Appropriations for FY2005: Energy and Water Development
Released: 2004-12-10T00:00:00

Most Recent Developments

The Bush Administration's FY2005 budget request, released February 2, 2004, budgetedEnergy and Water Development Programs at $27.94 billion, compared to $27.26 billion appropriatedfor the same programs for FY2004. On June 16 the House Appropriations Committee reported itsbill with $27.99 billion, and the House passed it June 25. The House and Senate both approved aconference report ( H.Rept. 108-792 ) on H.R. 4818 on November 20, containingFY2005 appropriations for previously unpassed bills, including Energy and Water Development. H.R. 4818 was forwarded to the President December 6 and signed December 8 ( P.L.108-447 ).

Status

Table 1. Status of Energy and Water DevelopmentAppropriations, FY2005

*Held at desk in Senate until December 6, when the House approved H.Con.Res. 528 .

Overview

The Energy and Water Development bill includes funding for civil worksprojects of the U.S. Army Corps of Engineers (Corps), the Department of theInterior's Bureau of Reclamation (BOR), most of the Department of Energy (DOE),and a number of independent agencies, including the Nuclear RegulatoryCommission (NRC) and the Appalachian Regional Commission (ARC). The BushAdministration's request was $27.938 billion for these programs for FY2005,compared with $27.253 billion appropriated for FY2004. The House bill( H.R. 4614 ) reported by the Appropriations Committee, and passed bythe House June 25, contained funding at $27.988 billion. The omnibus ConsolidatedAppropriations bill ( H.R. 4818 , P.L. 108-447 ) appropriates $28.488billion, less an across-the-board rescission of 0.80% (Division J, section 122, asamended by H.Con.Res 528). Throughout this report, figures cited for funding in theomnibus bill do not reflect this 0.80% reduction.

Table 2 includes budget totals for energy and water development appropriations enacted for FY1998 to FY2004 and the Administration's request for FY2005.

Table 2. Energy and Water Development Appropriations, FY1998 to FY2005 (budget authority in billions of current dollars) a

a These figures represent current dollars, exclude permanent budget authorities, andreflect rescissions.

Table 3 lists totals for each of the four titles. The table also lists several "scorekeeping" adjustments of accounts within Titles II and III that affect the totalamount appropriated in the bill but are not included in the totals of the individualtitles.

Table 3. Energy and Water Development Appropriations Summary of Funding by Title ($ billions)

Source: H.Rept. 108-792 .

Note: a. Does not include the modified rescission amount of .80% in H.Con.Res. 528 .

For the Corps in FY2005, the Administration requested $4.12 billion, a decrease of $460 million from the enacted appropriation for FY2004. The Administration'srequest focused funding on construction projects that could be completed in FY2005and eight projects considered priorities by the Administration, including the FloridaEverglades. The omnibus H.R. 4818 ( P.L. 108-447 ) increased thefunding to $4.71 billion before the rescission.

The Administration asked for $970 million for FY2005 for the Department of the Interior programs included in the Energy and Water Development bill -- theBureau of Reclamation and the Central Utah Project. This would be a decrease of$11 million from the FY2004 funding level. The House bill ( H.R. 4614 )would have appropriated $1.021 billion. The omnibus bill appropriated $1.020billion, less the rescission.

The FY2005 request for DOE programs in the bill was $23.148 billion, about $1.18 billion more than the previous year. The major activities in the DOE budget areenergy research and development, general science, environmental cleanup, andnuclear weapons programs. (Funding of DOE's programs for fossil fuels, energyefficiency, and energy statistics is included in the Interior and Related Agenciesappropriations bill. The FY2005 net request for these programs was $1.7 billion.) The House bill ( H.R. 4614 ) would have appropriated $22.478 billion. The omnibus bill appropriated $23.003 billion, less the rescission.

The FY2005 request for funding the independent agencies in Title IV of the bill was $232 million, compared with $228 million in FY2004. The House bill( H.R. 4614 ) would have appropriated $193 million for these programs. The omnibus bill figure is $292 million.

Tables 4 through 11 provide budget details for Title I (Corps of Engineers), Title II (Department of the Interior), Title III (Department of Energy), and Title IV(independent agencies) for FY2004-FY2005.

Title I: Corps of Engineers

The President's request for FY2005 for the civil works program of the U.S.Army Corps of Engineers was $4.12 billion, a decrease of $460 million from theenacted appropriation for FY2004.

Table 4. Energy and Water Development Appropriations Title I: Corps of Engineers ($ millions)

Source: Administration budget request for FY2005, H.Rept. 108-554 , and H.Rept. 108-792 . Budget justifications for FY2005 from the Corps of Engineers.

Notes:

a. Includes an across-the-board rescission of .59% included in the FY2004Consolidated Appropriations Act, P.L. 108-199 , enacted on January 23, 2004.

b. This figure reflects amounts provided by the House Appropriations Committee;the Committee showed $35.9 million added by P.L. 108-199 . Other sourcesindicate that the supplemental appropriation was less and that the totalconstruction appropriation was $1731.3.

c. This amount includes the Administration's proposed cancellation of $100 million($94 million in construction, $5 million in Mississippi River flood control, $1million in flood control and coastal emergencies) in unobligated FY2004balances for work on 41 projects that are "inconsistent with current policy."

d. "Formerly Utilized Sites Remedial Action Program."

e. The conference committee for FY2004 appropriations removed all funding for theFlood Control and Coastal Emergencies account because the account wasreplenished with $60 million through the Legislative Branch Appropriations Actfor FY2004, P.L. 108-83 .

f. Does not include the modified rescission amount of .80% in H.Con.Res. 528 , which would produce a total of $4,667.9 million.

The President's FY2005 budget request was similar in many ways to the President's FY2004 request. Again for FY2005, the President's request fundedconstruction projects that could be completed in FY2005 and projects considered bythe Administration to be priorities. The eight priority projects included the NewYork and New Jersey Harbor Deepening project, restoration projects in the FloridaEverglades and the side channels of the Upper Mississippi River system, and projectsto meet environmental requirements in the Columbia River Basin and the MissouriRiver basin. The President's budget also funded three new projects that weredetermined to have high economic and environmental return. Outside of these threeprojects, there were no other new construction starts, because of the Administration'sconcern with the funding needed to complete projects budgeted for construction. Inkeeping with the Administration's approach to reducing the agency's constructionbacklog, the President's budget limited funding for planning to five new projects. The request also focused the operation and maintenance funds for the inlandwaterways and harbors on projects supporting a high volume of traffic.

The Corps announced in its budget briefing on February 2, 2004, that it did not budget for the continued renourishment of shoreline storm damage reductionprojects, indicating that it considered these costs as maintenance expenses to beborne by the non-federal project sponsors. This represented a change from theCorps' past involvement with renourishment, often at a 50% federal cost share. Thebudget also generally deemphasized shallow draft harbors and waterways with lowcommercial use.

The President requested no funds for studies and "environmental infrastructure" projects in the following non-traditional mission areas: wastewater treatment,irrigation water supply, and municipal and industrial water supply treatment anddistribution. By not seeking funding for these activities, the Administrationreinforced its interest in focusing federal funding on navigation, flood control, stormdamage reduction, and ecosystem restoration projects.

H.R. 4818 ( P.L. 108-447 ) increases the Corps' appropriations over FY2004 and above the President's FY2005 request; the exact increase depends onthe size of the rescission. H.R. 4818 ( P.L. 108-447 ) funds someenvironmental infrastructure projects and funds some beach renourishment activities.Furthermore, the bill states that the Corps shall not implement any changes toexisting shoreline protection policies that have not been specifically authorized byCongress. The bill does not fund the new study or construction starts requested bythe President. It does fund some controversial construction projects, including theDallas Floodway Extension and Yazoo Basin projects. According to the conferencereport, Congress provided more funds for the popular Continuing AuthoritiesPrograms than requested by the Administration; the conference report also continuedthe recent trend of identifying specific priority projects for funding under theseprograms.

H.R. 4818 ( P.L. 108-447 ) contains some authorization language. Although the bill does not contain authorization of the Upper MississippiRiver-Illinois Waterway navigation and ecosystem restoration project, it provides$13.5 million in funding to proceed with the planning of the controversial navigationproject. The bill provides $17.5 million, which is less than the $28 million requestedby the Administration, for the Upper Mississippi River System's EnvironmentalManagement Program, which complements the proposed ecosystem restorationproject.

Key Policy Issues -- Corps of Engineers

Funding Level. Funding for the Corps' civil works program often has been a contentious issue between theAdministration and Congress, with final appropriations typically providing morefunding than requested, regardless of which political party controls the White Houseand Congress. The FY2003 and FY2004 appropriations bills added funds above theAdministration's request; they were, respectively, $466 million (11%) and $370million (9%) above the requested amounts. The FY2005 budget request proposed a10% cut from the enacted FY2004 appropriations; H.R. 4818 ( P.L.108-447 ) appropriates 14% more than the request.

The House Transportation and Infrastructure Subcommittee on Water Resources and Environment held a hearing on the Corps' FY2005 budget on February 26, 2004. On March 10, 2004, the House Appropriations Subcommittee on Energy and WaterDevelopment held its hearing. The Senate Appropriations Subcommittee on Energyand Water held a hearing on April 20, 2004. At these hearings, some Members ofCongress raised concerns that the Administration's request represented a reductionin each of the major Corps accounts. At these hearings, Assistant Secretary of theArmy Woodley mentioned the Corps' use of a performance-based approach indeveloping the budget request (i.e., providing funding to the projects that it identifiesas having the highest economic and environmental returns). Some Membersexpressed particular concern about the application of performance-based budgetingand OMB's role in delayed use of FY2004 funds for congressionally added projects.

The Administration's FY2005 funding levels for navigation operation and maintenance and beach renourishment policy changes have drawn criticism fromsome stakeholders and support from others. House and Senate Waterways Caucusesannounced their formation at a kick-off meeting on May 21, 2004. Caucus membersspoke on the importance of the nation's waterways to trade, tourism, and recreation;they also asserted a need for increased funding for the civil works program.

H.R. 4818 ( P.L. 108-447 ) maintained the FY2004 spending level for O&M. The bill did not provide the $35 million reserve requested for emergencyrepairs, which had received $15 million in FY2004. O&M funding for somenavigation channels was restored by H.R. 4818 ( P.L. 108-447 ); notably, thebill increased O&M funds above the President's request for many segments of theAtlantic Intracoastal Waterway, with FY2005 appropriations for the waterwayreaching a level about 85% of previous years' appropriations. The bill also increasedthe O&M funding for the controversial waterway of the Apalachicola,Chattahoochee, and Flint Rivers from $0.1 million to $6 million.

Savings and Slippage and Reprogramming. Corps appropriations include a reduction for Saving and Slippage (S&S) to account for the slip of spending on projects due todelays caused by weather, non-federal sponsor financing, or a decision not to proceed-- or to account for savings from a project costing less than estimated. TheAdministration in its budget estimate proposes an S&S rate for various Corpsaccounts; Congress maintains or modifies these rates during the appropriationsprocess. The enacted S&S rates are normally applied across the board to all projectsin an account, except for those activities specifically set forth in act language. S&Srates that exceed the actual saving and slippage experienced could contribute toappropriations constraints on the progress of projects. Over the course of the fiscalyear, the Corps reprograms funds within an account from the projects that are notproceeding as planned to those that are moving forward. There is no statutorylanguage permitting or prohibiting reprogramming of funds; however, Congressprovided specific guidance in the past with regard to reprogramming of theconstruction account in report language. The conference report for H.R. 4818 ( P.L. 108-447 ) ( H.Rept. 108-792 ) lays out for the Corps general criteria forreprogramming. The conference report shows savings and slippage rates of 20% forthe general investigations account consistent with the Administration's request fora 20% rate, and 10% for general construction, which was above the 8% rate used bythe Administration.

Proposed "Reforms" of Corps Processes and Procedures. During the 106th Congress, the Corps came undercriticism for the way it evaluates and undertakes projects. Although the issuereceived media attention in the 107th Congress, it was not directly addressed throughlegislation. Corps reform was debated during consideration of Water ResourceDevelopment Act (WRDA) bills in the 108th Congress; Corps reform reportedly hasplayed a role in recent WRDAs' not being enacted. H.R. 4818 ( P.L.108-447 ) contains no Corps reform provisions. For more information, see CRS Report RL30928, Army Corps of Engineers: Reform Issues for the 107th Congress ,by [author name scrubbed], and CRS Issue Brief IB10133, Water Resources DevelopmentAct (WRDA) and Other Army Corps of Engineers Legislation, coordinated by NicoleT. Carter.

