Agriculture, Rural Development, Food and Drug Administration, and Related Agencies

Agriculture, Rural Development, Food and Drug Administration, and Related Agencies AG The Heritage Foundation | heritage.org/BlueprintForBalance $2.6 DISCRETIONARY SAVINGS IN MILLIONS1

Repeal the USDA Catﬁsh Inspection Program

The Food and Drug Administration regulates the health justifications for the more intrusive domestic and imported seafood, but the 2008 farm inspection program, which has engendered wide- bill created a special exception requiring the USDA spread bipartisan opposition and has been criticized to regulate catfish that is sold for human consump- repeatedly by the U.S. Government Accountabil- tion. This program, implementation of which is just ity Ofce (for example, in a 2012 report with the now beginning, would impose costly duplication not-so-subtle title Seafood Safety: Responsibility because facilities that process seafood, including for Inspecting Catfish Should Not Be Assigned to catfish, would have to comply with both FDA and USDA).2 USDA regulations. The evidence does not support

ADDITIONAL READING " Daren Bakst, “Addressing Waste, Abuse, and Extremism in USDA Programs,” Heritage Foundation Backgrounder No. 2916, May 30, 2014. " U.S. Government Accountability Ofce, Seafood Safety: Responsibility for Inspecting Catﬁsh Should Not Be Assigned to USDA, GAO-12-411, May 2012.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

70 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 AG

The Heritage Foundation | heritage.org/BlueprintForBalance $754 DISCRETIONARY SAVINGS IN MILLIONS3

Eliminate the USDA Conservation Technical Assistance Program

The USDA’s Natural Resources Conservation Ser- necessary, can seek private solutions to conserva- vice runs this costly program that ofers landowners tion challenges. technical assistance on natural resource management. This assistance includes help in maintaining Federal taxpayers should not be forced to subsidize private lands, complying with laws, enhancing advice for which landowners should be paying on recreational activities, and improving the aesthetic their own. In addition, this government interven- character of private land. Private landowners tion could be crowding out the private solutions that are the best stewards of a given property and, if should be available to private landowners.

ADDITIONAL READING " Daren Bakst, “Addressing Waste, Abuse, and Extremism in USDA Programs,” Heritage Foundation Backgrounder No. 2916, May 30, 2014.

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending by $107 million compared to FY 2019. INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 71 AG The Heritage Foundation | heritage.org/BlueprintForBalance $493 MIXED SAVINGS IN MILLIONS4

Eliminate the USDA Rural Business Cooperative Service

The RBCS maintains a wide range of financial other business must. Private capital will find its way assistance programs for rural businesses. It also has to worthy investments. a significant focus on renewable energy and global warming, including subsidies for biofuels. Rural The government should not be in the business of businesses are fully capable of running themselves, picking winners and losers when it comes to private investing, and seeking assistance through private investments or energy sources. Instead of funneling means. The fact that these businesses are in rural taxpayer dollars to businesses in rural communities, areas does not change the fact that they can and the federal government should identify and remove should succeed on their own merits, just as any the obstacles to those businesses that it has created.

ADDITIONAL READING " Daren Bakst, “Addressing Waste, Abuse, and Extremism in USDA Programs,” Heritage Foundation Backgrounder No. 2916, May 30, 2014.

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending slightly compared to FY 2019. INCLUDED

72 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 AG

The Heritage Foundation | heritage.org/BlueprintForBalance $5.0 MANDATORY SAVINGS IN BILLIONS5

Repeal the USDA Agricultural Risk Coverage and Price Loss Coverage Programs The ARC and PLC programs are two major subsidy According to the Congressional Research Service, programs that apply to about 20 commodities. On from 2014–2016, 94 percent of farm program sup- a crop-by-crop basis, farmers can participate in port went to just six commodities—corn, cotton, the ARC program or the PLC program. The ARC peanuts, rice, soybeans, and wheat—that together program protects farmers from shallow losses, account for only 28 percent of farm receipts.6 Even providing payments when their actual revenues worse, this assistance is generally not provided to fall below 86 percent of the expected revenues for help with actual disasters but to help ensure farmers their crops. The PLC program provides payments to meet revenue goals. farmers when commodity prices fall below a fixed, statutorily established reference price. The ARC and PLC programs are a major part of this excessive and inappropriate assistance to a small These programs go far beyond providing a safety group of favored producers. In a December 2018 net for farmers. Most farmers succeed even though report, the Congressional Budget Ofce identified they receive little to no taxpayer assistance. If they elimination of Title I programs (including the ARC do receive assistance, it is usually to help with a and PLC programs) as an option for reducing the disaster or crop loss. Yet a small number of produc- deficit,7 observing that “agricultural producers have ers growing a small number of commodities receive access to a variety of other federal assistance pro- significant amounts of taxpayer dollars, including grams, such as subsidized crop insurance and farm through the ARC and PLC programs. credit assistance programs.”8

ADDITIONAL READING " Daren Bakst, ed., “Farms and Free Enterprise: A Blueprint for Agricultural Policy,” Heritage Foundation Mandate for Leadership Series, 2016. " Daren Bakst, Josh Sewell, and Brian Wright, “Addressing Risk in Agriculture,” Heritage Foundation Special Report No. 189, September 8, 2016. " Daren Bakst, “Signiﬁcant—and Necessary—Farm Subsidy Reforms for the Next Farm Bill,” Heritage Foundation Issue Brief No. 4839, April 17, 2018. " Daren Bakst, “What You Should Know About Who Receives Farm Subsidies,” Heritage Foundation Backgrounder No. 3306, April 16, 2018.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 73 AG The Heritage Foundation | heritage.org/BlueprintForBalance $9.7 MANDATORY SAVINGS IN BILLIONS9

Include a Work Requirement for Able-Bodied Adult Food Stamp Recipients The food stamp program is the second largest of the of self-sufciency by directing individuals toward government’s 89 means-tested welfare programs. work. Policymakers should also structure the work The number of food stamp recipients has risen requirement so that it does not discourage mar- dramatically from about 17.2 million in 2000 to 40.3 riage, which is one of the most important pathways million in 2018. Costs have risen from $19.8 billion out of poverty. in FY 2000 to $73.7 billion in FY 2017. The U.S. Department of Agriculture recently Food stamp assistance should be directed to those announced a proposed rule that would strengthen who are most in need. Able-bodied adults who existing work requirements for able-bodied adults receive food stamps should be required to work, who are without dependents. This is a step in the prepare for work, or look for work in exchange for right direction, but Congress should expand work this assistance. Work requirements not only help to requirements for nearly all able-bodied adults who ensure that food stamps are directed to those who receive food stamps in ways that encourage, not need them most, but also promote the principle discourage, marriage.

ADDITIONAL READING " Jamie Bryan Hall, “Here Are 2 Ways Trump Can Help Americans Move from Food Stamps to Work,” The Daily Signal, December 18, 2018. " Robert Rector, Jamie Bryan Hall, and Mimi Teixeira, “Five Steps Congress Can Take to Encourage Work in the Food Stamps Program,” Heritage Foundation Issue Brief No. 4840, April 20, 2018. " Robert Rector, Rachel Shefeld, Kevin D. Dayaratna, and Jamie Bryan Hall, “Maine Food Stamp Work Requirement Cuts Non-Parent Caseload by 80 Percent,” Heritage Foundation Backgrounder No. 3091, February 8, 2016.

PROPOSAL STATUS EXPLANATION

Requires able-bodied SNAP participants (18–65 years of President’s Budget (FY2020) INCLUDED age) to engage in at least 20 hours of work or work-related activities per week.

74 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 AG

The Heritage Foundation | heritage.org/BlueprintForBalance $525 MANDATORY SAVINGS IN MILLIONS10

End Broad-Based Categorical Eligibility for Food Stamps

Categorical eligibility traditionally allows indi- assistance, states can extend food stamp beneﬁts to viduals who receive cash welfare assistance from those with higher incomes than otherwise would programs such as Temporary Assistance for Needy be permissible. Families to enroll in food stamps automatically. Under “broad-based categorical eligibility,” states Moreover, broad-based categorical eligibility allows can now loosen income limits and bypass asset states to waive asset tests entirely. An individual tests for potential recipients of food stamps. Indi- with a temporarily low income can receive a TANF viduals or families can simply receive some type of service and then become categorically eligible for TANF “service” and automatically become cate- food stamps even if he or she has a large amount gorically eligible for food stamps. Because TANF of savings. Policymakers should end broad-based services are available to households with incomes categorical eligibility to ensure that food stamps are higher than those that are eligible for TANF cash focused on helping those who are truly in need.

ADDITIONAL READING " Robert Rector and Katherine Bradley, “Reforming the Food Stamp Program,” Heritage Foundation Backgrounder No. 2708, July 25, 2012. " Rachel Shefeld, “How to Reform Food Stamps,” Heritage Foundation Issue Brief No. 4045, September 12, 2013.

PROPOSAL STATUS EXPLANATION

Limits categorical eligibility to recipients of SSI or TANF President’s Budget (FY2020) INCLUDED cash beneﬁts.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 75 AG The Heritage Foundation | heritage.org/BlueprintForBalance $560 MANDATORY SAVINGS IN MILLIONS11

Eliminate the “Heat and Eat” Loophole in Food Stamps

Using a loophole known as “heat and eat,” states LIHEAP checks for amounts as small as $1 to food can artificially boost a household’s food stamp stamp recipients. benefit. The amount of food stamps a household receives is based on its “countable” income Although the 2014 farm bill tightened this loophole (income minus certain deductions). Households by requiring that a household must receive more that receive benefits from the Low-Income Heat than $20 annually in LIHEAP payments to be eligi- and Energy Assistance Program are eligible for a ble for the larger utility deduction and subsequently larger utility deduction. In order to make house- higher food stamp benefits, some states have con- holds eligible for the higher deduction and thus for tinued to use it by paying more than $20 per year. greater food stamp benefits, states have distributed Policymakers should eliminate this loophole.

ADDITIONAL READING " Rachel Shefeld, “How to Reform Food Stamps,” Heritage Foundation Issue Brief No. 4045, September 12, 2013. " Daren Bakst and Rachel Shefeld, “Eight Things to Watch for in the Farm Bill,” Heritage Foundation Issue Brief No. 4101, December 4, 2013.

PROPOSAL STATUS EXPLANATION

Contains a number of proposals, including standardizing NOT how states account for utility costs and eliminating President’s Budget (FY2020) ADDRESSED eligibility loopholes, but does not seek elimination of the policy.

76 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 AG

The Heritage Foundation | heritage.org/BlueprintForBalance $28 DISCRETIONARY SAVINGS IN MILLIONS12

Eliminate Funding for the Community Eligibility Provision

The community eligibility provision is a policy that The community eligibility provision is essen- was implemented by the Healthy, Hunger-Free tially a backdoor approach to universal school Kids Act of 2010. It expands free school meals to meals. Schools should not be providing welfare include students regardless of family income. Under to middle-class and wealthy students. Ending the this provision, if 40 percent of students in a school, community eligibility provision would ensure that group of schools, or school district are identiﬁed as free meals are going only to students from low-ineligible for free meals because they receive bene- come families. No further funding should be used to ﬁts from another means-tested welfare program implement this provision. like food stamps, then all students can receive free meals.

PROPOSAL STATUS EXPLANATION

Closes a participation loophole in the CEP by limiting PARTIALLY President’s Budget (FY2020) eligibility only to individual schools that meet the 40 INCLUDED percent threshold.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 77 AG The Heritage Foundation | heritage.org/BlueprintForBalance $0 MANDATORY (NO SAVINGS)13

Eliminate the USDA Sugar Program

The USDA sugar program uses price supports and This program may beneﬁt a small number of sugar marketing allotments that limit how much sugar growers and harvesters, but it does so at the expense processors can sell each year. It also restricts of sugar-using industries and consumers. An Inter- imports of sugar. As a result of government international Trade Administration report found that vention to limit supply, the price of American sugar “[f]or each sugar growing and harvesting job saved is consistently higher than (and at times twice as through high U.S. sugar prices, nearly three confec- high as) world prices.14 tionery manufacturing jobs are lost.”15 The program is also a hidden tax on consumers: Recent studies have found that it costs consumers as much as $3.7 billion a year.16

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

78 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 AG

The Heritage Foundation | heritage.org/BlueprintForBalance $1.9 MANDATORY SAVINGS IN BILLIONS17

Eliminate USDA Revenue-Based Crop Insurance Policies

Any reasonable concept of a taxpayer-funded safety can even have greater yields than expected and still net for farmers would require a signiﬁcant crop loss, receive indemnity payments if commodity prices but this program does not require yield losses for are lower than expected. farmers to receive indemnities. There are generally two types of federal crop insurance: yield-based, The federal government should not be in the which protects farmers from yields that are lower business of insuring price or revenue; agricultural than expected due to events beyond the control producers, like other businesses, should not be insu- of farmers, such as weather and crop disease, and lated from market forces or guaranteed ﬁnancial revenue-based, which protects farmers from dips success at the expense of taxpayers. Revenue-based in expected revenue due to low prices, low yields, crop insurance is unnecessarily generous and or both. Revenue-based policies, which are more should be eliminated. Taxpayer-subsidized crop popular than yield-based policies because they do insurance should be limited to yield insurance as it not require yield losses, accounted for 77 percent was in the past. of all policies earning premiums in 2014.18 Farmers

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 79 AG The Heritage Foundation | heritage.org/BlueprintForBalance $200 MANDATORY SAVINGS IN MILLIONS19

Eliminate the USDA Market Access Program

MAP subsidizes trade associations, businesses, It is not government’s role to advance the market- and other private entities to help them market and ing interests of certain industries or businesses. promote their products overseas. Under MAP, tax- Taxpayers should not be forced to subsidize the payers have recently helped to fund international marketing that private businesses can do on wine tastings, organic hair products for cats and their own. dogs, and a reality television show in India.

ADDITIONAL READING " Daren Bakst, “Addressing Waste, Abuse, and Extremism in USDA Programs,” Heritage Foundation Backgrounder No. 2916, May 30, 2014. " Senator Tom Coburn, “Treasure Map: The Market Access Program’s Bounty of Waste, Loot and Spoils Plundered from Taxpayers,” June 2012.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at FY 2019 levels.

