 billion in appropriations between FY2011 and FY2013. Given the pivotal role that funding levels played in the design, implementation, and congressional debate about the COMPETES Acts, policymakers have paid close attention to trends in these accounts. This report, which was written to aid Congress in tracking these trends, includes two tables summarizing authorization levels and funding for selected COMPETES-related accounts across both authorization periods (i.e., FY2008 to FY2010 and FY2011 to FY2013). Readers interested in an analysis of the COMPETES Acts and related policy issues are referred to the following publications: CRS Report R41819, Reauthorization of the America COMPETES Act: Selected Policy Provisions, Funding, and Implementation Issues , by [author name scrubbed]. CRS Report R42642, Science, Technology, Engineering, and Mathematics (STEM) Education: A Primer , by [author name scrubbed] and [author name scrubbed]. CRS Report R42470, An Analysis of STEM Education Funding at the NSF: Trends and Policy Discussion , by [author name scrubbed]. CRS Report R41951, An Analysis of Efforts to Double Federal Funding for Physical Sciences and Engineering Research , by [author name scrubbed] CRS Report R43061, The U.S. Science and Engineering Workforce: Recent, Current, and Projected Employment, Wages, and Unemployment , by [author name scrubbed] This report has been updated to reflect FY2009 to FY2013 final funding for COMPETES-related accounts.

Changing economic, social, and political conditions at home and abroad have led some analysts to question whether the United States will remain globally competitive in the coming decades. In response to these and closely related concerns, Congress enacted the 2007 America COMPETES Act (P.L. 110-69), as well as its successor, the America COMPETES Reauthorization Act of 2010 (P.L. 111-358). These acts were broadly designed to invest in innovation through research and development and to improve U.S. competitiveness. More specifically, the acts authorized increased funding for certain physical science and engineering research accounts and STEM (science, technology, engineering, and mathematics) education activities. Congressional debate about the COMPETES Acts focuses closely on authorized and appropriated funding levels. To aid this debate, this CRS report tracks accounts and activities authorized by the 2007 and 2010 COMPETES Acts during each act's authorization period. It includes only those accounts and activities for which the acts provide a defined (i.e., specific) appropriations authorization. Table 1 includes FY2008 to FY2010 authorizations and final funding for accounts in the 2007 COMPETES Act; Table 2 includes FY2011 to FY2013 authorizations and final funding for accounts in the 2010 COMPETES Act.

RS21324 -- Iraq: A Compilation of Legislation Enacted and Resolutions Adopted by Congress, 1990-2003 Updated March 27, 2003 House H.J.Res. 658 Supported the actions taken by the President with respect to Iraqi aggression against Kuwait and confirmed United States resolve. Passed in the House: October 1, 1990 H.Con.Res. 382 Expressed the sense of the Congress that the crisis created by Iraq's invasion and occupation of Kuwait must be addressed and resolved on its own terms separately from otherconflicts in the region. Passed in the House: October 23, 1990 Senate S.Res. 318 Commended the President for his actions taken against Iraq and called for the withdrawal of Iraqi forces from Kuwait, the freezing of Iraqi assets, the cessation of all armsshipments to Iraq, and the imposition of sanctions against Iraq. Passed in the Senate: August 2, 1990 Public Laws P.L. 101-509 ( H.R. 5241 ). Treasury, Postal Service, and General Government Appropriations Act FY1991 (Section 630). Urged the President to ensure that coalition allies were sharing theburden of collective defense and contributing financially to the war effort. Became public law: November 5, 1990 P.L. 101-510 ( H.R. 4739 ). Defense Authorization Act FY1991 (Section 1458). Empowered the President to prohibit any and all products of a foreign nation which has violated the economicsanctions against Iraq. Became public law: November 5, 1990 P.L. 101-513 ( H.R. 5114 ). The Iraq Sanctions Act of 1990 (Section 586). Imposed a trade embargo on Iraq and called for the imposition and enforcement of multilateral sanctions inaccordance with United Nations Security Council Resolutions. Became public law: November 5, 1990 P.L. 101-515 ( H.R. 5021 ). Department of Commerce, Justice, and State Appropriations Act FY1991 (Section 608 a & b). Restricted the use of funds to approve the licensing for export of anysupercomputer to any country whose government is assisting Iraq develop its ballistic missile program, or chemical,biological, and nuclear weapons capability. Became public law: November 5, 1990 Public Laws P.L. 102-1 ( H.J.Res. 77 ). Authorization for Use of Military Force Against Iraq Resolution . Gave congressional authorization to expel Iraq from Kuwait in accordance with United NationsSecurity Council Resolution 678, which called for the implementation of eleven previous Security CouncilResolutions. Became public law: January 12, 1991 P.L. 102-138 ( H.R. 1415 ). The Foreign Relations Authorization Act for FY1992 (Section 301). Stated that the President should propose to the Security Council that members of the Iraqiregime be put on trial for war crimes. Became public law: October 28, 1991 P.L. 102-190 ( H.R. 2100 ). Defense Authorization Act for FY1992 (Section 1095). Supported the use of "all necessary means to achieve the goals of United Nations Security CouncilResolution 687 as being consistent with the Authorization for Use of Military Force Against Iraq Resolution ( P.L.102-1 )." Became public law: December 5, 1991 Public Laws P.L. 103-160 ( H.R. 2401 ). Defense Authorization Act FY1994 (Section 1164). Denied defectors of the Iraqi military entry into the United States unless those persons had assisted U.S. orcoalition forces and had not committed any war crimes. Became public law: November 30, 1993 P.L. 103-236 ( H.R. 2333 ). Foreign Relations Authorization Act FY1994, 1995 (Section 507). Expressed the sense of Congress that the United States should continue to advocate themaintenance of Iraq's territorial integrity and the transition to a unified, democratic Iraq. Became public law: April 30, 1994 House H.Res. 120 Urged the President to take "all appropriate action" to secure the release and safe exit from Iraq of American citizens William Barloon and David Daliberti, who had mistakenlycrossed Iraq's border and were detained. Passed in the House: April 3, 1995 Senate S.Res. 288 Commended the military action taken by the United States following U.S. air strikes in northern Iraq against Iraqi radar and air defense installations. This action was taken duringthe brief Kurdish civil war in 1996. Passed in the Senate: September 5, 1996 House H.Res. 322 Supported the pursuit of peaceful and diplomatic efforts in seeking Iraqi compliance with United Nations Security Council Resolutions regarding the destruction of Iraq'scapability to deliver and produce weapons of mass destruction. However, if such efforts fail, "multilateral militaryaction or unilateral military action should be taken." Passed in the House: November 13,1997 H.Con.Res.137 Expressed concern for the urgent need of a criminal tribunal to try members of the Iraqi regime for war crimes. Passed in the House: January 27, 1998 H.Res. 612 Reaffirmed that it should be the policy of the United States to support efforts to remove the regime of Saddam Hussein in Iraq and to promote the emergence of a democraticgovernment to replace that regime. Passed in the House: December 17, 1998 Senate S.Con.Res. 78 Called for the indictment of Saddam Hussein for war crimes. Passed in the Senate: March 13, 1998 Public Laws P.L. 105-174 ( H.R. 3579 ). 1998 Supplemental Appropriations and Rescissions Act (Section 17). Expressed the sense of Congress that none of the funds appropriated or otherwise madeavailable by this act be used for the conduct of offensive operations by the United States Armed Forces against Iraqfor the purpose of enforcing compliance with United Nations Security CouncilResolutions, unless such operations are specifically authorized by a law enacted after the date of the enactment ofthis act. Became public law: May 1, 1998 P.L. 105-235 ( S.J.Res. 54 ). Iraqi Breach of International Obligations . Declared that by evicting weapons inspectors, Iraq was in "material breach" of its cease-fire agreement. Urged thePresident to take "appropriate action in accordance with the Constitution and relevant laws of the United States, tobring Iraq into compliance with its international obligations." Became public law:August 14, 1998 P.L. 105-338 ( H.R. 4655 ). Iraq Liberation Act of 1988 (Section 586). Declared that it should be the policy of the United States to "support efforts" to remove Saddam Hussein from power inIraq and replace him with a democratic government. Authorized the President to provide the Iraqi democraticopposition with assistance for radio and television broadcasting, defense articles and militarytraining, and humanitarian assistance. Became public law: October 31, 1998 House H.J.Res. 75 Stated that Iraq's refusal to allow weapons inspectors was a material breach of its international obligations and constituted "a mounting threat to the United States, its friends andallies, and international peace and security." Passed in the House: December 20, 2001 Public Laws P.L. 107-243 ( H.J.Res. 114 ). To Authorize the Use of United States Armed Forces against Iraq . Authorized the President to use armed force to defend the national security of the United Statesagainst the threat posed by Iraq and to enforce all relevant U.N. resolutions regarding Iraq. Became public law:October 16, 2002 House H.Con.Res. 104 Expresses the unequivocal support and appreciation of the nation (1) to the President as Commander-in-Chief for his firm leadership and decisive action in the conduct ofmilitary operations in Iraq as part of the on-going Global War on Terrorism; (2) to the members of the U.S. armedforces serving in Operation Iraqi Freedom, who are carrying out their missions withexcellence, patriotism, and bravery; and (3) to the families of the U.S. military personnel serving in Operation IraqiFreedom, who are providing support and prayers for their loved ones currently engagedin military operations in Iraq. Passed in the House: March 21, 2003. Senate S.Res. 95 Commends and supports the efforts and leadership of the President, as Commander in Chief, in the conflict against Iraq. Commends, and expresses the gratitude of the nation to allmembers of the U.S. armed forces (whether on active duty, in the National Guard, or in the Reserves) and thecivilian employees who support their efforts, as well as the men and women of civiliannational security agencies who are participating in the military operations in the Persian Gulf region, for theirprofessional excellence, dedicated patriotism, and exemplary bravery. Expresses the deepcondolences of the Senate to the families of brave Americans who have lost their lives in this noble undertaking,over many years, against Iraq. Expresses sincere gratitude to British Prime Minister TonyBlair and his government for their courageous and steadfast support, as well as gratitude to other allied nations fortheir military support, logistical support, and other assistance in the campaign againstSaddam Hussein's regime. Passed in the Senate: March 20, 2003. For a complete list of 108th legislation related to Iraq that has been proposed in either the House or the Senate, please see Iraq - U.S. Confrontation: Legislation in the 108th Congress (3) available online at http://www.crs.gov/products/browse/iraqleg.shtml .

This report is a compilation of legislation on Iraq from 1990 to the present. The list is composed of resolutions and public laws relating to military action ordiplomatic pressure to be taken against Iraq. (1) Thelist does not include foreign aid appropriations bills passed since FY1994 that deny U.S. funds to any nation inviolation of the United Nations sanctionsregime against Iraq. (2) Also, measures that were not passed only in either the House or the Senate are not included (with the exceptionof the proposals in the 108th Congress and several relevant concurrentand joint resolutions from previous Congresses ). For a more in-depth analysis of U.S. action against Iraq, see CRS Issue Brief IB92117, Iraq, Compliance, Sanctions and U.S. Policy. This report will beupdated periodically.

RS21664 -- The WTO Cancún Ministerial November 6, 2003 The new round of trade negotiations, the Doha Development Agenda (DDA), was launched at the 4th WTO Ministerial at Doha, Qatar in November 2001. It isknown as the Doha Development Agenda because of its emphasis on integrating developing countries into theworld trading system. Many developingcountries believed they have received little or no benefit from those trade negotiations over the years. The workprogram for DDA folded in continuing talks(the built-in agenda) on agriculture and services. Other negotiations were launched on the reduction or eliminationof non-agricultural (industrial) tariffs,clarification and improvement of disciplines for existing WTO agreements on antidumping and subsidies, and topicsrelating to special and differential (S&D)treatment for developing countries and assistance to developing countries with the implementation of existing WTOcommitments. Trade ministers at Dohaagreed to continue discussions on whether to launch negotiations "by explicit consensus" on the "Singapore issues"at the 5th Ministerial at Cancún. The DohaMinisterial declaration also directed negotiators to resolve a dispute related to the ability of least developed countriesto access generic medicines for HIV/AIDSand other epidemics. Trade ministers at Doha directed that the negotiations conclude not later than January 1, 2005with a mid-term review at the 5thMinisterial. Negotiations proceeded at a slow pace. Several deadlines for agreement on negotiating modalities (i.e., methodologies by which negotiations are conducted)were missed in the agriculture and industrial market access talks. Without agreement, negotiators looked towardthe Cancún Ministerial to resolve themodalities. In the weeks before Cancún, negotiating documents to achieve this resolution were criticizedby all sides, and expectations of the Ministerial werereduced to achieving an agreement on the framework for the modalities to be used in future negotiations. Access to Medicines. Negotiators did resolve the access to medicines dispute just prior to the beginning ofthe Ministerial. On August 30, 2003, the Trade Related Aspects of Intellectual Property Rights (TRIPS) Councilagreed on a mechanism to allow poordeveloping countries to issue a compulsory license to a third-country producer to manufacture generic drugs tocombat HIV/AIDS, malaria, tuberculosis, andother epidemics. While the agreement contained several restrictions to protect the patent rights of pharmaceuticalmanufacturers, the agreement was designedin part to reaffirm the importance of developing country issues to the WTO in time for Cancún. (1) At the Cancún Ministerial, negotiators became embroiled in disputes over agriculture and the Singapore issues. The negotiations were characterized by theemergence of the G-20+, an informal group of developing countries (2) which demanded substantial concessions from developed countries in the agriculturenegotiations. Some developing countries also refused to countenance the beginning of negotiations over theSingapore issues, which had been championed bythe European Union (EU). In the end, the Singapore issues broke up the talks before agriculture issues were evenformally discussed. Reaction. Subsequent to the collapse of the talks, U.S. and EU negotiators criticized both the substance andtactics of the G-20+ group. A U.S. negotiator claimed that developing country rhetoric was more suited to the UnitedNations, while others claimed that theG-20+ lacked a negotiating strategy other than making demands on developed countries. However, one G-20+ trademinister has suggested that the position ofthe G-20+ merely represented the paramount interest of its members in breaking down the agricultural barriers andsubsidies in the United States and the EU. U.S. reaction to the collapse of the talks has been to give increased emphasis to the negotiation of bilateral and regional free trade agreements (FTA). U.S. TradeRepresentative Robert Zoellick said that the United States would negotiate with what he called "can-do" countriesrather than "won't-do" countries. (3) Therewere also calls by some Members of Congress to oppose bilateral or regional negotiations with countries of theG-20+, leading some G-20+ participantsnegotiating FTAs with the United States, including Guatemala, Costa Rica, Peru, Colombia, and Thailand, todissociate themselves from their G-20+activities. (4) The European Union has undertaken a review of its policy towards the WTO and multilateral trade negotiations. One issue that may be discussed in this reviewis the future emphasis that the EU places on the Singapore issues. While EU negotiators agreed to drop demandsthat negotiations proceed on all but the tradefacilitation issue at Cancún, the lack of agreement on that agenda may result in renewed EU insistence onthe full Singapore agenda. The EU may also decide toplay the regional card by placing renewed emphasis on ongoing negotiations with Mercosur or with former coloniesin the African, Caribbean and PacificGroup. EU officials have also made public statements on the need to reform various aspects of the WTO'sdecision-making process. (5) Some participants from G-20+ countries returned from Cancún claiming the outcome was a victory for developing countries. To them, the lack of agreementwas evidence that they had successfully defended their national interests in demanding changes in the agriculturalpolicies of developed countries. However,many of these countries have subsequently expressed an interest in returning to WTO negotiations. Some G-20+members, possibly under pressure from theUnited States, have announced that they will no longer attend G-20+ meetings. These defections have called intoquestion the future of this group as anegotiating entity, as well as underlying differences between the trade policies of some of its members, most notablyBrazil and India. The Derbez Draft. During the course of the Cancún Ministerial, a draft declaration (6) was written by theMinisterial Chairman, Luis Ernesto Derbez, the Mexican Foreign Minister. Crafted as a framework for futurenegotiations to which all parties could agree, itwas criticized by most parties and was not adopted at the Ministerial. The Derbez text principally modified theagricultural language of a draft negotiating textcirculated, and widely criticized, prior to the negotiations. It did call for the start of negotiations on two of theSingapore issues, trade facilitation andgovernment procurement, while relegating the issues of investment and competition policy to further "clarification." In the aftermath of the Conference,however, the Derbez text has reemerged as a possible negotiation vehicle to restart the negotiations. It has beenendorsed by leaders of the Asia-PacificEconomic Cooperation (APEC) nations, including the United States, Canada and Japan. Brazil has also indicatedthat it could work from the text, although itdisagrees with certain language in the draft. The European Union has not taken a formal position on the Derbezdraft, although EU Trade Representative PascalLamy wondered in a recent speech in London, "what magic dust has been shaken over a text so roundly rejected inSeptember, to find it so roundly endorsed inNovember." (7) Only India has rejected the textoutright as a basis for negotiation. (8) While the Derbez draft provides the advantage of a ready-made template to restart the negotiations, this approach also has potential shortcomings. As acompromise text that essentially revised a previous compromise text, the language is highly general, and in manyrespects represents a lowest commondenominator of agreement. Many of the previous disagreements could reemerge if negotiations commence basedon this text. The Derbez text also reflects thejoint negotiating positions worked out between the United States and the EU in agriculture and industrial marketaccess. Post-Cancún, some U.S. commentatorshave suggested that these positions do not serve U.S. interests, and that the United States would be better servedby reverting to its previous, more ambitious,negotiating proposals. Agriculture. (9) Agriculture negotiations are part of the ongoing negotiations, a built-in agenda of talks thatwere incorporated into the launch of the Doha round. The negotiations involve the "three pillars" of agriculturesupport: market access (tariffs), exportsubsidies, and production subsidies. The emphasis of the U.S. negotiating position has been market access. Theinitial U.S. agriculture proposal includedsignificant tariff reduction based on a non-linear formula that would cap individual tariff lines at 25%. The proposalalso called for a complete elimination ofexport subsidies and a harmonization of trade-distorting domestic support to 5% of a country's total agriculturalproduct. The initial European Union proposal adopted a linear formula approach to tariff reductions and subsidies used in the Uruguay Round. The linear approachwould reduce tariffs and subsidies by a fixed percentage cut, thus leaving the relative subsidy and tariff ratesunchanged between trading partners. The EU alsosought to trade concessions on export subsidies, which it heavily utilizes, for concessions on export credit and foodaid programs, which are utilized by theUnited States. In June 2003, the EU announced a series of reforms to its Common Agricultural Policy (CAP)including the partial decoupling of mostproduction from subsidies by 2007. However, the EU did not revise its agriculture offer based on these reforms. In August 2003, the United States and the EU adopted a joint negotiating framework to spur negotiations in the lead-up to the Cancún Ministerial. Thecompromise text blended various aspects of the U.S. and EU proposals. It provides for a combination of harmonizedand linear tariff reduction formulas. Trade-distorting domestic support would be reduced by a percentage formula, and production-limited support wouldbe allowed up to 5% of the value of the country's total agricultural production. Export subsidies would be phased out for products of interest to developingcountries, and WTO disciplines would bedeveloped for state trading enterprises, export credits, and food aid programs. special and differential treatment(S&D) was recognized for developingcountries, but not necessarily for developing countries that are net food exporters. Some observers have criticizedthe United States for moving away from itsinitial trade liberalizing stance to compromise with the EU, claiming that the initial U.S. position had been morecompatible with certain developing countryproposals. (10) However, others contend that acoherent U.S.-EU position would help facilitate negotiations. In response to the U.S. - EU proposal, the G-20+ group advocated a proposal to cut U.S. and EU domestic subsidies more drastically than the U.S.-EU proposal,to eliminate export subsidies, and to provide S&D treatment for all developing countries in terms of tariffreduction and other market access. In addition, agroup of four African nations, Benin, Burkina Faso, Chad, and Mali proposed the elimination of trade-distortingdomestic support and export subsidies forcotton coupled with a transitional compensation mechanism for cotton exporters affected by the subsidies. Inresponse, the United States proposed a WTOsectoral initiative to examine trade distortions for cotton, man-made fibers, and textile and apparel with multilateralassistance to help these countries diversifytheir economies away from cotton. African countries refused to negotiate on this basis. The Derbez draft tried to reconcile these different positions by advocating deeper cuts in trade-distorting domestic subsidies, bringing under reviewnon-trade-distorting subsidies, and by negotiating a date for the elimination of export subsidies, positions that reflectprevious developing country negotiatingpositions. It followed the U.S.-EU tariff formula, which blended harmonized and linear tariffs, but alloweddeveloping countries to identify items for minimaltariff cuts. It also largely adopted the U.S. position paper on the cotton issue. Singapore Issues. The Singapore issues refer to four issues (investment, competition policy, tradefacilitation, and government procurement) that were offered for the negotiating agenda of the WTO by theEuropean Union at the 1st Ministerial, held inSingapore in 1996. The 2001 Doha Ministerial declaration called for a decision on negotiating the issues "by explicitconsensus" at the 5th Ministerial. The 5thMinisterial at Cancún did not provide explicit consensus to negotiate these items. According to reports, itwas an impasse over these issues that finally causedthe talks to collapse. The European Union, along with Japan, South Korea, and Taiwan, have been the principal proponents of the Singapore issues. Tactically, it is generallyaccepted that for them, negotiation of the Singapore issues would be a quid pro quo for substantive negotiation ontheir agriculture policies. The United Stateshas been ambivalent about the Singapore issues, recently supporting the inclusion of government procurement andtrade facilitation primarily to move thenegotiations along. Generally, the developing countries have been opposed to the negotiation of the Singapore issuesfor two reasons. First, they foresee theimplementation of multilateral rules on these issues as an infringement of their sovereignty. Second, manydeveloping countries claim not to have theinstitutional capacity or resources to undertake the negotiation of additional issues, whatever the merits. TheDerbez text proposed the inclusion of tradefacilitation and government procurement. In the final outcome, the EU was willing to drop all the issues save tradefacilitation, the consideration of which wasthen vetoed by Botswana backed by several other African states. Before the talks broke, however, South Koreaindicated that it would accept nothing less thannegotiations on all four issues. Industrial Market Access. The United States has favored an aggressive tariff-cutting negotiating strategy inthe industrial market access talks. In December 2002, the United States proposed the complete elimination of tariffsby 2015. This proposal would haveeliminated "nuisance" tariffs (tariffs below 5%) and certain industrial sector tariffs by 2010, and would haveremoved remaining tariffs in 5 equal increments by2015. The initial EU tariff reduction proposal relied on a "compression formula," one in which all tariffs arecompressed in four bands with the highest bandbeing 15%. Like the U.S. position, this proposal applied to all countries and did not contain S&D language. The United States generally has been opposed toweakening the concept of tariff reciprocity, maintaining that it is in the developing countries' own interest to lowertariffs, not least to promote trade betweendeveloping countries. A paper jointly proposed by the United States, Canada, and the European Union proposeda harmonization (i.e. non-linear) formula fortariff reduction. This joint paper did contain S&D language for developing countries in the form of creditsawarded for further liberalization activity. (11) Industrial market access did not receive the attention paid to agriculture or Singapore issues. Because there was no agreement on modalities prior to theMinisterial, the Derbez text only reaffirmed the use of an unspecified non-linear formula applied line-by-line thatprovides flexibilities for developingcountries. The text also supported the concept of sectoral tariff elimination as a complementary modality for tariffreduction on goods of particular exportinterest to developing countries, but it advanced no concrete proposal. Next Steps. Following the collapse of the Cancún talks, all negotiating group meetings were cancelled. TheWTO General Council chairman Perez del Castillo has entered into discussion with national trade ministers andtheir Geneva representatives to try to establisha consensus on the way forward in the negotiations. To date, the United States and the EU have declined to takea leadership role in these discussions. TheGeneral Council, the WTO's highest decision-making body, is scheduled to meet on December 15, 2003, to assessany progress resulting from these discussionand recommend further steps.

The Cancún Ministerial Conference of the World Trade Organization(WTO)broke up without reaching agreementon the course of future multilateral trade negotiations. Negotiations on the Doha Development Agenda haveproceeded at a slow pace since the launch of thenew round in November 2001. The immediate cause of the collapse of talks was disagreement over launchingnegotiations on the Singapore issues, butagriculture and industrial market access issues were also sources of contention. Reaction from the United States hasbeen to focus on regional and bilateraltalks, while the European Union has undertaken a policy review of its position towards the WTO. The talks werecharacterized by the emergence of the G-20+group of developing nations that sought deep cuts in developed country agricultural subsidies. This report will notbe updated.

Since the terrorist attacks on September 11, 2001, the Islamic schools known as madrasa s have been of increasing interest to analysts and to officials involved in formulating U.S. foreign policy toward the Middle East, Central Asia, and Southeast Asia. Madrasas drew added attention when it became known that several Taliban leaders and Al Qaeda members had developed radical political views at madrasas in Pakistan, some of which allegedly were built and partially financed by donors in the Persian Gulf states. These revelations have led to accusations that madrasas promote Islamic extremism and militancy, and are a recruiting ground for terrorism. Others maintain that most of these religious schools have been blamed unfairly for fostering anti-U.S. sentiments and argue that madrasas play an important role in countries where millions of Muslims live in poverty and state educational infrastructure is in decay. The Arabic word madrasa (plural: madaris ) generally has two meanings: (1) in its more common literal and colloquial usage, it simply means "school"; (2) in its secondary meaning, a madrasa is an educational institution offering instruction in Islamic subjects including, but not limited to, the Quran, the sayings ( hadith ) of the Prophet Muhammad, jurisprudence ( fiqh ), and law. Historically, madrasas were distinguished as institutions of higher studies and existed in contrast to more rudimentary schools called kuttab that taught only the Quran. Recently, "madrasa" has been used as a catchall by many Western observers to denote any school—primary, secondary, or advanced—that promotes an Islamic-based curriculum. In many countries, including Egypt and Lebanon, madrasa refers to any educational institution (state-sponsored, private, secular, or religious). In Pakistan and Bangladesh, madrasa commonly refers to Islamic religious schools. This can be a significant semantic marker, because an analysis of "madrasa reform" could have different implications within various cultural, political, and geographic contexts. Unless otherwise noted in this paper, the term madrasa refers to Islamic religious schools at the primary and secondary levels. As an institution of learning, the madrasa is centuries old. One of the first established madrasas, called the Nizamiyah , was built in Baghdad during the eleventh century A.D. Offering food, lodging, and a free education, madrasas spread rapidly throughout the Muslim world, and although their curricula varied from place to place, it was always religious in character because these schools ultimately were intended to prepare future Islamic religious scholars ( ulama ) for their work. In emphasizing classical traditions in Arabic linguistics, teachers lectured and students learned through rote memorization. During the nineteenth and early twentieth centuries, in the era of Western colonial rule, secular institutions came to supersede religious schools in importance throughout the Islamic world. However, madrasas were revitalized in the 1970s with the rising interest in religious studies and Islamist politics in countries such as Iran and Pakistan. In the 1980s, madrasas in Afghanistan and Pakistan were allegedly boosted by an increase in financial support from the United States, European governments, Saudi Arabia, and other Persian Gulf states all of whom reportedly viewed these schools as recruiting grounds for anti-Soviet mujahedin fighters. In the early 1990s, the Taliban movement was formed by Afghan Islamic clerics and students ( talib means "student" in Arabic), many of whom were former mujahedin who had studied and trained in madrasas and who advocated a strict form of Islam similar to the Wahhabism practiced in Saudi Arabia and other Gulf countries. Madrasas, in most Muslim countries today, exist as part of a broader educational infrastructure. The private educational sector provides what is considered to be a quality Western-style education for those students who can afford high tuition costs. Because of their relatively lower costs, many people turn to state schools, where they exist. However, in recent years and in more impoverished nations, the rising costs and shortages of public educational institutions have encouraged parents to send their children to madrasas. Supporters of a state educational system have argued that the improvement of existing schools or the building of new ones could offer a viable alternative to religious-based madrasas. Others maintain that reforms should be institutionalized primarily within Islamic madrasas in order to ensure a well-rounded curriculum at these popular institutions. The U.S. Agency for International Development's (USAID) 2003 strategy paper Strengthening Education in the Muslim World advocates both of these viewpoints. Although some madrasas teach secular subjects, in general madrasas offer a religious-based curriculum, focusing on the Quran and Islamic texts. Beyond instruction in basic religious tenets, some argue that a small group of radicalized madrasas, specifically located near the Afghanistan-Pakistan border, promote a militant form of Islam and teach their Muslim students to fight nonbelievers and stand against what they see as the moral depravity of the West. Other observers suggest that these schools are wholly unconcerned with religious scholarship and focused solely on teaching violence. The 2003 USAID strategy paper described links between madrasas and extremist Islamic groups as "rare but worrisome," but also added that "access to quality education alone cannot dissuade all vulnerable youth from joining terrorist groups." Other concerns surround more moderate ("quietist") schools, in which students may be instructed to reject "immoral" and "materialistic" Western culture. The static curricula and dated pedagogical techniques, such as rote memorization, used in many quietist schools may also produce individuals who are neither skilled nor prepared for the modern workforce. Defenders of the madrasa system view its traditional pedagogical approach as a way to preserve an authentic Islamic heritage. Because most madrasa graduates have access only to a limited type of education, they commonly are employed in the religious sector as prayer leaders and Islamic scholars. Authorities in various countries are considering proposals for introducing improved science and math content into madrasas' curricula, while preserving the religious character of madrasa education. Madrasas offer a free education, room, and board to their students, and thus they appeal to impoverished families and individuals. On the whole, these religious schools are supported by private donations from Muslim believers through a process of alms-giving known in Arabic as zakat . The practice of zakat—one of the five pillars of the Islamic faith—prescribes that a fixed proportion of one's income be given to specified charitable causes, and traditionally a portion of zakat has endowed religious education. Almost all madrasas are intended for educating boys, although there are a small number of madrasas for girls. In recent years, worldwide attention has focused on the dissemination of donations to Islamic charities and the export of conservative religious educational curricula by governments and citizens in the Persian Gulf. Concern has been expressed over the spread of radical Islam through schools, universities, and mosques that have received donations and curricular material from Persian Gulf governments, organizations, and citizens. These institutions exist around the world, including South, Central, and Southeast Asia, the Middle East and North Africa, sub-Saharan Africa, western Europe, and the United States. Some view the teaching of religious curricula informed by Islamic traditions common in the Gulf as threatening the existence of more moderate beliefs and practices in other parts of the Muslim world. However, some argue that a differentiation should be made between funding to support charitable projects, such as madrasa-building, and funding that has been channeled, overtly or implicitly, to support extremist teachings in these madrasas. Critics of Gulf states' policies have alleged that Persian Gulf governments long permitted or encouraged fund raising by charitable Islamic groups and foundations linked to Al Qaeda. Several Gulf states have strengthened controls on the activities of charities engaged in overseas activities, including madrasa building and administration. Several Islamic charitable organizations based in Gulf states continue to provide assistance to educational projects across the Muslim world, and channels of responsibility between donors and recipients for curricular development and educational control are often unresolved or unclear. Hosting over 12,000 madrasas, Pakistan's religious and public educational infrastructure are of ongoing concern in the United States. In an economy that is marked by extreme poverty and underdevelopment, costs associated with Pakistan's cash-strapped public education system have led some Pakistanis to turn to madrasas for free education, room, and board. Others favor religious education for some of their children, whose siblings may be encouraged to pursue other professions. Links between Pakistani madrasas and the ousted Afghan Taliban regime, as well as alleged connections between some madrasas and Al Qaeda, have led some observers to consider the reform of Pakistan's madrasa system as an important counterterrorism tool and a means of helping to stabilize the Afghan government. In recommending increased U.S. attention to "actual or potential terrorist sanctuaries," the 9/11 Commission's final report singled out "poor education" in Pakistan as "a particular concern," citing reports that some madrasas "have been used as incubators for violent extremism." In September 2006, Afghan president Hamid Karzai called on Pakistan to do more to prevent the use of madrasas by extremists and terrorists. These reports received new and more urgent attention following reports that one of the four suicide bombers that carried out the July 2005 terrorist attacks on the London transportation system had spent time at a Pakistani madrasa with alleged links to extremists. In response, Pakistani authorities renewed plans to require all madrasas to register with the government and provide an account of their financing sources. The government had previously offered incentives to madrasas that agreed to comply with registration procedures, including better training, salaries, and supplies. Madrasa leaders reportedly agreed to the registration and financial accounting requirements in September 2005, but succeeded in preserving an anonymity provision for their donors. As of January 2007, over 12,000 of Pakistan's estimated 13,000 madrasas had registered with authorities. In a more controversial step, the Pakistani government also demanded that madrasas expel all of their foreign students by December 31, 2005. Of an estimated 1,700 foreign madrasa students, 1,000 had reportedly left Pakistan by January 1, 2006. In August 2006, Pakistani authorities announced their intent to deport some of the remaining 700 foreign students if they did not obtain permission to remain in Pakistan from their home governments: the visas of those with permission reportedly were extended. Some nationalist and Islamist groups have resisted the government's enforcement efforts, and authorities have made statements indicating that they do not plan to use force or shut down noncompliant madrasas in order to enforce the directives. An air-strike on a madrasa near the border with Afghanistan in the Bajaur tribal region killed 80 reported militants on October 30, 2006, and sparked massive protests across Pakistan. In July 2007, Pakistani security forces raided a girls madrasa related to the conservative Red Mosque after individuals affiliated with the facilities refused government orders to stop vigilante enforcement of religious social codes. Over 100 people were reportedly killed in related clashes. In September 2007, the U.S. Department of State reported in its annual religious freedom report that "in recent years many [Pakistani] madrasas have taught extremist doctrine in support of terrorism." The report identified "unregistered and Deobandi-controlled madrasas in the Federally Administered Tribal Areas (FATA) and northern Balochistan" and "Dawa schools run by Jamat-ud-Dawa" as being involved with teaching extremism or supporting terrorist organizations. Currently, the popularity of madrasas is rising in parts of Southeast Asia. For example in Indonesia, home to the largest number of Muslims in the world, almost 20%-25% of primary and secondary school children attend pesantren s (Islamic religious schools). Indonesian pesantrens have been noted for teaching a moderate form of Islam, one that encompasses Islamic mysticism or Sufism. Authorities in Bangladesh have expressed concern about the use of madrasas by a network of Islamist activists being investigated in connection with a number of attempted and successful bombing attacks across the country. A number of madrasa students were detained in connection with the investigations. Executive agencies and Congress have shown increasing interest in improving U.S. outreach and addressing educational challenges in the Muslim world in the aftermath of the September 11 terrorist attacks. The Final Report of the National Commission on Terrorist Attacks upon the United States (the "9/11 Commission") addressed education issues in the Islamic world in the context of its recommendations to identify and prioritize actual or possible terrorist sanctuaries and prevent the continued growth of Islamist terrorism. Relevant sections of the Intelligence Reform and Terrorism Prevention Act ( P.L. 108 - 458 , December 17, 2004) address many of the concerns reflected in the 9/11 Commission's final report regarding the improvement of educational opportunity in the Islamic world. Section 7114 of the act authorizes the President to establish an International Youth Opportunity Fund to improve public education in the Middle East. Examples of action taken to effect educational changes in Islamic countries include USAID's September 2002 commitment of $100 million over five years for general education reform in Pakistan. The Administration requested $259.664 million in FY2008 foreign operations funding to support ongoing education assistance programs in a number of Middle Eastern countries, including Egypt, Yemen, Jordan, Iraq, Lebanon, and Morocco. The Administration requested $118.670 million for similar programs in South and Central Asia, including programs in Afghanistan, Pakistan, and Bangladesh. In the 110 th Congress, Title XX of P.L. 110 - 53 , the Implementing the 9/11 Commission Recommendations Act of 2007 (signed August 3, 2007), amends and re-authorizes appropriations for an International Muslim Youth Opportunity Fund originally authorized by Section 7114 of P.L. 108 - 458 . The law also requires the Administration to submit an annual report to Congress on the efforts of Arab and predominantly Muslim countries to increase the availability of modern basic education and to close educational institutions that promote religious extremism and terrorism. A separate report is required on U.S. education assistance and the status of efforts to create the authorized Fund.

Since the terrorist attacks on September 11, 2001, the Islamic religious schools known as madrasas (or madrassahs) in the Middle East, Central, and Southeast Asia have been of increasing interest to U.S. policy makers. Some allege ties between madrasas and terrorist organizations, such as Al Qaeda, and assert that these religious schools promote Islamic extremism and militancy. Others maintain that most madrasas have been blamed unfairly for fostering anti-Americanism and for producing terrorists. This report provides an overview of madrasas, their role in the Muslim world, and issues related to their alleged links to terrorism. The report also addresses the findings of the National Commission on Terrorist Attacks Upon the United States (the "9/11 Commission") and issues relevant to the second session of the 110th Congress. Related products include CRS Report RS22009, Education Reform in Pakistan, by [author name scrubbed], CRS Report RL33533, Saudi Arabia: Background and U.S. Relations, by [author name scrubbed], CRS Report RL32499, Saudi Arabia: Terrorist Financing Issues, by [author name scrubbed], CRS Report RS21695, The Islamic Traditions of Wahhabism and Salafiyya, by [author name scrubbed], CRS Report RS21457, The Middle East Partnership Initiative: An Overview, by [author name scrubbed], and CRS Report RL32259, Terrorism in South Asia, by [author name scrubbed] and [author name scrubbed]. This report will be updated periodically.

Head Start, a federal program that has provided comprehensive early childhood development services to low-income children since 1965, was last reauthorized in 1998 for fiscal years 1999-2003. The program has remained alive in subsequent years through the annual appropriations process. After unsuccessful efforts by the 108 th and 109 th Congresses to complete the reauthorization process, the 110 th Congress has undertaken the task. The House and Senate have each passed its own version of a reauthorization bill, the Senate version adopting the House bill's number ( H.R. 1429 ) and representing only a slightly modified version of the bill reported by the Senate Health, Education, Labor, and Pensions Committee ( S. 556 ). On November 9, 2007, House and Senate conferees filed a conference report ( H.Rept. 110-439 ). This report does not yet reflect the provisions contained in that agreement. The Improving Head Start Act of 2007 ( H.R. 1429 ) was introduced by Representative Kildee on March 9, 2007. The following week, the House Committee on Education and Labor debated, amended, and approved the bill (42-1), and the committee's written report accompanying the legislation ( H.Rept. 110-67 ) was filed on March 23, 2007. That bill was taken to the House floor on May 2, and was approved (with nine amendments) by a vote of 365-48. Twelve amendments in total were offered on the floor, in addition to a motion to recommit (which was rejected). The Head Start for School Readiness Act ( S. 556 ) was introduced by Senator Kennedy on February 12, 2007, and approved via voice vote by the Senate Committee on Health, Education, Labor, and Pensions (HELP) on February 14. The Chairman's amended version of the bill was subsequently reported on March 29, 2007; a written report ( S.Rept. 110-49 ) was filed April 10, 2007. On June 19, the Senate passed (by voice vote under a unanimous consent agreement) its bill, adopting the bill number of the reauthorization bill that passed the House ( H.R. 1429 ), but substituting its own committee-reported bill language of S. 556 (with a few technical changes). Both reauthorization bills propose to amend Head Start with the purpose of improving the program's ability to promote low-income children's school readiness by supporting their cognitive, social, emotional, and physical development. The means for doing so encompass a wide range of provisions, covering issues of program funding, administration, eligibility, accountability, quality, governance, and coordination. Below is an overview of broad areas addressed in the proposed legislation, followed by Table 1 , a detailed side-by-side comparison of each bill's provisions with current law (and, where relevant, current regulations). The areas listed below are not intended to encompass every provision included in each of the respective bills, but rather major areas addressed. The table does not reflect the provisions agreed to in conference. Despite the expiration of authorizing language, the Head Start program has continued to receive its funding through the annual appropriations process, most recently (FY2007) at a level of almost $6.9 billion. From FY1995-FY2003, the Head Start Act authorized funding Head Start at an unspecified dollar amount—"such sums as may be necessary." The reauthorization bills propose to increase funding for Head Start, with both bills designating a dollar amount ($7.350 billion) for FY2008. After FY2008, the House version of H.R. 1429 would authorize "such sums as may be necessary" for each of the remaining four years covered by the legislation, whereas the Senate version includes specific increases for FY2009 and FY2010, before once again mirroring the House bill with unspecified amounts for FY2011 and FY2012. Both bills propose changes with respect to the allocation of appropriated funds. Within the 13% currently reserved from the total appropriation for a variety of purposes, both bills introduce a greater level of specificity, assigning designated percentages (of the total appropriation) for allotments to Indian and Migrant Head Start programs. In the case of both bills, the percentages proposed reflect increases above the portion currently received (and not set in statute). The allocation formula for determining state allotments is changed in both bills to update the "hold harmless," or base amounts assured for the states. Appropriated funds available to states after allotting the hold harmless amounts would be distributed differently by the two bills. The House bill would continue to allot remaining funds based on states' relative shares of poor children under age 5, while the Senate bill introduces a new provision in which a portion of the remaining funds would be allocated based on the percentage of eligible children served by grantees within the state. Program quality is also addressed by the funding allocation provisions. The proposed legislation would maintain current law's practice of reserving a designated percentage of the aforementioned remainder funds for "quality improvement," with both bills proposing greater percentages for this purpose than under current law. Both bills elaborate on the uses of quality improvement funds. Both bills would increase the percentage of the total appropriation reserved for funding Early Head Start programs, with a caveat that these percentages may only be reached provided appropriation levels suffice. To compare the specifics of these and other funding-related provisions, see the portions of Table 1 that refer to Sections 639 and 640 of current law. Provisions designed to address issues of accountability take several forms. Both bills target accountability with respect to fiscal and program management, as well as accountability with respect to Head Start children's outcomes. Under both the House bill and Senate bill, agencies would be designated as a grantee for no more than five years at a time, after which recompetition may be required. (Under current law, grantees do not have to recompete for funds.) Only the House version would establish an application review system to be used during this process; however, both bills establish means for determining what constitutes a "high-performing" grantee, and those agencies not meeting the standard would be faced with recompetition. In order to be considered a high performing grantee under either bill, Head Start agencies would need to demonstrate competent financial management, as well as the ability to deliver a program high in quality, developmentally appropriate, and based on scientifically-based research and measures. Both bills add new language to current law, requiring programs' governing bodies to include individuals with expertise in fiscal matters. Both bills would introduce detailed definitions of "deficiency" into statute, along with provisions to help ensure that funding for any grantees or delegates unable or unwilling to correct deficiencies be suspended or terminated as necessary. As reflected in Table 1 , particularly within Sec. 641A, the two proposals often expand on current regulations with respect to corrective actions. Both bills emphasize the use of scientifically-based early childhood research as a basis for formulating educational measures for children and developing appropriate curricula that will lead to positive outcomes. Likewise, both would suspend use of the National Reporting System (NRS) in its current form, pending further review and recommendations from a National Academy of Sciences panel. The importance of effective and reliable screening and assessments in the Head Start program is stressed by both bills, accompanied by an emphasis on the value of ensuring that the tools used for screening and assessment be scientifically sound, based on the most up-to-date research in the field. Current law emphasizes shared governance and parent involvement within Head Start programs in general terms, leaving the details to regulation. Both versions of H.R. 1429 would introduce into statute more detailed provisions regarding program governance, clearly outlining the composition and responsibilities of both the governing bodies and the policy councils. The reports accompanying the legislation emphasize the committees' intent that a commitment be made to maintaining the structure of shared governance (between governing bodies and policy councils), with clear language that the governing bodies hold legal and fiscal accountability. The responsibilities of policy councils are stated in both bills, but using different language; both bills are more specific than current regulations. As in current regulations, both bills make reference to the need for an impasse policy or means for dealing with internal disputes, in the event that a governing body disagrees with recommendations from the policy council. As noted in Table 1 , within the two bills, the provisions related to program governance do not amend the same section of current law. Section 8 of the House version of H.R. 1429 includes the provisions stating the required composition, role and responsibilities of the governing bodies and councils as part of amendments to Sec. 642, whereas the Senate bill includes its program governance requirements (including composition, roles, and responsibilities) in Section 7, the portion of the bill that amends Sec. 641 of current law. Provisions that aim to improve the quality of Head Start programs (through a variety of means) permeate both reauthorization bills. Some of these provisions, already alluded to, relate to allocation of funds for quality and technical assistance and training, designating agencies, and developing standards and measures. In addition, both proposed bills would amend Sec. 648A of current law to increase staff qualifications for Head Start teachers (but with different requirements). Accompanying report language makes clear both committees' view that teacher quality is essential to early childhood program quality. Professional development is promoted in both bills, as are efforts to enhance services for children with limited English proficiency. Included in the Senate bill is a newly proposed section (641B) to the Head Start Act, which would provide for the establishment of a program under which the Secretary of Health and Human Services (HHS) would designate up to 200 exemplary Head Start agencies as "Centers of Excellence in Early Childhood." These agencies would receive (pending appropriation of funds) bonus grants of at least $200,000 per year. Like regularly designated grantees, the Centers of Excellence bonus grants would be designated for up to five years at a time. In addition to provisions aimed at improving the quality and accountability of Head Start programs, both bills would amend current law to foster even greater program coordination between Head Start and other early childhood programs, including state prekindergartens. Program coordination includes providing for alignment of Head Start goals and expectations with those schools into which Head Start children will later enroll. Coordination is also to be enhanced by bolstering state and local relationships with Head Start. The House version of H.R. 1429 proposes a new section, 642B, specifically outlining the partnerships that Head Start agencies are to enter into with local education agencies, including a description of the memorandum of understanding that each Head Start agency would negotiate with the local entities. Under both bills, collaboration grants are described in greater detail, and the state's role in collaboration is bolstered through involvement of an Early Learning Council (under the House bill) or a State Advisory Council (under the Senate bill). Under current law, all children from families with income under 100% of the poverty line are eligible for Head Start. Regulations state that at least 90% of children enrolled in each program must fit this criterion, allowing for 10% to be over-income. Both bills would allow for expansion of eligibility up to 130% of the poverty line, with the House version of H.R. 1429 specifying that no more than 20% of children served by a Head Start program be above the poverty line. In the case of both bills, the intent is that programs seek to serve children under 100% of poverty before serving those from families with higher incomes. Homeless children would also be deemed categorically eligible under both bills. Both bills address the issue of how to confront situations of under-enrollment in Head Start programs, recognizing that the cause of these situations may differ from program to program, sometimes reflecting a program weakness while in other cases demographic changes in the community. Another provision reflecting both committees' desire for greater flexibility with respect to participation and serving the needs of communities is one that allows for regular funds to be used for serving Early Head Start infants and toddlers. Doing so requires approval of a written application under both bills, but the possibility for this expansion of services would be written into law. Table 1 provides a detailed comparison of the House- and Senate-passed versions of H.R. 1429 , and current law. Where applicable, current regulations are included to show whether changes proposed in the reauthorization bills would reflect practical changes to the program. As stated earlier, the table does not include provisions agreed to in the conference report ( H.Rept. 110-439 ) filed on November 9, 2007. The table is structured in the order of current law's sections. In cases where bills address the same or similar provisions by amending different sections of current law, that has been noted in the table. The table also notes if a provision was added as an amendment during House floor debate.

Head Start, a federal program that has provided comprehensive early childhood development services to low-income children since 1965, was last reauthorized in 1998 for fiscal years 1999-2003. The program has remained funded in subsequent years through the annual appropriations process. After unsuccessful efforts by the past two Congresses to complete the reauthorization process, efforts to do so are underway in the 110th Congress. The House and Senate have each passed their own version of a reauthorization bill (H.R. 1429), and on November 9, 2007, conferees filed a conference report (H.Rept. 110-439). This report does not yet reflect the provisions included in the conference agreement. The Improving Head Start Act of 2007 (H.R. 1429) was introduced by Representative Kildee on March 9, 2007. The following week, the House Committee on Education and Labor debated, amended, and approved the bill (42-1), and the committee's written report accompanying the legislation (H.Rept. 110-67) was filed on March 23, 2007. That bill was taken to the House floor on May 2, and was approved (with nine amendments) by a vote of 365-48. The Head Start for School Readiness Act (S. 556) was introduced by Senator Kennedy on February 12, 2007, and approved via voice vote by the Senate Committee on Health, Education, Labor, and Pensions (HELP) on February 14. The Chairman's amended version of the bill was subsequently reported on March 29, 2007, with a written report (S.Rept. 110-49) filed April 10, 2007. On June 19, under unanimous consent, the full Senate passed the committee's bill, with a few technical changes, under the House bill number (H.R. 1429). Both reauthorization bills amend Head Start with the goal of improving the program's ability to promote low-income children's school readiness by supporting their cognitive, social, emotional, and physical development. The means for doing so encompass a wide range of provisions, covering issues of program funding, administration, eligibility, accountability, quality, governance, and coordination. Authorization levels for funding would be increased above current funding amounts by both bills, and eligibility would be expanded to allow for serving children up to 130% of the poverty line. Both bills include provisions that would increase competition for Head Start grants, by limiting the period for which a grantee may receive grant funds to five years, before recompetition may be required. Other similarities include increasing the percentage of the appropriation to be reserved for Early Head Start; emphasizing coordination and collaboration with other state and local early childhood programs; increasing staff qualifications; specifying requirements of shared governance principles in statute; and suspending use of the National Reporting System. Although the overall areas addressed by the two reauthorization bills are similar, a side-by-side comparison of provisions, alongside current law, reveals notable differences in detail. The table does not reflect the provisions agreed to in conference.

The United States Congress is served by a group of young adults known as pages. Pages have been employed since the early Congresses, and some Members of Congress have served as pages. Today, congressional pages include students who are juniors in high school and who may come from all areas of the United States and its territories. The page system is formally provided for in law, although the rationale for the page service or for using high school students is not. Since the earliest accounts of pages, it has been widely noted in debates and writings within Congress that pages provide needed messenger services: From the origin of the present government, in 1789, to the present time, they [messengers] have been under the orders and resolutions of the House, and experience has attested to the necessity of their services. The use of boys or pages, was introduced at a later period; but from the first session of Congress held at the city of Washington [1800], they have continued to be employed by the House, with the approbation of the House. Being a page provides a unique educational opportunity, affording young adults an opportunity to learn about Congress, the legislative process, and to develop workplace and leadership skills. Over the years, there has been concern about having young pages serve Congress. In the 1800s and early 1900s, some House pages were as young as 10 and Senate pages as young as 13. Later, they were as old as 18. At various times, congressional actions related to employing pages have addressed the lack of supervised housing as well as pages' ages, tenure, selection, education, and management. Far-reaching reforms in the page system were implemented in 1982 and 1983, following press reports of insufficient supervision, alleged sexual misconduct, and involvement in the trafficking of drugs on Capitol Hill. Most reports of misbehavior were later found to be unsubstantiated. As a consequence of the allegations, however, both the House and Senate for the first time provided supervised housing for their pages; established separate page schools and took over the education of the pages, which had been provided under contract by the District of Columbia school system; and developed more educational and recreational opportunities for their pages. In the 110 th Congress (2007-2008), at the request of then House Speaker Nancy Pelosi and Republican Leader John Boehner, the House inspector general (IG) conducted an inquiry into the supervision and operation of the House Page Residence Hall, and subsequently issued a confidential report recommending changes. In 2008, an independent study, conducted by consultants to the House, was conducted. In response to the findings of those efforts, the House implemented new policies to enhance the safety and supervision of the pages and oversight of the page program. These changes followed investigations of allegations related to the page program participants, including the exchange of inappropriate communications between a Member of the House and former pages, and of misbehavior by a few pages in the 109 th and 110 th Congresses. A follow up review of the page program was carried out in the summer of 2010 by the same independent consultants. According to House leaders, concerns raised in 2008, including costs and the need for the program, remained. In August 2011, Speaker John Boehner and Democratic Leader Nancy Pelosi announced the termination of the House page program effective August 31. In a Dear Colleague Letter, the leaders cited both changes in technology obviating the need for most page services, and the program's costs as reasons to discontinue the program. In the 112 th Congress, (2011-2012), H.Res. 397 , entitled Reestablishing the House of Representatives Page Program, was introduced by Representative Dan Boren. The resolution would have created an advisory panel to make recommendations for the operation of a reestablished page program. The House page program would have been reestablished in the first school semester after the advisory panel submitted its recommendations to the Committee on House Administration. Membership of the nine-person advisory body would have been composed of three Members of the House from the majority party of the House, three Members of the House from the minority party, and three individuals who were not Members and who had served as House pages. The measure was referred to the Committee on House Administration, and no further action was taken. Pages serve principally as messengers. They carry documents between the House and Senate, Members' offices, committees, and the Library of Congress. They prepare the Senate chamber for each day's business by distributing the Congressional Record and other documents related to the day's agenda, assist in the cloakrooms and chambers; and when Congress is in session, they sit near the dais where they may be summoned by Members for assistance. In the House, pages also previously raised and lowered the flag on the roof of the Capitol. There are 30 Senate page positions, 16 for the majority party and 14 for the minority party. The office of the Sergeant at Arms supervises the Senate page program. The Senate page program consists of four quarters, two academic year sessions and two shorter summer sessions. It is administered by the Senate Sergeant at Arms, the Senate page program director, and the principal of the Senate page school. Senate pages are paid a stipend, and deductions are taken for taxes and residence hall fee, which includes a meal plan. Pages must pay their transportation costs to Washington, DC, but their uniforms are supplied. The uniforms consist of navy blue suits, white shirts, red and blue striped tie, dark socks, and black shoes. The Senate provides its pages education and supervised housing in the Daniel Webster Page Residence near the Hart Senate Office Building. The Senate Page School is located in the lower level of Webster Hall. Pages who serve during the academic year are educated in this school, which is also accredited by the Middle States Association of Colleges and Schools. The junior-year curriculum is geared toward college preparation and emphasis is given to the unique learning opportunities available in Washington, DC. Early morning classes are held prior to the convening of the Senate. The House page program was administered by the Office of the Clerk, under the supervision of the House Page Board. The board, established in statute, is composed of two Members from each party, including the chair, as well as the Clerk and the Sergeant at Arms of the House, a former House page, and the parent of a House page. Participants in the House page program typically served for one academic semester during the school year, or during a summer session. House pages received a stipend for their services, and deductions were taken from their salaries for federal and state taxes, Social Security, and a residence hall fee, which included a meal plan. The pages were required to live in the supervised House Page Dormitory near the Capitol. They were responsible for the cost of their uniforms—navy jackets, dark grey slacks or skirts, long sleeve white shirt, red and blue striped tie, and black shoes—and transportation to and from Washington, DC. During the school year, pages were educated in the House Page School located in the Thomas Jefferson Building of the Library of Congress. The page school, which is accredited by the Middle States Association of Colleges and Schools, offered a junior-year high-school curriculum, college preparatory courses, and extracurricular and weekend activities. Classes were usually held five days a week, commencing at 6:45 a.m., prior to the convening of the House.

For more than 180 years, messengers known as pages have served the United States Congress. Pages must be high school juniors and at least 16 years of age. Several incumbent and former Members of Congress as well as other prominent Americans have served as congressional pages. Senator Daniel Webster appointed the first Senate page in 1829. The first House pages began their service in 1842. Women were first appointed as pages in 1971. In August 2011, House leaders announced the termination of that chamber's page program. Senate pages are appointed and sponsored by Senators for one academic semester of the school year, or for a summer session. The right to appoint pages rotates among Senators pursuant to criteria set by the Senate's leadership. Academic standing is one of the most important criteria used in the final selection of pages. Selection criteria for House pages was similar when the page program operated in that chamber. Prospective Senate pages are advised to contact their Senators to request consideration for a page appointment.

RS21772 -- AGOA III: Amendment to the African Growth and Opportunity Act Updated January 19, 2005 After two decades of economic stagnation and decline, some African countries began to show signs of renewed economic growth in the early 1990s. Thisgrowth was generally due to better global economic conditions and improved economic management. However,growth in Africa was also threatened by newfactors, such as HIV/AIDS and high foreign debt levels. The African Growth and Opportunity Act (AGOA) ( P.L.106-200 - Title I) was enacted to encouragetrade as a way to further economic growth in Sub-Saharan Africa and to help integrate the region into the worldeconomy. AGOA provided trade preferencesand other benefits to countries that were making progress in economic, legal, and human rights reforms. Currently,37 of the 48 Sub-Saharan African countriesare eligible for benefits under AGOA. AGOA expands duty-free and quota-free access to the United States as provided under the U.S. Generalized System of Preferences (GSP). (1) GSP grantspreferential access into the United States for approximately 4,600 products. AGOA extends preferential access toabout 2,000 additional products by removingcertain product eligibility restrictions of GSP and extends the expiration date of the preferences for beneficiaryAfrican countries from 2006 to 2015. Otherthan articles expressly stipulated, only articles that are determined by the United States as not import-sensitive (inthe context of imports from AGOAbeneficiaries) are eligible for duty-free access under AGOA. Beyond trade preferences, AGOA directs the President to provide technical assistance and trade capacity support to AGOA beneficiary countries. Various U.S.government agencies carry out trade-related technical assistance in Sub-Saharan Africa. The U.S. Agency forInternational Development funds three regionaltrade hubs, located in Ghana, Kenya, and Botswana, that provide trade technical assistance. Such assistance includes support for improving Africangovernments' trade policy and business development strategies; capacity to participate in trade agreementnegotiations; compliance with WTO policies and withU.S. phytosanitary regulations; and strategies for further benefiting from AGOA. AGOA also provides for duty- and quota-free entry into the United States of certain apparel articles, a benefit not extended to other GSP countries. This hasstimulated job growth and investment in certain countries, such as Lesotho and Kenya, and has the potential tosimilarly boost the economies of other countries,such as Namibia and Ghana. In order to qualify for this provision of AGOA, however, beneficiary countries mustdevelop a U.S.-approved visa system toprevent illegal transshipments. Of the 37 AGOA-eligible countries, 24 are qualified for duty-freeapparel trade (wearing-apparel qualified). These countriesmay also benefit from Lesser Developed Country (LDC) status. Countries that have LDC status for the purpose ofAGOA, and are wearing-apparel qualified,may obtain fabric and yarn for apparel production from outside the AGOA region. As long as the apparel isassembled within the LDC country, they mayexport it duty-free to the United States. Some LDC AGOA beneficiaries have used this provision to jump-start theirapparel industries. This provision was dueto expire on September 30, 2004. The AGOA Acceleration Act extends the LDC provision to September 30, 2007,with a reduction in the cap on the allowablepercentage of total U.S. apparel imports beginning in October 2006. Countries that are not designated as LDCs butare wearing apparel qualified must use onlyfabric and yarn from AGOA-eligible countries or from the United States. The only wearing apparel qualifiednon-LDC countries is South Africa, althoughMauritius only qualifies for LDC status under AGOA for one year ending September 30, 2005, per theMiscellaneous Trade and Technical Corrections Act of2003 ( P.L. 108-429 ). AGOA was first amended in the Trade Act of 2002 ( P.L. 107-210 ), which doubled a pre-existing cap set on allowable duty-free apparel imports. The cap wasonly doubled for apparel imports that meet non-LDC rules of origin; apparel imports produced with foreign fabricwere still subject to the original cap. Theamendment also clarified certain apparel rules of origin, granted LDC status to Namibia and Botswana for thepurposes of AGOA, and provided that U.S.workers displaced by production shifts due to AGOA could be eligible for trade adjustment assistance. U.S. duty-free imports under AGOA (excluding GSP) increased dramatically in 2003 -- by about 58%, from $8.36 billion in 2002 to $13.19 billion in 2003-- after a more modest increase of about 10% in 2002. (2) However, 70% of these imports consisted of energy-related products from Nigeria. ExcludingNigeria, U.S. imports under AGOA increased 30% in 2003, to $3.84 billion, up from $2.95 billion in 2002. Theincrease in AGOA imports since the law'senactment is impressive, but it must be viewed in the broader context of Africa's declining share of U.S. trade overmany years. AGOA has done little to slowor reverse this trend -- the growth in AGOA trade can be explained by a greater number of already-traded goodsreceiving duty free treatment under AGOA. One industry has grown substantially under AGOA: the textile and apparel industry. Much of the growth in textileand apparel imports has come from thenewly emerging apparel industries in Lesotho, Kenya, and Swaziland. Apart from the apparent success of the emergent apparel industries in some African countries, the potential benefits from AGOA have been slowly realized. There has been little export diversification, with the exception of a few countries whose governments have activelypromoted diversification. Agriculturalproducts are a promising area for African export growth, but African producers have faced difficulties in meetingU.S. regulatory and market standards. Manycountries have been slow to utilize AGOA at all. Others, such as Mali, Rwanda, and Senegal, have implementedAGOA-related projects, but have madeinsignificant gains thus far. In addition to lack of market access, there are substantial obstacles to increased exportgrowth in Africa. Key impediments includeinsufficient domestic markets, lack of investment capital, and poor transportation and power infrastructures. Othersignificant challenges include low levels ofhealth and education, protectionist trade policies in Africa, and the high cost of doing business in Africa due tocorruption and inefficient governmentregulation. Furthermore, the apparel industry in Africa now faces a challenge in the dismantled MultifibreArrangement quota regime, which ended as ofJanuary 1, 2005. As a result, Africa must now compete more directly with Asian apparel producers for the U.S.market. AGOA beneficiaries retain theirduty-free advantage, but they have lost their more significant quota-free advantage. Apparel producers havereportedly already left Lesotho, with a loss of 7,000jobs. (3) This makes export diversification in Africaall the more vital. AGOA III extends the preference program to 2015 from its previous 2008 deadline. AGOA III supporters claimed that many AGOA beneficiaries had onlyrecently begun to realize gains as a result of AGOA, and that extending AGOA benefits would improve the stabilityof the investment climate in Africa. AGOA III also provides for apparel rules of origin and product eligibility benefits; it extends the third-country fabricrule for LDCs, and encourages foreigninvestment and the development of agriculture and physical infrastructures. Extension of Lesser Developed Country Provision. One of the more controversial aspects of AGOA III wasthe extension of the LDC provision. If the LDC provision had not been extended, LDCs would no longer haveduty-free access to the United States for apparelmade from third-country fabric after September 30, 2004. Supporters of the extension claimed that if the LDCprovision was not extended, the apparel industrymay have contracted significantly, causing a loss of many of the gains from AGOA, as apparel assembly plants wereshut down. This might have occurredbecause all AGOA beneficiaries would need to source their fabric and yarn from within the AGOA region or fromthe United States in order to get duty-freeaccess under AGOA, and the regional supply of fabric and yarn would likely be insufficient to meet the demand. (4) Sourcing materials from the United Stateswould not be a viable option because it would entail greater costs. Some analysts argued for the LDC provision tobe extended to allow more time to develop atextile milling industry to support the needs of the apparel industry in Africa, and to prevent the collapse of theemerging apparel industry. Opponents of extending the LDC provision claimed that the expiration of the LDC provision would provide an incentive for further textile milling investmentsin Africa. They argued that the LDC provision has slowed fabric and yarn production investment in Africa, becausethese materials could be imported cheaplyfrom Asia for use in AGOA-eligible apparel with no need for costly investments. They feared that an extension ofthe LDC provision would provide adisincentive to textile milling investment in Africa, because the deadline would lose its credibility as investorsanticipated further extensions. However,supporters of the extension argued that investment in the textile industry would continue because of its inherentprofitability, despite the availability ofthird-country fabric. Others worried that looser rules of origin under the LDC provision might allow companies touse Africa as a transshipment point betweenAsia and the United States. The outlook for the development of a textile industry in Sub-Saharan Africa is clouded by the phase-out of the Multifibre Arrangement (MFA) quota regime inJanuary 2005. (5) Now that quotas have beeneliminated, Africa will be competing more directly with Asia for the U.S. apparel and textile market, though theyremain eligible for tariff preferences. Apparel plants are particularly sensitive to price conditions as they do notrequire large capital investments and can easilyand rapidly be shifted to areas outside Africa. Textile plants are more capital-intensive and more costly to move,and are therefore likely to remain in Africa inthe long-term. Thus, it is argued that the promotion of vertical integration between apparel, textile, and cottonproducers is necessary to keep apparel plants inAfrica, along with the jobs they provide. Vertical integration is a challenging prospect regardless of the LDCprovision extension. Some investment in textilemilling has occurred in Africa, but investors have found it difficult to consistently source high quality cotton in largevolumes. While there is agreement thatvertical integration is the key to a thriving African textile and apparel industry, the question is how to facilitate thisprocess. (6) Agricultural Products. The growth of agricultural trade holds potential for improved economic growth inAfrica. Most Africans rely on agricultural production for their income. It is estimated that 62% of the labor forcein Africa works in agriculture, and in thepoorer countries, that portion is as high as 92%. (7) By exporting to the U.S. market, African agricultural producers could receive higher prices for their goods. In order for this to occur, the United States may need to further open its market to African agricultural products, andprovide technical assistance to help Africanagricultural producers meet the high standards of the U.S. market. AGOA III seeks to improve African agricultural market access to the United States by providing assistance to African countries to enable them to meet U.S.technical agricultural standards. African agricultural producers have previously faced difficulties in meeting thesestandards. The AGOA Acceleration Actcalls for the placement of 20 full-time personnel to at least 10 countries in Africa to provide this assistance. Someobservers are skeptical about theeffectiveness of technical assistance without increased market access. Others are concerned that U.S. technicalassistance is hindered by laws restrictingagricultural technical assistance to products that would compete with U.S. farm products. However, technicalassistance proponents point to the lowinstitutional capacity in Africa as the main obstacle to African export-led development. They feel that U.S.-providedtechnical assistance can be an importantfactor in improving Africa's agricultural development and export performance. Table 1. Provisions from the AGOA Acceleration Act of 2004

On July 13, 2004, the "AGOA Acceleration Act of 2004" was signed by the Presidentand became P.L.108-274. This legislation amends the African Growth and Opportunity Act (AGOA; P.L. 106-200, Title I), extending it to2015. AGOA seeks to spur economicdevelopment and help integrate Africa into the world trading system by granting trade preferences and other benefitsto Sub-Saharan African countries that meetcertain criteria relating to market reform and human rights. Congress first amended AGOA in 2002 (P.L. 107-210)by increasing a cap on duty-free apparelimports and clarifying other provisions. The new AGOA amendment, commonly referred to as "AGOA III," extendsthe legislation beyond its currentexpiration date of 2008 and otherwise amends existing AGOA provisions. For further information on AGOA, seeCRS Report RL31772, U.S. Trade andInvestment Relationship with Sub- Saharan Africa: The African Growth and Opportunity Act and Beyond. This report will be updated as needed.

RS21689 -- Federal Pay - Status of January 2004 Adjustments: A Fact Sheet Updated January 24, 2004 Under 5 U.S.C. 5303, General Schedule basic salaries, and those of other related statutory systems, are to be adjusted the first pay periodbeginning on or after January 1 of each year (January 11, 2004). The adjustments are determined by the change inthe private sector element of the EmploymentCost Index (ECI) from September to September. The percentage of change, minus 0.5%, becomes the scheduledrate of adjustment. For January 2004, the rateof adjustment was scheduled at 2.7%. Locality-based payments are determined separately, based on wage surveydata from 32 geographicareas. Under 5 U.S.C. 5303 and 5 U.S.C. 5304, President George W. Bush sent forward an alternative plan in August 2003 that called for a 1.5%increase in General Schedule, and related systems, basic pay and an average of 0.5% in locality-based payments forJanuary 2004. Barring any action by Congress to establish a different rate or effective date, the President's alternative plan willgovern. Both the House and Senate voted to establish a 4.1% pay adjustment, effective January 2004. (2) With passage of the 4.1%, the basic pay adjustment will be the scheduled ECI adjustment of 2.7% and the locality pay adjustment willaverage 1.4%. For the Washington, DC, area, the net adjustment will be 4.41%. Under Section 704, P.L. 101-194 , the Ethics Reform Act of 1989, salaries of Members and officers of Congress, federal judges, andexecutive branch officials on the Executive Schedule (collectively referred to herein as "officials") are to be adjustedannually based on December-to-Decemberpercentage changes in the private sector element of the ECI, effective in the same month as the GSadjustments. The scheduled January 2004 pay adjustment, based on the ECI, is 2.2%. Section 704, as amended, stipulates that officials' pay adjustments cannot exceed the rate of adjustment for GS basicpay. P.L. 108-167 , as required under Section 140, P.L. 97-92 , permits the judges to receive the annual adjustment. GS pay adjustment in January 2004, pending presidential approval of the FY2004 Consolidated Appropriations Act, is limited to 1.5% forbasic pay and an average of 0.5% for locality. The net adjustment for the Washington, DC, area has been 2.12%(Executive Order 13322, 69 Federal Register 231). The pay adjustment for officials has been limited to 1.5%. Upon approval of the Consolidated Appropriations Act, 2004, GS pay will be adjusted to a total of 4.1%, retroactive to the first pay periodbeginning on or after January 1, 2004, with the rate of 2.7% for basic pay. Salaries of officials will increase to the2.2% rate,retroactively.

Federal pay adjustment rates going into effect in January 2004, under Executive Order13322 (69 Federal Register231) were less than those in the pending Consolidated Appropriations Act, 2004 (H.R. 2673). The GeneralSchedule (GS) and related salarysystems were limited to 2.0%, as opposed to the 4.1% subsequently passed. Salaries of officials in the threebranches were temporarily limited, due to the lowerGS rate, to 1.5%, rather than the scheduled 2.2%, which upon Presidential approval of H.R. 2673, will go into effectretroactively.

Democratic Conference: The conference is the caucus of all Democratic Senators and serves as the central coordinating body. It operates through the Democratic leader's office and is responsible for communicating the party's message. The Democratic leader serves as chair of the conference, which is also led by a vice-chair and a secretary. Democratic Policy Committee: The policy committee is responsible for the formulation of overall legislative policy. It provides background and analysis of pending legislation, and organizes briefings and strategy meetings for Democratic Members and staff. The policy committee is led by a chair, appointed by the Democratic leader and includes regional chairs and members. Democratic Steering and Outreach Committee: Often referred to as the steering committee, this group maintains liaison between the Democratic leadership and Democratic elected officials around the country. It also is responsible for making committee assignment recommendations. It is led by a chair, appointed by the Democratic leader, who is assisted by an executive committee. Democratic Committee on Committee Outreach: This group provides a voice in the Democratic leadership for committee chairs. An appointed chair and vice-chair coordinate the committee work. Democratic Committee on Rural Outreach: This group guides rural outreach and tries to find new ways to reach rural, suburban, and ex-urban communities. It is led by an appointed chair. Democratic Senatorial Campaign Committee: This panel is the fund-raising arm of the Senate Democrats that provides financial and research assistance to Democratic Senators seeking reelection and to non-incumbent Democratic Senate nominees. It is led by a chair appointed by the Democratic leader, vice-chair, treasurer, and a board of trustees. Republican Conference: The Republican Conference is the organizational vehicle for Republican Members and their staff. It hosts periodic meetings of Senate Republicans and is the primary vehicle for communicating the party's message. The conference is led by an elected chair and vice-chair. Republican Policy Committee: The policy committee assists Senate leaders and committee chairs in designing, developing, and executing policy ideas. The policy committee hosts a weekly lunch meeting of Republican Senators and provides summaries of major bills and amendments, prepares analyses of rollcall votes, and distributes issue papers. It is led by an elected chair, and comprises members of the party leadership, the chairs of selected committees, and members designated by the Republican leader to serve on an executive committee. Republican Steering Committee: The steering committee is responsible for making committee assignment recommendations. It is led by a chair appointed by the Republican leader and an executive committee. Republican Senatorial Committee: The campaign committee oversees the political and fund-raising efforts of Senate Republicans. It is led by a chair appointed by the Republican leader and an executive committee.

Each Congress, Senators meet to organize the chamber and select their party leaders. In addition to the majority and minority leaders and party whips are numerous entities created by the party to assist with the work of the party.

In the 1970s, a series of lawsuits began challenging the funding disparities among school districts within the states. Schools in the U.S., which typically receive some federal and state financial assistance, generally derive a substantial percentage of their funding from local property taxes, which, at least in the early days of education finance litigation, generated significantly different levels of funding depending on how much the property in a given district was worth. Spurred by concerns that such disparities discriminated against students in poor school districts or resulted in an inadequate education, school finance plaintiffs began filing lawsuits in federal and state courts based on theories involving educational equity or adequacy. In the most prominent federal case on school financing, San Antonio Independent School District v. Rodriguez , the Supreme Court rejected a legal challenge to Texas's system of public financing for its elementary and secondary schools, holding that the state finance system did not violate equal protection or interfere with a fundamental right. Ultimately, the Rodriguez case, which clarified that school funding disparities were not a federal issue, foreclosed school finance claims based on the U.S. Constitution and prompted plaintiffs to file lawsuits based on state constitutional claims, thereby transforming education finance litigation into an issue of state law. This report discusses the Rodriguez case and the resulting flurry of state education finance litigation, including the dominant legal theories of equity and adequacy and the leading cases in each of these areas. In Rodriguez , the original plaintiffs in the case challenged the Texas state system of public financing for elementary and secondary schools, which they claimed to be a violation of the Equal Protection Clause of the Fourteenth Amendment because funding under the system, which was based on local property taxes, discriminated against students in less affluent school districts and interfered with the students' fundamental right to education. The Supreme Court rejected both of these arguments, holding that the state finance system did not violate equal protection or interfere with a fundamental right. Under the Supreme Court's equal protection jurisprudence, "the general rule is that legislation is presumed to be valid and will be sustained if the classification drawn by the statute is rationally related to a legitimate state interest," although laws that are based on suspect classifications such as race or gender or that interfere with a fundamental right typically receive heightened scrutiny and require a stronger, if not compelling, state interest to justify the classification or infringement. The Rodriguez Court, however, concluded that the Texas financing system did not discriminate against any definable category of poor people or result in the absolute deprivation of education and therefore held that there was no impermissible classification based on wealth and no discrimination against a suspect class. Likewise, the Court found that the Constitution did not explicitly or implicitly guarantee a right to education and that there was no evidence that the Texas financing system resulted in an education so inadequate that it interfered with the ability to exercise other fundamental constitutional rights. The Court's holding that there was no discrimination against a suspect class and no interference with a fundamental right was important because it determined the degree of judicial scrutiny that the Texas financing system received. Had the Court found a violation of equal protection or infringement of a fundamental right, then the Texas school funding system would have been subject to strict scrutiny and the state would have been required to offer a compelling state interest as justification for the system. In the absence of such a finding, however, the Texas financing system was subject to rational basis review. Under that standard, the Court upheld the state funding system as rationally related to the legitimate state interest of maintaining local control over matters involving education and taxation. As noted above, the Rodriguez case foreclosed school finance claims based on the federal constitution and prompted plaintiffs to file lawsuits based on state constitutional claims instead, thereby transforming education finance litigation into an issue of state law. This section discusses the two major legal theories involved in state education finance litigation—equity and adequacy—as well as leading cases in these areas. Initially, litigants in school finance cases focused on the issue of equity. Arguing that the funding disparities among school districts were inequitable, the plaintiffs in these cases contended that such inequities were unconstitutional and should be remedied by equalizing funding among all school districts. Although the U.S. Supreme Court had rejected arguments based on the Equal Protection Clause of the U.S. Constitution, advocates for school financing reform typically based their new legal claims on equal protection provisions found within the constitutions of individual states. For example, in Serrano v. Priest , which is the most prominent example of an equity-based education finance claim, the Supreme Court of California held that the state finance system for public schools violated the equal protection provisions in the California constitution because "discrimination in educational opportunity on the basis of district wealth involves a suspect classification, and ... education is a fundamental interest." Although an equity-based litigation strategy was effective in some of the early cases: [The] difficulties of actually achieving equal educational opportunity through the fiscal neutrality principle, as well as political resistance to judicial attempts to enforce court orders in the initial fiscal equity cases, seem to have dissuaded other state courts from venturing down this path. Despite an initial flurry of pro-plaintiff decisions in the mid-1970s, by the mid-1980's, the pendulum had decisively swung the other way: plaintiffs won only two decisions in the early '80s, and, as of 1988 ... 15 of the State Supreme Courts had denied any relief to the plaintiffs ... compared to the seven states in which plaintiffs had prevailed. In part, this shift may have occurred because state courts and legislatures experienced implementation difficulties when attempting to equalize funding among school districts and because court decisions that required equal resources did not necessarily ensure equal or adequate educational opportunities. As a result of this diminished success with equity-based claims, plaintiffs in school financing cases began bringing school finance claims based on adequacy theories instead. Although state courts continued to analyze education finance cases in terms of equal protection, the courts gradually began to examine other considerations, notably arguments regarding educational adequacy. Specifically, rather than rely on the argument that school funding disparities were a violation of equal protection, some plaintiffs began arguing that inadequate funding levels resulted in a violation of state constitutional provisions that guaranteed an adequate education. Most of these claims were based on provisions found in virtually all state constitutions that require states to establish a system of free public schools and provide students with a "thorough," "efficient," or "adequate" education. For example, in the early case Robinson v. Cahill , the Supreme Court of New Jersey interpreted a state constitutional provision that required the legislature to provide for "a thorough and efficient system of free public schools," and the court concluded that "we do not doubt than an equal educational opportunity for children was precisely in mind" and "the obligation is the State's to rectify." As a result, the court ruled that the New Jersey school finance system was unconstitutional but left it to the legislature to devise a solution that would compel localities to provide equal educational opportunities to their students. In another significant adequacy case, Rose v. Council for Better Education , the Supreme Court of Kentucky evaluated the claim that the state education financing scheme was inadequate and therefore a violation of a state constitutional provision that requires the legislature to "provide for an efficient system of common schools." The court not only found such a violation, but held that "Kentucky's entire system of common schools is unconstitutional" because the entire system is "underfunded and inadequate" and "fraught with inequalities and inequities." The court then held that every child "must be provided with an equal opportunity to have an adequate education" and set forth educational standards to define what constitutes an adequate education. Currently, state education finance litigation typically involves adequacy-based claims. As one commentator notes, "Adequacy has become the predominant theme of the recent wave of state court decisions because the adequacy approach resolves many of the legal problems that had arisen in the early fiscal equity cases and because it provides the courts judicially manageable standards for implementing effective remedies." Regardless of whether such lawsuits involve equity or adequacy theories, education finance litigation has thus far been brought in 45 out of 50 states.

Over the past several decades, a series of lawsuits have challenged funding disparities that exist among school districts within the states. Spurred by concerns that such disparities discriminated against students in poor school districts or resulted in an inadequate education, school finance plaintiffs began filing lawsuits in federal and state courts based on theories involving educational equity or adequacy. This report provides an analysis of litigation regarding school financing, including an overview of the legal issues involved in such litigation and a description of the leading school finance cases at both the federal and state level.