Everglades. A significant addition to the Corps' mission in recent years is its growing role in large environmentalrestoration programs, raising concerns that funding for these programs could displacethe funding for other water resources activities. (See CRS Issue Brief IB10120, ArmyCorps of Engineers Civil Works Program: Issues for Congress, by [author name scrubbed]and [author name scrubbed], for more information.) The Corps plays a significantcoordination role in the restoration of the Central and Southern Florida ecosystem.The Corps is particularly involved in the planning, construction, and operation offacilities under the Comprehensive Everglades Restoration Plan (CERP) that wasauthorized by Title VI of the Water Resources Development Act of 2000 ( P.L.106-541 ). The annual Energy and Water Development Appropriations bill providesfunding for the Corps' participation in these efforts. Everglades restoration alsoreceives a significant portion of its funding through the Department of the Interiorappropriations bills. For more information on Everglades funding for Interioragencies, see CRS Report RL32306 , Appropriations for FY2005: Interior andRelated Agencies , coordinated by Carol Hardy-Vincent and [author name scrubbed].

The President's request for FY2005 included a total of $130 million for the Corps' construction projects in the region. The FY2005 request for the KissimmeeRiver restoration project and the Everglades and South Florida ecosystem restorationproject was $18.0 million and $27.0 million, respectively. For the Central andSouthern Florida project, the Administration requested $85.6 million; $67 million ofthis is for CERP. H.R. 4818 ( P.L. 108-447 ) would provide $121.25million for Everglades restoration, which is less than the $130 million requested bythe Administration, and includes $2.25 million for a Florida Keys Water QualityImprovement project. The Kissimmee River project would receive $18 million asrequested; the Everglades and South Florida ecosystem restoration project wouldreceive $26 million, and the Central and Southern Florida project $75 million.

Missouri River Management. Although the Missouri River is managed by the Corps, the Missouri River receivedthe most congressional attention in 2004 in the context of S. 2804 , theInterior and Related Agencies Appropriations bill for FY2005. A provision tochange a trigger that requires the Corps to implement drought conservation measureson the Missouri River remained in S. 2804 after a debate to have itremoved during committee markup. The drought conservation measures would havesuspended navigational releases from Missouri River reservoirs if storage at thereservoirs falls below a defined level. No similar language was included in theHouse-passed bill. H.R. 4818 ( P.L. 108-447 ) does not contain a similarprovision. For more information on the Missouri River provision, see CRS Report RL32306 , Appropriations for FY2005: Interior and Related Agencies , coordinatedby Carol Hardy-Vincent and [author name scrubbed]. For more information on Missouri Rivermanagement, see CRS Issue Brief IB10120, Army Corps of Engineers Civil WorksProgram: Issues for Congress, by [author name scrubbed] and [author name scrubbed].

In the context of Energy and Water Development Appropriations, the level of funding for Missouri River mitigation measures was the main issue. H.R. 4818 ( P.L. 108-447 ) provides $19 million for Missouri River fishand wildlife recovery. The President's FY2005 budget request was for $69 million;it would have covered expenses associated with environmental measures to complywith the U.S. Fish and Wildlife Service's Biological Opinion to protect threeendangered species. The measures covered by the President's request would haveincluded shallow water habitat for the pallid sturgeon and sandbar habitat for twoshorebirds. The activities covered by the President's request, unlike previousmitigation, would not have been restricted to river segments used for navigation; theFY2005 request was for activities along the length of the Missouri River from thereservoir at Fort Peck to the confluence of the Missouri River and Mississippi Riverat St. Louis.

The amount appropriated for mitigation in the Energy and Water Development Appropriations Act of FY2004 had been $18 million. (The President's FY2004request had been for $22 million.) The Corps reprogrammed $23 million in FY2004funds to provide for the environmental measures needed to implement the MissouriRiver Master Manual in the 2004 navigation season.

Title II: Department of the Interior

For the Department of the Interior, the Energy and Water Development billprovides funding for the Bureau of Reclamation (BOR) and the Central Utah ProjectCompletion Account.

Table 5. Energy and Water Development Appropriations Title II: Central Utah Project CompletionAccount ($ millions)

a. Calculated from text of H.Rept. 108-554 . House does not give a figure for Central Utah Project Construction.

b. Does not include the modified rescission amount of 0.80% in H.Con.Res. 528 .

Central Utah Project

For FY2005, the President requested $48.0 million for the Central Utah Project (CUP) Completion Account, an increase of $10.0 million over the FY2004 enactedamount. The conference agreement also includes $48 million for the CUPcompletion account.

Table 6. Energy and Water Development Appropriations Title II: Bureau of Reclamation ($ millions)

Source: H.Rept. 108-554 . Budget justifications for FY2005 from the Bureau of Reclamation.

a. Includes an across-the-board rescission of .59% included in the FY2004Consolidated Appropriations Act, P.L. 108-199 , enacted on January 23, 2004.

b. In its request, the Bureau lists this as an "offset"; the House bill does not treat theCVP collections as an offset.

c. The FY2005 request includes a proposal that funds be transferred to the Water andRelated Resources account of the Bureau of Reclamation from the WesternArea Power Administration (WAPA) account in Title III. The House bill doesnot include such a transfer.

d. Calculated by CRS.

e. Budget justifications for FY2005 from the Bureau of Reclamation show a requestof $828.5 million for the Water and Related Resources Account for FY2005 and acorresponding $956.3 million in Gross Current Authority. The request was amendedMay 6, 2004, to account for payment of the Sumner Peck settlement agreement outof other government funds.

f. This item was $5M smaller in the original House table.

g. Does not include the modified rescission amount of 0.80% in H.Con.Res. 528 .

Bureau of Reclamation Budget In Brief

The FY2005 request for BOR totals $922.3 million in gross current budget authority. (1) This amount is $20.4 million less thanenacted for FY2004 in P.L.108-137 , including the rescission of $5.1 million included in the FY2004Consolidated Appropriations Act (PL. 108-199). The FY2005 request includes a $46million "offset" for the Central Valley Project (CVP) Restoration Fund, and aHydropower Direct Financing offset of $30.0 million (transferred from the WesternArea Power Administration (WAPA) account in Title III), yielding a "net" currentauthority of $846.3 million for BOR. The House bill ( H.R. 4614 )includes $973.2 million in gross current authority; the conference agreement includes$972.3 million. Neither allowance includes the transfer from the WAPA account.

BOR's single largest account, Water and Related Resources, encompasses the agency's traditional programs and projects, including operations and maintenance,the Dam Safety Program, Water and Energy Management Development, and Fish andWildlife Management and Development, among others. The House bill, H.R. 4614 , includes $860 million for the Water and Related Resourcesaccount; the conference agreement includes $859.5 million. The BOR requested$794.5 million for this account for FY2005, $57.9 million less than appropriated in P.L. 108-137 for FY2004; however, BOR budget justifications for FY2005 note arequest of $828.5 million, which is approximately $24.0 million less than enacted forFY2004. The agency initially requested $34 million for part of a three-year annualpayment as part of the Sumner Peck settlement; however, a subsequent decision wasmade to fund the payment from another government account. An amendment to therequest was submitted to Congress on May 6, 2004.

Key Policy Issues -- Bureau of Reclamation

Background. Most of the large dams and water diversion structures in the West were built by, or with the assistanceof, the Bureau of Reclamation (BOR). Whereas the Army Corps of Engineers builthundreds of flood control and navigation projects, BOR's mission was to developwater supplies, primarily for irrigation to reclaim arid lands in the West. Today,BOR manages hundreds of dams and diversion projects, including more than 300storage reservoirs in 17 western states. These projects provide water toapproximately 10 million acres of farmland and 31 million people. BOR is thelargest wholesale supplier of water in the 17 western states and the second largesthydroelectric power producer in the nation. BOR facilities also provide substantialflood control, recreation, and fish and wildlife benefits. At the same time, operationsof BOR facilities are often controversial, particularly for their effect on sensitive fishand wildlife species and conflicts among competing water users.

CALFED. Funds have not been appropriated for the California Bay-Delta Restoration Account (Bay-Delta, orCALFED) since FY2000, when the authorization for appropriations expired. However, funds were provided for FY2002, FY2003, and FY2004 for activities thatsupport the CALFED program -- but not for the CALFED program account. TheAdministration requested $15 million for this account for FY2005. For FY2005, theHouse Committee on Appropriations recommended that no funds be appropriated forCALFED, and no funds are included in the omnibus bill. Consistent with past years,the committee notes it has recommended "no funding (for CALFED) in the absenceof authorizing legislation for this multi-year, multi-billion dollar effort." Theconference agreement provides, however, a total of $8.5 million from the within theWater and Related Resources Account for certain activities that support the CALFEDprogram. This amount includes $7.5 million for activities that support CaliforniaBay-Delta Restoration, as stated in the conference report, plus an "additional" $1.0million for the Upper San Joaquin River Basin Storage investigation. Other activitiesreceiving funding from the $8.5 million include $1.0 million for Sites Reservoirplanning activities, $1.0 million for Shasta Dam enlargement evaluation, and $1.0million for Los Vaqueros expansion planning. Although the CALFED program wasreauthorized and signed into law October 25, 2004 ( H.R. 2888 , P.L.108-361 ), the appropriations language was not changed. (For more information onCALFED, see CRS Report RL31975 , CALFED Bay-Delta Program: Overview ofInstitutional and Water Use Issues , by [author name scrubbed] and Pervaze Sheikh.)

Security. BOR requested $43.2 million for FY2005 for continued heightened safety and security efforts at BORfacilities. The bulk of the request is for facility operations/security. Funding coverssuch activities as administration of the security program (e.g. surveillance and lawenforcement), anti-terrorism activities, and physical emergency security upgrades.(For more information, see CRS Report RL32189 , Terrorism and Security IssuesFacing the Water Infrastructure Sector , by [author name scrubbed] and [author name scrubbed].) Beginning in FY2005, BOR has planned to assign a portion of site security costs towater users for repayment based on existing project cost allocations for operationsand maintenance activities; however, conferees have noted concern over the plan anddirect BOR to submit a report by May 1, 2005, on reimbursable andnon-reimbursable security costs before implementation of the change and that thereshould be no implementation of the change "until the Congress provides directinstruction to do so."

The House Committee on Appropriations, in H.R. 4614 , recommended $43.2 million for site security, and the omnibus bill contains thatamount.

Title III: Department of Energy

The Energy and Water Development bill includes funding for most of DOE'sprograms. Major DOE activities in the bill include research and development onrenewable energy and nuclear power, general science, environmental cleanup, andnuclear weapons programs. The Administration's FY2005 request for DOE programsin the Energy and Water Development bill was $23.148 billion, about $1.18 billionmore than the amount appropriated for FY2004. (The FY2005 request for DOE'sprograms for fossil fuels, energy efficiency, the Strategic Petroleum Reserve, andenergy statistics, included in the Interior and Related Agencies appropriations bill,was $1.7 billion.) The House bill ( H.R. 4614 ) would have appropriated$22.478 billion. The omnibus bill contains $23.003 billion, less the rescission.

Table 7. Energy and Water Development Appropriations Title III: Department of Energy ($ millions)

Source: Department of Energy budget justifications for FY2005 and H.Rept. 108-554 .

a. Includes an across-the-board rescission of .59% included in the FY2004 ConsolidatedAppropriations Act, P.L. 108-199 , enacted on January 23, 2004.

b. Includes $26.1 million added to the Solar R&D account by the FY2004 ConsolidatedAppropriations Act, P.L. 108-199 , enacted on January 23, 2004.

c. Includes transfer of programs funded at $113.4 million from Energy Supply -- NuclearEnergy to Other Defense Activities.

d. DOE proposes to offset FY2005 appropriations with Nuclear Waste Fee collections, fora net appropriation of zero.

e. Does not include the modified rescission amount of 0.80% in H.Con.Res. 528 .

Key Policy Issues -- Department of Energy

Renewable Energy. The FY2005 budget request aimed to promote "breakthroughs in hydrogen fuel cells," developadvanced technologies for cellulosic biomass as an energy source, and generallylower the cost of various renewable energy systems, while improving equipmentperformance and efficiency. The request also proposed competitive solicitations forapplied research on technologies that would help curb greenhouse gas emissions.