80 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 AG

The Heritage Foundation | heritage.org/BlueprintForBalance $200 MANDATORY SAVINGS IN MILLIONS20

Reduce Premium Subsidies in the Federal Crop Insurance Program

Taxpayers pay on average 62 percent of crop insur- The CBO found that reducing premium subsidies ance premiums, but farmers pay only 38 percent by 15 percentage points to 47 percent would reduce for their own policies. This is an unreasonable and the number of insured acres (300 million) by just unnecessary burden on taxpayers, yet the concept one-half of 1 percent, to 298.5 million acres. It also of reducing premium subsidies has wide support, explained that 1.5 percent of insured acres would including in President Donald Trump’s ﬁscal 2019 have lower coverage levels. The CBO estimated that budget and President Barack Obama’s ﬁscal 2014 this reform would save $8.1 billion over 10 years.23 budget, as well as from the Government Account- According to the CBO, reducing the premium sub- ability Ofce.21 sidy to 40 percent would save $16.9 billion over 10 years (but only $200 million in FY 2020 because of Critics will argue that reducing premium subsidies the time it would take to implement).24 This would would hurt participation in the crop insurance presumably afect crop insurance participation program. However, the research overwhelmingly more than reducing the subsidy to a 47 percent level indicates otherwise. According to the Government would, but the CBO notes that “[a]n argument in

Accountability Ofce, “The [Obama] adminis- favor of this option is that cutting the federal subsi- tration, CBO, and other researchers say that a dies for premiums would probably not substantially modest reduction in premium subsidies would afect participation in the program.”25 In addition, have little impact on program participation, and for participating farmers, this subsidy would remain that incentives, such as the continued high level of very generous. premium subsidies, would likely keep farmers in the program.”22 This subsidy reform has massive beneﬁts and would likely entail little cost. Quite simply, it should be a no-brainer for Congress.

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces the premium subsidy to 50%. INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 81 AG the roleofparentsinhelpingtheirchildrenmake dietary decisions. Any newstandards shouldgive states andlocaleducationalauthoritiesmuchgreaterflexibilityrespect the costs imposedby thesestandards. partly becauseofthestandards. remained asignificantproblem,andsomeschoolshaddroppedoutoftheschoollunchprogramatleast implementation ofthesestandards, participationintheschoollunchprogramhaddeclined,food waste negative outcomes. InSeptember 2015, theGovernmentOfcefoundthatsince Accountability Healthy, Hunger-Free of2010 have KidsAct failed.Theyareaburdenonschoolsandhave ledtomany Prohibit fundingfornationalschool-mealstandards. farmers may sellandshouldgetthegovernment outofthemarket business. andcartelmanagement Congress shouldstop fundingthesevolume controlsthatlimithow muchoftheirown fruitsandvegetables the amountsthatagriculturalproducersmay sell.Marketing ordersarebadenough,butataminimum, marketing orders to enforceanumberofcartelsthroughindustry agreementsknown asmarketing orders. Fruit andvegetable natureofthegovernment’soutrageous actions, itisfarfromunique.Inparticular, theUSDA usesitspower property requiringjust compensation. Althoughthe“raisincase”received muchattention becauseofthe to thegovernment. TheCourtheldthatforcinggrowers toturnover theirraisinswas atakingofprivate involving thefederalgovernment’s authoritytofineraisingrowers whodid not handover partoftheircrop In June 2015, theSupremeCourtofUnitedStatesdecided Withhold fundingforfederalfruit-supplyandvegetable-supply restrictions inmarketing orders. POLICY RIDERS 82 | Foundation Heritage The 27 allow thefederalgovernment toauthorizesupplyrestrictions (volume controls),limiting Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance 29 Someschoolshave even hadtodraw fromtheireducationfundstocover 30 Nofundingshouldbeusedtoimplementorenforcethesestandards. A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A The USDA’s school-mealstandards forthe Horne v. DepartmentofAgriculture , 26 acase 28 AG

83 CBO’s April CBO’s , GAO–12–411, , GAO–12–411, , May 2, 2018, 2, 2018, , May , April 20, 2010, 2010, , April 20, Cost Estimate Cost Cost Estimate Cost , January 28, 2019, , January 28, 2019, , p. 24, 24, , p. , https://www.obpa.usda.gov/22fsis2019notes.pdf , https://www.obpa.usda.gov/22fsis2019notes.pdf , December 2018, 2018, , December No. 3091, February 8, 2016, 8, 2016, 3091, February No. Employment Changes in U.S. Food Manufacturing: The Impact of Sugar of Impact The Manufacturing: Food Changes in U.S. Employment FY 2019 Budget Summary Budget FY 2019 Backgrounder A FEDERAL BUDGET FOR FISCAL YEAR 2020 , August 11, 2017, https://fas.org/sgp/crs/misc/R44914.pdf (accessed March 6, 2019). March (accessed https://fas.org/sgp/crs/misc/R44914.pdf 11, 2017, , August . CBO’s January 2019 Baseline for Farm Programs Baseline Farm January 2019 for CBO’s Seafood Safety: Responsibility for Inspecting Catfish Should Not Be Assigned to USDA to Be Assigned Should Not Catfish Inspecting for Responsibility Safety: Seafood , April 9, 2018, https://www.cbo.gov/sites/default/files/recurringdata/51317-2018-04-usda.pdf (accessed (accessed https://www.cbo.gov/sites/default/files/recurringdata/51317-2018-04-usda.pdf 2018, , April 9, Options for Reducing the Deficit: 2019 to 2028 to the Deficit: 2019 Reducing Options for No. 13-WP 538, May 2013, https://www.card.iastate.edu/products/publications/pdf/13wp538.pdf (accessed (accessed https://www.card.iastate.edu/products/publications/pdf/13wp538.pdf 2013, May 538, 13-WP No. 2019 President’s Budget: Food Safety and Inspection Service and Inspection Safety Food Budget: President’s 2019 heritage.org/BlueprintForBalance Blueprint for Balance: Working Paper Working , undated, p. 2, https://www.trade.gov/mas/ian/build/groups/public/@tg_ian/documents/webcontent/tg_ian_002705.pdf (accessed (accessed 2, https://www.trade.gov/mas/ian/build/groups/public/@tg_ian/documents/webcontent/tg_ian_002705.pdf p. , undated, ectsPaperJune2013.pdf (accessed March 11, 2019). 11, March (accessed ectsPaperJune2013.pdf f http://fairsugarpolicy.org/wordpress/wp-content/uploads/2018/03/AgralyticaEconomicE ce, “H.R. 2, Agriculture and Nutrition “H.R. 2, Agriculture Ofce, Budget See Congressional of implementation. full year the first represents because FY 2020 11, 2019). March (accessed https://www.cbo.gov/publication/21418 have enacted this reform. Specifically, we use the CBO’s FY 2020 estimate for “Sec. 4006, Update to Categorical Eligibility” because Eligibility” Categorical to “Sec. 4006, Update for estimate FY 2020 use the CBO’s we Specifically, this reform. enacted have represents million in savings All $525 7. p. 6, 2019), March (accessed https://www.cbo.gov/system/files?file=2018-07/hr2_1.pdf https://www.cbo.gov/system/files?file=2018-12/54667-budgetoptions.pdf (accessed March 6, 2019). March (accessed https://www.cbo.gov/system/files?file=2018-12/54667-budgetoptions.pdf All http://www.heritage.org/research/reports/2016/02/maine-food-stamp-work-requirement-cuts-non-parent-caseload-by-80-percent. https://www.usda.gov/sites/default/files/documents/usda-fy19-budget-summary.pdf (accessed March 6, 2019). Heritage experts assume assume Heritage experts 6, 2019). March (accessed https://www.usda.gov/sites/default/files/documents/usda-fy19-budget-summary.pdf million in include $115 Savings 11, 2019). March (accessed https://www.cbo.gov/system/files?file=2019-01/51317-2019-01-usda.pdf Development Development 11, 2019). March ce, Ofce, Budget period. Congressional the 2020–2029 million over of $119 cost a total will have the sugar program that it projects FY 2020, 11, 2019). March Reported by the Senate Committee on Agriculture, Nutrition and Forestry on March 24, 2010,” 2010,” 24, on March Nutrition and Forestry on Agriculture, Committee the Senate by Reported Nutrition Act of 2018, As Ordered Reported by the House Committee on Agriculture on April 18, 2018,” on April 18, 2018,” on Agriculture the House Committee by Reported As Ordered of 2018, Nutrition Act Parent Caseload by 80 Percent,” Heritage Foundation Heritage Foundation 80 Percent,” Caseload by Parent March 6, 2019). Estimated savings of $4.808 billion in FY 2020 include $2.653 billion for the PLC; $2.137 billion for the ARC-CO (county); and (county); the ARC-CO billion for $2.137 the PLC; billion for include $2.653 billion in FY 2020 of $4.808 savings Estimated 6, 2019). March Department of Agriculture, of Agriculture, Department 2019). 10, March (accessed http://www.gao.gov/products/GAO-12-411 2012, May that the FY 2018 spending level remains constant in FY 2019. in constant remains spending level 2018 the FY that updated October 18, 2017, https://www.gao.gov/duplication/action_tracker/Catfish_Inspection/action1 (accessed March 6, 2019), and U.S. and U.S. 6, 2019), March (accessed https://www.gao.gov/duplication/action_tracker/Catfish_Inspection/action1 18, 2017, October updated $9.7 billion in savings represents mandatory spending. mandatory represents billion in savings $9.7 $18 million for the ARC-IC (individual coverage). Ibid., pp. 6 and 9. All $4.808 billion in savings represents mandatory spending. mandatory represents billion in savings All $4.808 6 and 9. Ibid., pp. (individual coverage). the ARC-IC million for $18 mandatory spending. mandatory mandatory spending. mandatory million for FY 2018 as found in U.S. Department of Agriculture, of Agriculture, Department in U.S. as found FY 2018 million for Ofce, Budget See Congressional projections. ce, “Duplication & Cost Savings: Agriculture: Catfish Inspection,” last last Inspection,” Catfish Agriculture: Savings: & Cost “Duplication Ofce, Accountability Government See U.S. $2.6 million annually. million to we use the estimated FY 2020 savings for “Sec. 4010, Availability of Standard Utility Allowances Based on Receipt of Energy Assistance,” Assistance,” of Energy Based on Receipt Allowances Utility of Standard Availability “Sec. 4010, for savings FY 2020 use the estimated we eld, Kevin D. Dayaratna, and Jamie Bryan Hall, “Maine Food Stamp Work Requirement Cuts Non- Requirement Work Stamp Hall, “Maine Food and Jamie Bryan Dayaratna, D. Shefeld, Kevin was transferred from the FDA to the FSIS. Subsequently, the FSIS revised its estimated annual cost of the program downward from $14 $14 from downward of the program cost annual its estimated FSIS revised the the FSIS. Subsequently, to FDA the from transferred was C. Beghin and Amani Elobeid, “The Impact of the U.S. Sugar Program Redux,” Iowa State University, Center for Agricultural and Rural and Rural Agricultural for Center University, State Iowa Redux,” Sugar Program of the U.S. Impact C. Beghin and Amani Elobeid, “The Prices Report for Members and Committees of Congress of Committees Members and for Report discretionary spending and $378 million in mandatory spending. in mandatory million $378 spending and discretionary ective March 1, 2016, and with a full compliance date of September 1, 2017), catfish inspection inspection catfish 1, 2017), of September date a full compliance and with 1, 2016, March ective ef 2015, 2, December issued §§ 530–561, ce, “H.R. 2, Agriculture and “H.R. 2, Agriculture Ofce, Budget See Congressional implementation. of the proposal’s full year the first represents 2020 (accessed March 6, 2019). March (accessed ce) pursuant to a transfer of the program’s administration. Under a final rule (9 CFR Under a final rule administration. of the program’s a transfer to pursuant Ofce) Accountability the Government by (as reported ce, Ofce, Accountability Government U.S. Savings of $9.7 billion for FY 2020 are based on analysis contained in Robert Rector, Rachel Rector, in Robert contained based on analysis are FY 2020 for billion of $9.7 Savings Savings of $2.6 million for FY 2020 are based on estimates from the U.S. Department of Agriculture’s Food Safety and Inspection Service Service and Inspection Safety Food of Agriculture’s Department the U.S. from estimates based on are FY 2020 for of $2.6 million Savings ects of the Sugar Program Since the 2008 Farm Bill & Policy Implications for the 2013 Farm Bill,” June 3, 2013, June 3, 2013, Bill,” Farm the 2013 for Implications Bill & Policy the 2008 Farm Since of the Sugar Program ects f E “Economic Agralytica, Administration, Trade International of Commerce, Department U.S. ects of the Sugar Program Since the 2008 Farm Bill & Policy Implications for the 2013 Farm Bill.” See also John Bill.” Farm the 2013 for Implications Bill & Policy the 2008 Farm Since of the Sugar Program ects f E “Economic Agralytica, ce, “Healthy, Hunger-Free Kids Act of 2010, As Ordered As Ordered of 2010, Kids Act Hunger-Free “Healthy, Ofce, Budget based on Congressional are of $28 million in FY 2020 Savings in cost zero estimates Although the CBO of the program. cost FY 2020 estimated based on the CBO’s are of $0 million in FY 2020 Savings Savings of $525 million for FY 2020 are based on the CBO’s analysis of the impact of previously proposed legislation that would would that legislation proposed of previously of the impact analysis based on the CBO’s are FY 2020 million for of $525 Savings Specifically, this change. enacted have would that a proposal from savings based on estimated are FY 2020 million for of $560 Savings ce, Ofce, Budget Congressional Savings of $493 million for FY 2020 are based on the CBO’s most recent January 2019 baseline spending January 2019 recent most based on the CBO’s are FY 2020 for million of $493 Savings Randy Schnepf, “Farm Safety-Net Payments Under the 2014 Farm Bill: Comparison by Program Crop,” Congressional Research Service Service Research Congressional Crop,” Program by Bill: Comparison Farm Under the 2014 Payments Safety-Net “Farm Randy Schnepf, Ibid., p. 18. Ibid., p. ce, Ofce, Budget in Congressional as reported PLC and the ARC for based on projections are FY 2020 billion for of $4.97 Savings Savings of $754 million for FY 2020 are based on the most recent estimated spending level of $754 of $754 spending level estimated recent based on the most are FY 2020 million for of $754 Savings CBO’s January 2019 Baseline for Farm Programs Baseline Farm January 2019 for CBO’s 2018 Baseline for Farm Programs Baseline Farm 2018 for Act of 2018, As Ordered Reported by the House Committee on Agriculture on April 18, 2018,” p. 7. All $560 million in savings represents represents million in savings All $560 7. p. on April 18, 2018,” on Agriculture the House Committee by Reported As Ordered of 2018, Act