Most civilian federal employees participate in one of two federal retirement systems. In general, employees hired before 1984 are covered by the Civil Service Retirement System (CSRS) and those who were hired in 1984 or later are covered by the Federal Employees' Retirement System (FERS). Employees enrolled in CSRS do not pay Social Security taxes and do not earn Social Security benefits based on their employment in the federal government. Employees enrolled in FERS pay Social Security taxes and earn Social Security benefits. Employees in either system can contribute to the Thrift Savings Plan (TSP), but only employees enrolled in FERS receive employer matching contributions. As governmental plans, CSRS and FERS are not subject to the Employee Retirement Income Security Act of 1974 (ERISA; P.L. 93-406 ), which governs many aspects of employer-sponsored retirement plans in the private sector. ERISA establishes certain rights for the spouses and former spouses of participants in private-sector plans. To protect spouses and former spouses, ERISA requires that the default form of benefit in a defined benefit pension plan must be a joint and survivor annuity with at least a 50% survivor benefit; a retirement plan must comply with the terms of a qualified domestic relations order (QDRO) issued by a state court that divides retirement benefits between the parties to a divorce; the written consent of both spouses must be secured in order for a married participant in a defined contribution plan to name anyone other than his or her spouse as the beneficiary if the participant were to die; and the default form of annuity in a defined contribution plan that offers this form of benefit must be a joint and survivor annuity. Retirement benefits for federal employees are governed by chapters 83 (CSRS) and 84 (FERS) of Title 5 of the United States Code. These chapters establish rights of the spouse or former spouse of a current or former federal employee that are similar in many respects to those established by ERISA for private-sector plans; however, there are a few important differences. For example, like ERISA, Title 5 requires the default form of benefit under CSRS and FERS to be a joint and survivor annuity, and both ERISA and Title 5 require the written consent of the participant and spouse in order to waive the survivor annuity. On the other hand, while both ERISA and Title 5 allow a pension to be divided between the parties to a divorce, the laws differ with respect to when pension payments to the former spouse can begin. Under ERISA, a court can require a plan to begin paying benefits to the former spouse when the plan participant has reached the earliest retirement age under the plan, regardless of whether the participant has yet retired. In contrast, even if a state court decree of divorce or annulment has awarded a share of a federal employee's retirement annuity to a former spouse, Title 5 prohibits payment of any part of a CSRS or FERS annuity to a former spouse until the employee has separated from federal service, is eligible to receive a CSRS or FERS annuity, and has applied for an annuity. Another difference between ERISA and Title 5 is in the designation of beneficiaries in defined contribution plans. ERISA requires a married participant in a defined contribution plan to secure the written consent of his or her spouse in order to name anyone other than the spouse as the plan beneficiary in the event of the participant's death. In contrast, federal regulations allow a participant in the Thrift Savings Plan for federal employees to name anyone as the plan beneficiary in the event of the participant's death "without the knowledge or consent of any person, including his or her spouse." A state court decree of divorce, annulment, or legal separation can award a former spouse of a federal employee either a share of the employee's retirement annuity, a survivor annuity, or both types of annuity. To award a former spouse both a share of the employee's retirement annuity and a survivor annuity, the court order must specify both benefits. The Office of Personnel Management (OPM) will pay only the benefits that are specified in the court order. Section 8346 of Title 5 generally exempts CSRS from the proceedings of state courts. However, Section 8345 of Title 5 allows a former spouse of a federal employee to be awarded a share of the employee's CSRS retirement annuity in accordance with the terms of a state court decree of divorce, annulment, or legal separation or a property settlement pursuant to such decree. OPM will divide the retired employee's monthly annuity as directed by the court order and pay the specified share to the former spouse. Only payments made after OPM receives the court order will be divided between the employee and his or her former spouse. OPM will not execute a court order dividing a federal employee's retirement annuity until the employee has separated from federal service, is eligible for an annuity, and has applied for an annuity. The right of a former spouse to receive a share of a retired federal employee's retirement annuity terminates when the retired employee dies. For the former spouse to receive a survivor annuity, either the retiree must have elected a survivor annuity for the former spouse or a court order must specify that the former spouse is to receive a survivor annuity. A former spouse of a deceased federal employee may receive a CSRS survivor annuity if the employee elected a survivor annuity for the former spouse or if a state court decree of divorce, annulment, or separation requires a survivor annuity. A CSRS survivor annuity is 55% of the single-life annuity that the retired worker would have received. To fund the joint and survivor annuity, the retired worker's annual pension is reduced by 2.5% of the first $3,600 plus 10% of the annuity above that amount. This entitles the worker's spouse or former spouse to a survivor annuity equal to 55% of the worker's full annuity before the reduction for survivor benefit is taken into account. The sum of CSRS survivor annuities paid to the employee's spouse at the time of death and all former spouses cannot exceed 55% of the single-life annuity to which the annuitant was entitled. If the full amount of a survivor annuity has been awarded to a former spouse through a court order, the employee's current spouse is not entitled to receive a survivor annuity unless the former spouse has died or remarried before the age of 55. A survivor annuity paid to a former spouse of a federal employee terminates when the former spouse dies or if he or she remarries before the age of 55. There is an exception to the termination of a survivor annuity paid to a former spouse in the case of remarriage prior to age 55 if the former spouse's marriage to the employee lasted at least 30 years (applicable to remarriages that have occurred on or after January 1, 1995). If the remarriage ends in death, divorce, or annulment, the annuity restarts in the same amount. An employee's election to provide a survivor annuity, or a court order awarding a survivor annuity to a former spouse, can be modified only before the employee retires or dies. A court order awarding a survivor annuity to a former spouse of an employee will not be honored by OPM if the former spouse previously waived his or her right to a survivor annuity. If an employee separating from federal service elects to receive a refund of his or her contributions to the retirement system, he or she forfeits the right to receive a CSRS annuity. Section 8342 of Title 5 allows a state court to block payment of a refund if a former spouse has been awarded a share of the employee's annuity or a survivor annuity. Section 8470 of Title 5 generally exempts FERS from the proceedings of state courts. However, Section 8467 allows a FERS retirement annuity to be divided between a federal annuitant and a former spouse, pursuant to a state court decree of divorce, annulment, or legal separation. OPM will divide the retired employee's monthly annuity as directed by the court order and pay the specified share to the former spouse. Only payments made after OPM receives the court order will be divided between the employee and his or her former spouse. OPM will not execute a court order dividing a federal employee's retirement annuity until the employee has separated from federal service, is eligible for an annuity, and has applied for an annuity. The right of a former spouse to receive a share of a retired federal employee's retirement annuity terminates when the retiree dies. For the former spouse to receive a survivor annuity, either the retiree must have elected a survivor annuity for the former spouse or a court order must specify that the former spouse is to receive a survivor annuity. Section 8445 of Title 5 allows a federal employee to elect a FERS survivor annuity for a former spouse, and it permits a state court to award a former spouse of a federal employee a survivor annuity in the event that the employee predeceases the former spouse. A survivor annuity under FERS is equal to 50% of the single-life annuity to which the retired worker would have been entitled. The joint and survivor annuity is funded by reducing the retiree's single-life annuity amount by 10%. In return for this reduction, the worker's spouse or former spouse is entitled to a survivor annuity equal to 50% of the worker's full annuity before the reduction is taken into account. An employee may provide for the equivalent of no more than one FERS spouse survivor annuity. The sum of FERS survivor annuities paid to the employee's spouse at the time of death and all former spouses cannot exceed 50% of the single-life annuity to which the annuitant was entitled. If the full amount of a survivor annuity has been awarded to a former spouse through a court order, the employee's current spouse is not entitled to receive a survivor annuity unless the former spouse has died or remarried before the age of 55. A survivor annuity terminates when the spouse or former spouse dies or if he or she remarries before the age of 55. In the case of remarriage prior to age 55, there is an exception to the termination of a survivor annuity paid to a former spouse if the former spouse's marriage to the employee lasted at least 30 years (this exception applies to remarriages that have occurred on or after January 1, 1995). If the remarriage ends in death, divorce, or annulment, the annuity restarts in the same amount. An election to provide a FERS survivor annuity or a court order awarding a FERS survivor annuity to a former spouse can be modified only before the employee retires or dies. A court order awarding a survivor annuity to a former spouse of an employee will not be honored by OPM if the former spouse previously waived his or her right to a survivor annuity. If an employee participating in FERS dies after having completed at least 18 months of service, but fewer than 10 years of service, his or her spouse is eligible for a lump-sum survivor benefit equal to one-half of the employee's annual basic pay plus a lump-sum payment (approximately $31,786 in 2014). This lump-sum survivor benefit may be paid to a former spouse or divided between a current and former spouse, pursuant to a state court order. If an employee dies after completing at least 10 years of service, the surviving spouse (or former spouse, pursuant to a court order) receives a lump sum and an annuity equal to 50% of the annuity that the employee had earned at the time of his or her death. A separating employee who elects to receive a refund of contributions to the retirement system forfeits the right to receive a FERS annuity. A state court can block this refund if a former spouse has been awarded a share of the employee's FERS retirement annuity or a FERS survivor annuity. An employee or former employee can designate a beneficiary or beneficiaries who will receive his or her TSP account balance in the event of the participant's death. This must be done by filing Form TSP-3 with the Federal Retirement Thrift Investment Board. The Thrift Board is not authorized to recognize wills or other estate planning documents. A married participant is not required to designate his or her spouse as the beneficiary of the TSP account, nor is the spouse's consent required to designate someone other than the spouse as the beneficiary of the TSP account. A married FERS participant must obtain his or her spouse's written consent before receiving a loan from his or her TSP account, receiving an in-service distribution from the TSP, and withdrawing money from the TSP after leaving federal employment. CSRS participants are not required to obtain the spouse's written consent, but the spouse will be notified by the TSP before a loan is approved or in the event of an in-service or post-employment withdrawal from the TSP. The spouse of a married FERS participant is legally entitled to a joint and survivor annuity with 50% survivor benefit from the TSP. The participant's spouse must waive his or her right to that annuity in writing before the participant can withdraw money from the TSP. The TSP is authorized to recognize state court orders of divorce, annulment, or legal separation and property settlements pursuant to a court order. The TSP also is authorized to recognize state court orders respecting payment of alimony and child support. Federal employees enrolled in FERS participate in Social Security. The former spouse of a worker is eligible for a Social Security spouse's benefit at the age of 62 if the couple were married for at least 10 years, and if the worker is receiving, or is entitled to, Social Security benefits. If the former spouse of the worker remarries, he or she generally cannot collect benefits on the worker's record unless the marriage ends by death, divorce, or annulment. The divorced spouse of a worker insured by Social Security can receive widow or widower benefits if the couple were married at least 10 years. Survivor benefits terminate if the divorced spouse remarries before the age of 60 unless the later marriage ends, by death, divorce, or annulment. Remarriage does not affect Social Security survivor benefits being paid to the children of a deceased worker.

A former spouse of a federal employee may be entitled to a share of the employee's retirement annuity under the Civil Service Retirement System (CSRS) or the Federal Employees' Retirement System (FERS) if this has been authorized by a state court decree of divorce, annulment, or legal separation. An employee also may voluntarily elect a survivor annuity for a former spouse. A state court can award a former spouse a share of the employee's retirement annuity, a survivor annuity, or both. A court also can award a former spouse of a federal employee a portion of the employee's Thrift Savings Plan (TSP) account balance as part of a divorce settlement.

On November 4, 2002, United States Trade Representative (USTR) Robert B. Zoellick notified Congress of the Administration's intention to launch negotiations for a free trade agreement (FTA) with the Southern African Customs Union (SACU), comprised of Botswana, Namibia, Lesotho, South Africa, and Swaziland. This agreement would be the first U.S. FTA with a Sub-Saharan African country. The first round of negotiations for the SACU FTA began on June 3, 2003, in Johannesburg, South Africa. The negotiations were initially scheduled to conclude by December 2004, but the deadline was pushed to the end of 2006 after negotiations stalled in late 2004 and resumed in late 2005. The talks continued to move at a slow pace until April 2006, when U.S. and SACU officials decided to suspend negotiations and instead begin a longer term joint work program. On July 16, 2008, USTR Susan Schwab signed a Trade, Investment and Development Cooperation Agreement (TIDCA) with trade ministers from SACU. Several possible rationales exist for the negotiation of an FTA with SACU. One impetus derives from Sec. 116 of the African Growth and Opportunity Act (AGOA) (Title I, P.L. 106 - 200 ), in which Congress declared its sense that FTAs should be negotiated with sub-Saharan African countries to serve as a catalyst for trade and for U.S. private sector investment in the region. Such trade and investment could fuel economic growth in Southern Africa, by creating new jobs and wealth. SACU member countries have achieved the most robust export growth under AGOA, and an FTA may expand their access to the U.S. market. An FTA may also encourage the continued economic liberalization of the SACU members, and it could move SACU beyond one-way preferential access to full trade partnership with the United States. Finally, although SACU is a customs union, its members' investment and regulatory regimes are not fully harmonized. A comprehensive FTA with the United States could force SACU to achieve greater harmonization. A potential U.S.-SACU FTA is of interest to Congress because: (1) Congress will need to consider ratifying any agreement signed by the parties; (2) provisions of an FTA may adversely affect U.S. business in import-competing industries, and may affect employment in those industries; and (3) an FTA may increase the effectiveness of AGOA and bolster its implementation. On January 9, 2003, a bipartisan group of 41 Representatives wrote to Ambassador Zoellick to support the beginning of FTA negotiations with SACU. The U.S. business community has also shown interest in a U.S.-SACU FTA. The U.S.-South African Business Council, an affiliate of the National Foreign Trade Council, announced the creation of an FTA advocacy coalition in December 2002. The Corporate Council on Africa, a U.S. organization dedicated to enhancing trade and investment ties with Africa, also supports the negotiations. For these business groups, a primary benefit of an FTA with SACU would be to counteract the free trade agreement between the European Union and South Africa, which has given a price advantage to European firms. The FTA could also provide an opportunity to address the constraints on U.S. exports to SACU countries, such as relatively high tariffs, import restrictions, insufficient copyright protection, and service sector barriers. Some U.S. businesses have reportedly expressed skepticism about an FTA with SACU, citing concerns over corruption and inadequate transparency in government procurement, particularly in South Africa. On December 16, 2002, the interagency Trade Policy Staff Committee, which is chaired by the USTR, held a hearing to receive public comment on negotiating positions for the proposed agreement. Several groups representing retailers, food distributors, and metal importers supported the reduction of U.S. tariffs on SACU goods that an FTA would bring. Others representing service industries and recycled clothing favored negotiations to remove tariff and non-tariff barriers in the SACU market. Yet other groups opposed the additional opening of U.S. markets to SACU goods or sought exemptions for their products. They included the growers and processors of California peaches and apricots, the American Sugar Alliance, rubber footwear manufacturers, and producers of silicon metal and manganese aluminum bricks. Some U.S. civil society organizations are concerned that a SACU FTA could have negative consequences for poor Southern Africans, citing potential adjustment costs for import-competing farmers, poor enforcement of labor rights, privatization of utilities, and increased restrictions on importing generic drugs to treat HIV/AIDS. The South African Customs Union consists of Botswana, Lesotho, Namibia, South Africa, and Swaziland: five contiguous states with a population of 51.9 million people encompassing 1.7 million square miles on the southern tip of the African continent. Although this figure represents less than 1% of the population of sub-Saharan Africa, SACU accounts for one-half of the subcontinent's gross domestic product (GDP). Wide differences exist among the economies of SACU. While South Africa has developed a significant manufacturing and industrial capacity, the other countries remain dependent on agriculture and mineral extraction. The grouping is dominated by South Africa, which accounts for 87% of the population, and 93% of the GDP of the customs area. SACU member states had combined real GDP of about $158 billion in 2005. SACU is the United States' second largest trading partner in Africa behind Nigeria whose exports are almost exclusively petroleum products. Overall, SACU is the 33 rd largest trading partner of the United States. Merchandise imports from SACU totaled $10.0 billion in 2007, a 33% increase from 2005 and a 169% increase from 1997. They were composed of minerals such as platinum and diamonds, apparel, vehicles, and automotive parts. Major U.S. exports to the region include aircraft, automobiles, computers, medical instruments and construction and agricultural equipment. The 2007 merchandise trade deficit with SACU was $4.4 billion. The United States ran a services trade surplus with South Africa (the only member of SACU for which service data are available) with exports of $1.6 billion and imports of $1.1 billion in 2006. Services trade between the United States and South Africa has increased steadily over the last decade, with both imports and exports doubling since 1996. The stock of U.S. foreign direct investment in South Africa totaled $3.8 billion in 2006 and was centered around manufacturing, chemicals and services. The stock of South African investment in the U.S. stood at $652 million in 2006. FTA negotiations with SACU may result in the first U.S. trade agreement with an existing customs union. SACU is the world's oldest customs union; it originated as a customs agreement between the territories of South Africa in 1889. The arrangement was formalized through the Customs Agreement of 1910 and was renegotiated in 1969. In 1994, the member states agreed to renegotiate the treaty in light of the political and economic changes implicit from the end of the apartheid regime. The renegotiated agreement was signed on October 21, 2002 in Gaborone, Botswana, and it is now being implemented. Some observers are concerned that further integration of the customs union may be threatened by individual member countries signing economic partnership agreements (EPAs) with the European Union (EU), because these agreements would include policies that SACU has yet to harmonize, such as rules of origin and customs procedures. Some observers believe that SACU should only negotiate these policies as a group to avoid roadblocks to harmonization. The 2002 Agreement provides for greater institutional equality of the member states and effectively redistributes tariff revenue within the member states. Its three key policy provisions are: the free movement of goods within SACU; a common external tariff; and a common revenue pool. It also provides more institutional clout to Botswana, Lesotho, Namibia, and Swaziland (BLNS) in decision-making by creating a policymaking Council of Ministers. The agreement enhances the existing Customs Union Commission, and it creates a permanent Secretariat based in Windhoek, Namibia. The Agreement renegotiated the formula for disbursement of the common revenue pool, which accounts for a large portion of government revenue in the BLNS countries. BLNS disbursements were specified under the old formula, but under the new formula they are variable and based on shares of intra-SACU trade. Both formulas result in a redistribution of SACU tariff revenues from South Africa to BLNS, but the new formula has its basis in some measure of economic activity. Recent estimates indicate SACU payments accounted for 49% of government revenue in Lesotho, 69% in Swaziland, 25% in Namibia, 12% in Botswana, and 3% in South Africa in 2005. A 2003 WTO Trade Policy Review of SACU member states examined the tariff structure and trade posture of the customs union. It noted that the South African tariff structure, which was still the basis for the SACU tariff, was relatively complex, consisting of specific, ad valorem , mixed compound and formula duties. However, the South African government has embarked on a tariff rationalization process to simplify the tariff schedule, to convert tariff lines to ad valorem rates, and to remove tariffs on items not produced in the SACU. According to the USTR, the complexity of the tariff regime has made it necessary for some U.S. firms to employ facilitators to export to South Africa. The WTO found applied MFN tariffs averaged 11.8% in manufacturing, 5.5% in agriculture, and 0.7% in mining and quarrying. These average tariffs represent a reduction from the previous WTO review in 1998, when MFN tariffs averaged 16%, 5.6%, and 1.4%, respectively. However, tariffs are often bound much higher, with some bindings as high as 400%. After nearly three years of slow-moving and stalled negotiations, U.S. and SACU trade officials called off the FTA negotiations in April 2006 in favor of a longer term trade and investment work plan. On July 16, 2008, they signed a Trade, Investment and Development Cooperation Agreement (TIDCA), which is the first of its kind. The TIDCA is reportedly a formal mechanism for the United States and SACU to negotiate interim trade-related agreements which may serve as the building blocks for a future FTA. The agreement will also allow the two parties to work on key issues in their trade, such as trade facilitation, technical barriers, investment promotion, and sanitary and phytosanitary standards. Observers have cited several possible reasons for the halt in FTA negotiations. First, the United States and SACU did not agree on the scope of the negotiations. Per their mandate from Congress to pursue comprehensive FTAs, U.S. negotiators attempted to proceed with negotiations including intellectual property rights, government procurement, investment, and services provisions. However, SACU officials reportedly argued for these provisions to be excluded from the negotiations. They called for making market access commitments first, and then negotiating the other areas. Now that Congress has extended the AGOA benefits to 2015 through the AGOA Acceleration Act of 2004 ( P.L. 108 - 274 ), there may be less incentive for SACU countries to complete an FTA with the United States. Also, the United States and SACU reportedly held different views on how to include certain industrial sectors in the negotiations. The United States preferred what is called a negative list, where all industries are negotiable unless specifically excluded. Meanwhile, SACU preferred a positive list, where the industries to be included in the negotiations are specified in advance, and additional industries may be included in the agreement over time. Finally, the United States and SACU differed on issues concerning labor rights and environmental regulations. Some observers have speculated that South Africa may be leery of negotiating issues that are included in the current WTO negotiations, so as not to influence their positions in the WTO. Former USTR Robert Zoellick has stated that the United States recognizes that SACU is still an emerging entity. It has not developed harmonized policies on many of the issues that would be included in an FTA, which may add to the challenges of negotiating an FTA.

Negotiations to launch a free trade agreement (FTA) between the United States and the five members of the Southern African Customs Union (SACU) (Botswana, Lesotho, Namibia, South Africa, and Swaziland) began on June 3, 2003. In April 2006, negotiators suspended FTA negotiations, launching a new work program on intensifying the trade and investment relationship with an FTA as a long term goal. A potential FTA would eliminate tariffs over time, reduce or eliminate non-tariff barriers, liberalize service trade, protect intellectual property rights, and provide technical assistance to help SACU nations achieve the goals of the agreement. This potential agreement would be subject to congressional approval. This report will be updated as negotiations progress.

RS21213 -- Colombia: Summary and Tables on U.S. Assistance, FY1989-FY2004 Updated May 19, 2003 While the United States has been providing counternarcotics (CN) assistance to Colombia at least as far back as the mid-1970s, former President George H.W. Bushdramatically increased CN aid to Colombia through his 1989 "Andean Initiative." Grant aid to Colombia hadincreased gradually, albeit not evenly, through the1980s, as Colombia evolved from a major supplier of marijuana to the United States, to nearly the sole supplier ofcocaine. By the end of the 1980s, with coca leafcultivation and cocaine production rising in the Andean region, and Colombia suffering increased political violencefrom the Medellin drug-trafficking cartel, theformer Bush Administration established its new CN program. Under this region-wide initiative, the United Statessubstantially increased State Department supportfor Colombian CN efforts, and provided Colombian security forces, primarily the police, with equipment throughforeign military financing grants and DODequipment drawdowns. As part of the effort to bring military resources to bear on the "war against drugs," in 1991,Congress enacted "Section 1004" of the 1991National Defense Authorization Act (NDAA) ( P.L.101-510 ). This provides the DOD with authority to providetransportation, reconnaissance, training, intelligence,and base support when requested by foreign law enforcement agencies for CN purposes. Funding for Colombia dropped in the first two years of the Clinton Administration budgets. It began to increase in FY1997, with increased attention to eradicationefforts. Until FY1998, however, the numbers fell short of the Bush years. (1) In 1998, Congress established a new authority, Section 1033 of the1998NDAA ( P.L.105-85 ), for the U.S. military to provide non-lethal equipment, and to maintain and repair counter-drug equipment. Table 2 details funding for the eleven yearsfrom FY1989 - FY1999, which totals $1,066.7 million (i.e., $1.07 billion). The 1998 election of a new Colombian president, Andres Pastrana, led to a reevaluation of U.S. policy and greater cooperation. During Pastrana's October 1998state visit, President Clinton announced that the United State would provide nearly three times more assistance toColombia during FY1999 than it had the previousyear. Much of this, however, was the $173.2 million in congressionally-mandated supplemental appropriationsfunding ( P.L. 105-277 ) for helicopter and aircraft upgrades, radar, andpolice assistance that the Administration had not requested. In FY2000, the funding again rose substantially withthe "Plan Colombia" legislation. In July 2000, Congress approved the Clinton Administration's request for $1.3 billion in FY2000 State Department and DOD emergency supplemental appropriations ( P.L. 106-246 ) forthe region-wide "Plan Colombia," of which $860.3 was earmarked for Colombia. Nearly half of the Colombiafunding was dedicated to the "Push into Southern Colombia" program toset up and train two new Colombian Army Counternarcotics battalions (CACBs), which combined with an existingone set up earlier by the United States to form a brigade of some2,700. The brigade assists the Colombian National Police (CNP) in the fumigation of illicit narcotics crops and thedismantling of laboratories, beginning with coca fumigation in thesouthern provinces of Putumayo and Caquetá, where coca cultivation was spreading rapidly. Congress alsoprovided substantial assistance for economic development, displacedpersons, human rights monitors, and administration of justice and other governance programs, all intended to helpColombia counter the many threats to its stability and integrity fromthe trafficking of illegal narcotics. With its FY2002 budget request, the Bush Administration expanded the scope of Clinton's "Plan Colombia" policy through its Andean Regional Initiative (ARI), with continuing highlevels of support for existing "Plan Colombia" programs in Colombia, and increased assistance to states borderingor close to Colombia. Congress provided $380.5 million, nearly all ofthe Administration's requested $399 million, for Colombia in State Department counternarcotics funding in theFY2002 foreign operations appropriations ( P.L. 107-115 ). (2) As inprevious years, the appropriations bill included human rights and other conditions, and a cap on the numberdeployed of military personnel and of private contractors who are U.S.citizens. In February 2002, through requests for FY2002 emergency supplemental appropriations and FY2003 regular appropriations, the Bush Administration sought authority and funding toexpand the scope of military assistance. In both requests, it asked for foreign military financing (FMF) funds to trainand equip Colombian soldiers to defend oil pipelines and otherinfrastructure from attacks by leftist guerrillas, in addition to funding for Plan Colombia programs. Thesupplemental request also sought funding to train Colombian security forces inanti-kidnapping techniques. In addition, the supplemental submission proposed to broaden the authorities of theDefense and State Departments to use FY2002 and FY2003 assistanceand unexpended Plan Colombia ( P.L. 106-246 ) aid to support the Colombian government's "unified campaignagainst narcotics trafficking, terrorist activities, and other threats to itsnational security." In the month before Colombia's new president, Alvaro Uribe, took office in August 2002, Congress provided almost all of the requested supplemental funding and expanded the scopeof military assistance permitted with those and previous-fiscal year funds. With the FY2002 supplementalappropriations (Section 305, P.L. 107-206 ), Congress provided authority forthe Administration to use counternarcotics and other funds to support Colombia's "unified campaign" againstnarcotics trafficking and against activities by organizations designated asterrorist organizations, naming specifically the two major leftist guerrilla groups, the Revolutionary Armed Forcesof Colombia and the National Liberation Army, and the rightist UnitedSelf-Defense Forces of Colombia, as well as in emergency circumstances. Congress, however, did not provideexpanded authority for activities involving any other national securitythreats. Congress extended the authority for State Department FY2003 funding in the omnibus FY2003appropriations bill ( P.L. 108-7 , under the heading "Andean CounterdrugInitiative"), passed in February 2003, which included annual State Department appropriations, and for DOD fundingin the FY2003 defense appropriations bill (Section 8145, P.L.107-248 ). Congress approved just $5 million shy of the $537 million the Bush Administration requested in CN($433.2 million) and FMF ($93 million) funding. In the FY2003supplemental appropriations ( P.L. 108-11 ), Congress included $105 million for Colombia: $34 million in StateDepartment CN funding, $34 million in DOD CN funding, and $37.1million in FMF funding. Both bills condition aid on the observance of human rights and environmental and otherrestrictions. For FY2004, the Bush Administration has requested $573 million for Colombia, including $463 million in Andean Counterdrug Initiative (ACI) funds, and $110 million in ForeignMilitary Financing. It has also requested military funding for Colombia that, for the first time since Plan Colombiawas adopted, is not requested for a very specific purpose. TheAdministration request states that FMF for Colombia is intended "to support counter-terrorism operations andprotect key infrastructure such as the oil pipeline." Table 1 shows aid to Colombia from FY2000 through FY2003 and the FY2004 request. Table 2 shows aid from FY1989-FY1999. (For more information, see CRS Report RL30541 , CRS Report RL31016 , and CRS Report RL31383(pdf) .) Tables 1 and 2 include direct U.S. foreign assistance (i.e., the categories usually counted as U.S. foreign aid, which are in italics ) as well as the costs of goods and services provided toColombia from other U.S. government programs supporting CN efforts there. These figures were taken frompublically-available documents or provided directly by the Departments ofState and Defense. The United States also provides a small amount of DOD Excess Defense Articles (EDA) toColombia. These charts provide as comprehensive a picture as possible of U.S. assistance to Colombia, but there are limitations. For instance, some funds are spent in Colombia on counternarcoticsand other activities that are considered part of U.S. programs: for instance, the Drug Enforcement Administration(DEA) spends its own funds on joint operations in Colombia. Otherfunds are provided through regional programs of USAID and other programs which are not counted as assistanceon a country-by-country basis. No attempt was made to estimate suchfunds. Also, there are inconsistencies among various sources. Because of these and other constraints on gatheringdata, the amount of assistance provided to Colombia may be largerthan the amounts cited in these tables. Table 1. U.S. Assistance to Colombia FY2000-FY2004 (Obligations andauthorizations, $ millions) Notes: NA = Not Available. Figures on State Department INC (International Narcotics Control), ACI (Andean Counterdrug Initiative), USAID, FMF, and IMETfunding from StateDepartment Congressional Presentations, budget justification documents, and allocation information provided bythe Department of State. Figures on INC Air Wing (FY2000-FY2004)provided by the State Department: figures provided May 5, 2003. (INC Air Wing funding supports the sprayeradication efforts. FY2000 figure includes $5.5 million in support of theColombian Army.) Figures on DOD 1004, 1004/124, and 1033 funding provided April 11, 2002, for FY2000-2002;and April 18, 2003, for FY2003 and FY2004. Both INC Air Wingand DOD funding are taken from regional accounts, therefore the FY2003 and FY2004 allocations are estimates,and can be shifted to respond to developing needs in other areas. a FY2000 and thereafter, non-DOD Plan Colombia funds are all assigned to the State Department INC (FY2000 and FY2001) or ACI (FY2002 and thereafter) account; the StateDepartment transfers them to the other agencies carrying out programs in Colombia with those funds. These includethe Department of Justice and USAID. The USAID FY2000 andFY2001 figures are Economic Support Funds (ESF). These USAID figures do not include funds provided to USAIDfrom the INC account. Table 2. U.S. Aid to Colombia FY1989-FY1999 (Obligations and Authorizations, $ millions) Sources: Data is drawn from a number of sources, not all of which are consistent. These include: various editions of the U.S. Overseas Loans and Grants and Assistance fromInternational Organizations "Green Book," prepared by the US AID budget office; various editions of the ForeignMilitary Sales, Foreign Military Construction Sales, and MilitaryAssistance Facts book, prepared by the Department of Defense Security Cooperation Agency; information provideddirectly by the departments of State and Defense that are notrecorded in these publications; and by the General Accounting Office (GAO) for 1996-1998. (See GAO-01-26)Where contradictions existed, GAO data was preferred. Because of apossible lack of data or inaccuracies, some yearly totals may be understated or overstated, particularly prior toFY1997. a In these years, there was assistance in this category of less than $50,000. b Although it is likely that Section 1004 assistance was provided to Colombia as far back asFY1992, there is no public breakdown of such assistance until FY1997. That is the first yearin which DOD provided a publicly-available breakdown by country and authority for funding from its centralcounternarcotics account. c Not included in totals.

Over the past 15 years, from FY1989-FY2003, the United States has providedColombia with over $3.6 billion inassistance, most of it directed to counternarcotics or related efforts. During the first 11 fiscal years(FY1989-FY1999), when assistance totaled just over $1 billion,the annual levels were considerably lower than during the past three fiscal years and the current fiscal year. FromFY2000-FY2003, assistance totals about $2,556billion. The Clinton Administration increased assistance in FY2000 to fund its "Plan Colombia" programs tocounter the spread of coca cultivation in southernColombia. The Bush Administration has continued "Plan Colombia" programs through its Andean Regional Initiative(ARI), which also provides increased funding forColombia's neighbors. In FY2002, President Bush also sought authority to expand the circumstances under whichfunding for the Colombian security forces can beused. As approved by Congress in 2002 and 2003, funding for FY2003 and previous years can be used forcounternarcotics and anti-terrorist purposes. For FY2004, the Bush Administration has requested $573 million in State Department Andean CounterdrugInitiative and Foreign Military Financing funds, andestimates it will spend some $45 million in Colombia from the central State Department Air Wing account. TheDepartment of Defense (DOD) estimates that itwill spend almost $119 million for Colombia from its central counternarcotics account.

This report provides a cumulative history of Department of Energy (DOE) funding for renewable energy compared with funding for the other energy technologies—nuclear energy, fossil energy, energy efficiency, and electric systems. Specifically, it provides a comparison that covers cumulative funding over the past 10 years (FY2009-FY2018), a second comparison that covers the 41-year period since DOE was established at the beginning of FY1978 through FY2018, and a third comparison that covers a 71-year funding history (FY1948-FY2018) for DOE and predecessor agencies. The final amount of FY2017 Energy and Water Development appropriations for DOE energy technologies was established by the Consolidated Appropriations Act, 2017 ( P.L. 115-31 ), which was signed by the President on May 5, 2017. The act contained appropriations for all FY2017 appropriations bills, including Energy and Water Development programs (Division D). Final funding for FY2018 was set by the Consolidated and Further Continuing Appropriations Act, 2018 ( P.L. 115-141 ), which was signed by the President on May 23, 2018. Funding levels for DOE are included in Energy and Water Development programs (Division D). Figure 1 presents the fiscal year funding totals for DOE in real terms (2016 dollars) since 1978 for each technology or energy source. Table 1 shows the cumulative funding totals in real terms (2016 dollars) for the past 10 years (first column), 41 years (second column), and 71 years (third column). Table 2 converts the data from Table 1 into relative shares of spending for each technology or energy source, expressed as a percentage of total spending for each period. Figure 2 displays the data from the first column of Table 2 as a pie chart. That chart shows the relative shares of cumulative DOE spending for each technology or energy source over the 10 years from FY2009 through FY2018. Figure 3 provides a similar chart for the period from FY1978 through FY2018. Figure 4 shows a chart for FY1948 through FY2018. The availability of energy—especially gasoline and other liquid fuels—played a critical role in World War II. Another energy-related factor was the application of research and development (R&D) to the atomic bomb (Manhattan Project) and other military technologies. During the post-World War II era, the federal government began to apply R&D to the peacetime development of energy sources to support economic growth. At that time, the primary R&D focus was on fossil fuels and new forms of energy derived from nuclear fission and nuclear fusion. The Atomic Energy Act of 1946 established the Atomic Energy Commission (AEC), which inherited all of the Manhattan Project's R&D activities and placed nuclear weapon development and nuclear power management under civilian control. A major focus of the AEC was research on "atoms for peace," the use of nuclear energy for civilian electric power production. Prompted by the oil embargo declared by the Organization of Arab Petroleum Exporting Countries in 1973, the Federal Energy Administration was established in mid-1974. In early 1975, the Energy Research and Development Administration (ERDA) was established, incorporating the AEC and several energy programs that had been operating under the Department of the Interior and other federal agencies. The Department of Energy (DOE) was established by law in 1977, incorporating activities of the FEA and ERDA. All of the energy R&D programs—fossil, nuclear, renewable, and energy efficiency—were brought under its administration. DOE also undertook a small program in energy storage and electricity system R&D that supports the four main energy technology programs. From FY1948 through FY1977, the majority of federal government support for energy R&D focused on fossil energy and nuclear power technologies. Total spending on fossil energy technologies over that period amounted to about $17.1 billion, in constant FY2016 dollars. The federal government spent about $51.6 billion (in constant FY2016 dollars) during that period for nuclear energy R&D (in all the tables and figures in this report, the "nuclear" category includes both fission and fusion). The energy crises of the 1970s spurred the federal government to expand its R&D programs to include renewable (wind, solar, biomass, geothermal, hydro) energy and energy efficiency technologies. Comparatively modest efforts to support renewable energy and energy efficiency began during the early 1970s. Since FY1978, DOE has been the main supplier of energy R&D funding compared to other federal agencies. In real (constant dollar) terms, funding support for all four of the main energy technologies skyrocketed during the 1970s to a combined peak in FY1979 at about $8.6 billion (2016 constant dollars). Funding then dropped steadily, to about $2.0 billion (2016 dollars) per year during the late 1990s. Since then, funding has increased gradually—except that the American Recovery and Reinvestment Act of 2009 ( P.L. 111-5 ) provided a one-year spike of $13 billion (2016 dollars) in FY2009. For FY2018, DOE energy R&D funding stood at nearly $4.5 billion (2016 dollars).

Energy-related research and development (R&D)—on coal-based synthetic petroleum and on atomic bombs—played an important role in the successful outcome of World War II. In the postwar era, the federal government conducted R&D on fossil and nuclear energy sources to support peacetime economic growth. The energy crises of the 1970s spurred the government to broaden the focus to include renewable energy and energy efficiency. Over the 41-year period from the Department of Energy's (DOE's) inception at the beginning of FY1978 through FY2018, federal funding for renewable energy R&D amounted to about 18% of the energy R&D total, compared with 6% for electric systems, 16% for energy efficiency, 24% for fossil, and 37% for nuclear. For the 71-year period from 1948 through 2018, nearly 13% went to renewables, compared with nearly 5% for electric systems, 11% for energy efficiency, 24% for fossil, and 48% for nuclear.

The decision in School District of the City of Pontiac v. Secretary of the United States Department of Education arose in response to litigation surrounding § 9527(a) of the Elementary and Secondary Education Act (ESEA), as amended by the No Child Left Behind (NCLB) Act of 2001. Section 9527(a)—the so-called "unfunded mandates" provision—states, "nothing in this Act shall be construed to authorize an officer or employee of the Federal Government to ... mandate a State or any subdivision thereof to spend any funds or incur any costs not paid for under this Act." Enacted in 2002, the NCLB Act reauthorized and revised the ESEA, which is the primary federal law that provides financial assistance to state and local school districts for pre-collegiate education. Perhaps the most notable feature of NCLB is the wide array of assessment and accountability measures that seek to improve student achievement and performance, particularly in troubled schools. For example, the act mandates that states administer annual tests in reading and mathematics for students in grades 3-8, requires that schools make adequate yearly progress toward improving student performance, establishes a series of required actions for schools that fail to meet such performance standards, and adds new requirements regarding teacher qualifications. The bulk of the new accountability requirements are tied to the Title I, Part A program for disadvantaged students, which is the largest source of federal funding for elementary and secondary education. Arguing that the costs of complying with some of the new accountability measures far outweigh what they receive in federal funds, a number of states and school districts have protested what they perceive as a lack of federal assistance for some of the act's more controversial requirements, such as the testing and school choice provisions. Other critics have questioned whether mandating that states pay for the costs associated with some of the act's requirements is even lawful, given the language of § 9527(a). Indeed, in 2005, the National Education Association (NEA), in conjunction with eight school districts in Michigan, Texas, and Vermont, filed a lawsuit claiming that the Secretary of Education was violating both the "unfunded mandates" provision and the Spending Clause of the U.S. Constitution. The NEA sought a declaratory judgment to the effect that states and school districts are not required to spend non-NCLB funds to comply with the NCLB mandates, and that a failure to comply with the NCLB mandates for this reason does not provide a basis for withholding any federal funds to which they are otherwise entitled under the NCLB. Plaintiffs also sought an injunction prohibiting the Secretary from withholding from states and school districts any federal funds to which they are entitled under the NCLB because of a failure to comply with the mandates of the NCLB that is attributable to a refusal to spend non-NCLB funds to achieve such compliance. In 2005, the United States District Court for the Eastern District of Michigan dismissed the NEA's lawsuit. In its ruling, the district court concluded that § 9527(a) should be interpreted as a prohibition against the imposition by federal officers and employees of additional, unfunded requirements beyond those provided for in the statute, rather than as an exemption from the statute's requirements when the federal government fails to fully fund the Title I program. As a result, the court dismissed the lawsuit for failing to state a claim upon which relief can be granted. The plaintiffs appealed the dismissal to the Court of Appeals for the Sixth Circuit, which reversed the district court's decision. However, the case was subsequently reheard, and the en banc Sixth Circuit divided evenly, meaning that the judgment of the district court to dismiss the case was affirmed. In School District of the City of Pontiac v. Secretary of the United States Department of Education , a three-judge panel of the Sixth Circuit, in a 2-1 vote, held that the Spending Clause, which empowers Congress to spend money for the "general Welfare of the United States," requires congressionally enacted statutes to provide "clear notice to the States of their liabilities should they decide to accept federal funding under those statutes" and that the NCLB Act "fails to provide clear notice as to who bears the additional costs of compliance." Because the court found the statute to be ambiguous in this regard, it ruled that the plaintiffs had established a claim upon which relief could be granted and therefore reversed the district court's decision and remanded the case to the district court for further proceedings consistent with the Sixth Circuit's opinion. In reaching its decision, the two-justice majority emphasized its view that the Spending Clause requires "clear notice" of a state's financial obligations. Under the clause, Congress has frequently promoted its policy goals by conditioning the receipt of federal funds on state compliance with certain requirements. Indeed, the Supreme Court "has repeatedly upheld against constitutional challenge the use of this technique to induce governments and private parties to cooperate voluntarily with federal policy." Although the Court has articulated several standards that purport to limit Congress's discretion to place conditions on federal grants under the spending clause, these standards generally have had little limiting effect: First, the conditions, like the spending itself, must advance the general welfare, but the determination of what constitutes the general welfare rests largely if not wholly with Congress. Second, because a grant is 'much in the nature of a contract' offer that the states may accept or reject, Congress must set out the conditions unambiguously, so that the states may make an informed decision. Third, the Court continues to state that the conditions must be related to the federal interest for which the funds are expended, but it has never found a spending condition deficient under this part of the test. Fourth, the power to condition funds may not be used to induce the states to engage in activities that would themselves be unconstitutional. Fifth, the Court has suggested that in some circumstances the financial inducement offered by Congress might be so coercive as to pass the point at which 'pressure turns into compulsion,' but again the Court has never found a congressional condition to be coercive in this sense. Relying on the standard that spending conditions be set forth "unambiguously," the Sixth Circuit cited two Supreme Court precedents: Pennhurst State School & Hospital v. Halderman and Arlington Central School District Board of Education v. Murphy . The Pennhurst decision involved the Developmentally Disabled Assistance and Bill of Rights Act of 1975, which contained a "bill of rights" provision stating that mentally disabled individuals "have a right to appropriate treatment, services, and habilitation for such disabilities." Unlike other requirements of the act, the bill of rights provision appeared to represent a general statement of federal policy and was not conditioned on the receipt of federal funding. As a result, the Court held that the provision did not create enforceable obligations on the state, in part because Congress had failed to provide clear notice to states that accepting federal funds would require compliance with the bill of rights provision. Meanwhile, the Arlington case involved the Individuals with Disabilities in Education Act, which authorizes a court to award "reasonable attorneys' fees" to plaintiffs who prevail in lawsuits brought under the act. Denying the plaintiffs' request for reimbursement of fees paid to a non-attorney expert, the Court held that the statute did not provide states with clear notice that their acceptance of federal funds obligated them to compensate prevailing parties for such expert fees. Applying these precedents, the Pontiac court sought to determine whether the NCLB Act provided clear notice to the states regarding their funding obligations. According to the court, because the statute "explicitly provides that '[n]othing in this Act shall be construed ... to mandate a State or any subdivision thereof to spend any funds or incur any costs not paid for under this Act,' a state official would not clearly understand that obligation to exist." Although the Sixth Circuit considered alternative interpretations under which the statute could be read to require states to comply with all NCLB requirements regardless of federal funding levels, the court ruled that "the only relevant question here is whether the Act provides clear notice to the States of their obligation." As a result, the court rejected the alternative interpretations advanced in the case, which included (1) the district court's view that the provision prevents officers and employees of the federal government from imposing additional requirements on the states, and (2) the Department of Education's (ED) argument that the provision simply emphasizes that state participation in NCLB is entirely voluntary. Although the Sixth Circuit acknowledged that ED's interpretation of the statute may ultimately be correct, the court held that neither interpretation was sufficiently evident to provide states with clear notice of their obligation to spend additional funds to comply with requirements that are not paid for under the act. As noted above, the Sixth Circuit's Pontiac decision was not unanimous. According to the dissenting judge, § 9527(a) does not render the NCLB Act ambiguous and therefore does not violate the Spending Clause. Specifically, the dissent distinguished the cases cited as precedents and contended that the text, operation, and structure of the act contradict the majority's interpretation. Asserting that state and local school officials "had a crystal clear vision of what Congress was offering them," the dissent characterized the majority opinion as "contrary to the way our nation's education has been operated and funded for centuries" and concluded that "there is no support in the text or context of the NCLB for the proposition that Congress intended such a monumental and unprecedented change in our nation's education funding." In response to the ruling, ED sought review of the Pontiac decision by petitioning the Sixth Circuit for a rehearing en banc . Typically, federal appeals are heard by a panel consisting of three judges, but the term " en banc ," which translates as "full bench," refers to a situation in which a larger number of circuit judges reconsider a decision made by the three-judge panel. Under the Federal Rules of Appellate Procedure, "[a]n en banc hearing or rehearing is not favored and ordinarily will not be ordered unless: (1) en banc consideration is necessary to secure or maintain uniformity of the court's decisions; or (2) the proceeding involves a question of exceptional importance." Although a court of appeals is not obligated to grant a rehearing, ED's petition for en banc review was successful. In a highly fractured decision, the en banc Sixth Circuit ultimately divided evenly, with eight judges voting to affirm the judgment of the district court and eight judges voting to reverse that judgment. In cases in which an evenly divided vote occurs, the usual practice is to affirm the decision of the lower court. As a result, the en banc Sixth Circuit issued an order affirming the district court's decision to dismiss the case. The en banc Pontiac decision contains four separate opinions, two of which concurred in the order affirming the district court's judgment and two of which would have reversed the district court's judgment. In the first concurring opinion, Judge Jeffrey Sutton contended that the school districts had failed to demonstrate that the NCLB Act was ambiguous because the alternative interpretation of the statute that they offered "is implausible and fails to account for, and effectively eviscerates, numerous components of the Act." Specifically, Judge Sutton argued that the school districts' interpretation was inconsistent with provisions relating to accountability, flexibility, waivers, and other requirements because excusing states from compliance with these features of the act would effectively gut the statute. Moreover, Judge Sutton noted, even if the states and school districts were uncertain about their financial obligations when they first participated in the NCLB programs, by the time they filed the lawsuit, they were clearly on notice that ED would require compliance with all of the statutory requirements in exchange for federal funds. In a separate opinion, Judge David McKeague concurred in affirming dismissal for procedural reasons. In the first opinion that would have reversed the district court's judgment, Judge R. Guy Cole argued that the NCLB Act "simply does not include any specific, unambiguous mandate requiring the expenditure of non-NCLB funds," and, as a result, the statute fails to provide clear notice to the states of their financial obligations. Acknowledging that several other interpretations of the statutory language were plausible, Judge Cole emphasized that the relevant inquiry is whether a recipient's obligations are unambiguous, and Congress failed to provide clear notice on that point. In a separate dissent, Judge Julia Smith Gibbons agreed with Judge Sutton that "NCLB does seem to require states to spend their own funds to comply with the statute's requirements," but also agreed with Judge Cole that "the language of § [9527(a)] is not clear." Judge Gibbons would therefore have focused the inquiry on whether § 9527(a) creates so much ambiguity as to cast doubt on the meaning of the rest of the statute and would have remanded the case for further development on this question. Because the school districts do not appear to have appealed to the Supreme Court, the litigation in the Pontiac case has come to an end. The Sixth Circuit's rulings in the Pontiac case have several implications. From a practical perspective, had the original ruling of the three-judge panel not been invalidated by the split vote of the en banc Sixth Circuit, the case might have significantly undermined the operation and effect of the Title I program, as well as other ESEA programs that are subject to the "unfunded mandates" provision in § 9527(a). Although that prospect did not occur, the fact that the en banc judges were evenly divided on the Spending Clause question could potentially create a degree of uncertainty across the landscape of federal funding programs by encouraging legal challenges not only to other federal education programs but also to federal funding programs operated by other federal agencies. In addition to the practical ramifications, there are several important legal implications of the Pontiac decision. First, the decision is effective only in states that fall within the jurisdiction of the Sixth Circuit. Those states are limited to Kentucky, Michigan, Ohio, and Tennessee. Because school districts and educational agencies in other states are not affected by the decision, they may decide to file similar lawsuits in other circuits. Second, if Congress is concerned that the closely divided vote of the en banc Sixth Circuit could encourage future challenges to NCLB requirements, then Congress may wish to clarify its views statutorily. For example, Congress could choose to amend the NCLB Act to clarify that states that accept NCLB funds are obligated to comply with all of the act's requirements, regardless of whether or not the costs of compliance are fully funded by the federal government.

In 2008, a panel of the Court of Appeals for the Sixth Circuit issued a decision in School District of the City of Pontiac v. Secretary of the United States Department of Education. In its decision, the court held that the No Child Left Behind (NCLB) Act failed to provide the required "clear notice" to states and school districts regarding the requirements they must fulfill as a condition of receiving federal funding. The case was subsequently reheard, but the en banc Sixth Circuit divided evenly, meaning that the judgment of the district court to dismiss the case was affirmed. This report discusses some of the practical and legal implications of the Sixth Circuit decisions.

The Fair Labor Standards Act (FLSA), enacted in 1938, is the federal legislation that establishes the general minimum wage that must be paid to all covered workers. A full discussion of the coverage of the minimum wage is beyond the scope of this report, which provides only a broad overview of the topic. In general, th e FLSA mandates broad general minimum wage coverage. It also specifies certain categories of workers who are not covered by FLSA wage standards, such as workers with disabilities or certain youth workers. The act was enacted because its provisions were meant to both protect workers and stimulate the economy. The FLSA also created the Wage and Hour Division (WHD), within the Department of Labor (DOL), to administer and enforce the act. In 1938, the FLSA established a minimum wage of $0.25 per hour. The minimum wage provisions of the FLSA have been amended numerous times since then, typically for the purpose of expanding coverage or raising the wage rate. Since its establishment, the minimum wage rate has been raised 22 separate times. The most recent change was enacted in 2007 ( P.L. 110-28 ), which increased the minimum wage from $5.15 per hour to its current rate of $7.25 per hour in three steps. For employees working in states with a minimum wage different from that of the federal minimum wage, the employee is entitled to the higher wage of the two. The FLSA extends minimum wage coverage to individuals under two types of coverage—"enterprise coverage" and "individual coverage." An individual is covered if they meet the criteria for either category. Around 130 million workers, or 84% of the labor force, are covered by the FLSA. The first category of coverage is at the business or enterprise level. To be covered, an enterprise must have at least two employees and must have annual sales or "business done" of at least $500,000. Annual sales or business done includes all business activities that can be measured in dollars. Thus, for example, retailers are covered by the FLSA if their annual sales are at least $500,000. In non-sales cases, such as enterprises engaged in leasing property, gross amounts paid by tenants for property rental will be considered "business done" for purposes of determining enterprise coverage. In addition, regardless of the dollar volume of business, the FLSA applies to hospitals or other institutions primarily providing medical or nursing care for residents; schools (preschool through institutions of higher education); and federal, state, and local governments. The second category of coverage is at the individual level. Although an enterprise may not be subject to minimum wage requirements if it has less than $500,000 in annual sales or business done, employees of the enterprise may be covered if they are individually engaged in interstate commerce or in the production of goods for interstate commerce. The definition of interstate commerce is fairly broad. To be engaged in "interstate commerce," employees must produce goods (or have indirect input to the production of those goods) that will be shipped out of the state of production, travel to other states for work, make phone calls or send emails to persons in other states, handle records that are involved in interstate transactions, or provide services to buildings (e.g., janitorial work) in which goods are produced for shipment outside of the state. The FLSA covers most, but not all, private and public sector employees. Certain employers and employees are exempt from all or parts of the FLSA minimum wage provisions, either through the individual or enterprise coverage or through specific exemptions included in the act. In addition, the FLSA provides for the payment of subminimum wages (i.e., less than the statutory rate of $7.25 per hour) for certain classes of workers. The FLSA statutorily exempts various workers from FLSA minimum wage coverage. Some of the exemptions are for a class of workers (e.g., executive, administrative, and professional employees), while others are more narrowly targeted to workers performing specific tasks (e.g., workers employed on a casual basis to provide babysitting services). The list below is not exhaustive but is intended to provide examples of workers who are not covered by the minimum wage requirements of the FLSA: bona fide executive, administrative, and professional employees; individuals employed by certain establishments operating only part of the year (e.g., seasonal amusement parks, organized summer camps); individuals who are elected to state or local government offices and members of their staffs, policymaking appointees of elected officeholders of state or local governments, and employees of legislative bodies of state or local governments; employees who are immediate family members of an employer engaged in agriculture; individuals who volunteer their services to a private, nonprofit food bank and who receive groceries from the food bank; agricultural workers meeting certain hours and job duties requirements; individuals employed in the publication of small circulation newspapers; domestic service workers employed on a casual basis to provide babysitting; individuals employed to deliver newspapers; and certain employees in computer-related occupations. The FLSA also allows the payment of subminimum wages for certain classes of workers, including the following: Youth. Employers may pay a minimum wage of $4.25 per hour to individuals under the age of 20 for the first 90 days of employment. Learners. Employers may apply for special certificates from the Wage and Hour Division of DOL that allow them to pay students who are receiving instruction in an accredited school and are employed part-time as part of a vocational training program a wage at least 75% of the federal minimum wage ($5.44 at the current minimum wage). Full-Time Students. Employers may apply for special certificates from the Wage and Hour Division of DOL that allow them to pay full-time students who are employed in retail or service establishments, an agricultural occupation, or an institution of higher education a wage at least 85% of the federal minimum wage ($6.16 at the current minimum wage). Individuals with Disabilities. Employers may apply for special certificates from the Wage and Hour Division of DOL that allow them to pay wages lower than the otherwise applicable federal minimum to persons "whose earning or productive capacity is impaired by age, physical or mental deficiency, or injury." As elaborated in regulations, disabilities that may affect productive capacity include, but are not limited to, blindness, mental illness, mental retardation, cerebral palsy, alcoholism, and drug addiction. There is no statutory minimum wage required under this provision of the FLSA, but pay is to be broadly commensurate with pay to comparable non-disabled workers and related to the individual's productivity. Tipped Workers. Under Section 203(m) of the FLSA, a "tipped employee"—a worker who "customarily and regularly receives more than $30 a month in tips"—may have his or her cash wage from an employer reduced to $2.13 per hour, as long as the combination of tips and cash wage from the employer equals the federal minimum wage. An employer may count against his or her liability for the required payment of the full federal minimum wage the amount an employee earns in tips. The value of tips that an employer may count against their payment of the full minimum wage is known as the "tip credit." Under the current federal minimum wage and the current required minimum employer cash wage, the maximum tip credit is $5.12 per hour (i.e., $7.25 minus $2.13). Thus, all workers covered under the tip credit provision of the FLSA are guaranteed the federal minimum wage. The most recent data available (2016) indicate that there are approximately 2.2 million workers, or 2.7% of all hourly paid workers, whose wages are at or below the federal minimum wage of $7.25 per hour. Of these 2.2 million workers, approximately 700,000 earn the federal minimum wage of $7.25 per hour, and the other 1.5 million earn below the federal minimum wage. As the Bureau of Labor Statistics (BLS) notes, the large number of individuals earning less than the statutory minimum wage does not necessarily indicate violations of the FLSA but may reflect exemptions or misreporting. The "typical" minimum wage earner tends to be female, age 20 or older, part-time, and working in a food service occupation. The data in Table 1 below show selected characteristics of the workers earning at or below the federal minimum wage. The data are based on the universe of the estimated 2.2 million workers who earn $7.25 per hour or less. States may also choose to set labor standards that are different from federal statutes. The FLSA establishes that if states enact minimum wage, overtime, or child labor laws more protective of employees than those provided in the FLSA, the state law applies. In the case of minimum wages, this means that if an individual is covered by the FLSA in a state with a higher state minimum wage, the individual is entitled to receive the higher state minimum wage. On the other hand, some states have set minimum wages lower than the FLSA minimum. In those cases, an FLSA-covered worker would receive the FLSA minimum wage and not the lower state minimum wage. As of January 1, 2017, 29 states and the District of Columbia have minimum wage rates above the federal rate of $7.25 per hour. These rates range from $7.50 per hour in New Mexico to $11.00 in Massachusetts and Washington State and $12.50 in Washington, DC. Two states have minimum wage rates below the federal rate and five have no minimum wage requirement. The remaining 14 states have minimum wage rates equal to the federal rate. In the states with no minimum wage requirements or wages lower than the federal minimum wage, only individuals who are not covered by the FLSA are subject to those lower rates. The literature on the effects of the minimum wage is vast and represents one of the more well-studied issues in labor economics. As such, this topic has resulted in hundreds of academic and non-academic publications. It is beyond the scope of this section to summarize or synthesize this literature. Broadly speaking, there is not universal consensus on the causal relationship between changes in minimum wage and other economic outcomes. This section presents a brief summary of the primary arguments that proponents and opponents make regarding minimum wage increases. Proponents of an increase in the minimum wage often assert that raising wages can be a component in reducing poverty for individuals and families and a direct way to increase earnings for lower-income workers. Assuming the minimum wage earner does not suffer a loss of employment, hours, or other wage supplements as a result of the increase, then an increased minimum wage should close the gap between earnings and the poverty line. For example, a single parent with two children who works full-time, year-round at the current minimum wage has earnings of about 78% of the poverty line. An increase in the minimum wage to $9 per hour would raise that family's earnings to about 97% of the poverty line and an increase to $12 per hour would increase family earnings to 129% of the poverty line. Proponents of minimum wage increases also argue that additional income for individuals will result in increased aggregate demand in the economy. Adult minimum wage households have a higher marginal propensity to spend additional income than higher-income households. Therefore, to the extent that minimum wage increases raise the income of adult minimum wage households, a minimum wage increase could have a stimulative effect on the economy. Proponents of an increase in the minimum wage argue that it could help reduce earnings inequality by setting a higher floor at the lower end of the wage scale. At the level of an individual business, wage compression might occur if the minimum wage increases at the low end of the pay scale were offset by freezes or reductions in pay at higher levels of pay. That is, the spread between the lowest earners and the highest earners at a business might narrow if the business adjusted to higher pay for minimum wage earners by keeping flat or reducing pay for higher earners. Economy-wide, the size of the gap between low-wage earners and middle and high earners might decrease depending on how widely wage compression was used as a channel of adjustment to minimum wage increases. A higher wage may lead workers to choose to stay in their jobs longer than they otherwise would have under a lower wage. Because high turnover is costly to businesses, proponents of minimum wage increases argue that an increase in the minimum wage may be offset by lower turnover costs. Much of the popular discussion about the effects of a minimum wage increase focuses only on one channel of adjustment—employment. In particular, opponents of a minimum wage or of minimum wage increases assert that increases in the minimum wage will result in increased unemployment, either broadly or for particular subpopulations of the labor market (e.g., youth, less skilled or experienced workers), or a reduction in hours worked. In a standard competitive model of the labor market, the introduction of or increase in the minimum wage (a price increase) results in employment losses (demand decrease). Because the minimum wage is not targeted to workers in low-income households, it is possible that the minimum wage does not reduce poverty to the extent a targeted policy might (e.g., tax credit). The minimum wage is a relatively blunt anti-poverty policy as it may raise wages for people not in poverty such as suburban teenagers who live in a middle- or high-income household. Another way minimum wage increases might be absorbed is through changes in prices. Specifically, employers facing a higher mandated minimum wage might choose, if possible, to pass on the extra costs of labor to the consumers through higher prices. If minimum wage increases result in an increase in the aggregate price level, then the inflationary effects would erode some of the purchasing power of both those receiving raises and everyone else in the economy. A decrease in profits could be another means of adjustment to an increase in the minimum wage. The ability of any given business to lower profits to pay for mandated increases depends on the profit margins of that firm.

The Fair Labor Standards Act (FLSA), enacted in 1938, is the federal legislation that establishes the minimum hourly wage that must be paid to all covered workers. The minimum wage provisions of the FLSA have been amended numerous times since 1938, typically for the purpose of expanding coverage or raising the wage rate. Since its establishment, the minimum wage rate has been raised 22 separate times. The most recent change was enacted in 2007 (P.L. 110-28), which increased the minimum wage to its current level of $7.25 per hour. In addition to setting the federal minimum wage rate, the FLSA provides for several exemptions and subminimum wage categories for certain classes of workers and types of work. Even with these exemptions, the FLSA minimum wage provisions still cover the vast majority of the workforce. Despite this broad coverage, however, the minimum wage directly affects a relatively small portion of the workforce. Currently, there are approximately 2.2 million workers, or 2.7% of all hourly paid workers, whose wages are at or below the federal minimum wage of $7.25 per hour. Most minimum wage workers are female, are age 20 or older, work part time, and are in food service occupations. Proponents of increasing the federal minimum wage argue that it may increase earnings for lower income workers, lead to reduced turnover, and increase aggregate demand by providing greater purchasing power for workers receiving a pay increase. Opponents of increasing the federal minimum wage argue that it may result in reduced employment or reduced hours, lead to a general price increase, and reduce profits of firms paying a higher minimum wage.

Under U.S. immigration law, foreign nationals are legally admitted into the United States as immigrants to live permanently or as nonimmigrants to stay on a temporary basis. The terms "immigrant" and "nonimmigrant" are not used in the Internal Revenue Code (IRC). Instead, a foreign national, whether in the United States as an immigrant, nonimmigrant or unauthorized (illegal) alien, is classified as a resident or nonresident alien for federal tax purposes. For federal tax purposes, alien individuals are classified as resident or nonresident aliens. The classification has important consequences for determining whether income is subject to U.S. taxation, what is the appropriate tax rate, and whether an individual is covered by a tax treaty. In general, an individual is a nonresident alien unless he or she meets the qualifications under either residency test: Green card test: the individual is a lawful permanent resident of the United States at any time during the current year, or Substantial presence test: the individual is present in the United States for at least 31 days during the current year and at least 183 days during the current year and previous two years. For computing the 183 days, a formula is used that counts all the qualifying days in the current year, 1/3 of the qualifying days in the immediate preceding year, and 1/6 of the qualifying days in the second preceding year. There are several situations in which an individual may be classified as a nonresident alien even though he or she meets the substantial presence test. For example, an individual will be treated as a nonresident alien if he or she has a closer connection to a foreign country than to the United States, maintains a tax home in the foreign country, and is in the United States for fewer than 183 days during the year. Another example is that an individual in the United States under an F-, J-, M-, or Q-visa may be treated as a nonresident alien if he or she has substantially complied with visa requirements. Other individuals that may be treated as nonresident aliens even if they meet the substantial presence test include employees of foreign governments and international organizations, regular commuters from Canada or Mexico, aliens who are unable to the leave the United States because of a medical condition, foreign vessel crew members, aliens in transit through the United States, and athletes participating in charitable sporting events. A residency definition in an income tax treaty will override these residency rules. If an individual is defined as a resident of a foreign country under a treaty, then he or she is a nonresident alien for purposes of determining his or her U.S. tax liability regardless of whether the "green card" or "substantial presence" test is met. The Internal Revenue Code (IRC) does not have a special classification for individuals who are in the United States without authorization (commonly referred to as "illegal aliens"). Instead, the Code treats these individuals in the same manner as other foreign nationals—they are subject to federal taxes and classified for tax purposes as either resident or nonresident aliens. An unauthorized individual who has been in the United States long enough to qualify under the "substantial presence" test is classified as a resident alien; otherwise, the individual is classified as a nonresident alien. This classification is for tax purposes only and does not affect the individual's immigration status. While most taxpayers file tax returns using their Social Security number (SSN) as an identifier, individuals who are ineligible to receive an SSN file their returns using an individual taxpayer identification number (ITIN). Thus, unauthorized aliens who file tax returns will generally use an ITIN. One consequence of this is that they will be ineligible to claim the earned income tax credit (EITC) since the IRC requires that taxpayers claiming the EITC provide SSNs for themselves, their spouses (if filing a joint return), and their qualifying children. A similar rule applied to the temporary refundable tax credit ("recovery rebate") provided under the Economic Stimulus Act of 2008. Furthermore, in the 112 th Congress, legislation has been introduced that would impose, with some differences, an SSN requirement for claiming the additional child tax credit, any part of the child tax credit, or any credit or refund (e.g., H.R. 1196 ). Two of these bills— H.R. 3630 and H.R. 5652 —have been passed by the House; however, H.R. 3630 was enacted into law ( P.L. 112-96 ) without the SSN provision. The mechanism of using an SSN requirement for restricting the eligibility of unauthorized aliens to claim tax credits may be imprecise. There remains the possibility that attempts to claim a credit could be made by resident aliens who legally received SSNs but are currently not legally present in the United States, in addition to unauthorized aliens using fraudulent SSNs. At the same time, the SSN requirement may deny the credits to families that do not include any unauthorized aliens but have at least one member without an SSN. For example, after it came to light that overseas military members with foreign spouses would be ineligible for the 2008 recovery rebate, Congress exempted military members from the SSN requirement. Resident aliens are generally subject to the same federal income tax laws as citizens of the United States. Like U.S. citizens, resident aliens are subject to tax on all income earned in the United States and abroad. Resident aliens file a tax return using the Form 1040 series, may claim deductions and credits, and are taxed at the same graduated rates as U.S. citizens. They are also subject to income tax withholding. Nonresident aliens are taxed on income from sources within the United States but generally not on income from foreign sources. Sections 861, 862, 863, 864, and 865 of the Internal Revenue Code define income that is from sources within and outside the United States. Compensation for services performed in the United States is U.S. source income. A nonresident alien's U.S. source income is taxed at different rates depending on whether it is "effectively connected" with a trade or business in the United States. An individual must generally be engaged in a trade or business in the United States to have "effectively connected" income. The term generally includes compensation for the performance of personal services in the United States. Nonresident aliens with F-, J-, M-, or Q-visas are considered to be engaged in a trade or business in the United States. Income that is effectively connected with a trade or business in the United States is generally taxed by the same rules and at the same graduated rates as the income of U.S. citizens and resident aliens. In general, income that is not effectively connected may not be reduced by deductions and is subject to tax at a flat rate of 30%. Nonresident aliens file a return using the Form 1040NR series and are subject to the same collection procedures as U.S. citizens and resident aliens. Furthermore, they are generally subject to withholding on personal service compensation and non-effectively connected income. There are limited circumstances in which a nonresident alien's U.S. source income is not subject to U.S. taxation. For example, some interest income that is not connected with a U.S. trade or business (e.g., portfolio interest) is exempt from U.S. tax. Another example is that compensation for services performed in the United States is not subject to U.S. tax if the services are for a foreign employer or office, the alien is in the United States for not more than 90 days during the tax year, and the compensation does not exceed $3000. A nonresident alien with an F-, J-, or Q-visa is not taxed on compensation received from a foreign employer. Employees of foreign governments and international organizations and crew members of foreign vessels and aircraft may qualify to exempt their compensation from tax. Additionally, income may be exempt from U.S. tax under a treaty (see below). Aliens leaving the United States usually must obtain a certificate of compliance ("sailing permit") from the IRS that shows he or she "has complied with all the obligations imposed upon him by the income tax laws." The IRS may subject aliens who attempt to leave without one to examination at the point of departure and require payment of any taxes whose collection would be jeopardized by the departure. Tax treaties provide benefits to nonresident aliens and, in certain situations, resident aliens. Benefits vary by treaty. Typical provisions include the reduction of the 30% flat rate applied to non-effectively connected U.S. source income and the exemption of gain from the sale of personal property. Treaties often exempt personal service compensation from taxation if a nonresident alien is in the United States for less than a stated period of time (e.g., 90, 180, or 183 days) or the compensation is less than a specified amount (generally between $3,000 and $10,000) and paid by a foreign employer. Treaty provisions may also exempt the compensation of specific groups of employees (e.g., students, teachers, athletes, and employees of foreign governments). The United States has income tax treaties with Armenia, Australia, Austria, Azerbaijan, Bangladesh, Barbados, Belarus, Belgium, Bulgaria, Canada, China, Cyprus, Czech Republic, Denmark, Egypt, Estonia, Finland, France, Georgia, Germany, Greece, Hungary, Iceland, India, Indonesia, Ireland, Israel, Italy, Jamaica, Japan, Kazakhstan, Kyrgyzstan, Latvia, Lithuania, Luxembourg, Malta, Mexico, Moldova, Morocco, the Netherlands, New Zealand, Norway, Pakistan, Philippines, Poland, Portugal, Romania, Russia, Slovak Republic, Slovenia, South Africa, South Korea, Spain, Sri Lanka, Sweden, Switzerland, Tajikistan, Thailand, Trinidad, Tunisia, Turkey, Turkmenistan, Ukraine, the United Kingdom, Uzbekistan, and Venezuela. Resident aliens are subject to Social Security and Medicare taxes on wages (FICA taxes) and on self-employment income (SECA taxes) in the same manner as U.S. citizens. In general, nonresident aliens are subject to FICA taxes on compensation from work within the United States under the rules applicable to U.S. citizens and resident aliens, but are not subject to SECA taxes. A list of exempted services in IRC §3121(b) is generally applicable to all who work in the United States. Examples include services performed by foreign workers temporarily admitted to the United States to perform agricultural labor and services performed by employees of foreign governments and qualifying international organizations. Also exempted are services performed by individuals with F-, J-, M-, or Q-visas that meet the purpose of admittance and services performed in Guam by H-2 visa holders who are residents of the Philippines. The United States has entered into totalization agreements with numerous countries that have social security programs. The intent of these agreements is to provide individuals who work in two countries with the opportunity to qualify for social security benefits in one country and to avoid double coverage and taxation. With respect to the issue of double coverage and taxation, agreements generally provide that individuals are only covered by the social security program (and therefore only subject to the program's taxes) in the country where they are working, although individuals who are covered in their home country and temporarily assigned by their employer to work in the other country are exempt from coverage in that country. A self-employed individual generally is covered and pays social security taxes in the country where he or she resides. The United States has entered into totalization agreements with Australia, Austria, Belgium, Canada, Chile, Czech Republic, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Japan, Luxembourg, the Netherlands, Norway, Poland, Portugal, Spain, South Korea, Sweden, Switzerland, and the United Kingdom. In 2004, the United States signed an agreement with Mexico, which has been controversial. It has not yet been transmitted to Congress. The Consolidated Appropriations Act, 2012 prohibits the Social Security Commissioner or Social Security Administration (SSA) from using any of the funds appropriated by the act to pay compensation to SSA employees to administer Social Security benefit payments under any U.S.-Mexico totalization agreement that would not otherwise be payable. Other legislation has been introduced, the Loophole Elimination and Verification Enforcement Act (or LEAVE Act), that would state it is the sense of the House that the U.S.-Mexico totalization agreement "is inappropriate public policy and should not take effect." Another bill introduced in the 112 th Congress would address a constitutional issue with the existing totalization agreement process. Under current law, once an agreement is transmitted to Congress, it becomes effective at the end of the period during which at least one house has been in session 60 days, unless either house adopts a resolution of disapproval. This is a legislative veto, and the Supreme Court held such vetoes to be unconstitutional. The Social Security Totalization Agreement Reform Act of 2011 (or STAR Act) would, among other things, address the legislative veto problem by implementing a new approval process.

A question that often arises is whether unauthorized aliens and other foreign nationals working in the United States are subject to U.S. taxes. The federal tax consequences for these individuals are dependent on (a) whether an individual is classified as a resident or nonresident alien and (b) whether a tax treaty or totalization agreement exists between the United States and the individual's home country. In general, an individual is a resident alien if he or she is a lawful permanent U.S. resident or is in the United States for a substantial period of time during the current and past two years (the "substantial presence" test). Otherwise, he or she will typically be classified as a nonresident alien. Resident aliens are generally taxed in the same manner as U.S. citizens. Nonresident aliens are subject to different treatment, such as generally being taxed only on income from U.S. sources. Exceptions exist for aliens with specific types of visas or employment. An individual who is in the country unlawfully is, like any other alien, classified as either a resident or nonresident alien. This classification is for tax purposes only, and it does not affect the individual's immigration status. These individuals' eligibility to claim the earned income tax credit is restricted because the tax code requires that taxpayers claiming the credit provide their Social Security number (SSN), as well as those of their spouse and dependents. Unauthorized aliens are ineligible for SSNs, and therefore file their tax returns using an individual taxpayer identification number (ITIN). In the 112th Congress, legislation has been introduced that would, with some differences, impose an SSN requirement for claiming the additional child tax credit (e.g., H.R. 3630, H.R. 5652, H.R. 3275, and H.R. 1956), for claiming any part of the child tax credit (H.R. 3444 and S. 577), or for claiming any credit or refund (e.g., H.R. 1196). Two of these bills—H.R. 3630 and H.R. 5652—have been passed by the House; however, H.R. 3630 was enacted into law (P.L. 112-96) without the provision. Finally, the provisions of an income tax treaty or totalization agreement may reduce or eliminate taxes owed to the United States. An income tax treaty is a bilateral agreement between the United States and another country that addresses the income tax treatment of each country's residents while in the other country, primarily with the intent of reducing the incidence of double taxation. Totalization agreements are bilateral treaties that address social security taxes. In 2004, the United States signed a totalization agreement with Mexico, but it has not yet been transmitted to Congress for review. In the 112th Congress, the Consolidated Appropriations Act, 2012 prohibits the Social Security Commissioner or Social Security Administration (SSA) from using any of the funds appropriated by the act to pay compensation to SSA employees to administer Social Security benefit payments under any U.S.-Mexico totalization agreement that would not otherwise be payable. Other legislation has been introduced that would state it is the sense of the House that the U.S.-Mexico totalization agreement "is inappropriate public policy and should not take effect" (H.R. 1196), or address a constitutional issue with the manner in which totalization agreements are disapproved by Congress (S. 181).

U.S. greenhouse gas (GHG) emission levels remain a topic of interest among policy makers and stakeholders. On June 25, 2013, President Obama affirmed his commitment to reduce U.S. GHG emissions by 17% below 2005 levels by 2020 if all other major economies agreed to limit their emissions as well. In addition, during a November 2014 trip to China, President Obama and President Xi of China made a bilateral announcement concerning GHG emissions. President Obama announced a new policy target to reduce U.S. net GHG emissions by 26%-28% by 2025. President Xi agreed to "peak" Chinese carbon dioxide (CO 2 ) emissions around 2030, perhaps earlier, and to increase the non-fossil share of China's energy to around 20% by 2030 compared to 2005 levels. A question for policy makers is whether U.S. GHG emissions will remain at current levels, decrease to meet the President's 2020 and 2025 goals, or increase to former (or even higher) levels. Multiple factors, including socioeconomics, technology, and climate policies, may impact GHG emission levels. The human-related GHG emission and related data in this report are from publicly available sources, particularly reports and tables produced regularly by the Environmental Protection Agency (EPA) and the Energy Information Administration (EIA). This first section of this report provides current levels and recent trends in U.S. GHG emissions. The second section takes a closer look at some of the key factors that influence emission levels. The third section discusses the challenges in making GHG emission projections by comparing observed emissions with preobserved emission estimates. As Figure 1 illustrates, U.S. GHG emissions increased during most of the years between 1990 and 2007, and then decreased substantially in 2008 and 2009. Although emissions increased in 2010, levels decreased again in 2011 and 2012, eventually reaching levels comparable to those in 1995. In terms of the President's 2020 emissions target (17% below 2005 levels), U.S. GHG emissions in 2012—the most recent year with available GHG emission data—were approximately 10% below 2005 levels. GHG emissions are generated throughout the United States by millions of discrete sources: smokestacks, vehicle exhaust pipes, households, commercial buildings, livestock, etc. Figure 2 illustrates the breakdown of U.S. GHG emissions by gas and type of source. The figure indicates that CO 2 from the combustion of fossil fuels—petroleum, coal, and natural gas—accounted for 78% of total U.S. GHG emissions in 2012. The next section examines CO 2 emissions from fossil fuel combustion. In the context of GHG emission reduction programs and legislative proposals, CO 2 emissions from the combustion of fossil fuels have received the most attention. CO 2 emissions are fairly easy to verify from large stationary sources, like power plants. For almost 20 years, measurement devices have been installed in smokestacks of large facilities, reporting electronic information to EPA and the appropriate state. For smaller sources, CO 2 emissions are a relatively straightforward and accurate calculation based on the carbon content of fossil fuels consumed. In addition, according to EPA, "changes in emissions from fossil fuel combustion have been the dominant factor affecting U.S. emission trends." Figure 3 illustrates the CO 2 emission contributions by sector from the combustion of fossil fuels. The largest contribution (40%) is from electricity generation. The generated electricity is distributed almost equally to the residential, industrial, and commercial sectors. Multiple variables impact U.S. GHG emission levels. One approach often taken in climate change analysis is to examine several broad energy-related factors that influence GHG emission levels, including population, income—measured here as per capita gross domestic product (GDP), energy intensity—measured here as energy use per gross domestic product, and carbon intensity—measured here as CO 2 emissions per energy use. As illustrated in the equation below, GHG emission levels can be approximated by multiplying together these four factors. Although decreases in population and/or per capita income would contribute to lowering U.S. GHG emissions, policies that would seek to directly limit these emissions drivers are essentially outside the bounds of U.S. public policy. Thus the most relevant factors in terms of climate change policy are energy intensity and carbon intensity, which are discussed below. Energy intensity is the amount of energy consumed—often measured in metric tons of oil equivalent (toe) or British thermal units (Btus)—per a level of economic output such as GDP. Figure 4 illustrates the U.S. total energy consumption and GDP between 1990 and 2013. The figure indicates that energy use increased from 1990 to 2000 at an annual average rate of 1.6%, and then remained relatively constant (excepting some annual fluctuations) through 2013. In contrast, U.S. GDP (in 2009$) has increased at an average annual rate of approximately 2.5% from 1990 through 2013. Thus, U.S. energy intensity declined between 1990 and 2013. Figure 5 compares the energy intensities of the United States, the European Union (28 nations), and China between 1990 and 2011. As the figure illustrates, U.S. energy intensity has been declining by about 2% each year for two decades: the U.S. energy intensity in 2011 was 31% lower than it was in 1990. However, the energy intensity in the United States was 42% higher in 2011 than in the European Union. The degree to which the U.S. economy is composed of industries with relatively high energy intensities likely plays a role in determining the energy intensity of United States. Figure 6 indicates that the percentage contribution to the U.S. GDP from selected energy-intensive industries decreased from 4.2% in 1998 to 3.2% in 2011. Figure 6 includes 44 industries in the six-digit North American Industry Classification System (NAICS). These industries have an energy intensity of at least 5%, measured by dividing energy expenditures by the value of an industry's shipments. In this report, carbon intensity measures the amount of CO 2 emissions generated during energy use, which includes fuel combustion for electricity generation and transportation purposes. Energy sources (e.g., coal, natural gas, petroleum, nuclear, and renewables) vary dramatically in the amount of carbon released per unit of energy supplied. As indicated in Table 1 , coal generates approximately 80% more CO 2 emissions per unit of energy than natural gas, and approximately 28% more emissions per unit of energy than crude oil. Moreover, other energy sources, such as nuclear or specific renewable sources, do not directly generate any CO 2 emissions. Figure 7 illustrates the U.S. carbon content of energy use—CO 2 emissions per Btu—between 1990 and 2013. This includes energy used (i.e., consumed) in the electricity, industrial, transportation, commercial, and residential sectors. The figure indicates that this measure remained relatively constant from 1990 to 2005, when it began to decline. By 2013, the carbon content of energy use was approximately 8% lower than it was in 2005. This decline is largely related to the recent change in the portfolio of fuels consumed for energy purposes. Figure 8 compares the consumption percentage of different energy sources in the United States. The figure indicates that the trajectories of coal and natural gas have diverged in recent years. Since 2008, coal's percentage contribution has decreased from 23% to 19%. In contrast, natural gas's percentage contribution has increased from 24% to 27% during that time frame. In addition, renewable energy's share of total energy consumption has increased substantially over the past decade. The recent changes in energy consumption are partially explained by changes in the energy sources used to generate electricity, because the electric power sector accounts for approximately 40% of total energy use. As an illustration of recent changes in the electricity sector, Figure 9 compares electricity generation by energy source between 2004 and 2013. The figure indicates a substantial decrease in coal use with a simultaneous increase in natural gas. Moreover, the percentage share of renewable sources increased from 2% to 6%, and petroleum decreased from 3% to less than 1%. Accurately forecasting future GHG emission levels is a complex and challenging, if not impossible, endeavor. Consequently, analysts often provide a range of emissions based on different scenarios or assumptions. As discussed above, several broad energy-related factors influence emission levels. In addition, other variables have impacts in ways that cannot be accurately predicted. Such variables may include technological developments, energy price fluctuations, availability of less carbon-intensive energy sources (e.g., hydroelectric, other renewables, and nuclear power), seasonal weather and temperature patterns, and policy changes in the United States and abroad. EIA provides annual forecasts of CO 2 emissions in its Annual Energy Outlook (AEO) publications. Regarding its various estimates, EIA states the following: The projections in the AEO are not statements of what will happen but of what might happen, given assumptions and methodologies. The AEO Reference case projection assumes trends that are consistent with historical and current market behavior, technological and demographic changes, and current laws and regulations. The potential impacts of pending or proposed legislation, regulations, and standards are not reflected in the Reference case projections. Figure 10 compares actual CO 2 emissions between 1990 and 2012 with selected EIA emission projections made in past years. In general, actual emissions have remained well below projections, particularly the projections made in 2008 or earlier. For example, the AEO from 2000 projected CO 2 emissions would be almost 6.7 billion metric tons in 2012, about 20% higher than has been observed. By comparison, the more recent projections (AEO 2012 and 2014) indicate that CO 2 emissions will remain relatively flat over the next decade.