The request sought $374.8 million for renewables, which is $4.3 million, or 1%, more than the FY2004 appropriation. This comparison includes the use of $13.0million in prior year balances for FY2004. The funding request included $13.3million more for Hydrogen (due to increases of $12.1 million for safety and $2.7million for renewable hydrogen), $8.3 million more for Program Direction, and $3.0million for a new National Climate Change Technology program. However, it wouldterminate Program Support (a cut of $4.9 million), cut Biomass Utilization by $15.2million (to terminate Small Modular Biopower and discontinue congressionalearmarks), and cut Concentrating Solar Power by $3.4 million. Also, the requestincluded $90.9 million for the Office of Electricity Transmission and Distribution(OETD), an increase of $9.0 million, or 11%. The primary increase in OETD wasfor High Temperature Superconductivity.

For FY2005, the House in H.R. 4614 approved $343.2 million for Renewable Energy, which is $31.6 million, or 8%, less than the request. The majorpart of this reduction is a decrease of $31.0 million, or 33%, for Hydrogen. Most ofthe decrease for Hydrogen would eliminate support for hydrogen storage "centers ofexcellence," which the House Appropriations Committee's report states DOEawarded "without full and open competition." Further, the House cut $7.0 million(zero appropriation) for DOE's proposed hydrogen education initiative. Also, thereis a cut of $3.0 million (zero appropriation) for the National Climate ChangeTechnology Initiative and an increase of $2.4 million for Concentrating Solar Power.

The conference committee approved $389.1 million for Renewable Energy, which is $14.3 million, or 4%, more than the request. The committee's figureincludes $9.5 million more for Biomass/Biofuels, $6.2 million more for SolarEnergy, and $3.0 million more for Intergovernmental Program Support. For OETD,the conference approved $121.2 million, which is $30.3 million, or 33%, more thanthe request.

Relative to the FY2004 appropriation, the conference committee approved $31.6 million, or 9%, more for renewables. This increase includes $13.3 million more forhydrogen, $6.8 million more for Program Direction, and $3.1 million more for SolarEnergy. Further, there is a decrease of $1.5 million for Facilities and Infrastructure. Also, the committee approved $39.3 million, or 48%, more for OETD. This includesincreases of $21.8 million for R&D, $13.0 million for Electricity Restructuring, and$4.5 million for Program Direction. All these amounts would be reduced by 0.80%with approval of H.Con.Res. 528 .

Nuclear Energy. For nuclear energy research and development -- including advanced reactors, fuel cycletechnology, and nuclear hydrogen production -- the conference report provides$513.3 million, about $100 million above the Administration's request and theFY2004 appropriation. The total includes $124.3 million from Other DefenseActivities and Naval Reactors for management of the Idaho National Engineering andEnvironmental Laboratory (INEEL), which is being transferred to the nuclear energyprogram from DOE's environmental management program.

The House Appropriations Committee had declared the Administration's request inadequate to achieve DOE's stated goal of transforming INEEL -- to berenamed Idaho National Laboratory -- into the nation's leading center for nuclearpower research. The House approved a funding increase of $51.2 million, for a totalof $463.8 million.

"The benefits of nuclear power as a clean, reliable, and affordable source of energy are a key to economic and environmental underpinnings of the U.S.,"according to DOE's budget justification. However, opponents have criticized DOE'snuclear research program as providing wasteful subsidies to an industry that theybelieve should be phased out as unacceptably hazardous and economicallyuncompetitive.

Within the nuclear energy budget, the conference report provides $50.0 million for the Nuclear Power 2010 program, which "is focused on resolving the technical,institutional, and regulatory barriers to the deployment of new nuclear power plantsby 2010," according to the DOE budget justification. The Administration had sought$10.2 million for the program, about half the FY2004 appropriation and a third of theFY2003 level.

According to the DOE budget justification, the Nuclear Power 2010 program "will enable an industry decision by 2005 to deploy at least one new advancednuclear power plant in the U.S." The current phase of the initiative includes siteapproval, reactor design certification, license applications, detailed design work, anddevelopment of improved construction techniques. DOE will pay up to half the costof these activities. The program is currently helping three utilities seek NRCapproval for potential nuclear reactor sites in Illinois, Mississippi, and Virginia. InMarch and April of 2004, three industry consortia filed applications seeking a totalof $650 million over the next several years to design and license new nuclear powerplants. The nuclear plant licenses under the program would test the "one step"licensing process established by the Energy Policy Act of 1992 ( P.L. 102-486 ).

The House Appropriations Committee had voted to cut the Nuclear Power 2010 program to $5.0 million in FY2005, contending that NRC should not issue newreactor licenses "in the absence of a repository for spent nuclear fuel." As discussedin a later section, the Administration's funding request for DOE's waste repositoryprogram created considerable friction with the House Appropriations panel andcontributed to the absence of a Senate markup.

The conference report includes $40.0 million for the Generation IV Nuclear Energy Systems Initiative, which focuses on more-advanced reactors that could bedeployed in the longer term. The conference level is about the same as the amountapproved by the House and $10 million above the Administration request.

The Generation IV program is focusing on six advanced designs that could be deployed after 2010: two gas-cooled, one water-cooled, two liquid-metal-cooled, andone molten-salt concept. Some of these reactors would use plutonium recoveredthrough reprocessing of spent nuclear fuel. The Administration's May 2001 NationalEnergy Policy report contends that plutonium recovery could reduce the long-termenvironmental impact of nuclear waste disposal and increase domestic energysupplies. However, opponents contend that the separation of plutonium from spentfuel poses unacceptable environmental risks and, because of plutonium's potentialuse in nuclear bombs, undermines U.S. policy on nuclear weapons proliferation.

The development of plutonium-fueled reactors in the Generation IV program is closely related to the nuclear energy program's Advanced Fuel Cycle Initiative(AFCI), for which the conference report provides $68.0 million -- about the sameas the FY2004 level and the amount approved by the House. The Administration hadproposed cutting the program to $46.3 million. According to the budget justification,AFCI will "develop advanced, proliferation-resistant nuclear fuel cycle technologies"that could reduce the long-term hazard of spent nuclear fuel and recover additionalenergy. Such technologies would involve separation of plutonium, uranium, andother long-lived radioactive materials from spent fuel for re-use in a nuclear reactoror for transmutation in a particle accelerator. The program includes longstandingDOE work on electrometallurgical treatment of spent fuel from the ExperimentalBreeder Reactor II (EBR-II) at INEEL.

In support of President Bush's program to develop hydrogen-fueled vehicles, DOE is requesting $9.0 million in FY2005 for the Nuclear Hydrogen Initiative,nearly a 50% increase from the FY2004 level. The conference report followed theHouse's lead in providing the full funding request. According to DOE's budgetjustification, the program would investigate the use of high-temperature nuclearreactors to make hydrogen from water in a thermochemical process. According toDOE, "preliminary estimates . . . indicate that hydrogen produced usingnuclear-driven thermochemical or high-temperature electrolysis processes would beonly slightly more expensive than gasoline" and result in far less air pollution.

An advanced reactor that would demonstrate co-production of hydrogen and electricity -- the Next Generation Nuclear Plant (NGNP) -- is allocated $25.0million from DOE's Generation IV program by the conference report. "Theconferees expect the Department to submit a budget in fiscal year 2006 that isconsistent with the goal of demonstrating hydrogen production and electricitygeneration by 2015 at the Idaho National Laboratory," according to the statement ofmanagers.

DOE sought no new funding specifically for the Nuclear Energy Research Initiative (NERI), which provides grants for research on innovative nuclear energytechnologies. Instead, according to the budget justification, NERI projects will bepursued at the discretion of individual nuclear R&D programs. NERI received anappropriation of $11 million for FY2004. New funding also was not requested forthe Nuclear Energy Plant Optimization program (NEPO), which received $2.9million in FY2004. The program supports cost-shared research by the nuclear powerindustry on ways to improve the productivity of existing nuclear plants. Althoughthe House Appropriations Committee agreed to provide no new funding for NERIand NEPO, the conference report includes $2.5 million for each program.

Science. The DOE Office of Science conducts basic research in six program areas: basic energy sciences,high-energy physics, biological and environmental research, nuclear physics, fusionenergy sciences, and advanced scientific computing research. Through theseprograms, DOE is the third-largest federal supporter of basic research and the largestfederal supporter of research in the physical sciences.

For FY2005, DOE requested $3.432 billion for Science. The FY2004 appropriation was $3.482 billion. (2) On this basis, theFY2005 request was a decreaseof 1%. Some Administration statements asserted that the request reflected a 2%increase, if the FY2004 baseline was taken to exclude funds provided for specificcongressionally directed projects. The House bill provided $3.600 billion. Theconference agreement provided $3.629 billion. (3) After taking into account the generalreduction of 0.80%, the conference agreement represented an increase of 3% abovethe FY2004 appropriation.

The requested funding for the largest program, basic energy sciences, was $1.064 billion, an increase of $53 million above the comparable FY2004appropriation. Nanoscience is a growth area in basic energy sciences. Along withother nanoscience funding, the FY2005 request included $99 million for constructionof four Nanoscale Science Research Centers. The House bill provided $1.077 billionfor basic energy sciences. Part of the $13 million increase was for additionalnanoscience research, and nanoscience center construction was fully funded at therequested level. The conference agreement provided $1.114 billion for basic energysciences. After the general reduction, this was a 9% increase above FY2004.

The FY2005 request for high-energy physics was $737 million, an increase of $4 million above the comparable FY2004 appropriation. The House bill provideda further increase of $16 million, for a total of $753 million. The conferenceagreement provided $742 million. After the general reduction, this was a 3%increase above FY2004. The House report expressed support for DOE'scollaboration with the National Aeronautics and Space Administration (NASA) onthree scientific spacecraft, and encouraged NASA to maintain the planned schedulesof these missions, which are in question following the President's announcement inJanuary 2004 of a new vision for NASA. (4) Theconference agreement encouragedDOE to proceed with the Dark Energy Mission, but did not mention the other twospacecraft.

The requested funding for biological and environmental research was $502 million, a decrease of $140 million below the comparable FY2004 appropriation. The request noted that the decrease corresponded to $140 million that was providedin FY2004 for congressionally directed projects. The House bill provided $572million, or $75 million more than requested, but did not include $5 million requestedfor a new laboratory facility. The House report stated that such facilities should beprocured in a more open competition that includes universities and others as well asDOE laboratories. The conference agreement provided $587 million. After thegeneral reduction, this was a 9% decrease from FY2004; almost all of the decreaseresulted from a reduction in funding for congressionally directed projects. Theconference agreement included $10 million for the new laboratory facility, but itexpressed disagreement with DOE's "strategy of restricting competition for such afacility to only the DOE national laboratories," and it directed DOE to include analternate, more competitive strategy in the FY2006 budget request.

The request for nuclear physics was $401 million, an increase of $11 million above the comparable FY2004 appropriation. The House bill provided $415 million,a further increase of $14 million. The conference agreement provided $408 million,a 4% increase above FY2004 after applying the general reduction.

The request for fusion energy sciences was $264 million, a $2 million increase above the comparable FY2004 appropriation. In 2003, the United States rejoinednegotiations on construction of the International Thermonuclear ExperimentalReactor (ITER), a fusion facility whose other participants include China, theEuropean Union, Japan, Russia, and South Korea. The requested FY2005 budget forfusion energy sciences included $7 million devoted directly to ITER preparations,plus another $31 million in supporting activities. The budget impact of ITER infuture years, once construction begins, will depend on the outcome of the ongoingnegotiations; the U.S. share is generally expected to be in the range of $50 millionto $100 million per year. Appropriations conference report language in FY2004cautioned DOE not to submit "any future budget requests for ITER that are fundedat the expense of domestic research." The House bill provided $276 million forfusion energy sciences, $12 million more than the request, even though site selectionfor ITER has been delayed, which the House report anticipated will result in DOEspending less than planned on ITER in FY2005. The conference agreement provided$276 million, for a 5% increase above FY2004 after applying the general reduction. Also noting the delay in site selection, the conference report directed DOE to reduceits planned expenditures on ITER in FY2005.

The smallest Science program, advanced scientific computing research, was funded at $204 million in the FY2005 request, an increase of $2 million above theFY2004 appropriation. The House bill provided $234 million. The $30 millionincrease recommended by the House was for development of hardware, software, andapplied mathematics for supercomputing, and the House report encouraged DOE tomake time on the resulting supercomputer available to external users on acompetitive basis. The conference agreement also provided $234 million. After thegeneral reduction, this is an increase of 15% above FY2004. The conference reportsupported the House language regarding the $30 million increase, and directed thatno more than $25 million of it should be devoted to hardware.