8. 5. 6. 9. ENDNOTES 16. 14. 15. 13. 12. 11. 10. 1. The Heritage Foundation | 2. 3. 7. 4. AG 30. 21. 20. 29. 28. 27. 26. 25. 24. 23. 22. 19. 18. 17. 84 | Foundation Heritage The

“Specialty Crops Marketing Orders &Agreements,” https://www.ams.usda.gov/rules-regulations/moa/fv (accessed March 11,2019), and Accountability Ofce, August 13,2015, https://fas.org/sgp/crs/misc/R40532.pdf (accessed March 11,2019). 2018 Baseline for2018 Farm Baseline Programs Changes inNutritionStandards Considerations inReducing Federal Premium Subsidies Erik Wasson, “Michelle’s MealsTurn OftheKids,” Horne v. Department of Agriculture Savings of$200millionfor FY2020 are basedonestimates for federal farm program costs inCongressional Budget Ofce, Dennis A.Shields,“Federal Crop Insurance: Background,” Congressional Research Service Savings ofat least $1.92 billionfor FY2020 are basedonaCBO analysis offederal crop insurance costs that provides estimated savings Savings of$200millionare basedontheCBO’s projected savings from reducing thesubsidylevel to 40percent. The CBO projects $16.8 U.S. Government Accountability Ofce, Daren Bakst, “The Federal Government ShouldStop ofCertain LimitingtheSale For adiscussion ofthe40percent premium subsidylevel asidentified by theCBO, seeibid.,pp. 19–20. Congressional Budget Ofce, U.S. Government Accountability Ofce, U.S. Department ofAgriculture, These marketing orders cover fruits,vegetables, andspecialty crops. SeeU.S. Department ofAgriculture, Agricultural Marketing Service, Congressional Budget Ofce, (accessed March 11,2019). There alsoare milkmarketing orders, butthey are diferent from fruitandvegetable 2012, https://www.gao.gov/assets/590/589305.pdf (accessed March 11,2019); andGovernment Accountability Ofce, and AnnualPerformance Plan on theprojected price ofcrops at thetimepolicy is issued instead ofproviding for thegreater oftheprojected price andtheactual CBO estimates that thischangeinrevenue-based policieswould save $19.2 billionover the2018–2027 period,for anaverage of$1.92 billion Congressional Budget Ofce, marketing orders. SeeU.S. Department ofAgriculture, Agricultural Marketing Service, “Federal MilkMarketing Orders,” per year. Congressional Budget Ofce, $1.92 billioninsavings represents mandatory spending. for amore limited proposal to restrict theway producers’ costs are estimated for revenue-based policiesby requiring that costs bebased U.S. Department ofAgriculture, Agricultural Marketing Service, “Fruit, Vegetables, &Specialty Crops Marketing Orders andAgreements,” Fruits andVegetables,” HeritageFoundation Marketing Service, “Federal MilkMarketing Order Program: Understanding theMilkOrder Amendment Process,” April2013, May 2017, https://www.ams.usda.gov/publications/content/fruit-vegetables-specialty-crop-marketing-orders-and-agreements March 11,2019), discussing premium subsidydata andfocusing onrecommendation to reduce premium subsidyfor revenue policies. http://thehill.com/policy/finance/206734-michelles-meals-turn-of-the-kids (accessed March 11,2019). http://www.heritage.org/research/reports/2015/09/the-federal-government-should-stop-limiting-the-sale-of-certain-fruits-and-vegetables. https://www.ams.usda.gov/sites/default/files/media/DairyMarketingOrderAmendmentBrochure.pdf (accessed March 11,2019). http://www.ams.usda.gov/rules-regulations/moa/dairy (accessed March 11,2019), andU.S. Department ofAgriculture, Agricultural https://www.obpa.usda.gov/budsum/fy19budsum.pdf (accessed March 11,2019); U.S. Department ofAgriculture, billion insavings over 10years, butitprojects only$200millionfor FY2020 becausethefullsavings would notberealized immediately. https://www.cbo.gov/system/files/115th-congress-2017-2018/reports/53375-federalcropinsuranceprogram.pdf (accessed March 4, 2019). All harvest price. Althoughthisproposal would noteliminate revenue-based crop insurance policiesentirely, itwould limittheircosts. The Crop Insurance: Savings Would Result from Program ChangesandGreater Use of Data Mining Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance Options for Reducing theDeficit:2019 to 2028 Options to Reduce theBudgetary Costs of theFederal Crop Insurance Program Options for Reducing theDeficit:2019 to 2028 , https://www.obpa.usda.gov/budsum/FY14budsum.pdf (accessed March 11,2019); U.S. Government , GAO–15–656, September 2015, https://www.gao.gov/assets/680/672477.pdf (accessed March 11,2019). FY 2019 Budget Summary . All$200millioninsavings represents mandatory spending. , 135 S.Ct. 2419 (2015), https://www.law.cornell.edu/supremecourt/text/14-275 (accessed March 11,2019). Options to Reduce theBudgetary Cost of theFederal Crop Insurance Program Crop Insurance: Considerations inReducing Federal Premium Subsidies School Nutrition:USDA HasEforts Underway to HelpAddress OngoingChallengesImplementing Issue Brief The Hill A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A , GAO-14-700, August 2014, https://www.gao.gov/assets/670/665267.pdf (accessed No. 4466,September 29, 2015, , May 21,2014, , revised February 162018, , p. 19. , pp. 19–20. Report for MembersandCommittees of Congress , p. 21. , p. 29. FY 2014 Budget Summary , GAO-12-256, March , December 2017, Crop Insurance: CBO’s April , Commerce, Justice, Science, and Related Agencies The Heritage Foundation | heritage.org/BlueprintForBalance $304 DISCRETIONARY SAVINGS IN MILLIONS1 CJS Eliminate the Justice Department’s Office of Community Oriented Policing Services Created in 1994, COPS promised to put 100,000 new local governments. According to former Attorney state and local law enforcement ofcers on Ameri- General Jef Sessions, during the Obama Admin- ca’s streets by 2000. It failed to add 100,000 ofcers istration, the COPS program was also diverted to and failed to reduce crime. “expensive wide-ranging investigative assessments” that included attempts to “reform” law enforcement In Federalist No. 45, James Madison wrote that agencies and institute requirements such as “inher- “[t]he powers delegated by the proposed Constitu- ent bias” training based on flawed and unproven tion to the federal government are few and defined. social science.2 Those which are to remain in the State governments are numerous and indefinite.” When Congress funds The COPS program has a demonstrated record of the routine, day-to-day operations of local police poor performance and should be eliminated. The departments in this manner, it efectively reassigns resources provided by the program are spread thin to the federal government the powers and respon- across many law enforcement agencies and are not sibilities that fall squarely within the expertise, well targeted toward achieving favorable public historical control, and constitutional authority of safety outcomes. COPS grants also unnecessarily state and local governments. The responsibility to fund functions that are the responsibility of state combat ordinary crime at the local level belongs and local governments. almost wholly, if not exclusively, to state and

ADDITIONAL READING " David B. Muhlhausen, “Byrne JAG and COPS Grant Funding Will Not Stimulate the Economy,” testimony before the Committee on the Judiciary, U.S. Senate, May 12, 2009. " David B. Muhlhausen, “Impact Evaluation of COPS Grants in Large Cities,” Heritage Foundation Center for Data

Analysis Report No. CDA06-03, May 26, 2006.

PROPOSAL STATUS EXPLANATION

Merges with the Ofce of Justice and cuts all but $99 President’s Budget (FY2020) INCLUDED million in spending.

86 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $1.8 DISCRETIONARY SAVINGS IN BILLIONS3 CJS

Eliminate Grants Within the Justice Department’s Office of Justice Programs The majority of the programs under the OJP are almost entirely and inherently local in nature umbrella deal with problems or functions within and are therefore regulated by state criminal law, the jurisdiction of state and local governments. OJP state law enforcement, and state courts. The fact grants are given to state and local governments for that thefts by juveniles occur in all states does not many criminal justice purposes, including local mean that these thefts require action by the fed- police ofcers’ salaries, state corrections, court pro- eral government. grams, and juvenile justice programs. State and local ofcials, not the federal government, In addressing criminal activity appropriately, the are responsible for funding the state and local crim- federal government should limit itself to handling inal justice system. The OJP subsidizes the routine, tasks that state and local governments cannot day-to-day functions of state and local criminal perform by themselves and that the Constitution justice programs. The responsibility to combat ordi- commits to the federal government. For example, nary crime at the local level belongs almost wholly, juvenile delinquency is a problem common to all if not exclusively, to state and local governments. states, but the crimes that delinquents commit

ADDITIONAL READING " David B. Muhlhausen, “Get Out of Jail Free: Taxpayer-Funded Grants Place Criminals on the Street Without Posting Bail,” Heritage Foundation WebMemo No. 3361, September 12, 2011. " David B. Muhlhausen, “Where the Justice Department Can Find $2.6 Billion for its Anti-Terrorism Eforts,” Heritage Foundation Backgrounder No. 1486, October 5, 2001.

PROPOSAL STATUS EXPLANATION

PARTIALLY Eliminates $244 million from OJP-administered State President’s Budget (FY2020) INCLUDED Criminal Alien Assistance Program.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 87 The Heritage Foundation | heritage.org/BlueprintForBalance $498 DISCRETIONARY SAVINGS IN MILLIONS4 CJS Eliminate Violence Against Women Act Programs and Grants

VAWA programs, created in 1994, exist principally The services funded by VAWA programs and grants to mitigate, reduce, or prevent the efects and occur- are properly funded and implemented locally. Using rence of domestic violence. However, grant programs federal agencies to fund the routine operations of under the VAWA have not undergone nationally domestic violence programs that state and local representative, scientiﬁcally rigorous experimental governments could provide is a misuse of federal evaluations of their efectiveness. The U.S. General resources and distracts attention from concerns Accounting (now Government Accountability) that are the province of the federal government. Ofce concluded that previous evaluations of VAWA Moreover, the administrative cost of funneling state programs “demonstrated a variety of methodological resources back to the states through the federal limitations, raising concerns as to whether the eval- government actually reduces the overall level of uations will produce deﬁnitive results.”5 In addition, available resources. the evaluations were not representative of the types of programs funded nationally by the VAWA.

ADDITIONAL READING " Paul J. Larkin, Jr., “Send in the Lawyers: The House Passes the Senate’s Violence Against Women Act,” The Daily Signal, March 1, 2013. " David B. Muhlhausen and Christina Villegas, “Violence Against Women Act: Reauthorization Fundamentally Flawed,” Heritage Foundation Backgrounder No. 2673, March 29, 2012.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at FY 2019 levels.

88 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $415 DISCRETIONARY SAVINGS IN MILLIONS6 CJS

Eliminate the Legal Services Corporation

The LSC was created by the Legal Services Act of Although LSC grants do help to provide high-quality 1974 to provide civil legal assistance to indigent cli- civil legal assistance to some low-income Americans, ents. It does this by distributing federal grant funds the Congressional Budget Ofce regularly includes to service areas throughout the United States and LSC funding among its options for decreasing the its territories in award increments of one to three deficit, observing that many recipient programs years; 93 percent of LSC funding is distributed to already receive resources from state and local 133 nonprofit legal aid programs. The annual appro- governments and private entities. State and local priations legislation specifies the types of activities governments, supplemented by donations from other for which the funds may be used and prohibits the outside sources, are better equipped to address the use of funds for such purposes as political activity, needs of those in their communities who rely on advocacy, demonstrations, strikes, class-action these free services. Giving local entities sole responsi- lawsuits, and cases involving abortion, partisan bility for indigent legal defense would allow funds to redistricting, and welfare reform. be targeted in the most efcient manner and remove this burden from the federal deficit.

ADDITIONAL READING " Congressional Budget Ofce, Budget Options: Volume 2, August 2009. " Ken Boehm, Chairman, National Legal and Policy Center, “What the Legal Services Corporation Doesn’t Want Congress to Know,” testimony submitted to the Subcommittee on Commerce, Justice, Science and Related Agencies, Committee on Appropriations, U.S. House of Representatives, March 22, 2012.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 89 The Heritage Foundation | heritage.org/BlueprintForBalance $49 DISCRETIONARY SAVINGS IN MILLIONS7 CJS Reduce Funding for the Justice Department’s Civil Rights Division

A 2013 report by the Justice Department Inspec- At a time when there is less discrimination than tor General described the Civil Rights Division as ever before in our society, the division is at its larg- having a “dysfunctional management chain” and est—far larger that it was in the 1960s when it was being torn by “polarization and mistrust.”8 The divi- fighting crucial civil rights battles. It has far more sion has undermined election integrity and has filed employees than vigorous enforcement of our civil abusive lawsuits intended to enforce progressive rights and voting rights laws requires, and its budget social ideology in areas ranging from public hiring can be cut significantly without sacrificing the to public education. division’s efciency and ability to protect the public from discrimination.

ADDITIONAL READING " J. Christian Adams, Injustice: Exposing the Racial Agenda of the Obama Justice Department (Washington: Regnery Publishing, 2011). " John Fund and Hans von Spakovsky, Obama’s Enforcer: Eric Holder’s Justice Department (New York: HarperCollins/ Broadside, 2014).

PROPOSAL STATUS EXPLANATION

Absorbs the Community Relations Service, thereby President’s Budget (FY2020) REJECTED augmenting the division.

