The House Appropriations Committee introduced its Military Construction Appropriations Billfor Fiscal Year (FY) 2004 ( H.R. 2559 , H.Rept. 108-173 ) on June 23, 2003. The Houseconsidered and passed the bill on June 26, 2003. The Senate Appropriations Committee introduced its companion bill ( S. 1357 , S.Rept. 108-82 ) on June 26. On July 10, the Senate amended H.R. 2559 by striking thetext and substituting that of S. 1357 . The Senate passed the amended bill on July 11(91-0) and requested a conference with the House. On September 16, the House disagreed with theSenate amendment (motion to do so was carried without objection) and appointed conferees. Theconference report was completed on November 4, 2003, and was passed by the House on November5 (417-5). The message on House action is being held at the desk in the Senate. In late September, the President submitted an emergency supplemental appropriations request. While the Senate considered its version of the bill ( S. 1689 ), the House passed its bill( H.R. 3289 ) on October 17, 2003 (303-125). The Senate substituted the text of S.1689 for that of H.R. 3289, passed the amended bill by unanimous consent, andsent notice of its action to the House. The conference report ( H.Rept. 108-337 ) was filed on October30. The House approved the report on October 31 (298-121, Roll No. 601), and the Senate approvedby voice vote on November 3. The bill was presented to the President on November 5. Conference action on the National Defense Authorization Act for FY2004 ( H.R. 1588 ) began on July 22 and has not yet concluded. The House voted to instruct its conferees onSeptember 10 (406-0). The Department of Defense (DOD) manages the world's largest dedicated infrastructure, covering more than 40,000 square miles of land and a physical plant worth more than $500 billion. The military construction appropriations bill provides a large part of the funding to enhance andmaintain this infrastructure. The bill funds construction projects and some of the facilitysustainment, restoration and modernization of the active Army, Navy and Marine Corps, Air Force,and their reserve components; (1) additionaldefense-wide construction; U.S. contributions to theNATO Security Investment Program (formerly known as the NATO Infrastructure Program); (2) andmilitary family housing operations and construction. The bill also provides funding for the BaseRealignment and Closure (BRAC) account, which finances most base realignment and closure costs,including construction of new facilities for transferred personnel and functions and environmentalcleanup at closing sites. (3) The military construction appropriations bill is one of several annual pieces of legislation that provide funding for national defense. Other major appropriation legislation includes the defenseappropriations bill, which provides funds for all non-construction military activities of theDepartment of Defense and constitutes more than 90% of national security-related spending, and theenergy and water development appropriations bill, which provides funding for atomic energy defenseactivities of the Department of Energy and for civil projects carried out by the U.S. Army Corps ofEngineers. Two other appropriations bills, VA-HUD-Independent Agencies andCommerce-Justice-State, also include small amounts for national defense. (4) No funds may be expended by any agency of the federal government before they are appropriated. (5) In addition, for nearly half a centuryCongress has forbidden the Department ofDefense to obligate funds for any project or program until specific authorization is granted. (6) Thisexplains why, for defense funds, both authorization and appropriations bills are required. Twoseparate defense appropriations bills are written annually, a "Military Construction AppropriationsAct" dedicated to military construction, and a "National Defense Appropriations Act" covering allother defense appropriations. (7) Normally only one"National Defense Authorization Act" is passedeach year to authorize both of these appropriations. (8) Therefore, major debates over defense policyand funding issues, including military construction, can be associated with any of these bills.Because issues in the defense authorization and appropriations bills intertwine, this report includessalient parts of the authorization bill in its discussion of the military construction appropriationprocess. The separate military construction appropriations bill dates to the late 1950s. Traditionally, military construction was funded through annual defense or supplemental appropriations bills. However, the Korean War prompted a surge of military construction, followed by a steady increasein military construction appropriations. Given the strong and enduring security threat posed by theSoviet Union, a relatively high level of spending on military infrastructure appeared likely tocontinue. The