The House report and conference report also included general discussion of three major issues: external regulation of laboratories, competition for new facilities,and facility operating time. The House report expressed strong support for externalregulation of the DOE Science laboratories and strong displeasure with DOE's"continued intransigence" in moving from self-regulation to external regulation. Both reports advocated open competition for new research facilities and broaderparticipation by universities. Both made mention of the recently published 20-yearstrategic plan for Office of Science facilities. (5) TheHouse report commended theOffice of Science for its efforts in developing quantifiable performance measures,such as facility operating time, for which several individual Science programsreceived additional funding. The conference report encouraged DOE to requestsufficient funds for FY2006 to operate user facilities for as much time as possible.

Nuclear Weapons Stockpile Stewardship. Congress established the Stockpile StewardshipProgram in the FY1994 National Defense Authorization Act ( P.L. 103-160 ) "toensure the preservation of the core intellectual and technical competencies of theUnited States in nuclear weapons." The program is operated by the National NuclearSecurity Administration (NNSA), a semiautonomous agency established by Congressin the FY2000 National Defense Authorization Act ( P.L. 106-65 , Title XXXII)within DOE. It seeks to maintain the safety and reliability of the U.S. nuclearstockpile.

Most stewardship activities take place at the nuclear weapons complex, which consists of three laboratories (Los Alamos National Laboratory, NM; LawrenceLivermore National Laboratory, CA; and Sandia National Laboratories, NM andCA), four production sites (Kansas City Plant, MO; Pantex Plant, TX; SavannahRiver Site, SC; and Y-12 Plant, TN), and the Nevada Test Site. NNSA manages andsets policy for the complex; contractors to NNSA operate the eight sites.

Stockpile stewardship consists of all activities in NNSA's Weapons Activities account. Appropriations were $4,908.7 million for FY2001, $5,560.2 million forFY2002, and $5,961.3 million for FY2003; Table 7 provides FY2004 and FY2005data. The three main elements of stockpile stewardship, described next, are DirectedStockpile Work (DSW), Campaigns, and Readiness in Technical Base and Facilities(RTBF); Table 7 presents funding for these elements. NNSA also manages twomajor programs outside of Weapons Activities: Defense Nuclear Nonproliferation,discussed in a subsequent section of this report, and Naval Reactors.

Table 8. Funding for WeaponsActivities ($ millions)

Source for FY2004 comparable appropriation and FY2005 request: U.S. Departmentof Energy. Office of Management, Budget, and Administration/ CFO. FY 2005Congressional Budget Request. volume 1, National Nuclear Security Administration. DOE/ME-0032, February 2004, p. 49.

Notes: Details may not add to totals due to rounding.

There was no Senate bill.

a. Reflects distribution of a rescission from P.L. 108-199 , FY2004 Consolidated Appropriations Act, and adjustments to make FY2004 appropriation categoriescomparable to those of the FY2005 request.

b. Figures do not reflect an across-the-board reduction of 0.80%.

c. Includes Secure Transportation Asset, Nuclear Weapons Incident Response,Facilities and Infrastructure Recapitalization Program, Safeguards and Security,Safeguards and Security Charge for Reimbursable Work (an offset), use of prioryear balances, and (for omnibus bill, FY2005) transfer from Department ofDefense Appropriations.

On July 18, 2003, the House passed H.R. 2754 , the FY2004 Energy and Water Development Appropriations Bill, 377-26, without amending theWeapons Activities section. Thus, the FY2004 amounts listed below that wererecommended by the House Appropriations Committee were accepted by the House. The Senate passed its version of H.R. 2754, 92-0, on September 16, 2003;it adopted no amendments to the Senate Appropriations Committee's bill thatchanged Weapons Activities funding. The conference report, H.Rept. 108-357 , wasordered to be printed on November 7, 2003. On November 18, 2003, the Houseagreed to the conference report, 387-36, and the Senate agreed to it by unanimousconsent. The President signed the measure into law ( P.L. 108-137 ) on December 1,2003. The FY2004 Consolidated Appropriations Act imposed an across-the-boardrescission of 0.59 percent; it was signed into law ( P.L. 108-199 ) on January 23, 2004.

The FY2005 request includes data from NNSA's Future Years Nuclear Security Program (FYNSP), which projects the budget and components through FY2009.

Table 9. NNSA Future Years Nuclear Security Program ($ millions)

Source: Department of Energy, FY2005 Congressional Budget Request, vol. 1, p.50, 63. Figures for the Robust Nuclear Earth Penetrator (RNEP) for the outyearshave changed from this budget document, as discussed below. They are in flux, soare not available. RNEP is funded under DSW; this table shows DSW funding aspresented in the budget document.

Notes: Details may not add to totals because of rounding.

a. Includes Secure Transportation Asset, Nuclear Weapons Incident Response,Facilities and Infrastructure Recapitalization Program, Safeguards and Security,and Security Charge for Reimbursable Work.

On June 18, 2004, the House Appropriations Committee reported its FY2005 Energy and Water Development Appropriations Bill ( H.R. 4614 , H.Rept. 108-554 ). The House approved the bill, as amended, on June 25, by a voteof 370-16. There were no amendments to the Weapons Activities portion of the bill. In the Senate, the Energy and Water Development Appropriations Subcommittee didnot report a bill to the full committee, so that committee did not report a bill to theSenate.

The omnibus appropriations bill subsumes nine regular appropriations bills. Of the nine, the Energy and Water Development appropriations bill was the hardest toresolve. Indeed, press reports raised the prospect that that bill might have beenexcluded from the omnibus, with its programs funded instead through a year-longcontinuing resolution that would have maintained funding at the FY2004 level. Thesticking point was over funding for Yucca Mountain, an underground repository forcivilian nuclear waste, which Senator Domenici, the Chairman of the Senate Energyand Water Development Appropriations Subcommittee, favored. (For details onYucca Mountain, see the "Civilian Nuclear Waste" section in this report.) At thesame time, the House had voted to drop funding for several nuclear weaponsprograms that Representative Hobson, who chaired the House Energy and WaterDevelopment Appropriations Subcommittee, had strenuously opposed. The Senatehad favored these weapons programs in the FY2004 budget cycle.

According to numerous press reports, the arrangement that broke the logjam was that several nuclear weapons programs (discussed below) were eliminated, reduced,or modified. At the same time, conferees freed up $800 million from various partsof the omnibus bill. Some of this money was used to provide $577 million for YuccaMountain instead of the $131 million provided by the House. Further, confereesprovided $40.0 million for the chemistry and metallurgy facility replacement projectat Los Alamos National Laboratory, NM, compared to $10.0 million in the Housebill, and $91.1 million for the Microsystem and Engineering Science Applicationsproject at Sandia National Laboratories, NM, compared to $53.3 million in the Housebill. Conferees also added $30.9 million for constructing a Center for IntegratedNanotechnologies, a joint venture between Los Alamos and Sandia NationalLaboratories to be located at Kirtland AFB, NM. (6)

Directed Stockpile Work (DSW). This program involves work directly on nuclear weapons in the stockpile, such asmonitoring their condition, maintaining them through repairs, refurbishment, lifeextension, and modifications; R&D in support of specific warheads; anddismantlement. The FY2005 DSW request would support life extension programsfor four nuclear warheads: B61 (gravity bomb), W76 (for Trident I and IIsubmarine-launched ballistic missiles), W80 (for cruise missiles), and W87 (forMinuteman III and MX/Peacekeeper intercontinental ballistic missiles). It wouldfund surveillance and maintenance for nine warhead types, and some managementand technology work not linked to a specific warhead.

The FY2004 energy and water development conference report directed DOE and the Department of Defense to prepare a report on the stockpile plan through 2012 soas to see how the stockpile would be adjusted to meet the requirements of theStrategic Offensive Reductions Treaty, which would reduce U.S. and Russianstrategic nuclear warheads to 1,700 to 2,200 by December 2012. (See CRS Report RL31448 , Nuclear Arms Control: The Strategic Offensive Reductions Treaty, fordetails on that treaty.) That classified report was delivered to Congress on June 1,2004. In its FY2005 report on energy and water appropriations, the HouseAppropriations Committee stated that the new stockpile plan "obviates the need forany programmatic acceleration in the Life Extension Program activities for the B61,W76, and W80." To this end, the committee recommended reducing DSW LifeExtension Programs by $40.0 million, to $437.4 million, with the reduction takenagainst the life extension program for the W80. As noted, the House did not amendthe Weapons Activities account. The omnibus bill provided $460.8 million, leavingB61 at the requested $117.9 million, increasing W76 to $236.4 million, and reducingW80 to $106.4 million. Following up the stockpile report, the committee directedDOE to submit a report on requirements for the nuclear weapons complex over thenext 25 years, due April 30, 2005. The House Appropriations Committeerecommended reducing DSW Stockpile Systems by $40.0 million, to $496.1 million,with the reduction taken against such activities for the W80 and W87 "to reduce thesignificant program increase over current year levels pending the recommendationsof the weapons complex review." The omnibus bill reduced DSW Stockpile Systemsto $511.1 million, with reductions to the W80 and W87.

Robust Nuclear Earth Penetrator (RNEP) and Advanced Concepts Initiative (ACI). DSW also includes funds for a study of RNEP, forwhich $15.0 million was appropriated for FY2003, $15.0 million was requested and$7.5 million appropriated for FY2004, and $27.6 million requested for FY2005. RNEP is part of ACI, which was established to explore future weapons concepts andtechnologies. Earth penetrators burrow into the ground before detonating in order todestroy underground targets with less explosive yield than a surface-burst weaponwould require. (See CRS Report RL32130 , Nuclear Weapon Initiatives: Low-YieldR&D, Advanced Concepts, Earth Penetrators, Test Readiness, and CRS Report RL32347 , Robust Nuclear Earth Penetrator Budget Request and Plan,FY2005-FY2009 .)

RNEP is controversial. Supporters argue that it is needed to attack hard and deeply buried targets (such as leadership bunkers or chemical weapons productionfacilities) in countries of concern, thereby deterring or defeating such nations; criticsreply that RNEP would lower the threshold for use of nuclear weapons and promptother nations to develop nuclear weapons to deter U.S. attack.

Secretary Rumsfeld said in 2003 that RNEP "is a study. It is nothing more and nothing less." (7) The study is examining feasibilityand cost. Yet the FY2005 requestseems to cast serious doubt on assertions that RNEP is only a study. Beginning withthe FY2005 budget cycle, NNSA presented a detailed four-year projection along withthe current request. For RNEP, the figures are: FY2005, $27.6 million; FY2006,$95.0 million; FY2007, $145.4 million; FY2008, $128.4 million; and FY2009, $88.4million, for a five-year total of $484.7 million. (8) Along with the increase, the planshows RNEP starting -- assuming congressional authorization -- developmentengineering, in which the nuclear weapons laboratories produce a completed warheaddesign, in FY2007, and production engineering, in which the design is adapted forproduction and a system to manufacture the weapon is created, in FY2009.

An NNSA manager responsible for the program maintained that the budget increase beyond FY2005 is an artifact of the budget process. (9) He stated that themoney was inserted in the out years as a "placeholder" to protect the option ofproceeding with RNEP. Were this not done, it is argued that NNSA would face twochoices that it deems unsatisfactory: (1) By the time the budget for one fiscal yearis submitted, the budget for the next fiscal year is largely fixed; without theplaceholder, a decision to proceed with RNEP could not be implemented until thesecond fiscal year. (2) Alternatively, without the placeholder, a decision to proceedwith RNEP could be implemented promptly only by taking the needed funds out ofother programs. Similarly, the move to development engineering and productionengineering reflects how the program might be expected to advance if it proceeds. The official, however, indicated that no decision has been made on whether or notto proceed with RNEP pending completion of the study.

The RNEP study was initially projected to cost $45 million -- $15 million a year for FY2003-FY2005 -- but each year's numbers have changed. For FY2003,delay in submission of a DOD study required by the FY2003 National DefenseAuthorization Act ( P.L. 107-314 , Sec. 3146) delayed the start of NNSA's RNEPstudy; as a result, $6.0 million was spent of the $15.0 million appropriated. ForFY2004, Congress cut the RNEP appropriation to $7.5 million. The FY2005 requestis $27.6 million, vs. $15.0 million originally planned. Finally, FY2006, not FY2005,will be the last year of the RNEP study; NNSA estimates the FY2006 request at $30million. The four-year total is about $71 million. NNSA stated that a firm budgetestimate for RNEP beyond FY2006 must await completion of the cost study.