90 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $35 DISCRETIONARY SAVINGS IN MILLIONS9 CJS

Reduce Funding for the Justice Department’s Environmental and Natural Resources Division The Justice Department’s ENR Division has suf- lawmaking out of the hands of Congress and put it in fered an embarrassing string of defeats in the courts the hands of agencies, private interests, and fed- because it has taken radical positions on environ- eral judges. mental issues far outside the legal mainstream. One federal court of appeals accused ENR Division law- Signiﬁcantly reducing its budget would encour- yers of making legal arguments in court that were age the ENR Division to concentrate on its core “so thin as to border on the frivolous.”10 It has also functions of defending the environmental laws of colluded in “sue and settle” lawsuits with extrem- the United States in a reasonable and common- ist environmental groups that take environmental sense manner.

ADDITIONAL READING

" Paul J. Larkin, Jr., “Justice Department Giving Away the Public’s Money to Third-Party Interests,” Heritage Foundation Commentary, March 11, 2015. " Andrew M. Grossman, “Regulation Through Sham Litigation: The Sue and Settle Phenomenon,” Heritage Foundation Legal Memorandum No. 110, February 25, 2014.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED No change is requested.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 91 The Heritage Foundation | heritage.org/BlueprintForBalance $15.5 DISCRETIONARY SAVINGS IN MILLIONS11 CJS Eliminate the Justice Department’s Community Relations Service

The CRS budget should be entirely eliminated. protests against George Zimmerman and Darren Rather than fulﬁlling its mandate of trying to be Wilson. Other employees inside the CRS have cited the peacemaker in community conﬂicts, the CRS a culture of incompetence, political decision-mak- has raised tensions in local communities. In both ing, and gross mismanagement that has led them to the Zimmerman case in Sanford, Florida, and the send a letter of complaint to the Attorney General of Wilson case in Ferguson, Missouri, for example, the United States. the CRS helped to organize and manage rallies and

ADDITIONAL READING " Hans von Spakovsky, “Corruption, Incompetence Scandal at DOJ’s Ferguson Unit Widens,” PJ Media, April 18, 2016. " John Fund and Hans von Spakovsky, Obama’s Enforcer: Eric Holder’s Justice Department (New York: HarperCollins/ Broadside, 2014).

PROPOSAL STATUS EXPLANATION

PARTIALLY Eliminates the Community Relations Service but President’s Budget (FY2020) INCLUDED transfers its functions to the Civil Rights Division.

92 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $12.0 MANDATORY (ONE-TIME) SAVINGS IN BILLIONS12 CJS

Rescind Unobligated Balances from the Justice Department’s Crime Victims Fund The CVF is contained within the Department of “savings” were never going to be spent. In the FY Justice and provides money to victims and survivors 2018 Consolidated Appropriations Act, Congress of crime, provides support services, and seeks to used phony savings from the CVF to increase unre- improve response to crime victim’s needs. Annual lated discretionary spending by over $10 billion. payments from the fund are capped each year at a level set by Congress. To stop the abuse of the CVF, Congress should rescind any balances above the obligation limita- The CVF carries a large unobligated balance that tion, as it did in the Bipartisan Budget Act of 2015, Congress uses as a budget gimmick for new spend- so that unspent funding can go toward deﬁcit reducing. Congress delays mandatory spending from the tion instead of being used as a budget gimmick for fund and then uses the savings to allow for more new spending. This would produce one-time savings discretionary spending. In reality, however, the of over $12 billion.

ADDITIONAL READING " Justin Bogie, “Budget Gimmicks Increase Federal Spending and Mask True Costs of Legislation,” Heritage Foundation Backgrounder No. 3234, July 26, 2017.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 93 The Heritage Foundation | heritage.org/BlueprintForBalance $666 MANDATORY (ONE-TIME) SAVINGS IN MILLIONS13 CJS Rescind Unobligated Balances from the Justice Department’s Asset Forfeiture Fund The Department of Justice’s Asset Forfeiture Fund Acts of 2013 and 2015, over $1.4 billion was taken is a repository for cash or property forfeited pur- from the Asset Forfeiture Fund to pay for unrelated suant to a law administered by the Department of spending increases. In addition to the budget deal, Justice. The fund is used to pay expenses of state since FY 2015, annual appropriations bills have and local law enforcement agencies associated rescinded several hundred million dollars from the with forfeitures. fund each year.

Increasingly, however, the Assets Forfeiture Fund is If the Assets Forfeiture Fund has excess funding, it being used as another tool to increase unrelated dis- should be used to reduce the deﬁcit, not to pay for cretionary spending. Between the Bipartisan Budget other spending.

ADDITIONAL READING " Justin Bogie, “Budget Gimmicks Increase Federal Spending and Mask True Costs of Legislation,” Heritage Foundation Backgrounder No. 3234, July 26, 2017.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

94 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $140 DISCRETIONARY SAVINGS IN MILLIONS14 CJS

Eliminate the Commerce Department’s Hollings Manufacturing Extension Partnership The Hollings Manufacturing Extension Partnership The government should not be playing a role in the is a federally funded management consulting oper- development of business. Federal involvement dis- ation directed at manufacturers. It is managed by torts market outcomes and picks winners and losers the National Institute of Standards and Technology among businesses. The Hollings Partnership is (NIST) of the U.S. Department of Commerce. The nothing more than corporate welfare, and it should Hollings Partnership provides subsidies to consul- be ended. tants, manufacturers, and business advisers with the goal of bettering the business practices of small and medium-size businesses.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 95 The Heritage Foundation | heritage.org/BlueprintForBalance $495 DISCRETIONARY SAVINGS IN MILLIONS15 CJS Eliminate the Commerce Department’s International Trade Administration The ITA serves as a sales department for certain busi- One ITA program is the International Buyer Pro- nesses and promotes investment in the U.S., ofering gram (IBP), which “recruits thousands of qualiﬁed taxpayer-funded subsidies for businesses that pro- foreign buyers, sales representatives, and business mote their products overseas. Promoting U.S. exports partners to U.S. trade shows each year, giving your is also a task carried out by the Department of exhibitors excellent opportunities to expand busi- Agriculture and the Department of State, rendering ness globally.”16 Private companies should facilitate the ITA’s eforts redundant. The ITA’s protectionist their own business meetings or do so through volun- policies, including antidumping and countervailing tary trade associations, not on the taxpayer’s dime. duty laws, interfere with free trade and drive up costs for both consumers and businesses.

ADDITIONAL READING " Michael Sargent, Romina Boccia, Emily J. Gof, David B. Muhlhausen, and Hans A. von Spakovsky, “Cutting the Commerce, Justice, and Science Spending Bill by $2.6 Billion: A Starting Point,” Heritage Foundation Issue Brief No. 4220, May 12, 2014.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at FY 2019 levels.

96 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $265 DISCRETIONARY SAVINGS IN MILLIONS17 CJS

Eliminate the Commerce Department’s Economic Development Administration The EDA provides taxpayer money and technical population. The EDA is just one of about 180 federal assistance to economically distressed areas in the economic development programs, including (among form of “grants” and “investments” for local proj- others) the Small Business Administration’s disaster ects, including the private sector. The EDA uses assistance loans and the Department of Agricul- taxpayer dollars to target local political pet projects ture’s rural development programs, that Congress with a very narrow beneﬁt—in many cases, just should eliminate. one particular company or small segment of the

ADDITIONAL READING " U.S. Government Accountability Ofce, Economic Development Administration: Documentation of Award Selection Decisions Could Be Improved, GAO-14-131, February 2014.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 97 The Heritage Foundation | heritage.org/BlueprintForBalance $40 DISCRETIONARY SAVINGS IN MILLIONS18 CJS Eliminate the Commerce Department’s Minority Business Development Agency The MBDA hands out grants and runs federally The MBDA helps businesses identify and respond to funded management consulting operations called federal procurement opportunities and, by tar- business centers in over 40 locations. Part of the geting certain racial and ethnic groups for special Department of Commerce, the agency reported government assistance, is a key component of the that its business centers assisted eligible businesses federal government’s afrmative action approach. with 1,108 ﬁnancings and contracts worth over $3.9 The federal government should not provide special billion in FY 2011.19 assistance to businesses to procure federal contracts; nor should it target such assistance based on racial or ethnic considerations.

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reforms the agency and reduces funding by nearly 75%. INCLUDED

98 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $6.2 DISCRETIONARY SAVINGS IN MILLIONS20 CJS

Eliminate Census Bureau Funding for the Annual Supplemental Poverty Measure Report The Census Bureau’s annual Supplemental Poverty the SPM determines a household’s poverty status by Measure is a relative measure; rather than deter- comparing its income to the income of other house- mining whether a household is poor based on its holds. The SPM undergirds a “spread-the-wealth” income, as the ofcial U.S. poverty measure does, agenda and should be eliminated.

ADDITIONAL READING " Rachel Shefeld and Robert Rector, “Obama’s New Poverty Measure ‘Spreads the Wealth,’” Heritage Foundation Commentary, November 9, 2011.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 99 The Heritage Foundation | heritage.org/BlueprintForBalance $100 DISCRETIONARY SAVINGS IN MILLIONS21 CJS Eliminate NASA’s Office of STEM Engagement

Formerly known as the NASA Ofce of Education, programs. In 2018, former NASA Acting Director the Ofce of STEM22 Engagement seeks to create Robert Lightfoot Jr. assured lawmakers that even if opportunities for students and the public to partic- the STEM programs were eliminated, the agency’s ipate in NASA’s work, encourage students to engage focus on education would not change and that many in STEM careers through learning experiences with educational programs were funded through other NASA, and strengthen public understanding of ofces and would not be afected. Additionally, the NASA’s mission and work. overall impact of the Ofce of STEM Engagement cannot be gauged because there are not enough The activities undertaken by the Ofce of STEM available data on its efectiveness to serve as a basis Engagement duplicate those of other NASA for judgment.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

100 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $105 DISCRETIONARY SAVINGS IN MILLIONS23 CJS

Eliminate NASA’s WFIRST Space Telescope

The Wide Field Infrared Survey Telescope WFIRST has a budget of $3.2 billion, but that (WFIRST) is a planned NASA observatory designed number could soar, and the launch date could be to conduct research in the areas of dark energy, exo- delayed. Given that the Webb telescope has not planets, and astrophysics. The project was approved even launched yet, Congress should redirect these for development in 2016 and is scheduled to launch funds to other priorities instead of building another in the mid-2020s. It comes on the heels of the James space telescope. Webb Space Telescope, which after two decades still has not launched and so far has cost taxpayers $10 billion.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 101 The Heritage Foundation | heritage.org/BlueprintForBalance $273 DISCRETIONARY SAVINGS IN MILLIONS24 CJS Eliminate National Oceanic and Atmospheric Administration Grants and Education Programs Congress should eliminate funding for National Federal grants are often poorly targeted and are not Oceanic and Atmospheric Administration Grants likely to have a signiﬁcant impact on meaningful and Education programs, which cost American oceanic research. Taxpayers should be insulated taxpayers millions of dollars a year. These grants from costly programs that lack constitutional or are awarded on a competitive basis to public school practical justiﬁcation and are easily leveraged for districts and are used to support environmental and political purposes. climate-related instruction and activities.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