On June 25, 2013, President Obama affirmed his commitment to reduce U.S. greenhouse gas (GHG) emissions by 17% below 2005 levels by 2020 if all other major economies agreed to limit their emissions as well. In addition, during a November 2014 trip to China, President Obama announced a new policy target to reduce U.S. net GHG emissions by 26%-28% by 2025. Whether these objectives will be met is uncertain, but emission levels and recent trends remain a topic of interest among policy makers. U.S. GHG emissions increased during most of the years between 1990 and 2007, and then decreased substantially in 2008 and 2009. Although emissions increased in 2010, levels decreased again in 2011 and 2012, eventually reaching levels comparable to those from 1995. In terms of the President's 2020 emissions target, in 2012, U.S. GHG emissions were approximately 10% below 2005 levels—more than halfway toward the 2020 target. In the United States, GHG emissions are generated by millions of discrete sources, including smokestacks, vehicle exhaust pipes, commercial buildings, and households. However, carbon dioxide (CO2) emissions from the combustion of fossil fuels—petroleum, coal, and natural gas—have received the most attention because they account for the vast majority of human-related GHG emissions: 78% of total U.S. GHG emissions in 2012. In addition, (1) CO2 emissions from large stationary sources are easy to measure and have been tracked for almost 20 years, and (2) CO2 emissions from smaller sources can be estimated through relatively straightforward calculations. In 2012, the percentage contributions of CO2 emissions by sector were as follows: 40% from electricity, 35% from transportation, 15% from industrial, 6% from commercial, and 4% from residential. Although multiple factors have some level of influence on U.S. GHG emission levels, it may be instructive to examine several broad energy-related factors including population, income, energy intensity (energy use per economic output such as gross domestic product, or GDP) and carbon intensity (CO2 emissions per unit of energy use). Although decreases in population and/or income would contribute to reducing U.S. GHG emissions, policies that would seek to directly limit these emissions drivers are essentially outside the bounds of U.S. public policy. Therefore, this report focuses on the impacts of energy intensity and carbon intensity on GHG emission levels. As energy use has grown at a slower rate than the economy, U.S. energy intensity declined by about 2% each year for more than two decades. Between 1990 and 2013, U.S. GDP (in 2009$) increased at an average annual rate of approximately 2.5%. Energy use, in contrast, increased from 1990 to 2000 at an annual average rate of 1.6%, but then remained relatively constant (excepting some annual fluctuations) through 2013. The U.S. carbon content of energy use remained relatively constant from 1990 to 2005, but by 2013, it was approximately 8% lower than in 2005. In this report, carbon intensity measures the amount of CO2 emissions generated per unit of energy used. Energy sources—coal, natural gas, petroleum, nuclear, renewables—vary dramatically in the amount of carbon released per unit of energy supplied. For example, coal combustion accounts for almost twice the carbon content per unit of energy than natural gas, and some energy sources, when consumed, do not directly generate any emissions. This recent decrease in the carbon content of energy use is partially explained by changes in the energy sources used to generate electricity, because the electric power sector accounts for approximately 40% of total energy use. For example, between 2004 and 2013, the percentage of electricity from coal generation decreased from 50% to 39%, while the percentage of electricity generated using natural gas increased from 18% to 28%. In addition, renewable energy use increased by 100%, and the use of petroleum to generate electricity decreased by approximately 100%.

Poland has had an eventful political evolution in recent years. Since 2001, five prime ministers have held office. Although the last government, led by the Democratic Left Alliance (SLD), steered the nation into the EU and nurtured a strong, export-based economy, its reputation was seriously damaged by a series of high-profile scandals. In Poland's last parliamentary elections, held in September 2005, voters registered their disappointment and the SLD suffered defeat—maintaining Poland's post-1989 track record of turning out the ruling party. Although polls during the campaign suggested that the centrist, pro-market Civic Platform (PO) would take the most votes, the nationalist conservative Law and Justice party (PiS) wound up winning a plurality seats in the lower house of parliament, the Sejm . During the campaign, PiS emphasized family values and social justice and pledged to assert Poland's interests internationally. PiS portrayed itself as the agent for change that would bring about a new era in Poland, and spoke of creating a "Fourth Republic." True to its name, Law and Justice has placed priority on improving the judicial system and aggressively rooting out corruption. Although conservative in outlook on most social issues, PiS favors social spending and distrusts privatization—and especially foreign ownership—of certain "strategic" state assets. PiS was founded in 2001 by identical twin brothers, Jaroslaw and Lech Kaczynski. Former Warsaw mayor Lech became the successful PiS presidential candidate, defeating PO's Donald Tusk in an October 2005 runoff vote. The victory surprised many, as Tusk had held a strong lead in the polls. The two men had served together in the Solidarity party in the 1990s, but their brands of conservatism differed—a reflection of their parties' orientations. Kaczynski, for example, espoused economic nationalism and active government intervention, while Tusk believed that further market-based reforms would ensure prosperity. Analysts attribute the election results to voter approval of Kaczynski's strong anti-corruption policies; his support came mainly from older and less affluent Poles in rural areas, while Tusk appealed to younger and urban voters. Jaroslaw initially declared that he would not serve as prime minster; analysts argue that he did so before the presidential elections in the hopes of helping Lech by defusing potential voter unease over having two siblings run the country. The premiership went instead to Kazimierz Marcinkiewicz. In mid-July 2006, however, Marcinkiewicz, the country's most-trusted office-holder, stepped down; some observers believe that the Kaczynskis, concerned over Marcinkiewicz' growing popularity and independence, may have engineered his departure. In addition, Marcinkiewicz was said to be frustrated that he had not been consulted over recent cabinet changes. After Lech named his twin brother to replace Marcinkiewicz, an opinion poll showed that only 21% of the public approved the appointment of Jaroslaw, whom many viewed as "divisive." After the elections, PiS and PO were expected to form a coalition, but talks soon collapsed. PiS initially decided to rule from a minority position, with informal support from two smaller parties—the rural-based Self Defense (SO) party led by populist Andrzej Lepper, and the League of Polish Families (LPR), an ultra-conservative party aligned with the Catholic church. In April 2006 the three parties entered into a formal coalition with a majority in parliament. The formation of the coalition has had both domestic and continental repercussions: Poland's Foreign Minister tendered his resignation in protest, and in June, the European Parliament stated that the leaders of LPR "incite people to hatred and violence." In September 2006, amid budget disagreements, SO left the coalition, but rejoined the government a few weeks later. Over the following months, additional high level government officials either resigned or were sacked, and the Kaczynskis reportedly consolidated their power by appointing loyalists to those posts. On July 9, 2007, Lepper was dismissed from his cabinet posts on corruption charges, but SO remained in the coalition for the time being. Out of concern that they would either lose seats or be unable to muster enough votes to pass the 5% minimum threshold necessary to stay in parliament, SO and LPR merged to form the League and Self Defense Party (LiS). The new party then proposed conditions for remaining in the coalition. On July 30, PiS rejected those terms. Observers believe the dispute will be resolved after August 22, when parliament reconvenes after recess. Early elections are possible. Poland's economy is among the most successful transition economies in east central Europe; all of the post-1989 governments have generally supported free-market reforms. Today the private sector accounts for over two-thirds of economic activity. In recent years, Poland has enjoyed rapid economic development; GDP grew by 3.4% in 2005 and 5.3% in 2006, and is predicted to rise by 6.3% in 2007. Unemployment, though still high at 12.4% in July 2007, is at its lowest level in several years. To keep a lid on the federal budget deficit, PiS has been struggling with its coalition partners, who have sought additional funding for social programs. In the area of monetary policy, some analysts are concerned over PiS's apparent willingness to reduce the independence of the country's central bank. Leszek Balcerowicz, the respected former governor of the bank, criticized the desire of some in government to push for a reduction in interest rates; under his leadership, the bank geared its policies toward meeting the criteria for joining the euro, whereas PiS and its allies reportedly wished to stimulate demand and growth through rate cuts. Unlike several new EU members, the Polish government has not yet set a firm target date for adopting the euro; Prime Minister Kaczynski stated that "it is very risky and that is why I think we can only consider it when the economy has significantly strengthened." Warsaw reportedly asked Brussels for additional time to bring down its deficit so that it may continue to receive EU assistance and eventually be able to qualify for euro adoption. In January 2007, Balcerowicz' term expired, and parliament approved Slawomir Skrzypek, a Kaczynski ally with little experience in monetary policy, as the new central banker. In July 2007, he announced the creation of an office to study the costs and benefits of joining the eurozone; in the meantime, Mr. Skrzypek said, the central bank would remain neutral on the issue. Despite its center-right label, PiS has been characterized as having a somewhat statist approach toward governance, particularly in its economic policies. For example, it espouses that "national champions" in certain sectors be identified and nurtured. In addition, some have speculated that PiS may seek to overturn earlier, SLD-approved reforms that sought to introduce greater flexibility in the labor code. Also, PiS reportedly would like to introduce vertical integration of the parts of the energy sector that are still owned by the state. To reduce dependence upon Russia, which supplies a large part of Poland's gas and oil, the government has instituted talks with Norway over laying a pipeline and constructing LNG (liquefied natural gas) terminals on the Baltic coast. In addition, Poland and the Baltic states are exploring a joint nuclear power project. Over the past two years, Poland has contributed a significant number of troops to the U.S.-led operation in Iraq. Observers note that the deployment is providing the Polish military with invaluable experience, not the least of which includes commanding a multinational division. However, Poland's presence in Iraq remains unpopular at home. The government has said that Poland will maintain its 900 troops there until the end of 2007. Poland also has sharply stepped up the size of its contingent of soldiers in Afghanistan, to 1,000. In addition, Warsaw contributed 260 troops to the U.N. peacekeeping mission in Lebanon. Poland has been a member of the European Union (EU) since May 2004 and has already experienced economic benefits from membership, particularly in the agricultural sector. Nevertheless, the Polish government was not reluctant to assert itself in a number of issue areas before joining the EU, and has been even less hesitant to do so now that it is a member. The new Polish government has sometimes been skeptical of the EU. It favors the eventual widening (to include Ukraine and Belarus) but not necessarily the deepening of the Union. At an EU meeting in Berlin in early 2006, Poland declined to support a plan to craft an energy agreement with Russia, which in January 2005 had temporarily halted gas deliveries to Ukraine and disrupted deliveries to Europe. Poland proposed instead the creation of an energy security treaty among EU and NATO countries, which would not include Russia, but would acknowledge that Russia would remain a major supplier. Some European analysts argued that Russia should be excluded, as it supplies such a large part of Europe's energy. However, citing past instances of energy cutoffs, Poland contended that Russia is unreliable. In November 2006, frustrated over Russia's energy policies and its year-long Russian ban on Polish agricultural products, Warsaw vetoed talks over the renewal of an EU-Russia partnership agreement. In 2007, attention focused on Poland's efforts to influence the EU voting system, which was under revision as part of a new treaty for the Union. Warsaw maintained that the proposed formula was skewed toward the largest countries, and proposed instead that voting strength be based upon the square root of each country's population; only the Czech Republic supported Poland's solution, which the Kaczynskis claimed was "worth dying for." During the negotiations, Prime Minister Kaczynski also argued that Poland's population would have been 66 million rather than the current 38 million had it not been for Germany's World War II invasion and occupation. A compromise—a delay of the introduction of the new formula—was reached eventually. Warsaw later stated that it would seek to revisit the voting issue during Portugal's EU presidency, but then backed away from that demand. Poland's behavior during the negotiations came in for strong criticism. According to the Financial Times , Jean-Claude Junker, Prime Minister of Luxembourg, "said Poland's stance at last week's summit was 'very near to having been unacceptable.'" Under the new government Poland's relations with Germany and Russia have been strained at times. Many Polish officials were incensed over the Russo-German agreement to construct a natural gas pipeline through the Baltic Sea, rather than overland, through the Baltics and Poland. During the 2005 presidential campaign, Lech Kaczynski said that, if elected, he would maintain a "firm but friendly" relationship with Russia. He also reminded Poles of the devastation wrought by Germany during World War II, but denied that raising this issue was an attempt to influence the election outcome. In June 2006, the German newspaper Tageszeitung ran a satire on the Kaczynski brothers. The Polish government demanded that the German government take action against the newspaper and apologize for the article, but Berlin, citing freedom of the press, responded that intervention would be illegal and an apology inappropriate. The article is believed to have prompted Lech to cancel his attendance of a summit meeting with France and Germany. Poland and the United States have historically close relations. Since 9/11, Warsaw has been a reliable supporter and ally in the global war on terrorism and, as noted earlier, has contributed troops to the U.S.-led coalitions in Afghanistan and in Iraq. Poland also has cooperated with the United States on "such issues as democratization, nuclear proliferation, human rights, regional cooperation ... and UN reform." During Prime Minister Jaroslaw Kaczynski's September 2006 visit to Washington, D.C., Secretary of State Condoleezza Rice described the two countries as "the best of friends." Early in 2007, after years of informal discussions, the Bush Administration began formal negotiations with Poland and the Czech Republic over a proposal to establish missile defense facilities on their territory to protect against missiles from countries such as Iran and North Korea; the plan would entail placing tracking radar in the Czech Republic and interceptor launchers in Poland. If agreements are struck, and if the Polish and Czech parliaments approve the projects, construction on the sites would likely begin in 2008, with initial deployments expected in 2011. Some Poles believe their country should receive additional security guarantees in exchange for assuming a larger risk of being targeted by rogue state missiles because of the presence of the U.S. launchers on their soil. In addition, many Poles are concerned about Russia's response. The Polish government reportedly has been requesting that the United States provide batteries of Patriot missiles to shield Poland against short- and medium-range missiles. Polls show the Polish public is opposed to such a base. Nevertheless, during a July 2007 meeting in Washington, D.C. with President Bush, President Lech Kaczynski reportedly indicated continued support for the program, and also emphasized the need to bolster Poland's security. In September 2006, President Bush publicly acknowledged the existence of a secret CIA program to detain international terror suspects worldwide. Earlier media reports alleged that Poland and Romania were among the countries that had hosted secret CIA prisons, although officials of both governments have denied these allegations. A European Parliament probe conducted throughout 2006 cited no clear proof of prison sites in Europe, but could not rule out the possibility that Romania had hosted detention operations by U.S. secret services. However, in June 2007 a Council of Europe report claimed to have evidence that U.S. detention facilities had been based in the two countries. President Kaczynski has stated that, since he assumed office, "there has been no secret prison—I am 100 percent sure of it," and that he had been "assured there were never any in the past either." Some Poles have argued that, despite the human casualties and financial costs their country has borne in Iraq and Afghanistan, their loyalty to the United States has gone largely unrewarded. Many have hoped that the Bush Administration would respond favorably by providing increased military assistance and particularly by changing its visa policy, which currently requires Poles to pay a $100 non-refundable fee, and then submit to an interview at a U.S. embassy or consulate—requirements that are waived for most western European countries.

Poland held presidential and parliamentary elections in the fall of 2005. After several months, a ruling coalition consisting of three populist-nationalist parties was formed; the presidency and prime minister's post are held by Lech and Jaroslaw Kaczynski, identical twin brothers who have increasingly consolidated their power. Their government's nationalist policies have caused controversy domestically, in both the political and economic arenas, and in foreign relations as well. Relations with some neighboring states and the European Union have been strained at times, but ties with the United States have not undergone significant change. Some observers believe that a recent dispute within the coalition may spark early elections. This report may be updated as events warrant. See also CRS Report RL32967, Poland: Foreign Policy Trends, and CRS Report RL32966, Poland: Background and Current Issues, both by [author name scrubbed].

As of February 11, 2009, a total of 240 persons have served for 30 years or more in the United States Congress as Representative or Senator. That number is only 2% of the 11,893 men and women who have represented their states and congressional districts since the First Congress convened on March 4, 1789. Of the 240 Members serving 30 years or more, 139 served only in the House of Representatives; 29 served only in the Senate; and 72 served in both chambers. Four of the 240 Members are women, three of whom have served in the House and Senate. Over time, the number of Members serving 30 years or more has grown. Only two Members with over 30 years of service began serving in Congress in the 18 th century: Nathaniel Macon began his service in 1791; Samuel Smith, in 1793. Seven served entirely during the 19 th century. By 1967 (90 th Congress), a total of 100 Members had served 30 years or more. As of February 11, 2009, (111 th Congress) that number had risen to 240. Among Members of the 111 th Congress, 16 incumbent Senators and 18 incumbent Representatives have served 30 years or longer. Table 1 lists Members who have served 30 years or longer in descending order of the length of their congressional service, as measured in days. For each Member, the table presents the Member's party and state represented; dates of the Member's first and last day of service, by chamber; days of service in each chamber; and total days of congressional service. Total service is also presented in years and fractions of years. Calculations of days of service varied according to the pattern of a Member's service. For example— Clarence A. Cannon of Missouri served in one continuous period from 3/4/1923 through 5/12/1964. The elapsed time from one date to the other was 15,045, but because Representative Cannon served for each of the elapsed days and on the first day, we add one day to the elapsed time for a total of 15,046 days. Justin Morrill served in both the House and the Senate, continuously from 3/4/1855 to 3/3/1867 in the House (4,383 days) and from 3/4/1867 to 12/28/1898 in the Senate (11,623 days). Morrill's total congressional service was the sum of those two periods, 16,006 days. Henry Jackson of Washington also served continuously in both the House and the Senate, but because of a statutory change there is an overlap of one day in his official dates of service. Jackson served in the House from 1/3/1941 through 1/3/1953, but his first day in the Senate was also on 1/3/1953. If we simply added his House service (4,384 days) and his Senate service (11,199 days), we would double-count 1/3/1953; so we add the days of service in each chamber (15,583 days) and subtract one day from that sum for Jackson's total days of congressional service (15,582 days). Alternately, we could simply count the days from when his House service started through the date of the day when his Senate service ended. Samuel Smith served in the House, then in the Senate, then again in the House, and then once again in the Senate. His first period of service (in the House) did not overlap with the second (in the Senate). There was a break between his first period of Senate service and his second period of House service, but there is an overlapping day (12/17/1822) when he moved finally from the House again to the Senate. Accordingly, we add the days of each period of service and subtract one day from the sum for a total of 14,276 days of congressional service. Table 1 draws the dates of congressional service from the Biographical Directory of the United States Congress, 1774-Present ; the "Table of United States Senators" in U.S. Congress, Senate, Senate Manual , S. Doc. 104-1; and various editions of the Congressional Directory (Washington: GPO). When a date in the Biographical Directory was unclear, CRS consulted other sources for clarification, as shown in notes to Table 1 .

This report identifies the 240 Members of Congress who have served in Congress for at least 30 years, as of February 11, 2009. Those 240 Members are only 2% of the 11,893 individuals who have represented their states and congressional districts in Congress since 1789. Of the 240 Members with at least 30 years of congressional service, 139 have spent all of their congressional careers in the House; 29 have spent all of their careers in the Senate; and 72 have had combined service in the House and Senate. Among Members of the 111th Congress, 16 Senators and 18 Representatives have served 30 years or more. This report supercedes CRS Report RL30370, by [author name scrubbed], Specialist in American National Government. This report will not be updated.

Members of Congress and the public are increasingly concerned about the ability of the Food and Drug Administration (FDA) to ensure that the drugs sold in the United States are safe and effective. Legislators, industry, the public, and FDA scientists have raised questions about FDA's collection and release of safety data, and whether the agency has the authority and resources to ensure adequate research over the marketing life of the pharmaceutical products it regulates. In 2004, the regulatory, medical, and industry debate became very public with reports of cardiovascular hazards posed by the pain medicine Vioxx (one of several COX-2 nonsteroidal anti-inflammatory drugs then on the market), and of children facing increased risk of suicidal thoughts and actions when taking certain antidepressants (such as the selective serotonin reuptake inhibitors Paxil and Zoloft). Not only was Congress asking whether the manufacturers knew of these risks while continuing to market the drug, but also whether FDA should have known of the risks and done more to protect the public. At the height of public and Congressional attention, FDA asked the Institute of Medicine (IOM) to "conduct an independent assessment of the current system for evaluating and ensuring drug safety postmarketing and make recommendations to improve risk assessment, surveillance, and the safe use of drugs." IOM released its report in September 2006. FDA issued its response in January 2007 and noted relevant activities the agency has begun and others it has planned. Among the planned activities are those in its proposal for a reauthorization of the prescription drug user fee program (PDUFA IV). In the meantime, several Members of Congress have introduced bills to address drug safety and FDA's role in protecting the public's health. This report provides a side-by-side comparison of: Institute of Medicine: recommendations in its September 2006 report, The Future of Drug Safety: Promoting and Protecting the Health of the Public ; Food and Drug Administration: announced actions and plans to address problems identified in the IOM report; S. 468 / H.R. 788 (the Food and Drug Administration Safety Act of 2007), introduced on January 31, 2007, by Senators Grassley, Dodd, Mikulski, and Bingaman, and Representatives Tierney and Ramstad; S. 484 (the Enhancing Drug Safety and Innovation Act of 2007), introduced on February 1, 2007, by Senators Enzi and Kennedy; and H.R. 1165 (the Swift Approval, Full Evaluation (SAFE) Drug Act), introduced on February 16, 2007, by Representative Markey. The bills and the IOM report address many of the same issues, often with similar approaches though at times with major differences. The IOM report addressed only drugs, not biological products (e.g., vaccines), in keeping with the charge FDA gave it. FDA's response to the IOM recommendations, therefore, relates to drugs, but also states that the approach to drug safety is relevant to all medical products. All the bills would amend the Federal Food, Drug, and Cosmetic Act (regarding the regulation of drugs); S. 484 would also amend the Public Health Service Act (regarding the regulation of biologics). Highlighted below are a few of the more significant items regarding drug safety. S. 468 / H.R. 788 would remove the post-approval drug safety activities from FDA's Center for Drug Evaluation and Research (CDER) and create a new Center for Postmarket Evaluation and Research for Drugs and Biologics (the Center). The IOM report does not suggest that approach to strengthen FDA's postmarket activities, nor do the other pending bills. The bills and the IOM recommendations aim to strengthen FDA's ability to make sure drug manufacturers (application sponsors) appropriately design and conduct postmarket studies and disclose the results to the public. S. 468 / H.R. 788 lays out requirements that the new Center for Postmarket Evaluation and Research for Drugs and Biologics would administer; S. 484 would achieve this with a process it calls a Risk Evaluation and Mitigation Strategy (REMS); and H.R. 1165 would allow the Secretary to require certain studies. The IOM recommended and all the bills would allow the Secretary to penalize (through civil fines, injunctions, or withdrawal of marketing approval or licensure) sponsors who do not conduct required studies or complete them on time, or who fail to report study results. The IOM report and the bills address the need for FDA authority to require pre- and postmarket studies. S. 468 alone would give FDA the authority to require that those studies compare a drug's safety and effectiveness with that of other drugs. All three bills would require a variety of drug safety activities. They differ in how to fund them. S. 468 / H.R. 788 would authorize appropriations to carry out the bill's provisions; S. 484 would rely on user fees, expanding FDA's existing authority to use such fees; and H.R. 1165 does not address funding. The IOM committee not only recommended that Congress provide "substantially increased resources" to FDA, but noted that all its other recommendations could not be implemented without those resources. Table 1 addresses the range of FDA drug safety activities that the IOM recommended, along with FDA's response, and activities that the bills would authorize or require. The table structure follows the 25 IOM recommendations within the five categories of organizational culture, science and expertise, regulation, communication, and resources.

Members of Congress and the public are increasingly concerned about the ability of the Food and Drug Administration (FDA) to ensure that the drugs sold in the United States are safe and effective. In November 2004, FDA asked the Institute of Medicine (IOM) to assess the current system for evaluating and ensuring drug safety and to make recommendations to improve risk assessment, surveillance, and the safe use of drugs. IOM released The Future of Drug Safety: Promoting and Protecting the Health of the Public in September 2006, and FDA issued its response in January 2007. The following drug safety bills have been introduced in the 110th Congress: S. 468 / H.R. 788, S. 484, and H.R. 1165. Although the legislation and the IOM report address many of the same drug safety issues, the bills differ in their treatment of FDA authority to require action and to enforce compliance, comparative effectiveness studies, and how to fund any additional agency activities. For example, S. 468 / H.R. 788 would strengthen FDA's post-approval drug safety activities by creating a new Center for Postmarket Evaluation and Research for Drugs and Biologics. The other bills would leave these activities where they currently reside in the Center for Drug Evaluation and Research. All the bills would allow the FDA to penalize (through civil fines, injunctions, or withdrawal of marketing approval or licensure) drug manufacturers who did not conduct required postmarket studies or who failed to report study results. The IOM committee recommended that Congress provide substantially increased resources to FDA to bolster its drug safety activities. S. 468 / H.R. 788 would authorize appropriations to carry out the bill's provisions, S. 484 would rely on user fees, expanding FDA's existing authority to use such fees, and H.R. 1165 does not address funding.

President Bush and Moroccan King Mohammed VI announced at a meeting in Washington, D.C. on April 23, 2002, that the two countries would seek to negotiate a free trade agreement. On October 1, 2002, U.S. Trade Representative Robert Zoellick sent Congress formal notification of the Administration's intention to begin FTA talks with Morocco. In his notification letter, Zoellick stated that the completion of an FTA with Morocco would "support this Administration's commitment to promote more tolerant, open and prosperous Muslim societies." Negotiations for the FTA were launched on January 21, 2003, in Washington. After a total of eight negotiating rounds, U.S. Trade Representative Robert Zoellick and Moroccan Minister Taib Fassi-Fihri reached agreement on March 2, 2004 on a comprehensive FTA. After the required 90-day congressional notification period expired, the two sides signed the agreement on June 15, 2004. Both the Senate and House approved implementing legislation in July 2004, and President Bush signed the legislation into law ( P.L. 108-302 ) on August 3, 2004. The Moroccan Parliament ratified the agreement on January 18, 2005, but subsequently had to legislate changes in the country's intellectual property laws to implement its FTA obligations. According to the Office of the U.S. Trade Representative, Morocco was chosen as an FTA partner for multiple reasons. First, USTR officials stated that a trade agreement with Morocco would further the executive branch's goal of promoting openness, tolerance, and economic growth across the Muslim world. Second, Morocco has been a strong ally in the war against terrorism. Third, the FTA would ensure stronger Moroccan support for U.S. positions in WTO negotiations. Fourth, USTR officials maintained that an FTA would help Morocco strengthen its economic and political reforms. Fifth, the agreement is expected to provide U.S. exporters and investors with increased market access. The Moroccan trade pact is now the fourth FTA (after Israel, Jordan, and Bahrain) the United States has in force with a Middle Eastern country. An agreement with Oman has been signed, but not yet considered by Congress. Each agreement is intended to be an integral part of President Bush's strategy to create a Middle East Free Trade Area by 2013. Morocco is a moderate Arab state which maintains close relations with Europe and the United States. Situated in North Africa on a land mass slightly larger than California, Morocco borders the North Atlantic ocean and Mediterranean Sea between Algeria and Western Sahara. Approximately 99% of its 30 million people are Muslim. The government of Morocco today is a constitutional monarchy. King Mohammed VI, who assumed the throne in July 1999, is the head of state. The constitution grants the King extensive powers, including the authority to appoint the prime minister and several key ministers individually, and approve the Council of Ministers, the power to dismiss the government, the power to dissolve the parliament, and the power to rule by decree. The King also serves as the supreme commander of the armed forces and serves as Morocco's religious leader or "Commander of the Faithful." The King, and not the Prime Minister, also defines the policy directions and priorities of the government. On the one hand, there have been some calls from elements of the Moroccan press for reform of the constitution to reduce the powers of the King, while enhancing the powers of the Parliament. On the other hand, many analysts believe that King Mohammed VI is dedicated to addressing Morocco's underlying social problems, while gradually liberalizing the political system further. Following September 2002 parliamentary elections, King Mohammed named Driss Jettou as Prime Minister and head a six-party center-left coalition government. Mr. Jettou is often described as a forceful technocratic leader. Yet Morocco's over 20 political parties create a fragmented political system, making it difficult for the government to reach consensus on how best to address its many social and economic problems. Critically, high unemployment that averages over 20% in urban areas, increasing income inequality, and widespread poverty provide fertile ground for increasing support for a fundamentalist Islamist movement, al-Adl wal-Ihsane (Justice and Charity). With a per capita income of about $2,000 (2002), Morocco also faces challenges typical of many poor developing countries. These include preparing the economy for freer trade, reducing public sector wage rates and bloated ministries, increasing labor market flexibility and skills, restoring a crumbling infrastructure, and reducing dependence on imported energy. Morocco's economy is based on mining, agriculture, fishing, tourism, a growing manufacturing sector, and a deregulated telecommunications sector. Morocco has the world's largest phosphate reserves, and exports of phosphates from state-owned companies account for about 17% of Morocco's total exports. Agriculture accounts for between 15-20% of GDP and employs between 40-45% of its workforce (services employs around 35% and industry around 15%). Morocco is a net exporter of fruits and vegetables and a net importer of cereals, oilseeds, and sugar. Severe droughts often hurt Morocco's farm production, thereby serving as a drag on economic growth. The Moroccan economy also depends heavily on the inflow of funds from Moroccans working abroad. The illegal production and export of cannabis also plays a role in the economy, particularly in the north. The European Union is its primary trading partner, accounting for nearly 67% of its exports and 55% of its imports in 2002. France is Morocco's single largest trading partner by a wide margin. The United States is a relatively small trading partner, accounting for about 5% of Morocco's total trade. The Bush Administration's decision to negotiate a FTA with Morocco was a surprise to a number of observers. A U.S. Chamber of Commerce official, for example, questioned the decision on the grounds that the United States does not do a lot of business with Morocco and that other Middle Eastern countries, such as Egypt and Turkey, would be more suitable partners. The Bush Administration, backed by a coalition of U.S. companies that support the negotiation, responded that both U.S. economic and political interests (see below) will be well served by the proposed FTA. Before the FTA, U.S. exports to Morocco faced an average tariff of 20% versus a 4% average tariff that Moroccan exports face in the U.S. market. By moving towards duty-free treatment, two-way trade flows should expand beyond the current small $ 854 million level (comprising U.S. exports of $469 million and imports of $385 million in 2003). In addition to the current leading U.S. exports to Morocco (aircraft, corn, and machinery), U.S. exports of products such as wheat, soybeans and feed grains, beef and poultry are expected to increase under the FTA. New commercial opportunities for U.S. exporters may also be derived by offsetting current tariff preferences as embodied in the European Union-Morocco Association Agreement, which became effective on March 1, 2000. This agreement provides preferential tariff treatment for most EU industrial goods, but largely excludes agriculture. Because agriculture will be included in the U.S.-Moroccan FTA, many U.S. agricultural interests believe they can enhance their position vis-a-vis European producers. The U.S.-Moroccan Business coalition also argues that the FTA will increase the access American firms have to Morocco's service sector. Besides telecommunications and tourism, the coalition maintains that new opportunities for U.S. firms in the banking, energy, audio-visual, telecommunications, finance, and insurance sectors are likely to be opened up as a result of Moroccan economic reforms. In addition, the FTA could support the Bush Administration's trade strategy of "competitive liberalization." By helping a developing country that recognizes the importance of trade liberalization as a key ingredient of development, the Moroccan FTA could demonstrate to other developing countries the benefits of economic reform and trade liberalization, including the WTO round of multilateral negotiations - the Doha Development Agenda. As a Chair of the G-77 and Africa Group within the WTO, the Bush Administration maintains that Morocco is in a leading position to promote the benefits of the Doha Round to other developing countries. Similar to the Jordan-U.S. FTA, the FTA with Morocco is viewed by the Administration as a tool to support a moderate Muslim state in the region. By contributing to increased development and prosperity in Morocco, the FTA is intended to contribute to the stability of the region and send a concrete signal to countries in the Middle East about the benefits of closer economic and political ties with the United States. The FTA is also a mechanism for advancing the overall U.S.-Moroccan relationship. As Morocco is one of the strongest U.S. allies in the war on terrorism in the Middle East, the FTA is intended as a reward for its support, as well as send a signal to the rest of the Arab world that the United States wants closer ties. At a time many voices in the Arab and Muslim world are calling for boycotts against the United States, Morocco is seeking a closer economic relationship. The agreement provides that more than 95% of bilateral trade in consumer and industrial products will become duty-free immediately, and all other remaining tariffs will be eliminated within nine years. U.S. export sectors such as information technology products, construction equipment, and chemical stand to benefit. For the import-sensitive textile and apparel sector, trade will be duty-free if imports meet the Agreement's rules of origin. The Agreement requires qualifying apparel to contain either U.S. or Moroccan yarn and fabric and a limited amount of third country content. On agriculture, U.S. poultry, beef, and wheat exports will benefit from liberalization of Morocco's tariff-rate quotas. Morocco will also provide immediate duty-free access on products such as pecans, frozen potatoes, and breakfast cereals and more graduated duty-free access on other products such as soybeans, sorghum, and grapes. For its part, the United States will phase-out all agricultural tariffs, most in fifteen years. Morocco will provide U.S. service providers such as audiovisual, express delivery, telecommunications, computer and related services, construction, and engineering with enhanced access to its market. U.S. banks and insurance companies will have the right to establish subsidiaries and joint ventures in Morocco, as well as the right to establish branches, subject to a four year phase-in for most insurance providers. Protections and non-discriminatory treatment are provided for digital products such as U.S. software, music, text, and videos. Protections for U.S. patents, trademarks, and copyrights parallel and in some cases deepen the standards of other U.S. FTAs. In the area of telecommunications, each government commits to that users of the telecom network will have reasonable and non-discriminatory access to the network. U.S. phone companies will have the right to interconnect with former monopoly networks in Morocco at non-discriminatory, cost-based rates. The agreement provides for anti-corruption measures in government contracting. U.S. companies are provided access to bidding on a range of Moroccan government contracts and procurement. Both countries also commit to enforce their domestic labor and environmental laws, and the agreement includes a cooperative mechanism in both labor and environmental areas. Agricultural producers in the United States welcome the tariff reductions that will be phased in as a result of the FTA. In particular, the American Soybean Association said that the duty on soybeans for processing will be eliminated immediately, and soybeans imported for other uses and processed soy products will be reduced by 50% in the first year of the agreement and phased out over the next five years. Previous import duties in Morocco were 2.5% on soybeans for processing, 25% on soybean meal, and 75.5% for soy products that are used in human food. The National Cattlemen's Beef Association looks forward to increased market access to Morocco's hotel and restaurant industry as Morocco opens its market to U.S. beef with a low in-quota tariff that goes to zero quickly. According the U.S. Trade Representative's Office, producers of poultry, wheat, corn, and sorghum will also gain from the agreement. Most U.S. trade advisory committees endorsed the agreement. The most senior committee, the Advisory Committee for Trade Policy and Negotiations, found the agreement "to be strongly in the U.S. interest and to be an incentive for additional bilateral and regional agreements." Advisory committees on services, goods, and intellectual property also expressed broad support. However, the Labor Advisory Committee expressed concerns that were echoed by several Ways and Means Committee Democrats at the July 7, 2004 hearing. These concerns were basically whether the trade agreement goes far enough in encouraging Morocco to meet basic international labor standards. However, the accord generally is credited with influencing significant labor reforms in Morocco. For example, a new labor law that went into effect on June 8, 2004 (1) raises the minimum employment age from 12 to 15 to combat child labor; (2) reduces the work week from 48 to 44 hours with overtime rates payable for additional hours; (3) calls for periodic review of the Moroccan minimum wage; and (4) guarantees rights of association and collective bargaining and prohibits workers from taking actions against workers because they are union members. The U.S. Department of Labor, meanwhile, has created an assistance program with a budget of nearly $9.5 million to improve industrial relations and child labor standards in Morocco, and the Moroccan government has ratified seven of the eight core International Labor (ILO) conventions.

The United States and Morocco reached agreement on March 2, 2004 to create a free trade agreement (FTA). The Senate approved implementing legislation ( S. 2677 ) on July 2, 2004 by a vote of 85-13 and the House approved identical legislation ( H.R. 4842 ) on July 22, 2004 by a vote of 323-99. The next day, the Senate passed House approved H.R. 4842 without amendment by unanimous consent. The legislation was signed by President Bush into law ( P.L. 108-302 ) on August 3, 2004. The agreement entered into force on January 1, 2006, a year later than planned due to the need for Morocco's Parliament to pass amendments to its intellectual property laws. The FTA is intended to strengthen bilateral ties, boost trade and investment flows, and bolster Morocco's position as a moderate Arab state. More than 95% of bilateral trade in consumer and industrial products became duty-free upon entry into force, while most other remaining barriers are to be phased out over a number of years. This report will be updated later this year.

"Child care reauthorization" is composed of two parts: legislation to reauthorize the ChildCare and Development Block Grant (CCDBG) Act and legislation to extend mandatory fundingappropriated under Section 418 of the Social Security Act. The CCDBG Act authorizesdiscretionary funds and contains all provisions pertaining to the administration of CCDBG programs. Section 418 of the Social Security Act appropriates mandatory money to be administered underprovisions included in the CCDBG Act. The 108th Congress did not complete action to reauthorize either the CCDBG Act itself, orthe mandatory child care funding appropriated under the Social Security Act (along with theTemporary Assistance for Needy Families block grant). Both expired at the end of FY2002. However, funding for the CCDBG has been continued via a series of temporary extensions (in thecase of the mandatory funding) and annual appropriations law (for the discretionary funding portion). In terms of reauthorization legislation, the House passed a consolidated bill, H.R. 4 (Personal Responsibility, Work, and Family Promotion Act of 2003), whichincluded discretionary funding authorization, a mandatory appropriation, and amendments to theCCDBG Act (alongside provisions to amend and extend funding for Temporary Assistance forNeedy Families [TANF] (1) ). In the Senate, two separate bills were reported from their respective committees, butultimately failed to reach a final vote on the full Senate floor. The Senate Finance Committee'sreported substitute version of H.R. 4 (Personal Responsibility and IndividualDevelopment for Everyone Act [PRIDE]) included mandatory funding for child care, while theSenate Health, Education, Labor, and Pensions Committee's reported bill, S. 880 (TheCaring for Children Act of 2003), included all provisions pertaining to discretionary fundingauthorization, and would have amended the CCDBG Act itself. Although the Senate bills nevermade it to a final floor vote, it should be noted that when the legislation was brought to the floor, oneamendment, offered by Senator Snowe, was accepted (78-20). That amendment proposed to increasemandatory child care funding above the amounts proposed in the House-passed, and Senatecommittee bill. Below is a summary of key provisions in all three bills (and the Snowe amendment,as passed on the floor), followed by Table 1 , a detailed side-by-side comparison of each bill'sprovisions with current law. (2) Discretionary Authorization. The discretionaryportion of child care funding is authorized by the Child Care and Development Block Grant Act (asamended in 1996). Under current law, discretionary CCDBG funding is authorized at $1 billionannually. However, actual appropriation levels, determined during the annual appropriationsprocess, have exceeded the authorized level (e.g., FY2004 = $2.1 billion). Both the House versionof H.R. 4 (The Personal Responsibility, Work, and Family Promotion Act of 2003), and S. 880 (The Caring for Children Act of 2003) proposed to authorize discretionaryfunding at $2.3 billion in FY2004, rising by $200 million each year, up to $3.1 billion in FY2008. (The discretionary funding authorization does not fall under the Senate Finance Committee'sjurisdiction, and therefore was not addressed in the Senate committee-reported version of H.R.4.) Mandatory Appropriation. Mandatory fundingfor the CCDBG was preappropriated in Section 418 of the Social Security Act for FY1997-2002,as part of the welfare law of 1996 ( P.L. 104-193 ). A series of temporary extensions have continuedthat funding since the close of FY2002. Funding has been maintained at the FY2002 annual rate of$2.717 billion. The House-passed version of H.R. 4 would have set mandatory child carefunding at $2.917 billion for each of FY2004-2008 (for an increase of $1 billion over five yearsabove current funding). The version of H.R. 4 reported by the Senate Finance Committeecontained the same $1 billion increase in mandatory child care funding over five years; however,Senator Snowe expressed plans at the time of voting for the committee bill to offer an amendmentfor a greater child care increase when the bill was brought to the Senate floor. (The mandatoryfunding does not fall under Senate HELP Committee jurisdiction, and therefore was not addressedin S. 880 .) When the bill was considered on the floor (March 30, 2004), S.Amdt. 2937 (Snowe) was offered and approved by a vote of 78-20. The amendment would have provided anadditional $6 billion (over five years) in mandatory child care funding, above the $1 billion ($200million in each of five years) provided in the underlying bill, H.R. 4 (as passed by theHouse, and as passed by the Senate Finance Committee). The additional $6 billion would have beenallotted among the years as follows: $700 million in FY2005; $1 billion in FY2006; $1.2 billion inFY2007; $1.4 billion in FY2008; and $1.7 billion in FY2009. Authority to Transfer TANF Funds. Undercurrent law, states have the authority to transfer up to 30% of their annual TANF block grant to theCCDBG (only 20% if they choose to transfer 10% to the Social Services Block Grant). TheHouse-passed version of H.R. 4 would have allowed states to transfer up to 50% of theirannual TANF grants to the CCDBG. The Senate version of H.R. 4 proposed to maintaincurrent law. Use of Funds for Direct Services. Current lawincludes no provision requiring a given percentage of funds appropriated under the CCDBG Act tobe spent on direct services. S. 880 would have required that after the reservation ofset-asides, at least 70% of the funds remaining be used to fund direct services (as defined by thestate). The House bill had no comparable provision. Option to Use Excess Funds for Increasing PaymentRates. S. 880 would have allowed states that receive funding abovetheir FY2003 levels to use a portion of the excess to support payment rate increases for providersand to establish tiered payment rates. Under S. 880 , stricter requirements to set paymentrates in accordance with biennial market rate surveys would have been added to the statute. Quality Set-Aside. Current law requires that atleast 4% of each state's total CCDBG expenditures (from all sources -- e.g., mandatory,discretionary, matching funds) be used for quality activities, described as: providing comprehensiveconsumer education to parents and the public, activities that increase parental choice, and activitiesdesigned to improve the quality and availability of child care in the state. Both the House-passed version of H.R. 4 and the HELP Committee's S. 880 would have raised the percentage of CCDBG funds that must be spent for qualityactivities to a minimum of 6%. Definition of "Quality Activities". Both billsprovided greater detail than current law in terms of defining what classifies as a "quality activity." In each, categories of activities were outlined to include school readiness activities (includingactivities to enhance early literacy); training and professional development for staff; and initiativesor programs to promote or increase retention of qualified staff. The categories reflected a newemphasis on school readiness as a goal of the CCDBG. The Senate bill ( S. 880 ) alsospecified that quality funds could have been spent on evaluating and assessing the quality ofprograms, and their effectiveness in improving overall school preparedness. While S. 880clearly stated that quality funds must be spent for any of the six listed purposes, H.R. 4 (House) provided three broad categories, similar in topic to those in S. 880, with a fourth,more general category of "other activities as approved by the state." Federal law currently requires that children eligible for services under the CCDBG must havefamily income that does not exceed 85% of the state median (for a family of that size). However,states have the discretion to adopt income eligibility limits below this federal maximum. Both theHouse-passed version of H.R. 4 and S. 880 proposed to eliminate thefederal maximum of 85% of state median income (SMI) from the CCDBG law, replacing it with aprovision allowing states to set income eligibility levels (with no federal ceiling), with prioritiesbased on need. Under current CCDBG law, states are required to submit plans every two years, certifyingthat their CCDBG programs include specified elements addressing areas such as parental choice,parental access, consumer education, licensing, and health and safety requirements. Both the House version of H.R. 4 and the HELP Committee's S. 880 would have amended current law to require that additional elements be certified in their stateplans. Areas that would have been modified or added related to providing consumer educationinformation; describing or demonstrating state coordination of child care services with other earlychildhood education programs; certifying compliance with the quality set-aside percentagerequirement; and addressing special needs child care. Unlike the House version of H.R. 4 , S. 880 included provisionsrequiring that in their state plans, states demonstrate that the process for redetermining eligibilityoccur no more frequently than every six months (with limited exceptions), and also that the state plandescribe any training requirements in effect for child care providers. The Senate bill would also haveput into statute the requirement that the provider payment rates, described in the state plan, be setin accordance with a statistically valid and reliable biennial survey of market rates (without reducingthe number of families served). State plans would also have been required to include the results ofthose surveys and to contain a description of how the state will provide for timely payment toproviders. Results of the survey would also have been required to be made available to the publicno later than 30 days after the survey's completion. Current law specifies a set of data reporting requirements for states to collect in theadministration of their CCDBG programs. States collect data on a monthly basis and submit to theDepartment of Health and Human Services (HHS) disaggregated data on a quarterly basis. Anaggregate report is required to be submitted to HHS on an annual basis. S. 880 would have retained the quarterly reporting in current law, but wouldhave amended the list of data elements that states would be required to collect on a monthly basis. (See Table 1 for details.) It would also have eliminated the separate annual report, instead requiringthat the fourth quarterly report include information on the annual number and type of child careproviders and the method of payment they receive. The House version of H.R. 4 wouldhave retained current law, containing none of these provisions. Titles II and III of S. 880 proposed provisions that stood apart from CCDBG lawor Section 418 of the Social Security Act. Title II of the bill contained provisions to enhance securityat child care centers in federal facilities, and Title III would have established a small business childcare grant program, through which competitive grants would have been awarded to states forestablishment and operation of employer-operated child care programs. Table 1 provides a detailed comparison of the child care provisions included in theHouse-passed and Senate Finance Committee-reported versions of H.R. 4 , the SenateHELP Committee-reported S. 880 , with current law. In some cases, current law refersto the Child Care and Development Block Grant Act, while current law provisions pertaining to themandatory child care funding are included in Section 418 of the Social Security Act. The bracketedreferences in each of the cells refer to the section of the applicable law or proposed bill. In thesection regarding the mandatory (entitlement) funding, the Snowe amendment, as passed during theshort-lived Senate floor consideration is noted. Table 1. Comparison of Current Law with Child Care Provisions in H.R. 4 as Passed by the House, asReported by the Senate Finance Committee, and S. 880

The 108th Congress did not complete action to reauthorize child care legislation that expiredat the end of FY2002, but funding has continued via a series of temporary measures, and annualappropriations. "Child care reauthorization" is composed of two parts: legislation to reauthorize theChild Care and Development Block Grant (CCDBG) Act and legislation to extend mandatoryfunding appropriated under Section 418 of the Social Security Act. In February 2003, the House passed a consolidated bill, H.R. 4 , whichencompassed both parts of reauthorization by including provisions that would have addressedmandatory appropriations, discretionary funding authorization levels, and other amendments to theCCDBG Act. The Senate Finance Committee reported its own version of H.R. 4, whichincluded mandatory child care funding, and the Senate Health, Education, Labor, and Pensions(HELP) Committee reported a separate bill, S. 880 , which included all provisionspertaining to discretionary funding authorization, and amended the CCDBG Act itself. The fullSenate began consideration of H.R. 4 on March 29, 2004, passing one amendment toit (to increase child care funding), but then failed to resume consideration of the bill. Both versions of H.R. 4 originally proposed to appropriate $2.917 billion inmandatory CCDBG funding for each of fiscal years 2004 through 2008, which would have reflectedan increase of $1 billion over five years above current (FY2002) funding. (The amendment approvedon the Senate floor would have provided an additional $6 billion, on top of the $1 billion.) Discretionary funding levels are authorized within the CCDBG Act, and both the House version ofH.R. 4 and S. 880 proposed to authorize $2.3 billion in FY2004, rising up to$3.1 billion in FY2008. Also of note, H.R. 4 (House) would have allowed states to transferup to 50% of their TANF block grants to the CCDBG (rather than current law's limit of 30%). Both H.R. 4 (House) and S. 880 would have revised and expandedthe CCDBG program goals to include and emphasize school readiness. Of the two bills, S.880 provided the greater detail in terms of defining the skills and development to befostered in efforts to prepare children for school. Both bills included provisions to increase theminimum quality set-aside from 4% to 6%, and to define "quality activities" in more detail. Both bills proposed to eliminate the federal eligibility ceiling (85% of state median income);and to place new requirements on state plans to emphasize coordination, consumer education, andprogram quality. S. 880 would have also strengthened requirements (currently only inregulation) that states set provider payment rates in accordance with a recent market rate survey.Other provisions in S. 880 included amending the list of data elements collected on amonthly basis; enhancing security at federal child care facilities, and establishing a small businesschild care grant program. This report provides a side-by-side comparison of the proposed bills, andwill not be updated.

T he Public Safety Officers' Benefits (PSOB) program was authorized by P.L. 94-430 , the Public Safety Officers' Benefits Act of 1976 ("the PSOB Act"). The PSOB program was "designed to offer peace of mind to men and women seeking careers in public safety and to make a strong statement about the value that America places on the contributions of those who serve their communities in potentially dangerous circumstances." The program was created by Congress out of a concern that "the hazards inherent in law enforcement and fire suppression and the low level of state and local death benefits might discourage qualified individuals from seeking careers in public safety, thus hindering the ability of communities to protect themselves." The PSOB program is administered by the Department of Justice, Bureau of Justice Assistance's (BJA's), PSOB Office. The PSOB Office is responsible for reviewing, processing, and making determinations about claims for benefits under the PSOB program. The PSOB program originally provided only death benefits to survivors of public safety officers killed in the line of duty. Since its inception in 1976, the PSOB program has been expanded to provide disability benefits to public safety officers disabled by an injury suffered in the line of duty and education benefits to the spouses and children of public safety officers killed or disabled in the line of duty. Each of these benefits is discussed in more detail below. The PSOB death benefit is a mandatory program, and the disability and education benefits are discretionary programs. As such, Congress appropriates "such sums as are necessary" each fiscal year to fund the PSOB death benefit program while appropriating separate amounts for both the disability and education benefits programs. Only individuals who are public safety officers, or their eligible survivors, are eligible to receive PSOB benefits. For the purposes of the PSOB Act, a "public safety officer" is defined as an individual serving a public agency in an official capacity, with or without compensation, as a law enforcement officer, firefighter, or a chaplain; an employee of the Federal Emergency Management Agency (FEMA) who is performing official duties, if those official duties are related to a major disaster or emergency that has been or is later declared to exist with respect to the area under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 et seq.) and are determined by the Administrator of FEMA to be hazardous duties; an employee of a state, local, or tribal emergency management or civil defense agency who is performing official duties in cooperation with FEMA, if those official duties are related to a major disaster or emergency that has been or is later declared to exist with respect to the area under the Robert T. Stafford Disaster Relief and Emergency Assistance Act and are determined by the head of the agency to be hazardous duties; or a member of a rescue squad or ambulance crew who, as authorized or licensed by law and by the applicable agency or entity, is engaging in rescue activities or providing emergency medical services. The PSOB program provides a death benefit to eligible survivors of a public safety officer whose death is the direct and proximate result of a traumatic injury sustained in the line of duty or certain work-related heart attacks or strokes. To receive a death benefit, the claimant must establish that the public safety officer died as the direct and proximate result of an injury sustained in the line of duty. Under the program, it is presumed that a public safety officer who dies from a heart attack, stroke, or vascular rupture while engaged in, on duty after, or within 24 hours of participating in a non-routine stressful or strenuous physical law enforcement, fire suppression, rescue, hazardous material response, emergency medical services, prison security, disaster relief, or other emergency response activity or a training exercise involving non-routine stressful or strenuous physical activity, has died in the line of duty for death benefit purposes. However, the statutory presumption can be overcome with competent medical evidence to the contrary. The PSOB program pays a one-time lump sum death benefit to eligible survivors of a public safety officer killed in the line of duty. The amount paid to the officer's survivors is the amount authorized to be paid on the date that the officer died, not the amount authorized to be paid on the date that the claim is approved. The current death benefit is $350,079. Survivors of state and local law enforcement officers and firefighters may receive a death benefit if the officer or firefighter died on or after September 29, 1976. Survivors of federal law enforcement officers and firefighters may receive a death benefit if the officer or firefighter died on or after October 12, 1984. A death benefit may be awarded to survivors of members of federal, state, and local public rescue squads or ambulance crews who died on or after October 15, 1986. A death benefit may be awarded to survivors of FEMA personnel and state, local, and tribal emergency management and civil defense agency employees working in cooperation with FEMA who died on or after October 30, 2000. Survivors of chaplains who serve a police or fire department in an official capacity who died on or after September 11, 2001, are eligible to receive a death benefit under the PSOB program. Finally, the survivors of an officer who died of a heart attack, stroke, or vascular rupture on or after December 15, 2003, are eligible to receive a death benefit. PSOB death benefits are paid to eligible survivors in the following order: If the officer is survived by only a spouse and no children, 100% of the death benefit goes to the spouse. If the officer is survived by a spouse and children, 50% of the death benefit goes to the spouse and the remaining 50% is distributed equally among the officer's children. If the officer is survived by only children and not a spouse, the death benefit is equally distributed among the officer's children. If the officer is survived by neither a spouse nor children, the death benefit is paid to the individual(s) designated by the officer in the most recently executed designation of beneficiary on file at the time of the officer's death. If the officer does not have a designation of beneficiary on file, the benefit is paid to the individual(s) designated by the officer in the most recently executed life insurance policy on file at the time of the officer's death. If the officer is survived by neither a spouse nor eligible children, and the officer does not have a life insurance policy, the death benefit is equally distributed between the officer's surviving parents. If the officer is survived by neither a spouse, nor eligible children, nor parents, and the officer did not have a designation of beneficiary or a life insurance policy on file at the time of his or her death, the benefit is paid to surviving adult, non-dependent, children of the officer. Title XIII of P.L. 101-647 expanded the scope of the PSOB program to provide a disability benefit to public safety officers who have been permanently and totally disabled as the direct and proximate result of a catastrophic injury sustained in the line of duty, if the injury permanently prevents the officer from performing any gainful work. The claimant is responsible for establishing that he or she suffered a permanent and total disability as the direct and proximate result of an injury sustained in the line of duty. Like the PSOB death benefit program, the disability benefit program pays a one-time lump sum disability benefit to public safety officers disabled in the line of duty. The current disability benefit is $350,079. Most public safety officers (federal, state, and local law enforcement officers; firefighters; and members of rescue squads and ambulance crews) are eligible to receive disability benefits if they were disabled by an injury suffered in the line of duty on or after November 29, 1990. As of October 30, 2000, employees of FEMA and state, local, and tribal emergency management and civil defense agency employees working in cooperation with FEMA are also eligible to receive disability benefits. Chaplains who serve a police or fire department in an official capacity who are disabled on or after September 11, 2001, are also eligible to receive disability benefits under the PSOB program. A death or disability benefit will not be paid if the fatal or catastrophic injury was caused by the intentional misconduct of the public safety officer or the officer's intention to bring about his or her death, disability, or injury; if the public safety officer was voluntarily intoxicated at the time of his or her fatal or catastrophic injury; if the public safety officer was performing his or her duties in a grossly negligent manner at the time of his or her fatal or catastrophic injury; if an eligible survivor's actions were a substantial contributing factor to the officer's fatal or catastrophic injury; or with respect to any individual employed in a capacity other than a civilian capacity. When making a determination about whether a death or disability benefit is to be paid, the PSOB Office is required to presume that none of the above conditions applied in the case of the officer's death or disability. In addition, the PSOB Office shall not determine that the above conditions applied absent clear and convincing evidence. The Federal Law Enforcement Dependents Assistance Act of 1996 ( P.L. 104-238 ) authorized the Public Safety Officers' Educational Assistance (PSOEA) program. PSOEA provides assistance to spouses and children of public safety officers killed or disabled in the line of duty who attend a program of higher education at an eligible educational institution. PSOEA funds may be used to defray expenses associated with attending college, including tuition, room and board, books, supplies, and education-related fees. The spouse of a deceased or disabled public safety officer is eligible to receive education benefits under PSOEA anytime during his or her lifetime. However, the child of a deceased or disabled public safety officer is no longer eligible for assistance after his or her 27 th birthday, absent a finding of extraordinary circumstances. However, the age limitation can be extended for certain circumstances related to delays in approving a claim for benefits. A spouse or child of a deceased or disabled public safety officer cannot receive PSOEA funds for more than 45 months of full-time education or a proportionate period of part-time education. Currently, the amount of the PSOB educational benefit is $1,041 per month of full-time college attendance. Under the PSOEA program, the families of federal, state, and local police, fire, and emergency public safety officers are covered for line-of-duty deaths that occurred on or after January 1, 1978. Families of disabled federal law enforcement officers are eligible for benefits if the officer was disabled on or after October 3, 1996, whereas families of disabled state and local police, fire, and emergency public safety officers are eligible for benefits if the officer was disabled on or after November 13, 1998. Families of FEMA personnel and state, local, and tribal emergency management and civil defense agency employees are covered for such injuries sustained on or after October 30, 2000. Claimants are allowed to appeal claims that are denied by the PSOB Office. A claimant has 33 days after being served with a notice of denial to request a determination by a hearing officer. The claimant may file supporting evidence or legal arguments along with the request for a hearing officer determination. After the appeal is assigned to a hearing officer, the claimant is notified that any supporting evidence and legal arguments he or she wishes to provide must be filed with both the hearing officer and the PSOB Office. The hearing officer, who reviews the claim de novo—meaning that the hearing officer reviews the entire claim anew rather than reviewing the finding, determinations, decisions, judgments, rulings, or other actions of the PSOB Office—and makes a determination. A claimant appealing the denial of a death or disability benefit can request that the hearing officer hold a hearing. A request for a hearing will not be granted if the claimant does not request a hearing within 90 days of the claim being assigned to a hearing officer, unless, for good cause shown, the Director of BJA (the Director) extends the filing deadline. The purpose of the hearing is to allow the hearing officer to collect evidence from the claimant and his witnesses and any other evidence the hearing officer may decide is necessary or useful. At the hearing, the hearing officer may exclude evidence whose probative value is substantially outweighed by undue delay, waste of time, or needless presentation of cumulative evidence. Witnesses (other than the claimant and anyone who the claimant has shown to be essential to the presentation of the claim) are prevented from hearing the testimony of other witnesses at the hearing. If a claim is denied by the hearing officer, the claimant can appeal to the Director. If the denied claim is not appealed to the Director, the hearing officer's determination is considered the final agency determination of the claim. A claimant has 33 days after being notified by the hearing officer that the claim has been denied to file an appeal with the Director, unless, for good cause shown, the Director extends the filing deadline. Like the request for a hearing officer determination, the claimant may file supporting evidence or legal arguments along with the request for an appeal. If the Director denies the claim, the claimant can appeal the denial in the United States Court of Federal Claims pursuant to 28 U.S.C. § 1491(a). However, to petition the court to review the denial of a claim, the claimant must exhaust the administrative remedies available, meaning that the claimant must have asked for both a hearing officer determination and a Director review. The Director's determination constitutes the final agency determination of the claim.

The Public Safety Officers' Benefits (PSOB) program provides three different types of benefits to public safety officers and their survivors: death, disability, and education benefits. The PSOB program is administered by the Department of Justice, Bureau of Justice Assistance's (BJA's) PSOB Office. The PSOB death benefit is a mandatory program, and the disability and education benefits are discretionary programs. As such, Congress appropriates "such sums as are necessary" each fiscal year to fund the PSOB death benefit program while appropriating separate amounts for both the disability and education benefits programs. The PSOB program provides a one-time lump sum death benefit to eligible survivors of public safety officers whose deaths are the direct and proximate result of a traumatic injury sustained in the line of duty or from certain line-of-duty heart attacks, strokes, and vascular ruptures. The PSOB program provides a one-time lump sum disability benefit to public safety officers who have been permanently and totally disabled by a catastrophic injury sustained in the line of duty, if the injury permanently prevents the officer from performing any gainful work. The PSOB program also provides assistance for higher education expenses (e.g., tuition and fees, books, supplies, and room and board) to spouses and children of public safety officers who have been killed or disabled in the line of duty. Educational assistance is available to the spouse and children of a public safety officer after the PSOB death or disability claim has been approved and awarded. Claimants have the opportunity to appeal denied claims. If the PSOB Office denies a claim, the claimant can request that a hearing officer review the claim. If the hearing officer denies the claim, the claimant can request that the Director of BJA review the claim. Claimants may file supporting evidence or legal arguments along with their request for a review by a hearing officer or the Director. If the claim is denied by the Director, claimants can appeal the denial in the United States Court of Federal Claims pursuant to 28 U.S.C. §1491(a).

Hamas, a U.S. State Department-designated Foreign Terrorist Organization, surprised most observers by winning a majority of seats in the Palestinian legislative election in January 2006. The election was judged by international observers to be competitive and "genuinely democratic." Hamas had boycotted previous Palestinian national elections because they were held under the terms of the Oslo Accords, which the group rejected. Immediately after the election, the Middle East Quartet (the United States, Russia, the European Union (EU), and the United Nations) indicated that assistance to the PA would only continue if Hamas renounced violence, recognized Israel, and accepted previous Israeli-Palestinian agreements, which Hamas refused to do. In March 2006, Hamas formed a government without Fatah, the secular party that had dominated Palestinian politics for decades, which refused to join a Hamas-led coalition. On April 7, 2006, the United States and the EU announced they were halting assistance to the Hamas-led PA government but that humanitarian aid would continue to flow through international and non-governmental organizations (NGOs). The EU has been the PA's largest donor since it was created in 1996 under the Oslo peace accords. At the same time, Israel began withholding about $50 million in monthly tax and customs receipts that it collects for the PA. In 2005, international assistance and the Israeli-collected revenues together accounted for about two-thirds of PA revenues. In addition, the PA lost access to banking services and loans as banks around the world refused to deal with the it for fear of running afoul of U.S. anti-terrorism laws and being cut off from the U.S. banking system. The resulting fiscal crisis left the Hamas-led government unable to pay wages regularly and deepened poverty levels in the Palestinian territories. The Hamas-led government was forced to rely on shrinking domestic tax revenues and cash that Hamas officials carried back from overseas. Press reports indicate that much of this cash emanated from Iran. By the end of 2006, tensions in the West Bank and Gaza Strip were rising as living conditions deteriorated and PA employees, including members of the security forces, went unpaid for weeks or months. Armed supporters of Fatah and Hamas clashed repeatedly, trading accusations of blame, settling scores, and drifting into lawlessness. More than 100 Palestinians were killed in the violence. After months of intermittent talks, on February 8, 2007, Fatah and Hamas signed an agreement to form a national unity government aimed at ending both the spasm of violence and the international aid embargo that followed the formation of the initial Hamas-led government. The accord was signed by PA President and Fatah leader Mahmud Abbas and Hamas political leader Khalid Mish'al in Mecca, Saudi Arabia, after two days of talks under the auspices of Saudi King Abdullah. Under the agreement, Ismail Haniyeh of Hamas remains prime minister. In the new government, Hamas controls nine ministries and Fatah six, with independents and smaller parties heading the remainder. Among the independents are Finance Minister Salam Fayyad, an internationally respected economist, and Foreign Minister Ziad Abu Amr, a reformer and ally of President Mahmud Abbas. Demonstrating the differing priorities of Fatah and Hamas, the new government's platform calls for establishment of a Palestinian state "on all the lands that were occupied in 1967 with Jerusalem as its capital," and at the same time affirms the Palestinians' right to "resistance in all its forms" and to "defend themselves against any ongoing Israeli aggression." The new government commits to "respect" previous agreements signed by the Palestine Liberation Organization (PLO) but does not explicitly renounce violence or recognize Israel. The government platform states that any peace agreement reached will be submitted for approval to either the Palestine National Council (the PLO legislature) or directly to the Palestinian people in a referendum. The Bush Administration expressed disappointment with the unity government platform and said that Prime Minister Haniyeh of Hamas had "failed to step up to international standards." The Administration, however, is keeping open the option of meeting with non-Hamas members of the new government. A spokeswoman for the U.S. Consulate in Jerusalem said "We won't rule out contact with certain individuals with whom we have had contact before. We will evaluate the situation as we go along." On March 20, U.S. Consul General in Jerusalem Jacob Walles met with Palestinian Finance Minister Fayyad in Ramallah, the first diplomatic contact between the United States and the Palestinians in a year. On April 17, Secretary of State Condoleezza Rice held a half-hour meeting with Fayyad at the State Department. According to press reports, Fayyad separately controls accounts held by the PLO, and U.S. officials are examining regulatory ways to allow donor funds from Arab and European countries—but not from the United States—to flow to those accounts without violating U.S. law. The Administration also has sought to redirect some assistance to PA President Abbas. In late 2006, the State Department notified Congress of the President's intent to reprogram up to $86 million in prior-year funding to support efforts to reform and rehabilitate Palestinian civil security forces loyal to Abbas. However, the House Appropriations Committee placed a hold on these funds, seeking more information on where and why the money was to be spent. After the Palestinians reached agreement on the Fatah-Hamas power sharing arrangement, other Members of Congress reportedly expressed further doubts about where the money was going, fearing it may end up with Hamas. In March 2007, Secretary Rice told a House Appropriations subcommittee that the Administration was now seeking $59 million for Abbas ($43 million for training and non-lethal assistance to the Palestinian Presidential Guard and $16 million for improvements at the Karni crossing, the main terminal for goods moving in and out of Gaza). No holds were placed on this request. The EU's reaction to the Palestinian unity government has tracked closely with the United States thus far. EU officials have begun meeting with non-Hamas members of the PA government, but left in place the ban on direct aid. The EU has had some success in forging consensus on its approach to the Israeli-Palestinian conflict over the last few years. The EU views resolving the Israeli-Palestinian conflict as key to reshaping the Middle East and promoting stability on Europe's periphery. Moreover, EU member states are committed to maintaining a common EU policy on this issue to boost the credibility of the Union's evolving Common Foreign and Security Policy. Still, differences persist among member states. According to some press reports, France, Spain, and Italy may be more inclined to resume direct aid to the PA in the near term while other EU members, such as the UK and Germany, are more wary. A Quartet statement after the unity government was formed said it will be measured not only on the basis of its composition and platform, "but also its actions." Some observers saw this as a softening of the Quartet position, which could allow for a possible resumption of direct aid. European officials reportedly argued for more flexibility, saying the government should not be judged purely on the semantics of its official platform but on the future actions of Hamas. Many European policy makers hope that this strategy will encourage a further moderation of Hamas' position and facilitate forward movement in the peace process. Defying the EU policy, 10 European Parliament members met with Hamas Prime Minister Haniyeh in Gaza on May 1. An EU spokesman said there had been no change in the EU policy. Norway, which is not a member of the EU, has gone the farthest among European states by normalizing relations with the Palestinian government and announcing it was prepared to resume direct aid to the PA. Norwegian Foreign Minister Jonas Gahr Stoere met with Prime Minister Haniyeh in March. Although a member of the Quartet, Russia has taken a different approach to the Hamas government from the beginning by maintaining contact with Hamas officials and recently arguing to lift the aid embargo. Hamas political leader Khalid Mish'al has twice visited Moscow since Hamas took power, most recently in February 2007. Foreign Minister Sergey Lavrov has urged Hamas leaders to meet the Quartet conditions, but without success. Russian officials prefer to keep lines of communication open with all parties as they seek to position themselves as a mediator between Arabs and Israelis. This in turn would serve their larger ambition of reestablishing Moscow as a significant player in the region. Nonetheless, the Russians continue to see the Quartet as a useful and necessary mechanism and are unlikely to break ranks with it completely. Neither the U.N. Security Council nor the U.N. General Assembly have adopted resolutions or taken a position in response to the formation of the unity government. U.N. officials continue to stress the necessity for the Palestinian government to meet the three Quartet conditions. Secretary-General Ban Ki-Moon declined to meet Hamas officials on a March visit to the region. After meeting with PA President Abbas, Ban welcomed the new government's formation, but said that "the atmosphere is not fully right" for talks with Hamas. After brokering the Mecca Accord, the Saudis continued their diplomatic push at the Arab League summit in Riyadh in March. During a speech at the summit, Saudi King Abdullah called for an end to the international boycott of the PA in light of the agreement between Fatah and Hamas to form a unity government. In addition, the summit communiqué relaunched the Arab Peace Initiative of 2002, which calls for full Israeli withdrawal from the territories occupied in 1967, creation of an independent Palestinian state with East Jerusalem as its capital, and a just, agreed upon solution to the refugee problem in exchange for an end-of-conflict agreement in which all Arab states would enter into peace agreements and establish normal relations with Israel. Analysts speculate that the recent Saudi diplomatic drive has several purposes. First is to end the intra-Palestinian violence and resume long-stalled peace negotiations with Israel. Second, by securing Arab and perhaps international recognition of a government that includes Hamas and then relaunching peace talks with full Arab backing, the Saudis hope to bring Hamas into the Arab consensus, moderate its anti-Israeli ideology, and ultimately get it to accept a two-state solution. Finally, by creating momentum toward peace, the Saudis are seeking to undermine the regional influence of Iran and rejectionist groups like Hezbollah. Some observers also note that Saudi efforts to gain acceptance of the unity government and restart Israeli-Palestinian peace talks may be an effort to set the price for Saudi cooperation on other U.S. policies in the region, notably toward Iran. Among the Arab states, only Libya refused to attend the Riyadh summit and join the call to back the new Palestinian government and the Arab peace initiative. The Arab League subsequently appointed Jordan and Egypt to promote the initiative with Israel and persuade it to accept the plan as the basis for peace talks. Jordan's King Abdullah II has been the most outspoken Arab leader on the need to seize the Arab peace initiative as a way to restart Israeli-Palestinian peace talks. In March 2007, speaking to a joint meeting of Congress, he urged renewed international, and especially U.S., engagement to move the process forward. In April, he told a group of visiting Israeli Knesset (parliament) members that the initiative was a historic opportunity for Israel to gain recognition by the Arab states and true integration into the region. The Israeli government is maintaining a complete ban on meetings with Palestinian ministers, including non-Hamas ministers, and continues to withhold tax and customs revenues that it collects on behalf of the PA. Israel is unwilling to enter into direct talks with a Palestinian government that includes Hamas, which has killed hundreds of Israelis in terrorist attacks and whose charter calls for an Islamic state in all of the former British mandate of Palestine. However, Prime Minister Ehud Olmert meets regularly with PA President Abbas and in mid-April the two reportedly discussed economic aspects of a future Palestinian state. Olmert has also spoken of "positive aspects" of the Arab peace initiative and stated his willingness to meet any Arab leader to discuss it. Since the early 1990s, Iran has supplied cash, arms, and training to Hamas, but most observers say the relationship has been an uneasy one. Iran has sought a foothold in the Palestinian territories, while Hamas jealousy guards its political and operational independence. The relationship has been relatively unaffected by the widening rift between Sunni and Shiite Islam, although Hamas protested the December 2006 execution of Saddam Hussein by the pro-Iranian government of Iraq. Since the aid boycott was enacted, Iran has increased its assistance to Hamas. Hamas officials visiting Tehran in the past year often returned carrying large sums of cash, according to press reports. The International Monetary Fund (IMF) estimates that in 2006 some $70 million in cash was carried into the territories, most of it thought to be from Iran. After a visit to Iran in December 2006, Prime Minister Haniyeh said Iran had agreed to provide $120 million in assistance in 2007 and up to $250 million in total. Israeli security officials have warned of growing Iranian influence in Gaza. The head of the Israel Defense Force Southern Command, Maj. Gen. Yoav Galant, said in April 2007 he believes a large number of "Iranian terror and guerrilla experts" are operating in the Gaza Strip, training Palestinian terrorists. On December 21, 2006, President Bush signed into law P.L. 109-446 , the Senate version of the Palestinian Anti-Terrorism Act of 2006, which bars aid to the Hamas-led Palestinian government unless, among other things, it acknowledges Israel's right to exist and adheres to all previous international agreements and understandings. It exempts funds for humanitarian aid and democracy promotion. It also provides $20 million to establish a fund promoting Palestinian democracy and Israeli-Palestinian peace. The law limits the PA's representation in the United States as well as U.S. contact with Palestinian officials. In a signing statement, the President asserted that these and several other provisions of the bill impinge on the executive branch's constitutional authority to conduct foreign policy and he therefore viewed them as "advisory" rather than "mandatory." The original House version of the bill ( H.R. 4681 , passed on June 23, 2006) had been seen by many observers as more stringent as it would have made the provision of U.S. aid to the PA more difficult even if Hamas relinquishes power. In March 2007, Representative Ileana Ros-Lehtinen introduced H.R. 1856 , the Palestinian Anti-Terrorism Act Amendments of 2007, which would amend the original Act to further restrict contact with and assistance to the PA.

The new Palestinian unity government established in March 2007 complicates U.S. policy toward the Palestinian Authority (PA) and the peace process. When Hamas took power last year, the Bush Administration, along with its Quartet partners and Israel, responded by cutting off contact with and halting assistance to the PA. The Administration sought to isolate and remove Hamas while supporting moderates in Fatah, led by President Mahmud Abbas. The international sanctions have not driven Hamas from power, and instead, some assert they may have provided an opening for Iran to increase its influence among Palestinians by filling the void. Now that Hamas and Fatah are sharing power, it will be harder to isolate Hamas. The United States and European countries have held meetings with non-Hamas members of the new government, while Israel continues to rule out all contact with PA ministers. Arab states, led by Saudi Arabia, are pressing for recognition of the new government and an end to the international boycott. Some observers believe Saudi efforts to gain acceptance of the unity government and restart Israeli-Palestinian peace talks may be an effort to set the price for Saudi cooperation on other U.S. policies in the region. In 2006, Congress passed P.L. 109-446 , the Palestinian Anti-Terrorism Act of 2006, to tighten existing restrictions on aid to the Palestinians. In 2007, Representative Ileana Ros-Lehtinen introduced H.R. 1856 , which would amend the original Act to further restrict contact with and assistance to the PA. This report will be updated as events warrant.