According to NNSA, the study's cost has grown for a number of reasons. The $45 million did not take into account participation in the study by Y-12 Plant, whichwould make components of RNEP, or of Pantex Plant, which would convert existingweapons into RNEPs; their participation adds some $2 million. DOE has imposedadditional project management requirements that add $2 million. The rest of theincrease comes from a better definition of the requirements of the study, refinementof cost estimates, and an increase in surety (safety, security, and use control) of theproposed weapon. On the latter point, DOE requires that any modifications of anuclear weapon look for ways to increase its surety. (10) NNSA says it has found waysto increase RNEP surety, and plans to do so.

The two Armed Services Committees recommended providing the full amount requested for RNEP for FY2005, $27.6 million, and House and Senate flooramendments to delete such funding were rejected. In contrast, the HouseAppropriations Committee eliminated RNEP and ACI funds for FY2005. It sawthese two programs as a "diversion of resources ... from the most serious issues thatconfront the management of the nation's nuclear deterrent" and "remain[ed]unconvinced" by DOE's assurances that RNEP is only a study and ACI is only todevelop weapon design skills. It found that DOE actions "left little doubt that theobjective of the program [RNEP and ACI] was to advance the most extreme newnuclear weapon goals irrespective of any reservations expressed by Congress." Accordingly, "[t]he Committee directs the NNSA to focus wholly on its primarymission of maintaining the safety, security, and viability of the existing stockpile." As a part of the compromise discussed earlier, the omnibus bill eliminated funds forRNEP and ACI.

ACI has also been controversial. Critics claimed that its purpose was to develop a low-yield "mini-nuke" that would make nuclear weapons more usable; supportersresponded that ACI was not working on a mini-nuke and that ACI would helpdevelop and maintain weapons design expertise. The Administration requested $9.0million for ACI for FY2005. The House provided no funds for it for reasons justnoted. The House Appropriations Committee stated that its priorities are maintainingthe stockpile and countering WMD proliferation, and found that DOE's "obsessionwith launching a new round of nuclear weapons development runs counter to thosepriorities." While the omnibus bill provided no funds for ACI, the conference reportstated that "the same amount is made available for the Reliable ReplacementWarhead program to improve the reliability, longevity, and certifiability of existingweapons and their components."

Campaigns. These are "multi-year, multi-functional efforts" that "provide specialized scientific knowledge and technicalsupport to the directed stockpile work on the nuclear weapons stockpile." ForFY2005, there are six campaigns, each of which has multiple components: Science;Engineering; Inertial Confinement Fusion and High Yield; Advanced Simulation andComputing; Pit Manufacturing and Certification, and Readiness.

The House Appropriations Committee commended NNSA for "great progress in budgeting by weapons type" (e.g., the amount requested for extending the life ofthe W80 warhead). On the other hand, it expressed its concern that NNSA'saccounting system still did not provide the full cost of weapon refurbishmentsbecause it did not assign the cost of campaigns to specific warhead types. Accordingly, "[t]he Committee directs the NNSA to assign the associated lifeextension costs by weapons type associated with each campaign."

Pit Manufacturing and Certification Campaign. This is perhaps the most controversial campaign at present. It may remain so for some yearsbecause one component of it is a facility that may cost several billion dollars and isscheduled to start initial operations in FY2019, and other components of thecampaign involve restoring U.S. ability to manufacture pits, a critical nuclear weaponpart. Pits are the fissile cores of nuclear warheads that trigger the thermonuclearsecondary stage. DOE has had no facility to produce pits for use in stockpiledweapons since it suspended pit production at the Rocky Flats Plant (CO) in 1989. Asa result, the United States has been unable to make all-new nuclear warheads ofexisting or advanced new designs. (See CRS Report RL31993 , Nuclear Warhead'Pit' Production: Background and Issues for Congress .) For FY2005, this campaignhas five components.

(1) W88 Pit Manufacturing: When Rocky Flats suspended production, it was making pits for the W88 warhead for the Trident II missile. NNSA has established a facility at Los Alamos National Laboratory that is producingthese pits at a low rate, with a target of 10 to 20 pits a year byFY2007.

(2) W88 Pit Certification: Additional scientific work is underway to provide confidence, without nuclear testing, that the Los Alamos pitswill work as intended. These pits cannot be certified for use in the stockpile untilthey meet the standards being developed.

(3) Pit Manufacturing Capability. This component will establish technologies to manufacture pits other than for theW88.

(4) Modern Pit Facility (MPF): NNSA maintains that pits will ultimately develop defects as a result of aging and other unanticipated problems, sothat a higher capacity will be needed in the future. Further, it is argued, since itwould take many years to complete a higher-capacity facility, work on it must beginpromptly. Accordingly, it is planning for MPF, which would be a new facility, firstoperational in FY2019, with a capacity of at least 125 pits per year. It might cost $2billion to $4 billion. Critics maintain that the plutonium component of a pit, whichis by far the most difficult to fabricate, is likely to deteriorate very slowly, andperhaps in a way that would not impair weapon performance. They further state thatthe need for the facility is unclear, given anticipated reductions in nuclear weapons,and that MPF is proceeding at too rapid a pace. To address these questions, NNSAis conducting "accelerated aging experiments," in which plutonium of the type usedin a pit is mixed with a greater-than-usual amount of a more radioactive plutoniumisotope to simulate more quickly the effects of aging.

(5) Pit Campaign Support Activities at Nevada Test Site: NNSA plans to conduct certain experiments at Nevada Test Site to support W88 pitcertification.

This campaign has attracted much congressional interest. For FY2002, the House Appropriations Committee asserted that DOE cannot show "that it has aviable plan to manufacture and certify pits on the schedule dictated by nationalsecurity needs," criticized the project as "years behind schedule and hundreds ofmillions of dollars over the original cost estimate," and stated that it would judgeNNSA's success on how well the pit project succeeds ( H.Rept. 107-112 ). The SenateAppropriations Committee viewed the then-current schedule, which would not certifya pit for use in the stockpile until FY2009, as "unacceptable" ( S.Rept. 107-39 ).

In its FY2003 report, the Senate Appropriations Committee stated that it "remains greatly concerned about the NNSA's refusal to request funds consistentwith its own project plan submitted less than 1 year ago." Because this was not done,"the Committee has been forced to reduce other items in the budget." The finalappropriation provided more funds than requested. According to the joint explanatorystatement of the Committee of Conference, "The increase will ensure that the NNSAmaintains its commitment to produce a certifiable W88 pit by 2003 and a certifiedW88 pit by 2007."

For FY2004, the Administration requested a substantial increase to items in this campaign. The House Appropriations Committee saw the campaign as proceedingtoo quickly. It recommended reducing the request for this campaign substantially. It praised NNSA and Los Alamos National Laboratory for "turning around" thiscampaign, but urged NNSA to reduce costs. It stated that the current plan would"aggressively pursue a multi-billion dollar Modern Pit Facility before the firstproduction pit has even been successfully certified for use in the stockpile" andrecommended "a less aggressive planning approach" to MPF. The SenateAppropriations Committee recommended the amount requested for this campaign. The Feinstein amendment ( S.Amdt. 1655 ) discussed under DSW, whichwas tabled, would have barred use of funds for MPF site selection. Confereesprovided the full amount requested for manufacturing and certifying the W88 pit, butreduced MPF funding from $22.8 million to $10.8 million: "The conferees agree withthe House Report that until the Congress reviews the revised future Stockpile planit is premature to pursue further decisions regarding the Modern Pit Facility."

The FY2005 request (with FY2004 funding in parentheses) includes $132.0 million ($125.0 million) for W88 pit manufacturing, $101.5 million ($108.6 million)for W88 pit certification, $21.0 ($10.0 million) for pit manufacturing capability,$29.8 million ($10.8 million) for MPF, and $52.2 million ($42.4 million) for pitcampaign support activities at Nevada Test Site.

The House Appropriations Committee raised concerns about proceeding with MPF until the need for that facility is validated. It "will consider a modern pitfacility design only when the [accelerated] pit aging experiments are completed andthe future MPF requirements as a function of the 2012 stockpile and the expandedTA-55 production capability are determined." (TA-55 is the facility at Los Alamosused for making pits.) In contrast, it favored accelerating efforts to expand capabilityat TA-55 as a near-term hedge. Accordingly, the committee commended LosAlamos's work to restore pit manufacturing capability at TA-55, adding $10.0million to W88 pit manufacturing to accelerate this work, and eliminated the $29.8million requested for MPF. It provided the amount requested for W88 pitcertification and for pit campaign support activities at Nevada Test Site. Iteliminated the $21.0 million requested for pit manufacturing capability on groundsthat "work on pit manufacturing should be focused on expansion of the pitproduction capability of TA-55." The omnibus bill provided the requested amountsfor W88 pit manufacturing and pit campaign support activities at NTS. It cut W88pit certification to $61.0 million and pit manufacturing capability to $13.5 million. Further, it reduced MPF to $7.0 million: "The conferees agree that funding forModern Pit Facility cannot be used to select a construction site in fiscal year 2005."

Other Campaigns. The House Appropriations Committee acted on numerous other campaigns, as presented in its report on FY2005 energy andwater appropriations. Provisions in the omnibus bill are noted here as well.

The Primary Assessment Technologies Campaign, a Science Campaign, seeks to develop the ability to certify the safety and performance of agedor rebuilt primaries without nuclear testing. (11) Partof the campaign is to enhance testreadiness, or to reduce the time needed to conduct a nuclear test following apresidential order to test. The request was $81.5 million; the House reduced thatfigure to $66.5 million, as discussed in more detail under "Nuclear Testing and TestReadiness," below. The omnibus bill provided $74.0 million. The conference reportstated, "Within Primary Assessment Technologies, NNSA is directed to fund theNevada Test Site [NTS] to maintain the critical personnel skills and institutionalviability in direct support of the subcritical experimentprogram."

The House reduced the Nuclear Survivability Campaign, an Engineering Campaign, by $15.0 million, leaving $9.5 million. The HouseAppropriations Committee questioned its "high level of funding," given that itspurpose is "to assess the ability of weapons in the stockpile to continue to functionas designed during a massive nuclear exchange. In the post-Cold War world ... thisactivity is a waste of scarce resources." The omnibus conference report also provided$9.5 million.

The National Ignition Facility (NIF) is part of the Inertial Confinement Fusion and High Yield Campaign. NIF is to be the world's largestlaser. It is under construction at Lawrence Livermore National Laboratory. TheHouse provided the amount requested for NIF construction, $130.0 million. TheHouse Appropriations Committee expressed concern that NNSA's commitment toNIF seemed uncertain because NNSA had delayed the date for ignition from 2010 to2014. Accordingly, the committee directed that no funds be spent on NIF to addcapabilities not in the project's baseline until ignition is attempted in 2010. Theomnibus conference report also provided $130.0 million for NIFconstruction.

The House reduced funding for the Advanced Simulation and Computing Campaign from $741.3 million to $666.3 million. The HouseAppropriations Committee stated that it wanted to work with NNSA to developprogram products and milestones so that progress would be "transparent." TheHouse defeated an amendment by Representative Sanders that would have transferred$30.0 million from this campaign to renewable energy R&D. The omnibus billprovided $703.8 million, halfway between the request and the Houseposition.

Readiness in Technical Base and Facilities (RTBF). This program provides infrastructure and operationsat the nuclear weapons complex sites. It has six subprograms. By far the largest isOperations of Facilities ($1,021.7 million adjusted appropriation for FY2004,$1,017.6 million requested for FY2005). Others include Program Readiness, whichsupports activities occurring at multiple sites or in multiple programs ($115.8 millionadjusted appropriation for FY2004, $106.2 million requested for FY2005), andMaterial Recycle and Recovery, which recovers plutonium, enriched uranium, andtritium from weapons production and disassembly ($75.7 million adjustedappropriation for FY2004, $87.0 requested for FY2005). Construction is a separatecategory within RTBF; the adjusted appropriation for FY2004 was $258.9 million,and the FY2005 request is $206.3 million.