102 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 CJS

103 , GAO-12-873, , GAO-12-873, FY , p. CEN-19, CEN-19, , p. FY 2019 Budget and Performance and Performance Budget FY 2019 , September 15, 2017, 2017, 15, , September Fiscal 2019 Budget of the United States States the United of Budget 2019 Fiscal A Review of the Operations of the Voting the Voting of the Operations of A Review , updated March 15, 2018, 2018, 15, March , updated , https://www.justice.gov/jmd/page/file/1034336/download , https://www.justice.gov/jmd/page/file/1034336/download U.S. News & World Report & World News U.S. . Heritage experts assume that FY 2019 spending remains constant in FY 2020. in FY 2020. constant spending remains FY 2019 that assume . Heritage experts A FEDERAL BUDGET FOR FISCAL YEAR 2020 , p. 91, https://www.whitehouse.gov/wp-content/uploads/2018/02/msar-fy2019.pdf (accessed (accessed 91, https://www.whitehouse.gov/wp-content/uploads/2018/02/msar-fy2019.pdf , p. orts to Assist Small Minority Owned Businesses Small Minority Assist to orts f E Federal Contracting: Government , GAO-02-309, March 2002, p. 10, https://www.gao.gov/assets/240/233527.pdf (accessed March 22, 2019). March (accessed https://www.gao.gov/assets/240/233527.pdf 10, p. 2002, March , GAO-02-309, , March 2013, p. 257, https://oig.justice.gov/reports/2013/s1303.pdf (accessed March 23, 2019). March (accessed https://oig.justice.gov/reports/2013/s1303.pdf 257, p. 2013, , March Justice Impact Evaluations: One Byrne Evaluation Was Rigorous: All Reviewed Violence Against Women Women Against Violence All Reviewed Rigorous: Was Evaluation One Byrne Evaluations: Impact Justice heritage.org/BlueprintForBalance Blueprint for Balance: FY 2019 Performance Budget: Congressional Justification Congressional Budget: Performance FY 2019 U.S. Census Bureau’s Budget: Fiscal Year 2019, As Presented to the Congress, February 2018 February the Congress, to As Presented 2019, Year Fiscal Budget: Bureau’s Census U.S. ., 694 F.3d 1377, 1381 (Fed. Cir. 2012). Cir. 1381 (Fed. 1377, F.3d ., 694 https://www2.census.gov/about/budget/FY-2019-Congressional-Budget-Submission.pdf (accessed March 23, 2019). Heritage experts Heritage experts 23, 2019). March (accessed https://www2.census.gov/about/budget/FY-2019-Congressional-Budget-Submission.pdf https://www.justice.gov/doj/fy-2019-budget-and-performance-summary (accessed March 23, 2019). Heritage experts assume that FY 2019 FY 2019 that assume experts Heritage 23, 2019). March (accessed https://www.justice.gov/doj/fy-2019-budget-and-performance-summary ce-review-of-local-police (accessed (accessed fce-review-of-local-police https://www.usnews.com/news/national-news/articles/2017-09-15/justice-department-ends-cops-o in Exhibit 10, “Department of Commerce, U.S. Census Bureau, Current Surveys and Programs—Discretionary BA, Program Program BA, and Programs—Discretionary Surveys Current Bureau, Census U.S. of Commerce, “Department in Exhibit 10, in Table, “U.S. Department of Justice: Summary of Budget Authority by Appropriation,” in U.S. Department of Justice, of Justice, Department in U.S. Appropriation,” by Authority Summary of Budget of Justice: Department “U.S. in Table, March 23, 2019). Heritage experts assume that FY 2019 savings remain constant in FY 2020. constant remain savings FY 2019 that assume Heritage experts 23, 2019). March Forfeiture Program, Program, Forfeiture Department of Justice: Summary of Budget Authority by Appropriation,” in U.S. Department of Justice, of Justice, Department in U.S. Appropriation,” by Authority Summary of Budget of Justice: Department March 23, 2019). March the household survey appropriations. the household survey ce for Victims of Victims for Ofce Programs, of Justice Ofce of Justice, Department See U.S. in the fund as of 2018. money in unobligated billion” $12 September 2012, http://www.gao.gov/assets/650/648985.pdf (accessed March 23, 2019). March (accessed http://www.gao.gov/assets/650/648985.pdf 2012, September U.S. Administration, and Statistics Economics of Commerce, Department in U.S. Obligations,” Direct and Performance: of uses 10 percent measure poverty the annual supplemental that and estimate in FY 2020 constant spending remains FY 2019 that assume Savings equal a 33 percent reduction in FY 2020 spending. in FY 2020 reduction equal a 33 percent Savings State and Local Law Enforcement Assistance and $287 million for Juvenile Justice Programs. Justice Juvenile million for $287 and Assistance Enforcement Law and Local State Census Bureau, Bureau, Census Crime, “About OVC: Crime Victims Fund,” https://www.ovc.gov/about/victimsfund.html (accessed March 23, 2019). All $12 billion represents billion represents All $12 2019). 23, March (accessed https://www.ovc.gov/about/victimsfund.html Fund,” Crime Victims OVC: “About Crime, spending remains constant in FY 2020. Savings equal a 33 percent reduction in FY 2020 spending. in FY 2020 reduction equal a 33 percent Savings 2020. in FY constant spending remains one-time savings. (accessed March 23, 2019). March (accessed (accessed March 23, 2019). All $666 million represents one-time savings. All $666 million represents 23, 2019). March (accessed (accessed March 23, 2019). Heritage experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume Heritage experts 23, 2019). March (accessed ce Review of Police,” of Police,” Review Ofce Ends COPS Department “Justice Alan Neuhauser, ce of Management and Budget, and Budget, of Management based on Ofce are FY 2020 million for of $100 savings Estimated and mathematics. engineering, technology, Science, Estimated savings of $6.2 million for FY 2020 are based on the estimated base FY 2019 level of $62 million as specified of $62 level base FY 2019 based on the estimated are FY 2020 of $6.2 million for savings Estimated Estimated savings of $35 million for FY 2020 are based on the FY 2019 DOJ requested level of $106 million as reported in Table, “U.S. “U.S. in Table, million as reported of $106 level requested DOJ based on the FY 2019 are FY 2020 million for of $35 savings Estimated Estimated savings of $304 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.J.Res. 31, Consolidated 31, Consolidated in H.J.Res. as specified level appropriated based on the FY 2019 are FY 2020 of $304 million for savings Estimated Estimated savings of $265 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.J.Res. 31, Consolidated 31, Consolidated as specified in H.J.Res. level appropriated based on the FY 2019 are FY 2020 million for of $265 savings Estimated 31, Consolidated as specified in H.J.Res. level appropriated based on the FY 2019 are FY 2020 of $40 million for savings Estimated Estimated savings of $140 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.J.Res. 31, Consolidated 31, Consolidated as specified in H.J.Res. level appropriated based on the FY 2019 are FY 2020 million for of $140 savings Estimated 31, Consolidated as specified in H.J.Res. level appropriated based on the FY 2019 are FY 2020 million for of $495 savings Estimated ce of Justice Programs Crime Victims Fund web site, which lists “over “over which lists site, web Fund Crime Victims Programs of Justice Ofce the DOJ from come FY 2020 billion for of $12 savings Estimated U.S. Department of Commerce, International Trade Administration, “The International Buyer Program,” https://www.trade.gov/cs/ibp.asp https://www.trade.gov/cs/ibp.asp Program,” Buyer International “The Administration, Trade International of Commerce, Department U.S. Ofce, Accountability Government U.S. Estimated savings of $666 million represents the estimated FY 2019 unobligated balance as reported in U.S. Department of Justice, Asset Asset of Justice, Department in U.S. reported as balance unobligated 2019 FY the estimated of $666 million represents savings Estimated Estimated savings of $15.5 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.J.Res. 31, Consolidated 31, Consolidated as specified in H.J.Res. level appropriated based on the FY 2019 are 2020 FY million for of $15.5 savings Estimated Estimated savings of $49 million for FY 2020 are based on the FY 2019 DOJ requested level of $148 million as reported reported million as of $148 level requested DOJ based on the FY 2019 are FY 2020 million for of $49 savings Estimated Estimated savings of $498 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.J.Res. 31, Consolidated 31, Consolidated as specified in H.J.Res. level appropriated based on the FY 2019 are FY 2020 million for of $498 savings Estimated Evans v. U.S v. Evans Estimated savings of $415 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.J.Res. 31, Consolidated 31, Consolidated as specified in H.J.Res. level appropriated 2019 based on the FY are FY 2020 for million of $415 savings Estimated ce of the Inspector General, Oversight and Review Division, and Review Oversight General, of the Inspector Ofce of Justice, Department U.S. ce, Ofce, Accounting General U.S. Estimated savings of $1.77 billion for FY 2020 are based on the FY 2019 appropriated level as specified in H.J.Res. 31, Consolidated 31, Consolidated as specified in H.J.Res. level appropriated based on the FY 2019 are FY 2020 billion for of $1.77 savings Estimated Section of the Civil Rights Division Rights the Civil of Section Appropriation by Summary Information Two: Part Summary, Government: 2019 Major Savings and Reforms and Major Savings 2019 Government: ce Evaluations Were Problematic Were Evaluations Ofce 2019 Budget and Performance Summary, Part Two: Summary Information by Appropriation by Information Summary Two: Part Summary, and Performance Budget 2019 Appropriations Act, 2019. Heritage experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume Heritage experts 2019. Act, Appropriations in FY 2020. constant spending remains FY 2019 that assume Heritage experts 2019. Act, Appropriations Appropriations Act, 2019. Heritage experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume experts Heritage 2019. Act, Appropriations in FY 2020. constant spending remains FY 2019 that assume Heritage experts 2019. Act, Appropriations Appropriations Act, 2019. Heritage experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume experts Heritage 2019. Act, Appropriations Appropriations Act, 2019. Heritage experts assume that FY 2019 spending remains constant in FY 2020. in FY constant remains spending FY 2019 that assume Heritage experts 2019. Act, Appropriations Appropriations Act, 2019. Heritage experts assume that FY 2019 spending remains constant in FY 2020. Savings include $1.486 billion for billion for $1.486 include Savings 2020. in FY constant remains spending FY 2019 that assume Heritage experts 2019. Act, Appropriations 2020. in FY constant remains spending FY 2019 that assume Heritage experts 2019. Act, Appropriations Appropriations Act, 2019, Public Law 116-6, 116th Cong., February 15, 2019, https://www.congress.gov/116/bills/hjres31/BILLS-116hjres31enr.pdf https://www.congress.gov/116/bills/hjres31/BILLS-116hjres31enr.pdf 2019, 15, February Cong., 116th 116-6, Law Public 2019, Act, Appropriations

8. 5. 6. 9. ENDNOTES 19. 17. 18. 15. 16. 14. 13. 11. 12. 10. 1. 22. 21. 20. 2. The Heritage Foundation | 3. 7. 4. CJS 104 The Heritage Foundation | Foundation Heritage The 24. 23.

Government: 2019 MajorSavings andReforms Government: 2019 MajorSavings andReforms Estimated savings of$105 millionfor FY2020 are basedonOfce ofManagement andBudget, Estimated savings of$273 millionfor FY2020 are basedonOfce ofManagement andBudget, Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance , p. 92. Heritageexperts assume that FY2019 savings remain constant inFY2020. , p. 21.Heritageexperts assume that FY2019 savings remain constant inFY2020. A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A Fiscal 2019 Budget of theUnited States Fiscal 2019 Budget of theUnited States Defense The Heritage Foundation | heritage.org/BlueprintForBalance $431 DISCRETIONARY SAVINGS IN MILLIONS1

Cut Non-Defense Research from the Defense Department Budget

The Congressionally Directed Medical Research inception, breast cancer has been the most heavily Programs (CDMRP) is one of the oldest and largest funded research area, with over $3.6 billion. DEFENSE examples of non-defense funding inside the DOD budget. It was started by Congress in FY 1992 with In FY 2019 alone, Congress appropriated $1.4 billion an appropriation of $25 million for breast cancer to support all Congressionally Directed Research research. Some of this funding goes to medical Programs, including such non-defense medical research for issues like post-traumatic stress or issues as breast, ovarian, and prostate cancer; orthotics that are relevant to the DOD, but that is epilepsy; and autism.2 The funding for non-defense not always the case. In the years since the program’s research should be eliminated.

ADDITIONAL READING " Senator Tom A. Coburn, Department of Everything: Department of Defense Spending That Has Little to Do with National Security, November 2012. " Frederico Bartels, ed., “The Role of the 2020 National Defense Authorization Act (NDAA) in Rebuilding the U.S. Military,” Heritage Foundation Special Report No. 208, February 6, 2019.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

106 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $253 DISCRETIONARY SAVINGS IN MILLIONS3

Combine Military Exchanges and Commissaries

and Reduce Commissary Subsidies DEFENSE The DOD operates two parallel but similar organi- self-sustaining, relying on revenue from their sales zations that provide access to goods and services for rather than on direct appropriations. servicemembers and their families. The commissaries provide groceries at cost plus 5 percent, which In debates over the 2018 National Defense Autho- is sustainable only through an annual subsidy. In rization Act, Congress included a reporting FY 2019, Congress subsidized the commissaries at requirement that would provide a cost-beneﬁt almost $1.3 billion.4 analysis and aim to reduce the operational costs of commissaries and exchanges by $2 billion. Con- The DOD currently has an extensive and separate gress should revisit this question and continue to retail network to serve military personnel and their consider ways to reform these systems. This is espe- dependents. Maintaining access to afordable gro- cially important at a time when the Government ceries and goods is important for servicemembers, Accountability Ofce has found that the DOD does particularly those who are stationed overseas or in not properly measure the beneﬁts created by these remote locations. The military has three separate systems.5 general-retail stores (exchanges). All three are

ADDITIONAL READING " Mackenzie Eaglen and Julia Pollack, “How to Save Money, Reform Processes, and Increase Efciency in the Defense Department,” Heritage Foundation Backgrounder No. 2507, January 10, 2011. " Congressional Budget Ofce, Reducing the Deﬁcit: Spending and Revenue Options, March 2011.

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces subsidies for commissary operations. INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 107 The Heritage Foundation | heritage.org/BlueprintForBalance $147 DISCRETIONARY SAVINGS IN MILLIONS6

Close Domestic Dependent Elementary and Secondary Schools

Congress should create real choice for military The current system focuses on the needs of a minus- families and transition the Domestic Dependent cule minority to the detriment of the majority of DEFENSE Elementary and Secondary Schools system into a its population. system of education savings accounts for military families. The current DDESS system serves only 4 There is no need for the military to operate schools percent of military-connected children;7 80 percent in the United States. The Pentagon should act of military-connected children attend traditional promptly to close these schools and transfer mili- public schools. Additionally, over one-third of ser- tary dependents to local school systems, a process vicemembers consider their children’s schooling a that the Trump Administration has initiated.9 deciding factor in continuing their military careers.8

ADDITIONAL READING " Lindsey M. Burke and Anne Ryland, “A GI Bill for Children of Military Families: Transforming Impact Aid into Education Savings Accounts,” Heritage Foundation Backgrounder No. 3180, June 2, 2017. " National Commission on Fiscal Responsibility and Reform, “$200 Billion in Illustrative Savings: 2015 Savings,” draft document, undated.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

108 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $3.9 DISCRETIONARY SAVINGS IN BILLIONS10

Reform Military Health Care DEFENSE Congress should reform the DOD’s current TRI- options for members of military families while CARE system and introduce a private-sector health also reducing costs. A 2011 Heritage Foundation insurance option for members of military families. report proposed moving servicemembers and their This would give servicemembers and their families dependents to the system currently used by civilian more choices and serve as a competition catalyst federal employees, which would save $1.4 billion in for the current TRICARE system. The Military the first year and significantly more in future years.12 Compensation and Retirement Modernization The January 2015 final report of the congressionally Commission assessed that “[t]he quality of TRI- chartered Military Compensation and Retirement CARE benefits as experienced by Service members Modernization Commission recommended that and their families has decreased, and fiscal sustain- military dependents be allowed to choose from a ability of the program has declined.”11 selection of commercial health insurance plans and estimated that this would save $3.90 billion in the Implementing a private-sector health insurance first year and more in the future.13 system would dramatically increase access and

ADDITIONAL READING " Baker Spring, “Saving the American Dream: Improving Health Care and Retirement for Military Service Members and Their Families,” Heritage Foundation Backgrounder No. 2621, November 17, 2011. " “Appendix D: Cost Data,” in Military Compensation and Retirement Modernization Commission, Report of the Military Compensation and Retirement Modernization Commission: Final Report, January 2015.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 109 The Heritage Foundation | heritage.org/BlueprintForBalance $9.0 DISCRETIONARY SAVINGS IN BILLIONS14

Increase Use of Performance-Based Logistics

Congress should incentivize and enable the broader with the proper functioning of that platform.16 use of Performance-Based Logistics throughout the This serves to align the contractor’s interests with DEFENSE acquisition process. The Department of Defense the DOD’s interest in maintaining the readiness should increase the use of PBL in weapon-systems of platforms. maintenance and sustainment. It is estimated that these arrangements could save between $9 billion PBL is not appropriate for all systems and should and $32 billion a year.15 PBL is an arrangement in be applied judiciously. It is both DOD policy and which the contractor is responsible for a larger a priority for product-support solutions, and it is portion of the support throughout the life cycle of estimated that it saves between 5 percent and 20 the product. Thus, instead of being associated with percent of contract costs.17 the delivery of a platform, a contract is associated