Trips by the President, Vice President, and First Lady are almost always classified as official travel or political travel, or a combination of the two. Official, or nonpolitical, travel is normally defined as anything having to do with the carrying out of presidential duties and responsibilities. Official travel may involve, for example, presenting information; giving direction; and explaining, and securing public support for, Administration policies. Political travel normally involves the President and Vice President in their positions as leaders of their political party. Attending party functions, participating in fundraising, and campaigning for candidates are examples of political activities. The terms are rather general, and the White House determines whether a trip is for official or political purposes, or for a combination of the two. The travel policies of specific Administrations concerning the reimbursement of expenses for unofficial travel generally are not publicly available. However, the Reagan Administration established written guidelines in 1982 to determine when the President, Vice President, and any assistants accompanying them on military aircraft travel at government expense and when they, or the political organizations on whose behalf they travel, are to reimburse the government with the equivalent of the airfare that they would have had to pay had they traveled on commercial airlines. The guidelines evolved in response to general legal principles that federal funds are to be used only for the purposes for which they are appropriated, opinions from the Office of Legal Counsel in the Department of Justice, rules of the Federal Election Commission (FEC), and occasional audits by the General Accounting Office (GAO). The guidelines, which also cover the First Lady and the Vice President's spouse, apply only to trips in the United States and its territories, since all foreign travel is considered official. It appears likely that subsequent Administrations have used the Reagan Administration guidelines as a foundation for their own travel policies. When White House personnel are on official travel, certain personal expenses, which include per diem (food and lodging), car rentals, and other incidentals, are paid by the government. These expenses are paid by the White House for domestic travel, and by the State Department for foreign travel. Members of the President's staff and his immediate family, including the First Lady, are on official travel whenever their trips are designed to assist the President in discharging his duties and responsibilities. The same is true for members of the Vice President's staff and his immediate family. According to the Office of the Vice President, the Vice President's wife uses a military aircraft only when she accompanies him, or when she is designated as the Vice President's representative to attend a special function. When travel is for political purposes, the President, Vice President, and First Lady, and any assistants accompanying them, are required to reimburse the government the comparable airfare they would have paid had they traveled by commercial airline. On such trips, they pay for their own food, lodging, and other incidental expenses. Certain staff accompanying them, however, such as Secret Service agents, are always considered to be on official travel, and all their travel costs are paid by the government. When travel involves both official and political functions, the White House uses a formula to determine how much airfare is to be paid by the traveler, and how any per diem and other travel-related costs are to be paid by the government. For example, if the day is divided equally between an official and an unofficial event, then the President, Vice President, First Lady, and accompanying staff, or a political organization, must reimburse the government for 50% of the amount that would have been owed to the government if the entire trip had been political. A more detailed explanation is as follows: In the instance of a mixed trip, the amount of the reimbursement for use of government aircraft will be prorated as indicated by the nature of the activity. Prorating the cost of air travel on mixed official/political trips may be accomplished through a formula based on the amount of time actually spent by the President and Vice President in meetings, receptions, rallies and similar activity. Time spent in actual travel, private study, or rest and recreation will not be included in the computation. The formula is as follows: Time spent in official meetings, receptions, etc. + Time spent in political meetings, receptions, rallies = Total activity time. Time spent in official activity ÷ Total activity time = Percentage of trip that is official. Time spent in political activity ÷ Total activity time = Percentage of trip that is political. The percentage figure that represents the political portion of the trip is then multiplied by the amount that would be reimbursed to the government if all of the travel was political. The product of that calculation represents the amount to be reimbursed to the government. Other factors may result in adjustments to any amount of reimbursement. For example, if a traveling party would have returned to the point of departure on a given day, but delayed its return one day (or more) because of a political activity, then the cost of accommodations is to be assessed solely to the political sponsor. Sometimes it is difficult to determine whether a trip, or part of a trip, should be characterized as official or unofficial. This is especially the case when a trip involves certain activities having partisan consequences, because an inherent part of the official duties of the President and Vice President involves their efforts to present, explain, and secure public support for their policies and goals. When they travel and appear in public to defend their policy positions, the difference between their official duties and their activities as leaders of their political party can be difficult to assess. As a result, the White House decides the nature of travel on a case-by-case basis, attempting to determine whether each trip, or part of a trip, is or is not official by considering the nature of the event involved, and the role of the individual involved. It is unclear how the White House designates travel that is not directly related to a governmental or political function, because of traditional reluctance to address this matter. It appears that, in most cases, such travel is treated as official, under the assumption that the President and Vice President are always on duty. Vacation trips, for example, fall under the official travel category. Security considerations and the need to be able to communicate instantly with military and other officials at any time are the reasons the President flies on a military aircraft when he travels. Moreover, having a military plane readily available enables the President to fly whenever and wherever he may wish to go. Security considerations are also the primary reason for use of military aircraft by the Vice President and First Lady. Airfare and related travel expenses associated with the trips taken by the President, Vice President, and First Lady are only a fraction of the total cost of such trips. Most of the costs involve operational costs of the aircraft, and include fuel, maintenance, engineering support, and per diem expenses for the crew. The military aircraft used by the White House are operated by the 89 th Airlift Wing (AW) located at Andrews Air Force Base in Maryland, just outside Washington, DC. Among the aircraft in the 89 AW are two Boeing 747s (also known as VC-25As) that have been specially configured for the President's needs, and that are exclusively for his use. Electronic and communications equipment in the 747s enables the President to keep in touch at all times with civilian and military officials. The President flies on one of the 747s on most of his trips. Occasionally, he will use a smaller plane when the area he is visiting cannot accommodate a 747. "Air Force One" is the designation given to whatever plane the President is using at the time. Information provided by the U.S. Air Force in 2012 shows that the cost per hour for the President's 747 (which is designated "VC-25" by the Air Force) is $179,750. The Vice President and First Lady use aircraft different from the presidential 747. The Vice President primarily flies on a C-32; the First Lady primarily flies on a C-40 (the C-32 is an alternate). Costs associated with these trips, however, generally involve much more than the operational costs of the specific passenger aircraft. When the President travels abroad, several passenger and cargo aircraft accompany Air Force One. When the Vice President or First Lady make such a trip, a single cargo aircraft accompanies either of them. On domestic trips, a cargo aircraft and a backup aircraft normally accompany only Air Force One. If the President is accompanied by more than 75 assistants and subordinates, including Secret Service staff, an additional passenger aircraft also makes the trip. Sometimes, an additional aircraft accompanies Air Force One to be available to take the President to a second city whose airport cannot accommodate a 747. Finally, in preparation for a trip, whether domestic or foreign, an advance party may make several trips to the destination or destinations that will be visited in order to assure that everything goes as planned. Besides the maintenance and operational costs of the aircraft, there are the per diem and related costs mentioned earlier, when the trip is official, and the costs for those designated "official travelers" when the trip is not official. On a presidential trip, the number of these "official travelers" may be quite high, since it includes Secret Service agents, communications personnel, and various other officials. Only recently has information become available regarding the overall cost associated with travel by the President, Vice President, and First Lady. In 1992, the House Committee on Post Office and Civil Service estimated that two presidential trips, one to Europe in 1989 and the other to Hawaii in 1990, cost the Air Force $1 million to $1.5 million, and that the average vice presidential trip cost the Air Force $250,000 to $500,000. These estimates involved operational costs; they did not include per diem and other travel-related expenses. In 1999, GAO estimated the incremental costs, including per diem and related expenses, of presidential trips in 1998 to Africa, Chile, and China to be at least $42.8 million, $10.5 million, and $18.8 million respectively. In 2000, GAO estimated that the Department of Defense "spent at least $292 million to provide fixed-wing airlift and air refueling support for 159 White House foreign trips" (27 by the President, 20 by the First Lady, 8 by the Vice President, and 104 directed by the President) from January 1, 1997, through March 31, 2000. These estimates did not include per diem and other travel-related expenses. Comparable information is not available regarding the cost of White House foreign (or domestic) trips for earlier or subsequent Administrations.

For security and other reasons, the President, Vice President, and First Lady use military aircraft when they travel. The White House generally categorizes the trips as fulfilling either official or political functions. Often, a trip involves both official and political, or unofficial, activities. When a trip is for an official function, the government pays all costs, including per diem (food and lodging), car rentals, and other incidental expenses. When a trip is for political or unofficial purposes, those involved must pay for their own food and lodging and other related expenses, and they must also reimburse the government with the equivalent of the airfare that they would have paid had they used a commercial airline. When a trip involves both official and political activities, a formula determines the amount to be reimbursed for that part of the trip involving political activities. Whether a trip is for official or political purposes, the Air Force pays all operational and other costs incurred by the use of the aircraft. While the travel policies of specific Administrations concerning the reimbursement of expenses for unofficial travel generally are not publicly available, it appears that policy guidelines developed by the Reagan White House have served as a basis for the travel policies of subsequent Administrations. This report will be updated as new information becomes available.

Federal debt represents, in large measure, the accumulated balance of federal borrowing of the U.S. government. The portion of gross federal debt held by the public consists primarily of investment in marketable U.S. Treasury securities. Investors in the United States and abroad include official institutions, such as the U.S. Federal Reserve; financial institutions, such as public banks; and private individual investors. Table 1 provides December 2015 data, available as of March 2016, on estimated ownership of U.S. Treasury securities by type of investment and the percentage of that investment attributable to foreign investors. The table shows that from December 2011 to December 2015, foreign holdings of debt increased by $1.1 trillion to approximately $6.1 trillion. During the same period, total publicly held debt increased by approximately $3.5 trillion to $15.1 trillion. Because the total debt has increased at about the same pace as the debt held by foreigners, the share of federal debt held by foreigners has been relatively steady. In December 2015, foreigners held 40% of the publicly held debt. Interest on the debt paid to foreigners in 2015 was $94.9 billion. Although 2015 was the first time in the past 10 years that foreign holdings declined, it is too soon to say whether this is a turning point in the heretofore upward trend. Data on major foreign holders of federal debt by country are provided in Table 2 . According to the data, the top three estimated foreign holders of federal debt by country, ranked in descending order as of December 2015, are China ($1,246.1 billion), Japan ($1,122.6 billion), and Caribbean Banking Centers ($351.7 billion). Based on these estimates, China holds approximately 20.3% of all foreign investment in U.S. privately held federal debt; Japan holds approximately 18.3%; and Caribbean Banking Centers holds approximately 5.7%. Foreign holdings as estimated by the Treasury Department can be divided into official (governmental investment) and private sources. Figure 1 provides data on the current breakdown of estimated foreign holdings in U.S. federal debt. As the figure shows, 66.6% ($4,094.6 billion) of foreign holdings in U.S. federal debt are held by governmental sources. Private investors hold the other 33.4% ($2,053.5 billion). After increasing for several years, overall foreign holdings have been relatively flat since 2013. From an economic perspective, foreign holdings of federal debt can be viewed in the broader context of U.S. savings, investment, and borrowing from abroad. For decades, the United States has saved less than it invests. Domestic saving is composed of saving by U.S. households, businesses, and governments; by accounting identity, when government runs budget deficits, it reduces domestic saving. By the same accounting identity, the shortfall between U.S. saving and physical investment is met by borrowing from abroad. When the deficit rises (i.e., public saving falls), U.S. investment must fall (referred to as the deficit "crowding out" investment) or borrowing from abroad must rise. If capital were fully mobile and unlimited, a larger deficit would be fully matched by greater borrowing from abroad, and there would be no crowding out of domestic investment. To be a net borrower from abroad, the United States must run a trade deficit (it must buy more imports from foreigners than it sells in exports to foreigners). Since 2000, U.S. borrowing from abroad and the trade deficit each have exceeded $300 billion each year. Borrowing from abroad peaked at $800 billion in 2006 and was $484 billion in 2015. Borrowing from abroad has occurred through foreign purchases of both U.S. government and U.S. private securities and other assets. As a result of foreign purchases of Treasury securities, the federal government must send U.S. income abroad to foreigners. If the overall economy is larger as a result of federal borrowing (because the borrowing stimulated economic recovery or was used to productively add to the U.S. capital stock, for example), then this outcome may leave the United States better off overall on net despite the transfer of income abroad. In other words, without foreign borrowing, U.S. income would be lower than it currently is net of foreign interest payments in this scenario. From 2008 to 2014, the output gap (the difference between actual gross domestic product [GDP] and potential GDP) was large, meaning the economy had significant idle capital and labor resources. In the presence of a large output gap, government budget deficits have a greater potential than usual to stimulate the economy and increase total income. As the economy gets closer to full employment, the scope for deficits to stimulate the economy diminishes. Because the federal government has run deficits almost every year since the 1960s, the mainstream economic view is that these budget deficits have not led to a larger economy on net over the long run for two reasons. First, the government has run deficits in many years when the economy was near or at full employment, precluding the role of deficit stimulus. Second, federal spending on capital is small relative to the overall budget. It can be argued that the underlying long-term economic problem is the budget deficit itself, and not that the deficit is financed in part by foreigners. This can be illustrated by the counterfactual—assume the same budget deficits and U.S. saving rates without the possibility of foreign borrowing. In this case, budget deficits would have had a much greater "crowding out" effect on U.S. private investment, because only domestic saving would have been available to finance both. The pressures the deficit has placed on domestic saving would have pushed up interest rates throughout the economy and caused fewer private investment projects to be profitably undertaken. With fewer private investment projects, overall GDP would have been lower over time relative to what it would have been. The ability to borrow from foreigners avoids the deleterious effects on U.S. interest rates, private investment, and GDP, to an extent, even if it means that the returns on some of this investment now flow to foreigners instead of Americans. In other words, all else equal, foreign purchases of Treasury securities reduce the federal government's borrowing costs and reduce the costs the deficit imposes on the broader economy. The burden of a foreign-financed deficit is borne by exporters and import-competing businesses, because borrowing from abroad necessitates a trade deficit. It is also borne by future generations, because future interest payments will require income transfers to foreigners. To the extent that the deficit crowds out private investment rather than is financed through foreign borrowing, its burden is also borne by future generations through an otherwise smaller GDP. Because interest rates are at historically low levels, this burden has not grown significantly given the increase in borrowing. Were rates to rise, however, the burden would rise with some lag as new borrowing was made at the new higher rates and old borrowing matured and "rolled over" into new debt instruments with higher rates. Thus far, this report has considered the impact of the government's budget deficit and the low U.S. saving rate on U.S. Treasury yields, but not investor demand. Since interest rates fell to historic lows at a time when the supply of Treasury securities rose to historic heights, it follows that Treasury rates have been driven mainly by increased investor demand in recent years. In the wake of the 2008 financial crisis, investor demand for Treasury securities increased as investors undertook a "flight to safety." Treasury securities are perceived as a "safe haven" compared with other assets because of low perceived default risk and greater liquidity (i.e., the ability to sell quickly and at low cost) than virtually any alternative asset. For foreign investors, their behavior also implies that they view the risk from exchange rate changes of holding dollar-denominated assets to be lower than alternative assets denominated in other currencies. The reasons for this flight to safety are varied. For example, investors who had previously held more risky assets may now be more averse to risk and are seeking to minimize their loss exposure; investors may not currently see profitable private investment opportunities and are holding their wealth in Treasury securities as a "store of value" until those opportunities arise; or investors may now need Treasury securities to post as collateral for certain types of transactions (such as repurchase agreements) where previously other types of collateral could be used (or used at low cost). Flight-to-safety considerations are likely to subside if economic conditions continue to normalize, reducing the incentive for foreigners to buy Treasuries and raising their yields, all else equal. More normal economic conditions would also be expected to increase domestic investment demand, which would either push up domestic interest rates or lead to more foreign borrowing. Recently, relatively stronger economic growth in the United States compared with other advanced economies has led U.S. interest rates to begin to rise relative to foreign rates. This relative movement in rates could attract additional foreign capital inflows. Finally, any discussion of foreign holdings of Treasuries would be incomplete without a discussion of the large holdings of foreign governments (referred to as "foreign official holdings" in Figure 1 ). Foreign official holdings are motivated primarily by a desire for a liquid and stable store of value for foreign reserves; relatively few assets besides U.S. Treasury securities fill this role well. Depending on the country, foreign reserves may be accumulated as a result of a country's exchange rate policy, the desire to reinvest export proceeds, or the desire to build a "war chest" to fend off speculation against the country's exchange rate and securities. If motivated by any of these factors, rate of return may be a lesser consideration for foreign governments than it is for a private investor. Although large, foreign official holdings have not been significantly increasing since 2013, after more than a decade of rapid growth before then. Since 1986, the United States has had a net foreign debt, and that debt grew to $7 trillion in 2014. The growth in net foreign debt is unsustainable in the long run, meaning that it cannot continuously grow faster than GDP, as it has generally done in recent decades. This net foreign debt has not imposed any burden on Americans thus far, however, because the United States has consistently earned more income on its foreign assets than it has paid on its foreign debt, even though foreigners owned more U.S. assets than Americans owned foreign assets. Although it is likely that the United States would begin to make net debt payments to foreigners at some point if the net foreign debt were to continue to grow, it has not been a cause for concern yet. To date, the primary drawback is the risk that its unsustainable growth poses, albeit slight in the short run. Unsustainable growth in the net foreign debt could lead to foreigners at some point reevaluating and reducing their U.S. asset holdings. If this happened suddenly, it could lead to financial instability and a sharp decline in the value of the dollar. Alternatively, were the growth in the debt to decline gradually, it is unlikely to be destabilizing. A related concern is whether the major role of foreigners in Treasury markets adds more risk to financial stability. In other words, would financial stability be less at risk if the United States borrowed the same amount from foreigners, but foreigners invested exclusively in private securities instead of U.S. Treasury securities? Empirical evidence does not shed much light on this question, although the fact that some foreign crisis countries, such as Ireland, had accumulated mainly private, not government, debt might suggest that avoiding foreign ownership of government debt is not a panacea. Although countries like Greece with large foreign holdings of government debt have experienced financing problems, a large share of Italy's large government debt was held domestically, and it has nevertheless faced financing problems. The major role of foreign governments as holders of U.S. Treasuries could reduce financial instability if foreign governments are less motivated by rate of return concerns because that implies they would be less likely to sell their holdings if prices started to fall. Finally, foreign official holdings of U.S. debt may have foreign policy (as opposed to economic) implications that are beyond the scope of this report. What policy options exist if policymakers decided foreign ownership of federal debt was undesirable? Absent strict capital controls, it is unlikely that foreigners could effectively be prevented from buying Treasury securities. After Treasury securities are initially auctioned by Treasury, they are traded on diffused and international secondary markets, and turnover is much higher on secondary markets than initial auctions. A foreign ban on secondary markets would be hard to enforce because secondary market activity could shift overseas, and even if it could be enforced, the U.S. saving-investment imbalance would likely shift foreign investment into other U.S. securities—perhaps even newly created financial products that allowed foreigners to indirectly invest in Treasury securities. Thus, a ban would not address the underlying economic factors driving foreign purchases. Economically, the only way government could reduce its reliance on foreign borrowing is by raising the U.S. saving rate, which could be done most directly by reducing budget deficits.

This report presents current data on estimated ownership of U.S. Treasury securities and major holders of federal debt by country. Federal debt represents the accumulated balance of borrowing by the federal government. To finance federal borrowing, U.S. Treasury securities are sold to investors. Treasury securities may be purchased directly from the Treasury or on the secondary market by individual private investors, financial institutions in the United States or overseas, and foreign, state, or local governments. Foreign investors have held slightly less than half of the publicly held federal debt in recent years, prompting questions on the location of the foreign holders and how much debt they hold. This report will be updated annually or as events warrant.

Economic conditions in China are of considerable concern to U.S. policymakers, given the potential impact of China's economy on the global and U.S. economy. The recent large inflow of financial capital into China, commonly referred to as "hot money," has led some economists to warn that such flows may have a destabilizing effect on China's economy. In an op-ed column in the Financial Times , two China experts wrote of hot money's "ensuing money creation is fueling rising inflation, systemic overinvestment, and an overextended banking system." There are also indications that "hot money" flows have played a role in the recent rise and fall of China's stock and real estate markets. Other economists have expressed concerns that efforts by the Chinese government to control "hot money" inflows could have significant negative consequences for the U.S. and global economy in the form of slower growth, greater inflation, or both. There is no formal definition of "hot money," but the term is most commonly used in financial markets to refer to the flow of funds (or capital) from one country to another in order to earn a short-term profit on interest rate differences and/or anticipated exchange rate shifts. These speculative capital flows are called "hot money" because they can move very quickly in and out of markets, potentially leading to market instability. Many economists maintain that the rapid outflow of "hot money" first from Thailand and then from other Southeast Asian economies was a significant contributing factor to the onset and severity of the East Asian Financial Crisis of 1997. Because "hot money" flows quickly and is poorly monitored, there is no well-defined, direct method for estimating the amount of "hot money" flowing into a country during a period of time. In addition, once an estimate is made, the amount of "hot money" may suddenly rise or fall, depending on the economic conditions driving the flow of funds. One common way of approximating the flow of "hot money" is to subtract a nation's trade surplus (or deficit) and its net flow of foreign direct investment (FDI) from the change in the nation's foreign reserves. For the first half of 2008, China's foreign reserves increased by $280.6 billion. Over the same time period, China's accumulated trade surplus was $99.0 billion and its FDI inflow was $52.0 billion. Using the method described above, China received an inflow of $129.6 billion in "hot money" during the first half of 2008. According to the former director of China's National Bureau of Statistics, Li Deshui, China's research institutes estimate that about $500 billion in "hot money" has accumulated in China. However, Zhang Ming, an economist at the Chinese Academy of Social Sciences, reportedly estimated that $1.75 trillion in "hot money" could have accumulated over the last five years. Some Chinese experts reportedly predict that the amount of "hot money" in China will rise to $650 billion by the end of 2008. Some western analysts think the Chinese figures underestimate the amount of "hot money" in China because they do not take into account changes in China's monetary policies, such as the raising of reserve requirements and the creation of China's sovereign wealth fund, the China Investment Corporation. Taking into account these other factors, U.S. financial analyst Brad Setser estimates that China received over $400 billion in "hot money" flows between April 2007 and March 2008. While there may be some uncertainty about the precise amount of "hot money" flowing into China, there appears to be a general agreement as to why speculators are moving their capital into China. Analysts point to two key factors: (1) the relative interest rates in China and the United States; and (2) expectations of the future appreciation in the value of China's currency, the renminbi (RMB). Over the last year, interest rates in China and the United States have been moving in opposite directions. The U.S. Federal Reserve lowered the federal funds rate nine times over the last year from a high of 5.25% in June 2007 to its current low of 2.00%. Over the same time period, the People's Bank of China raised its benchmark one-year interest rate on deposits from 2.52% to 4.14%. The reversal in the relative interest rates of the two nations has created an incentive for investors to move their deposits from the United States to China in order to earn a higher rate of return. In addition to the attraction of the interest rate difference, speculators are moving "hot money" into China because of the general expectation that the RMB will continue appreciate in value against the U.S. dollar and other currencies. On July 21, 2005, China announced it was dropping its fixed exchange rate policy for a "managed float" policy that would allow the value of the RMB to fluctuate within a specified range on a daily basis. Since then, through July 15, 2008, the RMB has appreciated in value by 21.6%. Most analysts expect the Chinese government to continue the RMB's appreciation. The combined effects of the interest rate differences and the expected appreciation of the RMB provide a strong incentive for "hot money" flows into China. Li Yang, a financial researcher at China's Academy for Social Sciences calculated that "hot money" speculators can obtain profit rates of over 10% per year with little investment risk. In theory, despite its recent capital market liberalizations, China still maintains some restrictions over foreign exchange and international capital flows, providing it with various instruments to prevent the inflow of the unwanted "hot money." However, sources report that speculators are using various methods to circumvent Chinese laws and regulations. According to a Deutsche Bank survey of 200 companies and 60 "high income" individuals, over half of the "hot money" coming into China is being done in the form of over-reported or false foreign direct investment (FDI). An additional 11% of the "hot money" is generated by underreporting the value of imports, and another 10% comes from the overvaluing exports. The Deutsche Bank study also reported that 5% of the "hot money" enters China via "underground money exchangers" ( dixia qianzhuang ). Employee compensation (wages sent to China by overseas workers and remuneration paid by Chinese enterprises to overseas staff working in China) and current transfers (emigrant remittances, gifts, and donations) may be another major source of hot money. According to some analysts, U.S. economic policies (and the slow U.S. economy) may be exacerbating China's "hot money" problem, creating a "Catch-22" situation for Beijing. Years of large federal deficits and comparatively low U.S. interest rates have contributed to the weakening of the U.S. dollar against many currencies (including the RMB) and the outflow of "hot money" from the United States. One Chinese official indicated that he thought the U.S. subprime crisis was also fueling "hot money" flows. The main concern in China over the influx of "hot money" has been that it may add to China's inflationary pressures. In July 2008, the government reported that the consumer price index had risen by 7.9% over the first half of 2008 over the same period in 2007 (due largely to food prices), which was much higher than the government's target ceiling of 4.8%, and the producer price index rose by 7.6%. High inflation is a serious issue for the government because of concerns that rapid inflation could produce protests and political instability. At the same time, the government needs rapid growth to help employ the 27 million new job seekers each year. Under Chinese law, most foreign exchange entering the country must be converted into RMB. The large flow of "hot money" is causing a sharp rise in China's money supply, resulting in inflation. The Chinese government has attempted to "sterilize" the foreign exchange by selling bonds to "soak up" the RMB put into circulation, but this has resulted in higher interest rates that attract even more "hot money." China has attempted to nullify the inflationary impact of "hot money" by other means, such as the imposition of lending quotas on banks, increasing the ratio of reserves commercial banks are required to maintain (it was raised to 17.5% in June 2008 compared to 9.0% in January 2007), raising interest rates, instituting government controls to limit investment in overheated sectors (such as real estate and the steel industry), and imposing price controls on certain products (mainly food and energy). A big concern by some Chinese analysts is that "hot money" may be creating bubbles in its stock and real estate markets, although recent evidence suggests that the "hot money" is being largely deposited into bank accounts. If the Chinese government determines it is necessary to take action, it has a number of options on how to slow down the flow of "hot money." However, each option has potentially negative side effects. An increase in the value of the RMB would arguably be an effective option for controlling inflationary pressures caused by "hot money." A sharp appreciation in the RMB vis-à-vis the dollar—either by a sharp revaluation or quickening the pace of appreciation under its "managed float" regime—would eliminate one of the two main incentives driving the speculators. The move would probably lower the price of imports (including raw materials) and possibly slow the growth in foreign exchange reserves. Other analysts have suggested that China depreciate the RMB, a move that would undermine the speculators, but could prompt Congress to pass currency legislation (including sanctions) against China. Some Chinese officials contend that although a stronger RMB might reduce inflationary pressures, it would also likely raise the price of China's exports and diminish China's attractiveness as a destination for FDI, leading to widespread layoffs, factory closings, and slower economic growth. While export growth over the first six months of 2008 has been strong (up 22% over the same period in 2007), there is concern that rising costs in China and economic weakness in the United States could greatly slow China's export growth and reduce the domestic value of its foreign exchange reserves. Another option for slowing the inflow of "hot money" is to tighten restrictions on the flow of foreign capital into China, a trend contrary to recent U.S. efforts to persuade China to liberalize its financial markets. During his first speech as Vice Premier on May 9, 2008, Wang Qishan spoke of "reinforcing supervision over cross-country capital flow." There have also been reports that China is tightening its supervision of bank accounts held by non-residents to curb the influx of "hot money." In addition, China could attempt to further promote the outflow of capital to reduce the inflationary impact of "hot money," using some of its foreign exchange reserves. However, many policymakers, including those in the United States, are concerned over the potential impact of wide-scale (and potentially government directed) Chinese investment in "strategic" economic sectors (such as oil and gas, high technology, etc.). Some U.S. analysts contend that the large levels of "hot money" pouring into China will force China to accelerate the appreciation of the RMB relative to the U.S. dollar and make the government enact other reforms to make the currency more flexible. This, they maintain, could in the short run help boost U.S. exports to China and reduce imports from China, thus improving the U.S. bilateral trade balance with China. Others warn that appreciating the RMB would also make U.S. imports from China more expensive, which could add to inflationary pressures in the United States. In addition, China might reduce its purchases of U.S. Treasury securities (used to help fund the federal deficit), which could push up U.S. interest rates. Another concern is that Chinese efforts to fight hot money/inflation could lead to a slowdown in China's economic growth. This could have numerous implications for the U.S. and global economies. Over the past few years, China has been one of the fastest growing economies, which has made it a major market for U.S. exports. In 2007, China surpassed Japan to become the 3 rd largest U.S. export market, and thus a Chinese slowdown could reduce its demand for U.S. goods and services. Additionally, inflationary problems or an economic slowdown could cause Chinese officials to delay economic reforms, particularly to its financial system and currency policy. The issues concerning the potential dangers of "hot money" flows to China reinforces the U.S. argument (and has been acknowledged by the Chinese government as a long term goal), that China needs to do more to implement policies to encourage domestic demand and lessen its dependence on exporting and fixed investment for its economic growth. Some U.S. analysts contend that adopting a free floating exchange rate is the best way to stop hot money inflows and to provide the government with the monetary tools it needs to control inflation. However, Chinese officials contend that such a move at this time would shock the economy, especially the export sector, and thus would be too risky (although they contend that a fully convertible currency is a long range goal). The "hot money" issue is a further indicator of the growing economic integration between the United States and China.

China has experienced a sharp rise in the inflow of so-called "hot money," foreign capital entering the country supposedly seeking short-term profits, especially in 2008. Chinese estimates of the amount of "hot money" in China vary from $500 billion to $1.75 trillion. The influx of "hot money" is contributing to China's already existing problems with inflation. Efforts to reduce the inflationary effects of "hot money" may accelerate the inflow, while actions to reduce the inflow of "hot money" may threaten China's economic growth, as well as have negative consequences for the U.S. and global economy. This report will be updated as circumstances warrant.

The Every Student Succeeds Act (ESSA), signed into law on December 10, 2015 ( P.L. 114-95 ), comprehensively reauthorized the Elementary and Secondary Education Act of 1965 (ESEA). Among other changes, the ESSA amended federal K-12 educational accountability requirements for states and local educational agencies (LEAs) receiving ESEA funds, including those regarding the identification, support, and improvement of high schools with low graduation rates. Under the ESSA, states seeking Title I-A funds are required to submit accountability plans to the Department of Education (ED) that must address, among other things, their approaches toward dealing with low high school graduation rates. In implementing these plans, states must identify for support and improvement all public schools failing to graduate one-third or more of their students. LEAs that serve schools identified for support and improvement are required to develop a plan to improve graduation rates. If a school does not improve within a state-determined number of years, the school is subject to more rigorous state-determined actions. The national graduation rate for the Class of 2016 was 84.1%—the highest rate recorded since 2010-2011, when most states and LEAs began consistently reporting under 2008 federal guidelines. Improvement in the national rate has been accompanied by improvements in nearly every state and across all reported groups of students, including all racial and ethnic subgroups, low-income students, English learners, and students with disabilities. However, graduation rate gaps persist among the several student subgroups. Moreover, the graduation rate varies enormously among individual high schools across the country, with a large number of schools doing poorly on this measure. Importantly for ESSA accountability implementation, CRS analysis of school-level data reveals that as many as 16% of high schools may fail to graduate at least one-third of their students. Thus, there are potentially thousands of high schools nationwide that may be identified for intervention in the coming years. Implementation of the accountability rule occurs in school year 2017-2018 and relies on additional criteria that would undoubtedly impact this estimate. In addition to new accountability rules, the ESSA provided the first definition of the high school graduation rate in federal education law. This was the culmination of years of effort at the national, state, and local levels to achieve national uniformity of measurement and establish statewide longitudinal data systems. Put simply, the ESSA defines the Four-Year Adjusted Cohort Graduation Rate (ACGR) as the number of students who graduate in four years with a regular high school diploma divided by the number of students who form the adjusted cohort for the graduating class. From the beginning of 9 th grade, students entering that grade for the first time form a cohort that is adjusted by adding students who subsequently transfer into the cohort and subtracting students who subsequently transfer out, emigrate to another country, or die. The following formula provides an example of how the ACGR is calculated for the class of 2016: As Figure 1 shows, the rate of high school completion in the United States increased dramatically after World War II. The rate displayed in this figure is not the ACGR; rather, it represents the number of persons ages 25 to 29 whose highest level of educational attainment was at least a high school diploma (or its equivalent). It is based on responses to the Current Population Survey (CPS). After 10-15 percentage-point increases every decade, this measure plateaued at about 85% in 1980 and stood at 92.5% in 2017. Although the overall rate of high school completion has reached an historically high level, inequities persist among racial and ethnic groups. In general, these groups have made progress similar to the overall trend with one exception: Hispanics have seen a rapid increase in high school completion in recent years. Even with this increase, the attainment gap between white, non-Hispanics and Hispanics remains wide—13 percentage points in 2017. Black attainment also continues to lag behind that of Asians and non-Hispanic whites—maintaining a roughly five percentage point gap below the latter since the early 1990s. The CPS educational attainment rate is presented here (in Figure 1 ) because it is useful for tracking long-term trends. It is important to note the differences between the ACGR and the CPS educational attainment rate. The CPS is a cross-sectional measure (i.e., taken at a single point in time) of those included in the survey sample. The ACGR is a longitudinal measure that tracks an entire cohort of students from entry into high school to graduation. Another distinction between the two measures is that the CPS includes diploma equivalencies (such as the General Educational Development (GED) test) in its rate, while the ACGR only includes "regular" diplomas. The inclusion of equivalencies may partly explain why the CPS rate is higher than the ACGR. Additionally, the CPS rate shown in Figure 1 is for people ages 25 to 29—giving them more time to complete high school or receive a GED compared to the four years allotted to cohorts in the ACGR. More broadly, while the ACGR is confined to those engaged in the school system, the CPS captures a wider population of persons in society, generally. Even with these differences, the overall ACGR collected since 2010-2011 shows similar trends. As Table 1 shows, the overall graduation rate increased five percentage points between 2011 and 2016—a rate similar to the three percentage point increase in the overall CPS educational attainment rate estimate for the same time period. The two high school completion measures show somewhat different trends among racial/ethnic groups. In the CPS data, the white, non-Hispanic rate increased less than 1% between 2011 and 2016, while it increased over 4% in the ACGR data. During the same period, the CPS rate for blacks increased less than 3%, while the ACGR for blacks increased over 9%. The CPS rate grew just over 1% for Asians while the ACGR grew almost 4%. Both measures had similar changes for Hispanics. Because the ESSA accountability requirements apply to both the total student body within schools as well as specified subgroups, states must report the ACGR for several subgroups including low-income students, English language learners, students with disabilities, and various racial/ethnic categories. The data spanning 2011-2016 indicate progress among all three of these subgroups: graduation rates among low-income students increased more than seven percentage points, English language learners increased nearly ten percentage points, and students with disabilities increased six and a half percentage points. The rate of on-time high school completion varies widely across the country. For the Class of 2016, the ACGR in 27 states was above the national average (84.1%) and below the national average in 23 states. New Mexico had the lowest ACGR (71%) and Iowa had the highest (91.3%). Figure 2 displays the ACGR for the Class of 2016 by state. Four states graduated fewer than 76.1% of their students, nineteen states graduated 76.2%-84.1%, seventeen states graduated 84.1%-87.7%, and ten states graduated 87.8% or more. As shown in Table 2 , graduation rates have increased or remained the same in every state between the graduating classes of 2011 and 2016. The largest increase occurred in Alabama, which saw an increase from 72% (which was below the national average), to 87.1% (which was above the national average). Four states—Alaska, Georgia, Nevada, and West Virginia—had increases of more than ten percentage-points. Three states—Indiana, South Dakota, and Vermont—saw increases of less than one percentage point over this same period. ESSA provisions require that, beginning with the 2017-2018 school year, each state must use the ACGR as an indicator in their accountability systems and in calculating long-term and interim goals. Analysis of school-level data for the Class of 2015 reveals 2,512 high schools—16% of schools nationwide—had an ACGR of less than 70% ( Table 3 ). [Note that, due to privacy protections imposed on publically available data, this analysis uses 70% (instead of 66.7%) as the cutoff for schools to be identified for intervention. These limitations only apply to published data; states would not face such constraints as they have access to the complete data of actual rates reported for every school.] Because this analysis uses 70% instead of 66.7%, it likely overestimates the number of schools that may be identified for intervention due to low graduation rates. This analysis may further overestimate the number of schools that may be identified for intervention because the accountability provisions do not take effect until the 2017-2018 school year and graduation rates have been improving. Even with these caveats, this analysis suggests that there are potentially thousands of high schools that may be identified for improvement due to failure to graduate more than one-third of their students. Whether or not these schools would be uniquely identified for intervention based upon graduation rates (or identified for other reasons as well) is unknown. That is, it is unclear how much overlap may exist among schools identified by graduation rate and those identified for other reasons (i.e., the lowest-performing 5% of Title I schools and those with chronically underperforming subgroups). Nonetheless, the number of schools identified as being in need of comprehensive support for this reason may be large in some states. The Department of Education (ED) collects the Adjusted Cohort Graduation Rate (ACGR) from states through its EDFacts Initiative. These data are made public on ED's website. Disclosure avoidance techniques are applied to comply with privacy protections required by the Family Educational Rights and Privacy Act. These steps result in complete suppression of the ACGR for schools with cohorts of fewer than 6 students, reporting of ACGR ranges for cohorts between 6 and 200 students, and reporting of exact rates for cohorts over 200 students. The widths of the ACGR ranges are determined by cohort size and get progressively wider as a cohort size decreases. The actual ACGR reported by states lies somewhere within the published range. ACGR ranges reported by EDFacts are shown in Table A-1 .

The Every Student Succeeds Act (ESSA) comprehensively reauthorized the Elementary and Secondary Education Act of 1965 (ESEA). Among other changes, the ESSA amended federal K-12 educational accountability requirements for states and local educational agencies (LEAs) receiving ESEA funds, including those regarding the identification, support, and improvement of high schools with low graduation rates. In addition to new accountability rules, the ESSA provided the first definition of the high school graduation rate in federal education law. States and LEAs have been reporting their rates using the same definition, originally laid out in 2008 regulations, since the 2010-2011 school year. The national graduation rate for the Class of 2016 was 84.1%—the highest rate recorded using the new methodology. The graduation rate for the Class of 2011 was 79.0%. This national-level improvement has been accompanied by improvements in nearly every state and across all reported groups of students, including all racial and ethnic subgroups, low-income students, English learners, and students with disabilities. Still, graduation rate gaps persist among several student subgroups. At the state level, 27 states were above the national average in 2016 and 23 were below. Three states graduated fewer than 75% of their students, nine states graduated 75%-79.9%, eleven states graduated 80%-84.9%, seventeen states graduated 85%-87.9%, and ten states graduated 88% or more. Importantly for ESSA accountability implementation, analysis of 2014-2015 school-level data reveals that as many as 16% of high schools may fail to graduate at least one-third of their students. Thus, there are potentially thousands of high schools nationwide that may be identified for intervention in the coming years.

Section 3092 of Title 50, U . S. Code , requires that the congressional intelligence committees be kept "fully and currently informed" of all intelligence activities, other than a covert action, by the Director of National Intelligence (DNI) and the head of any of the component organizations of the intelligence community. Notifications shall be in writing and include the nature of the circumstances and an explanation of their significance. Intelligence Community Directive (ICD) 112, Congressional Notification , specifies that it is the specific component organization that determines which activities are reportable. Some notifications, by their nature, are after the fact, such as a significant intelligence failure "extensive in scope, continuing in nature" impacting U.S. national security. ICD 112 also provides guidance on significant anticipated activities that might qualify as reportable beforehand. They include, for example 1. intelligence activities that entail, with reasonable foreseeability, significant risk of exposure, compromise, and loss of human life; 2. intelligence activities that are expected to have a major impact on important foreign policy or national security interests; or 3. significant activities undertaken pursuant to specific direction of the President or the National Security Council (other than covert action). Typically, intelligence activities that are considered less sensitive are briefed to the membership of each committee in line with statute. In certain circumstances, however, the Section 3092 requirement may be met through notifications to select members of the House and Senate, a group colloquially known as the Gang of Four . Gang of Four intelligence notifications are usually oral briefings provided only to the chairs and ranking members of the two congressional intelligence committees. Gan g of Four notifications are not based in statute or in the rules of either of the two congressional intelligence committees. They are a practice generally accepted by the leadership of the intelligence committees in circumstances when the executive branch believes a non-covert action intelligence activity—often a collection program—to be of such sensitivity that a restricted notification is warranted in order to reduce the risk of disclosure, inadvertent or otherwise. These notifications are provided as briefs without any written record or notetaking. Section 3093 of Title 50, U . S. Code sets out how the congressional intelligence committees are to be informed of covert actions, to include use of cyber capabilities when employed as a covert action. The President may authorize the conduct of a covert action only if he or she determines such an action is "necessary to support identifiable foreign policy objectives of the United States, and is important to the national security of the United States." Such determinations are to be generally set forth in a written finding to be reported to the congressional intelligence committees as soon as possible after the approval of a finding, and before the covert action starts. Findings must be made in writing unless immediate United States action is required. If time constraints prevent the initial preparation of a written finding , a written finding is to be produced as soon as possible but not later than 48 hours after the authorizing decision was made. Findings may not authorize or sanction a covert action, or any aspect of any such action, that already has occurred, and may not authorize any action that would violate the Constitution or any statute of the United States. Findings are to specify each department, agency, or entity of the U.S. government authorized to fund or otherwise participate in any significant way in the activity. They also are to specify whether it is contemplated that any third party not an element of, or a contractor or contract agent of, the U.S. government, or who is not otherwise subject to U.S. government policies and regulations, will be used to fund or otherwise participate in any significant way, or be used to undertake the covert action on behalf of the United States. The DNI and responsible component of the intelligence community must also keep the congressional intelligence committees informed of any significant change to a finding or failure of the covert action. If the President determines that it is "essential" to limit access to a covert action finding in order to "meet extraordinary circumstances affecting vital interests of the United States," he may limit the notification of such a finding to the chairs and ranking minority members of the House and Senate intelligence committees, the Speaker and minority leader of the House of Representatives, and the majority and minority leaders of the Senate. These Members are colloquially known as the Gang of Eight . Whenever such a limited notification is given, the President is further required to "fully inform" the congressional intelligence committees in a "timely fashion" of the relevant finding, and is further required to provide a statement summarizing executive rationale for not providing prior notice of the relevant finding. After 180 days, the President must either provide all Members of the intelligence committees with access to the finding or explain why access must remain limited. Gang of Four and Gang of Eight notifications differ in several ways. A principal difference is that the Gang of Four notifications procedure is not based in statute, and is a more informal process that generally has been accepted by the leadership of the intelligence committees over time. By contrast, the Gang of Eight procedure is provided in statute, and imposes certain statutory obligations on the executive branch. For example, when employing this particular notification procedure, the President must make a determination that vital U.S. interests are at stake if a notification is to be restricted to the Gang of Eight and provide a written statement setting forth the reasons for limiting notification to the Gang of Eight , rather than notifying the full membership of the intelligence committees. Another distinction between the two notification procedures, at least since 1980 when the Gang of Eight procedure was first adopted in statute, is that Gang of Four notifications generally are limited to non-covert action intelligence activities, including principally but not exclusively intelligence collection programs viewed by the intelligence community as being particularly sensitive. In contrast, Gang of Eight notifications are statutorily limited to particularly sensitive covert action programs. Notwithstanding these distinctions, there is no provision in statute that restricts whether and how the chairs and ranking members of the intelligence committees share with committee members information pertaining to the intelligence activities that the executive branch has provided only to the committee leadership, either through Gang of Four or Gang of Eight notifications. Nor, apparently, is there any statutory provision that sets forth any procedures that would govern the access of appropriately cleared committee staff to such classified information. Some critics of restricted intelligence notification of Congress, such as the Gang of Eight procedures, maintain that they do not allow for effective oversight because participating Members "cannot take notes, seek the advice of their counsel, or even discuss the issues raised with their committee colleagues." Other critics contend that restricted notifications such as Gang of Eight and Gang of Four briefings have been "overused." Still others believe Gang of Four notifications are unlawful because they are not statutorily based. Supporters of Gang of Eight notifications assert that such restricted notifications continue to serve their original purpose, which is to protect operational security of particularly sensitive intelligence activities while they are ongoing. Further, they point out that although Members receiving these notifications may be constrained in sharing detailed information about the notifications with other intelligence committee members and staff, these same Members can raise concerns directly with the President and the congressional leadership and thereby seek to have any concerns addressed. Supporters also argue that Members receiving these restricted briefings have at their disposal a number of rarely used legislative remedies if they decide to oppose particular programs, including the capability to use the appropriations process to withhold funding. The four congressional defense committees exercise oversight of sensitive Department of Defense (DOD) activities. These activities, on occasion, may appear similar to clandestine activities or covert action conducted by the intelligence community. However, they differ in that they are conducted under a military chain of command, generally in support of, or in anticipation of a military operation or campaign conducted under Title 10 authority. Insofar as Congress exercises oversight over these activities, DOD's requirements for notifying Congress differ from those of the intelligence community. Greater integration of military and intelligence activities—desired from an operational standpoint—has presented challenges when determining whether they fall primarily under Title 10 or Title 50 authority. Moreover, prior notification, which is generally required for covert action and significant anticipated intelligence activities, is not typical of congressional notifications of sensitive DOD activities conducted in support of a larger military operation. Following are notification requirements for sensitive military activities that, from an operational standpoint, could be confused with covert or clandestine activities of the intelligence community. Traditional military activities are referenced but not defined in statute. They have been described as military activities "under the direction and control of a United States military commander...preceding and related to hostilities which are either anticipated...or ... ongoing, and, where the fact of the U.S. role in the overall operation is apparent or to be acknowledged publicly." Traditional military activities can be conducted covertly (i.e., U.S. sponsorship is secret and unacknowledged) or clandestinely (i.e., the activity itself is secret) in support of the overall military operation. Some have maintained that because these activities can resemble covert action in that they can influence political, military or economic conditions abroad, they warrant greater oversight. In statute, however, traditional military activities and routine support to these activities are exempt from the congressional notification requirements for covert action. Operational Preparation of the Environment (OPE) is defined in DOD doctrine —not in statute—as "activities in likely or potential areas of operations to prepare and shape the operational environment." OPE can be conducted covertly or clandestinely and often involves the employment of U.S. Special Operations Forces (SOF) in counterterrorism operations. Joint Publication 3-05 cites examples of OPE as "close-target reconnaissance…reception, staging, onward movement, and integration…of forces…[and] infrastructure development." Because the military conducts OPE as a category of traditional military activities, these operations are not subject to congressional notification as a covert action or significant anticipated intelligence activity. Congress has been concerned that the military overuses the term OPE resulting in these operations effectively circumventing oversight by the congressional intelligence committees. OPE can also include clandestine intelligence collection, conducted under Title 10 authority, for example, that falls outside the jurisdiction of congressional defense committees, and, as part of a larger military operation, might not be brought to the attention of the congressional intelligence committees. Routine support to traditional military activities might include logistic support to impending or ongoing military operations which involve U.S. Armed Forces unilaterally and in which the U.S. role is generally acknowledged. They can be conducted clandestinely or covertly, however because they have a supporting function to a larger military operation in which the role of the United States is acknowledged, they are not considered covert action and do not require congressional notification separate from the operations they support. Other-than-routine support to traditional military activities includes activities abroad that involve other than unilateral employment of U.S. forces. They may be conducted covertly and clandestinely (i.e., the activity as well as U.S. sponsorship are secret). They include recruitment, training or other assistance to non-U.S. individuals, organizations or populations to conduct activities—wittingly or not—that support U.S. military objectives. Because they may be conducted well in advance of an anticipated military operation and because they can be intended to influence political, economic or military conditions in another country —such as swaying public opinion—other-than-routine support to traditional military activities is subject to congressional notification for covert action under Section 3093, Title 50 of the U. S. Code . Under Title 10, U. S. Code , the Defense Clandestine Service, subordinate to the Defense Intelligence Agency, is designed to provide dedicated clandestine support to DOD to meet unique strategic military intelligence priorities. The Secretary of Defense shall provide to the defense and intelligence committees of the House and Senate quarterly briefings on the deployments and collection activities of personnel of the Defense Clandestine Service. Section 485 of Title 10, U.S. Code requires the Secretary of Defense to provide monthly briefings to the congressional defense committees that describe DOD counterterrorism operations and related activities. Under the statute, each such briefing must include specific elements a global update on activity within each geographic combatant command and how such activity supports the respective theater campaign plan; an overview of authorities and legal issues, including limitations; an overview of interagency activities and initiatives; and any other matters the Secretary considers appropriate. Section 130k of Title 10 of the U . S. Code provides notification requirements for cyber capabilities "intended for use as a weapon" that specifically do not constitute covert action. Section 130k specifies that covert actions are exceptions to these notification requirements. For these operations, the Secretary of Defense must notify the congressional defense committees in writing within 48 hours of the use of a cyber weapon that has been approved for use under international law; on a quarterly basis for any cyber capability developed for use as a weapon; and immediately following the unauthorized disclosure of a cyber weapon capability. Offensive cyberspace operations are defined as operations "intended to project power by the application of force in and through cyberspace." Defensive cyberspace operations are defined as active or passive cyberspace operations "to preserve the ability to utilize friendly cyberspace capabilities and protect data, networks, net-centric capabilities, and other designated systems." Section 484 of Title 10 U . S. Code mandates the Secretary of Defense to provide the congressional defense committees in writing quarterly briefings "on all offensive and significant defensive military operations in cyberspace carried out by the Department of Defense during the immediately preceding quarter." The briefings are to include the command involved and an overview of the legal authorities under which the operations took place. Sensitive Military Operations are defined in Section 130f(d) of Title 10 U. S. Code as (1) kill or capture operations conducted by U.S. Armed Forces outside a declared theater of active armed conflict , or conducted by a foreign partner in coordination with the U.S. Armed Forces that target a specific individual or individuals; or (2) an operation conducted by the U.S. Armed Forces outside a declared theater of active armed conflict in self-defense or in defense of foreign partners, including during a cooperative operation. The Secretary of Defense shall submit notice in writing to the congressional defense committees within 48 hours of the operation (or within 48 hours of providing verbal notice to Congress), to include occasions when DOD provides support to covert actions conducted under Title 50 authority ; immediately following an unauthorized disclosure of an operation; "periodically" in the form of briefs detailing the personnel and equipment assigned. The Secretary of Defense is further required to brief the congressional defense committees periodically on DOD personnel and equipment assigned to sensitive military operations, including DOD support to such operations conducted under Title 50 authorities. Sensitive military cyber operations are a subcategory of sensitive military operations. Section 130j(c) of Title 10 of the U . S. Code defines sensitive military cyber operations as operations carried out by the armed forces of the United States that are intended to cause cyber effects outside a geographic location where the Armed Forces of the United States are involved in hostilities or where hostilities have been declared by the United States. The Secretary of Defense shall provide the congressional defense committees notice within 48 hours of the operation taking place; immediately subsequent to an unauthorized disclosure of a sensitive military cyber operation.

Covert action and clandestine activities of the intelligence community and activities of the military may appear similar, but they involve different notification requirements and usually are conducted under different authorities of the U. S. Code. The requirements for notifying Congress of activities of the intelligence community originated from instances in the 1970s when media disclosure of past intelligence abuses underscored reasons for Congress taking a more active role in oversight. Over time, these requirements were written into statute or became custom. Section 3091 of Title 50, U. S. Code requires the President of the United States to ensure that the congressional intelligence committees are "kept fully and currently informed of the intelligence activities of the United States, including any significant anticipated intelligence activity," significant intelligence failures, illegal intelligence activities, and financial intelligence activities. Intelligence activities also include covert action as outlined under Section 3093(e) of Title 50, U.S. Code. Section 3092 of Title 50, U. S. Code sets out the congressional notification requirements for non-covert action intelligence activities. Section 3093 of Title 50 sets out the congressional notification requirements for covert actions. Both sections 3092 and 3093 explicitly state such notification is to be provided to the "extent consistent with due regard for the protection from unauthorized disclosure of classified information relating to sensitive intelligence sources and methods, or other exceptionally sensitive matters." The President and intelligence committees are responsible for establishing the procedures for notification, which are generally to be done in writing. Partly in deference to this higher standard, such notifications are sometimes limited to specific subgroups of Members of the Senate and the House of Representatives in certain circumstances, as defined by law and custom.

Unmanned vehicles (UVs) are viewed as a key component of U.S. defense transformation. Perhaps uniquely among the military departments, the Department of the Navy (DON), which includes the Navy and Marine Corps, may eventually acquire every major kind of UV, including unmanned air systems (UASs)—which include unmanned aerial vehicles (UAVs) and armed UAVs known as unmanned combat air vehicles, or UCAVs—unmanned surface vehicles (USVs), unmanned underwater vehicles (UUVs) and autonomous underwater vehicles (AUVs), and unmanned ground vehicles (UGVs). Section 220 of the FY2001 defense authorization act ( H.R. 4205 / P.L. 106-398 of October 30, 2000) states, "It shall be a goal of the Armed Forces to achieve the fielding of unmanned, remotely controlled technology such that—(1) by 2010, one-third of the aircraft in the operational deep strike force aircraft fleet are unmanned; and (2) by 2015, one-third of the operational ground combat vehicles are unmanned." A 2005 report by the Naval Studies Board (NSB) recommended that the Navy and Marine Corps should accelerate the introduction of UAVs, and UUVs, UGVs; the report made several additional recommendations concerning DON UV efforts. The Navy Unmanned Combat Air System (N-UCAS) is the Navy's program for acquiring a UAS that can operate from aircraft carriers and penetrate enemy defenses to conduct surveillance and reconnaissance operations or suppress enemy air defenses (SEAD). The Navy plans to demonstrate the aircraft's suitability for carrier-based operations in 2013, and have it enter service in 2021 as a penetrating surveillance and reconnaissance system. The N-UCAS program was initiated as the UCAV-N program in conjunction with the Defense Advanced Research Projects Agency (DARPA). In December 2002, the Department of Defense (DOD) decided to merge the Air Force and Navy UCAV programs into a Joint Unmanned Combat Air System (J-UCAS) program. In October 2005, management of J-UCAS was transferred from DARPA, which had managed it since October 2003, to a joint Air Force-Navy office led by the Air Force. In February 2006, DOD announced that it was restructuring the J-UCAS program into a Navy-oriented UCAV program. The effort became a Navy program once again at the start of FY2007. Details about the J-UCAS program are being defined. The Broad Area Maritime Surveillance UAS (BAMS UAS) is the Navy's program for acquiring an unmanned, persistent, multi-sensor (radar, electro-optical/infrared, and electronic support measures) maritime ISR system that can cover any part of the world. BAMS UAS is to work with the Navy's planned P-8 Multi-Mission Aircraft (or MMA—the Navy's planned successor to the P-3 Orion maritime patrol aircraft). Competitors for BAMS UAS include variants of the existing Global Hawk and Predator UAVs, and possibly an unmanned version of the Gulfstream 550. The Navy's FY2008-FY2013 aircraft procurement plan calls for procuring the first four BAMS UASs in FY2011, and four more each in FY2012 and FY2013. The first BAMSs are expected to enter service in 2013. In support of the BAMS UAS program, the Navy, under the Global Hawk Maritime Demonstration (GHMD) program, has procured two Global Hawks under an Air Force production contract for use as test and demonstration assets in developing a concept of operations and tactics, training, and procedures for persistent ISR. Fire Scout —a small, unmanned helicopter—is the Navy's program for acquiring a Vertical Takeoff and Landing UAV (VTUAV) for use aboard Littoral Combat Ships (LCSs) as an ISR and communications-relay platform. Five Fire Scouts were procured in FY2006 and four were procured in FY2007. The Navy's FY2008-FY2013 aircraft procurement plan calls for procuring three in FY2008, five in FY2009, six each in FY2010 and FY2011, nine in FY2012, and 10 in FY2013. A planned improvement for Fire Scout is the Coastal Battlefield Reconnaissance and Analysis (COBRA) mine countermeasures payload. The Tactical Control System (TCS) , a part of the Fire Scout system, is being evaluated by the Navy as a possible control system for BAMS UAS (see above) and STUAS (see below). The Small Tactical UAS (STUAS) is a Navy-Marine Corps program(with additional Air Force and Special Operations Command [USSOCOM] participation in developing program requirements) initiated in FY2008 to develop a small UAV for persistent ISR operations. For the Navy, STUAS is to support ship and small-unit commanders involved in the Navy's participation in what the Administration refers to as the global war on terrorism (GWOT). The Navy and Marine Corps want to have STUAS enter service in FY2010. The Marine Corps organizes its UAS acquisition efforts into three tiers based on the level of the Marine Corps commander supported. Tier I UASs support small-unit (platoon and company) commanders. The current Tier I UAS is the Dragon Eye . In September 2006, the Marine Corps selected the Raven B —a UAS also operated by the Army and the USSOCOM—as the Marine Corps' follow-on Tier I UAS. The Marine Corps as of November 2006 operated more than 100 Tier I systems. Tier II UASs support battalion, Marine Expeditionary Unit (MEU), regimental, and division commanders. The Marine Corps wants the STUAS (see discussion above) to be its new Tier II system. Between now and STUAS' planned entry into service in FY2010, the Marine Corps is filling its need for Tier II UASs in Iraq through ISR service contracts. Boeing/Insitu is the current contractor; future contracts will be competed. Tier III UASs support Marine Expeditionary Force (MEF) and Joint Task Force (JTF) commanders. The current Tier III UAS is the Pioneer , which entered service with the Navy and Marine Corps in 1986 and is now in sustainment status. The Marine Corps is changing the Pioneers' ground control system (GCS) to a Replacement GCS based on the Army's "One System" GCS, providing a common GCS capability with the Army. The Marine Corps plans to ultimately use the One System GCS across all three UAS tiers. The Vertical UAS (VUAS) is the Marine Corps' planned follow-on Tier III UAS. The Marine Corps is currently developing requirements documentation and conducting an analysis of alternatives (AOA) for the program, and is evaluating options for sustaining its current Tier III capability until VUAS is fielded. The Navy reportedly was to complete a new USV master plan by the end of 2006. The Remote Minehunting System (RMS ) is a high-endurance, semi-submersible vehicle that tows a submerged mine-detection and -classification sensor suite. The Navy originally envisioned procuring at least 12 systems for use on at least 12 DDG-51-class Aegis destroyers, but in FY2003 reduced the program to 6 systems for 6 DDG-51s. Additional RMSs are now to be deployed from LCSs. The Office of Naval Research (ONR) reportedly is developing two USV prototypes as future options for a common USV or family of USVs. The Navy's Spartan Scout USV program uses an unmanned 7-meter (23-foot) or 11-meter (36-foot) boat capable of semi-autonomous operations that can be launched from surface ship or shore. The craft can be equipped with modular payload packages for missions such as mine warfare and antisubmarine warfare (ASW). The Navy accelerated deployment of Spartan; the first system was deployed in October 2003. The Navy's 2005 UUV master plan sets forth nine high-priority missions for Navy UUVs: (1) ISR, (2) mine countermeasures (MCM), (3) anti-submarine warfare (ASW), (4) inspection/identification, (5) oceanography, (6) communication/ navigation network nodes (CN3), (7) payload delivery, (8) information operations, and (9) time-critical strike operations. The plan stresses the need for commonality, modularity, and open-architecture designs for Navy UUVs, organizes Navy UUVs into four broad categories: Man-portabable UUVs with diameters of 3 to 9 inches and weights of 25 to 100 pounds, for use in special-purpose ISR, expendable CN3, very-shallow-water MCM, and explosive ordnance disposal (EOD); Lightweight vehicles with 12.75-inch diameters and weights of up to 500 pounds (the same as lightweight Navy torpedoes), for use in harbor ISR, special oceanography, mobile CN3, network attack, and MCM area reconnaissance; Heavyweight vehicles with 21-inch diameters and weights up to 3,000 pounds (the same as heavyweight Navy torpedoes), for use in tactical ISR, oceanography, MCM, clandestine reconnaissance, and decoys; and Large vehicles with diameters of 36 to 72 inches and weights of up to 20,000 pounds, for use in persistent ISR, ASW, long-range oceanography, mine warfare, special operations, EOD, and time-critical strike operations. The Navy is using its single Long-term Mine Reconnaissance System (LMRS) (which includes two UUVs) and its single Advanced Development UUV (which includes 1 vehicle) to support the development of the Mission-Reconfigurable UUV System (MRUUVS) . The MRUUVS is a 21-inch-diameter, submarine-launched and -recovered UUV being developed for conducting mine countermeasures and ISR missions in areas denied to inaccessible to other Navy systems. The Navy wants the MRUUVS program to start in FY2009, and the first MRUUVs to enter service in 2016. The Large-Displacement, Mission-Reconfigurable UUV System (LD-MRUUVS) is a large, clandestine UUV for launching from submarines, LCSs, and amphibious ships that is to be used for conducting multiple missions, including mine countermeasures (including neutralization), delivery of payloads for special operations forces, persistent ISR, and limited ASW in areas denied or inaccessible to other Navy systems. The Navy is currently developing requirements for the system, and the development effort will leverage technology developed for the 21-inch MRUUVS. The Surface Mine Countermeasure (SMCM) UUV System for use on older Avenger (MCM-1) class mine countermeasures ships and LCSs. The Navy plans to develop and field a few Increment 1 and Increment 2 versions of the SMCM UUV as user operational evaluation systems (UEOS), and then produce an Increment 3 version as a heavyweight-class UUV for use aboard LCSs, with the system entering service in FY2011. The Battlespace Preparation Autonomous Undersea Vehicle (BPUAV) is a 21-inch-diameter AUV with a side-looking sonar for mine detection for use aboard LCSs as a complement to other LCS mine countermeasures systems. The first BPAUV is to be delivered in December 2006 for integration into the first LCS. The Semi-Autonomous Hydrographic Reconnaissance Vehicle (SAHRV) , sponsored by USSOCOM, is a small, man-portable vehicle to be used by Navy Special Warfare (NSW) forces (i.e., Navy SEALs) for hydrographic reconnaissance and mapping operations in very shallow waters. The Navy states that SAHRV "has completed all phases of the acquisition cycle to the point of fielding and sustaining 17 operational units. As such, the SAHRV has achieved Full Operational Capability (FOC) defined by USSOCOM and continues to fulfill a critical requirements capability of NSW forces in the War on Terror." The Navy plans to improve the system's capabilities over time. The Armored Breaching Vehicle (ABV) , currently undergoing developmental testing and field user test and evaluation, is an unmanned, tracked combat engineer vehicle for breaching minefields and complex obstacles. The Army is considering purchasing some for its own use in Iraq. The Gladiator is a wheeled, tele-operated, semi-autonomous UGV for armed reconnaissance and breaching operations. It cab be equipped with machine guns, the Shoulder-Launched Multipurpose Assault Weapon (SMAW), an obscuration smoke system, and a system for breaching anti-personnel systems. The Marine Corps states that Gladiator "was recently removed from System Design and Development (SDD) but development of the revised system continues, test and contingency assets are being designed and built at Carnegie Mellon University (CMU). The Gladiator Baseline 0 Contingency project design and build [effort] is progressing, [and] delivery of the first system is scheduled for 3 rd qtr FY07 with developmental testing to commence in 4 th Qtr FY07. " The MarcBot IV is a small, tele-operated UGV for reconnaissance and surveillance, particularly in investigating improvised explosive devices (IEDs). More than 500 have been fielded for Marine Corps and Army use. An improved design (MarcBot V) is being developed. The Talon is a small (two-man-portable), commercial-off-the-shelf (COTS), tele-operated UGV used by explosive ordnance disposal (EOD) personnel. Numerous systems have been fielded for Marine Corps and Army use, and use of additional payloads (Such as metal detectors, explosive detectors, infrared devices, radars, and weapons) is being explored. The FIDO-PackBot is a UGV equipped with an explosive vapor detector for detecting vehicle-and personnel-borne IEDs at checkpoints and major points of entry. A large number of units are planned for Marine Corps and Army use., with the first entering service in early FY2007. Potential issues for Congress regarding naval UVs include the following: What implications might UVs have for required numbers and characteristics of naval ships and manned aircraft, and naval concepts of operations? Since the current Navy UCAV and Gladiator UGV programs will likely fall far short of meeting the goals established by Section 220 of P.L. 106-398 , should the these programs be accelerated so as to come closer to meeting the goals, or should the goals in Section 220 be amended? How will the restructuring of the J-UCAS program into the Navy-oriented UCAV program affect the Navy UCAV effort? Are the Marine Corps' UAV and UGV programs adequately coordinated with those of the Army? Is the Marine Corps' plan for using upgraded Pioneers as an interim tactical UAV the best approach? The Department of the Navy's proposed FY2008 budget, with funding for various Navy and Marine Corps UV programs, was submitted to Congress in February 2007.

Unmanned vehicles (UVs) are viewed as a key element of the effort to transform U.S. military forces. The Department of the Navy may eventually acquire every major kind of UV. Navy and Marine Corps UV programs raise several potential issues for Congress. This report will be updated as events warrant.

The U.S. Department of Agriculture (USDA) administers a number of agricultural conservation programs that assist private landowners with natural resource concerns. These include working land programs, land retirement and easement programs, watershed programs, emergency programs, technical assistance, and other programs. The number and funding levels for agricultural conservation programs have steadily increased over the past 60 years. Early conservation efforts undertaken by Congress were focused on reducing high levels of soil erosion and providing water to agriculture in quantities and quality that enhanced farm production. By the early 1980s, however, concern was growing that these programs were not adequately dealing with environmental problems resulting from agricultural activities (especially off the farm). In 1985, conservation policy took a new direction when Congress passed the Food Security Act of 1985 (1985 farm bill, P.L. 99-198 ), which established the first conservation programs designed to deal with environmental issues resulting from agricultural activities. Provisions enacted in subsequent farm bills, including in 1990, 1996, 2002, 2008, and 2014, reflect a rapid evolution of the conservation agenda, including the growing influence of environmentalists and other nonagricultural interests in the formulation of conservation policy, and a recognition that agriculture was not treated like other business sectors in many environmental laws. Congress also began funding many of these new programs through mandatory spending for the first time, using the borrowing authority of USDA's Commodity Credit Corporation (CCC) as the funding mechanism instead of annual appropriations. In addition to the original soil erosion and water quality and quantity issues, the conservation agenda has continued to expand to address other natural resource concerns, such as wildlife habitat, air quality, wetlands restoration and protection, energy efficiency, and sustainable agriculture. Lead agricultural conservation agencies within USDA are the Natural Resources Conservation Service (NRCS), which provides technical assistance and administers most conservation programs, and the Farm Service Agency (FSA), which administers the Conservation Reserve Program (CRP). These agencies are supported by others in USDA that supply research and educational assistance, including the Agricultural Research Service (ARS), the Economic Research Service (ERS), the National Institute of Food and Agriculture (NIFA), and the Forest Service (FS). In addition, agricultural conservation programs involve a large array of partners, including other federal agencies, state and local governments, and private organizations, among others, who provide funds, expertise, and other forms of assistance to further agricultural conservation efforts. USDA provides technical and financial assistance to attract interest and encourage participation in conservation programs. Participation in all USDA conservation programs is voluntary. These programs protect soil, water, wildlife, and other natural resources on privately owned agricultural lands to limit environmental impacts of production activities both on and off the farm, while maintaining or improving production of food and fiber. Some of these programs center on improving or restoring resources that have been degraded, while others seek to create conditions with the objective of limiting degradation in the future. Though programs in this report are listed alphabetically, agricultural conservation programs can be grouped into the following categories based on similarities: working land programs, land retirement and easement programs, watershed programs, emergency programs, compliance, technical assistance, and other programs and overarching provisions. The majority of conservation programs are funded through USDA's Commodity Credit Corporation (CCC) as mandatory spending. Congress authorizes mandatory programs at specified funding levels (or acreage enrollment levels for CRP and CSP) for multiple years, typically through omnibus legislation such as the farm bill. Mandatory programs are funded at these levels unless Congress limits funding to a lower amount through the appropriations or legislative process (or puts a ceiling on acreage that can be enrolled). Discretionary programs are funded each year through the annual appropriations process. Despite a steady increase in mandatory funding authority, select conservation programs have been reduced or capped through annual appropriation acts since FY2003. Many of these spending reductions were at the request of the Administration. The mix of programs and amount of reductions vary from year to year. Some programs, such as the CRP, have not been reduced by appropriators in recent years, while others, such as EQIP, have been repeatedly reduced below authorized levels. Authorized mandatory funding for conservation programs has been reduced by a total of more than $4 billion over the past 10 years. FY2018 marks the first time in 15 years that an appropriations act does not reduce mandatory conservation program funding. Sequestration has also had an effect on conservation programs. Sequestration is a process of automatic, largely across-the-board reductions that permanently cancel mandatory and/or discretionary budget authority to enforce statutory budget goals. Discretionary accounts have avoided sequestration in recent years through adjustments to spending limits, although sequestration continues on mandatory accounts. Most all mandatory conservation programs were subject to sequestration in FY2014 through FY2018. Even with sequestration and appropriations act reductions, total annual mandatory funding for conservation programs has grown from a total of $3.9 billion in FY2008 to over $5 billion in FY2018. Before the 1985 farm bill, few conservation programs existed, and only two would be considered large by today's standards. In contrast, leading up to the debate on the 2014 farm bill, there were over 20 distinct conservation programs with total annual spending greater than $5 billion. The differences and number of these programs created general confusion about the purpose, participation, and policies of the programs. Discussion about simplifying or consolidating conservation programs to reduce overlap and duplication, and to generate savings, continued for a number of years. The Agricultural Act of 2014 ( P.L. 113-79 , 2014 farm bill), contained several program consolidation measures, including the repeal of 12 active and inactive programs, the creation of two new programs, and the merging of two programs into existing ones. A number of conservation programs were repealed by the 2014 farm bill or have gone unfunded by Congress in recent years. Table 1 lists these programs and the most recent congressional action taken. The tabular presentation that follows provides basic information covering each of the USDA agricultural conservation programs, including administering agency or agencies within USDA; brief program description; major amendments to the program in the Agricultural Act of 2014 ( P.L. 113-79 ), commonly referred to as the 2014 farm bill; national scope and availability, including participation levels and acres enrolled; states with the highest level of funds obligated or acres enrolled; volume of application backlog or public interest in each program; authorized funding levels, whether mandatory spending or discretionary appropriations, and any funding restrictions; FY2018 funding level in the Consolidated Appropriations Act of 2018 ( P.L. 115-124 ), or, if applicable, the authorized level in the Agricultural Act of 2014 (sequestration and carryover not included unless noted); FY2019 funding level requested by the Administration (sequestration and carryover included where known); statutory authority, recent amendments, and U.S. Code reference; expiration date of program authority unless permanently authorized; and program's website link. Information for the following tables is drawn from agency budget presentations, explanatory notes, and websites; written responses to questions published each year in hearing records of the Agriculture Appropriations Subcommittees of the House and Senate Appropriations Committees; and spending estimates from the Congressional Budget Office. Further information about these programs may be found on the NRCS website at http://www.nrcs.usda.gov and on the "conservation programs" page of the FSA website at http://www.fsa.usda.gov .

The Natural Resources Conservation Service (NRCS) and the Farm Service Agency (FSA) in the U.S. Department of Agriculture (USDA) currently administer 20 programs and subprograms that are directly or indirectly available to assist producers and landowners who wish to practice conservation on agricultural lands. The differences and number of these programs have created general confusion about the purpose, participation, and policies of the programs. While recent consolidation efforts removed some duplication, a large number of programs remain. The programs discussed in this report are as follows Agricultural Conservation Easement Program (ACEP) Agricultural Management Assistance (AMA) Conservation Operations (CO); Conservation Technical Assistance (CTA) Conservation Reserve Program (CRP) CRP—Conservation Reserve Enhancement Program (CREP) CRP—Farmable Wetland Program CRP—Grasslands Conservation Stewardship Program (CSP) Emergency Conservation Program (ECP) Emergency Forest Restoration Program (EFRP) Emergency Watershed Protection (EWP) Environmental Quality Incentives Program (EQIP) EQIP—Conservation Innovation Grants (CIG) Grassroots Source Water Protection Program Healthy Forests Reserve Program (HFRP) Regional Conservation Partnership Program (RCPP) Voluntary Public Access and Habitat Incentive Program Water Bank Program Watershed and Flood Prevention Operations Watershed Rehabilitation Program This tabular presentation provides basic information covering each of the programs. In each case, a brief program description is followed by information on major amendments in the Agricultural Act of 2014 (P.L. 113-79, 2014 farm bill), national scope and availability, states with the greatest participation, the backlog of applications or other measures of continuing interest, program funding authority, FY2018 funding, FY2019 Administration budget request, statutory authority, the authorization expiration date, and a link to the program's website.

The Organic Foods Production Act of 1990 (OFPA) regulates the marketing of organic products by setting national standards for production and processing (handling). To be labeled or sold as "organic," an agricultural product must be produced and handled without the use of synthetic substances, such as chemical pesticides, and in accordance with an organic plan agreed to by an accredited certifying agent and the producer and handler of the product. Products meeting these standards may be labeled as "organic" and may bear a U.S. Department of Agriculture (USDA) seal. Exceptions to the OFPA's general prohibition on the use of synthetic substances in organic products appear on a National List of Allowed and Prohibited Substances. The OFPA requires the Secretary to establish a National Organic Standards Board (NOSB) to develop the National List and to recommend exemptions for otherwise prohibited substances. The OFPA contains guidelines for the inclusion of substances on the National List. The OFPA also requires the Secretary to promulgate regulations "to carry out" the Act. The Secretary published the National Organic Program Final Rule (Final Rule) in December 2000 and it became effective on October 21, 2002 (codified at 7 C.F.R. pt. 205). Among other things, the Final Rule sets forth a four-tier labeling system for organic foods. Under this system, the type of labeling permitted on a product varies according to the percentage of organic ingredients it contains. The labeling scheme distinguishes: products containing 100% organic ingredients, which may be labeled "100 percent organic"; (2) products containing 94 to 100% organic ingredients, which may be labeled "organic"; (3) products containing 70 to 94% organic ingredients, which may be labeled "made with organic (specified ingredients or food group(s))"; and (4) products containing less than 70% percent organic ingredients, which may identify each organic ingredient on the label or in the ingredient statement with the word "organic." In October 2002, Mr. Arthur Harvey filed a pro se suit against the USDA in the U.S. District Court for the District of Maine, alleging that multiple provisions of the Final Rule were inconsistent with the OFPA and the Administrative Procedures Act. The district court ruled in favor of the USDA (i.e., granted summary judgment) on all nine counts brought by Harvey. Harvey subsequently appealed the case to the First Circuit and was supported by a number of public interest groups that filed "friends of the court" or Amici Curiae briefs. The First Circuit sided with Harvey on three counts and remanded the holdings to the district court for further action. In brief, the court found that: nonorganic ingredients not commercially available in organic form but used in the production of items labeled "organic" must have individual reviews in order to be placed on the National List of Allowed and Prohibited Substances; synthetic substances are barred in the processing or handling of products labeled "organic"; and dairy herds converting to organic production are not allowed to be fed feed that is only 80% organic for the first nine months of a one-year conversion. The three holdings did not invalidate OFPA provisions, but rather, qualified or invalidated agency regulations, thereby affecting the implementation of the National Organic Program. On June 9, 2005, the district court issued an order pursuant to the circuit court's instructions that established a two-year time frame in which the Secretary of Agriculture was to create and enforce new rules for the implementation of the National Organic Program in compliance with the circuit court's ruling. Under the order, the Secretary was to issue new regulations within a year (June 9, 2006) but has an additional year to start enforcing them (June 9, 2007). The phase-in implementation was selected by the court in an effort to prevent consumer confusion, commercial disruption, and unnecessary litigation. The rulings in Harvey and subsequent requirements for new regulations, however, were superceded in part, as a result of amendments made to the OFPA by the FY2006 agriculture appropriations act ( P.L. 109-97 , §797). On June 7, 2006, the USDA published revised final rules based on Harvey and the amended OFPA. The amendments made in the appropriations measure address many of the legal concerns (e.g., lack of authority for agency action) observed by the First Circuit. The following paragraphs examine each holding where the court determined that a provision of the Final Rule was inconsistent with the OFPA and then discuss the effect of the applicable provisions from the appropriations act. Each section ends with the USDA's latest regulatory action. Plaintiff challenged the portion 7 C.F.R. §205.606 which permits the introduction of nonorganically produced agricultural products as ingredients in, or as substances on, processed products labeled as "organic" when the specified product is not commercially available in organic form. The regulation lists five specific products—Cornstarch, Gums, Kelp, Lecithin, and Pectin—and also allows for any other nonorganically produced agricultural product when the product is not commercially available in organic form. The OFPA, however, requires all specific exemptions to the Act's prohibition on nonorganic substances to be placed on the National List following notice and comment and periodic review. Harvey claimed that §205.606 provided a blanket exemption to the OFPA's review requirements and allowed ad hoc decisions to be made regarding the use of synthetic substances. The USDA, on the other hand, maintained that the regulation does not establish a blanket exemption, but rather, only permits the use of the five products specifically listed in the section. The court found the USDA's interpretation plausible; however, because the district court did not clarify the regulation's meaning, the circuit court also found Harvey's interpretation potentially credible. Accordingly, the court remanded the count to the district court for entry of a declaratory judgment that would interpret the regulation in a manner consistent with the National List requirements of the OFPA. A declaratory judgment stating that §205.606 does not establish a blanket exemption to the National List requirements in statute for nonorganic agricultural products that are not commercially available was issued on June 9, 2005. The USDA, in compliance with the order, issued a Notice in the Federal Register clarifying the meaning of the regulation on July 1, 2005. However, because of the potential for confusion, the order states that the clarified meaning of §205.606 will not become effective and enforceable until two years from the date of the judgment (June 9, 2007). In the FY2006 agriculture appropriations act, Congress amended 7 U.S.C. §6517(d)—titled "Procedure for Establishing a National List"—to authorize the Secretary of the USDA to develop emergency procedures for designating agricultural products that are commercially unavailable in organic form for placement on the National List for a period of no longer than 12 months. The amendment does not define what an "emergency procedure" would entail; thus, the Secretary would appear to have the authority to describe the term's parameters and to select the substances subject to it. While this amendment creates an expedited petition process for commercially unavailable organic agricultural products, it does not appear to alter the ruling described above. The new rule published on June 7, 2006, did not clarify the conditions of "emergency procedure." However, it clearly restated that the five listed substances were the only nonorganically produced products that could be used as ingredients in organic products, subject to agency restriction when that ingredient is not commercially available in organic form. Plaintiff challenged 7 C.F.R. §205.600(b) and the portion of §205.605(b) that permits synthetic substances as ingredients in, or as substances on, processed products labeled as "organic." Section 205.600(b) provides that synthetic substances may be used "as a processing aid or adjuvant" if they meet six criteria; §205.605(b) lists 38 synthetic substances specifically allowed in or on processed products labeled as "organic." The court found that 7 U.S.C. §6510(a)(1) and §6517(c)(B)(iii) forbid the use of synthetic substances during the processing or handling of a product, unless otherwise required by law. The court noted that the OFPA contemplates the use of certain synthetic substances during the production or growing of organic products, but not during the handling or processing stages. By allowing the use of certain synthetic substances "as processing aids," the court concluded that the regulations contravened the plain language of the OFPA. The circuit court reversed the district court's grant of summary judgment and remanded the count to the district court for entry of summary judgment in Harvey's favor. On remand, the district court ordered the Secretary of the USDA to publish new rules implementing the circuit court's judgment within one year of the date of the judgment (June 9, 2006), but allowed the Secretary to exempt nonconforming products placed in commerce as "organic" for up to two years after the date of the judgment (June 9, 2007). The FY2006 agriculture appropriations act amended §6510(a)(1) and strikes §6517(c)(B)(iii)—provisions that the First Circuit relied upon to emphasize that synthetics were not allowed during the processing or handling of a product. Before the amendment, §6510(a)(1) barred a person on a handling operation from adding any synthetic ingredient during the processing or postharvest handling of a covered product. The amendment added the phrase "not appearing on the National List" after "ingredient," thereby apparently allowing the use of synthetics on the National List during processing or postharvest handling of a covered product. Section 6517(c) establishes guidelines for placing substances on the National List and in subsection (B) sets forth specific requirements with regard to the types of substances that may be exempted for use in production and handling. Specifically subpart (iii) of §6517(c)(B) states that the substance "is used in handling and is non-synthetic but is not organically produced" (emphasis added). This provision, which the court noted "specifically requires the exempted substances be nonsynthetic [sic]," was deleted by the amendment. As there no longer appears to be any general prohibition (though there are other requirements that must be met) against the placement of synthetics on the National List for use during the processing or handling of a covered product, the First Circuit's ruling in count three is likely moot. The USDA determined that there was no need to revise §205.600(b) and §205.605(b) because Congress sufficiently addressed the contradiction and approved the necessary legislative changes. Plaintiff challenged the Final Rule's exception to the OFPA's requirements for dairy herds being converted to organic production. Pursuant to 7 U.S.C. §6509(e)(2), a dairy animal whose milk or milk products will be sold or labeled as organically produced must be raised and handled in accordance with the OFPA for not less than the 12-month period immediately prior to the sale of such milk or milk products. Section §205.236(a)(2) of the Final Rule, however, allows whole dairy herds transitioning to organic production to use 80% organic feed for the first nine months and 100% organic feed for the final three months (i.e., "80-20" rule). The court found the OFPA's requirement for a single type of organic handling for twelve months and the Final Rule's bifurcated approach in direct conflict. The court determined that nothing in the OFPA's plain language permits the creation of an "'exception' permitting a more lenient phased conversion process for entire dairy herds," and consequently, found the regulation invalid. The circuit court reversed the district court's grant of summary judgment and remanded the count to the district court for entry of summary judgment in Harvey's favor. On remand, the district court ordered the USDA to promulgate regulations implementing the circuit court's decision within one year of the date of the judgment (June 9, 2006) and to start enforcement by June 9, 2007. In the FY2006 agriculture appropriations act, Congress amended 7 U.S.C. §6509(e)(2) by adding an exception to the general feeding requirement listed in the provision (i.e., raised and handled in accordance with the OFPA for not less than the 12-month period immediately prior to sale). The new provision, titled "Transition Guideline," allows crops and forage from land included in the organic system plan of a dairy farm that is in the third year of organic management to be consumed by the dairy animals of the farm during the 12-month period immediately prior to the sale of the organic milk or milk products. Generally, crops or forage intended to be sold or labeled as "organic" can not have prohibited substances applied to them for the three years immediately preceding harvest of the crop. Accordingly, while this amendment allows feed for dairy animals to come from land that is still transitioning to "organic" status, it would not appear to allow dairy cows to be fed prohibited substances or genetically modified organisms. Congress' amendment to §6509 likely made the court's ruling in count seven moot. The Secretary revised 7 C.F.R. §205.236 to create two exceptions to the general rule that milk labeled as "organic" must come from cows under continuous organic management for no less than 12 months. First, animals may consume crops and forage from the producer's land that is in the third year of organic management (i.e., the transition guideline). Second, producers converting entire herds to organic production who were still using the "80-20" feed rule before the publication of the new regulation may continue to do so, provided that no milk may be labeled as "organic" by this method after June 9, 2007. This exception allows a period of transition to occur in accordance with the court's order for enforcement of new regulations by the same date.

