On November 12, the House, and on November 13, the Senate, approved a conferenceagreement on the FY2003 defense authorization bill ( H.R. 4546 ), and the Presidentsigned the bill into law on December 2 ( P.L. 107-314 ). Earlier, on October 10, the House, and onOctober 16, the Senate, approved a conference agreement on the FY2003 defense appropriationsbill ( H.R. 5010 ), and the President signed it into law on October 23 ( P.L. 107-248 ). The conference agreement on the defense appropriations bill provides $355.1 billion for programsit covers. This is $11.7 billion below the Administration's request. The bill does not include $10billion that the Administration requested as a contingency fund for costs of counter-terrorismoperations in FY2003. FY2003 Defense Authorization Bills. On May1, the House Armed Services Committee marked up its version of the FY2003 defense authorizationbill, H.R. 4546 . The committee also considered, but did not report, a companionmeasure, H.R. 4547 , to provide funds for the war on terrorism. The House passed H.R. 4546 early on the morning of May 10. On May 9, the Senate Armed ServicesCommittee completed marking up its version of the FY2003 defense authorization, S. 2514 , and a report was issued on May 15. On June 13, the committee approved an amendment tobe offered on the floor regarding the Crusader artillery system. On June 18, the full Senate beganconsidering the bill, and the Senate passed the bill on June 27. On July 18, the House ArmedServices Committee reported H.R. 4547 , entitled the Cost of War Against TerrorismAuthorization Act (COWATAA), and the full House approved the bill under suspension of the ruleson July 24. On November 12, a conference report on the bill was filed. The conference agreementwas approved in the House under suspension of the rules on November 12. The Senate approvedthe conference report on November 13 by voice vote. The President signed by bill on December 2. FY2003 Defense Appropriations Bill. On June 19, the House Defense Appropriations Subcommittee marked up its version of the FY2003 defenseappropriations bill, and on June 24, the full committee marked up the bill ( H.R. 5010 )and ordered it to be reported. The House passed the bill on June 27. On July 18, the SenateAppropriations Committee reported its version of the bill (also H.R. 5010 ). The Senatepassed the bill on August 1. On October 9, conferees announced agreement on a compromiseversion of the bill. The House approved the conference report on October 10 and the Senate onOctober 16. The President signed the bill into law on October 23. FY2003 Congressional Budget Resolution. On March 20, the House passed its version of the annual congressional budget resolution, H.Con.Res. 353 , and the Senate reported its version, S.Con.Res. 100 , onMarch 22. Both versions recommended funding levels for defense in FY2003 very close to what theAdministration requested. The full Senate never considered the resolution on the floor, however,and it the two chambers were not able to agree on a common budget. On May 22, as part of the rulegoverning debate on supplemental appropriations, the House approved a measure deeming thebudget resolution, as approved in the House, to have been passed for purposes of guiding later actionon funding legislation. FY2002 Supplemental Appropriations. On March 21, the Administration submitted a request for $27.1 billion in supplemental FY2002 appropriationsfor activities in response to last year's terrorist attacks, of which $14 billion was for defenseprograms. On May 24, the House approved its version of the bill, H.R. 4775 , providing$28.8 billion using Office of Management and Budget (OMB) scoring of a key provision (asassumed by the appropriations committee) and $30.1 billion using Congressional Budget Office(CBO) scoring. The Senate approved its version of the bill on June 7, providing $31.4 billion. OnJuly 18, conferees announced agreement on a compromise bill that provides $28.9 billion, including$14.5 billion for defense. The House approved the conference report on July 23 and the Senate onJuly 24, and the President signed the bill on August 2 ( P.L. 107-206 ). Of the total in the bill, $5.1billion was provided in contingent emergency appropriations, and on August 13, the White Houseannounced that the President would not designate those amounts as emergency funding. Withoutthose amounts, the total available for defense in the bill is $13.983 billion offset by $613 million inrescissions. Table 1a. Status of FY2003 Defense Appropriations Table 1b. Status of FY2003 DefenseAuthorization On February 4, 2002, the Administration submitted its formal FY2003 budgetrequest to Congress. The Administration proposed $396.8 billion for the nationaldefense budget function, about $46 billion above