ADDITIONAL READING " Baker Spring, “Performance-Based Logistics: Making the Military More Efcient,” Heritage Foundation Backgrounder No. 2411, May 6, 2010. " Mackenzie Eaglen and Julia Pollack, “How to Save Money, Reform Processes, and Increase Efciency in the Defense Department,” Heritage Foundation Backgrounder No. 2507, January 10, 2011.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

110 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $0 DISCRETIONARY (NO SAVINGS)18

Reduce Excess Infrastructure DEFENSE According to recent DOD estimates, the military has authority every year, and Congress has rejected approximately 19 percent excess capacity, ranging it every year. Both the Senate and the House from 6 percent in the Navy to 29 percent in the drafted versions of BRAC when discussing the 2018 Army.19 As the military grows, it is not likely to need National Defense Authorization Act, but none of the the same types of facilities it now has. As it stands, proposals ever made it into the legislation. the DOD may not even thoroughly analyze its infrastructure needs.20 As it works to expand the military, Congress should allow the DOD to conduct a rigorous and transpar- Congress routinely blocks the DOD’s eforts to ent review of its current and future infrastructure right-size its infrastructure. The last time the DOD needs, including the closing of bases and facilities as was able to shape its infrastructure footprint was appropriate. While this process will come with an during the 2005 Base Realignment and Closure up-front cost, the DOD estimates that it could save round. Since 2012, the DOD has asked for BRAC $2 billion annually once it is fully implemented.21

ADDITIONAL READING " Frederico Bartels, “Guidelines for a Better—and Necessary—Round of BRAC,” Heritage Foundation Backgrounder No. 3257, October 19, 2017. " Diana Cahn, “Policy Experts Urge Congress to Back New Round of Base Realignments and Closures,” Stars and Stripes, June 19, 2017.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 111 The Heritage Foundation | heritage.org/BlueprintForBalance $434 DISCRETIONARY SAVINGS IN MILLIONS22

Reform the Basic Allowance for Housing

For FY 2019, the DOD requested $21.7 billion in These changes would reduce costs and are com- Basic Allowance for Housing for both enlisted per- pletely appropriate. Congress should phase in more DEFENSE sonnel and ofcers.23 Congress needs to reform the accurate housing allowances, because the BAH is rules for the BAH and restore it to its proper role as designed solely to help servicemembers pay for an allowance by requiring married military couples accommodations. A U.S. Army Audit Agency report to share a single allowance and requiring all service- estimated that married servicemembers receive members to document their housing expenditures $200 million more in BAH than their actual housing in order to receive the allowance. Servicemembers costs.24 Congress should phase in more accurate are not entitled to and should have no expectation housing allowances beginning with the FY 2019 that money above what they pay for housing can be National Defense Authorization Act. This would retained as “extra compensation.” save an estimated $434 million in FY 2020.

ADDITIONAL READING " Frederico Bartels, ed., “The Role of the 2020 National Defense Authorization Act (NDAA) in Rebuilding the U.S. Military,” Heritage Foundation Special Report No. 208, February 6, 2019. " Leo Shane III, “Group Wants Lawmakers to Cap Military Housing Stipends to Curb Costs,” Military Times, March 29, 2017.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

112 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $880 DISCRETIONARY SAVINGS IN MILLIONS25

Replace Military Personnel in Commercial

Positions with Civilian Employees DEFENSE The DOD currently employs approximately 340,000 usually spends on a job. According to the CBO, the active-duty military personnel to perform support savings would be generated because of two factors: functions in commercial positions. Some of these On average, civilians are 30 percent less expensive, positions can be transformed into civilian positions and fewer civilians than the number of military per- without losing the possibility of allocating military sonnel can be employed in the same positions.27 personnel to commercial positions to enable them to rotate away from combat positions. The Congres- The savings vary depending on the replacement rate sional Budget Ofce has analyzed the possibility of that the DOD achieves. In similar earlier initiatives, transforming 80,000 of these positions.26 the DOD was able to average a ratio of 1:1.5, with two civilians replacing three military personnel. Even Military personnel are inherently more expensive a replacement ratio of 1:1 would save $3.1 billion than civilians because the required training and annually. At a ratio of 1:1.5, the amount would reach rotations are shorter than the time that a civilian $5.7 billion.

ADDITIONAL READING " Congressional Budget Ofce, Replacing Military Personnel in Support Positions with Civilian Employees, December 2015.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 113 DEFENSE National Defense Authorization Act requiredtheSecretaryNational DefenseAuthorization ofDefensetodevelop Act aplanto“reducethe Public Law 112-81directedthatDODfinancialstatements wouldhave tobe“validatedasreadyforauditno DOD facilitiesfromrenewable sourcesby 2025. Thismandate,whichisforcingthePentagon toexpendever 114 Code, theDefenseDepartmentisobligatedtoproduceorprocure25percentofenergyconsumedin Congress torevisitCircularA-76 theissue. andengage forFY2010,325 oftheNationalDefenseAuthorization Act would allow theautomaticandimmediateexportoffollow-on parts, components, servicing,ortechnical which couldprovide morecost-efective servicesfortheU.S. government. Thismoratoriumextends to POLICY RIDERS later thanSeptember 30, 2017.” more resourcesonrenewable energyratherthanonmilitarycapability, shouldbeendedimmediately. marketplace diversity by underminingtheincentives forproducersofrenewable energytodevelop undergoing financialauditchoosetodoso.undergoing this factandensurethatitsexemption isupdatedtoshow thependingcompletion ofexport-controlreform to refusewithinaspecifiedandlimitedtimeperiod thesystem-level licensingofsuchexports, which trillion worthofitstangibleassets, includingdecades-oldequipmentlike M113armoredpersonnelcarriers that leadtoactualreducedwaste arerare,andmany orinefciency companiesthatcanlegallyescape that openingsupportservicesforthemilitarytoprivatecompetition couldresultinsavings ofbetween 30 the greatest singledriver ofperformanceandcost improvement.” and toremove any other impediments discovered in thecourseofpreparingplan. audit construct asappliedtothedepartmentisrequirementreportpreciselyvalueofall$2.4 as “waste audits”orzero-basedbudgeting techniques. Inaddition,many oftheauditrequirementsimposed accomplish thepurposeofanauditatalower cost. Section1003ofPublicLaw 111-84 andSection1003of Develop cost-efective auditingoftheDepartmentDefense. Lift themoratoriumonpublic–privatecompetitions. Do not imposerenewable energymandatesintheDepartmentofDefense. competitively pricedproducts. Fuel isasmuchanasset asitisapointofvulnerabilityforthemilitary. To on privatecorporationsmake little sensewhenappliedtotheDOD. Anexampleoftheillogicfinancial competitions remainprohibitedunderSection cannot oferitsservicestotheinstallation. DOD-specific The Heritage Foundation | Foundation Heritage The should includeallowing alldefense-relatedexportstobelicensedtheseclosealliesabsentaU.S. decision sector, not intheDOD. since 2012, Congresshasprohibitedcompetition between publicandprivateorganizationstodetermine specific mandatesfromthemilitary. percent and60percent. public–public competitions, whichleadstosituationsinthemunicipalitywhereabaseislocated protect taxpayers fromundueDODenergyexpense,Congressshouldremove technology-specific andfuel- plans. CanadaisalreadytreatedseparatelyunderU.S. law, andtheSecretary ofDefense’s planshouldreflect purchased inthe1970sandbuildingsconstructed hundredsofyearsago. Support theseamlessintegrationofnational technologyandindustrial base. for theU.S. toexportdefensetechnologiesitsclosest allies, andAustralia. theUnitedKingdom These barriers totheseamlessintegration”ofNTIB. been updatedandhasyieldedproblemsforboth government andtheprivate sector. Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance 32 Thecommoncriticismleveled against suchcompetition isthat theprocesshasnot 34 TheDODhasstated thatitisnow ofcially“underaudit.” Audit results 28 Inparticular, underSection2911(e)ofTitle10theUnited States A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A 35 Therearebetter methods toreducewaste orinefciency, such 37 Congressshouldsupportreformsthatwillmake iteasier Under pressurefromfederalemployee unions 30 yet even criticswilladmitthat“competition is 31 TheRANDCorporationhasestimated Congress shouldexamineways to 36 Thismakes senseintheprivate Such mandatesimpede 33 Thisismorereasonfor The FY2017 29 DEFENSE

115 Empowering all Empowering Moreover, Congress can repurpose existing repurpose existing Congress can Moreover, 38 ESAs can improve education options for military children for education options ESAs can improve 39 A FEDERAL BUDGET FOR FISCAL YEAR 2020 heritage.org/BlueprintForBalance Blueprint for Balance: because they meet the unique needs of military families. the unique needs of military because they meet federal revenue sources, such as Impact Aid or other titles in the Elementary and Secondary Education Act, the Elementary and Secondary Education titles in Aid or other such as Impact sources, federal revenue families who serve with school choice would ensure that their children do not face mandatory assignment to face mandatory not their children do would ensure that school choice with serve families who support from 75 percent of active-duty military families. of active-duty support from 75 percent Establish education savings accounts (ESAs) for military-connected children. military-connected (ESAs) for accounts education savings Establish to fund ESAs for children of military families. to fund ESAs for children that are the right fit for their children wherever their next assignment takes them. ESAs have garnered have them. ESAs takes assignment their next children wherever right fit for their that are the the nearest district school. Providing military parents with ESAs would allow them to find education options education options them to find allow with ESAs would military parents school. Providing district the nearest The Heritage Foundation | DEFENSE 116 4. 7. 3. The Heritage Foundation | Foundation Heritage The 2. 17. 16. 15. 14. 13. 12. 11. 10. 1. ENDNOTES 9. 6. 5. 8.

“Performance Logistics Based andProject Proof Point: AStudy ofPBLEfectiveness,” Jacques S.Gansler, William Lucyshyn, LisaH.Harrington, andAmeliaCotton Corl, January 2015, pp. 79–119, https://docs.house.gov/meetings/AS/AS00/20150204/102859/HHRG-114-AS00-20150204-SD001.pdf (March Achieve Operational Efciencies Aid into Education Savings Accounts,” HeritageFoundation Commission: FinalReport (0-1), Revolving andManagement Funds (RF-1) Jim Cowen andMarcus S.Lingenfelter, “The Stealth Factor inMilitaryReadiness,” U.S. Government Accountability Ofce, Savings of$253 millionfor FY 2020 are basedontheFY2019 subsidylevel of$1.266 billionasfound inU.S. Department ofDefense, Ofce Savings of$147 millioninFY2020 are basedontheFY2019 estimated spendinglevel of$589 millionfor DDESS asfound inU.S. House Report No. 115-874, Lindsey M.Burke andAnneRyland,“A GIBillfor Children ofMilitaryFamilies: Transforming Impact Daniel Gouré, “Performance-Based Logistics Contracts Continue to Prove Their Value,” Lexington Institute, January 17, 2014, Military Compensation andRetirement Modernization Commission, Ibid., p. 81. U.S. Department ofDefense, Assistant Secretary ofDefense, Logistics &Materiel Readiness, Baker Spring,“Performance-Based Logistics: MakingtheMilitaryMore Efcient,” HeritageFoundation Savings of$9 billionfor FY2020 represent thelow endofarange ofestimated savings from two reports: JohnBoyce andAllanBanghart, Baker Spring,“Saving theAmericanDream: Improving HealthCare andRetirement for MilitaryService Members andTheir Families,” Estimated savings of $3.90 billionfor FY2020 are basedonimplementation ofRecommendation 6asoutlinedinMilitaryCompensation Savings of$431.3 millionfor FY2020 include$265.6 millionfor CDMRPand$165.7 millionfor civilmilitaryprograms. CDMRP Karen Jowers, “Pentagon May Stop RunningStateside Schoolsfor MilitaryChildren,” U.S. Department ofDefense, Congressionally Directed MedicalResearch Programs, “About Us:Funding History,” last updated December 14, (accessed March 15, 2019). (Comptroller), 2020, withthat figure growing to $32 billionperyear over the10-year period. 2012, pp. 26–30, https://www.dau.mil/library/defense-atl/DATLFiles/Mar_Apr_2012/boyce_bangheart.pdf (accessed March 15, 2019), and 2018, http://cdmrp.army.mil/about/fundinghistory (accessed March 14, 2019). dream-improving-health-care-and-retirement-for-military-service-members. cancer asreported inU.S. Department ofDefense, U.S. Army MedicalResearch andMateriel Command, Congressionally Directed of theUnderSecretary ofDefense (Comptroller), savings are basedonFY2018 spendinglevels for research onautism,breast cancer, epilepsy, ovarian cancer, andprostate 15, 2019). The commission estimated that thisproposal would save $3.90 billioninthefirst year andmore than$6billionperyear once Funds (RF-1) PBL Guidebook Public–Private Partnerships for Depot-Level Maintenance: Operating Outcomes, Models, andIssues Operation_and_Maintenance/O_M_VOL_1_PART_1/DoDDE_OP-5.pdf (accessed March 15, 2019). This estimate assumes aphased-in are basedonFY2020 requested levels of$165.7 asreported inU.S. Department ofDefense, Ofce oftheUnderSecretary ofDefense and Retirement Modernization Commission, reduction inDDESS spendingamounting to a25 percent cut inFY2020. requested subsidy. fully implemented. 5515, 115thCong., 2ndSess., July25, 2018, p. 767, https://www.congress.gov/115/crpt/hrpt874/CRPT-115hrpt874.pdf (March 15, 2019). Heritage experts conservatively assume that theDODwould initiallyrealize thelowest range ofthese savings at $9 billionperyear inFY March 15, 2019). The estimates ofcost savings range from anotablyconservative orlow level of$9 billionperyear to $32 billionperyear. Policy, Center for Policy Public andPrivate Enterprise, October 2010, http://cpppe.umd.edu/file/861/download?token=ipx2r1Sr (accessed Heritage Foundation February 2018, p. DoDDE-370, http://comptroller.defense.gov/Portals/45/Documents/defbudget/fy2019/budget_justification/pdfs/01_ Department ofDefense, March 14, 2019). Medical Research Programs, http://acqnotes.com/wp-content/uploads/2017/07/Performance-Based-Logistics-Guidebook-March-2016.pdf (accessed March 15, 2019). http://www.lexingtoninstitute.org/performance-based-logistics-contracts-continue-to-prove-their-value/ (accessed March 15, 2019). http://www.heritage.org/defense/report/performance-based-logistics-making-the-military-more-efcient. https://www.militarytimes.com/newsletters/pay-benefits/2017/11/13/pentagon-may-stop-running-state-side-schools-for-military-children/ http://thehill.com/blogs/congress-blog/education/321321-the-stealth-factor-in-military-readiness (accessed March 15, 2019). http://www.heritage.org/education/report/gi-bill-children-military-families-transforming-impact-aid-education-savings. https://cdmrp.army.mil/pubs/annreports/2018annrep/2018annreport.pdf (accessed March 14, 2019). Savings incivilmilitaryprograms , March 2019, p. 28A,https://comptroller.defense.gov/Portals/45/Documents/defbudget/fy2020/fy2020_o1.pdf (accessed Department of Defense Budget, Fiscal Year 2020: Operation andMaintenance Programs (0-1), Revolving andManagement : A Guideto Developing Performance-Based Arrangements Backgrounder Blueprint for Balance: Blueprint for Fiscal Year (FY)2019 President’s Budget: Operation andMaintenance, Defense-Wide, DoDDependents Education heritage.org/BlueprintForBalance , p. 262. John S.McCain National Defense Authorization Act for Fiscal Year 2019 Congressionally Directed Medical Research Programs: 2018 AnnualReport , GAO-17-80, March 2017, https://www.gao.gov/products/GAO-17-80 (accessed March 15, 2019). No. 2621, November 17, 2011, http://www.heritage.org/research/reports/2011/11/saving-the-american- Defense Commissaries: DODNeedsto Improve Business Processes to Ensure Patron Benefits and Report of theMilitary Compensation andRetirement Modernization Commission: FinalReport , p. 6.The $253 millioninsavings represents a20percent reduction inthe$1.266 billion Department of Defense Budget, Fiscal Year 2020: Operation andMaintenance Programs A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A Backgrounder Report of theMilitary Compensation andRetirement Modernization No. 3180, June2,2017, , 2016, p. 12, The Hill The Current State of Performance Logistics Based and Military Times Defense AT&L: Product SupportIssue , February 27, 2017, , Conference Report to Accompany H.R. , November 14, 2017, , University ofMaryland,SchoolPublic Backgrounder , September 30, 2018, No. 2411, May 6,2010, , March–April , , DEFENSE