The First Circuit's ruling in Harvey v. Veneman brought much attention and uncertainty to the U.S. Department of Agriculture's National Organic Program. In the case, Harvey alleged that multiple provisions of the National Organic Program Final Rule (Final Rule) were inconsistent with the Organic Foods Production Act of 1990 (OFPA). The First Circuit sided with Harvey on three counts, putting into question the use of synthetics and commercially unavailable organic agricultural products, as well as certain feeding practices for dairy herds converting to organic production. On remand, the district court ordered a two-year time frame for the implementation and enforcement of new rules consistent with the ruling; however, in the FY2006 agriculture appropriations act (P.L. 109-97), Congress amended the OFPA to address the holdings of the case. This report describes the OFPA, discusses those holdings where the court determined that a provision of the Final Rule was inconsistent with the OFPA, and analyzes the most recent legislative action as well as new regulations from the USDA. This report will be updated as warranted.

Postage stamps were introduced in 1847, but for a half century the designs were limited to images of Presidents and founding fathers. The first commemorative postage stamps were issued in 1893 to mark the Columbian Exposition of that year. The success of the Columbian stamp series prompted the Post Office Department to continue offering stamps to commemorate historic events and places. The commemorative stamp became a fixture of mail service, contributing to civic education and drawing millions into the hobby of philately. When USPS was established in 1971 with an expectation that it would be self-supporting, the revenue potential of commemorative issues became a more prominent consideration. Social issues such as conservation, employment of the handicapped, and higher education were added as commemorative features to the traditional mix of historical and patriotic themes. In 1993, USPS released the Elvis Presley stamp, which generated unprecedented enthusiasm among postal customers (as distinguished from collectors) and still holds the record for stamps saved—124 million with a face value of $35.9 million. The USPS has been criticized by collectors for issuing too many commemorative stamps, as well as for producing too many stamps of a particular issue. Concerns have been expressed that too many stamps diminished the value of the stamps to the hobbyist and had the potential to drive collectors away. Under Postmaster General (PMG) Marvin Runyon, a former collector himself, it became USPS policy to produce and market fewer commemorative stamps. However, in the effort to expand and appeal to a wider range of interests, USPS in the late 1990s began designing stamps not only to attract non-collectors, but also children. This expansion has increased the number of commemorative stamps produced and marketed. The number of separate commemorative stamps issued rose from 26 in 1997, to 81 in 1998, to 121 in 2002. In 2007, USPS will issue 99 commemorative stamps. Errors and subject selection in commemorative stamps have sometimes generated controversy. For example, in 1994 postal officials belatedly discovered that a stamp featuring wild west star Bill Pickett depicted the wrong man. To prevent such occurrences in the future, a historian has been hired by the USPS to authenticate all chosen stamp designs. A widely-circulated news story in 2000 pointed out that of 1,722 commemorative stamps issued since 1893, only 133 (8%) featured women or women's issues. Also, according to a widely-read stamp publication, the PMG was "stunned" by the negative reaction to the stamp issued in honor of Frida Kahlo in 2001; Ms. Kahlo, a Mexican artist and the wife of Diego Rivera, was also a communist, and the stamp was strongly criticized by Senator Jesse Helms. The Citizens' Stamp Advisory Committee (CSAC) was established by the PMG in March 1957. Before it was established, political influence often determined what stamps were issued. The committee operates under 39 U.S.C. 404(a) (4-5), and its primary purpose is to provide "philatelic, history, and artistic judgment and experience" in the selection and design of commemorative stamps. The committee consists of 15 members, none of whom is a postal employee, and whose backgrounds reflect a wide range of educational, artistic, historical, and professional knowledge. Members are appointed and serve at the pleasure of the PMG for three-year staggered terms, with no member able to serve more than four terms. Current members include Joan Mondale, actor Karl Malden, graphic designer Michael Brock, and Harvard professor Henry Louis Gates, Jr. No member may serve more than three terms. The PMG appoints one member to serve as chairperson and another member as vice chairperson, each serving two-year terms. The committee meets quarterly in Washington, DC, or at the call of the CSAC chairperson, to review the thousands of suggestions that are received by the USPS. Its meetings are not public. CSAC itself employs no staff. To expedite its work, employees of the USPS's stamp development group analyze all stamp subject suggestions upon initial receipt. Subcommittees of staff researchers are formed on special themes such as sports, medicine, transportation, black heritage, and performing arts to provide additional background and research. Occasionally, commemorative ideas require considerable research to explore an idea's merit or to devise a strong visual appeal. All supporting materials are then presented to the committee, along with any suggestions. While the primary responsibility of the committee is to review and appraise all proposals submitted for commemoration, the PMG has the exclusive and final authority to determine both the subject matter and the designs for U.S. postage stamps. Thus, for example, although the advisory committee recommended in 2003 that a stamp be commissioned for tercentenary of the birth of 18 th century theologian Jonathan Edwards, PMG John Potter refused to approve the recommendation. Members of Congress are often asked by constituents to support a particular commemorative theme or event. In doing so, a Member may choose to write the PMG expressing support for a particular stamp proposal. This usually results in a referral to the advisory committee. It is not uncommon for Members to introduce congressional resolutions encouraging the commemoration of a specific subject. In the 108 th Congress, 28 resolutions for this purpose were introduced; in the 109 th Congress, 23 resolutions were introduced. However, congressional endorsement of a proposal accords it no special status in the committee's deliberations. The House Committee on Oversight and Government Reform has discouraged Members from introducing bills endorsing the issuance of new commemorative stamps. For the 110 th Congress, the Committee's Rule 20 reads: The committee has adopted the policy that the determination of the subject matter of commemorative stamps ... is properly for consideration by the Postmaster General and that the committee will not give consideration to legislative proposals for the issuance of commemorative stamps and new semi-postal issues. It is suggested that recommendations for the issuance of commemorative stamps be submitted to the Postmaster General. Thus, in the House, when a commemorative stamp bill is introduced, it is referred the committee, which takes no further action on the bill. The Citizens' Stamp Advisory Committee receives about 50,000 nominations each year, and gives no special attention to those submitted by Congress or other legislative bodies. As a basis for its recommendation to the Postmaster General, the advisory committee uses 12 criteria when considering commemorative stamp subjects. They are: It is a general policy that U.S. postage stamps and stationery primarily will feature American or American-related subjects. No living person shall be honored by portrayal on U.S. postage. Commemorative stamps or postal stationery items honoring individuals usually will be issued on, or in conjunction with significant anniversaries of their birth, but no postal item will be issued sooner than five years after an individual's death. Events of historical significance shall be considered for commemoration only on anniversaries in multiples of 50 years. Only events and themes of widespread national appeal and significance will be considered for commemoration. Events or themes of local or regional significance may be recognized by a philatelic or special postal cancellation, which may be arranged through the local postmaster. Stamps or postal stationery items shall not be issued to honor fraternal, political, sectarian, or service/charitable organizations. Stamps or stationery shall not be issued to promote or advertise commercial enterprises or products. Commercial products or enterprises might be used to illustrate more general concepts related to American culture. Stamps or postal stationery items shall not be issued to honor cities, towns, municipalities, counties, primary or secondary schools, hospitals, libraries, or similar institutions. Due to the limitations placed on annual postal programs and the vast number of such locales, organizations, and institutions, singling out any one for commemoration would be difficult. Requests for observance of statehood anniversaries will be considered for commemorative postage stamps only at intervals of 50 years from the date of the state's entry into the Union. Requests for observance of other state-related or regional anniversaries will be considered only as subjects for postal stationery, and only at intervals of 50 years from the date of the event. Stamps or postal stationery items shall not be issued to honor religious institutions or individuals whose principal achievements are associated with religious undertakings or beliefs. Stamps with a surcharge for the benefit of a worthy cause, referred to as "semipostals," shall be issued in accordance with P.L. 106-253 . Semipostals will not be considered as part of the commemorative program and separate criteria will apply. Requests for commemoration of significant anniversaries of universities or other institutions of higher education shall be considered only for stamped cards and only in connection with the 200 th anniversaries of their founding. No stamp shall be considered for issuance if one treating the same subject has been issued in the past 50 years. The only exceptions to this rule will be those stamps issued in recognition of traditional themes such as national symbols and holidays. Other than applying these criteria, the USPS has no formal procedure or required format for submitting stamp proposals, which can be by letter, post card, or petition. After a proposal is determined not to violate the USPS criteria, each proposed subject is listed on the committee's agenda for its next meeting. In-person appeals by stamp proponents are not permitted. Proponents are not advised if a subject has been approved until a general announcement is made to the public. The USPS encourages the submission of commemorative postage stamp subjects to the committee at least three years prior to the proposed date of issuance, to allow sufficient time for consideration, design, and production. Suggestions may be addressed to the Citizens' Stamp Advisory Committee, c/o Stamp Development, U.S. Postal Service, 1735 North Lynn St., Suite 5013, Arlington, VA 22209-6432. In order to encourage stamp collecting, USPS maintains philatelic centers in more than 300 population centers in the United States and in 7 foreign countries. While it is feasible to track the gross revenues USPS gets from the sale of commemorative issues, determining how many stamps are saved (i.e., not used for postage) is difficult. This is because commemorative sales and usage are interchangeable with, and not counted separately from, other stamps and other forms of postage. In an attempt to gain some knowledge of the contribution its commemorative program makes to its bottom line, USPS has tried a number of approaches to measure the retention rate for commemorative stamps. Before 1989, clerks collected "intent to retain" data from customers on six to eight issues per year, and projected retention revenues from the responses. In the following years, USPS launched quarterly surveys of a representative sample of approximately 60,000 households, asking them to report the stamps they bought and those they intended to retain. This was an expensive approach, however, in part because 84% of the households reported that they retained no stamps and thus analysts could learn little from them about relative appeal of various types of issues. In 1999, USPS launched what it termed a more cost-effective design using 10,250 quarterly surveys, 61% of which were to go to households pre-screened (by a market research company) to be "stamp retaining households." The resulting revenue estimates are still inexact and, because of frequent methodological changes, cannot be directly compared. However, there seems to be ample evidence that the commemorative postage stamp program provides net revenues measured in the hundreds of millions of dollars for USPS. According to USPS estimates, retention revenues have been as follows: The stamps most kept by consumers are as follows:

More than 1,800 commemorative stamps have been issued since the first in 1893. In recent years they have been marketed to attract non-collectors and children. In 2007, the U.S. Postal Service (USPS) will issue 99 different commemorative stamps. In considering subjects for commemorative stamps, the USPS Citizens' Stamp Advisory Committee, guided by 12 basic criteria, reviews and appraises the approximately 50,000 proposals submitted for commemoration each year. The postmaster general (PMG) has the exclusive and final authority to determine both subject matter and design. A number of resolutions are introduced in Congress each year urging that consideration be given to a particular subject for commemoration, but few are passed, and the advisory committee accords them no special status. The commemorative stamp program contributed an estimated $225.9 million in retained revenues for the USPS in 2005.

Habeas corpus is the procedure under which an individual held in custody may petition a federal court for his release on the grounds that his detention is contrary to the Constitution or laws of the United States. It has been sought by state and federal prisoners convicted of criminal offenses and by the detainees in Guantanamo. The Supreme Court in Boumediene v. Bush , 553 U.S. 723 (2008), held that limitations on the judicial review of detainee status were contrary to the demands of the privilege of the writ and suspension clause. The Court has thus far declined to hold that a state prisoner sentenced to death, but armed with compelling evidence of his innocence, is entitled to habeas relief. Legislation was introduced in the 111 th Congress to deal with both issues. Moreover, the Constitution Subcommittee of the House Committee on the Judiciary has held hearings on habeas review and received recommendations for legislation on related issues. This report is a brief overview of those recommendations and legislative proposals. Federal law imposes several bars to habeas relief in the interests of finality, federalism, and judicial efficiency. One of these prohibits filing repetitious habeas petitions claiming that the petitioner's state conviction was accomplished in a constitutionally defective manner. This second or successive petition bar does not apply where newly discovered evidence establishes that but for the constitutional defect no reasonable jury would have convicted the petitioner (constitutional defect plus innocence). But suppose the new evidence merely demonstrates the petitioner's innocence, unrelated to the manner in which he was convicted? The Supreme Court has never said that habeas relief may be granted on such a freestanding claim of innocence. It has twice said, however, that assuming relief might be granted in a freestanding innocence case, the evidence on the record before it did not reach the level of persuasion necessary to grant relief. A third such case is now working its way through the federal court system. Two bills offered in the 111 th Congress would have established actual innocence as a ground upon which habeas relief might be granted, the Effective Death Penalty Appeals Act ( H.R. 3986 ) and the Justice for the Wrongfully Accused Act ( H.R. 3320 ). Representative Moore (Kansas) introduced H.R. 3320 on July 23, 2009. Representative Johnson (Georgia) introduced H.R. 3986 on November 3, 2009, for himself and Representatives Nadler, Conyers, Scott (Virginia), Weiner, Lewis (Georgia), and Jackson-Lee. The Johnson bill would have amended the statutory bar on second or successive habeas petitions filed by either state or federal convicts to permit petitions which include: A claim that an applicant was sentenced to death without consideration of newly discovered evidence which, in combination with the evidence presented at trial, could reasonably be expected to demonstrate that the applicant is probably not guilty of the underlying offense. Proposed 28 U.S.C. 2244(b)(5), 2255(h)(3). The proposal's probability standard was one favored by the Supreme Court in second or successive petition cases where the petitioner claimed he was innocent of the underlying offense. The Court favored a clear and convincing evidence standard in cases where the petitioner challenged not his conviction but claimed he was innocent of the aggravating factor that justified imposition of the death penalty. The statutory provisions, established in the Antiterrorism and Effective Death Penalty Act, now favor a clear and convincing evidence standard in the constitutional defect plus innocence exception to the second or successive petition bar. The Johnson bill would also have carried state death row inmates, who claimed innocence, over another statutory habeas bar. Under existing habeas law, federal courts are bound by state court determinations and application of federal law, unless the decisions are contrary to clearly established federal law, constitute an unreasonable application of such law to the facts, or constitute unreasonable finding of facts. Faced with evidence of the petitioner's probable innocence, the Johnson bill would have released federal habeas courts from the binding impact of such state court determinations: They would have no longer been bound by a state court decision that "resulted in, or left in force, a sentence of death that was imposed without consideration of newly discovered evidence which, in combination with the evidence presented at trial, demonstrates that the applicant is probably not guilty of the underlying offense," proposed 28 U.S.C. 2254(d)(3). The 111 th Congress adjourned without further action on the Johnson bill. The Moore bill would have focused its innocence exception to the second or successive petition bar on the evidence tending to establish innocence of state prisoners, death row or otherwise. Moreover, while it would have eased the limitation on filing a second or successive habeas petition, it would have left the standards barring such petitions in place and unchanged. Existing law requires federal courts to dismiss second or successive petitions unless they are based on retroactively applicable new law or are based on newly discovered facts that establish constitutional defect plus innocence. Such a petition, however, may be filed only with the permission of the appropriate court of appeals upon a prima facie showing that the petition meets either the new law or newly discovered evidence exception. The bill would have excused the requirement of appellate court approval "if the second or subsequent application rests solely on a claim of actual innocence arising from – (i) newly discovered evidence from forensic testing; (ii) exculpatory evidence withheld from the defense at trial; or (iii) newly discovered accounts by credible witnesses who recant prior testimony or establish improper action of State or Federal agents," proposed 28 U.S.C. 2244(b)(3)(F). It would have left unchanged the requirement that such petitions be dismissed unless they satisfy the new rule or newly discovered evidence exception. The bill would also have amended existing law to specifically permit a court to receive forensic evidence, exculpatory evidence, and evidence of official misconduct – in support of the petitioner's claim of actual innocence, proposed 18 U.S.C 2243. Testimony of witnesses who testified at trial would be limited to recantations or evidence of impermissible official action, id. Unrelated to any claim of innocence, the Moore bill also would have addressed the bar imposed for failure to exhaust state remedies. Habeas relief may not be granted state prisoners under existing law, when effective corrective state procedures remain untried. The bill would have permitted habeas relief notwithstanding the existence of such unexhausted state procedures, if "the application is based on a claim that the police or prosecution withheld exculpatory, impeachment, or other evidence favorable to the defendant," proposed 28 U.S.C. 2254(b)(4). The 111 th Congress adjourned without further action on the Moore bill. The Supreme Court's decision in Boumediene stimulated several proposals in the 111 th Congress relating to the judicial review for the Guantanamo detainees. The proposals included the: Military Commissions Habeas Corpus Restoration Act of 2009 ( H.R. 64 ), introduced by Representative Jackson-Lee (Texas); Interrogation and Detention Reform Act of 2008 ( H.R. 591 ), introduced by Representative Price (North Carolina) for himself and Representatives Holt, Hinchey, Schakowsky, Blumenauer, Miller (North Carolina), Watt, McGovern, Olver, DeLauro, and Larson (Connecticut); Enemy Combatant Detention Review Act of 2009 ( H.R. 630 ), introduced by Representative Smith (Texas) for himself and Representatives Boehner, Sensenbrenner, Franks (Arizona), Lundgren (California), Gallegly, Jordan (Ohio), Poe (Texas), Harper, Coble, and Rooney; Terrorist Detainees Procedures Act of 2009 ( H.R. 1315 ), introduced by Representative Schiff; Detainment Reform Act of 2009 ( H.R. 3728 ), introduced by Representative Hastings (Florida); and Terrorist Detention Review Reform Act ( S. 3707 ), introduced by Senator Graham. The Court in Boumediene v. Bush held that foreign nationals detained at Guantanamo were entitled to the privilege of the writ of habeas corpus. They could be denied the benefits of access to the writ only under a suspension valid under the suspension clause, U.S. Const. Art. I, §9, cl.2, or under an adequate substitute for habeas review. Section 7 of the Military Commissions Act stripped all federal courts of habeas jurisdiction relating to foreign, enemy combatant detainees; and except as provided in the Detainee Treatment Act, it also stripped them of jurisdiction to review matters relating to such individuals and concerning their detention, treatment, transfer, trial, or conditions of detention. The Court did not feel that the Detainee Treatment Act provided an adequate substitute for detainee habeas review and consequently concluded that section 7 "effect[ed] an unconstitutional suspension of the writ." The Court found it unnecessary to discuss the extent to which habeas review might include an examination of the conditions of detention. It also made it clear that its decision did not go to the merits of the detainees' habeas petitions. Each of the bills, other than the Hastings and Graham bills, would have repealed section 7 of the Military Commissions Act, which unsuccessfully sought to strip the federal courts of jurisdiction to entertain habeas petitions from the Guantanamo detainees. The Smith, Hastings, and Graham bills would have vested the U.S. District Court for the District of Columbia with authority to review the lawfulness of the detention of enemy combatants (Smith), threatening individuals (Hastings), or unprivileged enemy belligerents (Graham). The Smith and Graham bills would have established new habeas provisions applicable to detained enemy combatants, H.R. 630 , proposed 28 U.S.C. 2256; S. 3707 , proposed 2856. The Hastings bill would have established a substitute procedure for judicial review procedure, H.R. 3728 , §§402, 202, 203, 103. The 111 th Congress adjourned without further action on any of these proposals. Witnesses who submitted statements for the House Judiciary Committee's recent habeas hearings criticized other aspects of federal habeas law – issues which do not appear to have been the subject of legislative proposals in this Congress. Each of the witnesses – Justice Gerald Kogan, retired Chief Justice of the Florida Supreme Court; Professor John H. Blume of Cornell University Law School; and Mr. Stephen F. Hanlon, a partner in the law firm of Holland and Knight and appearing on behalf of the American Bar Association – were critical of the impact of the one-year statute of limitations in 28 U.S.C. 2244(d). They expressed concern over the complexity of the provisions under which being tardy can be fatal. They also agree that the binding effect given state court determinations of federal law is unfortunate, generally. Two of the witnesses were critical of the "opt in" provisions under which states gain the advantage of streamlined habeas procedures in capital cases, if they satisfy the provision of counsel standards. Chief Justice Kogan would repeal the provisions, fearing that amendment would only introduce further "confusion, waste, and wheel-spinning." Mr. Hanlon urged alternatively that the role of gatekeeper – the determination of whether a state is qualified to opt in, now vested in the Attorney General – be returned to the federal courts. Professor Blume and Chief Justice Kogan also urged modification of the habeas "procedural default" bar under which a prisoner's federal habeas petition is barred because of his failure to comply with an applicable state procedural requirement for consideration of his claim at the state level. Mr. Hanlon alone recommended federal funding of capital defender organizations and suspension of "all federal executions pending a thorough data collection and analysis of racial and geographical disparities and the adequacy of legal representation in the death penalty system." Chief Justice Kogan also had concerns not mentioned in the statements of the other witnesses, i.e ., the Teague rule, harmless error, and deference to state fact finding. With two exceptions, the Teague rule denies the use of federal habeas to establish, or to retroactively claim the benefits of, a new rule, that is, an interpretation of constitutional law not recognized before the end of the period for the petitioner's direct appellate review of his state conviction and sentence. From Chief Justice Kogan's perspective, "The chief problem is deciding what counts as 'new' in these circumstances." He expressed the view that habeas treatment of harmless constitutional errors committed at the state level "warrants serious attention." Finally, he pointed to the apparent incongruity of section 2254(e)(1), which asserts that a state court's finding of facts is presumed correct, and section 2254(d)(2), which asserts that habeas must be denied with respect to a claim adjudicated in state court unless the state court's decision was based on an unreasonable determination of the facts. If the history of habeas reform debate holds true, each of the points made by the three witnesses is likely to find a counterpoint in any future debate. The 111 th Congress adjourned without further action on these matters.

Federal habeas corpus is the process under which those in official detention may petition a federal court for their release based on an assertion that they are being held in violation of the Constitution or laws of the United States. Major habeas legislative activity in the 111th Congress fell within three areas: proposals to permit state death row inmates to seek habeas relief based on evidence that they are probably innocent (H.R. 3320 and H.R. 3986); proposals to amend federal law in response to the Supreme Court's determination that the level of judicial review afforded Guantanamo detainees failed to meet constitutional expectations (H.R. 64, H.R. 591, H.R. 630, H.R. 1315, H.R. 3728, and S. 3707); and recommendations for revision of several areas of federal habeas law from witnesses appearing before recent House Judiciary Committee hearings. The 111th Congress adjourned without further action on any of these proposals or recommendations. Related CRS Reports include CRS Report R41010, Actual Innocence and Habeas Corpus: In re Troy Davis; CRS Report RL33391, Federal Habeas Corpus: A Brief Legal Overview (also available in abbreviated form as CRS Report RS22432, Federal Habeas Corpus: An Abridged Sketch); CRS Report RL33180, Enemy Combatant Detainees: Habeas Corpus Challenges in Federal Court; and CRS Report R40754, Guantanamo Detention Center: Legislative Activity in the 111th Congress.

The November 2000 elections caused the Senate to be tied with 50 Republicans and 50 Democrats. The issue was further complicated by the election of Richard B. Cheney as Vice President. When the 107 th Congress convened on January 3, 2001, the incumbent Vice President, Albert Gore Jr., presided until Vice President-elect Cheney was sworn in on January 20. Although a titular Democratic majority existed (with Vice President Gore available to break tie votes) and could have tried to organize the Senate, any such organization actions could have been revisited under Republican auspices once Vice President Cheney was in the chair to break ties. The Senate often negotiates formal and informal agreements to govern the legislative agenda and its consideration of individual measures. Similar negotiations about the organization of the Senate began informally in late November between the Democratic leader, Senator Tom Daschle (D-SD), and the Republican leader, Senator Trent Lott (R-MS). Talks continued after the Senate convened, and proposals under consideration by the two leaders were discussed at meetings of the party conferences. Senator Daschle, recognized as majority leader by Vice President Gore who was presiding, made no attempt to replace the incumbent Senate administrative officers with Democratic nominees. In an unprecedented step, the Senate agreed to S.Res. 3 , electing Senator Robert C. Byrd (D-WV) President pro tempore upon the adoption of the resolution, and simultaneously electing Senator Strom Thurmond (R-SC) President pro tempore , to be effective at noon on January 20. The Senate designated committee chairmen on opening day. As Senate committees are continuing bodies, Senators serving on panels in the 106 th Congress retained their positions and roles when the 107 th Congress convened. Several committee chairmen did not return to the 107 th Congress, however, and, for administrative reasons, it was necessary for the Senate, at a minimum, to designate acting committee chairs to replace them, pending election of the full committee slates. The Senate went further in adopting S.Res. 7 , naming Democratic committee chairs on all Senate committees to serve as such through January 20, and naming Republican chairs to assume their posts at noon that day. Two days later, on the afternoon of January 5, 2001, Senator Daschle presented to the Senate S.Res. 8 , a measure to provide the organizational basis for powersharing in the Senate when the parties were equally divided. The resolution was agreed to later that day. The key provisions of the resolution were as follows: Committees All Senate committees would have equal numbers of Republicans and Democrats; a full committee chair could discharge a subcommittee from further consideration of a measure or matter, if it was not reported because of a tie vote; and budgets and office space for all committees were equally divided, with overall committee budgets to remain within "historic levels;" Discharging Measures or Matters If a measure or nomination was not reported because of a tie vote in committee, the majority or minority leader (after consultation with committee leaders) could move to discharge the committee from further consideration of such measure or nomination; this discharge motion could be debated for four hours, equally divided and controlled by the majority and minority leaders. After the expiration (or yielding back) of time, the Senate would vote on the discharge motion, without any intervening action, motion, or debate; and if the committee were discharged by majority vote, the measure or matter would be placed on the appropriate Senate calendar to await further parliamentary actions. Agenda Control and Cloture The agreement prohibited a cloture motion from being filed on any amendable item of business during the first 12 hours in which it is debated; required both party leaders "to seek to attain an equal balance of the interests of the two parties" in scheduling and considering Senate legislative and executive business; and noted that the motion to proceed to any calendar item "shall continue to be considered the prerogative of the Majority Leader," although qualifying such statement with the observation that "Senate Rules do not prohibit the right of the Democratic Leader, or any other Senator, to move to proceed to any item." On January 8, 2001, the provisions of S.Res. 8 were further clarified and other procedures relating to the powersharing agreement were announced. Senator Harry Reid (D-NV), the assistant Democratic floor leader, received unanimous consent to enter a printed colloquy between Senators Daschle and Lott into the Congressional Record , and to direct that "the permanent ( Congressional ) Record be corrected to provide for its inclusion with the resolution when it passed the Senate last Friday." In addition to summarizing the provisions of S.Res. 8 , the colloquy covered several additional issues. In perhaps the most significant announcement, the two leaders pledged to refrain from using their preferential rights of recognition to "fill the amendment tree" in an effort to block consideration of controversial issues. Senator Lott, on behalf of both leaders, declared the policy in the written colloquy. ... (I)t is our intention that the Senate have full and vigorous debates in this 107 th Congress, and that the right of all Senators to have their amendments considered will be honored. We have therefore jointly agreed that neither leader, nor their designees in the absence of the leader, will offer consecutive amendments to fill the amendment tree so as to deprive either side of the right to offer an amendment. We both agree that nothing in this resolution or colloquy limits the majority leader's right to amend a non-relevant amendment, nor does it limit the sponsor of that nonrelevant amendment from responding with a further amendment after the majority leader's amendment or amendments are disposed of. The party leaders agreed that minority party Senators would be permitted to serve as presiding officers of the Senate. This differed from the usual Senate practice under which only majority party Senators serve as temporary presiding officers. The colloquy further specified that both parties would "have equal access" to common space in the Capitol complex for purposes of holding meetings, press conferences, and other events. This supplemented the provisions in S.Res. 8 guaranteeing the minority equal committee office space. The agreement embodied in S.Res. 8 was not comprehensive. It did not address many parliamentary issues. As Senator Lott noted in floor remarks, it covered the issues on which the party leaders were able to reach agreement. "In instance after instance, Senator Daschle and I discussed points, argued about points. When we could not come to agreement, we said we would deal with the rules as they are. So we got it down to what really matters." For example, one issue that was not resolved was conference committee composition. Although the agreement specified equal party strength on the Senate's standing, special, and joint committees, it did not specify equal party strength on conference delegations. Some Senate Republicans were insistent that a majority of Senate conferees be Republicans, reflecting the tie-breaking vote of Vice President Cheney available to approve any conference compromise. As one Republican Senator noted, "I think it's absolutely our position, and my position, that we have to control the conferences." The parliamentary stages though which the Senate passes to get to conference are usually handled by unanimous consent. This particularly includes granting authority to the presiding officer to appoint conferees, based on the recommendations of the committee and floor leaders. If objection is raised to granting this authority, Senate conferees are to be elected by amendable motion, debatable under the normal rules of the Senate. Senator Lott alluded to this possibility in the printed colloquy of January 8. With respect to the ratios of members on conferences, we both understand that under previous Senate practices, those ratios are suggested by the majority party and, if not acceptable by the minority party, their right to amend and debate is in order.... (T)he intention of this resolution is not to alter that practice and this resolution does not serve to set into motion any action that would alter that practice in any way. The Senate did not name conferees through its traditional mechanisms during the powersharing period of the 107 th Congress. During that time, the Senate agreed to send only two measures to conference committee, the budget resolution and the reconciliation bill, but it should be noted that conference procedures on these measures are governed in part by the Budget Act. In both of these cases, a majority of the conferees were Republican. On May 24, 2001, Senator James Jeffords announced his intention to leave the Republican party, to become an Independent, and to caucus with the Senate Democrats. With Senator Jeffords's announcement, the Democrats held a numerical edge in the Senate. On June 5, 2001, Senator Jeffords met with Senate Democrats at their weekly conference meeting. On June 6, the Senate convened with the Democrats as the acknowledged Senate majority party. The powersharing agreement in effect in the Senate from January to June of 2001 was an experiment. It differed from many established practices of the Senate. The agreement was not comprehensive, and new issues came before the Senate that had to be resolved by informal agreements, unanimous consent negotiations, or other means. The success of any Senate organizational settlement depends in part upon its adaptability and that of its members to changing circumstances.

The 2000 elections resulted in a Senate composed of 50 Republicans and 50 Democrats. An historic agreement, worked out by the party floor leaders, in consultation with their party colleagues, was presented to the Senate ( S.Res. 8 ) on January 5, 2001, and agreed to the same day. The agreement was expanded by a leadership colloquy on January 8, 2001. It remained in effect until June of 2001, when Senators reached a new agreement to account for the fact that a Senator had left the Republican party to become an Independent who would caucus with the Democratic party. This report describes the principal features of this and related agreements which provided for Republican chairs of all Senate committees after January 20, 2001; equal party representation on all Senate committees; equal division of committee staffs between the parties; procedures for discharging measures blocked by tie votes in committee; a restriction on the offering of cloture motions on amendable matters; restrictions on floor amendments offered by party leaders; eligibility of Senators from both parties to preside over the Senate; and general provisions seeking to reiterate the equal interest of both parties in the scheduling of Senate chamber business. Also noted is that not all aspects of Senate practice were affected by the powersharing agreement.

Four major principles underlie U.S. policy on legal permanent immigration: the reunification of families, the admission of immigrants with needed skills, the protection of refugees, and the diversity of admissions by the country of origin. These principles are embodied in federal law, the Immigration and Nationality Act (INA) first codified in 1952. Congress has significantly amended the INA several times since, most recently by the Enhanced Border Security and Visa Reform Act of 2002 ( P.L. 107-173 ). An alien is "any person not a citizen or national of the United States" and is synonymous with noncitizen . It includes people who are here legally, as well as people who are here in violation of the INA. Noncitizen is generally used to describe all foreign-born persons in the United States who have not become citizens. The two basic types of legal aliens are immigrants and nonimmigrants . Immigrants are persons admitted as legal permanent residents (LPRs) of the United States. Nonimmigrants—such as tourists, foreign students, diplomats, temporary agricultural workers, exchange visitors, or intracompany business personnel—are admitted for a specific purpose and a temporary period of time. Nonimmigrants are required to leave the country when their visas expire, though certain classes of nonimmigrants may adjust to LPR status if they otherwise qualify. The conditions for the admission of immigrants are much more stringent than nonimmigrants, and many fewer immigrants than nonimmigrants are admitted. Once admitted, however, immigrants are subject to few restrictions; for example, they may accept and change employment, and may apply for U.S. citizenship through the naturalization process, generally after 5 years. Immigration admissions are subject to a complex set of numerical limits and preference categories that give priority for admission on the basis of family relationships, needed skills, and geographic diversity. These include a flexible worldwide cap of 675,000, not including refugees and asylees (discussed below), and a per-country ceiling , which changes yearly. Numbers allocated to the three preference tracks include a 226,000 minimum for family-based, 140,000 for employment-based, and 55,000 for diversity immigrants (i.e., a formula-based visa lottery aimed at countries that have low levels of immigration to the United States). The per country ceilings may be exceeded for employment-based immigrants, but the worldwide limit of 140,000 remains in effect. In addition, the immediate relatives of U.S. citizens (i.e., their spouses and unmarried minor children, and the parents of adult U.S. citizens) are admitted outside of the numerical limits of the per country ceilings and are the "flexible" component of the worldwide cap. The largest number of immigrants is admitted because of family relationship to a U.S. citizen or immigrant. Of the 1,064,318 legal immigrants in FY2001, 64% entered on the basis of family ties. Immediate relatives of U.S. citizens made up the single largest group of immigrants, as Table 1 indicates. Family preference immigrants —the spouses and children of immigrants, the adult children of U.S. citizens, and the siblings of adult U.S. citizens—were the second largest group. Additional major immigrant groups in FY2001 were employment-based preference immigrants , including spouses and children, refugees and asylees adjusting to immigrant status, and diversity immigrants . The Bureau of Citizenship and Immigration Services (BCIS) in the Department of Homeland Security (DHS) is the lead agency for immigrant admissions. Refugee admissions are governed by different criteria and numerical limits than immigrant admissions. Refugee status requires a finding of persecution or a well-founded fear of persecution in situations of "special humanitarian concern" to the United States. The total annual number of refugee admissions and the allocation of these numbers among refugee groups are determined at the start of each fiscal year by the President after consultation with the Congress. Refugees are admitted from abroad. The INA also provides for the granting of asylum on a case-by-case basis to aliens physically present in the United States who meet the statutory definition of "refugee." All aliens must satisfy State Department consular officers abroad and DHS Bureau of Customs and Border Protection inspectors upon entry to the U.S. that they are not ineligible for visas or admission under the so-called "grounds for inadmissibility" of the INA. These criteria categories are: health-related grounds; criminal history; national security and terrorist concerns; public charge (e.g., indigence); seeking to work without proper labor certification; illegal entrants and immigration law violations; lacking proper documents; ineligible for citizenship; and, aliens previously removed. Some provisions may be waived or are not applicable in the case of nonimmigrants, refugees (e.g., public charge), and other aliens. All family-based immigrants entering after December 18, 1997, must have a new binding affidavit of support signed by a U.S. sponsor in order to meet the public charge requirement. The INA also specifies the circumstances and actions that result in aliens being removed from the United States, i.e., deported. The category of criminal grounds has been of special concern in recent years, and the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 expanded and toughened the deportation consequences of criminal convictions. The category of terrorist grounds has also been broadened and tightened up by the USA Patriot Act of 2001. ( P.L. 107-77 ). The annual number of LPRs admitted or adjusted in the United States rose gradually after World War II, as Figure 1 illustrates. However, the annual admissions never again reached the peaks of the early 20 th century. The BCIS data present only those admitted as LPRs or those adjusting to LPR status. The growth in immigration after 1980 is partly attributable to the total number of admissions under the basic system, consisting of immigrants entering through a preference system as well as immediate relatives of U.S. citizens, that was augmented considerably by legalized aliens. In addition, the number of refugees admitted increased from 718,000 in the period 1966-1980 to 1.6 million during the period 1981-1995, after the enactment of the Refugee Act of 1980. The Immigration Act of 1990 increased the ceiling on employment-based preference immigration, with the provision that unused employment visas would be made available the following year for family preference immigration. There are two major statistical perspectives on trends in immigration. One uses the official BCIS admissions data and the other draws on Bureau of Census population surveys. The BCIS data present only those admitted as LPRs or those adjusting to LPR status. The census data, on the other hand, include all residents in the population counts, and the census asks people whether they were born in the United States or abroad. As a result, the census data also contain long-term temporary (nonimmigrant) residents and unauthorized residents. The percent of the population that is foreign born, depicted in Figure 2 , resembles the trend line of annual admissions data presented in Figure 1 . It indicates the proportion of foreign born residents is not as large as during earlier periods, but is approaching historic levels at the turn of the last century. Figure 2 illustrates that the sheer number—32.5 in 2002—has more than doubled from 14.1 million in 1980 and is at the highest point in U.S. history. Another tradition of immigration policy is to provide immigrants an opportunity to integrate fully into society. Under U.S. immigration law, all LPRs are potential citizens and may become so through a process known as naturalization . To naturalize, aliens must have continuously resided in the United States for 5 years as LPRs (3 years in the case of spouses of U.S. citizens), show that they have good moral character, demonstrate the ability to read, write, speak, and understand English, and pass an examination on U.S. government and history. Applicants pay fees of $310 when they file their materials and have the option of taking a standardized civics test or of having the examiner quiz them on civics as part of their interview. The language requirement is waived for those who are at least 50 years old and have lived in the United States at least 20 years or who are at least 55 years old and have lived in the United States at least 15 years. Special consideration on the civics requirement is to be given to aliens who are over 65 years old and have lived in the United States for at least 20 years. Both the language and civics requirements are waived for those who are unable to comply due to physical or developmental disabilities or mental impairment. Certain requirements are waived for those who have served in the U.S. military. For a variety of reasons, the number of LPRs petitioning to naturalize has increased in the past year but has not reached nearly the highs of the mid-1990s when over a million people sought to naturalize annually, as Figure 3 depicts. The pending caseload for naturalization remains over half a million, and it is not uncommon for some LPRs to wait 1-2 years for their petitions to be processed, depending on the caseload in the region in which the LPR lives. Illegal aliens or unauthorized aliens are those noncitizens who either entered the United States surreptitiously, i.e., entered without inspection (referred to as EWIs), or overstayed the term of their nonimmigrant visas, e.g., tourist or student visas. Many of these aliens have some type of document—either bogus or expired—and may have cases pending with BCIS. The former INS estimated that there were 7.0 million unauthorized aliens in the United States in 2000. Demographers at the Census Bureau and the Urban Institute estimated unauthorized population in 2000 at 8.7 and 8.5 million respectively, but these latter estimates included "quasi-legal" aliens who had petitions pending or relief from deportation. Noncitizens' eligibility for major federal benefit programs depends on their immigration status and whether they arrived before or after enactment of P.L. 104-193 , the 1996 welfare law (as amended by P.L. 105-33 and P.L. 105-185 ). Refugees remain eligible for Supplemental Security Income (SSI) and Medicaid for 7 years after arrival, and for other restricted programs for 5 years. Most LPRs are barred SSI until they naturalize or meet a 10-year work requirement. LPRs receiving SSI (and SSI-related Medicaid) on August 22, 1996, the enactment date of P.L. 104-193 , continue to be eligible, as do those here then whose subsequent disability makes them eligible for SSI and Medicaid. All LPRs who meet a 5-year residence test and all LPR children (regardless of date of entry or length of residence) are eligible for food stamps. LPRs entering after August 22, 1996, are barred from Temporary Assistance for Needy Families (TANF) and Medicaid for 5 years, after which their coverage becomes a state option. Also after the 5-year bar, the sponsor's income is deemed to be available to new immigrants in determining their financial eligibility for designated federal means-tested programs until they naturalize or meet the work requirement. Unauthorized aliens, i.e., illegal aliens, are ineligible for almost all federal benefits except, for example, emergency medical care. Aliens in the United States are generally subject to the same tax obligations, including Social Security (FICA) and unemployment (FUTA) as citizens of the United States, with the exception of certain nonimmigrant students and cultural exchange visitors. LPRs are treated the same as citizens for tax purposes. Other aliens, including unauthorized migrants, are held to a "substantive presence" test based upon the number of days they have been in the United States. Some countries have reciprocal tax treaties with the United States that—depending on the terms of the particular treaty—exempt citizens of their country living in the United States from certain taxes in the United States.

Congress typically considers a wide range of immigration issues and now that the number of foreign born residents of the United States—32.5 million in 2002—is at the highest point in U.S. history, the debates over immigration policies grow in importance. As a backdrop to these debates, this report provides an introduction to immigration and naturalization policy, concepts, and statistical trends. It touches on a range of topics, including numerical limits, refugees and asylees, exclusion, naturalization, illegal aliens, eligibility for federal benefits, and taxation. This report does not track legislation and will not be regularly updated.

Under the State Children's Health Insurance Program (CHIP) statute, FY2017 is the last year federal CHIP funding is provided, even though the Patient Protection and Affordable Care Act (ACA; P.L. 111-148 , as amended) child maintenance of effort (MOE) requirement is in place through FY2019. The ACA MOE provision requires states to maintain income eligibility levels for CHIP children through September 30, 2019, as a condition for receiving federal Medicaid payments (notwithstanding the lack of corresponding federal CHIP appropriations for FY2018 and FY2019). This report discusses the ACA MOE requirement for children if federal CHIP funding expires. It begins with a brief background of CHIP, including information regarding program design and financing. The report then describes the ACA child MOE requirements for CHIP Medicaid expansion programs and for separate CHIP programs and discusses potential coverage implications. CHIP is a federal-state program that provides health coverage to certain uninsured, low-income children and pregnant women in families that have annual income above Medicaid eligibility levels but do not have health insurance. CHIP is jointly financed by the federal government and the states and is administered by the states. Participation in CHIP is voluntary, and all states and the District of Columbia participate. The federal government sets basic requirements for CHIP, but states have the flexibility to design their own version of CHIP within the federal government's basic framework. As a result, there is significant variation across CHIP programs. In FY2015, CHIP enrollment totaled 5.9 million and federal and state CHIP expenditures totaled $13.7 billion. CHIP was established as part of the Balanced Budget Act of 1997 ( P.L. 105-33 ) under a new Title XXI of the Social Security Act. Since that time, other federal laws have provided additional funding and made significant changes to CHIP. Most notably, the Children's Health Insurance Program Reauthorization Act of 2009 ( P.L. 111-3 ) increased appropriation levels for CHIP, changed the formula for distributing CHIP funding among states, and altered the eligibility and benefit requirements. The ACA largely maintains the current CHIP structure through FY2019 and requires states to maintain their Medicaid and CHIP child eligibility levels through FY2019 as a condition for receiving federal Medicaid matching funds. The ACA provided federal CHIP funding for FY2014 and FY2015, then the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA; P.L. 114-10 ) extended federal CHIP funding for another two years (i.e., through FY2017). States may design their CHIP programs in three ways: a CHIP Medicaid expansion, a separate CHIP program, or a combination approach in which the state operates a CHIP Medicaid expansion and one or more separate CHIP programs concurrently. CHIP benefit coverage and cost-sharing rules depend on program design. CHIP Medicaid expansions must follow the federal Medicaid rules for benefits and cost sharing, which entitle CHIP enrollees to Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) coverage (effectively eliminating any state-defined limits on the amount, duration, and scope of any benefit listed in Medicaid statute) and exempt the majority of children from any cost sharing. For separate CHIP programs, states can design benefits that look more like private health insurance and may impose cost sharing, such as premiums or co-payments, with a maximum allowable amount that is tied to annual family income. Aggregate cost sharing under CHIP may not exceed 5% of annual family income. Regardless of the choice of program design, all states must cover emergency services; well-baby and well-child care, including age-appropriate immunizations; and dental services. If offered, mental health services must meet federal mental health parity requirements. States that want to make changes to their programs beyond what Medicaid or CHIP laws allow may seek approval from the Centers for Medicare & Medicaid Services (CMS) through the use of the Section 1115 waiver authority. Eight states, the District of Columbia, and the territories had CHIP Medicaid expansions as of May 1, 2015, whereas 13 states had separate CHIP programs and 29 states used a combination approach. According to preliminary CHIP enrollment data for FY2015, almost 60% of CHIP enrollees are in CHIP Medicaid expansion programs and 40% are in separate CHIP programs. CHIP is jointly financed by the federal government and the states. The federal government reimburses states for a portion of every dollar they spend on CHIP (including both CHIP Medicaid expansions and separate CHIP programs) up to state-specific annual limits called allotments. The federal government's share of CHIP expenditures (including both services and administration) is determined by the enhanced federal medical assistance percentage (E-FMAP) rate that varies by state. The E-FMAP rate is calculated by reducing the state share under the federal medical assistance percentage (FMAP) rate (i.e., the federal matching rate for most Medicaid expenditures) by 30%, which increases the federal share of expenditures. For FY2016 through FY2019, the E-FMAP rate increases by 23 percentage points for most CHIP expenditures. With this increase, the E-FMAP ranges from 88% to 100%. Although FY2017 is the last year states are to receive CHIP allotments, federal CHIP outlays are expected in FY2018. States have two years to spend their CHIP allotment funds, so states could have access to unspent funds from their FY2017 allotments and unspent FY2016 allotments redistributed to shortfall states (if any). In a few situations, federal CHIP funding is used to finance Medicaid expenditures. For instance, certain states significantly expanded Medicaid eligibility for children prior to the enactment of CHIP in 1997. These states are allowed to use their CHIP allotment funds to finance the difference between the Medicaid and CHIP matching rates (i.e., the FMAP and E-FMAP rates, respectively) to cover the cost of children in Medicaid above 133% of the federal poverty level (FPL). In addition, states may use CHIP allotment funds and receive the higher CHIP matching rate (i.e., E-FMAP rate) for expenditures for children who had been enrolled in separate CHIP programs and were transitioned to Medicaid due to the ACA provision expanding mandatory Medicaid eligibility for children aged 6 to 18 with incomes up to 133% of FPL. States that design their CHIP programs as a CHIP Medicaid expansion or a combination program and face a shortfall after receiving Child Enrollment Contingency Fund payments and redistribution funds may receive federal Medicaid matching funds to fund the shortfall in the CHIP Medicaid expansion portion of their CHIP programs. When Medicaid funds are used to fund CHIP, the state receives the lower regular FMAP rate (i.e., the federal Medicaid matching rate) rather than the higher E-FMAP rate provided for other CHIP expenditures. However, although federal CHIP funding is capped, federal Medicaid funding is open-ended, which means there is no upper limit or cap on the amount of federal Medicaid funds a state may receive. The ACA extended and expanded the MOE provisions in the American Recovery and Reinvestment Act of 2009 (ARRA; P.L. 111-5 ). The ACA MOE provisions contain separate requirements for Medicaid and CHIP and were designed to ensure that individuals eligible for these programs did not lose coverage between the date of enactment of the ACA (March 23, 2010) and the implementation of the health insurance exchanges (for adults) and September 30, 2019 (for children). Under the ACA MOE provisions, states are required to maintain their Medicaid programs with the same eligibility standards, methodologies, and procedures in place on the date of enactment of the ACA until January 1, 2014, for adults and through September 30, 2019, for children up to the age of 19. The ACA also requires states to maintain income eligibility levels for CHIP children through September 30, 2019, as a condition for receiving payments under Medicaid. The penalty to states for not complying with either the Medicaid or the CHIP MOE requirements would be the loss of all federal Medicaid matching funds. Together, these MOE requirements for Medicaid and CHIP impact CHIP Medicaid expansion programs and separate CHIP programs differently. For CHIP Medicaid expansion programs, the Medicaid and CHIP MOE provisions apply concurrently. For states to continue to receive federal Medicaid funds, the ACA child MOE provisions require that CHIP-eligible children in CHIP Medicaid expansion programs must continue to be eligible for Medicaid through September 30, 2019. When a state's federal CHIP funding is exhausted, the state's financing for these children switches from CHIP to Medicaid. This switch would cause the state share of covering these children to increase because the federal matching rate for Medicaid is less than the E-FMAP rate. As discussed above, states may have some Medicaid expenditures financed with federal CHIP funds. In any of these situations, when federal CHIP funding is exhausted, states would be responsible for continuing to provide Medicaid coverage to these children through September 30, 2019. However, as is the case with the CHIP Medicaid expansion programs, the financing would switch from CHIP to Medicaid, resulting in an increase in the state share of these expenditures because the federal matching rate would be lowered from the E-FMAP rate to the FMAP rate. For separate CHIP programs, only the CHIP-specific provisions of the ACA MOE requirements are applicable. These provisions contain a couple of exceptions: states may impose waiting lists or enrollment caps to limit CHIP expenditures, or after September 1, 2015, states may enroll CHIP-eligible children in qualified health plans in the health insurance exchanges that have been certified by the Secretary of Health and Human Services (HHS) to be "at least comparable" to CHIP in terms of benefits and cost sharing. In addition, in the event that a state's CHIP allotment is insufficient to fund CHIP coverage for all eligible children, a state must establish procedures to screen CHIP-eligible children for Medicaid eligibility and to enroll those who are eligible in Medicaid. For children not eligible for Medicaid, the state must establish procedures to enroll CHIP-eligible children in qualified health plans offered in the health insurance exchanges that have been certified by the Secretary of HHS to be "at least comparable" to CHIP in terms of benefits and cost sharing. The Secretary of HHS was required by statute to review the benefits and cost sharing for children under the qualified health plans in the exchanges and certify those plans that offer benefits and cost sharing at least comparable to CHIP coverage. In the review released November 25, 2015, the Secretary of HHS was not able to certify any qualified health plans as comparable to CHIP coverage because out-of-pocket costs were higher under the qualified health plans and the CHIP benefits were generally more comprehensive for child-specific services (e.g., dental, vision, and habilitation services). Under these ACA MOE requirements, states are required only to establish procedures to enroll children in qualified health plans certified by the Secretary. If there are no certified plans, the MOE requirement does not obligate states to provide coverage to these children. Even when there are certified plans, not all CHIP children may be eligible for subsidized exchange coverage due to the family glitch , among other reasons. FY2017 is the last year in which federal CHIP funding is provided in the CHIP statute. If no additional federal funding is provided for the program, once federal CHIP funding is exhausted, CHIP children in CHIP Medicaid expansion programs would continue to receive coverage under Medicaid through at least FY2019, due to the ACA MOE requirement. However, when CHIP funding is exhausted, CHIP children in separate CHIP programs could obtain coverage through the exchanges or employer-sponsored insurance, but some of the children likely would become uninsured. According to a Medicaid and CHIP Payment and Access Commission estimate of what would happen if separate CHIP coverage ended in FY2018 (which is when federal CHIP funding is expected to be exhausted under current law), 36% of the children with separate CHIP coverage would become uninsured.

The State Children's Health Insurance Program (CHIP) is a means-tested program that provides health coverage to targeted low-income children and pregnant women in families that have annual income above Medicaid eligibility levels but do not have health insurance. CHIP is jointly financed by the federal government and the states and administered by the states. The federal government sets basic requirements for CHIP, but states have the flexibility to design their own version of CHIP within the federal government's basic framework. States may design their CHIP programs in three ways: a CHIP Medicaid expansion, a separate CHIP program, or a combination approach in which the state operates a CHIP Medicaid expansion and one or more separate CHIP programs concurrently. As a result, there is significant variation across CHIP programs. In FY2015, CHIP enrollment totaled 5.9 million and federal and state CHIP expenditures totaled $13.7 billion. Under the CHIP statute, FY2017 is the last year federal CHIP funding is provided, even though the Patient Protection and Affordable Care Act (ACA; P.L. 111-148, as amended) child maintenance of effort (MOE) requirement is in place through FY2019. The MOE provision requires states to maintain income eligibility levels for CHIP children through September 30, 2019, as a condition for receiving federal Medicaid payments (notwithstanding the lack of corresponding federal CHIP appropriations for FY2018 and FY2019). The MOE requirement impacts CHIP Medicaid expansion programs and separate CHIP programs differently. For CHIP Medicaid expansion programs, when federal CHIP funding is exhausted, the CHIP-eligible children in these programs will continue to be enrolled in Medicaid but financing will switch from CHIP to Medicaid. For separate CHIP programs, states are provided a couple of exceptions to the MOE requirement: (1) states may impose waiting lists or enrollment caps to limit CHIP expenditures, and (2) after September 1, 2015, states may enroll CHIP-eligible children in qualified health plans in the health insurance exchanges. In addition, in the event that a state's CHIP allotment is insufficient to fund CHIP coverage for all eligible children, a state must establish procedures to screen children for Medicaid eligibility and enroll those who are Medicaid eligible. For children not eligible for Medicaid, the state must establish procedures to enroll CHIP children in qualified health plans in the health insurance exchanges that have been certified by the Secretary of Health and Human Services to be "at least comparable" to CHIP in terms of benefits and cost sharing. This report discusses the ACA MOE requirement for children if federal CHIP funding expires. It begins with a brief background about CHIP, including information regarding program design and financing. The report then describes the ACA child MOE requirements for CHIP Medicaid expansion programs and for separate CHIP programs and discusses potential coverage implications.

Social Security is financed primarily by payroll and self-employment taxes, as well as by a portion of the proceeds from the income taxation of Social Security benefits. The revenues are deposited in the U.S. Treasury. Social Security benefits and administrative expenses are also paid from the U.S. Treasury. By law, if Social Security revenues exceed expenditures, the "surplus" is credited to the Social Security trust funds in the form of U.S. government securities. The money itself, however, is used to pay for whatever other expenses the government may have at the time. There is no separate pool of money set aside for Social Security purposes. That is not to say that the trust funds are ephemeral—as long as the trust funds show a positive balance, they represent the authority and an obligation for the U.S. Treasury to issue benefit payments during periods when the program's expenditures exceed revenues. At the end of calendar year 2013, the trust funds were credited with holdings of $2.8 trillion. Section 201 of the Social Security Act provides the following guidelines for trust fund investment. 1. Funds not immediately in demand for benefits or administrative expenses are to be invested in interest-bearing obligations guaranteed as to both principal and interest by the United States. 2. Obligations are to be purchased at issue at the issue price or at the market price for outstanding obligations. 3. The Managing Trustee of the Social Security trust funds (the Secretary of the Treasury) is required to invest in special "nonmarketable" federal public-debt obligations—special issues to the trust funds that are not available to the general public—except where he or she determines that the purchase of marketable federal securities is "in the public interest." 4. Special issues shall have maturities fixed with due regard for the needs of the trust funds and will pay a rate of interest, calculated at the time of issue, equal to the average market yield on all marketable interest-bearing obligations of the United States that are not due or callable (redeemable) for at least four years. 5. Marketable federal securities purchased by the trust funds may be sold at the market price and special issue obligations may be redeemed at par plus accrued interest (without penalty for redemption before maturity). The Treasury Department has determined that the purchase of marketable federal securities (i.e., public issues) would be in the public interest only when it might serve to stabilize the market for Treasury issues. Because an "unstable market" would be characterized by falling bond prices, purchases of marketable federal securities at these times would appear to be advantageous for the trust funds. In practice, however, open market purchases have been rare. Although the trust funds have held public issues in the past, the trust funds currently hold special issues only. The interest earned on these holdings is credited to the trust funds semiannually (on June 30 and December 31); it is done by issuing additional federal securities to the trust funds. In calendar year 2013, net interest totaled $102.8 billion, representing 12% of total trust fund income. The effective annual rate of interest earned on all obligations held by the trust funds in calendar year 2013 was 3.8%. The interest rate earned on special issues purchased by the trust funds in August 2014 is 2.375%. The maturity dates of newly issued special issues are set by a standardized procedure. Revenues are invested immediately in short-term issues called certificates of indebtedness, which mature on the next June 30. On June 30 of each year, certificates of indebtedness that have not been redeemed are reinvested in longer-term special issue bonds. Generally, the maturities of these bonds range from 1 to 15 years; the goal is to have about one-fifteenth of them mature each year, depending on the needs of the trust funds. While some critics have questioned whether the current investment policy has constrained the earnings of the trust funds, over the years various advisory councils, congressional committees, and other groups generally have endorsed it. It has been justified as a way to ensure safety of principal and stability of interest, and as a way to avoid intrusion into private markets. It also has been regarded as a way to avoid the political influences that would be inherent in investing outside the U.S. government. Generally, the goal espoused has been to place the trust funds in the same position as any long-term investor seeking a safe rate of return by investing in U.S. securities, and neither advantage nor disadvantage the trust funds relative to these investors or other parts of the government. For most of the program's history, interest income to the trust funds has not been a major factor in program financing. In recent years, however, the increasing role of interest income, as well as interest by some policy makers in preventing any surplus Social Security tax revenues from being used for other government spending purposes, have focused attention on alternative investment practices. For example, there have been proposals to replace the special issues held by the trust funds with marketable federal securities, as well as proposals to allow any surplus Social Security tax revenues or a portion of trust fund reserves to be invested in assets other than U.S. government obligations, including equities.

The Social Security Act has always required surplus Social Security revenues (revenues in excess of program expenditures) to be invested in U.S. government securities (or U.S. government-backed securities). In recent years, attention has been focused on alternative investment practices in an effort to increase the interest earnings of the trust funds, among other goals. This report describes Social Security trust fund investment practices under current law.

The Paris Club is the major forum where creditor countries renegotiate official sector debts. Official sector debts are those that have been issued, insured, or guaranteed by creditor governments. A Paris Club 'treatment' refers to either a reduction and/or renegotiation of a developing country's Paris Club debts. The Paris Club includes the United States and 21 other permanent members, the major international creditor governments. Besides the United States, the permanent membership is composed of Australia, Austria, Belgium, Brazil, Canada, Denmark, Finland, France, Germany, Ireland, Israel, Italy, Japan, Netherlands, Norway, Russia, South Korea, Spain, Sweden, Switzerland, and the United Kingdom. Other creditors are allowed to participate in negotiations on an ad-hoc basis. The entry of Brazil into the Paris Club is notable since they are the first developing country to join in two decades. By contrast, the London Club, a parallel, informal group of private firms, meets in London to renegotiate commercial bank debt. Unlike the Paris Club, there is no permanent London Club membership. At a debtor nation's request, a London Club meeting of its creditors may be formed, and the Club is subsequently dissolved after a restructuring is in place. The Paris Club does not exist as a formal institution. It is rather a set of rules and principles for debt relief that have been agreed on by its members. To facilitate Paris Club operations, the French Treasury provides a small secretariat, and a senior official of the French Treasury is appointed chairman. The current Paris Club chairman is Jean-Pierre Jouyet, Under-Secretary of the French Treasury. In addition to representatives from the creditor and debtor nations, officials from the international financial institutions (IFIs) and the regional development banks are represented at Paris Club discussions. The IFIs present their assessment of the debtor country's economic situation to the Paris Club. To date (July 2017), the Paris Club has reached 433 agreements with 90 debtor countries. The total amount of debt covered in Paris Club agreements—rescheduled or reduced—is approximately $583 billion. Since the first debt restructuring took place in 1956, the terms, rules, and principles of the Paris Club have evolved to their current shape. This evolution occurred primarily through the G7/8 Summits. Five 'principles' and four 'rules' currently govern Paris Club treatments. Any country that accepts the rules and principles may, in principle, become a member of the Paris Club. Yet since the Paris Club permanent members are the major international creditor countries, they determine its practices. The five Paris Club 'principles' stipulate the general terms of all Paris Club treatments. They are (1) Paris Club decisions are made on a case-by-case basis; (2) all decisions are reached by full consensus among creditor nations; (3) debt renegotiations are applied only for countries that clearly need debt relief, as evidenced by implementing an International Monetary Fund (IMF) program and its requisite economic policy conditionality ; (4) solidarity is required in that all creditors will implement the terms agreed in the context of the renegotiations; and (5) the Paris Club preserves the comparability of treatment between different creditors. This means that a creditor country cannot grant to a debtor country a treatment on more favorable terms than the consensus reached by Paris Club members. While Paris Club 'principles' are general in nature, its 'rules' specify the technical details of Paris Club treatments. The 'rules' detail (1) the types of debt covered - Paris Club arrangements cover only medium and long-term public sector debt and credits issued prior to a specified "cut-off" date; (2) the flow and stock treatment; (3) the payment terms resulting from Paris Club agreements; and (4) provisions for debt swaps. Since the Paris Club is an informal institution, the outcome of a Paris Club meeting is not a legal agreement between the debtor and the individual creditor countries. Creditor countries that participate in the negotiation sign a so-called 'Agreed Minute.' The Agreed Minute recommends that creditor nations collectively sign bilateral agreements with the debtor nation, giving effect to the multilateral Paris Club agreement. By recommending that the United States renegotiate or reduce debts owed to it, congressional involvement is necessary to implement any Paris Club agreement. There are four types of Paris Club treatments depending on the economic circumstances of the distressed country. They are, in increasing degree of concessionality: Classic Terms , the standard terms available to any country eligible for Paris Club relief; Houston Terms , for highly-indebted lower to middle-income countries; Naples Terms , for highly-indebted poor countries; and Cologne Terms , for countries eligible for the IMF and World Bank's Highly Indebted Poor Countries Initiative (HIPC). Classic and Houston terms offer debt rescheduling while Naples and Cologne terms provide debt reduction. Classic terms are the standard terms for countries seeking Paris Club assistance. They are the least concessional of all Paris Club terms. Debts are rescheduled at an appropriate market rate. Houston terms were created at the 1990 G-7 meeting in Houston, Texas so the Paris Club could better accommodate the needs of lower middle-income countries. Houston terms offer longer grace and repayment periods on development assistance than do Classic terms. Naples Terms, designed at the December 1994 G-7 meeting in Naples, Italy, are the Paris Club's terms for cancelling and rescheduling the debts of very poor countries. Countries may receive Naples terms treatment if they are eligible to receive loans from the World Bank's concessional facility, the International Development Agency (IDA). A country is eligible for IDA loans if it has a per-capita GDP of less than $755. According to Naples Terms, between 50% and 67% of eligible debt may be cancelled. The Paris Club offers two methods for countries to implement the debt reduction. Countries can either completely cancel the eligible amount, and reschedule the remaining debts at appropriate market rates (with up to 23-year repayment period and a six-year grace period); or they can reschedule their total eligible debt at a reduced interest rate and with longer repayment terms (33 years). Cologne terms were created at the June 1999, G-8 Summit in Cologne, Germany. Cologne terms were created for countries that are eligible for the World Bank and IMF 1996 Highly Indebted Poor Countries Initiative (HIPC). They allow for higher levels of debt cancellation than Naples Terms. Under Cologne terms, 90% of eligible debts can be cancelled. On October 8, 2003, Paris Club members announced a new approach that would allow the Paris Club to provide debt cancellation to a broader group of countries. The new approach, named the "Evian Approach" introduces a new strategy for determining Paris Club debt relief levels that is more flexible and can provide debt cancellation to a greater number of countries than was available under prior Paris Club rules. Prior to the Evian Approach's introduction, debt cancellation was restricted to countries eligible for IDA loans from the World Bank under Naples Terms or HIPC countries under Cologne terms. Many observers believe that strong U.S. support for Iraq debt relief was an impetus for the creation of the new approach. Instead of using economic indicators to determine eligibility for debt relief, all potential debt relief cases are now divided into two groups: HIPC and non-HIPC countries. HIPC countries will continue to receive assistance under Cologne terms, which sanction up to 90% debt cancellation. (The United States and several other countries routinely provide 100% bilateral debt cancellation.) Non-HIPC countries are assessed on a case-by-case basis. Non-HIPC countries seeking debt relief first undergo an IMF debt sustainability analysis. This analysis determines whether the country suffers from a liquidity problem, a debt sustainability problem, or both. If the IMF determines that the country suffers from a temporary liquidity problem, its debts are rescheduled until a later date. If the country is also determined to suffer from debt sustainability problems, where it lacks the long-term resources to meet its debt obligations and the amount of debt adversely affects its future ability to pay, the country is eligible for debt cancellation. The United States began participating in Paris Club debt forgiveness in 1994, under authority granted by Congress in 1993 (Foreign Operations Appropriations, §570, P.L. 103-87 ). Annually reenacted since 1993, this authority allows the Administration to cancel various loans made by the United States. These can include U.S. Agency for International Development (USAID) loans, military aid loans, Export-Import Bank loans and guarantees, and agricultural credits guaranteed by the Commodity Credit Corporation. The procedure for budgeting and accounting for any U.S. debt relief is based on the method used to value U.S. loans and guarantees provided in the Federal Credit Reform Act of 1990. The act, among other things, provides for new budgetary treatment of and establishes new budgetary requirements for direct loan obligations. Since passage of the act, U.S. government agencies are required to value U.S. loans, such as bilateral debt owed to the United States, on a net present value basis rather than at their face value, and an appropriation by Congress of the estimated amount of debt relief is required in advance of any debt relief taking place. Prior to the passage of the act, neither budget authority nor appropriations were required for official debt relief and bilateral debt (and other federal commitments) were accounted for on a cash-flow basis, which credits income as it is received and expenses as they are paid. Determining the net present value is a complex calculation involving several factors, including the terms of loan (whether it is concessional or at market rates), as well as the financial solvency of the debtor and their likelihood of repayment. Following the passage of the act, a working group of executive branch agencies, the Inter-Agency Country Risk Assessment System (ICRAS), was created to maintain consistent assessments of country risk across the many U.S. agencies that make foreign loans. ICRAS operates as a working group. The Office of Management and Budget chairs ICRAS. The U.S. Export-Import Bank provides country risk assessments and risk rating recommendations, which must be agreed on by all the ICRAS agencies. OMB is then responsible for determining the expected loss rates associated with each ICRAS risk rating and maturity level. Each sovereign borrower or guarantor is rated on an 11-category scale, ranging from A to F-. Some analysts, including the Government Accountability Office (GAO), raise concerns about the official process for estimating the cost of foreign loans to the United States, and thus the cost needed to forgive U.S. debt. OMB's current methodology uses rating agency corporate default data and interest rate spreads in a model it developed to estimate default probabilities and makes assumptions about recoveries after default to estimate expected loss rates. According to GAO, the method that OMB employs may calculate lower loss rates than may be justified for the sovereign debt of emerging economies. In 2004, GAO recommended that the Director of OMB provide affected U.S. agencies and Congress with technical descriptions of its current expected loss methodology and update this information when there are changes. GAO also recommended that the OMB Director arrange for independent review of the methodology and ask U.S. international credit agencies for their most complete, reliable data on default and repayment histories, so that the validity of the data on which the methodology is based can be assessed over time. In their response, OMB made no commitment to increase transparency or engage the private sector rating community.

The Paris Club is a voluntary, informal group of creditor nations who meet approximately 10 times per year to provide debt relief to developing countries. Members of the Paris Club agree to renegotiate and/or reduce official debt owed to them on a case-by-case basis. The United States is a key Paris Club Member and Congress has an active role in both Paris Club operations and U.S. policy regarding debt relief overall. The Federal Credit Reform Act of 1990 stipulates that Congress must be involved in any official foreign country debt relief and notified of any debt reduction and debt renegotiation.

Unemployment Compensation (UC) is a joint federal-state program and is financed by federal taxes under the Federal Unemployment Tax Act (FUTA) and by state payroll taxes. The underlying framework of the UC system is contained in the Social Security Act: Title III authorizes grants to states for the administration of state UC laws; Title IX authorizes the various components of the federal UTF; and Title XII authorizes advances or loans to insolvent state UC programs. Among its 59 accounts, the federal UTF in the U.S. Treasury includes the Employment Security Administration Account (ESAA), the Extended Unemployment Compensation Account (EUCA), and the Federal Unemployment Account (FUA); 53 state accounts; the Federal Employees Compensation Account; and two accounts related to the Railroad Retirement Board. Federal unemployment taxes are placed in the ESAA, the EUCA, and the FUA; each state's unemployment taxes are placed in the appropriate state's account. In law, the term Reed Act refers to a part of the Employment Security Financing Act of 1954, P.L. 83-567. This legislation amended Titles IX and XII of the Social Security Act (SSA) and established the basic structure of the UTF. The amendments to Title IX, among other things, provided for the transfer of excess funds in the federal portion of the UTF to the individual state accounts under certain conditions. In practice, there have been two forms of Reed Act distributions. The first form, regular Reed Act distributions, follows the terms as set forth in the Reed Act. The second type, special Reed Act distributions, distributes some of the federal UTF funds to the states where these special distributions may follow some but not all of the conditions set by the Reed Act. The 1998-2002 Reed Act distributions were special distributions. Federal law restricts states to using Reed Act distributions only to cover the cost of state benefits, employment services (ES), labor market information, and administration of state UC and ES programs. Suggested uses by the Department of Labor included establishing revolving funds for UC and ES automation costs, UC and ES performance improvement, costs related to reducing UC fraud and abuse, and improvement in UC claims filing and payment methods. An appropriation by the state's legislature is necessary before the state's share of this distribution may be used for UC and ES administrative expenses. Funds may not be used to extend a temporary unemployment benefit such as the Emergency Unemployment Compensation (EUC08) program. Under FUTA, the federal tax on employers finances the states' administrative costs of UC and loans to states with insolvent UC programs. State UC payroll taxes finance the costs of regular UC benefits. The extended benefits program is funded 50% by the federal government and 50% by the states, but the 2009 stimulus package ( P.L. 111-5 §2005) as amended temporarily provides for 100% federal funding of this program through March 7, 2012. Under FUTA, employers pay a federal tax of 6.0% on wages of up to $7,000 a year paid to each worker. The law, however, provides a credit against federal tax liability of up to 5.4% to employers who pay state taxes in a timely manner. Accordingly, in states meeting the specified requirements, employers pay an effective federal tax of 0.6%, or a maximum of $42 per covered worker, per year. At the end of the federal fiscal year, on September 30 th , the net balance of the ESAA is determined. If the amount in this account exceeds 40% of the prior year's appropriation by Congress, then an "excess" balance exists. This excess balance is transferred first to the EUCA. When that account reaches its statutory maximum, the remaining excess balance is transferred to the FUA. When all three accounts are at their statutory maximums , any remaining excess balance is distributed to the accounts of the states in the UTF based on each state's share of U.S. covered wages. These distributions are called Reed Act distributions. Reed Act distributions occurred in 1956 through 1958 and 1998 through 2002. Table 1 lists the distributions. The most recent Reed Act distribution that was a regular and not a special Reed Act distribution was $15.9 million and occurred in 1998. The Balanced Budget Act (BBA) of 1997, P.L. 105-33 , limited the Reed Act distributions for the 1999 to 2001 period to special distributions of $100 million each year. Any amounts in excess of the $100 million that—absent the BBA amendments—would have been transferred to the states "shall, as of the beginning of the succeeding fiscal year, accrue to the federal unemployment account, without regard" to its statutory limit. In March 2002, the Job Creation and Worker Assistance Act of 2002, P.L. 107-147 , provided for a one-time special Reed Act distribution of up to $8 billion to state accounts in the UTF, where the funds were distributed based upon the formula used for regular Reed Act distributions, using calendar year 2000 state information. The law labeled this transfer a "Reed Act" distribution although it differed from traditional Reed Act distributions, most notably because the law distributed a set dollar amount which was not determined by the statutory ceilings in the federal accounts and was distributed before the end of a fiscal year. There was no Reed Act distribution in 2003, and no regular Reed Act distribution is projected through FY2021. According to the Department of Labor, there is no projected distribution through FY2021 on account outstanding loans owed to the general fund of the U.S. Treasury. According to a General Account Office (GAO, now know as the Government Accountability Office) report, the $8 billion Reed Act distribution reduced 2003 unemployment taxes in 22 states and UC administration costs in 17 states. The Center for Employment Security Education and Research (CESER), a component of the National Association of State Workforce Agencies (NASWA), with the assistance of Booz Allen Hamilton and Decern Consulting, examined how states used the $8 billion special Reed Act Distribution of 2002. This study found that approximately half of the Reed Act distribution was used to lower state unemployment taxes in 2003 and 2004 from what they would have otherwise been. The special distribution also led to increases in spending on UC benefits, UC administration, and employment services. The American Recovery and Reinvestment Act ( P.L. 111-5 §2003) provided for a special UTF distribution. The law provided a special transfer of UTF funds from FUA of up to a total of $7 billion to the state accounts within the UTF as "incentive payments" for changing certain state UC laws. The maximum incentive payment allowable for a state was calculated using the methods also used in Reed Act distributions. That is, funds were to be distributed to the state UTF accounts based on the state's share of estimated federal unemployment taxes (excluding reduced credit payments) made by the state's employers. In addition, the act transferred a total of $500 million from the federal ESAA to the state's accounts in the UTF.

Under the Federal Unemployment Tax Act (FUTA; P.L. 76-379), the federal unemployment tax on employers finances the states' administrative costs of Unemployment Compensation (UC) and loans to states with insolvent UC programs. The extended benefits program is funded 50% by the federal government and 50% by the states, but the 2009 stimulus package (P.L. 111-5 §2005) as amended temporarily provides for 100% federal funding of this program through December 31, 2012. FUTA tax revenues are placed into the Unemployment Trust Fund (UTF) that—among its many accounts—contains three federal accounts and 53 individual state accounts from the states' unemployment taxes. Under certain financial conditions, excess federal tax funds in the Unemployment Trust Fund (UTF) are transferred to the individual state accounts within the UTF. The transferred funds are referred to as Reed Act distributions. The Reed Act, P.L. 83-567, set ceilings in the federal UTF accounts that trigger funds to be distributed to state accounts; Congress has changed these ceilings several times (P.L. 105-33, P.L. 102-318, and P.L. 100-203). There are other transfers in the UTF that are labeled by legislation as special Reed Act distributions. These are distributed in a manner similar to the Reed Act but do not follow all of the Reed Act provisions. The most recent regular Reed Act distribution was $15.9 million and occurred in 1998. The Balanced Budget Act (BBA) of 1997, P.L. 105-33, limited Reed Act distributions for the 1999 to 2001 period to special Reed Act distributions of $100 million each year. In March 2002, the Job Creation and Worker Assistance Act of 2002, P.L. 107-147, provided for a one-time special Reed Act distribution of up to $8 billion to state accounts. The American Recovery and Reinvestment Act (P.L. 111-5 §2003) provided for a special UTF distribution that has some properties similar to a Reed Act distribution. The law distributes up to a total of $7.5 billion to the states through a special transfer of funds from the federal accounts within the UTF to the state accounts, using the methodology required by the Reed Act to determine the maximum state allotments. Up to $7 billion was distributed to states as incentive payments for changing certain state UC laws. Administrative funds totaling $500 million was distributed among the state accounts, regardless of whether states changed their UC laws. According to the Department of Labor, there is no projected regular Reed Act distribution through FY2021 on account outstanding loans in the UTF owed to the general fund of the U.S. Treasury. This report will be updated if legislative activity affects Reed Act distributions.