the estimated FY2002 level (for anoverview of the request, see Appendix B ). Of the total requested, $3.4 billion wasfor full accrual accounting of civilian personnel retirement benefits, which Congressultimately did not approve. Without the accrual accounting change, the request was$393.4 billion. Of this amount, $366.7 billion was requested for programs coveredby the defense appropriations bill, $9.7 billion by the military constructionappropriations bill, $16.5 billion for Department of Energy defense-related activitiesfunded in the energy and water appropriations bill, and the remainder in otherappropriations bills. With a global war against terrorism underway, Congress was not inclined to make substantial changes in the Administration's request for a defense increase. Early in the year, however, there was some skirmishing, particularly between thedefense committees and the budget committees, over two issues: first, how to treat the Administration's request for $10 billion in FY2003 in an unallocated contingency fund for the war against terrorism and, second, how to treat the Administration's request for full accrual accounting of civilian retirement benefits, which, across the wholegovernment, would increase discretionary spending by about $9 billion and reducemandatory spending by an equal amount (see Appendix B for a discussion of accrualaccounting). For their part, the congressional defense committees would have preferred to be able to allocate the entire amount the Administration requested for national defenseas they saw fit. The House Budget Committee, however, set aside the $10 billionrequested for war costs in a reserve fund available only for that purpose. The Housealso set aside funds for civilian accrual accounting in a reserve fund, while the SenateBudget Committee rejected the shift to full accrual accounting altogether. Table 2 shows amounts recommended for national defense in the House and Senate versionsof the budget resolution, compared to the Administration request. The House approved its version of the FY2003 budget resolution, H.Con.Res. 353 , on March 20 by a vote of 221-209. In all, the measurerecommended $393.8 billion for the national defense budget function in FY2003, but$10 billion of that amount was in the reserve fund available only for costs of theglobal war against terrorism. An additional $3.4 billion, not shown in the nationaldefense total, was available for defense in the reserve fund to cover costs of accrualaccounting, if Congress approved it. The Senate Budget Committee version of the resolution, S.Con.Res. 100 , was reported on March 22 but was never brought up onthe Senate floor. The committee recommended $393.4 billion for national defensein FY2003 and explicitly rejected a shift to full accrual accounting for civilianemployees. The committee also recommended lower levels of defense spending afterFY2004 than either the House or the Administration, though the committee set asidefuture funds in a reserve to be available either for defense or deficit reduction. Recommended national defense funding levels in the budget resolution are notbinding on the appropriations committees, however, which are free to allocate fundsfor discretionary programs as they decide. Table 2. Congressional Budget Resolution, Recommended Amounts for National Defense, FY2003-FY2007 (billions of dollars) Sources: H.Con.Res. 353 ; S.Con.Res. 100 . The $9 billion requested for full civilian accrual accounting was at the center of debate over the total amount available for appropriations bills. The House-passedbudget resolution provided $759 billion in total discretionary funding to theappropriations committee, which is equal to the Administration request without the$9 billion government-wide cost of shifting civilian accrual payments from themandatory to the discretionary side of the budget. The Senate reported version of thebudget resolution, however, provided $768 billion in discretionary funds, though itdid not assume that Congress would approve the shift of accrual funding. As a result,without the $9 billion for accrual accounting, the House ended up marking upappropriations bills with $9 billion less than the Senate. Eventually, this contributedto a deadlock, and none of the appropriations bills, except for defense and militaryconstruction, have been enacted. How to treat the $10 billion that the Administration requested as an unallocated contingency for war costs was a matter of ongoing discussion. On May 22, theHouse approved H.Res. 428 , the rule governing debate on the FY2002supplemental appropriations bill ( H.R. 4775 ), which includes aprovision "deeming" the budget resolution, as passed by the House, to be in effectfor purposes of subsequent House action on appropriations and other funding bills.