For FY2004, the House Appropriations Committee recommended a reduction of $102.4 million from the request. Details include $997.8 million for Operationsof Facilities, with an increase of $20.0 million for Pantex Plant (TX) and $5.0 millionfor Y-12 Plant (TN); $106.2 million for Program Readiness, reflecting theelimination of funds for Enhanced Test Readiness (discussed below); $76.2 million,as requested, for Material Recycle and Recovery; and $178.9 million forconstruction, with almost all the reduction resulting from eliminating funds requestedfor three projects ($20.0 million, exterior communications infrastructuremodernization, Sandia National Laboratories; $50.0 million, national securitysciences building, and $20.5 million, chemistry and metallurgy facility replacementproject, both at Los Alamos National Laboratory).

The Senate Appropriations Committee recommended adding $118.1 million to RTBF for FY2004. Of the increase, $117.0 million went to Operations of Facilities,including $25.0 million for the National Center for Combating Terrorism, $10.0million for Pantex Plant, $10.0 million for Y-12 Plant, $20.0 million for Kansas CityPlant (MO), $15.0 million for Lawrence Livermore National Laboratory, $20.0million for Los Alamos National Laboratory, and $8.0 million for Sandia NationalLaboratories.

Conferees provided $1,664.2 million for RTBF for FY2004, an increase of $50.8 million over the request. The main items of difference between the conferencebill and the request were Operations of Facilities (a $30.0 million increase), SpecialProjects (an increase of $8.7 million), and Chemistry and Metallurgy FacilityReplacement Project, Los Alamos National Laboratory (a $10.5 million decrease). The increase in funding for Operations of Facilities was distributed as follows: $5.0million apiece to Pantex Plant, Y-12 Plant, Kansas City Plant, and Nevada Test Site,and $10.0 million to Los Alamos.

For FY2005, the House provided $1,652.5 million for RTBF, an increase of $178.0 million. Of the RTBF components, the House increased Operations ofFacilities by $134.0 million, with all but $4.0 million of that going to maintenanceof production facilities at Pantex Plant, Kansas City Plant, and Y-12 Plant. Itreduced Program Readiness by $5.0 million, to $101.2 million; provided therequested amount, $87.0 million, for Material Recycle and Recovery; and increasedConstruction from $206.3 million to $260.3 million. The omnibus bill provided$1,670.4 for RTBF. Most components were funded at the requested level; the twolargest increases were for Operation of Facilities ($1,017.6 million requested,$1,121.6 million provided) and Highly Enriched Uranium Facility at Y-12 Plant($64.0 million requested, $114.0 million provided).

Other Programs. Weapons Activities includes four smaller programs in addition to DSW, Campaigns, and RTBF.

Secure Transportation Asset provides for the transport of nuclear weapons, components, and materials safely and securely. It includes specialvehicles used for this purpose, communications and other supporting infrastructure,and threat response. The FY2004 adjusted appropriation was $113.5 million. TheFY2005 request is $201.3 million; the House and the omnibus bill provided thatamount.

Nuclear Weapons Incident Response provides for use of DOE assets to manage and respond to a nuclear or radiological emergency within DOE, inthe United States, or abroad. Formerly a part of RTBF, it is a separate item in theFY2005 budget. The FY2004 adjusted appropriation was $89.2 million. TheFY2005 request is $99.2 million; the House and the omnibus bill provided thatamount.

Facilities and Infrastructure Recapitalization Program provides for deferred maintenance and infrastructure improvements for the nuclear weaponscomplex. In contrast, RTBF "ensure[s] that facilities necessary for immediateprogrammatic workload activities are maintained sufficiently," according to NNSA. The FY2004 adjusted appropriation was $238.8 million. The FY2005 request is$316.2 million; the House and the omnibus bill provided $273.5million.

Safeguards and Security provides operations and maintenance funds for physical and cyber security, and related construction, to protect NNSApersonnel and assets from terrorist and other threats. The FY2004 adjustedappropriation was $553.5 million. The FY2005 request is $707.0 million; the Houseprovided $741.0 million and the omnibus bill provided $757.7million.

Nuclear Testing and Test Readiness. A key issue is whether the United States can continue to maintain its weaponsthrough the Stockpile Stewardship Program without nuclear testing. While thatprogram has sought to do so, statements in early 2002 implied a reduced commitmentto that approach. Secretary of Defense Donald Rumsfeld reportedly said that nationswith nuclear weapons have "a responsibility to see that they are safe and reliable. Tothe extent that can be done without testing, clearly that is the preference. And thatis why the President has concluded that, thus far, that is the case." (12) J. D. Crouch,Assistant Secretary of Defense for International Security Policy, stated that there is"no change in the Administration's policy at this point on nuclear testing. Wecontinue to oppose CTBT [Comprehensive Test Ban Treaty] ratification. We alsocontinue to adhere to a testing moratorium." (13)

Of particular interest is readiness to conduct a nuclear test. Since FY1996, U.S. policy has been that NNSA (or DOE prior to NNSA's establishment) should be readyto conduct a nuclear test within 24 to 36 months from the time the order is given. Several studies identified work needed to reduce this time to 18 months. Thesestudies were funded by "Enhanced Test Readiness." The FY2004 budget documentstated, "The DOD and the NNSA agreed to transition to an 18-month test readinessposture while continuing to review the optimum posture. The actions necessary formoving toward an 18-month posture are expected to begin upon completion of thefinal FY 2003 appropriation." The Senate Armed Services Committee's bill forFY2004 national defense authorizations, S. 1050 , section 3132, requiredan 18-month posture unless the Secretary of Energy determined that a differentposture was preferable. NNSA, however, prepared a study in April 2003 thatconcluded that an 18-month posture was preferable. (14) Meanwhile, through FY2003,funds in the "Nevada Site Readiness" account maintained the 24- to 36-monthposture with ongoing work at the Nevada Test Site. Because no policy decision hadbeen reached on reducing the time needed to test, the Enhanced Test Readiness andNevada Site Readiness accounts had to be kept separated. With the move to an18-month test readiness posture, the enhanced posture was expected to become thecurrent posture, which would have made this separation unnecessary. Accordingly,the two accounts were expected to be merged into "Test Readiness" beginning inFY2004, depending on congressional language, though the FY2004 NNSA budgetrequest level did not reflect that merger.

The FY2003 appropriation for enhanced test readiness was $15.0 million. Conferees on the Consolidated Appropriations Resolution for FY2003 directed DOEto notify the Appropriations Committees before obligating any of these funds inFY2003 ( H.Rept. 108-10 ). The FY2004 request for Test Readiness was $24.9million, and for Nevada Site Readiness was $39.6 million.

In its FY2004 report, the House Appropriations Committee sharply criticized the plan for enhanced test readiness and recommended eliminating FY2004 funds forit. The committee expressed its concern over an "open-ended commitment" toenhanced test readiness "without any budget analysis or program plan to evaluate theefficiency or effectiveness of this funding increase," argued that the proposal "doesnot address the fundamental difficulties in maintaining test readiness during a testingmoratorium," and noted that it took 18-24 months to conduct a fully-instrumentedtest during the era of routine testing so that a proposal to maintain indefinitely an18-month posture during the testing moratorium "reflects a disturbing 'cost is noobject' perspective." Finally, even though NNSA and DOD decided to move to an18-month test readiness posture, "The Committee does not recognize the NNSAdeclaring a revised test readiness posture as a new requirement nor is it convincedthat the decision can be successfully implemented based on the planning informationprovided to date" ( H.Rept. 108-212 ). The Senate Appropriations Committee madeno reference to nuclear test readiness, and provided the amount requested forProgram Readiness, the component of RTBF containing test readiness funds. TheFeinstein amendment ( S.Amdt. 1655 ) discussed under DSW, which wastabled, would have barred use of funds provided by H.R. 2754 formodifying the test readiness posture to a posture of less than 24 months. Confereesprovided $24.9 million for test readiness, as requested, on grounds that test readinesshad atrophied. "However, the conferees expect the NNSA to focus on restoring arigorous test readiness program that is capable of meeting the current 24-monthrequirement before requesting significant additional funds to pursue a moreaggressive goal of an 18-month readiness posture" ( H.Rept. 108-357 ).

Test Readiness had been in RTBF through FY2004, but was transferred to the Science Campaign in the FY2005 budget. (With the transfer, the name "TestReadiness" was dropped; the NNSA request refers to the program as "efforts relatedto maintaining the readiness of the Nevada Test Site to conduct underground nucleartests, if directed.") Funds for test readiness are contained in the Primary AssessmentTechnologies campaign. The FY2005 request for that campaign is $81.5 million, afigure that the House reduced by $15.0 million. The House AppropriationsCommittee report stated this reduction was made

to limit the enhanced test readiness initiative to the goal of achieving a 24-month test readiness posture. The Committeecontinues to oppose the 18-month test readiness posture and refers the Department[of Energy] to the unambiguous Congressional language provided in the fiscal year2004 Conference Report requiring the Department to achieve and maintain a24-month test readiness posture.

The omnibus bill provided $74.0 million for this campaign, halfway between the House figure and the request.

Nonproliferation and National Security Programs. DOE's nonproliferation and national security programsprovide technical capabilities to support U.S. efforts to prevent, detect, and counterthe spread of nuclear weapons worldwide. These nonproliferation and nationalsecurity programs are included in the National Nuclear Security Administration.

Funding for these programs in FY2004 was $1.3198 billion. For FY2005, the Administration requested $1.3486 billion. The House bill, H.R. 4614 ,included the requested amount, but distributed the funding differently among thevarious programs. The omnibus bill, H.R. 4818 ( P.L. 108-447 ),appropriated $1.4354 billion.

In particular, the Nonproliferation and Verification R&D program, which received $232 million for FY2004, would have been funded at $220 million in theAdministration's FY2005 request, and $241.5 million in the House bill. Theomnibus bill appropriated $225.7 million. Nonproliferation and InternationalSecurity programs would have received $124 million in the request and the Housebill, compared with $110.1 million in FY2004. These programs include internationalsafeguards, export controls, and treaties and agreements. The omnibus bill fundedthem at $154 million.

International Materials Protection, Control and Accounting (MPC&A), which is concerned with reducing the threat posed by unsecured Russian weapons andweapons-usable material, would have received $238 million under the President'srequest, compared to $258.5 million appropriated for FY2004. The House bill wouldhave increased that amount to $415.3 million. The final omnibus bill appropriated$322 million. Included in the MPC&A program is the "Megaports initiative," whichis intended to install radiation detection equipment at the top 20 major overseasseaports to interdict nuclear material before it arrives in the United States. TheFY2005 request for Megaports activities was $15 million; the House bill boostedfunding to $45 million. The omnibus bill appropriated the requested $15 million.

Two programs in the former Soviet Union, Initiatives for Proliferation Prevention (IPP) and the Nuclear Cities Initiatives (NCI), have been combined intoa single program called "Russian Transition Initiative," aimed at findingnon-weapons employment for roughly 35,000 under-employed nuclear scientistsfrom the former Soviet weapons complex. The FY2005 request for the program was$41 million, compared to $40 million in FY2004, and that amount was included inthe final omnibus bill.

Table 10. DOE Defense Nuclear Nonproliferation Programs ($ millions)

*Figures do not include an across-the-board cut of 0.80%.

Requested funding for the Fissile Materials Disposition program for FY2005 was $649 million, compared with $653 million in FY2004. The program's goal isdisposal of U.S. surplus weapons plutonium by converting it into fuel for commercialpower reactors, including construction of a facility to convert the plutonium toreactor fuel at Savannah River, SC, and a similar program in Russia. The House billcut that amount to $483 million. The final omnibus bill appropriated $624 million.

(For details on these programs, see CRS Issue Brief IB10091, Nuclear Nonproliferation Issues , by [author name scrubbed].)

Environmental Management. The conference agreement on H.R. 4818 ( P.L. 108-447 ) would provide atotal of $7.51 billion in FY2005 for DOE's Environmental Management Program,subject to an across-the-board rescission of .80%. Prior to this rescission, theappropriation in the conference agreement is $80 million more than theAdministration's request of $7.43 billion, and is $440 million more than the FY2004appropriation of $7.07 billion.

The Environmental Management Program is the largest single function within DOE in terms of funding, representing approximately one third of the department'stotal budget. The primary purpose of the program is to manage radioactive andhazardous wastes, and to remediate contamination from such wastes, at former nuclear weapons sites across the country. The program also addresses wastemanagement and remediation at sites where civilian nuclear energy research wasconducted by the federal government. As such, DOE's Environmental ManagementProgram is the largest waste management and environmental cleanup programthroughout the federal government. In comparison, annual funding for the cleanupof non-radioactive contamination at Department of Defense sites has been less than$2 billion in recent years, and annual funding for the Environmental ProtectionAgency's cleanup of the nation's most hazardous private sector sites under theSuperfund program has been around $1.25 billion in recent years.