Inflation, the general rise in the prices of goods and services, is important to policymakers for several reasons. First, rising inflation is unpopular with the public, in part because some households are more adversely affected by inflation than others. Second, high or rising inflation can reduce productivity by distorting price signals, so that it is hard for businesses to tell if prices are changing in relative terms, and by individuals wasting resources in order to maintain the purchasing power of their wealth. Finally, inflation plays a key role in macroeonomic stabilization policy. Changes in inflation often indicate changes in the business cycle—rising inflation is often a sign that the economy is overheating and falling inflation is a sign that the economy is sluggish. The Federal Reserve (Fed) is mandated to keep inflation low and stable, and alters interest rates in order to do so. In recent years, the Fed has focused attention on the core rate of inflation, a measure of inflation that excludes food and energy prices, in explanations of its policy decisions. For example, in July 2007, the third sentence of the 10-sentence Federal Open Market Committee statement summarizing the committee's policy decision read, "Readings on core inflation have improved modestly in recent months." In Fed Chairman Ben Bernanke's July 2007 testimony to Congress, he stated that "Food and energy prices tend to be quite volatile, so that, looking forward, core inflation...may be a better gauge than overall inflation of underlying inflation trends." When core inflation approached 3% in 2006, Chairman Bernanke said that it had "reached a level that, if sustained, would be at or above the upper end of the range that many economists, including myself, would consider consistent with price stability...." This report defines core inflation, reviews recent trends, and analyzes the advantages and drawbacks of using core inflation. No official measure of "inflation" exists. Inflation is measured as the percent change in a price index. Several indices track price changes, with each data series measuring something different. The most commonly cited measure of inflation is the percent change in the consumer price index (CPI) . This index measures the price of a basket of consumer goods and services that is representative of overall consumer purchases in urban areas. When food and energy prices are omitted from the CPI, the remaining basket is commonly referred to as the core CPI . The overall measure of CPI, which includes food and energy, is often referred to as the headline CPI . Another common measure of inflation is the percent change in the GDP (gross domestic product) price deflator , which is used to transform nominal GDP into real GDP. Since the GDP deflator is based on the prices of all goods and services in the economy, it is a broader measure of inflation than the CPI. A subset of the GDP deflator that is conceptually similar to the CPI, but includes more items and areas, is the personal consumption expenditures (PCE) price deflator ; for technical reasons, the Fed sometimes prefers this measure to the CPI in their analyses. Core measures of the GDP and PCE deflators are also available. Conceptually, core inflation could be any measure of inflation that attempts to strip out price volatility, but the most common definition of core strips out only two particularly volatile categories of goods, food and energy. The four most volatile items in the CPI are all food or energy products. The standard deviation of energy prices is estimated to be 12 times higher than overall inflation. Omitting food and energy prices from the CPI is not a trivial modification—food and beverages accounted for 15% of the headline CPI basket, and energy accounted for an additional 9% in 2006. While excluding food from core inflation has become conventional, it may no longer be warranted. The volatility of food has decreased significantly since the 1970s. Until 2007, the recent divergence between headline and core inflation was driven by energy prices. In 2007, food prices rose rapidly—it is too soon to tell whether this development marks a renewed period of persistent volatility. If food prices are no longer volatile, then policymakers may be losing useful information by omitting them. In recent years, headline inflation has typically outpaced core inflation, as seen in Figure 1 , because of the rapid rise in energy prices. In 2007, headline inflation was also driven up by a 3.9% increase in food prices. The difference between core and headline has not always been trivial—from 2003 to 2006, core inflation was 0.9 percentage points lower than headline. Considering that the Fed judges 2% inflation to be on the low side and 3% inflation on the high side, the definition used in these years would have arguably strongly colored their policy stance. The difference between core and headline inflation over this period was overwhelmingly the result of energy prices, which rose by an average of 12.8% a year as measured by the CPI. When comparing purchasing power over two time periods, headline inflation is the relevant measure. Comparisons over time of wages, wealth, rates of return, government transfers such as Social Security payments, and so on should all use a headline measure of inflation, because all of these concepts depend on a broad measure of inflation. For example, adjusting household income by core inflation would not be useful since food and energy consumption account for about one-quarter of average household expenditures. Similarly, government programs and parts of the tax code that are adjusted for inflation are based on headline inflation. Economic growth is also calculated by first adjusting GDP by headline inflation. Core inflation is used by policymakers for the reason offered by Chairman Bernanke in the introduction—policymakers are most concerned about the future path of inflation, and current core inflation data may give better information than current headline data about future headline inflation. Headline inflation often does not have good predictive power over short-time periods because food and energy prices are so volatile. For example, the monthly headline inflation rate varied between -6.3% and 7.5% in 2006 at annualized rates, whereas the core rate varied between 1.2% and 3.6%. Policymakers are concerned with future inflation because of lags between a change in policy and its effect on the economy. In essence, it is already too late for policy to influence current inflation, a policy change today can only affect future inflation. Theoretically, short-term changes in inflation can be caused by the supply-side or demand-side of the economy. When rising inflation is demand-driven, it means that spending is growing too quickly in the overall economy, and production cannot keep pace. This phenomenon is captured in the famous saying "too much money chasing too few goods." The Fed's task is to counteract this by raising interest rates in order to reduce the growth rate of interest-sensitive spending. Likewise, if spending is rising too slowly, inflation will fall, which the Fed can counteract by reducing interest rates. In the short run, the overall inflation rate can also be affected by sharp price changes of individual goods caused by supply shocks. For example, bad weather can drive up food prices or a reduction in the oil supply can drive up energy prices. Since these supply shocks are temporary, they should not have any lasting effect on inflation (holding aggregate spending constant), in which case they can be ignored by policymakers. In the long run, price shocks on the supply side should cancel each other out (since, across all goods, there will be an equal number of positive and negative surprises), and average inflation should be completely demand driven. Ideally, policymakers would like to be able to identify whether any change in inflation was demand-driven or supply-driven. Unfortunately, there is no straightforward way to do this, so they have commonly used core inflation as a proxy for demand-driven inflation, reasoning that food and energy are two sectors of the economy that are most susceptible to supply shocks. Furthermore, policymakers are particularly concerned with inflationary expectations, and a rising core rate may be a better sign than rising headline that inflationary expectations have risen. Relying on core inflation for policymaking has its drawbacks, however. There is no inherent reason that changes in food and energy prices cannot be caused by changes in aggregate demand. For example, rapid spending growth could push up energy prices if supply does not rise in response. In fact, an argument has been made that a change in aggregate demand would first show up in price changes of goods that have flexible pricing, such as commodities that are traded on financial markets where prices change continually to clear the market. Both energy and basic foodstuffs are traded on financial markets, although the CPI measures final food and energy products, not basic commodities. Furthermore, a rise in the price of any one good need not lead to a change in inflation if the prices of other goods fall to offset it. Technically, if a rise in one price leads to a rise in overall inflation, it must be because of some accommodation on the Fed's part (because it did not raise interest rates enough to induce other prices to fall). Most economists believe that some accommodation to relative price changes is desirable because it reduces the volatility of economic growth, whereas zero accommodation could lead to needless disruptions in economic activity. For example, Fed Governor Frederic Mishkin used the Fed's macro model of the U.S. economy to show that when the Fed reacts to changes in headline inflation instead of core inflation, future inflation will be slightly less volatile, but unemployment will be significantly more volatile. But if the Fed accommodates a rise in the price of one good too much, then the price of all goods could start rising. In other words, a rise in headline inflation could feed through to higher core inflation. This scenario occurred in the 1970s where rising energy prices resulted in a rise in total inflation. In scenarios like this one, a focus on core inflation could forestall a needed policy change until it is too late. Indeed, a case can be made today that more of a focus on headline inflation would have avoided the persistent upward trend in core inflation that has occurred from 2003 to 2007 and brought core inflation above the Fed's self-defined "comfort zone." The weakness with the focus on core inflation is that when energy prices rise continually for a period of several years, they no longer represent random price fluctuations that offer no useful information about future inflation. As a result, too much monetary policy accommodation may have taken place recently, causing the economy to overheat. Future events will reveal if this is the case, or if the rise in core inflation can be painlessly reversed without a recession. In the end, the question of what measure of inflation is best for policymaking is an empirical one. One study found that "no core measure does an outstanding job forecasting [headline] CPI inflation...we find no strong evidence to suggest that a selected core measure will be able to retain its usefulness as a tool to forecast inflation for any given period..." Another study did not find a statistically significant relationship between core inflation and future headline inflation, although the relationship becomes significant when limited to a more recent time period. Two other studies found that headline inflation is a better predictor of future headline inflation than core inflation. An explanation for this finding is that during the past 10 years, changes in core inflation have tended to lag behind changes in headline inflation as illustrated in Figure 1 . One study found that a core measure that excludes only energy was a better predictor of future inflation from 1983 to 2001 than a measure excluding food and energy. In fact, that study found food prices to be a better predictor of future inflation than any other measure, including core inflation. Some studies suggest that there may be more sophisticated measurements that are better gauges of underlying inflationary pressures than the standard definition of core inflation. Core inflation has the advantage from a policy perspective, however, of being transparent, whereas the more sophisticated measurements could be hard for the public to understand and open to accusations of data mining or manipulation. While this advantage may make core inflation a useful tool for communicating Fed policy to the public, the empirical evidence suggests it to be, by itself, an inadequate tool for policymaking.

Inflation measures the rate of change in all prices. Maintaining low and stable inflation is one of the primary goals of macroeconomic policy. But how should inflation be measured? Policymakers, particularly at the Federal Reserve, often refer to core inflation in their policy decisions. Core inflation is commonly defined as a measure of inflation that omits changes in food and energy prices. Some policymakers prefer to use core inflation to predict future overall inflation because food and energy price volatility makes it difficult to discern trends from the overall inflation rate. A drawback of an over-reliance on core inflation, however, is that an extended period of rapidly rising food or energy prices could cause all other prices to accelerate. A focus on core may cause policymakers to fail to react to such a rise in inflation until it is too late. This scenario may have occurred recently. Many economists are concerned that rapid increases in food and energy prices are now pushing overall inflation to uncomfortably high levels. Furthermore, several studies have failed to find core inflation to be a good forecaster of future inflation, casting doubt on the very rationale for relying on it.

RS21342 -- Immigration: Diversity Visa Lottery Updated April 26, 2004 The purpose of the diversity visa lottery is, as the name suggests, to encourage legal immigration from countries other than the majorsending countries of current immigration to the United States. The law weighs allocation of immigrant visas heavilytowards alienswith close family in the United States and, to a lesser extent, aliens who meet particular employment needs. Thediversity immigrantcategory was added to the Immigration and Nationality Act (INA) by the Immigration Act of 1990 ( P.L. 101-649 )to stimulate "newseed" immigration (i.e., to foster new, more varied, migration from other parts of the world). (1) The current diversity lottery began inFY1995 following three transitional years with temporary lotteries. (2) The diversity lottery makes 55,000 visas available annually to natives of countries from which immigrantadmissions were lower thana total of 50,000 over the preceding five years. The United States Citizenship and Immigration Services Bureau(USCIS) generatesthe formula for allocating visas according to the statutory specifications: visas are divided among six geographicregions according tothe relative populations of the regions, with their allocation weighted in favor of countries in regions that wereunder-representedamong immigrant admissions to the United States. The Act limits each country to 7%, or 3,850, of the visa limit,and provides thatNorthern Ireland be treated as a separate foreign state. Recipients of the visas become legal permanent residents(LPRs) of the UnitedStates. While the diversity lottery has not been directly amended since its enactment in 1990, the Nicaraguan Adjustment and CentralAmerican Relief Act of 1997 (NACARA) temporarily reduces the 55,000 annual ceiling by up to 5,000 visasannually. Beginning inFY1999, the diversity ceiling became 50,000 to offset immigrant visa numbers made available to certainunsuccessful asylum seekersfrom El Salvador, Guatemala, and formerly communist countries in Europe who are being granted LPR status underspecial rulesestablished by NACARA. While the offset is temporary, it is not clear how many years it will be in effect to handlethese adjustmentsof status. In FY2002, there were 42,829 persons actually admitted or adjusted as LPRs with diversity visas, according to the FY2002 USCISadmissions data. This number represents 4% of all LPRs in FY2002 and is comparable to FY2001, when 42,105diversity immigrantscomprised 3.9% of all LPRs. The top five countries in FY2002 (the latest year for which detailed data are available)were Albania,Ethiopia, Nigeria, Poland, and the Ukraine. As Table 1 details, these five countries have consistently ranked among the top diversity visa sending countries, along withBangladesh, Bulgaria, Morocco, Romania, and Russia. Citizens of Ireland, Poland, and the former Soviet Unionwon the most visasin the mid-1990s, but their participation in the lottery has fallen in recent years. Albania ranks as the top sendingcountry for thisentire period, followed by Nigeria. The numbers for Russia and Ukraine may be understated because nationals whoqualified fromsome of the post-Soviet nations reported that they were born in the Soviet Union. Table 1. Top Diversity Visa Sending Countries, FY1997-FY2002 Source: CRS analysis of USCIS admissions data, reported by DHS Office of Immigration Statistics. PDF version The sending world regions for diversity visas, as intended, differ substantially from the sending regions for family-based andemployment-based immigration. As Figure 1 illustrates, European immigrants comprised 39.4%of the diversity visa recipients incontrast to 10.4% of the family-based and employment-based immigrants in FY2002. African immigrants received38.1% of thediversity visas in contrast to 3.6% of the family-based and employment-based visas. Caribbean, Latin American,and Asianimmigrants dominated family-based and employment-based immigration, and as a result, made up much smallerpercentages of thediversity visa immigrants. (3) To be eligible for a diversity visa, the INA requires that an alien must have a high school education or the equivalent, or two yearsexperience in an occupation which requires at least two years of training or experience. (4) The alien or the alien's spouse must be anative of one of the countries listed as a foreign state qualified for the diversity visa lottery. Diversity lottery winners, like all other aliens wishing to come to the United States, must undergo reviews performed by Departmentof State consular officers abroad and DHS inspectors upon entry to the U.S. (5) These reviews are intended to ensure that they are notineligible for visas or admission under the grounds for inadmissibility spelled out in the INA. (6) These criteria for exclusion aregrouped into the following categories: health-related grounds; criminal history; security and terrorist concerns; public charge (e.g., indigence); seeking to work without proper labor certification; illegal entrants and immigration law violations; ineligible for citizenship; and, aliens previously removed. The State Department announced the FY2005 lottery on August 19, 2003. The 60-day application period began on November 1, 2003and ended on December 30, 2003. (7) For the first time,applications for the diversity lottery must have been submitted electronically. Entrants received an electronic confirmation notice upon receipt of a completed entry form. Paper forms were notaccepted. Sincethe objective of the diversity lottery is to encourage immigration from regions with lower immigration rates, nativesof countries withhigh admissions are usually ineligible. For FY2005, the ineligible countries were: Canada, China (mainland born),Columbia,Dominican Republic, El Salvador, Haiti, India, Jamaica, Mexico, Pakistan, the Philippines, Russia, South Korea,the United Kingdomand dependent territories, and Vietnam. (8) When applying for a diversity visa, petitioners had to follow the instructions issued by the State Department precisely. If there wereany mistakes or inconsistencies with the petition, it may have been disqualified by the State Department. In theFY2003 lottery, over2 million of the 8.7 million applications were disqualified for failure to comply with the instructions. (9) Aliens who submit more thanone application are supposed to be disqualified, but husbands and wives may submit separate entries even thoughspouses andunmarried children under the age of 21 qualify as derivative beneficiaries of successful applicants. Any derivativebeneficiary must belisted on the petition when it is initially filed, and the derivative beneficiary visas are counted against the 50,000visa cap. If adiversity lottery winner dies before obtaining LPR status, the visa is automatically revoked and derivativebeneficiaries are no longerentitled to diversity visa classification. (10) Once all acceptable applications were received by the visa center, the winners were selected randomly by computer. Petitioners whowere not selected were not notified by the State Department. The State Department is expected to notify the winnersof the FY2005diversity lottery by mail between May and July 2004, and their visas will be issued between October 1, 2004 andSeptember 30, 2005. Winning the first round of the FY2005 lottery does not guarantee a visa, because the State Department draws moreapplications thanthe number of visas available. Therefore, winners must be prepared to act quickly to file the necessarydocumentation demonstratingto the State Department that they are admissible as LPRs. The applications are processed on a first-come,first-served basis. Aliensmust complete this process before September 30, 2005 to receive visas. (11) In person interviews are expected to begin in October2004. Some question the continuation of the diversity visa lottery, given that family members often wait years for a visa to immigrate to theUnited States. They state a preference that the 55,000 visas be used for backlog reduction of the other visacategories. Supporters ofthe diversity visa, however, point to the immigration dominance of nationals from a handful of countries and arguethat the diversityvisa provides "new seed" immigrants for an immigration system weighted disproportionately to family-basedimmigrants. Some are arguing that the INA should be amended to prevent nationals from countries that the United States identifies as sponsors ofterrorism from participating in the diversity visa lottery. These critics maintain that the difficulties of performingbackground checksin these countries as well as broader concerns about terrorism should prompt this change. Supporters of current lawobserve thatLPRs coming to the United States in other visa categories are not restricted if they come from nations that sponsorterrorism andargue that the policy should be uniformly applied. Who should bear the costs of operating the lottery has also arisen as a issue. Those aliens who win the lottery pay a fee with their visaapplication, but some argue that a fee should be charged to enter the lottery as well. The diversity visa has beencriticized asvulnerable to fraud and misuse, but the State Department maintains that they are addressing these concerns.

The diversity visa lottery offers an opportunity for immigration to nationals of countriesthat do not have high levels of immigration. Aliens from eligible countries had until noon on December 30, 2003to submit theirapplications for the FY2005 diversity visa lottery. Aliens who are selected through the lottery, if they are otherwiseadmissible underthe Immigration and Nationality Act (INA), may become legal permanent residents of the United States. Participation in the diversityvisa lottery is limited annually to 55,000 aliens from countries that are under-represented among recent immigrantadmissions to theUnited States. In FY2001, over 8 million aliens from around the world sent in applications for the FY2003 lottery. Of the diversityvisas awarded in FY2002, European immigrants comprised 39.4% of the diversity visa recipients and Africanimmigrants received38.1%. This report does not track legislation and will not be regularly updated.

RS21288 -- Smallpox: Technical Background on the Disease and Its Potential Role in Terrorism Updated January 10, 2003 Viruses are essentially small pieces of genetic material in a protein coat. They cannot reproduce by themselves. To multiply, a virus must hijack the replicationmachinery in living cells by infecting another organism. Smallpox is caused by the Variola virus, which undernormal circumstances only infects human cells. There are two types of Variola viruses. Variola minor causes a relatively mild disease that has less thana 1% fatality rate. Variola major causes what isgenerally thought of as smallpox, a very severe illness with a fatality rate of approximately 30%. (1) These viruses are part of the Orthopox genus whichalsocontains the viruses responsible for vaccinia, monkeypox, cowpox, camelpox and mousepox. (2) Before the last reported case of smallpox (a result of a laboratory accident in England in 1978), smallpox was considered to be one of the worst scourges inhuman history. Smallpox is estimated to have killed between 300 and 500 million people in the twentieth centuryalone. Once infected, the victim incubates the virus for seven to seventeen days during which the victim feels and appears normal. This stage is followed by one tofour days of high fever, malaise, headache, and muscle ache, often accompanied with nausea and vomiting. Duringthis time the person looks and feels very ill,but is not yet contagious. After this stage, the characteristic sores develop; first in the mouth then over the rest ofthe body. If the victim survives, the soresscab over and turn to scars in three to four weeks. About 30% of unvaccinated victims die (some sources suggestup to 50%). Up to 80% of the survivors aredisfigured by pockmarks or limb deformities. Smallpox is contagious, but the Centers for Disease Control and Prevention (CDC) (3) considers it to spread less widely and less rapidly than chickenpox,measles, whooping cough, or influenza. The victim is most likely to infect other people when the sores in the mouthare most active. This is in the first weekof the rash when virus comes out of the sores and into the saliva where they are easily aerosolized by coughing orsneezing. Although smallpox is usuallytransmitted by face to face contact, it can also be transmitted through the air over dozens of feet and by contaminatedclothing or bedding. The vaccine works by infecting a person with vaccinia virus which is closely related to smallpox virus. (4) The vaccine triggers immunity against all closelyrelated viruses, including smallpox. This immunity decreases over time; however, people who contract smallpoxeven thirty years after vaccination are muchless likely to die than unvaccinated people. (5) Interestingly, the vaccine also helps reduce the severity of the disease if given to victims within a few days aftersmallpox exposure. This is the only known treatment for smallpox, although several antiviral drugs have shownpromise in preliminary laboratory studies. Although the vaccinia vaccine is very effective at preventing smallpox, it is not without risks. Its complication rate is higher than that associated with anyroutinely used vaccine. Based on historical experience, experts estimate that most vaccinees will experience onlymild side effects such as low-grade fever, but1 in 797 people will experience serious side effects. Table 1 describes the historical complicationrates. Table 1. Historical smallpox vaccine complication rates (cases/million vaccinations) Source: CDC, Morbidity and Mortality Weekly Report, June 22, 2001, Vol. 50, No. RR-10, p.8. Inadvertent inoculation is the spread of the usually localized vaccinia infection to other parts of the body, causing sores and scarring most commonly on theface, genitals, and rectum. Generalized vaccinia causes vaccinia sores over the entire body. Eczema vaccinatumis a sometime fatal skin infection in peoplewho have a skin disorder such as eczema or atopic dermatitis. Encephalitis is a very serious and sometimes fatalinflammation of the brain. Progressivevaccinia is an inexorable rotting away of the flesh around the vaccine site that can sometimes also be fatal. As aresult of these complications, experts project1-2 deaths per million vaccinations. Complications are not limited to people who get vaccinated. People who come into contact with those who have been vaccinated within two weeks may also beexposed to the live vaccinia virus and develop complications. Some experts estimate that up to 20% of thecomplications will occur in the unvaccinatedcontacts. Historically, for every million people vaccinated, about 65 people who were not vaccinated becameinfected and developed a serious complicationsimply by coming into contact with a vaccinee. (6) Because of the high rate of vaccine complications, in 1971, U.S. public health authorities rescinded therecommendation for universal domestic smallpox vaccination. It is likely that the numbers in Table 1 underestimate the current and future problem with the vaccine. Since these numbers were last compiled in 1968, thenumber of people predisposed to problems with the vaccine has increased. Some experts estimate that up to 25%of the population now have conditions thatwould make vaccination contraindicated. These conditions include a history of eczema or other exfoliative skindisorder, pregnancy, or any immunodeficiencywhich could be caused by AIDS, chemotherapy or anti-rejection drugs following organ transplant. Because of theserious risk of transferring the virus to ahousehold member, it is recommended that people who live with someone with one of the above conditions notreceive the vaccine. Excluding these people iscomplicated by the large number of people who are unaware that they have a disease that will produce a serious sideeffect. For example, a vaccinee could livewith one of the estimated 300,000 people in the United States that do not know they are HIV positive. The only product proven to counter some of the vaccine complications is vaccinia immunoglobulin (VIG). This is extracted from the blood of peoplevaccinated with the smallpox vaccine. It is only effective for treatment of eczema vaccinatum and certain cases ofprogressive vaccinia. Significantly, VIGprovides no benefit in the treatment of postvaccinial encephalitis. Current civilian supplies of VIG are controlledby the CDC and are estimated to be enough todeal with the complications from about 27 million vaccinations. The CDC is in the process of procuring more VIG. Because the antiviral drug cidofovir hasshown some anti-vaccinia activity in lab animals, it is available for use as an Investigational New Drug when VIGtreatment fails. Although smallpox was officially declared to have been eliminated from the wild in 1980, many countries maintained laboratory stocks of the virus obtainedduring outbreaks. By 1985, these stocks were supposed to have been destroyed or transferred to one of the officialrepositories; one in the Soviet Union and theother in the United States. Russia inherited the smallpox stewardship following the break up of the Soviet Union. Although only the United States and Russia have declared stocks ofsmallpox, some experts have stated that although very unlikely, it is possible that some other countries haveundeclared stocks. Countries that may havedeliberately or inadvertently retained smallpox virus from naturally occurring outbreaks before eradication include:China, Cuba, India, Iran, Iraq, Israel, NorthKorea, Pakistan, and Yugoslavia. (7) A November2002 CIA intelligence review added France to this list and reportedly states a "high, but not very high [levelof] confidence" that Iraq and France have live smallpox samples and a "medium" level of confidence that NorthKorea does. (8) The highest barrier to a non-state sponsored terrorist using smallpox is likely to be the difficulty in obtaining the virus in the first place. Because all countrieshave stopped smallpox vaccination programs, citizens of all countries are equally vulnerable to a spreadingepidemic. Therefore, it is in the best interest of acountry with even an undeclared smallpox stock to keep it very secure. Despite this, some fear that the Russianstocks may not be sufficiently secure due to theeconomic collapse that accompanied the break up of the Soviet Union. Other than from a government controlled stockpile, some have suggested that it may be possible to acquire the virus from the bodies of smallpox victims buriedin the Siberian permafrost in the 1800s. However, this is probably unlikely since Russian experts have been unableto acquire viable virus this way despitemultiple attempts. (9) In 2002, American scientistssuccessfully constructed infectious polio virus from mail-ordered pieces of DNA. (10) However, most expertsclaim that it would be very difficult to construct Variola virus in this manner. For more information on this topic,see CRS Report RS21369(pdf) SyntheticPoliovirus: Bioterrorism and Science Policy Implications . If a terrorist organization were able to obtain a sample of virus, it would also need the advanced technical knowledge, skill and facilities to maintain the viruswithout infecting themselves until the planned dissemination. It is considered to be quite difficult to "weaponize"smallpox. (11) However, in general,weaponization refers to developing advanced delivery systems such as missiles, artillery, or bombs to cause masscasualties. This technological barrier wouldbe much lower for a terrorist. A terrorist, who was not concerned with his own survival could potentially use hisown body as the delivery system, infectingdozens of people before succumbing to the disease. In addition to the threat posed by terrorist groups, it is possible that another nation may choose to use smallpox against the United States. Some experts suggestthat of the countries that might have undeclared stocks of smallpox virus, Iraq may pose the most danger to theUnited States. Some experts believe that it isvery unlikely that Iraq has smallpox since they did not use it during the Gulf War. However, those who feel thatIraq has the smallpox virus counter that itwould not have been used because it is not well suited for battlefield deployment since it is contagious and likelyto infect troops on both sides. Some expertsalso believe that Iraq was dissuaded from using chemical or biological weapons by what could have been interpretedas a thinly veiled threat of nuclearretaliation. (12) In the current situation of risingtensions, some experts have stated that if Iraq has the capability, Saddam Hussein may unleash smallpox as aweapon of last resort, particularly if he can deploy it covertly on United States soil. (13) In December 2002, the Administration reserved the right to use nuclearweapons to respond to the use of weapons of mass destruction against the United States or its allies. (14) Nonetheless, most experts feel that the barriers posed by acquisition and successful deployment of smallpox virus are high enough to make such an attack veryunlikely. Furthermore because of these hurdles, most experts feel that a terrorist organization would require a statesponsor in order to successfully obtain anddeploy smallpox. Although most experts deem the risk of a smallpox attack to be very low, the high consequences of a release have led the President to order the vaccination ofapproximately 500,000 people in the armed forces and to initiate a voluntary program to encourage as many as 10million medical workers and first respondersto be vaccinated. By the middle of 2003, the vaccine will be available on demand to any American adult who is notin a high-risk group for complications. However, the Administration will not recommend vaccination for members of the general public because of the highcomplication rate. (15) Scientific research may be able to further limit the threat posed by smallpox. If a safer smallpox vaccine could be produced, for instance, public health officialswould be less reluctant to recommend mass vaccination. The development of such a vaccine is stymied by severalfactors. One is that it is difficult to predictbefore making a large investment whether a new vaccine will be safer and still effective against smallpox. (16) Another factor is the uncertain market of atherapeutic agent that is designed to protect against what most experts agree is a very unlikely event. Without aguaranteed market, the commercial sector maybe reluctant to make such investments. Some experts suggest that, in general, it may be better to develop treatments rather than relying on prophylactic measures for the many potential biologicalagents that could be used to attack the United States. They suggest that the financial and societal costs of multiplemass vaccination programs may make avaccines-only approach impractical. Some scientists are working on producing antiviral drugs as a cure forsmallpox and several have shown promise inpreliminary studies. (17) However, more work needsto be done to improve animal models of smallpox so that the efficacy of new therapeutics can be tested. (18) Another potential advantage of this approach is that these drugs may be effective against other viruses and thereforemight be marketable as treatments forinfluenza or AIDS. The United States might be better equipped to defend against a smallpox attack if the status of any undeclared smallpox stocks could be determined with greatercertainty. For example, if it could be determined that Iraq does not have any smallpox then focus could be shiftedto preventing terrorist access to other sources. Unfortunately, it is possible that Iraq could successfully hide a smallpox program from any inspection regime. The United States is helping to increase the security of the former Soviet Union's biological weapon stockpiles. By focusing on the physical security of theagents and the economic security of the scientists, these programs simultaneously reduce the threat posed by all ofthe agents in the former Soviet Union'sarsenal. For a comprehensive discussion of these programs, see CRS Report RL31368(pdf) PreventingProliferation of Biological Weapons: U.S. Assistance to theFormer Soviet States .

Smallpox, which kills approximately 30% of its victims, is estimated to have killedbetween 300 and 500 millionpeople in the twentieth century before the World Health Organization's successful eradication program. Thesmallpox vaccine is effective at preventingsmallpox but has a higher complication rate than any other currently used vaccine. The terrorist attacks of 2001have increased fears that smallpox might beused as a weapon of terror. Smallpox has several properties that might make it desirable by terrorists, such ascontagiousness and high lethality. These factorsand its limited availability also make it difficult for a terrorist to use. Most experts agree that it is very unlikely thatsmallpox will be used as a weapon, but thehigh consequences of a successful attack have prompted exploration of methods to counter this threat. Also seeCRS Report RL31694 Smallpox VaccineStockpile and Vaccination Policy and CRS Report RL31368(pdf), Preventing Proliferation of BiologicalWeapons: U.S. Assistance to the Former Soviet States. This report will updated as warranted.

Veterans may participate in the general employment and training programs open to everyone seeking jobs, or in certain programs targeted specifically to veterans. In addition, the federal government has a policy of assisting veterans in employment through the use of preferences in federal employment, and requirements for affirmative action in the hiring of veterans by federal contractors. This report will provide an overview of these federal employment and training programs targeted to veterans, and federal policies to assist veterans in obtaining federal employment. Part of the Servicemen's Readjustment Act of 1944 (The GI Bill, P.L. 78-346) provided a cash allowance for returning unemployed veterans. This was provided because, at the time, veterans were not eligible for unemployment compensation. However, because of a combination of factors, including the strong economic growth shortly after World War II and the GI Bill's education and training benefits, few veterans took advantage of the cash assistance program. There is currently no system to provide a cash allowance to veterans seeking civilian employment although veterans are eligible for unemployment compensation, which provides partial replacement of lost cash wages. The federal government operates programs to assist veterans seeking civilian employment and provides preferences in federal employment for veterans. Outlined below are the major federal programs and policies to assist veterans seeking civilian jobs. The Department of Labor (DOL), in cooperation with the Department of Defense (DOD) and the Department of Veterans Affairs (VA), operates the Transition Assistance Program (TAP) and Disabled Transition Assistance Program (DTAP). Both programs are designed to provide information on employment and training for servicemembers within 180 days of separation from military service, or retirement. TAP is a three-day workshop conducted at military installations that includes sessions on how to look for jobs, current market conditions (both labor market and occupation-specific information is provided), preparation of job search materials (including resumes), and interview techniques. DTAP adds additional hours to the three-day program focused on the special needs of disabled servicemembers. In addition to the employment assistance sessions, information is provided on veterans benefits administered by the VA. P.L. 112-56 makes the following changes to TAP: mandatory participation in TAP by all members of the Armed Forces eligible for the program with the following two exceptions: (1) those that the Secretaries of Defense and Homeland Security, in consultation with the VA Secretary and the DOL Secretary, determine are unlikely to face major readjustment, health care, employment, or other transition challenges; and (2) those with specialized skills needed for an imminent deployment. the DOL Secretary, in consultation with the VA and the DOD Secretaries, is to enter into a contract for a study to identify equivalences between military training, military occupational specialties (MOS), military experience, and civilian private employment. The study is to be transmitted to Congress and made publicly available on the Internet. the DOD Secretary is to ensure that each servicemember participating in TAP receives an individualized assessment of civilian private sector employment positions for which the servicemember may be qualified based on the servicemember's military skills, training, MOS, and the results of the contracted study. the VA Secretary is required to enter, before November 21, 2013, into a contract to provide, at each TAP location, the following services to participants: counseling, identifying and applying for employment and training opportunities, assessment of academic preparation for enrollment in education and training programs, and other related or appropriate services (as identified by the VA Secretary). the VA, DOD, DOL, and Homeland Security Secretaries may enter into contracts with private entities that have experience in assisting members of the Armed Forces to provide TAP instruction on private sector culture (including resume writing, networking, and job search training), academic readiness, and other relevant topics. the DOD Secretary and the Secretary of Homeland Security may permit a member of the Armed Forces eligible for the TAP program to participate in an apprenticeship program. Before November 21, 2013, the comptroller general shall conduct a review of the TAP and report to Congress on the results of the review and any recommendations to improve TAP. The DOL Veterans' Employment and Training Service (VETS) offers assistance to veterans seeking jobs through the Jobs for Veterans State Grants (JVSG) Program. Under the program, grants are used to fund Disabled Veterans' Outreach Program (DVOP) specialists and Local Veterans' Employment Representatives (LVER). These are state positions, funded by the federal government, that provide outreach and assistance to veterans seeking employment. DVOP staff in a state are involved in outreach efforts to disabled veterans with greater barriers to employment, who therefore need more intensive services for employment or training. LVER staff help veterans find employment and are involved in outreach to the business community to encourage the hiring of veterans (including disabled veterans). P.L. 112-56 provides that the DOL Secretary shall award grants, to no more than three organizations, and for no more than two years, to provide training and mentoring for veterans seeking employment. The grant recipients must collaborate with disabled veterans' outreach specialists and local veterans' employment representatives. The DOL Secretary must report to Congress within six months on the process for awarding grants and within 18 months on an assessment of the grant results. The grant program is authorized for $4.5 million for the FY2012-FY2013 period. The VETS office also operates the Veterans' Workforce Investment Program (VWIP), a grant program authorized under the Workforce Investment Act (WIA, P.L. 105-220 ). Grants may be made to fund programs operated by eligible state and local workforce investment boards, state or local agencies, or private non-profit organizations. The grants are intended to help reintegrate veterans into the civilian labor force; develop service delivery systems that address the needs of veterans entering the civilian workforce; enhance workforce investment activities related to veterans; and perform outreach or public information activities to promote employment of veterans. In addition to the JVSG Program and the VWIP program, the VETS office in DOL also provides grants under the Homeless Veterans Reintegration Program, and information to veterans and employers on re-employment rights under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA, P.L. 103-353 ). All VETS activities are required partners in the One-Stop Career Center system established by WIA. Any workforce development, job training, or placement program funded in part by DOL must provide a priority in services for veterans and eligible spouses. In general, persons covered under the priority of service (veterans and spouses) receive access to services and resources before non-covered persons. The federal government has four policies that provide a preference to veterans: (1) a system of point preference for hiring; (2) special appointment (hiring) authority; (3) affirmative action requirements for federal agencies; and (4) affirmative action requirements for contractors and subcontractors. Veterans are given a federal preference in hiring to prevent an individual from being penalized for having spent time in military federal service. A five-point preference is given to veterans with an honorable or general discharge who served on active duty (not active duty for training): during any war; during the period April 28, 1952, through July 1, 1955; for more than 180 consecutive days, any part of which occurred after January 31, 1955, and before October 15, 1976; during the Gulf War period beginning August 2, 1990, and ending January 2, 1992; for more than 180 consecutive days, any part of which occurred during the period beginning September 11, 2001, and ending on the date prescribed by presidential proclamation or by law as the last day of Operation Iraqi Freedom; or in a campaign or expedition for which a campaign medal has been authorized, such as El Salvador, Lebanon, Grenada, Panama, Southwest Asia, Somalia, and Haiti. To qualify for a five-point preference, medal holders and Gulf War veterans who originally enlisted after September 7, 1980, or entered on active duty on or after October 14, 1982, without having previously completed 24 months of continuous active duty, must have served continuously for 24 months or the full period called or ordered to active duty. As of October 1, 1980, military retirees at or above the rank of major or equivalent are not entitled to preference unless they qualify as disabled veterans. A 10-point preference is given to honorably separated veterans who qualify as disabled veterans because they have served on active duty in the Armed Forces at any time and have a present service-connected disability or are receiving compensation, disability retirement benefits, or pension from the military or the Department of Veterans Affairs; honorably separated veterans who are Purple Heart recipients; the spouse of a veteran unable to work because of a service-connected disability; the unmarried widow of certain deceased veterans; and certain mothers of veterans who died in service or who are permanently and totally disabled. P.L. 112-56 provides that a servicemember may be certified as a preference eligible for federal employment if he or she is within 120 days of separation from military service. There are three special appointment authorities available to federal government agencies related to veterans: (1) Veterans Recruitment Appointment (VRA); (2) Veterans Employment Opportunity Acts (VEOA); and (3) 30% or More Disabled Veteran (30%). The use of a VRA allows agencies to appoint an eligible veteran without competition. The VRA is an excepted appointment to a position that is otherwise in the competitive service. After two years of satisfactory service, the veteran may be converted to a career-conditional appointment in the competitive service. Once in federal employment, VRAs are treated like any other competitive service employee and may be promoted, reassigned, or transferred. VRA appointees with less than 15 years of education must complete a training program established by the agency. Veterans eligible for a VRA appointment are disabled veterans; veterans who served on active duty in the Armed Forces during a war, or in a campaign or expedition for which a campaign badge has been authorized; veterans who, while serving on active duty in the Armed Forces, participated in a U.S. military operation for which an Armed Forces service medal was awarded; or recently separated veterans. In addition to meeting the criteria above, veterans must have been separated under honorable conditions (i.e., the individual must have received either an honorable or general discharge). Federal agencies can recruit outside their own workforce, to all competitive service employees, in filling permanent competitive service openings. Veterans are eligible to apply for this type of open position even if not a current competitive service employee if the veteran is a preference eligible or has completed three or more years of active service. The federal government agency can then appoint the veteran using the VEOA appointment authority. The 30% or more disabled veteran authority allows a federal government agency to non-competitively appoint any veteran with a 30% or more service-connected disability to a permanent, temporary (one year or less), or term (one to four years) position in the competitive service. For permanent appointments, the veteran is placed in a time limited (60 days maximum) appointment and then converted to permanent at management's discretion. Federal agencies must have a separate affirmative action program for disabled veterans as part of agency efforts to hire, place, and advance persons with disabilities under the Rehabilitation Act of 1973 ( P.L. 93-112 ). Agencies are required to provide placement consideration under special noncompetitive hiring authorities for VRAs and veterans with a disability rating of 30% or more; ensure that all veterans are considered for employment and advancement under merit system rules; and establish an affirmative action plan for the hiring, placement, and advancement of disabled veterans. Contractors and subcontractors with federal contracts in excess of $100,000 must report to the DOL on efforts to hire veterans in specific categories: disabled veterans, other protected veterans, Armed Forces service medal veterans, and recently separated veterans. Contractors and subcontractors are required to post job openings through state job services or one stop offices, and may post job openings on the federal online service (USAJOBS). On November 9, 2009, President Obama issued Executive Order 13518, which established a Veterans Hiring Initiative and established a Council on Veterans Employment co-chaired by the Secretaries of DOL and VA. As part of the initiative, the Office of Personnel Management (OPM) established a new website— http://www.fedshirevets.gov —to provide information for veterans on federal government employment. One of the features of the website is an agency directory providing for each agency, the name, email address, and telephone number of the individual within each agency responsible for promoting veterans' employment within the agency. P.L. 112-56 provides that the OPM Director shall designate federal executive agencies that will be required to establish a program (coordinated with TAP) to provide employment assistance to separating servicemembers, including employment with the agency, and to promote the recruiting, hiring, training, development, and retention of servicemembers and veterans by the agency. The Department of Defense Appropriations Act, 2003 ( P.L. 107-248 ) authorized the DOD to transfer funds to the Center for Military Recruitment, Assessment, and Veterans Employment. The center is a 501(c)(6) organization supported by construction employers and building and trade organizations within the AFL-CIO to help veterans find employment in the construction industry, through operation of the "Helmets to Hardhats" program. The transfer of funds has been done each year since FY2003. The FY2010 transfer was $3.0 million as provided by the Department of Defense Appropriations Act ( P.L. 111-118 ). The Department of Education transfers funds to the DOD to provide funding for participants in the "Troops 2 Teachers" Program. The program can provide a stipend of up to $5,000 for eligible military personnel to obtain certification as an elementary, secondary, or vocational/technical teacher. Instead of the stipend for certification, the program may pay a bonus of up to $10,000 to participants who teach in a high-poverty school. For FY2010, the funding for the program was $14 million.

There are federal employment and training programs and policies specifically targeted to help veterans seeking employment in the civilian economy. Transition assistance programs are operated by the Department of Defense (DOD), the Department of Veterans Affairs (VA), and the Department of Labor (DOL) to assist servicemembers as they prepare to leave the military. DOL operates grant programs to states to provide outreach and assistance to veterans in finding civilian employment. In addition, the federal government has policies (including veterans preference) that assist veterans in obtaining jobs with the federal government and federal contractors. P.L. 112-56 makes several changes to the Transition Assistance Program (TAP) for separating servicemembers and permits a servicemember who is within 120 days of separation from military service to be certified as a preference eligible for federal employment. This report provides a brief overview of these federal programs and policies. This report will be updated as needed.

RS21314 -- International Law and the Preemptive Use of Force Against Iraq Updated April 11, 2003 Until recent decades customary international law deemed the right to use force and even to go to war to be an essentialattribute of every state. As one scholar summarized: It always lies within the power of a State to endeavor to obtain redress for wrongs, or to gain political or other advantages over another, not merely by the employment of force, but also bydirectrecourse to war. (1) Within that framework customary international law also consistently recognized self-defense as a legitimate basis for theuse of force: An act of self-defense is that form of self-protection which is directed against an aggressor or contemplated aggressor. No act can be so described which is not occasioned by attack or fear ofattack. When acts of self-preservation on the part of a State are strictly acts of self-defense, they are permitted by the lawofnations, and are justified on principle, even though they may conflict with the ... rights of otherstates. (2) Moreover, the recognized right of a state to use force for purposes of self-defense traditionally included the preemptive useof force, i.e., the use of force in anticipation of an attack. Hugo Grotius, the father of international law,stated in theseventeenth century that "[i]t be lawful to kill him who is preparing to kill." (3) Emmerich de Vattel a century later similarlyasserted: The safest plan is to prevent evil, where that is possible. A Nation has the right to resist the injury another seeks to inflict upon it, and to use force ... against the aggressor. It may even anticipatetheother's design, being careful, however, not to act upon vague and doubtful suspicions, lest it should run the risk ofbecoming itself the aggressor. (4) The classic formulation of the right of preemptive attack was given by Secretary of State Daniel Webster in connection withthe famous Caroline incident. In 1837 British troops under the cover of night attacked and sank anAmerican ship, the Caroline , in U.S. waters because the ship was being used to provide supplies to insurrectionists againstBritish rule inCanada headquartered on an island on the Canadian side of the Niagara River. The U.S. immediately protested this"extraordinary outrage" and demanded an apology and reparations. The dispute dragged on for several years beforetheBritish conceded that they ought to have immediately offered "some explanation and apology." But in the courseof thediplomatic exchanges Secretary of State Daniel Webster articulated the two conditions essential to the legitimacyof thepreemptive use of force under customary international law. In one note he asserted that an intrusion into the territoryofanother state can be justified as an act of self-defense only in those "cases in which the necessity of that self-defenseisinstant, overwhelming, and leaving no choice of means and no moment for deliberation." (5) In another note he asserted thatthe force used in such circumstances has to be proportional to the threat: It will be for [Her Majesty's Government] to show, also, that the local authorities of Canada, even supposing the necessity of the moment authorized them to enter the territories of theUnitedStates at all, did nothing unreasonable or excessive; since the act, justified by the necessity of self-defence, mustbe limitedby that necessity, and kept clearly within it. (6) Both elements - necessity and proportionality - have been deemed essential to legitimate the preemptive use of force incustomary international law. (7) However, with the founding of the United Nations, the right of individual states to use force was purportedly curbed. TheCharter of the UN states in its Preamble that the UN was established "to save succeeding generations from thescourge ofwar"; and its substantive provisions obligate Member States of the UN to "settle their international disputes bypeacefulmeans" (Article 2(3)) and to "refrain in their international relations from the threat or use of force against theterritorialintegrity or political independence of any State, or in any manner inconsistent with the Purposes of the UnitedNations"(Article 2(4)). In place of the traditional right of states to use force, the Charter creates a system of collectivesecurity inwhich the Security Council is authorized to "determine the existence of any threat to the peace, breach of the peace,or actof aggression" and to "decide what measures shall be taken ... to maintain international peace and security" (Article39). Although nominally outlawing most uses of force in international relations by individual States, the UN Charter doesrecognize a right of nations to use force for the purpose of self-defense. Article 51 of the Charter provides: Nothing in the present Charter shall impair the inherent right of individual or collective self-defence if an armed attack occurs against a Member of the United Nations, until the Security Councilhastaken measures necessary to maintain international peace and security. (8) The exact scope of this right of self-defense, however, has been the subject of ongoing debate. Read literally, Article 51'sarticulation of the right seems to preclude the preemptive use of force by individual states or groupings of states andtoreserve such uses of force exclusively to the Security Council. Measures in self-defense, in this understanding, arelegitimate only after an armed attack has already occurred. (9) Others contend that Article 51 should not be construed so narrowly and that "it would be a travesty of thepurposes of theCharter to compel a defending state to allow its assailant to deliver the first, and perhaps fatal, blow ...." (11) To read Article51 literally, it is said, "is to protect the aggressor's right to the first strike." (12) Consequently, to avoid this result, someassert that Article 51 recognizes the "inherent right of individual or collective self-defence" as it developed incustomaryinternational law prior to adoption of the Charter and preserves it intact. The reference to that right not beingimpaired "ifan armed attack occurs against a Member of the United Nations," it is said, merely emphasizes one importantsituationwhere that right may be exercised but does not exclude or exhaust other possibilities. (13) In further support of this view, it is argued that the literal construction of Article 51 simply ignores the reality that the ColdWar and other political considerations have often paralyzed the Security Council and that, in practice, states havecontinuedto use force preemptively at times in the UN era and the international community has continued to evaluate thelegitimacyof those uses under Article 51 by the traditional constraints of necessity and proportionality. The followingexamplesillustrate several aspects of these contentions: In 1962 President Kennedy, in response to photographic evidence that the Soviet Union was installing medium range missiles in Cuba capable of hitting the United State, imposed a naval "quarantine" on Cuba in order"tointerdict ... the delivery of offensive weapons and associated material." (14) Although President Kennedy said that thepurpose of the quarantine was "to defend the security of the United States," the U.S. did not rely on the legal conceptofself-defense either as articulated in Article 51 or otherwise as a justification for its actions. Abram Chayes, theLegalAdviser to the State Department at that time, later explained the decision not to rely on that justification asfollows: In retrospect ... I think the central difficulty with the Article 51 argument was that it seemed to trivialize the whole effort at legal justification. No doubt the phrase "armed attack" must beconstruedbroadly enough to permit some anticipatory response. But it is a very different matter to expand it to includethreateningdeployments or demonstrations that do not have imminent attack as their purpose or probable outcome. To acceptthatreading is to make the occasion for forceful response essentially a question for unilateral national decision thatwould notonly be formally unreviewable, but not subject to intelligent criticism, either .... Whenever a nation believed thatinterests,which in the heat and pressure of a crisis it is prepared to characterize as vital, were threatened, its use of force inresponsewould become permissible .... In this sense, I believe that an Article 51 defence would have signalled that theUnited Statesdid not take the legal issues involved very seriously, that in its view the situation was to be governed by nationaldiscretion,not international law. (15) In 1967 Israel launched a preemptive attack on Egypt and other Arab states after President Nasser had moved his army across the Sinai toward Israel, forced the UN to withdraw its peacekeeping force from the Sinaiborder, andclosed the port of Aqaba to Israeli shipping, and after Syria, Iraq, Jordan, and Saudi Arabia all began moving troopsto theborders of Israel. In six days it routed Egypt and its Arab allies and had occupied the Sinai Peninsula, the WestBank, andthe Gaza Strip. Israel claimed its attack was defensive in nature and necessary to forestall an Arab invasion. BoththeSecurity Council and the General Assembly rejected proposals to condemn Israel for its "aggressive"actions. (16) On June 7, 1981, Israel bombed and destroyed a nuclear reactor under construction in Iraq. Assertingthat Iraq considered itself to be in a state of war with Israel, that it had participated in the three wars with Israel in1948,1967, and 1973, that it continued to deny that Israel has a right to exist, and that its nuclear program was for thepurpose ofdeveloping weapons capable of destroying Israel, Israel claimed that "in removing this terrible nuclear threat to itsexistence, Israel was only exercising its legitimate right of self-defense within the meaning of this term ininternational lawand as preserved also under the United Nations Charter." (17) Nonetheless, the Security Council unanimously "condemn[ed]the military attack by Israel in clear violation of the Charter of the United Nations and the norms of internationalconduct"and urged the payment of "appropriate redress." (18) Thus, in both theory and practice the preemptive use of force appears to have a home in current international law. Itsclearest legal foundation is in Chapter VII of the UN Charter. Under Article 39 the Security Council has theauthority todetermine the existence not only of breaches of the peace or acts of aggression that have already occurred but alsoof threatsto the peace; and under Article 42 it has the authority to "take such action by air, sea, or land forces as may benecessary tomaintain or restore international peace and security." These authorities clearly seem to encompass the possibilityof thepreemptive use of force. Less clear is whether international law currently allows the preemptive use of force by anation orgroup of nations without Security Council authorization. That would seem to be permissible only if Article 51 is read notliterally but as preserving the use of force in self-defense as traditionally allowed in customary international law. As noted,the construction of Article 51 remains a matter of debate. But so construed, Article 51 would not preclude thepreemptiveuse of force by the U.S. against Iraq or other sovereign nations. To be lawful, however, such uses of force wouldneed tomeet the traditional requirements of necessity and proportionality. As the examples listed above illustrate, the requirement of necessity is most easily met when an armed attack is clearlyimminent, as in the case of the Arab-Israeli War of 1967. But beyond such obvious situations, as Abram Chayesargued,the judgment of necessity becomes increasingly subjective; and there is at present no consensus either in theory orpracticeabout whether the possession or development of weapons of mass destruction (WMD) by a rogue state justifies thepreemptive use of force. Most analysts recognize that if overwhelmingly lethal weaponry is possessed by a nationwillingto use that weaponry directly or through surrogates (such as terrorists), some kind of anticipatory self-defense maybe amatter of national survival; and many - including the Bush Administration - contend that international law oughtto allow,if it does not already do so, for the preemptive use of force in that situation. (19) But many states and analysts are decidedlyreluctant to legitimate the preemptive use of force against threats that are only potential and not actual on thegrounds thejustification can easily be abused. Moreover, it remains a fact that the international community judged Israel'sdestructionof Iraq's nuclear reactor site in 1981 to be an aggressive act rather than an act of self-defense. Iraq has become an occasion to revisit the issue. Iraq had not attacked the U.S., nor did it appear to pose an imminent threatof attack in traditional military terms. As a consequence, it seems doubtful that the use of force against Iraq couldbedeemed to meet the traditional legal tests justifying preemptive attack. But Iraq may have possessed WMD, andit mayhave had ties to terrorist groups that seek to use such weapons against the U.S. If evidence is forthcoming on bothof thoseissues, then the situation necessarily raises the question that the Bush Administration articulated in its nationalsecuritystrategy, i.e. , whether the traditional law of preemption ought to be recast in light of the realities ofWMD, rogue states, andterrorism. Iraq likely will not resolve that question, but it is an occasion to crystallize the debate.

On March 19, 2003, the United States, aided by Great Britain and Australia,initiated a military invasion of Iraq. Both the U.S. and Great Britain contended that they had sufficient legalauthority touse force against Iraq pursuant to Security Council resolutions adopted in 1990 and 1991. But President Bush alsocontended that, given the "nature and type of threat posed by Iraq," the U.S. had a legal right to use force "in theexercise ofits inherent right of self defense, recognized in Article 51 of the UN Charter." Given that the U.S. had notpreviously beenattacked by Iraq, that contention raised questions about the permissible scope of the preemptive use of force underinternational law. This report examines that issue as it has developed in customary international law and under theUnitedNations Charter. It will be updated as events warrant. (For historical information on the preemptive use of forceby theU.S., see CRS Report RS21311, U.S. Use of Preemptive Military Force.)

The Americans with Disabilities Act (ADA) is a broad civil rights act prohibiting discrimination against individuals with disabilities. As stated in the act, its purpose is "to provide a clear and comprehensive national mandate for the elimination of discrimination against individuals with disabilities." In 2008, Congress enacted the ADA Amendments Act (ADAAA), P.L. 110-325 , to address Supreme Court decisions which interpreted the definition of disability narrowly. On September 23, 2009, the Equal Employment Opportunity Commission (EEOC) issued proposed regulations under the ADA Amendments Act. Comments on the proposed regulations must be submitted on or before November 23, 2009. Prior to a discussion of the proposed regulations, it is helpful to briefly examine the new statutory definition of disability. The ADAAA defines the term disability with respect to an individual as "(A) a physical or mental impairment that substantially limits one or more of the major life activities of such individual; (B) a record of such an impairment; or (C) being regarded as having such an impairment (as described in paragraph (3))." Although this is essentially the same statutory language as was in the original ADA, P.L. 110-325 contains new rules of construction regarding the definition of disability, which provide that the definition of disability shall be construed in favor of broad coverage to the maximum extent permitted by the terms of the act; the term "substantially limits" shall be interpreted consistently with the findings and purposes of the ADA Amendments Act; an impairment that substantially limits one major life activity need not limit other major life activities to be considered a disability; an impairment that is episodic or in remission is a disability if it would have substantially limited a major life activity when active; and the determination of whether an impairment substantially limits a major life activity shall be made without regard to the ameliorative effects of mitigating measures, except that the ameliorative effects of ordinary eyeglasses or contact lenses shall be considered. The ADA Amendments Act, which states that the definition of disability shall be construed broadly, and which specifically rejects portions of the EEOC's ADA regulations, necessitated regulatory changes. The major changes made to the regulations include specific examples of impairments that will consistently meet the definition of disability, changes in the definition of the term "substantially limits," and expansion of the definition of "major life activity" including changes to the concept of the major life activity of working. The EEOC also amended its interpretative guidance for Title I of the ADA. The ADA definition of disability is a functional definition, not a categorical definition. The EEOC's proposed regulatory definition reiterates the statutory definition and provides guidance on its interpretation. Noting that "disability is determined based on an individualized assessment," the EEOC provides examples of impairments that will consistently meet the definition of disability, and examples of impairments that may be disabling for some individuals but not for others. The EEOC notes that these lists are illustrative, and other types of impairments that are not listed may consistently meet the definition of disability. Examples are also provided of impairments that are usually not disabilities. EEOC states that the following listed impairments will consistently meet the definition of disability: autism, cancer, cerebral palsy, diabetes, epilepsy, HIV or AIDS, multiple sclerosis and muscular dystrophy, major depression, bipolar disorder, post-traumatic stress disorder, obsessive compulsive disorder, and schizophrenia. The EEOC examples of impairments that may be disabling for some individuals but not for others include the following: asthma, high blood pressure, learning disabilities, back or leg impairments, carpal tunnel syndrome, and hyperthyroidism. "Temporary, non-chronic impairments of short duration with little or no residual effects (such as the common cold, seasonal or common influenza, a sprained joint, minor and not-chronic gastrointestinal disorders, or a broken bone that is expected to heal completely) usually will not substantially limit a major life activity." EEOC's listing of specific impairments that "will consistently meet the definition of disability" could arguably be seen as contrary to the ADA's statutory definition. One commentator contends that this may mean that an employer would have no argument against coverage of the listed disabilities and, therefore, this approach is contrary to the ADA's individualized assessment approach. However, the EEOC appendix to the proposed regulations notes that, under the ADA, disability is determined based on an individualized assessment, and that the proposed regulation "recognizes, and offers examples to illustrate, that characteristics associated with some types of impairments allow an individualized assessment to be conducted quickly and easily, and will consistently render those impairments disabilities." It is also interesting to note that in its list of conditions that will usually not substantially limit a major life activity, the EEOC included seasonal or common influenza. It did not discuss whether pandemic influenza would be covered. However, in separate guidance, the EEOC found that H1N1, as currently experienced, would not be interpreted as a disability. The ADA Amendments Act states that the purposes of the legislation are to carry out the ADA's objectives of the elimination of discrimination and the provision of "'clear, strong, consistent, enforceable standards addressing discrimination' by reinstating a broad scope of protection available under the ADA." P.L. 110-325 rejects the Supreme Court's holdings that mitigating measures are to be used in making a determination of whether an impairment substantially limits a major life activity as well as holdings defining the "substantially limits" requirements. The substantially limits requirements of Toyot a Motor Manufacturing v. Williams , as well as the existing EEOC regulations defining substantially limits as "significantly restricted," are specifically rejected in the new law. The current EEOC regulations state that three factors should be considered in determining whether an individual is substantially limited in a major life activity: the nature and severity of the impairment, the duration or expected duration of the impairment, and the permanent or long-term impact of the impairment. The proposed regulations do not contain these factors. They state that an impairment is a disability "if it substantially limits the ability of an individual to perform a major life activity as compared to most people in the general population. An impairment need not prevent, or significantly or severely restrict, the individual from performing a major life activity in order to be considered a disability." The Senate Managers' Statement for the ADAAA discussed the meaning of substantially limited and, after quoting from the committee report for the original 1990 ADA, stated, "We particularly believe that this test, which articulated an analysis that considered whether a person's activities are limited in condition, duration and manner, is a useful one." It could be argued that the EEOC's proposed regulations do not conform with congressional intent. The EEOC, in its proposed appendix to the proposed regulations, notes that the Senate Managers' Report does make reference to the "condition, duration and manner" analysis, but argues that congressional intent to override the Supreme Court's Toyota decision is best served by an elimination of this analysis. The House debate contains a colloquy between Representatives Pete Stark and George Miller on the subject of the meaning of "substantially limits" in the context of learning, reading, writing, thinking, or speaking. The colloquy finds that an individual who has performed well academically may still be considered an individual with a disability. Representative Stark stated the following: Specific learning disabilities, such as dyslexia, are neurologically based impairments that substantially limit the way these individuals perform major life activities, like reading or learning, or the time it takes to perform such activities often referred to as the condition, manner, or duration. This legislation will reestablish coverage for these individuals by ensuring that the definition of this disability is broadly construed and the determination does not consider the use of mitigating measures. The EEOC's proposed regulations echo this colloquy, specifically stating the following: An individual with a learning disability who is substantially limited in reading, learning, thinking, or concentrating compared to most people, as indicated by the speed or ease with which he can read, the time and effort required for him to learn, or the difficulty he experiences in concentrating or thinking, is an individual with a disability, even if he has achieved a high level of academic success, such as graduating from college. The determination of whether an individual has a disability does not depend on what an individual is able to do in spite of an impairment. The ADA Amendments Act specifically lists examples of major life activities including caring for oneself, performing manual tasks, seeing, hearing, eating, sleeping, walking, standing, lifting, bending, speaking, breathing, learning, reading, concentrating, thinking, communicating, and working. The act also states that a major life activity includes the operation of a major bodily function. The House Judiciary Committee report indicates that "this clarification was needed to ensure that the impact of an impairment on the operation of major bodily functions is not overlooked or wrongly dismissed as falling outside the definition of 'major life activities' under the ADA." There had been judicial decisions which found that certain bodily functions had not been covered by the definition of disability. For example, in Furnish v. SVI Sys., Inc. the Seventh circuit held that an individual with cirrhosis of the liver due to infection with Hepatitis B was not an individual with a disability because liver function was not "integral to one's daily existence." The proposed EEOC regulations echo the statutory listing of major life activities and add sitting, reaching, and interacting with others, noting that this list is illustrative, not exhaustive. The House Education and Labor Committee report provided examples for major life activities that were not included in the statutory language, and included reaching and interacting with others. The House report also included examples not in the proposed regulations: writing, engaging in sexual activities, drinking, chewing, swallowing, and applying fine motor coordination. The ADA Amendments Act includes working as an example of a major life activity. What it means to be substantially limited in the major life activity of working is also addressed by the EEOC's proposed regulations. The EEOC notes that usually an individual with a disability will be substantially limited in another major life activity so that it would be unnecessary to determine whether the individual was substantially limited regarding working. However, where that is not the case, the EEOC proposes that "[a]n impairment substantially limits the major life activity of working if it substantially limits an individual's ability to perform, or to meet the qualifications for, the type of work at issue." The EEOC also states that this interpretation is to be construed broadly and should "not demand extensive analysis." "Type of work" is described in the EEOC's proposed appendix as including "the job the individual has been performing or for which he is applying, and jobs that have qualifications or job-related requirements which the individuals would be substantially limited in performing as a result of the impairment." Prior to the enactment of the ADAAA, some courts had required a statistical analysis of the availability of certain jobs in order to determine whether an individual was substantially limited in the major life activity of working. The EEOC states that this statistical analysis will no longer be needed. Using the proposed "type of work" standard, the EEOC envisions courts using evidence from the individual regarding his or her educational and vocational background and the limitations of the impairment. Generally, the EEOC would not consider necessary expert testimony concerning the types of jobs in which an individual is substantially limited. As discussed, the terms "class of jobs" and "broad range of jobs in various classes," which are in the existing regulations, are eliminated in the proposed regulation in favor of the term "type of work." The EEOC describes this change as "more straightforward and easier to understand" as well as being consistent with congressional intent for broad coverage. However, this change has been described as "the most problematic issue arising from the EEOC's proposed regulations" since it is not predicated on specific statutory language or legislative history. It could be argued, as EEOC notes, that the change is consistent with congressional intent that the focus of an ADA case should be on whether discrimination has occurred, not on whether the individual has met the definition of disability. Such a change in the regulations could have a significant effect on judicial determinations.

The Americans with Disabilities Act (ADA) is a broad civil rights act prohibiting discrimination against individuals with disabilities. As stated in the act, its purpose is "to provide a clear and comprehensive national mandate for the elimination of discrimination against individuals with disabilities." In 2008, Congress enacted the ADA Amendments Act (ADAAA), P.L. 110-325, to address Supreme Court decisions which interpreted the definition of disability narrowly. On September 23, 2009, the Equal Employment Opportunity Commission (EEOC) issued proposed regulations under the ADA Amendments Act. Comments on the proposed regulations must be submitted on or before November 23, 2009. The ADA Amendments Act, which states that the definition of disability shall be construed broadly and which specifically rejects portions of the EEOC's ADA regulations, necessitated regulatory changes. The major changes made to the regulations include specific examples of impairments that will consistently meet the definition of disability, changes in the definition of the term "substantially limits," and expansion of the definition of "major life activity" including changes to the concept of the major life activity of working. The EEOC also amended its interpretative guidance for Title I of the ADA.

The Berne Union represents a diverse group of public and private entities that are directly involved in international trade and foreign investment by providing financing and insurance to exporters and investors. The activities of Berne Union members are diversified across products, geographies, governance modes, and regulatory systems. In 2011, Berne Union members provided over $1.8 trillion in insurance coverage, representing more than 10% of total global trade. The Berne Union was formed in 1934 when private and state export credit insurers from France, Italy, Spain, and the United Kingdom met in Berne, Switzerland. As a result, the organization was named after the location of the first meeting, thus the name the Berne Union, although the organization has never been based in Berne. The Union was headquartered in Paris until the 1970s, when it was moved to London. Associated with the Berne Union is the Prague Club, which was established in 1993 by the Berne Union and the European Bank for Reconstruction and Development (EBRD) to support new and maturing export credit agencies that are setting up and developing export credit and investment insurance programs. Also named after the location where the first meeting was held, the Prague Club established an information exchange network for new agencies in Central and Eastern Europe that have not yet meet the entrance requirements for Berne Union members. When the Prague Club members have grown to the point where they can meet certain specified criteria, they can apply for full Berne Union membership. Membership in the Berne Union is open to new applicants but there are requirements that must be met to ensure that discussions among the members remain relevant and topical for as many members as possible. Membership requirements include Institutions applying for membership in the Berne Union should be underwriters actively conducting business in the areas of export credit financing and foreign investment as their core activity. Institutions must have been in operation in the field of export credit insurance or the insurance of outward investment for a period of at least three years. Institutions should meet certain thresholds for premium income or for the value of business covered. If the applicant is engaged in export credit insurance, its operations must include insurance of both commercial and political risks and it must underwrite political risks in a global and general sense. If the applicant is engaged in the insurance of outward investment, it must be providing direct insurance against the normal political risks, including expropriation and war, and issues associated with the transfer of funds. Applicants to the Berne Union are assigned observer status for two years, after which the membership of the Berne Union decides collectively if the applicant can become a full member. In the past five years, more than 10 new members have joined the Berne Union and 3 applicants are presently listed in the observer status. In 2007, the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC) became the newest member of the Berne Union. The United States is represented within the Berne Union by two federal government agencies—the U.S. Export-Import Bank and the Overseas Private Investment Company —and five private sector corporations. The private-sector members are the American International Group insurance underwriters (AIG); the Chubb Corporation of Warren, New Jersey; the Foreign Credit Insurance Association Management Company, Inc. (FCIA); the Multilateral Investment Guarantee Agency (MIGA); and the Zurich Emerging Markets Solution. The Berne Union is led by a President, a Vice President, and a Management Committee. The President is elected each year and can be re-elected for one further year. The Vice President is elected each year and cannot be re-elected. The Management Committee consists of the President, the Vice President, Committee Chairs, and 12 representatives of member organizations. The standing committees represent three areas of specialization within the credit industry: short-term credit insurance represented by the Short Term (ST) Committee, medium- and long-term credit insurance and lending represented by the Medium Long Term (MLT) Committee, and investment insurance represented by the Investment (INV) Committee. Six of the members for the Management Committee represent the two largest organizations in each of the three committees. The remaining six members are elected on a rotating basis for a two-year term. To support the Berne Union leadership, the Berne Union has a staff of five people, known as the Secretariat, located in London. These five staff members are responsible for coordinating all Berne Union and Prague Club activities and for providing ways for the members to participate. In particular, the Secretariat is responsible for maintaining external relations and for promoting the Berne Union and its members within the export credit and insurance industry as a whole by supporting opportunities for members to meet and discuss professional matters and to exchange views and experiences. This interchange of information is achieved through three methods, annual general meetings and Committee meetings, annual seminars and workshops, and an intranet among the Berne Union members. Annual general meetings are hosted by a Berne Union member on a rotating basis and take place over four or five days. Discussions at these meetings reflect broad aspects of international trade, international finance, and developments in specific industry sectors. In particular, member discussions focus on developing and promoting the best available practices in the fields of international trade finance and foreign investment insurance. Recently, the members focused their attention on such issues as the impact of the global credit crunch and the effect it is having on global trade; the dynamic expansion of the Indian economy and the growing demand for credit insurance; and trends in social and corporate responsibility, green initiatives in project finance, and the expanding capacity for local currency finance. The Berne Union has developed long-standing relationships with the leading international and regional financial institutions in the credit and investment insurance industry. For instance, the Union has developed strong ties with such groups as the Organization for Economic Cooperation and Development (OECD), the International Monetary Fund (IMF), and the World Bank group, and has worked closely with these organizations to promote international financial stability and broad-based economic growth. The Berne Union is also in regular contact with such regional development banks as the European Bank of Reconstruction and Development (EBRD) and the Asian Development Bank, as agencies from both regions are active members of the Prague Club. The Berne Union has close relationships with the other major credit insurance associations including the International Credit Insurance and Surety Association (ICISA) and the Pan-American Surety Association (PASA). According to Berne Union President Johan Schrijver, the financial crisis has presented suppliers of exports and export insurance with severe challenges as liquidity has been tight and the volume of global trade fell sharply. In addition, risk concerns have shifted from focusing primarily on developing countries to developed economies and the sovereign debt crisis in Europe and the political instability in the Middle East. Berne Union members expect the rate of economic growth to slow down in 2012, which could place pressure on official export credit agencies to provide additional support. According to Johan Schrijver, Berne Union members "continue to express serious concerns about the ability of banks to fund trade and investment given the proposed regulatory changes and the on-going funding challenges that banks are facing. Any further deterioration in bank capacity for trade and export finance could have serious consequences for global trade and economic recovery." Berne Union members have participated in conferences and other forums where they have encouraged the continued availability of export credits and trade and investment insurance to support the positive effects of global trade and investment. At the same time, Berne Union members continue to support practices that emphasize ethical practices in international trade. Berne Union members have adopted operational guidelines in the three major business areas to support best practices among all of the members. Denmark's Eksport Kredit Fonden (EKF) adopted a set of principles known as the Equator Principles that comprise a voluntary set of guidelines associated with project finance that are based on the environmental and social procedures developed by the World Bank's International Finance Corporation and that have been adopted by various international banks. Berne Union members have also met with business leader throughout Asia to overcome concerns about doing business in Asia, particularly in China. Some members argue that there is a lack of available information concerning the nature and performance capability of many of the firms in China that are involved in trade or investment transactions with Berne Union members. The rapid growth of joint ventures with Chinese firms has created confusion at times for some of the public-sector Berne Union members, because many of them are charged by their respective governments with participating in transactions that support economic activity in their home countries. As a result of this confusion, membership in the Berne Union is growing fastest among firms from the private sector where those firms are not charged with promoting national content. Another key issue for Berne Union members is insurance against terrorist risks and how such risks should be defined and whether they should be included as a part of investment insurance. In November 2006, the Berne Union members adopted a set of 10 Guiding Principles, which represents a set of best practices commitments for Berne Union members to operate "in a professional manner that is financially responsible, respectful of the environment and which demonstrates high ethical values." In brief terms, the 10 Principles are commitments to: 1. Conduct business in a manner that contributes to the stability and expansion of global trade and investment in accordance with applicable laws and relevant international agreements. 2. Carefully review and manage the risks that are undertaken. 3. Promote export credit and investment insurance terms that reflect sound business practices. 4. Generate adequate revenues to sustain long-term operations that are reflective of the risks that are undertaken. 5. Manage claims and recoveries in a professional manner, while recognizing the rights of insurers and obligors. 6. Be sensitive about environmental issues and take such issues into account in the conduct of business. 7. Support international efforts to combat corruption and money laundering. 8. Promote best practices through exchange of information, policies, and procedures, and through the development of relevant agreements and standards, where these are deemed necessary. 9. Commit to furthering transparency amongst members and in the reporting of business practices. 10. Encourage cooperation and partnering with commercial, bilateral, multilateral, and other organization involved in export trade and investment business. Congress plays no direct role in the Berne Union, but its presence is felt indirectly through two U.S. government agencies that are members of the Union and over which it has oversight responsibility—the U.S. Export-Import Bank and the Overseas Private Investment Corporation. These agencies also provide information back to Congress and to the Administration about developments in the areas of export credit finance and foreign investment. U.S. private sector firms that are members of the Berne Union also often look to Congress for support and leadership in the areas of export credit finance and insurance, especially with the increased risks many firms now believe exist as a result of terrorist activities. As a result of its vast international economic and security interests, the United States is directly affected by, and therefore plays a leading role in, developments in the areas of international trade, international finance, and foreign investment. The vast U.S. international presence also means that U.S. national interests are tied to the successful operation and stability of the international trade and finance markets, which means that Congress is often involved in resolving issues that affect important U.S. interests that rely on stability in the international financial system and the successful operation of global trade and investment markets.

The Berne Union, or the International Union of Credit and Investment Insurers, is an international organization comprised of more than 70 public and private sector members that represent both public and private segments of the export credit and investment insurance industry. Members range from highly developed economies to emerging markets, from diverse geographical locations, and from a spectrum of viewpoints about approaches to export credit financing and investment insurance. Within the Berne Union, the United States is represented by the U.S. Export-Import Bank (Eximbank) and the Overseas Private Investment Corporation (OPIC) and four private-sector firms and by one observer. The main role of the Berne Union and its affiliated group, the Prague Club, is to work to facilitate cross-border trade by helping exporters mitigate risks through promoting internationally acceptable principles of export credit financing, strengthen the global financial structure, and facilitate foreign investments. Over the past decade, the growth and increased importance of global trade and financing have altered the agenda of the Berne Union from focusing primarily on concerns over country-specific political risk to concerns about global trade, international finance, global and regional security, and questions of business organization, civil society, transparency, and corporate responsibility. The 2008-2009 financial crisis and the economic recession that followed has altered export financing by making credit conditions tighter and by raising concerns over risks in the advanced economies. As a result, demands on official export credits have grown sharply. Congress, through its oversight of Eximbank and OPIC, as well as international trade and finance, has interests in the functioning of the Berne Union.

In the wake of the tragedy of September 11, 2001, the U.S. Congress decided that enhancing the security of the United States' borders was a vitally important component of preventing future terrorist attacks. Before September 11, 2001, border security fell piecemeal under the mandate of many diverse federal departments, including but not limited to the Department of Justice (the Immigration and Naturalization Service); the Department of the Treasury (the Customs Service); the Department of Agriculture (the Animal and Plant Health Inspection Service); and the Department of Transportation (the Coast Guard). The Homeland Security Act of 2002 ( P.L. 107-296 ) consolidated most federal agencies operating along the U.S. borders within the newly formed DHS. Most of these agencies were located in the Directorate of Border and Transportation Security (BTS), which was charged with securing the borders; territorial waters; terminals; waterways; and air, land, and sea transportation systems of the United States; and managing the nation's ports of entry. The lone exception is the U.S. Coast Guard, which remained a standalone division within DHS. The BTS was composed of three main agencies: (1) the CBP, which is charged with overseeing commercial operations, inspections, and land border patrol functions, (2) ICE, which oversees investigations, alien detentions and removals, air/marine drug interdiction operations, and federal protective services, and (3) the TSA, which is charged with protecting the nation's air, land, and rail transportation systems against all forms of attack to ensure freedom of movement for people and commerce. On July 13, 2005, the Secretary of DHS, Michael Chertoff, announced the results of the months-long Second Stage Review (2SR) that he undertook upon being confirmed as DHS Secretary. One of Secretary Chertoff's main recommendations, which was agreed to by the DHS Appropriations Conferees, was the elimination of the BTS Directorate. The Secretary announced the creation of a new Office of Policy, which, among other things, assumed the policy coordination responsibilities of the BTS Directorate. The operational agencies that comprised BTS (CBP, ICE, TSA) now report directly to the Secretary and Deputy Secretary of DHS. The goal of this reorganization was to streamline the policy creation process and ensure that DHS policies and regulations are consistent across the department. Additionally, the Federal Air Marshals program was moved out of ICE and back into TSA to increase operational coordination between all aviation security entities in the department. Conceptually speaking, CBP provides the front line responders to immigrations and customs violations and serves as the law enforcement arm of DHS, while ICE serves as the investigative branch. TSA is charged with securing the nation's transportation systems, whereas the U.S. Coast Guard also serves an important border security function by patrolling the nation's territorial and adjacent international waters against foreign threats. Combined FY2010 appropriations for the border security agencies of DHS equaled $30.96 billion, and the combined full time equivalent (FTE) manpower totaled approximately 180,142 employees. CBP combined portions of the previous border law enforcement agencies under one administrative umbrella. This involved absorbing employees from the Immigration and Naturalization Service (INS), the Border Patrol, the Customs Service, and the Department of Agriculture. CBP's mission is to prevent terrorists and terrorist weapons from entering the country, provide security at U.S. borders and ports of entry, apprehend illegal immigrants, stem the flow of illegal drugs, and protect American agricultural and economic interests from harmful pests and diseases. As it performs its official missions, CBP maintains two overarching and sometimes conflicting goals: increasing security while facilitating legitimate trade and travel. In FY2010, CBP's appropriated net budget authority totaled $10.13 billion and manpower totaled approximately 58,105 FTE. Between official ports of entry, the U.S. Border Patrol (USBP)—a component of CBP—enforces U.S. immigration law and other federal laws along the border. As currently comprised, the USBP is the uniformed law enforcement arm of the Department of Homeland Security. Its primary mission is to detect and prevent the entry of terrorists, weapons of mass destruction, and unauthorized aliens into the country, and to interdict drug smugglers and other criminals. In the course of discharging its duties the USBP patrols over 8,000 miles of our international borders with Mexico and Canada and the coastal waters around Florida and Puerto Rico. At official ports of entry, CBP officers are responsible for conducting immigrations, customs, and agricultural inspections on entering aliens. As a result of the "one face at the border" initiative, CBP inspectors are being cross-trained to perform all three types of inspections in order to streamline the border crossing process. This initiative unifies the prior inspections processes, providing entering aliens with one primary inspector who is trained to determine whether a more detailed secondary inspection is required. CBP inspectors enforce immigration law by examining and verifying the travel documents of incoming international travelers to ensure they have a legal right to enter the country. On the customs side, CBP inspectors ensure that all imports and exports comply with U.S. laws and regulations, collect and protect U.S. revenues, and guard against the smuggling of contraband. Additionally, CBP is responsible for conducting agricultural inspections at ports of entry in order to enforce a wide array of animal and plant protection laws. In order to carry out these varied functions, CBP inspectors have a broad range of powers to inspect all persons, vehicles, conveyances, merchandise, and baggage entering the United States from a foreign country. ICE merged the investigative functions of the former INS and the Customs Service, the INS detention and removal functions, most INS intelligence operations, and the Federal Protective Service (FPS). This makes ICE the principal investigative arm for DHS. ICE's mission is to detect and prevent terrorist and criminal acts by targeting the people, money, and materials that support terrorist and criminal networks. As such they are an important component of our nation's border security network even though their main focus is on interior enforcement. In FY2010, ICE appropriations totaled $5.44 billion, and the agency had approximately 20,134 FTE employees. Unlike CBP, whose jurisdiction is confined to law enforcement activities along the border, ICE special agents investigate immigrations and customs violations in the interior of the United States. ICE's mandate includes uncovering national security threats such as weapons of mass destruction or potential terrorists, identifying criminal aliens for removal, probing immigration-related document and benefit fraud, investigating work-site immigration violations, exposing alien and contraband smuggling operations, interdicting narcotics shipments, and detaining illegal immigrants and ensuring their departure (or removal) from the United States. ICE is also responsible for the collection, analysis and dissemination of strategic and tactical intelligence data pertaining to homeland security, infrastructure protection, and the illegal movement of people, money, and cargo within the United States. The Coast Guard was incorporated into DHS as a standalone agency by P.L. 107-296 . The Coast Guard's overall mission is to protect the public, the environment, and U.S. economic interests in maritime regions—at the nation's ports and waterways, along the coast, and in international waters. The Coast Guard is thus the nation's principal maritime law enforcement authority and the lead federal agency for the maritime component of homeland security, including port security. Among other things, the Coast Guard is responsible for evaluating, boarding, and inspecting commercial ships as they approach U.S. waters; countering terrorist threats in U.S. ports; and for helping to protect U.S. Navy ships in U.S. ports. A high-ranking Coast Guard officer in each port area serves as the Captain of the Port and is the lead federal official responsible for the security and safety of the vessels and waterways in their geographic zone. In FY2010, Coast Guard appropriated budget authority totaled $10.14 billion, and the agency had approximately 49,954 FTE military and civilian employees. As part of Operation Noble Eagle (military operations in homeland defense and civil support to U.S. federal, state and local agencies), the Coast Guard is at a heightened state of alert protecting more than 361 ports and 95,000 miles of coastline. The Coast Guard's homeland security role includes protecting ports, the flow of commerce, and the marine transportation system from terrorism; maintaining maritime border security against illegal drugs, illegal aliens, firearms, and weapons of mass destruction; ensuring that the U.S. can rapidly deploy and resupply military assets by maintaining the Coast Guard at a high state of readiness as well as by keeping marine transportation open for the other military services; protecting against illegal fishing and indiscriminate destruction of living marine resources; preventing and responding to oil and hazardous material spills; and coordinating efforts and intelligence with federal, state, and local agencies. The TSA was created as a direct result of the events of September 11 and is charged with protecting the United States' air, land, and rail transportation systems to ensure freedom of movement for people and commerce. The Aviation and Transportation Security Act (ATSA, P.L. 107-71 ) created the TSA and included provisions that established a federal baggage screener workforce, required checked baggage to be screened by explosive detection systems, and significantly expanded FAMS. In 2002, TSA was transferred to the newly formed DHS from the Department of Transportation; as previously noted, in 2003 the Federal Air Marshal program was taken out of TSA and transferred to ICE. In FY2006, the program was transferred back to TSA. In FY2010, TSA appropriations totaled $5.26 billion, and the agency had approximately 51,949 FTE employees. To achieve its mission of securing the nation's aviation, TSA assumed responsibility for screening air passengers and baggage—a function that had previously resided with the air carriers. TSA is also charged with ensuring the security of air cargo and overseeing security measures at airports to limit access to restricted areas, secure airport perimeters, and conduct background checks for airport personnel with access to secure areas, among other things. However, an opt out provision in ATSA will permit every airport with federal screeners to request a switch to private screeners commencing in November 2004. Additionally, as a result of the 2SR, the Federal Air Marshals program has been transferred back to TSA. FAMS is responsible for detecting, deterring and defeating hostile acts targeting U.S. air carriers, airports, passengers and crews by placing undercover armed agents in airports and on flights. This report has briefly outlined the roles and responsibilities of the four main agencies within the DHS charged with securing our nation's borders: the CBP, ICE, the U.S. Coast Guard, and the TSA. It should be noted, however, that although the Homeland Security Act of 2002 consolidated all the agencies with primary border security roles in DHS, many other federal agencies are involved in the difficult task of securing our nation's borders. Although border security may not be in their central mission, they nevertheless provide important border security functions. These agencies include, but are not limited to the U.S. Citizenship and Immigrations Services within DHS, which processes permanent residency and citizenship applications, as well as asylum and refugee processing; the Department of State, which is responsible for visa issuances overseas; the Department of Agriculture, which establishes the agricultural policies that CBP Inspectors execute; the Department of Justice, whose law enforcement branches (the Federal Bureau of Investigation and Drug Enforcement Agency) coordinate with CBP and ICE agents when their investigations involve border or customs violations; the Department of Health and Human Services, through the Food and Drug Administration and the Center for Disease Control; the Department of Transportation, whose Federal Aviation Administration monitors all airplanes entering American air space from abroad; the Treasury Department, whose Bureau of Alcohol, Tobacco, and Firearms investigates the smuggling of guns into the country; and lastly the Central Intelligence Agency, which is an important player in the efforts to keep terrorists and other foreign agents from entering the country. Additionally, due to their location, state and local responders from jurisdictions along the Canadian and Mexican borders also play a significant role in the efforts to secure our nation's borders.