117 , March 2019, p. 17A, p. 2019, , March , December 2015, 2015, , December , February 2016, 2016, , February No. 3299, June 22, 2011, June 22, 2011, 3299, No. , February 2016, p. 2-4, 2-4, p. 2016, , February , January 29, 2018, 2018, , January 29, , January 4, 2017, 2017, , January 4, WebMemo The CPA Journal CPA The Commentary Department Department , Committee on Armed Services, U.S. Senate, 114th Cong., 114th Cong., Senate, U.S. on Armed Services, , Committee , October 2017, p. 3, p. 2017, , October Government Executive Government , May 2017, p. 22A, p. 2017, , May , December 25, 2017, 2017, 25, , December No. 4643, January 4, 2017, 2017, January 4, 4643, No. National Interest National

Issue Brief Issue A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Personnel Savings in Competitively Sourced DoD Activities: Are They They Are DoD Activities: Sourced in Competitively Savings Personnel Replacing Military Personnel in Support Positions with Civilian Employees in Support Positions Personnel Military Replacing , January 16, 2013, https://fas.org/sgp/crs/misc/R40854.pdf (accessed March 15, 2019). 15, March (accessed https://fas.org/sgp/crs/misc/R40854.pdf , January 16, 2013, Department of Defense Budget, Fiscal Year 2020: Military Personnel Programs (M-1) Programs Personnel Military 2020: Year Fiscal Budget, Defense of Department Department of Defense Infrastructure Capacity Infrastructure Defense of Department National Defense Authorization Act for Fiscal Year 2017 Year Fiscal for Act Authorization Defense National heritage.org/BlueprintForBalance Blueprint for Balance: (Santa Monica, CA: RAND Corporation, National Defense Research Institute, 2000), Institute, Research Defense National Corporation, RAND Monica, CA: (Santa Report for Congress for Report Defense Budget Overview: United States Department of Defense Fiscal Year 2017 Budget Request Budget 2017 Year Fiscal Defense of Department States United Overview: Budget Defense https://www.heritage.org/education/commentary/gi-bill-children-military-families. cient-expensive/ (accessed March 15, 2019). 15, March (accessed fcient-expensive/ https://www.cpajournal.com/2016/02/01/audits-become-ine 2018). April 17, (accessed ordable-pentagon-audit-23784 f http://nationalinterest.org/feature/the-una 2019). 15, March (accessed https://www.gpo.gov/fdsys/pkg/PLAW-114publ328/pdf/PLAW-114publ328.pdf https://www.rand.org/content/dam/rand/pubs/monograph_reports/2007/MR1117.pdf (accessed March 15, 2019). 15, March (accessed https://www.rand.org/content/dam/rand/pubs/monograph_reports/2007/MR1117.pdf 2019). 15, March (accessed http://archive.defense.gov/news/newsarticle.aspx?id=122263 http://www.heritage.org/defense/report/the-new-administrations-policy-should-reflect-biofuels-cannot-meet-military-needs. http://www.heritage.org/research/reports/2011/06/capability-not-politics-should-drive-dod-energy-research. 2019). 14, March (accessed https://www.gpo.gov/fdsys/pkg/PLAW-111publ84/pdf/PLAW-111publ84.pdf March (accessed http://www.govexec.com/excellence/promising-practices/2017/01/its-time-bury-76it-worked-once-its-day-past/134305/ by $880 million each year until year five, when total annualized savings reach the midpoint—$4.4 billion—of the CBO’s estimated estimated billion—of the CBO’s the midpoint—$4.4 reach savings annualized when total five, year until $880 million each year by 2019). 15, March (accessed https://www.cbo.gov/publication/51012 http://comptroller.defense.gov/Portals/45/Documents/defbudget/fy2018/fy2018_m1.pdf (accessed March 15, 2019). 15, March (accessed http://comptroller.defense.gov/Portals/45/Documents/defbudget/fy2018/fy2018_m1.pdf ce of the Under Ofce of Defense, Department See U.S. of this cost. equals 2 percent savings million in FY 2020 $434 The billion on BAH. 2019). 15, March (accessed https://comptroller.defense.gov/Portals/45/Documents/defbudget/fy2020/fy2020_m1.pdf https://1yxsm73j7aop3quc9y5ifaw3-wpengine.netdna-ssl.com/wp-content/uploads/2017/10/101717_DoD_BRAC_Analysis.pdf (accessed (accessed https://1yxsm73j7aop3quc9y5ifaw3-wpengine.netdna-ssl.com/wp-content/uploads/2017/10/101717_DoD_BRAC_Analysis.pdf http://comptroller.defense.gov/Portals/45/Documents/defbudget/fy2017/FY2017_Budget_Request_Overview_Book.pdf (accessed March March (accessed http://comptroller.defense.gov/Portals/45/Documents/defbudget/fy2017/FY2017_Budget_Request_Overview_Book.pdf ect actual housing costs, Heritage experts estimate that that estimate Heritage experts housing costs, actual ect and af behaviors change could allowances accurate and while more is uncertain, Research Service Service Research March 15, 2019). 15, March https://defense360.csis.org/bad-idea-using-a-growing-force-as-an-excuse-not-to-conduct-brac/ 13, 2018, December 360, Defense 11, http://docs.house.gov/meetings/AS/AS00/20170612/106090/HHRG-115-AS00-Bio-MattisJ-20170612.pdf p. 12, 2017, June Representatives, a phased-in approach would reduce BAH costs by 2 percent in FY 2020, rising to 8 percent in FY 2023. In FY 2018, the DOD spent $21.744 $21.744 DOD spent the In FY 2018, in FY 2023. 8 percent rising to 2020, in FY 2 percent by costs BAH reduce would a phased-in approach (Comptroller), of Defense Secretary ce of the Under Secretary of Defense (Comptroller), Chief Financial Chief (Comptroller), of Defense Secretary of the Under Ofce of Defense, Department See U.S. $2 billion annually. save would Cannot Meet Military Needs,” Heritage Foundation Heritage Foundation Military Needs,” Cannot Meet cer, Ofcer, Real? Will They Last? They Will Real? 14, 2019). 14, 15, 2019). 15, ce, Ofce, Budget Congressional savings. estimated annualized savings of between $3.1 billion and $5.7 billion. We assume savings of $880 million in the first year, increasing increasing year, million in the first of $880 savings assume billion. We $5.7 billion and $3.1 of between savings annualized estimated 2nd Sess., May 18, 2016, p. 164, https://www.congress.gov/114/crpt/srpt255/CRPT-114srpt255.pdf (accessed March 15, 2019). 15, March (accessed https://www.congress.gov/114/crpt/srpt255/CRPT-114srpt255.pdf 164, p. 18, 2016, May 2nd Sess., (accessed March 15, 2019). 15, March (accessed (accessed March 15, 2019). 15, March (accessed of Defense Budget, Fiscal Year 2018: Military Personnel Programs (M-1) Programs Personnel Military 2018: Year Fiscal Budget, Defense of Ibid., p. 3. Ibid., p. Senate Report No. 114-255, 114-255, No. Report Senate Jack Spencer, “Capability, Not Politics, Should Drive DOD Energy Research,” Heritage Foundation Heritage Foundation Research,” DOD Energy Should Drive Not Politics, “Capability, Jack Spencer, Ibid. Biofuels that Should Reflect Policy Administration’s New “The Tubb, and Katie Rachel Zissimos ce of the Under Secretary of Defense (Comptroller), (Comptroller), of Defense of the Under Secretary Ofce of Defense, Department U.S. of the CBO’s the midpoint leading to phase-in of the proposal, based on a five-year are FY 2020 of $880 million for savings Estimated Estimated savings of $434 million for FY 2020 are based on an assumed 2 percent reduction in BAH costs. While the exact level of savings of savings level the exact While costs. in BAH reduction 2 percent based on an assumed are FY 2020 for million of $434 savings Estimated Frederico Bartels, “Bad Idea: Using a Growing Force as an Excuse Not to Conduct BRAC,” Center for Strategic and International Studies, Studies, and International Strategic for Center BRAC,” Conduct Not to as an Excuse Force “Bad Idea: Using a Growing Bartels, Frederico House of U.S. on Armed Services, the Committee before testimony the Record,” for Statement “Written of Defense, Secretary James Mattis, We do not assume any savings for FY 2020. However, the Department of Defense estimates that once fully implemented, a BRAC a BRAC fully implemented, once that estimates of Defense the Department However, FY 2020. for savings any do not assume We U.S. Department of Defense, of Defense, Department U.S. cient and Expensive?” and Expensive?” Inefcient Too Become Audits “Have Radin and Miriam E. Katowitz, Arthur J. 23, 2016, December 114th Cong., 114-328, Public Law 2017, Fiscal Year for Act Authorization Defense National S. 2943, Burke and Ryland, “A G.I. Bill for Children of Military Families: Transforming Impact Aid into Education Savings Accounts.” Savings Education Aid into Impact Transforming of Military Families: Children G.I. Bill for and Ryland, “A Burke Lindsey M. Burke, “A G.I. Bill for Children from Military Families,” Heritage Foundation Heritage Foundation Military Families,” from Children G.I. Bill for “A M. Burke, Lindsey Susan M. Gates and Albert A. Robbert, and Albert A. Robbert, Susan M. Gates 2014, 15, May of Defense, Department U.S. Remain,” But Challenges Progress, Audit “DOD Makes Cheryl Pellerin, H.R. 2647, National Defense Authorization Act for Fiscal Year 2010, Public Law 111-84, 111th Cong., October 28, 2009, 28, 2009, October Cong., 111th 111-84, Public Law 2010, Fiscal Year for Act Authorization Defense National H.R. 2647, ordable Pentagon Audit,” Audit,” Pentagon ordable Unaf “The Spoehr, Tom Valerie Ann Bailey Grasso, “Circular A-76 and the Moratorium on DOD Competitions: Background and Issues for Congress,” Congressional Congressional Congress,” for and Issues Background on DOD Competitions: and the Moratorium A-76 “Circular Grasso, Ann Bailey Valerie Stan Soloway, “It’s Time to Bury A-76—It Worked Once, But Its Day Is Past,” Is Past,” Day But Its Once, Worked Bury A-76—It to Time “It’s Soloway, Stan

19. 18. 29. 26. 27. 28. 25. 24. 23. 21. 22. 20. The Heritage Foundation | 38. 39. 36. 37. 34. 35. 33. 32. 30. 31.