DOE's Environmental Management Program has a lengthy history with many longstanding issues. Much attention has focused on the amount of time and moneyneeded to clean up environmental contamination resulting from the production ofnuclear weapons during the Cold War. Since the beginning of the U.S. atomicenergy program in the 1940's, DOE and its predecessors have been responsible foradministering the production of nuclear weapons and managing radioactive and otherhazardous wastes. In later years, DOE expanded its efforts to include theenvironmental restoration of radioactive sites and those with other hazardouscontamination in buildings, soil, and water to ensure their safety for future uses. In1989, the first Bush Administration established the Environmental ManagementProgram within DOE to consolidate the agency's efforts in cleaning upcontamination from defense nuclear waste and civilian nuclear energy research. DOE is responsible for complying with numerous federal environmental laws andregulations in administering the current program, and is subject to fines and penaltiesfor violations of these requirements. Consequently, DOE has signed numerouslegally binding compliance agreements with the Environmental Protection Agencyand the states to perform cleanup activities and dispose of wastes according tospecific deadlines.

DOE reports that there are 114 geographic sites in 31 states and one U.S. territory where the production of nuclear weapons, and civilian nuclear energyresearch and development activities, resulted in radioactive and other hazardouscontamination. Together, these sites occupy approximately 2 million acres, whichis equivalent to the land area of Rhode Island and Delaware combined. DOE reportsthat all response actions were complete at 76 sites as of the end of FY2003, at a costof approximately $70 billion. DOE expects cleanup to be complete at 3 additionalsites by the end of FY2005. However, most of the sites that have been cleaned upthus far are relatively small and are among the least hazardous. The sites wherecleanup remains underway contain some of the most severely contaminated areas. DOE estimates that cleanup at the remaining sites will not be complete until 2035,at a cost of $142 billion. DOE had previously estimated that cleanup would not becomplete until a later date of 2070, at a higher cost of $192 billion.

DOE has substantially revised its earlier estimates of cleanup time frames and costs, as part of its cleanup reform initiative. DOE launched this initiative in FY2003and has signed letters of intent with the Environmental Protection Agency and thestates to accelerate cleanup at its major sites. DOE also has prepared PerformanceManagement Plans for many of its sites, which outline how cleanup would beaccelerated and costs reduced. According to DOE, these goals would beaccomplished by assessing the risk of exposure to determine which cleanup remediesare selected. Risk is currently one of many factors that DOE uses to select cleanupremedies. Altering the current process to use risk as the primary factor could resultin decisions to contain waste on site as a means of preventing exposure, rather thanremoving it. Whereas containment can often be accomplished more quickly and atless cost, the possibility of future exposure remains if the method of containment failsover time.

Although there has been widespread concern about the amount of time and money needed to clean up nuclear waste sites, questions have been raised as to howDOE would use a risk-based approach to accomplish its goals of faster and lesscostly cleanups without weakening environmental protection. Some have drawnattention to the possibility that more contamination may be left on site, rather thanremoved. Because of the substantial amount of time required for certain types ofradioactivity to decay, arguments have been raised that contamination left in placemay migrate in unexpected ways over the long-term, and result in pathways ofexposure that could not have been predicted when the remedy was originally selected. Others counter that completely removing radioactive contamination from all sites topermit unrestricted future land use, and eliminate all future pathways of exposure,would not be economically feasible, and in some cases would be beyond thecapabilities of current cleanup technologies.

DOE's cleanup reform initiative would continue in FY2005, with funding provided under five accounts. These accounts include two for Site AccelerationCompletion, one for Defense and one for Non-defense, which fund efforts tocomplete cleanup and close contaminated facilities at a faster pace than previouslyscheduled. There also are two Environmental Services accounts, one for Defense andone for Non-defense as well, which fund activities that indirectly support the missionof accelerated cleanup and closure, such as policy development and coordination, andthe integration of mission activities across the complex of sites. A fifth account forthe Uranium Enrichment Decontamination and Decommissioning Fund supports thecleanup of uranium enrichment plants and uranium and thorium processing sites, which previously had been included in an account entitled Uranium FacilitiesMaintenance and Remediation.

Defense sites have traditionally received the vast majority of funding under the Environmental Management Program. Of the $7.51 billion appropriation for theprogram in omnibus H.R. 4818 ( P.L. 108-447 ), $6.10 billion would beallocated to the Defense Site Acceleration Completion Account, and $938 millionwould be allocated to the Defense Environmental Services Account. TheNon-defense Site Acceleration Completion Account would receive $152 million, andthe Non-defense Environmental Services Account would receive $291 million. TheUranium Enrichment Decontamination and Decommissioning Fund would receive$499 million. Although the total appropriation for these five accounts would be$7.98 billion, this amount is offset by $463 million in federal contribution to theUranium fund, which yields a total amount of $7.51 billion for the EnvironmentalManagement Program in FY2005, subject to an across-the-board rescission of .80%as noted above.

The most controversial issue regarding funding for the Environmental Management Program in FY2005 was DOE's "High-level Waste Proposal," forwhich the President's budget proposed to set aside $350 million out of the DefenseSite Acceleration Completion Account. Under this proposal, DOE would speed theclosure of tanks storing high-level radioactive and other chemical wastes at theHanford site in Washington state, the Savannah River site in South Carolina, and theIdaho National Engineering and Environmental Laboratory (INEEL). The volumeof these wastes is substantial. For example, DOE reports that at the Hanford site thereare over 50 million gallons of high-level radioactive and chemical wastes storedbeneath the surface in 177 tanks. The tank wastes at Hanford, and the other two sites,that are classified as "high-level" radioactive wastes must be removed and safelystored in a centralized geologic repository, as required by the Nuclear Waste PolicyAct (NWPA). For more information, see CRS Report RL32163(pdf) , Radioactive WasteStreams: An Overview of Waste Classification for Disposal , by [author name scrubbed].

DOE has proposed to speed the closure of the tanks at these three sites by classifying some of the waste as "incidental to reprocessing," and to dispose of it aslow-level waste by mixing and immobilizing it with a cement "grout" inside the tank. DOE issued this proposal under an internal agency "order" (Order 435.1). (15) SomeMembers of Congress, states, environmental organizations, and communities opposed DOE's proposal, arguing that none of the tank wastes should be allowed toremain in place because of the possibility that the grout might not mix thoroughlywith the waste to contain it safely and prevent leaks. However, others asserted thatmethods to remove all of the tank residues would generate a new hazardous wastestream that would need to be managed properly to prevent exposure. There alsocould be significant risks of exposure to workers who would remove the residues.

Thus far, DOE has grouted high-level radioactive wastes in two tanks at the Savannah River site. The Natural Resources Defense Council (NRDC) legallychallenged DOE's authority to dispose of these wastes in this manner. In 2003, theU.S. District Court for Idaho ruled that DOE does not have the authority to classifythe tank wastes at the Savannah River site, or any other site, as anything other thanhigh-level radioactive waste. (16) Consequently,these wastes would have to beremoved and disposed of in a centralized geologic repository as required by theNWPA.

DOE appealed the 2003 ruling, and on November 5, 2004, the U.S. Court of Appeals for the Ninth Circuit reversed the above district court opinion, ruling that thechallenge to Order 435.1 was not "ripe" for review. (17) The court found that thedistrict court decision predated DOE application of Order 435.1 to a particularsituation, and, thus, there was no present conflict with the NWPA. (18) The courtdetermined that while it was possible that DOE might violate the NWPA at somepoint, it might just as likely comply with all applicable law. (19) Thus, under the termsof the circuit court opinion, DOE may engage in activities pursuant to Order 435.1,and NRDC or others then would be free to bring suit if they believe those activitiesviolate the law.

Prior to the appeals court ruling, the Secretary of Energy asked Congress to enact legislation that would provide DOE with statutory authority to classify someof the tank wastes as incidental to reprocessing at Hanford, Savannah River, and theINEEL, thereby exempting them from disposal requirements for high-levelradioactive waste in the NWPA. Whether the wastes could be left in the tanks andgrouted in place would ultimately depend on the concurrence of state regulatoryagencies who issue the permits for tank closures.

Congress included authority in the Ronald W. Reagan National Defense Authorization Act for FY2005 ( P.L. 108-375 ) for DOE to grout some of the tankwastes at Savannah River and the INEEL. However, the authority was not extendedto Hanford, where most of the leaking tanks are located. As noted above, DOE stillmay pursue the grouting of tanks at Hanford under Order 435.1, but could be subjectto legal challenge at that site. (For further discussion, see CRS Report RS21988 , Radioactive Tank Wastes: Disposal Authority in the Ronald W. Reagan NationalDefense Authorization Act for FY2005 , coordinated by David Bearden.)

From the appropriation for the Defense Site Acceleration Completion Account, H.R. 4818 ( P.L. 108-447 ) would provide $292 million of the $350million that the Administration requested for its High-level Waste Proposal. Of the$292 million, $163 million would be allocated to the Savannah River site in SouthCarolina for projects to prepare for the grouting of tank wastes, and $97 millionwould be allocated to the INEEL in Idaho for such projects. The remainingappropriation of $32 million would be allocated to Hanford in Washington state. However, it appears questionable whether this appropriation for Hanford would besufficient legal authority to permit the grouting of tank wastes at that site, as thewaste disposal authority in P.L. 108-375 does not include Washington state.

There are differing court rulings regarding whether an appropriation of funding by Congress for a specific activity alone provides sufficient authority for an agencyto carry out that activity, absent authority provided in other statutes or in apparentcontradiction of pre-existing authority. In short, Congress can effectively validateotherwise unauthorized or unlawful action in an appropriations act by clearlyindicating that it intends to alter or repeal pre-existing law, in addition to funding anactivity. Whether an appropriation for a specific activity constitutes an authorizationmay be subject to some argument and possible legal challenge, unless Congressexplicitly addresses the authority in question. (20) The conference report languageallocating an appropriation of $32 million for "waste incidental to reprocessing"activities at the Hanford site in FY2005 does not expressly mention the grouting oftank wastes, raising the question of the authority for the use of this disposal methodat that site.

In addition to the issue of how to dispose of radioactive tank wastes, there also has been ongoing concern in Congress about the feasibility of DOE's overall plansto accelerate cleanup and lower costs at the 114 sites across the country that make upthe former defense nuclear weapons complex. Prior to the conference agreement on H.R. 4818 ( P.L. 108-447 ), the House Appropriations Committee notedin its report on H.R. 4614 ( H.Rept. 108-554 ) that recent delays incleanup schedules and cost overruns of certain projects raise questions regardingDOE's ability to accelerate cleanup. The committee also raised concerns regardingDOE's delay in submitting a report to Congress on statutory changes that may benecessary to allow accelerated cleanup to proceed, and the need for agreements withthe states on all elements of the Performance Management Plans for each site. Theseplans outline how accelerated cleanup would be accomplished.

In addition to funding for the Environmental Management Program, the conference agreement on H.R. 4818 ( P.L. 108-447 ) would appropriate$78 million for DOE's Office of Legacy Management. The Administration hadrequested $66 million, the same as the FY2004 appropriation. Of the amount in H.R.4818 ( P.L. 108-447 ), $47 million would be allocated to defense sites, andthe remaining $31 million to non-defense sites. Congress provided the funding forDOE to establish this office in the Energy and Water Development AppropriationsAct for FY2004 ( P.L. 108-137 ). The primary function of the office is to assesslong-term stewardship needs once cleanup is complete, to ensure that DOE's cleanupactions continue to be effective in the future. These planning assumptions arecurrently based on a time frame of 150 years. DOE previously administered theseresponsibilities under multiple elements of its Environmental Management program.

Civilian Nuclear Waste. Considerable controversy erupted over the Bush Administration's FY2005 budgetrequest for the DOE civilian nuclear waste disposal program. Although theprogram's proposed budget totaled $880 million -- a 50% boost over FY2004 -- theAdministration also proposed that $749 million be offset by revenue from theexisting nuclear waste fee, so that the net appropriation would be only $131 million.