After the massive reorganization of federal agencies precipitated by the creation of the Department of Homeland Security (DHS), there are now four main federal agencies charged with securing the United States' borders: the U.S. Customs and Border Protection (CBP), which patrols the border and conducts immigrations, customs, and agricultural inspections at ports of entry; the U.S. Immigrations and Customs Enforcement (ICE), which investigates immigrations and customs violations in the interior of the country; the United States Coast Guard, which provides maritime and port security; and the Transportation Security Administration (TSA), which is responsible for securing the nation's land, rail, and air transportation networks. This report is meant to serve as a primer on the key federal agencies charged with border security; as such it will briefly describe each agency's role in securing our nation's borders. This report will be updated as needed.

The Individuals with Disabilities Education Act (IDEA) is a grants and civil rights statute which provides federal funding to the states to help provide education for children with disabilities. If a state receives funds under IDEA, it must make available a free, appropriate public education (FAPE) for all children with disabilities in the state. Another key requirement of IDEA is "child find" which requires that all children with disabilities be located, identified, and evaluated. Education for children with disabilities in private schools is included in IDEA, but the requirements of the statute for children in private schools are not always the same as the requirements for children with disabilities in public schools. For example, there are specific requirements delineated regarding private schools. Issues concerning what services are required for children with disabilities placed in private schools, and who is to pay for these services, have been a continuing source of controversy under IDEA. Under the law prior to the enactment of P.L. 105-17 in 1997, states were required to set forth policies and procedures to ensure that provision was made for the participation of children with disabilities who are enrolled in private schools by their parents consistent with the number and location of these children. These requirements were further detailed in regulations which required that local education agencies (LEAs) provide private school students an opportunity for equitable participation in program benefits and that these benefits had to be "comparable in quality, scope, and opportunity for participation to the program benefits" provided to students in the public schools. The vagueness of the statute and the "equitable participation" standard led to differences among the states and localities and to differences among the courts. Prior to P.L. 105-17 , the courts of appeals that had considered these issues had sharply divergent views. Some courts gave local authorities broad discretion to decide whether to provide services for children with disabilities in private schools, which generally resulted in fewer services to such children, while others attempted to equalize the costs for public and private school children. The Supreme Court had granted certiorari in several of these cases, but when Congress rewrote the law in 1997, the Court vacated and remanded these cases. The IDEA Amendments of 1997 rejected the "equitable participation" standard and provided that to the extent consistent with the number and location of children with disabilities in the state who were enrolled in private schools by their parents, provision was made for the participation of these children in programs assisted by Part B by providing them with special education and related services. The amounts expended for these services by an LEA were to be equal to a proportionate amount of federal funds made available to the local educational agency under Part B of IDEA. These services could be provided to children with disabilities on the premises of private schools, including parochial, elementary, and secondary schools. There was also a requirement that the statutory provisions relating to "child find," identifying children with disabilities, are applicable to children enrolled in private schools, including parochial schools. Much of the 1997 language regarding private schools was kept in the 2004 reauthorization, but changes to these provisions were made, and these are discussed in more detail in the subsequent discussion of current law. Generally, the Senate report observed that "the intent of these changes is to clarify the responsibilities of LEAs to ensure that services to these children are provided in a fair and equitable manner." In addition, the Senate report stated that "many of the changes reflect current policy enumerated either in existing IDEA regulations or the No Child Left Behind Act." The House report noted that "the bill makes a number of changes to clarify the responsibilities of local educational agencies to children with disabilities who are placed by their parents in private schools. The Committee feels that these are important changes that will resolve a number of issues that have been the subject of an increasing amount of contention in the last few years." Under current law, there are several ways a child with a disability may be placed in a private school, and the LEA's responsibilities under IDEA vary depending on the type of placement. A child with a disability may be placed in a private school by the LEA or state educational agency (SEA) as a means of fulfilling the FAPE requirement for the child. In this situation, the full cost is paid for by the LEA or the SEA. A child with a disability may also be unilaterally placed in a private school by his or her parents. In this situation, the cost of the private school placement is not paid by the LEA unless a hearing officer or a court makes certain findings. IDEA states in part, (ii) REIMBURSEMENT FOR PRIVATE SCHOOL PLACEMENT.—If the parents of a child with a disability, who previously received special education and related services under the authority of a public agency, enroll the child in a private elementary school or secondary school without the consent of or referral by the public agency, a court or a hearing officer may require the agency to reimburse the parents for the cost of the enrollment if the court or hearing officer finds that the agency had not made a free appropriate public education available to the child in a timely manner prior to that enrollment. However, IDEA does require some services for children in private schools, even if they are unilaterally placed there by their parents, and there is no finding that FAPE was not made available to the child. In this situation, IDEA requires that a proportionate amount of the federal funds shall be made available. As noted previously, sometimes parents place their child in a private school when they disagree with the LEA concerning whether the LEA can provide FAPE. In School Committee of the Town of Burlington v. Department of Education of Massachusetts , the Supreme Court held that the statutory provision granting courts the right to grant such relief as the court deems appropriate includes the power to order school authorities to reimburse parents for private school expenditures. However, this reimbursement is permitted only if a court ultimately determines that the private school placement, rather than a proposed individualized education program (IEP), is proper under the act. The reimbursement may be reduced or denied if the child's parents did not give certain notice, if the parents did not make the child available for an evaluation by the LEA, or if a court finds the parents' actions unreasonable. The cost of reimbursement is not to be reduced or denied for the failure to provide notice if the school prevented the parent from providing such notice, the parents had not received notice of the notice requirement, or compliance would likely result in physical harm to the child. In addition, at the discretion of a court or hearing officer , the reimbursement may not be reduced or denied if the parent is illiterate or cannot write in English or compliance with the notice requirement would likely result in serious emotional harm to the child (§612(a)(10)(C)(iv)). The issue of whether FAPE has been or will be provided is a complex one that has been at the crux of many judicial decisions, including those concerning reimbursement for parental private school placement. The first IDEA case to reach the Supreme Court, Board of Education of the Hendrick Hudson Central School District v. Rowley, remains a seminal decision on the requirements of FAPE. The Court held in Rowley that the requirement of FAPE is met when a child is provided with personalized instruction with sufficient support services to benefit educationally from that instruction. This instruction must be provided at public expense, meet the state's educational standards. approximate the grade levels used in the state's regular education, and comport with the child's IEP. Rowley's application to particular fact patterns remains a much-litigated issue. The Supreme Court has also addressed the issue of whether parents can receive reimbursement from an LEA for unilaterally placing their child in a private school even if the child has never received IDEA services. In the Supreme Court's most recent IDEA decision, Forest Grove School District v. T.A., the Court held that IDEA authorized reimbursement for private special education services when a public school fails to provide FAPE and the private school placement is appropriate, regardless of whether the child previously received special education services through the public school. The Court emphasized that "[i]t would be particularly strange for the Act to provide a remedy ... when a school district offers a child inadequate ... [special education] services but to leave parents without relief in the more egregious situation in which the school district unreasonably denies a child access to such services altogether." Recent lower court decisions have held that if the child is making some educational progress and the public school has provided an IEP calculated to provide for continued progress, the requirements of FAPE are met and the child is not entitled to a private school placement. For example, in M.H. and J.H. v. Monroe-Woodbury Central School District , the court found that the child's IEP was adequate and, therefore, the parents were not entitled to tuition reimbursement for a private school placement. These same standards have been applied when parents seek to place their child in a private school different from the private school where the school district has placed the child. In addition, if a private school does not adequately address the child's educational needs, the court may not require private school tuition reimbursement. Courts have held that reimbursement for private school tuition is barred if parents arrange for private school educational services without notifying the LEA of their problems with their child's IDEA services. Reimbursement is also barred if the parents act unreasonably in their relations with the school or if the allegation concerns procedural violations that do not rise to a level of substantive harm. Children with disabilities may be unilaterally placed in a private school by their parents in situations where the parents do not argue for tuition reimbursement. Generally, children with disabilities enrolled by their parents in private schools are to be provided special education and related services to the extent consistent with the number and location of such children in the school district served by a LEA pursuant to several requirements. This general provision was changed in 2004 from previous law by the addition of the requirement that the children be located in the school district served by the LEA. In other words, the LEA responsible for implementing IDEA is the LEA in the area where the private school is located. The Senate report described this change as protecting "LEAs from having to work with private schools located in multiple jurisdictions when students attend private schools across district lines." Although the intent was to protect LEAs from working with private schools in multiple jurisdictions, this provision has generated considerable controversy. A detailed discussion of this issue is beyond the scope of this report; however, several of the issues raised include the disproportional effect on LEAs with large concentrations of private schools, the lack of change in the funding formula to reflect the change, and potential conflicts with state laws. In addition to the general LEA responsibility discussed above, there are also five specific requirements regarding parentally placed children: Funds expended by the LEA, including direct services to parentally placed private school children, shall be equal to a proportionate amount of federal funds made available under part B of IDEA. The LEA, after timely and meaningful consultation with representatives of private schools, shall conduct a thorough and complete child find process to determine the number of children with disabilities who are parentally placed in private schools. Services may be provided to children on the premises of private, including religious, schools, to the extent consistent with law. State and local funds may supplement, but not supplant, the proportionate amount of federal funds required to be expended. Each LEA must maintain records and provide to the SEA the number of children evaluated, the number of children determined to have disabilities, and the number of children served under the private school provisions. However, although IDEA does require services to parentally placed children, it should be emphasized that no parentally placed child has an individual right to receive the services that child would receive if enrolled in the public school. IDEA contains requirements concerning LEA consultation with private school officials and representatives of the parents of parentally placed private school children with disabilities. This consultation is to include the child find process and how parentally placed private school children with disabilities can participate equitably; the determination of the proportionate amount of federal funds available to serve parentally placed private school children with disabilities, including how that amount was calculated; the consultation process among the LEA, private school officials, and representatives of parents of parentally placed private school children with disabilities, including how the process will operate; how, where, and by whom special education and related services will be provided for parentally placed private school children with disabilities, including a discussion of the types of services (including direct services and alternate service delivery mechanisms), how the services will be apportioned if there are insufficient funds to serve all children, and how and when these decisions will be made; and how the LEA shall provide a written explanation to private school officials of the reasons why the LEA chose not to provide services if the LEA and private school officials disagree. A written affirmation of the consultation signed by the representatives of the participating private schools is required by the law. If the private school representatives do not sign within a reasonable period of time, the LEA shall forward the documentation to the SEA. A private school official has the right to submit a complaint to the SEA alleging that the LEA did not engage in meaningful and timely consultation or did not give due consideration to the views of the private school official. If a private school official submits a complaint, he or she must provide the basis of the noncompliance to the SEA, and the LEA must forward the appropriate documentation. If the private school official is dissatisfied with the SEA's determination, he or she may submit a complaint to the Secretary of Education, and the SEA shall forward the appropriate documentation to the Secretary. The general IDEA due process procedures are not applicable for children parentally placed in private schools where FAPE is not an issue except where the complaint concerns child find.

The Individuals with Disabilities Education Act (IDEA) is a grants and civil rights statute which provides federal funding to the states to help provide education for children with disabilities. If a state receives funds under IDEA, it must make available a free, appropriate public education (FAPE) for all children with disabilities in the state. Education for children with disabilities in private schools is included in IDEA, but the requirements of the statute for children in private schools are not always the same as the requirements for children with disabilities in public schools. Under current law, there are several ways a child with a disability may be placed in a private school, and the LEA's responsibilities under IDEA vary depending on the type of placement. A child with a disability may be placed in a private school by the local education agency (LEA) or state educational agency (SEA) as a means of fulfilling the FAPE requirement for the child. In this situation, the full cost is paid for by the LEA or the SEA. A child with a disability may also be unilaterally placed in a private school by his or her parents. In this situation, the cost of the private school placement is not paid by the LEA unless a hearing officer or a court makes certain findings. However, IDEA does require some services for children in private schools, even if they are unilaterally placed there by their parents, and there is no finding that FAPE was not made available to the child. In this situation, IDEA requires that a proportionate amount of the federal funds shall be made available.

Since becoming independent in 1991, Armenia has made unsteady progress toward democratization, according to many international observers. These observers—including international organizations such as the Council of Europe (COE), the Organization for Security and Cooperation in Europe (OSCE), and the European Union (EU), and some governments including the United States—had viewed Armenia's previous legislative and presidential elections in 2003 as not free and fair. These observers cautioned the Armenian government that the conduct of the May 2007 legislative election would be taken into account in future relations. Significant events in the run-up to the May 2007 legislative race included constitutional amendments approved in November 2005 which strengthened the role of the legislature, including giving it responsibility for appointing some judicial and media regulatory personnel and a voice in appointing a prime minister. Amendments to the election law increased the legislative term from four to five years and restricted voting by citizens who were outside the country at the time of elections. In May 2006, the Rule of Law Party left the ruling government coalition and joined the opposition, leaving the remaining coalition members—the Republican Party of Armenia and the Armenian Revolutionary Federation—in a strengthened position. A new party formed in 2004, the Prosperous Armenia Party, led by businessman Gagik Tsarukyan, seemed to gain substantial popularity. In March 2007, Prime Minister Margoyan died, and President Kocharyan appointed then-Defense Minister Serzh Sargisyan as the new prime minister. Sargisyan's leadership of the Republican Party of Armenia placed him at the forefront of the party's campaign for seats. The Central Electoral Commission (CEC) of Armenia followed an inclusive policy and registered 23 parties and one electoral bloc (Impeachment) on April 4 for the proportional part of the legislative election. In the constituency races, the CEC registered 119 candidates. In seven constituencies, candidates ran unopposed. Campaigning began on April 8 and ended on May 10. The Pan-Armenian National Movement (the party of former president Levon Ter-Petrossyan) dropped out in late April and called for other opposition parties to follow suit to reduce the number of such parties competing for votes. Another formerly prominent party, the National Democratic Union headed by Vazgen Manukyan, refused to take part in what it claimed would be a fraudulent election. The political campaign was mostly calm. Exceptions included explosions at offices of the Prosperous Armenia Party on April 11, the arrest of two members of the opposition Civic Disobedience Movement on money laundering charges on May 7, and the use of police force against marchers from the Impeachment bloc on May 9, which resulted in some injuries. Armenian media reported that Kocharyan accused Artur Baghdasaryan, the head of the Rule of Law Party, of "betrayal" for allegedly discussing with a British diplomat how the West might critique the election. Under the electoral law, the parties and candidates received free air time for campaign messages. Except for these opportunities, the main public and private television channels mostly covered pro-government party campaigning, and private billboard companies mostly sold space to these parties. The public radio station appeared editorially balanced. Positive or neutral reports dominated in the media, according to OSCE/COE/EU election observers. Most campaigning appeared to stress personalities rather than programs, according to many observers. To the extent issues were discussed, the focus was largely on domestic concerns such as rural development, pensions, education, jobs, and healthcare. The CEC reported that almost 1.4 million of 2.3 million eligible voters turned out (about 60%). The Republican Party of Armenia gained more seats than it won in the last legislative election. The Prosperous Armenia Party failed to get as many votes as expected. It also was surprising that the United Labor Party failed to gain seats. The opposition parties (Rule of Law and Heritage) won 16 seats, fewer than the opposition held in the previous legislature, although parties considered oppositionist received about one-fourth of the total popular vote. While hailing the election as "free, fair, and transparent," Kocharyan on May 14 reportedly pledged that "shortcomings and violations, which took place during the elections, will be thoroughly studied in order to take necessary measures and re-establish legality," a pledge reiterated to the OSCE by Sarkisyan on May 22. According to the preliminary conclusions made by observers from the OSCE, COE, and the EU, the legislative elections "demonstrated improvement and were conducted largely in accordance with ... international standards for democratic elections." They praised an inclusive candidate registration process, dynamic campaigning in a permissive environment, extensive media coverage, and a calm atmosphere in polling places. However, they raised some concerns over pro-government party domination of electoral commissions, the low number of candidates in constituency races, and inaccurate campaign finance disclosures. Observers also reported a few instances of voters apparently using fraudulent passports for identification, of vote-buying, and of individuals voting more than once. In a follow-on assessment, the OSCE/COE/EU observers raised more concerns that vote-counting problems could harm public confidence in the results. The inability of opposition parties to form a coalition like the former Justice Bloc in 2003 harmed their chances by splitting the vote. The failure of some formerly prominent opposition parties to win seats raises questions of their future viability. These include the People's Party of Armenia (led by Demirchyan, the runner-up in the 2003 presidential election), the National Unity Party (led by Artashes Geghamyan), and the Republic Party (led by Aram Sargisyan). While the pro-government Republican Party of Armenia and Prosperous Armenia Party argued that the losing parties sealed their own marginalization because they were not attractive to the electorate, the losing parties responded that they were outspent and hurt by voter apathy and electoral fraud. At a rally on May 18, the two opposition parties that won seats in the legislature (Rule of Law and Heritage) joined the Impeachment bloc and other opposition parties to call on the Constitutional Court to void the election. The Pan-Armenian National Movement, which had dropped out the race, issued a statement alleging that sophisticated methods had been used to rig the vote. Addressing such accusations, CEC spokesperson Tsovinar Khachatrian reportedly gave assurances that the vote count and results were "normal." She stated that the CEC had received only seven complaints, and that recounts had resulted in "no essential changes in the results." Armenian media reported on May 21 that four cases had resulted in criminal charges, but only one involved the falsification of the election results by polling place workers. The Impeachment bloc and other opposition parties held more rallies on May 25 and June 1 to demand a new election. Since President Kocharyan is constitutionally limited to two terms, the parties showing well in the legislative election are expected to be best poised to put forth their candidates for a presidential election in 2008. The Republican Party of Armenia's strong showing places Prime Minister Sargisyan as the front runner for president if he chooses to run. According to analyst Emil Danielyan, opposition parties may counter by appealing to the cynicism of many Armenians about the electoral results and by urging them to support alternative presidential candidates. Some observers suggest that the opposition parties may again fail to cooperate and instead put forward multiple presidential candidates, fracturing the opposition vote. The election also may be more significant than previous ones because the legislature has been given enhanced constitutional powers, according to some observers. In calling for the election of pro-government legislators, Kocharyan warned on May 10 that "it is important that the new parliament and the president cooperate and that these two state institutions do not confront each other," or otherwise the country's citizens will suffer. Since the Republican Party of Armenia increased its number of seats to a near-majority in the legislature and the opposition parties lost seats, it is unlikely that the domestic and foreign policies of the government will change greatly, according to many observers. There conceivably could be some changes in some policies, however, as the Republican Party of Armenia seeks to form a coalition government. Reasons for the Republican Party of Armenia to seek a coalition rather than form a one-party government include increasing its legislative support and influence in the run-up to the presidential race. Other spurs to forming such a coalition may include the plans by the Rule of Law and Heritage parties to use their presence in the legislature to challenge government policies, rather than to repeat the failed past opposition strategy of boycotting the legislature. Such plans may reinforce Kocharyan's reported view that these parties are not "constructive" opposition parties and that they need to be countered by a legislative coalition. Some observers warn that Kocharyan, as a lame-duck president, may become less influential in Armenian politics and that he and Sargisyan could come to clash on personnel and policy issues in coming months. Other observers suggest that both leaders—who are comrades-in-arms of the conflict over Azerbaijan's breakaway region of Nagorno Karabakh—will cooperate to achieve their future political goals, which conceivably might include a position for Kocharyan in a political party or a potential Sargisyan administration. Kocharyan and Sargisyan may cooperate in negotiations with Azerbaijan to settle the Nagorno Karabakh conflict, possibly because a Sargisyan administration might have responsibility for implementing a potential settlement. Another possible clash between Sargisyan and Tsarukyan may be mitigated to some degree through power-sharing negotiations on forming a coalition government. Russia appeared interested in the outcome of the election by stressing its good relations with the existing Armenian government. During the height of campaigning in April, the Russian Minister of Foreign Affairs, the First Deputy Prime Minister, and other high-level officials visited Armenia. A group of election observers from the Commonwealth of Independent States judged the election as "free and fair." European institutions such as the OSCE, COE and the EU appeared poised to accept the electoral outcome as being sufficiently progressive to bolster their assistance and other ties to Armenia, according to some initial statements. The EU Council President, German Chancellor Anela Merkel, seemed to typify this stance when she stated that the elections were "on the whole, conducted fairly, freely and largely in accordance with the international commitments which Armenia had entered into," and that she was "very much in favor of intensifying cooperation with Armenia. This would breathe new life into the European Neighborhood Policy and the Action Plan agreed under it." The Bush Administration generally viewed the Armenian legislative election as marking progress in democratization. The U.S. State Department reported on May 14 that "all and all, [the Armenian election was] an improvement over past elections; though certainly if you look at what the observers said, it did not fully meet international standards." While praising the electoral progress, the State Department also urged the Armenian government to "aggressively investigate allegations that are there of electoral wrongdoing and prosecute people in accordance with Armenian law." Armenia's election may rank it with Georgia as making progress in democratization in the South Caucasus region, according to some observers. Under this view, democratization facilitates cooperation, so a more democratic Armenia might be able to deepen ties with nearby NATO members in the wider Black Sea region. In the Caspian Sea region, it might serve as an exemplar to local democracy advocates. Progress in elections is one condition for continued Millennium Challenge Account assistance (MCA; set up in 2004 to support countries that are dedicated to democratization and the creation of market economies). When Armenia and the United States concluded a "compact" for $235.65 million in MCA assistance in March 2006, Armenia's low standing on "political rights" as scored by the MCA was raised as a problem that needed to be addressed. Following the latest election, Armenia's previous "failing" score on political rights may be higher (if initial election assessments do not fundamentally change), bolstering its qualifications as an MCA "co-partner in development," according to some observers. Many in Congress have supported democratization efforts in Armenia as indicated by hearings and legislation, including by backing $225 million in cumulative budgeted foreign assistance for democratization (about 13 percent of all aid to Armenia) from FY1992 through FY2006. After the most recent election, Representatives Frank Pallone and Joe Knollenberg—co-chairs of the Congressional Armenia Caucus—sent a letter on May 18, 2007, to President Kocharyan and Prime Minister Sargisyan congratulating Armenia on its "free and fair election cycle." On the House floor, Representative Pallone hailed the "first positive assessment of an election" in Armenia since its independence and stated that it would enhance U.S.-Armenia ties and Armenia's international reputation. He also stated that the election demonstrated the effectiveness of U.S. democratization aid and called on Millennium Challenge to "fully fund its compact with Armenia in an expeditious manner."

This report discusses the campaign and results of Armenia's May 12, 2007, legislative election and examines implications for Armenian and U.S. interests. Many observers viewed the election as marking some democratization progress. The Republican Party of Armenia increased its number of seats to a near-majority and termed the results as a mandate on its policies. The party leader, Prime Minister Serzh Sargisyan, was widely seen as gaining stature as a possible candidate in the upcoming 2008 presidential election. This report may be updated. Related reports include CRS Report RL33453, Armenia, Azerbaijan, and Georgia: Political Developments and Implications for U.S. Interests , by [author name scrubbed].

Morning hour debates have been a part of House floor procedure only since the 103 rd Congress. They began on February 23, 1994, for a 90-day trial period under procedures outlined in a joint leadership unanimous consent agreement (formally, "a standing order of the House"). Morning hour debates were created, in part, to offset the new restrictions on special order speeches that took effect the same day. These restrictions, such as a ban on special orders after midnight and a four-hour limitation on longer special orders, scaled back opportunities for non-legislative debate available through special orders. The 1994 agreement establishing morning hour debates for a 90-day trial period was later extended to cover the remainder of the 103 rd Congress. Morning hour debates continued in the 104 th Congress under a slightly modified unanimous consent agreement. The modification concerned the length and starting time of morning hour debates on Tuesdays "after the first Tuesday in May" (see the " Days and Meeting Times " section for more information). An identical unanimous consent agreement (agreed to on January 6, 2009) governs morning hour speeches in the 111 th Congress. Morning hour debates are not provided for in the rules of the House. Instead, they are a unanimous consent practice of the chamber. The House gives unanimous consent to holding morning hour debates when it agrees to the joint leadership unanimous consent agreement governing these debates. In the 111 th Congress, the chair refers to this agreement at the start of the morning hour debate period when he announces, "[p]ursuant to the order of the House of January 6, 2009, the Chair will now recognize ..." The unanimous consent agreement governs recognition for morning hour debates and establishes the days and meeting times for these debates (for more information, see later sections of this report). During morning hour debates, Members must abide not only by the unanimous consent agreement but also by the rules of the House, the chamber's precedents, and the Speaker's announced policies. Relevant House rules include those governing debate, decorum, and the Speaker's power of recognition. House precedents discuss how the chamber has interpreted and applied its rules. There is not an established body of precedents for morning hour debates because these debates are a relatively new feature of House floor procedure. The term "Speaker's announced policies" refers to the Speaker's policies on certain aspects of House procedure such as decorum in debate, the conduct of electronic votes, and recognition for one-minute and special order speeches. While the Speaker's announced policies do not govern recognition for morning hour debates (the unanimous consent agreement governs recognition), they do regulate television coverage of morning hour debates. The Speaker's policies prohibit House-controlled television cameras from panning the chamber during the morning hour debate period. Instead, a caption (also called a "crawl") appears at the bottom of the television screen indicating that the House is conducting morning hour debates. Morning hour debates are in order only on Mondays and Tuesdays. They take place infrequently on Mondays because the House is not always in session that day. The starting time and length of morning hour debates are established by the joint leadership unanimous consent agreement. The House convenes for Monday morning hour debates 90 minutes earlier than the time established for that day's session. For example, if the House is scheduled to meet at noon, the morning hour debate period begins at 10:30 a.m. The Monday morning hour debate period can last up to one hour, with a maximum of 30 minutes of debate on each side. The full hour is rarely used. Tuesday morning hour speeches on or before May 18, 2009, take place in the same manner as Monday morning hour debates. The agreement provides, however, that Tuesday morning hour debates after May 18, 2009, begin 60 minutes before the chamber's meeting hour for a maximum duration of 50 minutes, with 25 minutes allocated to each side. The different procedures for Tuesday morning debates after early May were first established in the joint leadership unanimous consent agreement of May 12, 1995. These procedures, which are included in the agreement for the 111 th Congress, are designed to accommodate the chamber's practice of convening earlier for legislative business after early May. In the 105 th Congress, the procedures were only on those Tuesdays after early May when the House was scheduled to meet at 10:00 a.m. On Tuesdays after early May when the chamber's appointed meeting hour was a later time (e.g., 12:00 noon), the Tuesday morning debates took place in the same manner as Monday morning hour debates. When Monday and Tuesday morning hour debates are completed, the House recesses until the meeting hour established for that day's session. The daily prayer, the pledge of allegiance, and approval of the previous day's Journal take place when the House meets after this recess. The joint leadership unanimous consent agreement requires that the majority and minority leaders give the Speaker a list showing how each party's time for morning hour debates will be allocated among its Members. The chair follows this list in recognizing Members for morning hour debates. A majority party Representative appointed as "Speaker pro tempore " often presides in the chair during morning hour debates. During each morning hour debate period, he alternates recognition between the majority and minority for both the initial morning hour speech (i.e., if a majority Member is recognized for the first speech on Monday, a minority Member is recognized for first speech on Tuesday) and subsequent ones. Individual Members must limit their morning hour debate speech to five minutes or less. Only the majority leader, minority leader, or the minority whip may deliver a morning hour debate speech longer than five minutes. Members reserve time for morning hour debates through their party leadership: Democratic Representatives reserve time through the Office of the Minority Leader, and Republican Members do so through the Republican cloakroom or the party leadership desk on the House floor. Reservations can be made no earlier than one week before the speech date. While most Members reserve five minutes for their morning hour speech, some Representatives reserve as little as one minute. Individual Members often use the morning hour debate period to deliver speeches on subjects unrelated to legislation before the House. They deliver eulogies and tributes to individuals and organizations from their congressional district. They also use the period to deliver speeches on broad policy issues and to present their views on local, national, and international events. Because morning hour debates take place early in the day, they are sometimes used by individual Members and the party leadership to share information relevant to that day's session. For example, Members deliver morning hour speeches to explain a bill they are introducing that day and to invite cosponsors. The chairman of the Rules Committee has spoken during morning hour debates to announce an emergency meeting of the committee. This use of morning hour debates to disseminate information among colleagues parallels how Members often employ one-minute speeches as a visual form of the "Dear Colleague" letter. On occasion, Members of the same party use the morning hour debate period to deliver a series of speeches about the party's views on a particular bill or policy issue. For example, on February 11, 1997, four minority party Members delivered morning hour debate speeches on campaign finance reform. This coordinated use of morning hour debates by party Members is similar to how the parties sometimes use "leadership special orders" (i.e., the first hour of longer special orders that is usually reserved for the party's leadership or a designee) to focus on a specific theme with participation from other party Members.

On Mondays and Tuesdays, the House of Representatives meets earlier than the hour established for that day's session for a period called "morning hour debates" (also known as "morning hour speeches"). This period provides a rare opportunity for non-legislative debate in the House; remarks in the House are usually limited to pending legislative business. During morning hour debates, individual Members deliver speeches on topics of their choice for up to five minutes. The majority and minority leaders give the Speaker a list showing how each party's time for morning hour debates will be allocated among its Members. The chair follows this list in recognizing Members for morning hour debates. At the conclusion of morning hour debates, the House recesses until the starting time for that day's session. This report examines current House practices for morning hour debates and how these debates are used. It will be updated if rules and procedures change.

Over the past several decades, U.S. household indebtedness has generally risen regardless of macroeconomic or financial conditions. In light of the 2007-2009 recession, however, households are reducing their debt burdens. Household debt balances fell in the third quarter of 2008 and continued to do so until the second quarter of 2011 when they rose by 0.55% before resuming their downward trend. Simultaneous declines in household income and net worth made it difficult for some households to support previous debt levels, thus encouraging them to reduce debt service obligations and work toward restoring the health of their balance sheets. Household debt reduction (or deleveraging) may have important implications for job creation and economic recovery. Deleveraging may translate into a reduction in near-term consumption, which typically accounts for approximately 70% of gross domestic product and likely an important source of economic recovery. Deleveraging may also manifest itself in the form of above normal loan defaults that weaken the banking system and discourage new lending, which can be the source of job creation. Moreover, when consumer spending and bank lending are curtailed, fiscal policy initiatives (e.g., tax cuts or spending increases) become less effective at stimulating the economy. For example, academic experts have proposed large-scale mortgage refinancing efforts to propel economic stimulus. In light of these recommendations, the purpose of policy initiatives (e.g., the Home Affordable Refinance Program [HARP], H.R. 363 and its companion S. 170 , the Housing Opportunity and Mortgage Equity Act of 2011) is to facilitate the refinancing of mortgages. In addition, the Obama Administration announced an initiative to assist qualified homeowners, whose mortgages are not owned or guaranteed by any institution affiliated with the federal government, in lowering their mortgage rates. If refinancing activity results in lower mortgage payments, then households may have more discretionary income to spend and, therefore, spur economic stimulus. Some households, however, are choosing to pay down current debt obligations, which means any additional income that would have gone toward mortgage interest still may not be applied to new spending. Hence, policies aimed at stimulating near-term consumption may instead enhance future borrowing capacity and longer-term consumption if households continue to strengthen their balance sheets via near-term deleveraging. This report presents data illustrating household deleveraging since 2008 in comparison to previous trends in household credit use. It also presents various explanations for deleveraging—in particular, changes in both consumer demand and lending supply. On the demand side, job losses and declining wealth particularly associated with declining real estate values are factors that made it difficult for households to repay old loans or secure new ones. On the supply side, rising loan losses caused lenders to write off more obligations, which put a strain on lenders' (regulatory) capital reserves. Consequently, lending standards are higher and likely to remain until lenders feel more confident that borrowers have the ability to repay. Figure 1 illustrates the Federal Reserve's aggregate household debt service burden ratio (DSR). The DSR is the percentage of disposable personal income required to make minimum repayments on outstanding mortgage and consumer debt. Beginning in the mid-1990s, the DSR rose but then declined after 2008. The DSR movements are affected by changes in the amount of household debt, changes in household income, and changes in interest rates (debt costs). Rising incomes and falling interest rates would cause the DSR to fall over time. Given the rise in real disposable income prior to the financial crisis coupled with falling interest rates, the rise in the DSR reflects household debt usage rising at a faster pace than household income growth. Conversely, the DSR might be expected to rise during recessions when incomes tend to fall. During the 2007-2009 recession, however, the DSR began to decline in 2008, which reflects a shift toward deleveraging by households as well as the refinancing of some debt at lower interest rates. Figure 2 illustrates the quarterly percentage change in total household debt balances since 1968, and the shaded areas indicate U.S. recessions. Household debt balances consist of home mortgages, revolving or credit card debt, and nonrevolving credit, which consists primarily of automobile and student loans. Note that the growth rate of household debt declined during the 1981-1982, 1990-1991, and 2001 recessions but still remained positive. Beginning in the second quarter of 2008 through the first quarter of 2011, however, the rate of change in debt usage became negative and was sustained. Post-2008 household deleveraging, therefore, appears to be atypical compared with previous economic contractions occurring over the past few decades. Table 1 illustrates the percentage changes in household debt usage from the second quarter of 2008 through the third quarter of 2011 by loan type. Mortgage debt represents the largest share of all household debt. A significant share of the decline in mortgage debt outstanding can be attributed to declining home equity loan balances, which can be used as a substitute for other types of consumer credit. Revolving or credit card debt use also declined, but growth in nonrevolving credit remained positive over this period. Household deleveraging may be explained by factors influencing both the demand for and supply of credit. Beginning with demand-side explanations, the spike in unemployment and a decline in household net worth, which occurred during the recession of 2007-2009 and has continued along with declining home values, can lead to debt reduction either by inducing households to curtail credit use (and pay down existing debt) or in the form of defaults. On the supply side, lenders experiencing large volumes of loan losses may have also grown more reluctant to make loans. This section explains these factors in more detail. "Trigger events" are defined as sudden changes in circumstances that can lead to greater loan defaults. A steep rise in unemployment is an example of a trigger event. During the 2007-2009 recession, the unemployment rate soared to 10.0%, which was the highest it has climbed since 1982. Job losses can translate into income disruptions that make it difficult to repay existing credit obligations or seek new loans. A sharp, unanticipated decline in household net worth is another example of a trigger event. During the 2007-2009 recession, households saw a decline in household net worth that had not occurred in previous recessions over the past three decades ( Figure 3 ). Net worth (i.e., the difference between the value of assets and liabilities) fell for seven consecutive quarters beginning in the third quarter of 2007. The most recent decline in net worth was larger and persisted for more successive quarters than did the steep decline in the stock market of the late 1990s, which lasted until approximately 2002. Much of the decline in net worth is attributable to real estate assets that many households financed through borrowing. The Federal Housing Finance Agency and Case-Shiller house price indices show that U.S. house prices began declining in 2007, and homeowners were increasingly likely to find themselves "underwater" or "upside-down" as the amount of their outstanding mortgage balances exceeded current home values. Academic research suggests that changes in real estate values generate a greater response in consumer spending and borrowing decisions than do changes to stock values. For one reason, most households purchase stocks with cash, which means there are no debt obligations to repay based upon the original purchase prices should their stock assets fall in value. Second, stock market declines are often short-lived in comparison to declines in real estate values, which means volatile short-term fluctuations are less likely to prompt investors to reassess longer term financial decisions. Housing assets are also typically a much larger component of household balance sheets. Hence, stock market declines tend to have a smaller impact on household consumption and borrowing decisions relative to declines in real estate prices. Given that declining real estate asset values may lead to permanent wealth reductions that would prevent existing (mortgage) debt obligations from being repaid, two possible reasons for household deleveraging are worth considering. Households may have a precautionary savings motive that influences them to reduce borrowing when household wealth drops. If households wish to maintain a certain level of wealth to protect against unexpected economic reversals, their consumption behavior is likely to change if those balances fall below desired thresholds. Households may reduce spending (and borrowing) and increase saving until net wealth has been restored to more desirable levels. For example, Figure 4 shows that "cash-in" mortgage refinancings became more common relative to "cash-out" refinancings by 2008. During the mid-2000s housing boom, many borrowers pulled equity out of their homes to finance expenditures. Freddie Mac refers to this type of transaction as a "cash-out" refinance when the outstanding mortgage balance increases by more than 5%. Conversely, a "cash-in" refinance occurs when borrowers refinance and pay down some mortgage principal, which reduces outstanding balances. The percentage of cash-in mortgage refinances began to exceed cash-out refinances in mid-2010. A corresponding reduction of home equity loan balances can represent an array of borrowing given that this type of mortgage product was used to consolidate existing debt obligations, finance new consumption, and even finance the acquisition of new (real estate) assets. Moreover, the soaring unemployment rate may have influenced many households to reduce debt obligations just in case their continued employment prospects seemed at risk. Hence, such a marked increase in cash-in refinances arguably may reflect an increase in precautionary savings behavior by households in response to an adverse trigger event, which generates greater economic and financial uncertainty. A negative trigger event in the form of job losses (or shifts to part-time status) is likely to disrupt income streams. A severe and persistent disruption, when coupled with circumstances that prevent, for example, the sale of housing assets for amounts necessary to pay off outstanding mortgage balances, may cause households to default on existing loans. Moreover, risky mortgage underwriting practices prior to the 2007-2009 recession made it possible for some borrowers to receive mortgages that could only be repaid assuming continued house price growth rather than income growth. The combination of relaxed underwriting standards, which allowed for rapid debt accumulation, and the unexpected trigger event, which was the large and pronounced downturn in U.S. house prices, resulted in greater household defaults on all types of loans. Figure 5 shows charge-off rates for commercial bank loans in three categories: single-family residential mortgages, credit card debt, and other consumer loans. Charge-offs occur when lenders conclude that a debt will not be repaid and charge it against their loss reserves. During the past few years, all three major categories of household debt experienced rising loss rates. The previous explanations involved factors influencing the demand for credit, but household deleveraging may also be affected by a reduction in credit supply. Rising loan losses may cause lenders to be more skeptical about extending new credit without greater assurances of repayment. Many banks may be unable to make new loans if they are still struggling to rebuild their required loan loss reserves and capital reserves, which have been diminished by loan defaults. The observed household deleveraging, therefore, may reflect both decreasing supply and demand for credit given the extent to which lenders tightened underwriting standards, lowered existing lines of credit, and restricted new lending to stabilize profitability and satisfy regulatory capital requirements. The Federal Reserve's Senior Loan Officer Opinion Survey on Bank Lending Practices, which is conducted quarterly, asks bankers about changes in the standards and terms of bank lending as well as changes in the demand for loans. Figure 6 presents a graphical illustration of the responses collected between 1996 and 2011. The two dotted lines represent the net percentage of loan officers reporting that they expect to tighten standards for credit card and other consumer loans. The greatest tightening of loan standards over the period began in 2007.

Since the third quarter of 2008, U.S. household debt has steadily fallen. Household debt reduction is known as deleveraging, and such substantial and persistent deleveraging (reflected in Federal Reserve data) has been uncommon over the past several decades. Given that much household debt is used to finance consumption, which accounts for about 70% of gross domestic product, continued deleveraging implies slower consumption growth and economic recovery. Beginning in the third quarter of 2007, household net worth (i.e., the difference between the value of assets and liabilities) preceded the fall in household debt. The recent drop in household net worth has also been substantial and persistent relative to previous decades and, therefore, may arguably have precipitated such pronounced household deleveraging. Household deleveraging may dampen the immediate effectiveness of legislative efforts to generate economic stimulus. For example, H.R. 363 and its companion S. 170, the Housing Opportunity and Mortgage Equity Act of 2011, were introduced to facilitate the refinancing of mortgages held by the government-sponsored enterprises. In addition, the Obama Administration announced an initiative to assist qualified homeowners with privately held mortgages refinance into lower rate loans. If refinancing activity results in lower mortgage payments, then households may have more discretionary income to spend and, therefore, spur economic stimulus. Given the trend of household debt reduction, the additional income that would have gone toward paying mortgage interest still may not be applied to new spending. Households may prefer using the additional income to pay down current debt obligations. Hence, such legislative efforts may enhance future borrowing capacity and long-term consumption if households continue to strengthen their balance sheets via deleveraging, but the effect on near-term consumption activity may be modest. This report presents information on recent household debt usage patterns. It also discusses possible reasons for the reduction in household credit use. Consumers have reduced their indebtedness by accelerating repayment of outstanding debts and defaulting on loan obligations. Lenders have also tightened lending standards. Hence, both demand and supply factors can explain the decline in household credit usage.

On May 24, 2010, the Supreme Court issued its decision in Lewis v. City of Chicago , a case involving questions regarding the timeliness of disparate impact discrimination claims filed under Title VII of the Civil Rights Act of 1964, which prohibits employment discrimination on the basis of race, color, national origin, sex, or religion. In Lewis , a group of aspiring black firefighters sued the City of Chicago over its repeated use of an employment test with racially disproportionate results to hire several new groups of firefighters over a six-year period. The city argued that the applicants, who filed their claim almost two years after the employment examination was administered, had exceeded the statutory deadline for filing claims under Title VII, while the applicants claimed that the city committed a fresh act of discrimination each time it relied upon the test to hire a new class of firefighters, thus repeatedly restarting the clock on the filing deadline. In a unanimous decision, the Supreme Court ruled in favor of the applicants for the firefighting positions, holding that such disparate impact claims may be brought each time an employer uses the results of a discriminatory test to hire. In 1995, over 26,000 applicants seeking to join the Chicago Fire Department took an employment examination administered by the city. Based on the scores of the examination, the city established three groups of applicants: those who were "well-qualified," "qualified," or "not qualified." On nine occasions, the city selected new hires from the pool of well-qualified candidates, although on the last occasion the city also hired applicants from the qualified group once it had exhausted the pool of well-qualified candidates. These nine hirings occurred over a six-year period. In 1997, a group of black applicants who scored in the qualified range filed a charge of discrimination with the Equal Employment Opportunity Commission (EEOC) claiming that the city's practice of initially hiring only from the well-qualified group, which was 75.8% white and only 11.5% black, had an unlawful disparate impact on the basis of race. Subsequently, they filed a Title VII suit in federal court, and the district court certified a class of more than 6,000 black applicants who had scored in the qualified range but had not been hired. Although the city stipulated that its classification of applicants as either well-qualified or qualified had had a disparate racial impact, it sought summary judgment on the ground that the applicants had failed to file their EEOC claim within the statutorily mandated deadline. The district court rejected this argument and later ruled in favor of the applicants, ordering the city to hire 132 members of the class and awarding back pay to the rest. The U.S. Court of Appeals for the Seventh Circuit reversed the district court's decision, holding that the applicants had failed to meet the statutory filing deadline because "[t]he hiring only of applicants classified 'well qualified' was the automatic consequence of the test scores rather than the product of a fresh act of discrimination." The Supreme Court granted review in order to determine "whether a plaintiff who does not file a timely charge challenging the adoption of a practice—here, an employer's decision to exclude employment applicants who did not achieve a certain score on an examination—may assert a disparate-impact claim in a timely charge challenging the employer's later application of that practice." Under Title VII, two different types of discrimination are prohibited. The first is disparate treatment, which involves intentional discrimination, such as treating an individual differently because of his or her race. The second type of prohibited discrimination—at issue in Lewis —is disparate impact, which involves a neutral employment practice that is not intended to discriminate but that nonetheless has a disproportionate effect on protected individuals. An employer may defend against a disparate impact claim by showing that the challenged practice is "job related for the position in question and consistent with business necessity," although a plaintiff may still succeed by demonstrating that the employer refused to adopt an available alternative employment practice that has less disparate impact and serves the employer's legitimate needs. Regardless of whether they allege disparate impact or disparate treatment, individuals who want to challenge an employment practice as unlawful are required to file a charge with the EEOC within a specified period—either 180 days or 300 days, depending on the state—"after the alleged unlawful employment practice occurred." The question that arose for the Supreme Court in Lewis was whether the city's subsequent use, rather than its initial adoption, of a discriminatorily tiered hiring system constituted an unlawful employment practice for purposes of starting the clock on the filing deadline. Ultimately, the Court ruled unanimously in favor of the applicants, holding that such disparate impact claims may be brought when a plaintiff challenges an employer's subsequent application of an earlier-adopted discriminatory practice. In its brief opinion, the Court relied on the text of Title VII to determine that the city's refusal to hire those applicants whose scores fell below the well-qualified range constituted an "employment practice," and thus concluded that the applicants could proceed with their suit because they had established a prima facie disparate impact claim by showing, as Title VII requires, that the employer "uses a particular employment practice that causes a disparate impact." In rejecting the city's contention that the only actionable discrimination occurred when it first established cutoff scores for the well-qualified and qualified groups of applicants, the Court distinguished its rulings in several earlier cases, including Ledbetter v. Goodyear Tire & Rubber Co. , a 2007 case in which the Court held that a plaintiff's Title VII claim was untimely, rejecting her argument that each paycheck she received reflected a lower salary due to past discrimination and thus constituted a new violation of the statute. According to the Court, its previous cases "establish only that a Title VII plaintiff must show a 'present violation' within the limitations period." In Ledbetter , which involved a disparate treatment claim and therefore required a showing of discriminatory intent, the plaintiff failed to demonstrate that such intentional discrimination had occurred within the filing period. In a disparate impact case such as Lewis , however, no such showing of discriminatory intent is required, and the Court therefore concluded that the applicants' claim was cognizable. Finally, the Court addressed the practical implications of its decision. According to the city, the Court's decision will cause numerous problems for employers, including new disparate impact lawsuits that challenge employment practices that have been used for years and difficulty defending against such suits after many years have passed. The Court noted, however, that a different reading of the statute would produce equally puzzling results: under the city's interpretation, "if an employer adopts an unlawful practice and no timely charge is brought, it can continue using the practice indefinitely, with impunity, despite ongoing disparate impact." Likewise, litigation could increase if employees who are afraid of missing the filing deadline decide to challenge new employment practices before it is clear whether such practices have a disparate impact. Ultimately, the Court noted that its task is not to address the practical implications of its decision but rather to give effect to the statute. In enacting Title VII, "Congress allowed claims to be brought against an employer who uses a practice that causes disparate impact, whatever the employer's motives and whether or not he has employed the same practice in the past. If the effect was unintended, it is a problem for Congress, not one that the federal courts can fix."

This report discusses Lewis v. City of Chicago, a recent case in which the Supreme Court considered questions regarding the timeliness of disparate impact discrimination claims filed under Title VII of the Civil Rights Act of 1964, which prohibits employment discrimination on the basis of race, color, national origin, sex, or religion. In Lewis, a group of aspiring black firefighters sued the City of Chicago over its repeated use of an employment test with racially disproportionate results to hire several new groups of firefighters over a six-year period. The city argued that the applicants, who filed their claim almost two years after the employment examination was administered, had exceeded the statutory deadline for filing claims under Title VII, while the applicants claimed that the city committed a fresh act of discrimination each time it relied upon the test to hire a new class of firefighters, thus repeatedly restarting the clock on the filing deadline. In a unanimous decision, the Supreme Court ruled in favor of the applicants for the firefighting positions, holding that such disparate impact claims may be brought each time an employer uses the results of a discriminatory test to hire.

Unanimous consent agreements are special orders of the Senate that are agreed to without objection by the chamber's membership. Fundamental to the management of the contemporary Senate, these devices are typically employed to structure floor proceedings and to expedite the chamber's business. Two general types of unanimous consent permeate Senate operations: "simple" and "complex." Both types set aside the rules, precedents, or orders of the Senate via the unanimous concurrence of all Senators. A simple unanimous consent request addresses routine matters, such as dispensing with quorum calls or requesting that certain staff aides have floor privileges. To be sure, there are occasions when a simple unanimous consent request can have policy consequences, such as an objection to setting aside an amendment or dispensing with the reading of an amendment. Simple unanimous consent requests have been used since the First Congress. For example, a Senate rule adopted on April 16, 1789, stated: Every bill shall receive three readings [prior] to its being passed; and the President [of the Senate] shall give notice at each, whether it be first, second, or third; which readings shall be on three different days, unless the Senate unanimously directs otherwise. The focus of this report is on the complex variety: their historical origin, some benchmarks in their evolution, and how they came to be reflected in the Senate's rulebook. Complex agreements establish a tailor-made procedure for virtually anything taken up by the Senate, such as bills, joint resolutions, concurrent resolutions, simple resolutions, amendments, nominations, treaties, or conference reports. As two Senate parliamentarians wrote: There is a fundamental difference between the Senate operating under a unanimous consent agreement and the Senate operating under the Standing Rules. Whereas the Senate Rules permit virtually unlimited debate, and very few restrictions on the right to offer amendments, these agreements usually limit time for debate and the right of Senators to offer amendments. Senators generally accept the debate and amendment restrictions common to most unanimous consent agreements largely for two overlapping reasons: they facilitate the processing of the Senate's workload, and they serve the interests of individual lawmakers. Based on trust, and reached after often protracted negotiations, unanimous consent agreements are the equivalent of "binding contracts" that can only be changed or modified by unanimous consent. It is not clear when the Senate actually began to employ unanimous consent agreements to limit debate or to fix a time for a vote on a measure. Perhaps the first instance occurred in the mid-1840s. On March 24, 1846, Senator William Allen, D-OH, stated that the Senate had been debating a joint resolution concerning the Oregon Territory for more than two months, and it was now time to proceed to a final vote on the matter. Noting that the Senate neither allowed for the previous question (a motion employed in the House to end debate) nor adopted resolutions directing that a vote should occur at a specific time, Senator Allen pointed out that it was the Senate's habit to have "a conversational understanding that an end would be put to a protracted debate at a particular time." A Senate colleague suggested that Allen delay several days before making such a request. Two days later Senator Allen again asked that the Senate informally agree to fix "a definite day on which the vote might be taken." The Senate, he said, should simply refuse to adjourn until there is a final vote. No action occurred on Allen's recommendation. On April 13, 1846, however, a consensus developed among Senators that a final vote on the joint resolution should occur three days later. Finally, after spending around 65 days debating the matter, the Senate on April 16 enacted the joint resolution. Indeed, if this was the first time that the Senate employed something like a unanimous consent agreement to end debate and precipitate a vote on a measure, there is little question that these accords became both more commonly used and more sophisticated in their procedural features. By 1870, noted two scholars, unanimous consent agreements "were being used with some frequency." These early unanimous consent agreements were, "as they are today, time-limitation agreements that provided for the disposal of a measure by a specified time." An April 24, 1879, exchange illustrates the practical use of these accords for limiting debate and setting the time for a vote. The exchange is reminiscent of what occurs in today's Senate. The President pro tempore . The Chair will once more state the proposition and again ask the Senate whether there be any objection to it. The proposition is, that at three o'clock to-morrow, all debate on this bill shall cease, and the Senate shall then proceed to vote upon the pending amendment or amendments that may be offered, and finally on the bill itself without debate. Mr. Conkling . That is right. The President pro tempore . Is there objection to that understanding. The Chair hears none, and it is agreed to. Bill managers apparently took the initiative in propounding unanimous consent agreements. Their increasing use in subsequent decades led one Senator, Roger Mills, D-TX, to complain that the Senate "reaches its vote on all questions like the historic Diet of Poland, by the unanimous agreement of the whole, and not by the act of the majority." Other issues associated with these early accords also sowed confusion among the membership. Many of the complaints stemmed from the fact that the early unanimous consent agreements were often viewed "as an arrangement simply between gentlemen" and could, as a president pro tempore once said, be "violated with impunity by any member of the Senate." To reduce the confusion, the Senate adopted a new rule. The fundamental objective of Rule XII was to clarify several uncertainties associated with these senatorial contracts. In the early 1900s, the Senate took modest steps to reduce some of the confusion associated with unanimous consent agreements, such as requiring these accords to be submitted in writing to the desk, read to the chamber, and "printed on the title page of the daily calendar of business as long as they were operative." More changes were in the offing, however. Two overlapping factors explain why the Senate agreed to a formal rules change to govern these accords. First, there were a couple of ambiguities associated with these accords that continued to arouse contention and confusion. Past precedents simply did not adequately address these recurring problems. Second, a riveting event—a Senator was caught by "surprise" when a unanimous consent agreement was entered into—underscored the need for a formal rule (Rule XII) to clear up issues associated with these "gentlemen's agreements." On the matter of ambiguity, there were two principal issues. First, could these agreements be changed or modified by another unanimous consent agreement? Second, could the presiding officer enforce these accords? Today, both principles are accepted as procedural "givens." Not so several decades ago. For example, on March 3, 1897, Senator George Hoar, R-MA, stated: "I think it is very serious, indeed, under any circumstances, to set the precedent of revoking a unanimous-consent agreement by other unanimous-consent agreements." As another example, one of the Senate's institutional leaders, Henry Cabot Lodge, R-MA., argued: "If it is to be supposed that unanimous-consent agreements are to be modified, we shall soon find it impossible to get a unanimous-consent agreement. I think nothing is more important than the rigidity with which the Senate preserves unanimous-consent agreements." Or as Senator Joseph O'Gorman, D-NY, stated: "Has it not been established by the precedents of this body that a unanimous-consent agreement could not be impaired or modified either by another unanimous-consent agreement or by an order of the Senate?" To be sure, other Senators contended that these compacts could be modified by another unanimous consent agreement. As to the enforcement of these accords, presiding officers took different positions. As one presiding officer observed, "it has been the universal ruling of the Chair that the Chair can not enforce a unanimous-consent agreement, but that it must rest with the honor of Senators themselves." On another occasion, the president of the Senate asked: "[W]hat is the pleasure of the Senate, whether he shall enforce the agreements entered into by unanimous consent or not?" Senator John Sherman, R-OH, replied that the chair should "enforce the agreement with respect to the bill under consideration." The chair then asked, "In similar cases, what is the pleasure of the Senate?" Senator Eugene Hale, R-ME, provided this answer: "We'll cross that bridge when we reach it." Contrarily, "Vice Presidents Charles Fairbanks and James Sherman were not timid about enforcing [unanimous consent agreements] at times." Sundry other issues were also associated with these compacts. For example, Senators argued about whether a motion to recommit a bill violated a unanimous consent agreement to vote on the bill. Some Senators said that if they were not present when a unanimous consent agreement was proposed, colleagues could object for them. In response, Senator Thomas Martin, VA, the ostensible Democratic floor leader, stated: "When unanimous consent is asked, unless objection is made from the floor of the Senate by a Senator who is present, he can not leave his vote here to be recorded against it. The Senate can not do business by proxy that way." Senator Reed Smoot, R-UT, was caught off-guard when a unanimous consent agreement he opposed was agreed to. The issue involved a 1913 bill (S. 4043) to prohibit interstate commerce in intoxicating liquors. A unanimous consent agreement was properly made and announced by the presiding officer. Senator Smoot, who was present in the chamber, had planned to object but was momentarily distracted and failed to lodge a timely dissent. For the next two days the Senate debated the legitimacy of the unanimous consent agreement and whether it could be modified by another unanimous consent agreement. In the end, the presiding officer submitted the question of legitimacy to the Senate, which voted 40 to 17 (with 37 Members not voting) to instruct the chair to resubmit the unanimous consent agreement to the Senate. When this was done, Senator Smoot objected to the accord. Quickly, another unanimous consent agreement on the liquor bill was propounded by Senator Jacob Gallinger, R-NH, and it was accepted by the Senate. In short, uncertainties and controversies influenced the Senate on January 16, 1914, to adopt a formal rule to govern unanimous consent agreements. There was relatively little debate on Rule XII. The major controversy involved whether these compacts could be modified by another unanimous consent agreement. Unsurprisingly, Senator Lodge argued against the new rule on the ground that to permit any subsequent changes to unanimous consent agreements would only lead to delays in expediting the Senate's business. Senator Charles Thomas, D-CO, responded: "It seems to me the most illogical thing in the world to say that the Senate of the United States can unanimously agree to something and by that act deprive itself of the power to agree unanimously to undo it." By a vote of 51 to 8, the Senate adopted Rule XII. Two critical portions of the rule stipulate that (1) unanimous consent agreements are orders of the Senate, which means that the presiding officer is charged with enforcing their terms; and (2) the Senate, by unanimous consent, could change a unanimous consent agreement. As orders of the Senate, unanimous consent agreements are now printed in the Senate Journal . (They are also printed in the Senate's daily Calendar of Business , as noted earlier, and the Congressional Record .) In subsequent decades, the Senate witnessed increasing use of unanimous consent agreements. The contemporary Senate regularly operates via the terms of unanimous consent agreements. They are used on every type of measure or matter that comes before the Senate, and at least since the post-World War II period, all party leaders and floor managers have extensively relied on them to process the chamber's business. During the majority leadership of Senator Lyndon Johnson, D-TX (1955-1960), unanimous consent agreements were often comprehensive in scope (e.g., identifying when a measure is to be taken up, when it is to be voted upon for final passage, and what procedures apply in-between these two stages). Today, in a period of heightened individualism and partisanship, unanimous consent agreements tend to be piecemeal, such as establishing debate limits on a number of discrete amendments without limiting the number of amendments or specifying a time or date for final passage of the legislation. Still, compared with the compacts promulgated during the early 1900s, today's accords are often broader in scope, more complex, and involve more procedural detail. A large body of precedents has even evolved to govern "how [unanimous consent agreements] are to be interpreted and applied in various situations." In short, unanimous consent agreements are essential to the processing of the Senate's workload and protecting the procedural prerogatives of individual senators.

Unanimous consent agreements are fundamental to the operation of the Senate. The institution frequently dispenses with its formal rules and instead follows negotiated agreements submitted on the floor for lawmakers' unanimous approval. Once entered into, unanimous consent agreements can only be changed by unanimous consent. Their objectives are to waive Senate rules and to expedite floor action on measures or matters. Typically, these accords (sometimes called time-limitation agreements) restrict debate and structure chamber consideration of amendments. Given their importance to chamber operations, it is worthwhile to understand the background, or origin, of unanimous consent agreements. The purpose of this report is to examine how and why these informal agreements became special orders of the Senate enforceable by the presiding officer. This report will be updated as circumstances warrant. Further information on unanimous consent agreements can be found in CRS Report 98-225, Unanimous Consent Agreements in the Senate, by [author name scrubbed]; CRS Report RS20594, How Unanimous Consent Agreements Regulate Senate Floor Action, by [author name scrubbed]; and CRS Report 98-310, Senate Unanimous Consent Agreements: Potential Effects on the Amendment Process, by [author name scrubbed].

Senate and House rules place restrictions on the kinds of agreements conferees can propose to their two houses. Implicit in the rules of both chambers is the requirement that conferees resolve the differences committed to them by reaching agreements within what is known as "the scope of the differences" between the House and Senate versions of the bill. The conferees may accept the House position, the Senate position, or a position that is a compromise between them. Any position that is not within this range of options exceeds the scope of the differences between the two houses. It constitutes "matter not committed to them by either House" and makes their conference report subject to a point of order on both the House and Senate floor. In practice, these restrictions are not as stringent as they may seem on their face. The House often waives its rules that restrict the authority of conferees, and the Senate has developed precedents that grant its conferees considerable latitude in reaching agreements with the House, especially when they are in conference with a bill from one house and a single amendment from the other house that proposes to replace the entire text of the bill. Rulings and practices in the Senate have left the chamber with a body of precedents that allow the inclusion of new matter as long as it is reasonably related to the matter sent to conference. Senators can also choose not to raise a scope point of order against a conference report, allowing it to be considered regardless of its content. Paragraph 8 of Senate Rule XLIV places an additional restriction on the content of conference reports. Under the rule, a Senator can raise a point of order against provisions of a conference report if they constitute "new directed spending provisions," which are defined as any item that consists of a specific provision containing a specific level of funding for any specific account, specific program, specific project, or specific activity, when no specific funding was provided for such specific account, specific program, specific project, or specific activity in the measure originally committed to the conferees by either House. It is worth emphasizing that Paragraph 8 of Rule XLIV applies only to the conference report and not to the joint explanatory statement (also known as the statement of managers ) that accompanies it. Joint explanatory statements are signed by the conferees but, like reports of standing committees, are not voted on by the House or the Senate and cannot be changed through any formal amendment process. It is the conference report that contains the formal legislative language that will become law if both chambers agree to the report and the President then signs the measure. In contrast to Rule XXVIII, which applies to the full text of every conference report, Paragraph 8 of Senate Rule XLIV applies only to provisions of conference reports that would provide for actual spending. In other words, it applies only to discretionary and mandatory spending provisions and not to authorizations of appropriations. Discretionary spending is provided in appropriations acts, and generally funds routine operations of the federal government. Mandatory spending, also referred to as direct spending, is provided in substantive law and generally funds entitlement programs, such as Social Security and Medicare. A hypothetical example can illustrate the difference between the Rule XXVIII "scope" point of order and the Rule XLIV, Paragraph 8, "new directed spending" point of order. The House might pass an appropriations bill providing funding for several specific projects. The Senate might pass this bill with an amendment in the nature of a substitute, and the two houses then could agree to a conference. The conferees might agree to include in the conference report funding for several similar projects that were not listed in the House bill or in the Senate substitute. Under Rule XXVIII, the provision including funding for additional projects would likely be considered to be reasonably related to the matter sent to conference and therefore not subject to a point of order. Under Rule XLIV, Paragraph 8, however, provisions of this kind would likely be interpreted to be "new directed spending provisions" and therefore subject to a point of order. The procedure for disposing of a Rule XXVIII or a Rule XLIV point of order allows the Senate to strike "new matter" or "new directed spending provisions" from the conference report but agree to the rest of the terms of the compromise. Because it is not in order for either chamber to alter the text of a conference report, the rule creates a process that converts the text of the conference compromise minus the "new matter" or "new directed spending provisions" into an amendment between the houses. If the Senate agrees to this amendment, it is then sent to the House for consideration in that chamber. Under the process, a Senator can make a point of order against one or more provisions of a conference report. If the point of order is not waived (see below), the presiding officer rules on whether the provision is in violation of the rule. If a point of order is raised against more than one provision, the presiding officer can make separate decisions regarding each provision. If the presiding officer sustains a point of order against a conference report on the grounds that it violates either the prohibition of "new matter" or "new directed spending provisions," the matter is stricken from the conference recommendation. After all points of order raised under this procedure are disposed of, the Senate will proceed to consider a motion to send to the House, in place of the original conference agreement, a proposal consisting of the text of the conference agreement minus the "new matter" or "new directed spending provision" that was stricken. Amendments to this motion are not in order. The motion to agree to the bicameral compromise with the "new matter" or "new directed spending provision" stricken is debatable "under the same debate limitation as the conference report." Under the regular rules of the Senate, debate on conference reports is not limited. It is limited only if the Senate agrees to limit debate by unanimous consent, if cloture has been successfully invoked on the conference report, or if the Senate is considering the report under expedited procedures established by law (such as the procedures for considering budget resolutions and budget reconciliation measures under the Budget Act). In short, the terms for consideration of the motion to send to the House the proposal without the offending provisions are the same as those that would have applied to the conference report itself. If the Senate agrees to the motion, the conference recommendation as altered by the deletion of the "new matter" or "new directed spending provision" would be returned to the House in the form of an amendment between the houses. The House would then have an opportunity to act on the amendment. The prohibition against amendments to a conference report does not apply to amendments between the houses. Accordingly, the House could, under its procedures, agree to the modified compromise version as it was received from the Senate or offer further amendment(s) thereto. The House could also request a further conference with the Senate or choose to take no action at all on the new compromise language. The procedure for disposing of points of order under either Rule XXVIII or Paragraph 8, Rule XLIV, is similar to that currently followed for disposing of points of order against conference reports under the "Byrd rule" (Section 313(d) of the Congressional Budget Act). The Byrd rule applies only to reconciliation measures, however. Senate rules also create a mechanism for waiving the restrictions on the content of conference reports. The points of order under Rule XXVIII and Paragraph 8 of Rule XLIV can be waived with the support of three-fifths of all Senators duly chosen and sworn (60 Senators if there are no vacancies). Senators can move to waive points of order against one or several provisions, or they can make one motion to waive all possible points of order under either rule. Under these procedures, a motion to waive all points of order is not amendable, but a motion to waive points of order against specific provisions is. As a result, it is possible for a Senator to ensure a vote on waiving all points of order under each rule, and, if successful, no separate motions to waive points of order against individual provisions would be necessary. Time for debate on the motion to waive is limited to one hour and is divided equally between the majority leader and the minority leader or their designees. If the motion to waive garners the necessary support, the Senate is effectively agreeing to keep the matter that is potentially in violation of the rule in the conference report. Motions to waive "scope" (Rule XXVIII) points of order are made and considered separately from motions to waive "new directed spending" (Rule XLIV, Paragraph 8) points of order. The rules further require a three-fifths vote to sustain an appeal of the ruling of the chair and limit debate on an appeal to one hour, equally divided between the party leaders or their designees. The purpose of these requirements is to ensure that either method by which the Senate could choose to apply these rules—through a motion to waive or through an appeal of the ruling of the chair—requires a three-fifths vote of the Senate (usually 60 Senators). A simple majority (51 Senators if there are no vacancies and all Senators are voting) cannot achieve the same outcome. The effect of overturning a ruling of the chair on appeal is quite different from the effect of agreeing to a motion to waive a rule. The decision on an appeal stands as the judgment of the Senate and becomes a precedent for the Senate to follow in future proceedings. A decision to waive the rule, in contrast, does not change the interpretation of the rule in future practice.

Two Senate rules affect the authority of conferees to include in their report matter that was not passed by the House or Senate before the conference committee was appointed. Colloquially, such provisions are sometimes said to have been "airdropped" into the conference report. First, Rule XXVIII precludes conference agreements from including policy provisions that were not sufficiently related to either the House or the Senate version of the legislation sent to conference. Such provisions are considered to be "out of scope" under long-standing Senate rules and precedents. Second, Paragraph 8 of Rule XLIV establishes a point of order that can be raised against "new directed spending provisions," or provisions in a conference report that provide specific items of appropriations or direct spending that were not committed to the conference committee in either the House or Senate versions of the legislation. Both of these restrictions can be enforced on the Senate floor if any Senator chooses to raise a point of order against one or more provisions in a conference report. The process for disposing of either a Rule XXVIII or a Rule XLIV point of order allows the Senate to strike "out of scope matter" or "new directed spending provisions" from the conference report but agree to the rest of the terms of the compromise. It is not in order, however, for either chamber to alter the text of a conference report, and therefore the process converts the text of the conference compromise minus the "new matter" or "new directed spending provisions" into an amendment. If the Senate agrees to this amendment, it is then sent to the House for consideration in that chamber. The points of order under Rule XXVIII and Paragraph 8 of Rule XLIV can be waived with the support of three-fifths of all Senators duly chosen and sworn (60 Senators if there is no more than one vacancy). A figure at the end of the report outlines the procedural steps for disposing of these points of order when they are raised against conference reports.

Policymakers are dedicating considerable attention to greenhouse gas emission reduction, primarily discussing options for carbon dioxide (CO 2 ) emission reduction. Less frequently addressed in proposed legislation is emission reduction for non-CO 2 greenhouse gases, such as nitrous oxide (N 2 O). However, N 2 O reduction efforts have the potential to mitigate climate change. Moreover, N 2 O emission sources may be regulated under the existing Clean Air Act as a class I or class II ozone-depleting substance at the discretion of the Environmental Protection Agency (EPA) Administrator. No new legislation needs to be passed to regulate N 2 O for climate protection and ozone recovery. The five non-CO 2 greenhouse gases regularly monitored but not entirely regulated by EPA (methane, nitrous oxide, hydroflourocarbons, perflourocarbons, and sulfur hexaflouride) accounted for approximately 17% of U.S. greenhouse gas (GHG) emissions in 2009, as measured by total tons of CO 2 equivalent. Nitrous oxide—the third-most abundant greenhouse gas—was responsible for roughly 4% of total U.S. GHG emissions in 2009 by weight. Although they comprise a smaller portion of GHG emissions, non-CO 2 greenhouse gases, including N 2 O, are more potent than CO 2 . The gases identified above are 21 to 23,900 times more effective than an equivalent weight of CO 2 at trapping heat in the atmosphere, with N 2 O being 310 times more potent by weight. In addition to being one cause of greenhouse gas emission growth, N 2 O is an ozone-depleting substance (ODS). Indeed, scientific analysis suggests that N 2 O is now the leading ODS being emitted, as emissions of other substances have been reduced significantly owing to regulations enacted in the late 1980s, in the Montreal Protocol on Substances that Deplete the Ozone Layer. N 2 O emission reduction could thus play a compelling role in recovery of the ozone layer as well as in greenhouse gas emission reduction. The agriculture sector is the primary anthropogenic source of nitrous oxide. The bulk of U.S. N 2 O emissions stem from fertilizing agricultural soils for crop production. Strategies or technologies designated for N 2 O emission reduction are limited. This is partly due to the dispersed nature of N 2 O emission sources. In the agriculture sector, the majority of N 2 O is released as a consequence of specific nitrogen cycle processes (nitrification and denitrification) when large amounts of synthetic nitrogen fertilizers are used for crop production. More efficient application of synthetic fertilizers (e.g., precision agriculture, nitrogen inhibitors, nitrogen sensors, controlled-release fertilizer products) is one way to reduce excess amounts of nitrogen available for bacterial processing and eventual release to the atmosphere as N 2 O. High costs and difficulty in measuring these products' efficacy, among other deterrents, have hampered widespread adoption of practices to reduce N 2 O emissions. This report focuses on the contributions of N 2 O to alteration in the Earth's climate and ozone depletion. Policy options for N 2 O emission reduction, sources of N 2 O, and federal support to lower N 2 O emissions are discussed. Nitrous oxide (N 2 O), familiar to some as "laughing gas," contributes to climate change and ozone depletion. Once released, N 2 O lingers in the atmosphere for decades (its atmospheric lifetime is approximately 114 years) and is 310 times more effective at trapping heat in the atmosphere over a 100-year time frame than carbon dioxide (CO 2 ). N 2 O emission quantity estimates remained fairly constant from 2005 to 2007, hovering around 325 million metric tons carbon dioxide equivalent (CO 2 e). N 2 O emission quantity estimates dropped in 2009 to below 300 million metric tons CO 2 e. See Table 1 . Nitrous oxide is emitted from anthropogenic (manmade) and natural sources. Oceans and natural vegetation are the major natural sources of N 2 O. Agricultural soil management (e.g., fertilization, application of manure to soils, drainage and cultivation of organic soils) is responsible for more than two-thirds of anthropogenic U.S. N 2 O emissions. In 2009, N 2 O emissions from agricultural soil management totaled more than 200 million metric tons of CO 2 e. Other anthropogenic sources of N 2 O are combustion by mobile sources (cars, trucks, etc.), manure management, and nitric acid production. Figure 1 depicts the origination and passage of nitrogen (N) that leads to N 2 O emissions from agricultural soil management. The amount of N 2 O emitted from cropland soils largely depends on the amount of nitrogen applied to a crop, weather, and soil conditions. Corn and soybean crops emit the largest amounts of N 2 O, respectively, due to vast planting areas, plentiful synthetic nitrogen fertilizer applications, and, in the case of soybeans, high nitrogen fixation rates ( Figure 2 ). Comprehension of the nitrogen cycle ( Figure 3 ) is beneficial when crafting policy to reduce N 2 O emissions from anthropogenic sources. Nitrogen, an essential element required by organisms to grow, is found throughout the atmosphere in various forms. The nitrogen cycle portrays the routes in which nitrogen moves through the soil and atmosphere in both organic and inorganic form. Certain processes within the nitrogen cycle convert the nitrogen into a form that can be taken up by plants. Four of the major processes are: nitrogen fixation—conversion of nitrogen gas (N 2 ) to a plant-available form; nitrogen mineralization—conversion of organic nitrogen to ammonia (NH 3 ); nitrification—conversion of ammonia (NH 3 ) to nitrate (NO 3 -) via oxidation (that is, by being combined with oxygen); and denitrification—conversion of nitrates back to nitrogen gas. Nitrous oxide is a byproduct of nitrification and denitrification. Both processes occur naturally. Excess application of nitrogen fertilizer can lead to increased nitrification, which can cause nitrate to leach into groundwater or surface runoff (in turn, this causes eutrophication, which can damage aquatic environments). N 2 O emission mitigation options are available for agricultural soil management and nitric acid production. Nitric acid is a chemical compound used to make synthetic fertilizers. N 2 O abatement options for nitric acid production include a high-temperature catalytic reduction method, a low-temperature catalytic reduction method, and nonselective catalytic reduction. The estimated reduction efficiencies (the percentage reduction achieved with adoption of a mitigation option) are 90%, 95%, and 85%, respectively. Agricultural soil management mitigation options recommended by researchers and technology transfer specialists to discourage excess application of nitrogen fertilizers and soil disturbance ( Table 2 ) are not generally being practiced. Fertilizer and soil best-management practices aim to provide the crop with the nutrient and soil conditions necessary for crop production, and prevent nutrient and soil loss from the crop field (e.g., erosion, leaching). Some may consider less money spent towards fertilizer use an economic incentive for agricultural producers. Others may want to ensure that crop yields meet expected feed, fiber, and fuel mandates (e.g., for corn ethanol), which may be difficult to attain with less fertilizer use. Monitoring reduced nitrogen fertilization applications on a large scale for greenhouse gas emission reduction purposes may be difficult; it is not clear how such a program could be managed at a national level. Enforcement options could include voluntary verification, third-party verifiers, or government intervention. Reporting N 2 O emissions from agricultural soil management was not included in the Final Mandatory Reporting of Greenhouse Gases Rule issued by EPA on September 22, 2009. EPA's reasoning behind this decision was that no low-cost or simple direct N 2 O measurement methods exist. Additionally, EPA released a proposed rule requiring new or modified facilities that could trigger Prevention of Significant Deterioration (PSD) permitting requirements to apply for a revision to their operating permits to incorporate the best available control technologies and energy efficiency measures to minimize GHG emissions. USDA provides some financial and technical assistance for nutrient management through its conservation programs. Moreover, USDA's Agricultural Research Service (ARS) is studying the relationship between agricultural management practices and nitrous oxide emissions. In addition to the agriculture sector, work is being done in the transportation sector to reduce N 2 O emissions. Mobile combustion was responsible for roughly 8% of N 2 O emissions reported in 2009. One N 2 O emission reduction effort, proposed by EPA and the Department of Transportation, is a per-vehicle N 2 O emission standard of 0.010 grams per mile effective in model year 2012 for all light-duty cars and trucks as part of a wider effort to reduce greenhouse gas emissions and improve fuel economy in tandem. EPA has allocated financial resources to quantify N 2 O emissions for the greenhouse gas inventory (e.g., DAYCENT model). Congress has begun to investigate the reduction of non-CO 2 greenhouse gas emissions, including N 2 O emissions, as one strategy to mitigate climate change. Some contend that N 2 O emissions reduction could serve as a short-term response in the larger, long-term scheme of mitigation and adaptation efforts. It may be viewed as a short-term response because N 2 O emissions make up a small amount of the GHG inventory compared to CO 2 emissions. Any substantial approach to mitigate climate change is likely at some point to have to address sources that emit CO 2 . Congress could approach N 2 O emissions reduction as part of a comprehensive GHG emission strategy offering economically attractive abatement alternatives to discourage actions leading to climate change. For example, a cap or fee on N 2 O emissions could spur innovative methods for agricultural producers to limit excess synthetic fertilizer application. Congress could also examine the tools necessary to identify N 2 O emission abatement options, assess their cost, and determine their economic impact for full incorporation into climate change legislation. Besides greenhouse gas emission reduction, reducing N 2 O emissions could lead to ozone recovery. Congress could explore the co-benefits that may arise from restricting N 2 O emissions for climate change purposes. N 2 O is not regulated as an ODS under the Clean Air Act, Title VI, Stratospheric Ozone Protection (as guided by the Montreal Protocol). As emissions of other ODSs (e.g., chlorofluorocarbon-11, halon-1211) have declined due to regulation, N 2 O has emerged as the dominant ODS emission. The first-ever published ozone depletion potential (ODP) value assigned to N 2 O, 0.017, is less than the ODP value of 1.0 for the reference gas chlorofluorocarbon 11 (CFC-11). While some may not see a cause for alarm based on the ODP value alone, the quantity of N 2 O emissions and its potency as a GHG can lead to serious harm (see Table 1 ). The ODP value for N 2 O does not allow for its mandatory inclusion as a class I substance for regulation under the Clean Air Act. However, N 2 O could be listed as a class II substance at the direction of the EPA Administrator or regulated under Section 615 of the act. Class I substances have an ODP of 0.2 or more and are more harmful to stratospheric ozone molecules than Class II substances, which have an ODP of less than 0.2. With or without ODP substance listing, Congress may find it useful to incorporate the ozone depletion impacts of N 2 O into its climate change policy proposals both to reduce greenhouse gas emissions and to further ozone recovery achievements. Classifying N 2 O emission reduction as an eligible offset type, including N 2 O as a covered entity within a cap-and-trade program, or directing EPA to use existing authority under the Clean Air Act to regulate N 2 O are other available options to reduce N 2 O emissions for ozone or climate protection. Any option chosen to reduce N 2 O emissions will more than likely require an improvement of N 2 O estimation, measurement, and reporting methods and possible financial incentives. Congress could apply lessons learned from previous international agreements that are intended to abolish harmful compounds. The outcomes of the Montreal Protocol, put into action in the late 1980s, may prove useful to Congress in understanding the long-term implications of certain climate change policy options, specifically cap-and-trade. A number of gases were phased out under the Protocol, which allowed for each country to establish a regulatory framework to monitor and reduce ODSs. Certain ozone-depleting substances, such as N 2 O, were not included in the Protocol partly because their threat was not perceived as urgent at the time. However, one unintended consequence of the success of the Protocol reducing targeted ODSs is that N 2 O has emerged as the leading ODS.