appropriations committees established military construction subcommittees andcreated a separate military construction bill. The first stand-alone military construction bill waswritten for FY1959 (P.L. 85-852). Military construction appropriations are not the sole source of funds available to defense agencies for facility investment. The defense appropriations bill funds so-called minor constructionand property maintenance within its operations and maintenance accounts. In addition, constructionand maintenance of Morale, Welfare, and Recreation-related facilities are partially funded throughproceeds of commissaries, recreation user fees, and other non-appropriated income. Several special accounts are included within the military construction appropriation. Among these are the Homeowners Assistance Fund (Defense), (9) and the Department of Defense FamilyHousing Improvement Fund, (10) both of whichperform functions ancillary to the direct building ofmilitary infrastructure. Most funds appropriated by Congress each year must be obligated in that fiscal year. Military construction appropriations, though, are an exception. Because of the long-term nature ofconstruction projects, these funds can generally be obligated for up to five fiscal years. Consideration of the military construction budget begins when the President's budget is delivered to Congress each year, usually in early February. This year, the President submitted hisFY2004 budget request to the Congress on February 3, 2003. Table 1 shows the key legislative steps necessary for the enactment of the FY2004 militaryconstruction appropriations. It will be updated as the appropriation process moves forward. Table 1. Status of Military Construction Appropriations, FY2004 Notes: Dashes indicate no action yet taken. House Appropriations Action. Following a series of hearings by the House Subcommittee on MilitaryAppropriations, the full Committee marked up its bill on June 17. H.R. 2559 ( H.Rept. 108-173 ) was introduced to the House on June 23, 2003, and placedon the Union Calendar (Calendar No. 88). The House considered the bill under theprovisions of a Special Rule ( H.Res. 298 ) on June 26, 2003( Congressional Record, H5979-5990). The measure passed by the Yeas and Nays:428-0 (Roll no. 325). The bill was received in the Senate the same day and placed on the Legislative Calendar under General Orders (Calendar No. 177). Senate Appropriations Action. The Senate Committee on Appropriations Subcommittee on Military Constructionheld hearings on its bill during March and April of 2003. The full Committeereported legislation ( S. 1357 , S.Rept. 108-82 ) to the Senate on June 26.The bill was placed on the Legislative Calendar under General Orders (Calendar No.176). On July 10, the Senate began consideration of H.R. 2559 , striking all after the enacting clause and substituting the text of S. 1357 . TheSenate passed the bill on July 11 (91-0), insisted on its amendment, and requested aconference with the House. Conference Action. On September 16, 2003, the House disagreed with the Senate amendment, agreed to a conference,and appointed conferees ( Congressional Record , H8228). By the end of their meetingon October 22, the conferees had not agreed on a final report. Difference betweenHouse and Senate managers appeared to center on allocations of funding forconstruction projects in Europe and in the Republic of Korea, where the Presidenthad requested $292 million, but where the future of many installations remains indoubt (See Realignment of Overseas Bases , below). The conferees agreed on theirbill on November 4. The House approved the report on November 5 (417-5, Roll No.606), and the message on House action is being held at the desk in the Senate. The President's original budget submission for military construction totaled $9,036,721,000. This was amended upward by the House Appropriations Committee to $9,237,096,000 because of transfers from the defense appropriations bill (11) to themilitary construction appropriations bill and calculations performed by theCongressional Budget Office (CBO) pursuant to an Administration request for ageneral provision of funding related to the "Foreign Currency Fluctuations,Construction, Defense" account. The funding transfers included $25,500,000 for thepurpose of constructing a Special Operations Forces facility and $119,815,000 forchemical demilitarization construction. The CBO calculation resulted in are-appropriation of $55 million. The Senate Appropriations Committee similarly amended the President's budget submission, including the transfer of funds for the Special Operations Forces facilityand the CBO calculation. It did not include the transfer of chemical demilitarizationconstruction funds from the defense appropriations bill, as had been done in theHouse version of the bill. (12) Therefore, the Senateversion of the budget submissionis quoted as $9,117,281,000.