The House Appropriations Committee, noting that Congress had not enacted the Administration's waste-fee offset proposal, voted to provide only the $131 millionnet appropriation request rather than cut other programs to make up the difference. The controversy contributed to a decision by the Senate Appropriations Committee'sEnergy and Water Development Subcommittee against holding a markup on theFY2005 funding bill. At one point, it appeared that the Energy and Water bill wouldbe left out of the omnibus spending bill, but a compromise was ultimately reachedto give the DOE waste program $577.0 million, the same as the FY2004 fundinglevel.

The Administration's proposed spending increase was intended primarily to pay for designing a national nuclear waste repository at Yucca Mountain, Nevada, andfor developing a national waste transportation program. DOE contends that fundingfor the waste program, run by the Office of Civilian Radioactive Waste Management(OCRWM), must average $1.3 billion per year between FY2005 and FY2010 to meetthe current 2010 target date for shipping nuclear waste to Yucca Mountain. Thattarget date was largely dependent on DOE's plans to submit a repository licenseapplication to the Nuclear Regulatory Commission by the end of 2004 -- which DOErecently announced would be delayed until 2005.

In addition to the $880 million request for the civilian waste disposal program, the Administration had planned in FY2005 to transfer responsibility for DOE-ownedspent fuel to a new Office of DOE Spent Fuel Management, which would report tothe OCRWM Director. The $22.5 million request for the new office brought the totalFY2005 request for OCRWM to $907.5 million. However, the conference report didnot include the proposed transfer.

The Nuclear Waste Policy Act of 1982 (NWPA, P.L. 97-425 ), as amended, names Yucca Mountain as the sole candidate site for a national geologic repository. Congress passed an approval resolution in July 2000 ( H.J.Res. 87 , P.L.107-200 ) that authorized the Yucca Mountain project to proceed to the licensingphase.

FY2005 funding in the conference report for the Office of Civilian Radioactive Waste Management comes from two appropriations accounts. First, $346.0 millionis appropriated from the Nuclear Waste Fund, which consists of fees paid by nuclearutilities. Second, $231.0 million would be appropriated from general revenues underthe Defense Nuclear Waste Disposal account, which pays for disposing of high-levelwaste from the nuclear weapons program in the planned civilian repository.

The House Appropriations Committee excoriated the Administration for requesting a net appropriation of only $131 million and for assuming that Congresswould enact the waste-fee offset proposal in time. "At best, the Office ofManagement and Budget (OMB) made an unwise budget calculation to assume thisoffset," said the committee report. "At worst, OMB took a foolish political gambleby assuming that reclassification legislation would be enacted this year."

The House panel warned in its report that the funding cutback would have "far-reaching" consequences for the nuclear waste program, but that there was nofunding available under the budget request to shift from other programs. TheCommittee report noted DOE's prediction that the funding reduction could forcelayoffs of 70% of the program's work force, place submittal of the repository licenseapplication "at risk," and cause "an indefinite delay in opening the repository."

On the same day the House Appropriations Committee approved the energy and water bill, the Subcommittee on Energy and Air Quality of the House Energy andCommerce Committee approved a bill ( H.R. 3891 ) to enact theAdministration's nuclear waste fee reclassification proposal. However, the use ofwaste fees to offset appropriations for the repository program would be limited to thenext five years. No Senate action has been taken on the proposal.

The 2010 target for opening a permanent repository is 12 years later than the Nuclear Waste Policy Act deadline of January 31, 1998, for DOE to begin takingwaste from nuclear plant sites. Nuclear utilities and state utility regulators, upsetover DOE's failure to meet the 1998 disposal deadline, have won two federal courtdecisions upholding the department's obligation to meet the deadline and tocompensate utilities for any resulting damages. Utilities have also won several casesin the U.S. Court of Federal Claims. The nation's largest nuclear utility, ExelonCorporation, reached a breach-of-contract settlement with the federal government inAugust 2004 that may total $600 million if DOE does not begin taking spent fuelbefore 2015.

Further delays in the Yucca Mountain program could result from a July 2004 court decision that overturned a key aspect of the Environmental Protection Agency's(EPA's) regulations for the repository. A three-judge panel of the U.S. Court ofAppeals for the District of Columbia Circuit ruled that EPA's 10,000-yearcompliance period was too short, but it rejected several other challenges to thestandards. (For more information, see CRS Issue Brief IB92059, Civilian NuclearWaste Disposal , by [author name scrubbed].)

Power Marketing Administrations. DOE's four Power Marketing Administrations (PMAs) developed during the 1930sout of the construction of dams and multi-purpose water projects that are operatedby the Bureau of Reclamation and the Army Corps of Engineers. The originalintention behind many of these projects was conservation and management of waterresources, including irrigation, flood control, recreation, and other objectives. However, many of these facilities generated electricity for project needs. The PMAswere established to market the excess power; they are the Bonneville PowerAdministration (BPA), Southeastern Power Administration (SEPA), SouthwesternPower Administration (SWPA), and Western Area Power Administration (WAPA).

The power is sold at wholesale to electric utilities and federal agencies "at the lowest possible rates ... consistent with sound business practice," and priority onPMA power is extended to "preference customers," which include municipal utilities,co-ops and other "public" bodies. The PMAs do not own the generating facilities,but they generally do own transmission facilities, except for Southeastern. ThePMAs are responsible for covering their expenses and repaying debt and the federalinvestment in the generating facilities.

The 104th Congress debated sale of the PMAs and did, in 1995, authorize divestiture of one PMA (the Alaska Power Administration Act, P.L. 104-58 ). Therehas been no press to dispose of the remaining PMAs, and none seems likely given thebroader uncertainties governing electric utility restructuring.

Congress enacted a funding level of $213.0 million in FY2004, less $22 million in Colorado River Basin revenues. The FY2005 request is $210.5, less $23 millionin Colorado River revenues, reflecting a reduction of $3.8 million for WAPA, andslight increases for the three other PMAs. The House bill included the same level offunding, as does the omnibus bill (less the 0.80% rescission).

BPA receives no annual appropriation, but funds some of its activities from permanent borrowing authority, which was increased in FY2003 from $3.75 billionto $4.45 billion (a $700 million increase). BPA is not requesting additionalborrowing authority in FY2005. BPA intends to use $487 million of its borrowingauthority in FY2004, down from $528 in FY2004, to be used for generation andtransmission services, conservation, energy efficiency, fish and wildlife, and capitalequipment programs.

Title IV: Independent Agencies

Independent agencies that receive funding from the Energy and WaterDevelopment bill include the Nuclear Regulatory Commission (NRC), the Appalachian Regional Commission (ARC), and the Denali Commission.

Table 11. Energy and Water Development Appropriations Title IV: Independent Agencies ($ millions)

Source: President's budget request for FY2005, H.Rept. 108-554 and H.Rept. 108-792 .

a. Does not include the modified rescission amount of .80% in H.Con.Res. 528 .

Key Policy Issues -- Independent Agencies

Nuclear Regulatory Commission. The Nuclear Regulatory Commission (NRC) requested a total budget of $670.3million for FY2005, including $7.5 million for the NRC inspector general's office. The request is about 7% above the FY2004 funding level. Major activities conductedby NRC include safety regulation and licensing of commercial nuclear reactors,licensing of nuclear waste facilities, and oversight of nuclear materials users. Theomnibus conference report provides the full request, as did the House-passed energyand water bill.

NRC proposed to spend $39.7 million -- an 18% increase -- on licensing activities for possible new commercial reactors, which are being encouraged byDOE's Nuclear Power 2010 program. According to the NRC budget justification,the funding will be used for early site permits (sites approved for future reactors),reactor pre-licensing and licensing reviews, and certification of new reactor designs.

The House Appropriations Committee had approved bill language prohibiting NRC from issuing a license during FY2005 for construction or operation of a newcommercial nuclear power plant. The committee report contended: "For the NuclearRegulatory Commission to license any new reactors without a certain disposal pathfor the spent nuclear fuel would be unjustifiable and irresponsible." However, theconference report and the House-passed bill do not include the licensing restriction.

In the wake of the September 11, 2001, terrorist attacks against the United States, NRC has focused additional attention on the security of nuclear power plantsand other users of radioactive material. NRC's FY2005 budget request included$56.8 million for activities related to homeland security, a 10% increase overFY2004. In FY2005, NRC intends to continue conducting force-on-force securityexercises and require nuclear plants to revise their security plans to reflect increasedbaseline threats. (For more information on protecting licensed nuclear facilities, see CRS Report RS21131 , Nuclear Power Plants: Vulnerability to Terrorist Attack , by[author name scrubbed].)

To begin reviewing an anticipated DOE license application for a national nuclear waste repository at Yucca Mountain, Nevada, the NRC budget for high-levelwaste regulation would more than double from FY2004. The $69.1 million requestalso includes safety testing of full-scale casks for transporting nuclear waste by railand by truck.

For the decade before FY2001, NRC's budget was offset 100% by fees on nuclear power plants and payments by other licensed activities, such as the DOEnuclear waste program. The nuclear power industry had long contended that the feestructure required nuclear reactor owners to pay for a number of NRC programs, suchas foreign nuclear safety efforts, from which they did not directly benefit. To accountfor that concern, the FY2001 Energy and Water Development Appropriations Act( P.L. 106-377 ) included an NRC proposal to phase down the agency's fee recoveryto 90% during the subsequent five years -- two percentage points per year. Therefore, 90% of the FY2005 NRC budget is to be offset by fees on licensees. Because $69.1 million is to be appropriated from the Nuclear Waste Fund to pay forwaste repository licensing, the 90% fee requirement applies to $601.2 million of thebudget, leaving a net appropriation of $60.1 million. With the Nuclear Waste Fundappropriation, NRC's total net appropriation in the conference report is $129.2million.

For Additional Reading

CRS Issue Briefs

CRS Issue Brief IB10041. Renewable Energy: Tax Credit, Budget, and Electricity Production Issues, by [author name scrubbed].

CRS Issue Brief IB92059. Civilian Nuclear Waste Disposal, by [author name scrubbed].

CRS Issue Brief IB10091. Nuclear Nonproliferation Issues, by Carl Behrens.

CRS Issue Brief IB10120. Army Corps of Engineers Civil Works Program: Issues for Congress, by [author name scrubbed] and [author name scrubbed].

CRS Issue Brief IB88090. Nuclear Energy Policy , by [author name scrubbed] and Carl Behrens.

CRS Reports

CRS Report RS20702 . South Florida Ecosystem Restoration and the Comprehensive Everglades Restoration Plan, by [author name scrubbed] and [author name scrubbed].

CRS Report RL30928. Army Corps of Engineers: Reform Issues for the 107th Congress, by [author name scrubbed].

CRS Report RS20569 . Water Resource Issues in the 107th Congress, by Betsy A.Cody and [author name scrubbed].

CRS Report RS20866 . The Civil Works Program of the Army Corps of Engineers: A Primer, by [author name scrubbed] and [author name scrubbed].

CRS Report RL31116 . Water Infrastructure Funding: Review and Analysis of Current Issues, by [author name scrubbed] and [author name scrubbed].

CRS Report RL30478 . Federally Supported Water Supply and Wastewater Treatment Programs, by the Resources, Science and Industry Division.

CRS Report RL32189 . Terrorism and Security Issues Facing the Water Infrastructure Sector, by [author name scrubbed] and [author name scrubbed].

CRS Report RL31098(pdf) . Klamath River Basin Issues: An Overview of Water Use Conflicts, coordinated by [author name scrubbed].

CRS Report RL30928. Army Corps of Engineers: Reform Issues for the 107th Congress , by [author name scrubbed].

CRS Report RL32131 , Phosphorus Mitigation in the Everglades , by [author name scrubbed] and Barbara Johnson.

CRS Report RL31975 , CALFED Bay-Delta Program: Overview of Institutional and Water Use Issues , by [author name scrubbed] and Pervaze Sheikh.

CRS Report RL32130 , Nuclear Weapon Initiatives: Low-Yield R&D, Advanced Concepts, Earth Penetrators, Test Readiness, by Jonathan Medalia.

CRS Report RL32347 , Robust Nuclear Earth Penetrator Budget Request and Plan, FY2005-FY2009, by Jonathan Medalia.

CRS Report RL31993 , Nuclear Warhead 'Pit' Production: Background and Issues for Congress, by Jonathan Medalia.

CRS Report RL32163(pdf) , Radioactive Waste Streams: An Overview of Waste Classification for Disposal , by [author name scrubbed].

CRS Report RS21131 , Nuclear Power Plants: Vulnerability to Terrorist Attack , by [author name scrubbed].