Gases other than carbon dioxide accounted for approximately 17% of total U.S. greenhouse gas emissions in 2009, yet there has been minimal discussion of these other greenhouse gases in climate and energy legislative initiatives. Reducing emissions from non-carbon dioxide greenhouse gases, such as nitrous oxide (N2O), could deliver short-term climate change mitigation results as part of a comprehensive policy approach to combat climate change. Nitrous oxide is 310 times more potent than carbon dioxide in its ability to affect the climate; and moreover, results of a recent scientific study indicate that nitrous oxide is currently the leading ozone-depleting substance being emitted. Thus, legislation to restrict nitrous oxide emissions could contribute to both climate change protection and ozone recovery. The primary human source of nitrous oxide is agricultural soil management, which accounted for more than two-thirds of the N2O emissions reported in 2009 (approximately 205 million metric tons CO2 equivalent). One proposed strategy to lower N2O emissions is more efficient application of synthetic fertilizers. However, further analysis is needed to determine the economic feasibility of this approach as well as techniques to measure and monitor the adoption rate and impact of N2O emission reduction practices for agricultural soil management. As the 112th Congress considers legislation that would limit greenhouse gas emissions, among the issues being discussed is how to address emissions of non-CO2 greenhouse gases. Whether such emissions should be subject to direct regulation, what role EPA should play using its existing Clean Air Act authority, and what role USDA should play in any N2O reduction scheme are among the issues being discussed. How these issues are resolved will have important implications for agriculture, which has taken a keen interest in climate change legislation.

H.R. 157 / S. 160 , the District of Columbia House Voting Rights Act of 2009 introduced in the 111 th Congress, provided for a permanent increase in the size of the U.S. House of Representatives, from 435 seats to 437 seats. The bills specified that one of the additional seats was to be allocated to the District of Columbia while the other seat was to be assigned either by using the normal apportionment formula allocation procedure ( H.R. 157 ) or specifying that the seat would be allocated to Utah, the state which would have received the 436 th seat under the 2000 apportionment process. Thus, this would add a fourth seat to Utah's three ( S. 160 ). While both versions treated the District of Columbia as if it were a state for the purposes of the allocation of House seats, each bill restricted the District of Columbia to a single congressional seat under any future apportionments. Similar bills had been introduced in the 110 th Congress. On April 19, 2007, the House approved H.R. 1905 (a revised version of H.R. 1433 ) by a vote of 241 to 177 (Roll Call vote 231) and sent it to the Senate for consideration. On June 28, 2007, S. 1257 was reported out of the Senate Committee on Homeland Security and Governmental Affairs with amendments. On September 18, 2007, cloture on the motion to proceed to consideration of the measure was not invoked in the Senate on a Yea-Nay vote, 57 - 42, leaving the measure pending. No further action occurred on the legislation. The 435 seat limit for the size of the House was imposed in 1929 by statute (46 Stat. 21, 26-27). Altering the size of the House would require a new law setting a different limit. Article I, §2 of the Constitution establishes a minimum House size (one Representative for each state), and a maximum House size (one for every 30,000 persons, or 10,306 representatives based on the 2010 Census). For the 2010 apportionment, a House size of 468 would have resulted in no state losing seats held from the 112 th to the 116 th Congresses. However, by retaining seats through such an increase in the House size, other state delegations would become larger. At a House size of 468, California's delegation size, for example, would be 56 instead of 53 seats, Texas's delegation size would be 38 instead of 36 seats, and Florida's delegation size would be 29 instead of 27 seats. General congressional practice when admitting new states to the Union has been to increase the size of the House, either permanently or temporarily, to accommodate the new states. New states usually resulted in additions to the size of the House in the 19 th and early 20 th centuries. The exceptions to this general rule occurred when states were formed from other states (Maine, Kentucky, and West Virginia). These states' Representatives came from the allocations of Representatives of the states from which the new ones had been formed. When Alaska and Hawaii were admitted in 1959 and 1960 the House size was temporarily increased to 437. This modern precedent differed from the state admission acts passed following the censuses in the 19 th and early 20 th centuries which provided that new state representatives would be added to the apportionment totals. The apportionment act of 1911 anticipated the admission of Arizona and New Mexico by providing for an increase in the House size from 433 to 435 if the states were admitted. As noted above, the House size was temporarily increased to 437 to accommodate Alaska and Hawaii in 1960. In 1961, when the President reported the 1960 census results and the resulting reapportionment of seats in the reestablished 435-seat House, Alaska was entitled to one seat, and Hawaii to two seats. Massachusetts, Pennsylvania and Missouri each received one less seat than they would have if the House size had been increased to 438 (as was proposed by H.R. 10264, in 1962). Table 1 , below displays the apportionment of the seats in the House of Representatives based on the 2000 Census apportionment population (the current House apportionment) and the apportionment of seats in the House based on the 2010 Census apportionment population (the distribution of seats among the states for the 113 th Congress). In addition, Table 1 also shows the impact on the distribution of seats in the House if the District of Columbia were to be treated as if it were a state for apportionment purposes for both a House size of 435 seats and a House size of 437 seats. First, due to population changes between the 2000 Census and the 2010 Census, Table 1 shows a shift of 12 seats among 18 states for the 113 th Congress (beginning in January 2013). Illinois, Iowa, Louisiana, Massachusetts, Michigan, Missouri, New Jersey, and Pennsylvania will each lose one seat; New York and Ohio will each lose two seats. Arizona, Georgia, Nevada, South Carolina, Utah, and Washington will each gain one seat; Florida will gain two seats; and Texas will gain four seats. These are the actual seats to be allocated based on the results of the 2010 Census. Second, if the District of Columbia were to be given a vote in the House of Representatives and treated as if it were a state in the reapportionment of congressional seats following the 2010 census, and the House size remained at 435, Minnesota would lose a seat relative to what it is scheduled to get as a result of the 2010 Census. Thus, Minnesota's delegation would fall to seven Representatives if the District of Columbia were to given a vote and the House size remained at 435 Representatives. Third, if, on the other hand, the District of Columbia were to be given a vote in the House of Representatives and treated as if it were a state and the House size were to be increased to 437, the District of Columbia would receive one Representative and North Carolina would be entitled to fourteen Representatives, one more than the state is scheduled to receive in the apportionment following the 2010 census. Also, Minnesota would retain its eighth seat and no other state would be affected by the change. Another way to see the impact is to examine the allocation of the last seats assigned to the states when the District of Columbia is allocated a seat (presumably the 51 st seat). The actual apportionment is done through a "priority list" calculated using the equal proportions formula provided in 2 U.S.C. §2a.(a). Table 2 , below, displays the end of the priority list that was used to allocate Representatives based on the 2010 Census, including the District of Columbia. The law only provides for 435 seats in the House, but the table illustrates not only the last seats assigned by the apportionment formula (ending at 435), but the states that would just miss getting additional representation. Table 3 is similar to Table 2 , in that it displays the end of the priority list, but the last seat is 437 instead of 435. The priority values and the population needed to gain or lose a seat do not change if DC is treated like state, as DC is entitled the constitutional minimum of one Representative.

Two proposals (H.R. 157/S. 160, District of Columbia House Voting Rights Act of 2009) were introduced in the 111th Congress to provide for voting representation in the U.S. House of Representatives for the residents of the District of Columbia (DC). H.R. 157/S. 160, for purposes of voting representation, treated the District of Columbia as if it were a state, giving a House seat to the District, but restricting it to a single seat under any future apportionments. The bills also increased the size of the House to 437 members from 435, and gave the additional seat to the state that would have received the 436th seat under the 2000 apportionment, Utah. This report shows the distribution of House seats based on the 2010 Census for 435 seats and for 437 seats as specified in the proposal. North Carolina, which would receive the 436th seat in the 2010 apportionment is substituted for Utah, assuming that any new, similar legislation would adopt the same language as H.R. 157.

Congressional authorization of federal assistance to state and local governments can be traced as far back as 1808, when the first federal grant program was adopted to provide funds to states to support the National Guard. Since that time, there has been significant growth in the number of federal assistance programs to state and local government. There are currently over 2,321 congressionally authorized federal assistance programs. The growing number, perceived fragmentation, and complexity of these programs create challenges for federal agencies and congressional stakeholders in standardizing various financial and administrative aspects of federal grant program management. Federal agencies administering grant programs face challenges in providing timely, accurate, and detailed information on federal grant awards. This can be attributed, in part, to the way grant funds are distributed from the federal to the local level. This may also be attributed to the limitations of the databases used to track the distribution of federal grant funds. These limitations include questions regarding the validity of the data, and the limited ability to track the distribution of grant funds to the subgrant recipient level. Without complete and valid information about the distribution of federal grant funds, Congress may have a diminished capacity to engage in effective oversight of federal grants. Federal grant recipients are currently required to report grant project related information to federal agencies. This information is contained within a number of federal grant databases with limited public accessibility. The information reported by grant recipients varies depending on the federal program and the individual grant award. Federal grants are available for a variety of purposes. Federally funded grant projects may include purchasing fire and police equipment, constructing housing for low-income populations, providing disaster recovery assistance and other social services, and funding educational activities. Organizations generally coordinate the application and administration of federal grants, and individuals are beneficiaries of the grant projects and services provided by organizations. Organizations seeking federal grant funds are required to register in federal grant systems prior to applying for federal grants. Once grant funds are awarded, recipients are required to report information to federal agencies regarding the use of the federal grant funds. The information provided to the federal government by federal grant recipients is contained in several different federal databases. The general public has access to selected information contained in these databases. This report provides an introduction to reporting requirements placed on federal grant recipients, including requirements that must be met to seek federal grant funds. It also describes the types of information collected on grant recipients, the databases containing information about grant awards, and the availability of that information to the public. The reporting requirements discussed in this report are financial reporting requirements for grant recipients and do not include performance related reporting. To comply with guidance issued by the Office of Management and Budget (OMB), federal agencies that administer federal grant programs must collect and report financial grant data to federal grant databases. Federal agencies collect the grant data by requiring federal grant recipients to submit financial and performance data to the federal agency administering the grant program. These reporting requirements are set forth in the authorizing statutes and regulations for each individual grant program. Some reporting requirements, such as post-award audit requirements, are set forth in legislation that applies to almost every federal grant program. A federal grant seeker must provide information about their organization when they obtain a DUNS number and register with SAM. Grant seekers must provide the following information to obtain a DUNS number: legal name of the company, organization, or entity; entity headquarters name and address; secondary, or tradestyle, name of the company or the "Doing Business As" (DBA) name; physical address of the entity including city, street, and zip code; mailing address; telephone number; point of contact name and title; and, number of employees at the physical location. To register with SAM, grant seekers must provide the following information: DUNS number; business information, including the taxpayer identification number (TIN); Commercial and Government Entity (CAGE) code; business type and organization structure; financial information including electronic funds transfer (EFT) information for federal government payment purposes; answers to executive compensation questions; and, Point of Contact (POC) information including name, title, physical address, and email address. Federal agencies use a number of systems to track federal grant recipient data. Before a federal grant is awarded, officials seeking federal grants for their organization are required by law to obtain a unique identifier assigned and maintained by Dun and Bradstreet (D&B). This unique identifier is known as a Data Universal Numbering System (DUNS) number. Federal agencies use the DUNS number to identify federal grant applicants. Once a grant seeker obtains a DUNS number, the organization must register in the System for Award Management (SAM) in order to be eligible to apply for federal grants. Federal agencies use SAM to collect additional information on potential federal grant recipients. Each federal grant award is assigned a number that is then associated with the grant recipient. Federal agencies use the award number to track grant data in agency grant management and financial management systems. When Congress authorizes a federal grant program, the federal agency administering the grant program reports grant program information to the Catalog of Federal Domestic Assistance (CFDA). After a federal grant award is made, the federal agency that made the award collects information about the grant recipient and the grant project. The information provided in a federal grant application is inputted by the federal agency into the grant management system within the agency and a unique grant award number is created. A single entity who has received more than one award under the same grant program may have several grant award numbers. Additionally, a federal agency may have a separate grant management system for each grant program it administers. When the grant agreement is executed, the federal agency also creates a grant account in the agency's cash management system for each individual grant award, which may mean that a single entity that receives more than one grant award by an agency may have several different grant account numbers. Federal grant recipients are required to report financial information pursuant to the conditions contained in the grant agreement executed at the time of the grant award. This information includes financial information, such as expenditures, about the project or services funded by the federal grant award. The financial information is reported periodically to the federal agency administering the grant program. Financial data on the grant award are reported into several federal grant databases, including the following: federal agency cash management systems; Federal Assistance Award Data System PLUS (FAADS-PLUS); Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS); USAspending.gov; and, Federal Audit Clearinghouse (FAC). As detailed in Figure 1 , federal grant data are located in several databases at both the grant recipient and federal government level. A Data Universal Numbering System (DUNS) number is a unique nine-digit identifier for each government contractor and federal grant applicant. The federal government has contracted with D&B since 1978 to provide proprietary DUNS numbers for use in government-wide data systems, and since October 1, 2003, the OMB policy requires the use of a DUNS number on any application for federal grants or cooperative agreements. DUNS numbers are associated with contractor and grant recipient information and are required for each listed organization address. The System for Award Management (SAM) is the federal government's primary contractor and federal grant applicant database used by agencies to validate grantee information. Current and potential government contractors and grant applicants are required to register with SAM in order to be awarded federal government contracts or grants. SAM requires a one-time registration from each potential government vendor, and collects basic procurement and financial information from contractors and grant applicants. SAM consolidates government-wide acquisition and grant award support systems into one new system. The consolidation is planned for four phases. In 2012 the first phase of SAM was launched and phase one systems continue to be consolidated. The first phase of the consolidation included nine information databases: Central Contractor Registration (CCR), Federal Agency Registration (FedReg), Online Representations and Certifications Application (ORCA), and Excluded Parties List System (EPLS). Once completed, the consolidation will also include: Electronic Subcontracting Reporting System (eSRS); FFATA Sub-award Reporting System (FSRS); Catalog of Federal Domestic Assistance (CFDA); FedBizOpps.gov (FBO); Wage Determination Online (WDOL); Federal Procurement Data System-Next Generation (FPDS-NG); Past Performance Information Retrieval System (PPIRS); Contractor Performance Assessment Reporting Systems; and Federal Awardee Performance and Integrity Information System (FAPIIS). Some of the systems that will be consolidated by SAM include data on federal contractors and may not necessarily contain information on federal grant recipients. The Catalog of Federal Domestic Assistance (CFDA) is a publicly searchable reference source for federal grants and nonfinancial assistance programs. The CFDA lists and describes over 2,300 federal programs and includes program-specific information such as program objectives, eligibility requirements, application and award processes, program contact information, and related CFDA assistance programs. CFDA is continuously updated and enables information seekers to search assistance programs by keyword, subject, funding department or agency, and other criteria. Additionally, CFDA provides sources of information on developing and writing grant applications, guidance to review processes, and links to agency and department websites for more in-depth program information and eligibility explanations. The CFDA is maintained by the General Services Administration (GSA) pursuant to the Federal Program Information Act. However, OMB is responsible for the collection of assistance program information from federal agencies. OMB also issues guidance to federal agencies for establishing procedures to ensure accurate and timely data is contained within CFDA. Cash management in this context refers to the methods and procedures used by grant recipients and federal agencies to transfer grant funds. Financial management systems of federal agencies and grant recipients are payment and cash management systems used to track the flow of cash between the federal government and primary grant recipients and sub-grant recipients. As detailed in Figure 1 , each federal agency and each grant recipient may have separate cash management systems, resulting in limited interoperability between cash management systems. The Federal Funding Accountability and Transparency Act of 2006 (FFATA, P.L. 109-282 ) requires that federal contract, grant, loan, and other financial assistance awards of more than $25,000 be displayed on a searchable, publicly accessible website, USAspending.gov. USAspending.gov provides information on grant awards, including the amount of the award, name and location of the recipient, and the name and authorization of the federal program used to make the award. The Digital Accountability and Transparency Act of 2014 (DATA Act, P.L. 113-101 ) amended FFATA, transferring responsibility for USAspending.gov from OMB to the Department of Treasury, Bureau of the Fiscal Service. On March 31, 2015, USAspending.gov was re-launched with changes to the site's usability, presentation, and search functions. The Federal Assistance Awards Data System (FAADS) was established by the Consolidated Federal Funds Report Act of 1982 ( P.L. 97-326 ) and was maintained by the Bureau of the Census in the Department of Commerce. FAADS was a central collection source of Federal financial assistance awards transactions. FAADS-PLUS was introduced in 2007, a result of passage of the FFATA, and is an expanded version of FAADS. FFATA requires prime subgrant recipients receiving a grant award greater than $25,000 to report subaward financial information. The FFATA Subaward Reporting System (FSRS) is the reporting tool used by prime awardees to meet FFATA sub-award reporting requirements. The reported subaward FSRS information is then displayed on USAspending.gov under the prime award information. The Single Audit Act Amendments of 1996 ( P.L. 104-156 ) and OMB guidance stipulate that all grant recipients expending $750,000 or more in federal awards be required to submit an annual single audit detailing award expenditures. The Federal Audit Clearinghouse (FAC) serves as a public database of all audits conducted and submitted and is maintained by OMB. Within the FAC, audits detailing award and expense information are searchable by organization or institution, geographic location, or CFDA program number. As shown in Figure 1 , several databases contain federal grant information. However, grant data contained within cash management systems, grant management systems, FAADS-PLUS, and FSRS are not accessible or searchable by the general public. The federal government has created several data systems and websites to access the systems that are accessible and searchable by the public. These include the following: Catalog of Federal Domestic Assistance ( http://www.cfda.gov ); USAspending.gov ( http://www.usaspending.gov ); Dun and Bradstreet ( http://fedgov.dnb.com/webform ); System for Award Management ( http://www.sam.gov ); and Federal Audit Clearinghouse ( https://harvester.census.gov/fac/ ). Of the above reporting requirements for federal grant applicants, two databases allow opting out of providing publically searchable information: the Dun and Bradstreet (D&B) DUNS number database and SAM. To avoid having a public DUNS number, applicants must first obtain a DUNS number, and then discuss their individual privacy concerns with the D&B government support desk. D&B can withhold the DUNS number from their public database. However, the applicant's DUNS number remains visible to any institution with a DUNS Business Locator subscription, as well as within the required SAM grant application record, unless the opt-out process for SAM is also completed. Grant applicants can opt out of the requirement that information collected during the SAM registration be visible to the public, though the information may still be viewable by certain users: Entities that have opted out will be removed only from the SAM public search, but will still be visible to users with For Official Use Only data access and will be provided in accordance with Freedom of Information Act (FOIA) requests. Please note that your banking information is treated as sensitive data and will not be displayed to the public regardless of your selection.

Congress and federal agencies frequently undertake initiatives to conduct oversight of federal grant programs and expenditures. The ability to oversee is influenced by the existing reporting requirements placed on recipients of federal grant funds. Limitations in accessing information contained in federal databases used to collect grant data also influence the level of transparency into the use of federal grant funds. Congress has also debated the reporting burden placed on federal grant recipients and how to balance grant recipient capacity with the desire for transparency into the use of federal grant funds. This report provides an introduction to reporting requirements placed on federal grant recipients, including requirements that must be met to seek federal grant funds. It also describes the databases containing information about grant awards, the types of information collected on grant recipients, and the availability of that information to the public. Several grant reporting questions are answered, including the following: Why are federal agencies and grant recipients required to report grant data? What information is a federal grant recipient required to report and to whom? How does a federal agency track federal grant data? What is the Data Universal Numbering System (DUNS) number? What is the System for Award Management (SAM)? What is the Catalog of Federal Domestic Assistance (CFDA)? What are cash management systems? What is USAspending.gov? What is the Federal Assistance Award Data System PLUS (FAADS-PLUS)? What is the Federal Funding Accountability and Transparency Act Subaward Reporting System? What is the Federal Audit Clearinghouse (FAC)? What grant data are accessible by the public? Federal grant reporting requirements fall into two categories: financial reporting and program performance reporting. This report focuses on financial reporting requirements and does not address program performance reporting. This report will be updated should significant legislative activity regarding federal grant recipient reporting occur.

Figure 1 and Table 1 show bankruptcy filings since 1980. Business filings peaked in 1987, but the number of consumer filings continued to grow through 2005. In that year, the number of filings surpassed 2 million—there was a "rush to the courthouse" before the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA; P.L. 109-8 ) took effect in October 2005. In 2006, filings dropped sharply, suggesting that the new law caused many to accelerate their filings, and that many petitions that would have been filed in 2006 (or later) were pushed forward by bankruptcy reform. Whether BAPCPA will reduce filings in the long run is still unclear. Filings rose steadily from the 2006 lows until 2010, when they exceeded 1.5 million, which was approximately the level during the four years before BAPCPA. Over the first three quarters of 2011, there was a slight decline from the year-earlier numbers. Table 2 shows figures on household debt. The major categories of household debt are mortgage debt and consumer credit, which together comprise about 97% of all household indebtedness. Consumer credit consists of (1) revolving credit, or credit card debt, and (2) non-revolving debt, which is dominated by auto and college loans (though it also includes loans for boats, mobile homes, vacations, and so on). Mortgage debt is borrowing secured by real estate. A subcategory within mortgage debt, home equity lending, is broken out in the table because it may substitute for consumer credit in many cases. Table 2 also includes Federal Reserve estimates of the burden of debt service—that is, the percentage of household disposable income that goes to repay loans. Over the past decade, this measure rose steadily (but not dramatically), until the recession and financial crisis that began in 2007. The debt burden figures in Table 2 fluctuate within a fairly narrow range: from 10.80% to 13.93%. (During the 1980s, the range was similar: from 10.6% to 12.5%.) Although the burden of debt has risen since the 1980s, the increase has been gradual and would not appear to explain much of the fivefold increase in personal bankruptcy filings over the past two decades. Moreover, the decline in the debt service ration since 2007 has not been accompanied by a significant reduction in bankruptcy rates. Interest rates paid by consumers—particularly mortgage rates—declined in recent years to the lowest levels since the 1950s, and they remain low. The relative stability of the debt burden in the face of falling and historically low interest rates implies that the ratio of debt outstanding to income has been rising. This ratio—the sum of consumer and mortgage debt expressed as a percentage of disposable personal income—is shown in the far right column of Table 2 . The increases in this figure, which between 1990 and 2007 rose more than twice as fast as the debt burden, suggest that further increases in bankruptcy filings (and perhaps problems for lenders) may lie ahead if interest rates should rise suddenly or unexpectedly. Since 1980, however, declining interest rates have permitted households to take on more debt without a comparable increase in the interest payments required to service that debt. The aggregate household debt numbers mask important differences among families: some have done very well in the long booms of the 1980s and 1990s, while others have taken on debt that they have difficulty repaying. Table 3 below, based on the Federal Reserve's Survey of Consumer Finances, shows the percentages of families at various income levels that devote more than 40% of their income to debt service, for selected years from 1995 through 2007. Two noteworthy facts emerge from the data in Table 3 . The first is the high rate of distress among lower-income families, who are the most likely to file for bankruptcy. Second, like the debt burden figures shown in Table 2 , there is no sharply rising trend that would explain the dramatic increase in personal bankruptcy filings. The percentage of all families in distress in 2007 was little changed from the 1998 level. The 2007 figures do show a notable increase among families in the upper income percentiles; this may be attributable to increased mortgage debt taken on during the housing boom that ended in that year. The question remains why so many families at or below the national median income take on high levels of debt and end up in bankruptcy court. Some explanations focus on particularly vulnerable populations: the sick and uninsured (or underinsured), the divorced, or residents of states without mandatory uninsured motorist coverage. Supporters of the bankruptcy reform measure finally enacted in 2005 argued that the bankruptcy code was too debtor-friendly and created an incentive to borrow beyond the ability to repay, or in some cases without the intention of repaying. Opponents of reform claimed that financial distress is often a by-product of the marketing strategies of credit card issuers and other consumer lenders. Lack of a consensus explanation for the rise in consumer bankruptcy filings suggests that the issue will remain controversial. In December 2007, the U.S. economy went into recession, in the midst of global financial panic. Household debt levels began to fall in three of the four categories shown in Table 2 . The decline in debt balances continued for 11 calendar quarters, until debt outstanding rose slightly in the second quarter of 2011. In the third quarter, debt levels fell again. On a percentage basis, home equity and credit card debt led the decline, as shown in Table 4 . In dollar terms, however, mortgage debt (other than home equity loans) accounted for most of the drop. Several factors appear to have contributed to the fall in debt balances. Some households may be paying down their debt, others may be borrowing less, and the amount of debt written off by lenders as uncollectible has increased. Some lenders have tightened their credit standards for new loans. Mortgage balances have fallen because of mortgage modifications or other negotiations that reduce principal outstanding, and because foreclosed homes are often sold for less than the amount of the old mortgage. Causes and implications of deleveraging are discussed in CRS Report R41623, U.S. Household Debt Reduction , by [author name scrubbed].

The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA; P.L. 109-8) included the most significant amendments to consumer bankruptcy procedures since the 1970s. Bankruptcy reform was enacted in response to the high number of consumer bankruptcy filings, which in 2004 and 2005 reached five times the level of the early 1980s. Why did filings increase so dramatically during a period that included two of the longest economic expansions in U.S. history? Because bankruptcy is by definition a condition of excessive debt, many would expect to see a corresponding increase in the debt burden of U.S. households over the same period. However, while household debt has indeed grown, debt costs as a percentage of income have risen only moderately. What aggregate statistics do not show is that the debt burden does not fall evenly on all families. Financial distress is common among lower-income households: in 2007, 27% of families in the bottom fifth of the income distribution spent more than 40% of their income to repay debt. Following the effective date of BAPCPA, in October 2005, there was a sharp reduction in the number of bankruptcy filings, reflecting the "rush to the courthouse" in the months before the new law took effect. Since the 2006 lows, the number of filings has risen steadily. In 2010, personal bankruptcy filings reached 1.5 million, roughly equal to the pre-BAPCPA level. It appears that BAPCPA has not produced the effect its supporters hoped for—a substantial and permanent reduction in the rate of consumer bankruptcy. With the recession that began in December 2007, the long-term upward trend in consumer indebtedness was interrupted. Beginning in the middle of 2008, the amount of debt held by U.S. households declined for 11 consecutive quarters. Through the third quarter of 2011, households reduced their debt burden by $853 billion, or 6.5%. Causes and implications of this trend are discussed in CRS Report R41623, U.S. Household Debt Reduction, by [author name scrubbed]. This report presents statistics on bankruptcy filings, household debt, and families in financial distress. It will be updated as new statistics become available.

The genesis of the Religious Freedom Restoration Act (RFRA) lies in the Supreme Court's decision in Employment Division, Oregon Department of Human Resources v. Smith . In that case, decided in 1990, the Court narrowed the scope of the Free Exercise Clause of the First Amendment, which provides that "Congress shall make no law ... prohibiting the free exercise [of religion]." The specific issue before the Court in Smith was whether two Native Americans who had been fired from their jobs as drug counselors after they were discovered to have ingested peyote in a ritual of the Native American Church were eligible for state unemployment benefits. The Court determined that they were not, and in so doing also altered the standard of review generally used for free exercise cases. Before Smith , the Court had generally applied a strict scrutiny test to government action that allegedly burdened the exercise of religion. That test required the government to show that an action burdening religion served a compelling government interest and that no less burdensome course of action was feasible. If the government could not so demonstrate, the test required that the religious practice be exempted from the government regulation or prohibition at issue. In Smith , the Court abandoned the strict scrutiny test and held that religiously neutral laws may be uniformly applied to all persons without regard to any burden or prohibition placed on their exercise of religion. The Free Exercise Clause, the Court said, never "relieves an individual of the obligation to comply with a 'valid and neutral law of general applicability' on the ground the law proscribes (or prescribes) conduct that his religion prescribes (or proscribes)." In the case at hand, that new standard meant that the Free Exercise Clause mandated no religious exemption from Oregon's drug laws for Native American use of peyote in a sacramental ceremony and, consequently, no eligibility for unemployment benefits of the two Native Americans who lost their jobs because of their participation in such a ceremony. More generally, the Court asserted that the question of whether religious practices ought to be accommodated by government was a matter to be resolved by the political process and not by the courts, although it admitted that "leaving accommodation to the political process will place at a relative disadvantage those religious practices that are not widely engaged in...." In 1993, Congress enacted the Religious Freedom Restoration Act (RFRA) to restore the compelling interest test set forth in earlier cases in all circumstances where the freedom of religious exercise is being burdened and to provide a claim for relief when the government substantially burdens the religious exercise. Thus, RFRA granted government the right to substantially burden a person's exercise of religion only if it demonstrates that application of the burden to the person is (1) in furtherance of a compelling governmental interest and (2) the least restrictive means of furthering that compelling governmental interest. O Centro Espirita Beneficente Uniao do Vegetal (UDV) is a religious sect with origins in the Amazon Rainforest in which members of the church receive communion by drinking a sacramental tea containing a hallucinogen ( hoasca ) regulated under the Controlled Substances Act by the federal government. In 1999, federal agents seized a shipment of hoasca from Brazil that was to be used in UDV ceremonies. The church challenged the seizure and requested a preliminary injunction to prevent the further seizure of hoasca or the arrest of any UDV members using the drug. The complaint alleged that the application of the Controlled Substances Act to the church's sacramental use of hoasca violated RFRA. At a hearing on the preliminary injunction, the government conceded that the application of the Controlled Substances Act would substantially burden a sincere exercise of religion by the UDV, but argued that there was no RFRA violation because the application of the Controlled Substances Act was "the least restrictive means of advancing three compelling governmental interests: protecting the health and safety of UDV members, preventing the diversion of hoasca from the church to recreational users, and complying with the 1971 United Nations Convention on Psychotropic Substances, a treaty signed by the United States and implemented by the [Controlled Substances] Act." The district court found that the government had failed to "demonstrate a compelling interest justifying what it acknowledged was a substantial burden on the UDV's sincere religious exercise." The court entered a preliminary injunction prohibiting the government from enforcing the Controlled Substances Act with respect to the UDV's importation and use of hoasca . The injunction required the church to import hoasca pursuant to federal permits, to restrict control of the church's supply of hoasca to persons of church authority, and to warn members of the dangers of hoasca . The government appealed the issuance of the injunction, and a panel of the United States Court of Appeals for the Tenth Circuit affirmed, as did a majority of the Circuit sitting en banc. The government appealed to the Supreme Court. In making its appeal, the government put forth three arguments challenging the lower court's decision. First, it challenged the preliminary injunction itself, alleging that the court used the wrong test for determining whether a preliminary injunction was proper. Second, it argued that enforcement of the Controlled Substances Act precluded any type of waiver for UDV. Third, it argued that compliance with the United Nations Convention on Psychotropic Substances also prevented it from allowing UDV to use hoasca , a substance covered under the convention. The government did not challenge the district court's factual findings or its conclusion that the evidence presented at the hearing regarding health risks and risk of diversion was "in equipoise" and "virtually balanced." Rather, the government challenged the district court's determination that evidence "in equipoise" was sufficient for issuing a preliminary injunction against enforcement of the Controlled Substances Act. On appeal, the government noted "the well-established principle that the party seeking pretrial relief bears the burden of demonstrating a likelihood of success on the merits." The government argued that a "mere tie in the evidentiary record" was insufficient for issuing a preliminary injunction. Along with a majority of the en banc Court of Appeals, the Supreme Court rejected this argument, finding that the government "failed to demonstrate that the application of the burden to the UDV would, more likely than not, be justified by the asserted compelling interest." The Court also rejected the government's contention that the UDV bore the burden of disproving the asserted compelling interests at the hearing on the preliminary injunction, citing another recent case which held that "respondents must be deemed likely to prevail unless the government has shown that respondents' proposed less restrictive alternatives are less effective than [enforcing the Act]." The Court stated that "Congress' express decision to legislate the compelling interest test indicates that RFRA challenges should be adjudicated in the same manner as constitutionally mandated applications of the test, including at the preliminary injunction stage." The government also challenged the district court's determination that it failed to articulate a compelling governmental interest to justify its burden on the UDV's religious practices by arguing that the Controlled Substances Act "precludes any consideration of individualized exceptions such as [those] sought by the UDV." The Supreme Court summarized the government's position, saying that "under the government's view, there is no need to assess the particulars of the UDV's use or weigh the impact of an exemption for that specific use, because the Controlled Substances Act serves a compelling purpose and simply admits of no exceptions." However, the Court rejected the government's assertion that Congress's classification of hoasca as a Schedule I substance "relieves the government of the obligation to shoulder its burden under RFRA." The Court noted that the Controlled Substances Act authorizes the Attorney General to "waive the requirement for registration of certain manufacturers, distributors, or dispensers if he finds it consistent with the public health and safety," and that an exception has been made for the religious use of peyote by the Native American Church and all members of every recognized Indian Tribe. The Court found that "[i]f such use is permitted ... for thousands of Native Americans practicing their faith, it is difficult to see how [the government] can preclude any consideration of a similar exception for the 130 or so American members of the UDV who want to practice theirs." The Court held that the peyote exemption not only undermined the government's contention that the Act admits no exceptions under RFRA, but that it also found that the government failed to provide evidence of how such an exemption has "undercut" the government's ability to enforce the law with respect to nonreligious uses. The Court rejected the government's reliance on other cases where the Court found that the government had a compelling interest in the uniform application of a particular program, finding that in this case the government's claim was not based on the administration of a statutory program, but rather on "slippery-slope concerns that could be invoked in response to an RFRA claim for an exception to a generally applicable law." In so doing, the Court stated that "RFRA operates by mandating consideration, under the compelling interest test, of exceptions to 'rule[s] of general applicability,'" and noted that it had recently reaffirmed "the feasibility of case-by-case consideration of religious exemptions to generally applicable rules." With respect to its obligation to comply with the United Nations Convention on Psychotropic Substances, the Court also rejected the government's contention that compliance with the treaty itself was enough to justify the burden on the UDV's religious exercises. In so doing, the Court stated that it did "not doubt the validity of [the government's] interests [in complying with the treaty], any more than [it] doubt[ed] the general interest in promoting public health and safety by enforcing the Controlled Substances Act, but under RFRA invocation of such general interests, standing alone, is not enough." The Court proceeded to affirm the judgment of the United State Court of Appeals for the Tenth Circuit and remanded the case for further proceedings. Presumably, the remand leaves open the possibility that the government could at some point establish a compelling interest that justifies the burden on the UDV. It should also be noted that the Court did not address the constitutionality of RFRA as it applies to the federal government, as this was not a question presented to it on appeal. The potential impact of the Court's decision is uncertain because the Court focused on the importance of a case-by-case approach with respect to religious exemptions from generally applicable rules. The Court's decision does not establish a broad precedent for religious exemptions from criminal statutes. It does, however, appear to establish a precedent with respect to the type of evidence that must be presented by the government to establish a compelling interest. The Court made it clear that the government could not establish a compelling interest in simply enforcing an existing statute; there must be some other justification for the burden on religious expression.

On February 21, 2006, the Supreme Court issued an opinion in Gonzales v. O Centro Espirita Beneficente Uniao do Vegetal (UDV), a case addressing the use of an hallucinogenic tea in the context of religious ceremonies conducted by a religious sect in New Mexico. In its decision, the Court determined that under the Religious Freedom Restoration Act (RFRA), the federal government could not prohibit the sect's use of the tea absent a compelling government interest in doing so, and that the federal government had failed to establish a compelling interest. This report provides an overview of RFRA and the O Centro Espirita case.

Check cashers are nonbank businesses that cash checks for a fee. Check cashing businesses may offer additional fee-based products and services including money orders, processing utility bill payments, pre-paid phone cards, and funds transfers. These enterprises often operate in neighborhoods not well served by banks. Check cashers provide access to financial services for individuals without accounts at conventional banks. To provide these services, a check cashing enterprise establishes a business relationship with a bank to clear checks, transfer funds, and open lines of credit for liquidity purposes. The Bank Secrecy Act regulations define check cashers as money services businesses (MSBs). Both banks and nonbank MSBs must have written anti-money laundering programs, file currency transaction reports (CRTs) and supicious activity reports (SARs), and maintain certain records. MSBs, including check cashers, must register with the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Treasury. Banks providing services to check cashers are expected to have systems to manage the risks associated with these accounts. The following developments created difficulties to obtaining and maintaining access to banking services. The Office of the Comptroller of Currency (OCC) a federal bank regulatory agency included check cashers and other MSBs in a list of inherently high-risk businesses in its Bank Secrecy Act/ Anti-Money Laundering Manual. The OCC has also stated that the risk profiles of individual businesses can vary widely based on the variety and range of financial services offered. FinCEN strengthened BSA enforcement after the enactment of the USA PATRIOT Act and with the increased focus on terrorism financing after 9/11. Banker's compliance costs were affected by the risks associated with a check cashing business. Substantial fines were levied by bank regulators on banking institutions for BSA non-compliance. The potential price of doing business proved to be prohibitive for a number of banks, resulting in discontinuance of services to check cashers. In April 2005, bank regulators issued interagency guidance in response to concerns over the loss of access to banking services by check cashers and other MSBs. Concern is twofold: (1) widespread termination of account relationships could result in the loss of access to financial services and products by the significant market segment currently served by check cashers and (2) if these businesses are consequently forced "underground" the potential loss of transparency could damage ongoing efforts to safeguard the U.S. financial system. The guidance addressed both the ability of check cashers and other MSBs to obtain services and the caution to be maintained by banks dealing with these businesses. The goal was to clarify the regulatory expectations for banking institutions providing services to domestic businesses. It is generally acknowledged that the trend of individual banks terminating account relationships with check cashers has continued. On June 21, 2006, the Subcommittee on Financial Institutions and Consumer Credit of the House Financial Services Committee held an oversight hearing to assess the impact of the BSA obligations on check cashers and other MSBs. The nonbank check cashing industry can trace its origins back to the 1930's when employers began paying workers by check as opposed to cash. Workers without traditional bank accounts used check cashers, where an account relationship is not required, to convert those paychecks into cash for a fee. Today's check cashing enterprise may offer additional fee-based products and services including money orders, processing utility bill payments, pre-paid phone cards and funds transfers. Money transfers may include foreign worker remittances (money sent back to the workers' home countries). Some also offer credit products such as payday loans, where customers are given cash for a postdated personal check for the amount of cash requested plus the check casher's fee. Check cashing services can be offered as an ancillary component of a business, such as a liquor stores that cashes payroll checks. Items cashed are primarily payroll checks, government checks, personal checks, cashier's checks, money orders, and traveler's checks. The typical value of a cashed item ranges from $300 to $600. Most fees range from 1% to 12% of the check's value. The main financial risk for the check casher is a returned check unpaid by the bank on which it was drawn. Fees vary by type of check. For example, the fee for a personal check is usually greater than for a government check. Many states require a license for check cashing enterprises and/or regulate their fee structures. Some states have additional restrictions for pay day lending. The check cashing industry has experienced a period of significant growth since the early 1990's. One estimate for 1990 indicated that the check cashing industry comprised approximately 4,250 businesses that cashed 128 million checks with a total face value of $38 billion. In 2002, an estimated 11,000 check cashing enterprises cashed approximately 180 million checks with a total face value of $55 billion. Customers are drawn to check cashers for a variety of reasons. Check cashers typically offer convenient hours of service that extend beyond the normal hours of operation found at mainstream banking institutions. The barriers involved with opening an account at a bank such as minimum account balances, specific identification requirements, and credit checks are not encountered. In addition, the check holder is not subject to the variety of fees and services charges typically associated with a bank account. A customer's funds are immediately available while banks may impose check clearing holds. Customers of check cashing businesses tend to be low and moderate income consumers. The so called "unbanked" consumers rely on alternative financial services offered by nonbanks. There are a significant number of unbanked families in the United States; they do not hold a checking or savings account at a federally insured financial institution. Studies vary, but it is generally estimated that about 10 million U.S. households do not own a bank account. The costs associated with maintaining accounts, dislike of banking institutions, and the convenience offered by alternative nonbank service providers are among the more frequently given reasons for their popularity. Conversely, it is estimated that 58% of the check cashing industry's clientele are bank account holders. In 1970, the Bank Secrecy Act was enacted to create a federal anti-money laundering program. In 2001, Title 111 of the USA PATRIOT ACT amended the BSA with provisions to strengthen the existing program and to counter terrorist financing. The Financial Crimes Enforcement Network, a bureau of the U.S. Treasury Department, administers and issues regulations pursuant to the BSA. Check cashing enterprises that meet the definition of a money service business are required to register with FinCEN. Banks providing services to check cashers are expected to have in place systems to manage the risks associated with these accounts. BSA reporting and record keeping requirements apply to both banks and MSBs. Both must establish anti-money laundering programs commensurate with the risks posed by their size, location and financial activities. Both are required to file currency transaction reports (CTRs) for cash transactions over $10,000 and to maintain a log on the sale of financial products such as money orders or travelers checks valued from $3,000 to $10,000. Information must also be maintained on funds transfer of $3,000 or more. Finally, MSBs are required to file suspicious activity reports (SARs). FinCEN has delegated the authority to examine check cashers for BSA compliance to the Internal Revenue Service (IRS). The intent of the interagency guidelines was to clarify the supervisory expectations of banks to remain in compliance with the requirements of the BSA while providing services to check cashers and other MSBs. The guidance was issued to assist banks in developing appropriate BSA risk assessments. Another goal was to help ensure check cashers and other MSBs have reasonable access to banking services. Concurrent with the 2005 guidance, an advisory was issued addressing the BSA obligations of check cashers and outlining the documentation an MSB may be expected to provide when establishing an account relationship at a bank. The advisory was issued as part of an ongoing campaign to inform MSBs about their BSA requirements. FinCEN has recognized that outreach to the MSB industry is essential; they found that many of the businesses, especially the smaller operations, are unfamiliar or unaware of their obligations. The 2005 interagency guidance directed banks opening and maintaining accounts for MSBs to apply the requirements of the BSA on a risk-assessed basis. Five minimum due diligence expectations are presented: (1) apply the bank's Customer Identification Program, (2) confirm FinCEN registration, (3) confirm compliance with state or local licensing requirements, (4) confirm agent status (many MSBs operate through a system of agents), and (5) conduct a basic Bank Secrecy Act/Anti-Money Laundering risk assessment to determine the level of risk associated with the potential account and whether further due diligence is necessary. The guidance outlines further due diligence criteria, beyond the minimum expectations, that may be called for by the risk profile of the individual money service business. Check cashers require specific banking services to operate. These financial services include depository accounts, check collection and clearing operations, funds transfer, and access to lines of credit for liquidity purposes. Banks generate fee income for financial services provided. An individual banking institution's experience with check cashers is often dependent on the proximity between the two. Some banks specialize in servicing check cashers. Consequently, the decision of an individual bank to discontinue services to check cashers could have a significant impact. For example, according to the Financial Services Center of America (FISCA), in New York 12 banks currently provide services to check cashers but 87% of the 640 licensed check cashers do business with only two of these banks. BSA compliance requirements and supervisory expectations are viewed as burdensome and have caused banks to re-evaluate the costs and benefits of opening and maintaining accounts for check cashers. Banking representatives testifying at the June 2006 oversight hearing stated that the level of BSA risk assessment and monitoring required of them by the regulatory agencies remains burdensome and costly despite the 2005 guidance. Of particular concern is determining the delineation between low and high risk profiles and the corresponding due diligence expectations. In addition, bankers suggested that regulators should not expect a bank's monitoring activity to extend beyond the check cashing business to the activity of the check casher's customers. They argue FinCEN should further clarify that banks are not expected to be de facto regulators of check cashers by instituting a system that more clearly defines the responsibility for oversight of the BSA obligations of check cashers and other MSBs. In March 2006, a FinCEN news release acknowledged the ongoing concerns of both the banking industry and money service businesses relating to BSA regulations despite the previous steps taken (including the April 2005 guidance) to address the issues. The difficulties involve how to minimize the resources and costs borne by financial institutions while ensuring the effective administration of the anti-terrorism financing and anti-money laundering programs. The news release announced an Advanced Notice of Proposed Rulemaking seeking input on what additional guidance or regulatory action would be appropriate to address the ongoing concerns about check casher's and other MSB's access to banking services. The news release emphasized the important role of MSBs and the negative effect on the health and safety of the U.S. financial system if these businesses are driven underground. Comments received by FinCEN are under review and potential next steps are being considered. On June 21, 2006, the Subcommittee on Financial Institutions and Consumer Credit of the House Committee on Financial Services held an oversight hearing on the Bank Secrecy Act's impact on money services businesses. There was general agreement that banks were re-evaluating their businesses strategies in light of BSA due diligence costs. There were reports of individual institutions concluding that opening and maintaining accounts for MSBs did not make economic sense. Regulatory and supervisory adjustments were discussed as a means of easing the burden on banks. Stronger state MSB regulatory oversight was encouraged. Joint industry/government training on BSA obligations for banks, bank examiners, and MSBs was suggested. In addition, FiSCA (the trade association, representing 6,000 check cashing operations and nonbank financial service centers), suggested the need for legislation that would remove state regulated check cashers from "high risk" categories. In its view, legislation could also limit administrative enforcement actions against banks that service check cashers in good faith.

A check cashing enterprise is a fee-based business that will cash a customer's check without requiring an account relationship. The U.S. check cashing industry underwent a significant expansion in the 1990s. Customers are attracted by the immediate access to funds, availability of service without a bank account, and convenience of extended hours of operation. In general, the industry is viewed as a provider of valuable financial services to an under served market segment. Check cashers are dependent on access to bank services to operate. Banks provide depository accounts, check collection and clearing operations, funds transfer, and access to lines of credit for liquidity purposes. Banks and check cashers are both subject to Bank Secrecy Act (BSA) regulations. The BSA is an anti-money laundering and anti-terrorism financing statute. Federal regulators have cautioned banks that nonbank money service businesses (an umbrella term that includes check cashing enterprises) can present heightened money laundering risks. Consequently, some banks have discontinued their business relations with check cashers. The discontinuance of services to check cashers brought about complaints to regulators and increased lobbying of Congress. Bank regulators have issued guidance to clarify BSA compliance expectations. Congress held hearings on the concerns of banks and check cashers. This report will be updated as events and legislation warrant.

Medicaid, authorized under Title XIX of the Social Security Act, is a federal-state program providing medical assistance for low-income individuals who are aged, blind, disabled, members of families with dependent children, or who have one of a few specified medical conditions. The Balanced Budget Act of 1997 established SCHIP under a new Title XXI of the Social Security Act. SCHIP builds on Medicaid by providing health insurance to uninsured children in families with income above applicable Medicaid income standards. Section 1115 of the Social Security Act provides the Secretary of Health and Human Services (HHS) with broad authority to conduct research and demonstration projects under several programs authorized by the Social Security Act including Medicaid and SCHIP. Section 1115 also authorizes the Secretary to waive certain statutory requirements for conducting these projects without congressional approval. For this reason, the research and demonstration projects are often referred to as Section 1115 "waiver" projects. Under Section 1115, the Secretary may waive Medicaid requirements contained in Section 1902 (including but not limited to what is known as, freedom of choice of provider, comparability of services, and state-wide access). The Secretary may also use the Section 1115 waiver authority to provide Federal financial participation (FFP) for costs that are not otherwise matchable under Section 1903 of the Social Security Act. For SCHIP, no specific sections or requirements are cited as "waiveable." Section 2107(e)(2)(A) of the Social Security Act states that Section 1115 of the act, pertaining to research and demonstration waivers, applies to SCHIP. States must submit proposals outlining terms and conditions for proposed waivers to CMS for approval before implementing these programs. In recent years, there has been increased interest among states and the federal government in the Section 1115 waiver authority as a means to restructure coverage, control costs, and increase state flexibility. Under current law, states may obtain waivers that allow them to provide services to individuals not traditionally eligible for Medicaid (or SCHIP), cover non-Medicaid (or SCHIP) services, limit benefit packages for certain groups, among other purposes. Whether large or small reforms, Section 1115 waiver programs have resulted in significant changes for Medicaid and SCHIP recipients nationwide, and may serve as a precedent for federal and state officials who wish to make statutory changes to these healthcare safety net programs. While Section 1115 is explicit about provisions in Medicaid law that may be waived in conducting demonstration projects, a number of other provisions in Medicaid law and regulations specify limitations on how a state may operate a waiver program. For example, one provision restricts states from establishing waivers that fail to provide all mandatory services to the mandatory poverty-related groups of pregnant women and children; another provision specifies restrictions on cost-sharing under waivers. Other features of the Section 1115 waiver authority include: Federal Reimbursement for Section 1115 Demonstrations . Approved Section 1115 waivers are deemed to be part of a state's Medicaid (or SCHIP) state plan for purposes of federal reimbursement. Project costs associated with waiver programs are subject to that state's FMAP (or enhanced-FMAP) . Financing and Budget Neutrality . Unlike regular Medicaid, CMS waiver guidance specifies that waiver costs are budget neutral to the federal government over the life of the waiver program. To meet the budget neutrality test, estimated spending under the waiver cannot exceed the estimated cost of the state's existing Medicaid program under current law program requirements. For example, costs associated with an expanded population (e.g., those not otherwise eligible under Medicaid), must be offset by reductions elsewhere within the Medicaid program. Several methods are used by states to generate cost savings for the waiver component: (1) limiting benefit packages for certain eligibility groups; (2) providing targeted services to certain individuals so as to divert them from full Medicaid coverage; and (3) using enrollment caps and cost-sharing to reduce the amounts states must pay. Financing and Allotment Neutrality . Under the SCHIP program, a different budget neutrality standard applies. States must meet an "allotment neutrality test" where combined federal expenditures for the state's regular SCHIP program and for the state's SCHIP demonstration program are capped at the state's individual SCHIP allotment (i.e., original allotments and funds made available through the redistribution of unspent SCHIP funds). This policy limits federal spending to the capped allotment levels. Application and Approval Process. There is no standardized process to apply for a Section 1115 demonstration, but CMS has issued program guidance that impacts the approval process. States often work collaboratively with CMS to develop their proposals. Project proposals are subject to approval by CMS, the Office of Management and Budget (OMB), and the Department of Health and Human Services (DHHS), and may be subject to additional requirements such as site visits before the program may be implemented under the agreed upon terms and conditions. Duration. Waiver projects are generally approved for a five-year period, however, states may seek up to a three-year extension for their existing waiver program under the same special terms and conditions (STC), and an additional extension(s) under revised STC for the continuation of a waiver project operating under an initial three-year extension. Relationship of Medicaid/SCHIP Demonstration Waivers to Other Statutes . Section 1115 waiver projects may interact with other program rules outside of the Social Security Act; for example, employer-sponsored health insurance as described by the Employee Retirement Income Security Act (ERISA), or alien eligibility as contained in immigration law. In cases like these, the Secretary does not have the authority to waive provisions in these other statutes. Program Guidance. The Secretary can develop policies that influence the content of demonstration projects and prescribe approval criteria in three ways: (1) by promulgating program rules and regulations; (2) through the publication of program guidance (e.g., waivers must be budget neutral); and (3) waiver policy may also be implicitly shaped by the programs that have been approved (e.g., CMS approval of benefit specific waivers). Legislative action may be required if Congress chooses to further shape the Secretary's authority over the content of the demonstration programs, dictate specific Section 1115 waiver approval criteria, or otherwise limit the Secretary's waiver authority. As of July 1 2008, there were 94 operational Medicaid and SCHIP Section 1115 waivers in 43 states and the District of Columbia. In FY2006 (the most recent data available), Section 1115 waiver federal expenditures (for Medicaid and SCHIP) totaled approximately $42.4 billion. Section 1115 waiver programs represented approximately 24% of all federal Medicaid spending in the 50 states and the District of Columbia for FY2006 (19% for SCHIP), and provided coverage to approximately 11.5 million enrollees. Of the 11.5 million total Medicaid and SCHIP waiver enrollees, 2.5 million were only eligible for a targeted benefit package such as family planning benefits. There are several types of operational waiver programs including: Comprehensive demonstrations. These demonstrations provide a broad range of services that are generally offered statewide. Many of the comprehensive waivers operate under combined title XIX and title XXI authority and are financed with federal Medicaid and SCHIP matching funds. Several also include a family planning and/or Health Insurance Flexibility and Accountability (HIFA) component (see below). In FY2008, there were 32 operational comprehensive state reform waivers in 26 states. FY2006 state-reported enrollment estimates for these waivers totaled approximately 8.1 million, at a federal cost of approximately $38.4 billion. The SCHIP-financed portion of these waivers extended coverage to approximately 475,376 enrollees at a federal cost of $330 million. FY2006 enrollee estimates for the limited benefits offered under a FP component totaled approximately 104,990. Family planning demonstrations (FP) . In FY2008, there were 22 states with stand-alone FP waivers to provide a limited benefit package including family planning services and supplies for certain individuals of childbearing age. FY2006 enrollment estimates for stand-alone FP waivers totaled 2.4 million at a federal cost of approximately $1.4 billion. Just over 1,000 of FY2006 enrollees were SCHIP-eligible with care financed out of the SCHIP allotments. SCHIP and HIFA Waivers . Of the 20 states with SCHIP waivers in FY2008, 14 have SCHIP waivers that were granted under the HIFA initiative. HIFA demonstrations are designed to encourage states to extend Medicaid and SCHIP to the uninsured, with an emphasis on approaches that maximize private health insurance coverage and target populations with incomes below 200% of the federal poverty level (FPL). Under HIFA, states were encouraged to finance program expansions using unspent SCHIP funds to, for example, extend coverage to one or more categories of adults with children (typically parents of Medicaid/SCHIP children, caretaker relatives, or legal guardians), and/or pregnant women. Four states (i.e., Arizona, Michigan, New Mexico, and Oregon) have approval to cover childless adults under their HIFA waivers. The Deficit Reduction Act of 2005 prohibits new waivers that would use SCHIP funds to provide coverage to nonpregnant, childless adults. Recently the Administration has not renewed existing waivers that permitted coverage of adults through SCHIP. In addition to expanding coverage to new populations under SCHIP, some states use the SCHIP Section 1115 authority for other purposes including modifying cost-sharing rules (e.g., New Mexico), and requiring periods of no insurance prior to SCHIP enrollment (e.g., Alaska and New Mexico). As of FY2006, approximately 925,196 enrollees accessed services under SCHIP and HIFA demonstrations at a federal cost of $675 million. Specialty services and population demonstrations . These demonstrations generally include programs that provide cash to enrollees so that they may directly arrange and purchase services that best meet their needs. In addition, they include waivers to provide pharmacy benefits to persons with specific conditions, such as HIV/AIDS. As of FY2008, there were 20 such operational programs in 15 states and the District of Columbia. In FY2006, these demonstrations covered approximately 37,473 individuals at a federal cost of approximately $441 million. Federal costs for Pharmacy-only demonstrations totaled $1.5 billion in FY2006. Katrina/Multi - state Demonstrations. In response to the Hurricane Katrina disaster, CMS allowed states to provide temporary eligibility for specified Katrina evacuees so that such individuals could obtain state plan services in a host state (i.e., a state that has been granted an emergency Section 1115 waiver). Between September 2005 and March 2006 CMS approved 32 Katrina waivers that extended coverage to an estimated 118,602 individuals at a federal cost of $1.63 billion.

Section 1115 of the Social Security Act provides the Secretary of Health and Human Services (HHS) with broad authority to waive certain statutory requirements for states to conduct research and demonstration projects that further the goals of Titles XIX (Medicaid) and/or XXI (the State Children's Health Insurance Program; SCHIP). States use the Section 1115 waiver authority to cover non-Medicaid and SCHIP services, limit benefit packages, cap program enrollment, among other purposes. As of July 1 2008, there were 94 operational Medicaid and SCHIP Section 1115 waiver programs in 43 states and the District of Columbia. In FY2006 (the most recent data available), Section 1115 waiver federal expenditures (for Medicaid and SCHIP) totaled approximately $42.4 billion. Section 1115 waiver programs represented approximately 24% of all federal Medicaid spending in the 50 states and the District of Columbia for FY2006 (19% for SCHIP), and provided coverage to approximately 11.5 million enrollees—2.5 million of whom were eligible only for a targeted benefit package such as family planning or pharmacy benefits. FY2006 waiver expenditure and enrollment estimates from the Centers for Medicare and Medicaid Services (CMS) based on state-reported data, and are subject to change. Between FY2001 (the earliest year for which CRS has access to Section 1115 expenditure estimates) and FY2005, federal Medicaid waiver expenditures as a percentage of total Medicaid spending were steady at approximately12-14%. In FY2006, there was a substantial increase in federal waiver spending as a percentage of total Medicaid spending (i.e., almost 60% increase over the FY2005 totals). While there are several plausible explanations for this increase (e.g., ramp up of new and renegotiated waivers, prior period adjustments, etc.) because waiver financing arrangements are negotiated over a 5-year budget window it is hard to determine if the jump in federal expenditures represents a step increase in overall federal waiver spending, or a one-time increase that will be mitigated over the budget authority window. Analysis of future waiver expenditure trends will help to clarify this question. Estimates do not include state experience under the 5 month temporary Katrina waivers (described below).This report provides background information on the waiver authority, and will be updated when new data are available.

Enactment of the Unfunded Mandates Reform Act of 1995 (UMRA) culminated years of effort by nonfederal government officials and their advocates to control, if not eliminate, the federal imposition of unfunded mandates. Supporters contend that the statute is needed to forestall federal legislation and regulations that impose questionable or unnecessary burdens and have resulted in high costs and inefficiencies. Opponents argue that mandates may be necessary to achieve results in areas in which voluntary action may be insufficient or state actions have not achieved intended goals. Since the mid-1980s, Congress debated legislation to slow or prohibit the enactment of unfunded federal mandates. The inclusion of the issue in the Contract with America, the blueprint of legislative action developed by the House Republican leadership when it gained the majority, practically guaranteed that action would be taken. UMRA was signed into law early in the 104 th Congress, on March 22, 1995. Under UMRA, federal mandates include provisions of law or regulation that impose enforceable duties, including taxes. They also include provisions that reduce or eliminate federal financial assistance available for carrying out an existing duty. UMRA distinguishes between "intergovernmental mandates," imposed on state, local, or tribal governments, and "private sector mandates." Intergovernmental mandates include legislation or regulations that would (1) reduce certain federal services to state, local, and tribal governments (such as border control or reimbursement for services to illegal aliens); and (2) tighten conditions of assistance or reduce federal funding for existing intergovernmental assistance programs with entitlement authority of $500 million or more. Exclusions and exemptions outside the reach of the statute are discussed later in this report. Under UMRA, an intergovernmental mandate is considered unfunded unless the legislation authorizing the mandate meets its costs by either (1) providing new budget authority (direct spending authority or entitlement authority) or (2) authorizing appropriations. If appropriations are authorized, the mandate is considered unfunded unless the legislation ensures that in any fiscal year (1) the actual costs of the mandate will not exceed the appropriations actually provided; (2) the terms of the mandate will be revised so that it can be carried out with the funds appropriated; (3) the mandate will be abolished; or (4) Congress will enact new legislation to continue the mandate as an unfunded mandate. The act consists of five prefatory sections and four titles. The prefatory sections address matters such as the purpose, short title, and exclusions from coverage of the act. Title I amends the Congressional Budget and Impoundment Control Act, as amended, to permit Congress to (1) identify legislation proposing mandates, and (2) decline to consider legislation proposing unfunded intergovernmental mandates. Title I also sets forth thresholds for action, authorizations, and definitions. Title II requires that federal agencies assess the financial impact of proposed rules on nonfederal entities, determine whether federal resources exist to pay those costs, solicit and consider input from affected entities, and generally select the least costly or burdensome regulatory option. Title III called for a review of federal mandates to be completed within 18 months of enactment. This statutory requirement was not completed. UMRA assigned the study to the Advisory Commission on Intergovernmental Relations (ACIR), which no longer exists. The ACIR completed a preliminary report in January, 1996, but the final report was not released. Title IV authorizes judicial review of federal agency compliance with Title II provisions. The remainder of this report summarizes the requirements set forth in Titles I, II, and IV of the act. Referred to as "Legislative Accountability and Reform," Title I establishes requirements for committees and the Congressional Budget Office (CBO) to study and report on the magnitude and impact of mandates in proposed legislation. Title I also creates point-of-order procedures through which these requirements can be enforced and the consideration of measures containing unfunded intergovernmental mandates can be blocked. Under UMRA, congressional committees have the initial responsibility to identify federal mandates in measures under consideration. Committees may have CBO study whether proposed legislation could have a significant budgetary impact on nonfederal governments, or a financial or employment impact on the private sector. Also, committee chairs and ranking minority members may have CBO study any legislation containing a federal mandate. When an authorizing committee orders reported a public bill or joint resolution containing a federal mandate, it must provide the measure to CBO. CBO must report to the committee an estimate of mandate costs. The office must prepare full quantitative estimates if costs are estimated to exceed $59 million (for intergovernmental mandates) or $117 million (for private sector mandates) in any of the first five fiscal years the legislation would be in effect. Below these thresholds, CBO must prepare brief statements of cost estimates. For each reported measure with costs over the thresholds, CBO is to submit to the committee an estimate of the direct costs of federal mandates contained in it, or in any necessary implementing regulations; and the amount of new or existing federal funding the legislation authorizes to pay these costs. If reported legislation authorizes appropriations to meet the estimated costs of an intergovernmental mandate, the CBO report must include a statement on the new budget authority needed, for up to 10 years, to meet these costs. For a measure that reauthorizes or amends an existing statute, the direct costs of any mandate it contains are to be measured by the projected increase over those costs required by existing law. The calculation of increased costs must include any projected decrease in existing federal aid that provides assistance to nonfederal entities. The committee is to include the CBO estimate in its report or publish it in the Congressional Record . The committee's report on the measure must also identify the direct costs to the entities that must carry out the mandate; assess likely costs and benefits; describe how the mandate affects the "competitive balance" between the public and private sectors; and state the extent to which the legislation would preempt state, local, or tribal law, and explain the effect of any preemption. These requirements apply to all proposed mandates, both intergovernmental and private sector. For intergovernmental mandates alone, the committee is to describe in its report the extent to which the legislation authorizes federal funding for the direct costs, and details on whether and how funding is to be provided. UMRA establishes that when any measure is taken up for consideration in either house, a point of order may be raised that the measure contains unfunded intergovernmental mandates exceeding the $59 million threshold. This point of order applies to the measure as reported, including, for example, a committee amendment in the nature of a substitute. The point of order may also be raised if CBO reported that no reasonable estimate of the cost of intergovernmental mandates was feasible. A point of order also may be raised against consideration of a measure reported from committee if the committee has not published a CBO estimate of mandate costs. This point of order applies to both intergovernmental and private sector mandates. In the Senate, either point of order may be waived by majority vote. Otherwise, if the chair sustains the point of order, the measure may not be considered. In ruling on these points of order, the chair is to consult with the Committee on Governmental Affairs on whether the measure contains intergovernmental mandates. Also, the unfunded costs of the mandate are to be determined based on estimates by the Committee on the Budget (which may draw for this purpose on the CBO estimate). For the House, UMRA provides that if either point of order is raised, the chair does not rule on it. Instead, the House votes on whether to consider the measure despite the point of order. To prevent dilatory use of the point of order, the chair need not put the question of consideration to a vote unless the Member making the point of order meets the "threshold burden" of identifying specific language that is claimed to contain the unfunded mandate. Also, if several points of order could be raised against the same measure, House practices under UMRA afford means for all to be consolidated in a single vote on consideration. Finally, if the Committee on Rules proposes a special rule for considering the measure that waives the point of order, UMRA subjects the special rule itself to a point of order, which is disposed of by the same mechanism. These procedures are intended to insure that the House, like the Senate, will always have an opportunity to determine, by vote, whether to consider a measure that may contain an unfunded mandate. Also, if the House votes to consider a measure in spite of the point of order, UMRA protects the ability of Members to offer amendments in the Committee of the Whole to strike out unfunded intergovernmental mandates, unless the special rule specifically prohibits such amendments. A point of order under the UMRA mechanism may be raised not only against initial consideration of a bill or resolution, but also against consideration of an amendment, conference report, or motion (e.g., a motion to recommit with instructions or a motion to concur in an amendment of the other house with an amendment) that would cause the unfunded costs of intergovernmental mandates in a measure to exceed the specified threshold. UMRA does not require amendments or motions to be accompanied by CBO mandate cost estimates, but a Senator may request CBO to estimate the costs of mandates in an amendment he or she prepares. If an amended bill or resolution or a conference report contains a new mandate or other new increases in mandate costs, the conferees are to request a supplemental estimate, which CBO is to attempt to provide. UMRA requires no publication of these supplemental estimates. The UMRA points of order are not applicable against consideration of appropriations bills. However, if an appropriation bill contains legislative provisions that would create unfunded intergovernmental mandates in excess of the threshold, the UMRA point of order may be raised against the provisions themselves. In the Senate, if this point of order is sustained, the provisions are stricken from the bill. Legislation pertinent to the following subject matters remains exempt from the UMRA point-of-order procedures: individual constitutional rights, discrimination prohibitions, auditing compliance, emergency assistance requested by nonfederal government officials, national security or treaty obligations, emergencies as designated by the President and the Congress, and Social Security. The provisions of Title I pertinent to federal agencies (for example, the requirement that agencies determine whether sufficient appropriations exist to provide for proposed costs) do not apply to federal regulatory agencies. Also, provisions establishing conditions of federal assistance or duties stemming from participation in voluntary federal programs are not mandates. Title II requires that federal agencies prepare written statements that identify costs and benefits of a federal mandate to be imposed through the rulemaking process. The requirement applies to regulatory actions determined to result in costs of $117 million or more in any one year (2003 figure, as adjusted for inflation). The written assessments to be prepared by federal agencies must identify the law authorizing the rule, anticipated costs and benefits, the share of costs to be borne by the federal government, and the disproportionate costs on individual regions or components of the private sector. Assessments must also include estimates of the effect on the national economy, descriptions of consultations with nonfederal government officials, and a summary of the evaluation of comments and concerns obtained throughout the promulgation process. Impacts of "any regulatory requirements" on small governments must be identified; notice must be given to those governments; and technical assistance must be provided. Also, UMRA requires that federal agencies consider "a reasonable number" of policy options and select the most cost-effective or least burdensome alternative. The requirements in Title II pertaining to the preparation of a mandate assessment statement and notification of impact on small governments remain subject to judicial review. A federal court may compel a federal agency to comply with these requirements, but such a court order cannot be used to stay or invalidate the rule.

This summary of the Unfunded Mandates Reform Act (UMRA) of 1995 will assist Members of Congress and staff seeking succinct information on the statute. The term "unfunded mandates" generally refers to requirements that a unit of government imposes without providing funds to pay for costs of compliance. UMRA establishes mechanisms to limit federal imposition of unfunded mandates on other levels of government (intergovernmental mandates) and on the private sector. The act establishes points of order against proposed legislation containing an unfunded intergovernmental mandate, requires executive agencies to seek comment on regulations that would constitute a mandate, and establishes a means for judicial enforcement. This report will be updated if the act is amended.

Established in 1971 at the request of the SEC, the Nasdaq stock market is an all-electronic trading facility, which, unlike traditional exchanges like the New York Stock Exchange (NYSE) and the American Stock Exchange (AMEX), has no trading floors and facilitates the trading of over-the-counter (OTC) stocks through a network of market makers connected by telephone and computer. Nasdaq stock market was originally a wholly-owned for-profit subsidiary of the nonprofit NASD, which also served as its direct regulator or self-regulatory organization (SRO). In the mid-1990s, NASD's integrity as a self regulator was called into question when Nasdaq market makers were accused of manipulating stock prices. After a federal investigation, the NASD Regulation (NASDR) was established in 1996 as an independent subsidiary of the NASD. The main purpose was to separate the regulation of the broker/dealer profession from the operation of the Nasdaq. The NASDR became the primary regulator of broker-dealers and of the Nasdaq. All broker-dealers who are registered with the SEC, except those doing business exclusively on a securities exchange, are required to join the NASD. The NASDR's regulatory budget is derived solely from fees and fines imposed on NASD member firms. When it began, Nasdaq was regarded as a technological innovator because it did not rely on a physical trading floor. But over the last decade, both Nasdaq and traditional exchanges have faced growing competition from two principal sources: First, global stock markets that compete with U.S. markets for multinational corporate listings have grown dramatically. Second, continuous technological change has led to automated, computer-matching, trading platforms called electronic communication networks (ECNs). Indeed, Nasdaq has developed its own ECN, the SuperMontage and has acquired another one, Brut. To help themselves remain competitive, the world's major stock markets are reexamining their governance and capital structures with an eye toward changes that would enable them to react more deftly to the rapidly changing securities marketplace. Conversion from privately-held (mutual) status to shareholder-owned status known as demutualization, has become an increasingly attractive strategic response to the changing market dynamics. Many international and domestic stock exchanges have demutualized over the last decade or so, including the London, Tokyo, Philadelphia, and the New York Stock Exchange (in early 2006 after merging with Archipelago, the electronic communication trading network). Key reasons for demutulization have included that (1) it enables exchanges to more immediately raise capital and provide better regular access to capital markets; (2) it makes exchanges better able to align their interests with those of their key participants; and (3) it provides exchanges with greater flexibility and speed in adapting to changing market conditions. In the summer of 1999, the Nasdaq announced its intent to demutualize. This change raised a number of policy concerns that largely involved demutualized stock markets' ability to effectively discharge their SRO duties. Among the key questions raised by the prospect of demutulization were (1) Is there a cause for concern when a for-profit, shareholder-owned SRO regulates entities like broker-dealers who in turn have ownership stakes in competitive rivals such as electronic communication networks? and (2) Would the altered economics of being a for-profit, shareholder-owned exchange affect an exchange's ability to effectively regulate itself? After announcing its interest in pursuing demutualization, the NYSE cited other pressing concerns and put the process on hold. In April 2000, however, the NASD membership approved spinning off the for-profit Nasdaq from the non-profit NASD and converting it into a shareholder-owned market. The process was initially envisioned to have three broad stages: (1) issuing privately placed stock; (2) converting to technical exchange status; and (3) issuing public stock. The private placement took place in two sub-stages. In the initial sub-stage, the private placement, which was completed in June 2000, the NASD sold shares and issued warrants on shares of Nasdaq that it owned, and Nasdaq also issued and sold additional shares. The NASD's ownership interest in Nasdaq was reduced from 100% to 60%. The second sub-phase of the private placement was completed on January 18, 2001, with NASD's ownership interest then falling to 40% or about 77 million Nasdaq shares. The NASD, however retained 51% of the actual voting interest in Nasdaq. On February 21, 2002, Nasdaq acquired 13.5 million shares held by the NASD. On March 8, 2001, Nasdaq acquired 20.3 million shares from the NASD, leaving 43.2 million shares still owned by the NASD in the form of underlying warrants that had been issued during Nasdaq's private placements. Concurrently, a new series of preferred voting stock was issued to the NASD, allowing it to continue to have majority voting interest in Nasdaq. The second stage, conversion to exchange status, was a requirement for the third stage—sale of Nasdaq shares to the public. Although from a practical standpoint it has little significance, Nasdaq currently is exempt from the definition of an "exchange" under Rule 3a1-1 of the Securities and Exchange Act of 1934 because it is operated by the NASD. Before the NASD could relinquish control of it, Nasdaq was required to register as a national securities exchange. With approval of Nasdaq's exchange application, the preferred shares that provide the NASD with its majority vote interest over Nasdaq will expire and it will no longer have effective control over Nasdaq. The exchange's ultimate goal has been to conduct an initial public offering (IPO). On March 15, 2001, Nasdaq submitted an initial application for exchange status to the SEC, an application that the agency published for comment on June 14, 2001. It later made several amendments to the application in late 2001 and early 2002. After the initial application, the foremost regulatory concern for the SEC and a number of securities market participants was that, as written, the application would have continued to allow Nasdaq to operate without a trade execution protocol known as intra-market price and time priority, which is required of exchanges. This protocol is described below. Nasdaq processes limit orders, orders to buy or sell a stock when it hits a specified price. The NYSE centrally posts limit orders, which permits better-priced orders to receive priority execution there or on the various other interlinked market centers that trade NYSE-listed stocks. This is known as price and time priority and all exchanges abide by it. (Both the Nasdaq and the NYSE are markets in which brokers are required to exercise their duty of best execution when they route their customer's orders. The concept is inexplicit but is often interpreted to means that an order should be sent to the market center providing the best prevailing price.) But a significant fraction of Nasdaq market makers match buyer and seller orders from their own order books. Known as internalization, this can result in well priced limit orders outside of a market maker's book being ignored. Nasdaq officials have argued that their market permits competing dealers to add liquidity to the markets by interacting with their own order flow but SEC officials have concerns about the formal absence of price priority. This was a major sticking point in the agency's delay in approving the exchange application, concerns that Nasdaq attempted to address through subsequent amendments to its exchange application. On January 13, 2006, the SEC approved Nasdaq's application to become a registered national securities exchange. As a registered exchange, Nasdaq will become a self-regulatory organization (SRO) with ultimate responsibilty for its own and its members compliance with the federal securities laws. Several years ago, Nasdaq entered into a Regulatory Services Agreement with the NASD to perform certain key regulatory functions for it, an arrangement that should continue. Nasdaq is now officially a registered an exchange, but the SEC will not permit Nasdaq to begin operations as an exchange and to fully relinquish its independence from ongoing control by the NASD until various conditions, including the following key ones, are satisfied: Nasdaq must join the various national market system plans and the Intermarket Surveillance Group; The NASD must determine that its control of Nasdaq through its Preferred Class D share is no longer necessary because NASD can fulfill through other means its obligations with respect to non-Nasdaq exchange-listed securities under the Exchange Act; The SEC must declare certain regulatory plans to be filed by Nasdaq to be effective; and Nasdaq must file, and the Commission must approve, an agreement pursuant to Section 17d-2 of the Securities Exchange Act of 1934 that allocates to NASD regulatory responsibility with respect to certain activities of common members. Nasdaq's exchange application limits the exchange to transactions in the Nasdaq Market Center, previously known as SuperMontage and Brut, which will adhere to rules on intramarket priorities. However, orders that are internalized by NASD broker dealers that may not adhere to intra-market priority rules would be reported through the new Trade Reporting Facility (TRF), which must go through a separate regulatory review process and which will be administered by the NASD. Nasdaq will receive revenues from TRF trades (a contentious point for a number of its rivals).

Traditionally, the Nasdaq stock market was a for-profit, but wholly-owned subsidiary of the nonprofit National Association of Securities Dealers, Inc. (NASD), the largest self-regulatory organization (SRO) for the securities industry. In 2000, in a strategic response to an increasingly competitive securities trading market, the NASD membership approved spinning off the for-profit NASD-owned Nasdaq and converting it into a for-profit shareholder-owned market that later planned to issue publicly traded stock. For Nasdaq, this process has involved three basic stages: (1) issuing privately placed stock; (2) converting to technical exchange status; and (3) issuing publicly-held stock. Stage one, the private placement stage has been completed. In March 2001, Nasdaq submitted an application for exchange status to the Securities and Exchange Commission (SEC), an application that has been amended several times to address certain criticisms. Obtaining exchange status is necessary for Nasdaq to proceed to stage three, the issuance of publicly held stock. Realization of that stage became much closer on January 13, 2006, when after more than a half decade, the SEC approved Nasdaq's application to become a registered national securities exchange.