Energy and Water Development The Heritage Foundation | heritage.org/BlueprintForBalance $493 DISCRETIONARY SAVINGS IN MILLIONS1

Focus DOE National Nuclear Security Administration Spending on Weapons Programs

The DOE is responsible for the nuclear reactors and " Secure Transportation Asset (saves $73 million); weapons that are operated by the Defense Depart- ment. Each year, the DOE receives between $16 " Information Technology and Cyber Security billion and $17 billion to fund defense-related activi- (saves $30.3 million); ties. The U.S. must continue to fund nuclear weapons E&W modernization and implement the Trump Admin- " Warhead Dismantlement and Fissile istration’s Nuclear Posture Review. The National Materials Transparency (now under “Nuclear Nuclear Security Administration must prioritize Veriﬁcation”) (saves $0.6 million); funding for the aging U.S. nuclear weapons complex. " Nuclear Safeguards and Security Programs Non-weapons programs and support, however, (saves $1.7 million); and should not be funded by nuclear weapons accounts. Congress should cancel the Minority Serving " Defense Environmental Clean-Up (saves $368 Institution Partnership Program, with a savings of million).2 $18.8 million in FY 2020, and return the following programs to their FY 2014 budget levels (in nomi- nal dollars):

ADDITIONAL READING " Michaela Bendikova and Baker Spring, “Bait and Switch on Nuclear Modernization Must Stop,” Heritage Foundation Backgrounder No. 2755, January 4, 2013.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

120 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $193 DISCRETIONARY SAVINGS IN MILLIONS3

Return Funding for the DOE Office of Nuclear Physics to FY 2008 Levels Under the Ofce of Science, the Ofce of Nuclear Funding for the nuclear physics program has Physics supports theoretical and experimental become unafordable in tight ﬁscal conditions. research in the composition of and interactions Program funding should be returned to the inﬂa- within nuclear matter. The DOE and the National tion-indexed FY 2008 amount of $497 million in FY Science Foundation conduct nearly all basic U.S. 2020 (actual FY 2008 spending was $424 million), E&W nuclear physics research, and the DOE provides over a $193 million reduction from its projected FY 2018 90 percent of the nuclear science research funding, level of $690 million. which is employed at universities and federally sponsored research facilities (also called user facilities).4

ADDITIONAL READING

" Nicolas D. Loris, “Department of Energy Budget Cuts: Time to End the Hidden Green Stimulus,” Heritage Foundation Backgrounder No. 2668, March 26, 2012. " James Jay Carafano, Jack Spencer, Bridget Mudd, and Katie Tubb, “Science Policy: Priorities and Reforms for the 45th President,” Heritage Foundation Backgrounder No. 3128, June 13, 2016.

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces funding by $35 million (9%). INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 121 The Heritage Foundation | heritage.org/BlueprintForBalance $517 DISCRETIONARY SAVINGS IN MILLIONS5

Return DOE Advanced Scientific Computing Research to FY 2008 Levels This program under the Ofce of Sciences conducts At the same time, however, this program has also computer modeling, simulations, and testing to been the beneficiary of a consistently expand- advance the DOE’s mission through applied math- ing budget. In order to live within today’s fiscal ematics, computer science, and integrated network constraints, funding should be returned to the infla- environments. These models can lay the foundation-indexed FY 2008 levels of $419 million (actual E&W tion for scientific breakthroughs and arguably are 2008 spending was $351 million). some of the most important aspects of basic Energy Department research.

ADDITIONAL READING " Nicolas D. Loris, “Department of Energy Budget Cuts: Time to End the Hidden Green Stimulus,” Heritage Foundation Backgrounder No. 2669, March 26, 2012. " James Jay Carafano, Jack Spencer, Bridget Mudd, and Katie Tubb, “Science Policy: Priorities and Reforms for the 45th President,” Heritage Foundation Backgrounder No. 3128, June 13, 2016.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at FY 2019 levels.

122 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $366 DISCRETIONARY SAVINGS IN MILLIONS6

Eliminate the DOE Advanced Research Projects Agency–Energy Program ARPA–E is a federal program designed in 2007 The federal government should not be in the to fund high-risk, high-reward projects on which business of picking winners and losers among the private sector would not embark on its own. technologies, even if they are in the early stages of However, ARPA–E does not always seem to follow research and development. Government projects its own clear goals: The federal government has that have become commercial successes—the Inter- E&W awarded several ARPA–E grants to companies and net, computer chips, the global positioning system projects that are neither high-risk nor something (GPS)—were developed initially to meet national that private industry cannot support. The U.S. security needs, not to meet a commercial demand. Government Accountability Ofce found that of the Entrepreneurs saw an opportunity in these defense 44 small and medium-size companies that received technologies and created the commercially viable an ARPA–E award, 18 had previously received products available today. The DOE should conduct private-sector investment for a similar technology. research to meet government objectives that the The GAO also found that 12 of those 18 companies private sector does not undertake. planned to use ARPA–E funding either to advance or to accelerate already funded work.7

ADDITIONAL READING " Nicolas D. Loris, “Department of Energy Budget Cuts: Time to End the Hidden Green Stimulus,” Heritage Foundation Backgrounder No. 2668, March 26, 2012. " James Jay Carafano, Jack Spencer, Bridget Mudd, and Katie Tubb, “Science Policy: Priorities and Reforms for the 45th President,” Heritage Foundation Backgrounder No. 3128, June 13, 2016.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 123 The Heritage Foundation | heritage.org/BlueprintForBalance $705 DISCRETIONARY SAVINGS IN MILLIONS8

Eliminate the DOE Biological and Environmental Research Program

The Ofce of Science BER program funds research (LDRR) program, which was created to understand for a variety of energy-related subjects, including the radiobiological efects of low levels of radiation biology, radiochemistry, climate science, and subsur- exposure. Such research is critical because the face biogeochemistry. Many BER programs should federal government is engaged in regulating low- be cut drastically and moved to the Ofce of Science dose levels that it does not adequately understand, or eliminated entirely because they are activities that and its exercise of such responsibilities as cleanup E&W are better suited to the private sector, duplicate other of the remaining nuclear weapons complex could be research, or do not align with the Energy Depart- improved with more accurate knowledge of radia- ment’s mission. Speciﬁcally, cuts should be made in tion risks. the Climate and Environmental Science program, the Biological Systems Facilities and Infrastructure pro- The Obama Administration gradually decreased gram, the Bioenergy Research Centers program, the funding for the LDRR program and requested no Genomic Science program, and Climate and Environ- funds in its ﬁnal budget. Congress should reconsti- mental Facilities and Infrastructure. tute the LDRR program at FY 2008 levels of funding over the next two years, beginning with 75 percent One BER program that should receive increased funding in FY 2020 and 100 percent funding in funding is the Low-Dose Radiation Research FY 2021.

PROPOSAL STATUS EXPLANATION

PARTIALLY Funding is reduced by $210 million (30%) but not President’s Budget (FY2020) INCLUDED eliminated.

124 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $605 DISCRETIONARY SAVINGS IN MILLIONS9

Reduce Funding for the DOE Basic Energy Sciences Program

The BES program investigates “fundamental Federal scientific R&D funding must meet a spe- research to understand, predict, and ultimately cific government objective or contribute to basic control matter and energy at the electronic, atomic, research where the private sector is not already and molecular levels in order to provide the foun- working. Government projects that have become dations for new energy technologies and to support commercial successes—the Internet, computer DOE missions in energy, environment, and national chips, GPS—were developed initially to meet E&W security.”10 The problem is that many BES sub- national security needs, not to meet a commercial programs stray from fundamental research into demand. Entrepreneurs saw an opportunity in these commercialization. The government should elimi- defense technologies and created the commercially nate such aspects of these programs because private viable products available today. companies are capable of fulfilling these roles, whether through their own laboratories or by fund- The DOE should conduct research to meet govern- ing university research. The proposed cuts would ment objectives that the private sector does not eliminate some subprograms and return others to undertake. In addition, policies should be put in near-FY 2008 levels. place that remove bureaucratic obstacles and invite the private sector, using private funds, to access that research and commercialize it.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 125 The Heritage Foundation | heritage.org/BlueprintForBalance $39 DISCRETIONARY SAVINGS IN MILLIONS11

Eliminate DOE Energy Innovation Hubs

The DOE has four Energy Innovation Hubs (multi- business of picking winners and losers among tech- disciplinary teams) to overcome obstacles in energy nologies, even if they are the early stages of research technologies: the Fuels from Sunlight Hub, Batteries and development. Government projects that have and Energy Storage Hub, Nuclear Energy Modeling become commercial successes—the Internet, com- and Simulation Hub, and Critical Materials Insti- puter chips, GPS—were developed initially to meet tute. Regardless of the merits of such endeavors, national security needs, not to meet a commercial E&W Energy Innovation Hubs focus on promoting spe- demand. Entrepreneurs saw an opportunity in these ciﬁc energy sources and technology developments defense technologies and created the commercially rather than basic research. viable products available today.

Federal scientiﬁc R&D funding should be rational- The DOE should conduct research to meet govern- ized to cut waste and rein in federal spending either ment objectives that the private sector does not to meet a speciﬁc government objective or to con- undertake. In addition, policies should be imple- tribute to basic research in areas where the private mented that remove bureaucratic obstacles and sector is not already working. In 2013, the DOE had invite the private sector, using private funds, to the federal government’s fourth-largest R&D bud- access that research and commercialize it. get.12 The federal government should not be in the

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at FY 2019 levels.

126 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $156 DISCRETIONARY SAVINGS IN MILLIONS13

Eliminate the DOE Office of Electricity

The Ofce of Electricity pursues activities to mod- While upgrading the nation’s electricity grid has ernize the nation’s power grid “to ensure a resilient, merit, it should be accomplished at the private, reliable, and ﬂexible electricity system.”14 Under the local, state, and regional levels. The OE’s role and Obama Administration, much of the funding was those of the Federal Energy Regulatory Commission used to promote electric vehicles and renewable (FERC); the North American Electric Reliability energy. The OE focuses on advanced grid technology Corporation (NERC); regional independent system E&W R&D, transmission permitting and assistance for operators (ISOs); and the private sector are redun- states and tribes, infrastructure security, and cyber- dant. Instead of subsidizing advanced renewable security research and development. It also serves energy resources or smart-grid technology, the as a connection point for communication, informa- federal government should reduce the unneces- tion, and data between the federal government and sary regulatory burden on grid siting and upgrades. the private sector in addressing threats like cyber- National security concerns (for example, in cyber- security and permits cross-border transmission security or for a cooperative public–private role line construction. for grid protection) could very well fall within the

purview of the Department of Homeland Security.

ADDITIONAL READING " Nicolas D. Loris, “Department of Energy Budget Cuts: Time to End the Hidden Green Stimulus,” Heritage Foundation Backgrounder No. 2668, March 26, 2012. " Jonathan Lesser, “America’s Electricity Grid: Outdated or Underrated?” Heritage Foundation Backgrounder No. 2959, October 29, 2014.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 127 The Heritage Foundation | heritage.org/BlueprintForBalance $2.4 DISCRETIONARY SAVINGS IN BILLIONS15

Eliminate the DOE Office of Energy Efciency and Renewable Energy

The EERE funds research and development “to gasoline in 2014. Both the electricity and the trans- create and sustain American leadership in the tran- portation-fuels markets are multitrillion-dollar sition to a global clean energy economy.”16 Under markets. The global market for energy totals $6 the Obama Administration, funding went to such trillion. There is a robust, consistent, and growing projects as “drop-in” biofuels, improvements in demand for energy technology and services inde- engine efciency, vehicle weight reduction, home pendent of any government eforts to subsidize it. E&W energy efciency, and renewables. Promoting these technologies is not an investment in basic research; Congress should eliminate the EERE. The DOE it is outright commercialization. should conduct research to meet government objectives that the private sector does not undertake, All of this spending is for activities that the private and policies should be implemented that remove sector can undertake if companies believe that bureaucratic obstacles and invite the private sector, doing so is in their economic interest. The market using private funds, to access that research and opportunity for clean-energy investments already commercialize it. exists. Americans spent roughly $456 billion on

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending signiﬁcantly by $2 billion (86%). INCLUDED

128 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $985 DISCRETIONARY SAVINGS IN MILLIONS17

Eliminate the DOE Office of Fossil Energy

Under the Obama Administration, most of the diminishes the role of the entrepreneur and crowds funding for fossil-energy research and develop- out private-sector investment. This practice of ment focused on technologies that will reduce CO2 picking winners and losers denies energy technolo- emissions. Such activities should be the province of gies the opportunity to compete in the marketplace, the private sector. The FE also authorizes imports which is the only proven way to develop market-vi- and exports of natural gas, which is an outdated and able products. When the government attempts E&W unnecessary function that unnecessarily restricts to drive technological commercialization, it cir- energy markets. Other funding has been used to cumvents this critical process and almost without manage the government-controlled stockpile of oil, exception fails in some way. the Strategic Petroleum Reserve, which has been used more for politics than for responding to oil Over time, Congress should sell all of the oil in the supply shocks and ignores the private sector’s abil- SPR and sell storage facilities used for the SPR. ity to unload abundant inventories in such an event. Eliminating spending for fossil energy projects and selling of government reserves of stockpiled

By attempting to force government-developed resources eliminates the need for an Ofce of technologies into the market, the government Fossil Energy.

ADDITIONAL READING " Nicolas D. Loris, “Department of Energy Budget Cuts: Time to End the Hidden Green Stimulus,” Heritage Foundation Backgrounder No. 2668, March 26, 2012.

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending by $178 million (24%). INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 129 The Heritage Foundation | heritage.org/BlueprintForBalance $667 DISCRETIONARY SAVINGS IN MILLIONS18

Eliminate the DOE Office of Nuclear Energy

The Ofce of Nuclear Energy aims to advance reprogrammed to reconstitute the statutorily nuclear power in the U.S. and address technical, required Ofce of Civilian Radioactive Waste Man- cost, safety, security, and regulatory issues. As with agement and support the review of Yucca Mountain. conventional fuels and renewables, it is not an Before the Obama Administration eliminated it, the appropriate function of the federal government OCRWM was responsible for managing the permit to spend taxes on nuclear projects that should be application for a deep geologic repository at Yucca E&W conducted by the private sector. Work that clearly Mountain. Regardless of the ultimate fate of Yucca falls under basic R&D should be moved to the Ofce Mountain, completing the review makes available of Science. For example, the President’s Nuclear all of the information needed to make wise decisions Energy Enabling Technologies program is charged about what to do next. with investigating the crosscutting of technologies. Cuts in the NEET budget should include eliminating Congress should provide $50 million each to the the unnecessary Modeling and Simulation Hub and DOE and the Nuclear Regulatory Commission for cutting tens of millions of dollars from the National FY 2020 to start up the program and reevaluate Scientiﬁc User Facility. concrete funding needs in FY 2021. No funds should be used for the DOE’s consent-based siting initiative Fuel-cycle R&D should also be decreased by without direction from Congress. $103.8 million, with the remaining spending

ADDITIONAL READING " Nicolas D. Loris, “Department of Energy Budget Cuts: Time to End the Hidden Green Stimulus,” Heritage Foundation Backgrounder No. 2668, March 26, 2012. " Katie Tubb and Jack Spencer, “Real Consent for Nuclear Waste Management Starts with a Free Market,” Heritage Foundation Backgrounder No. 3107, March 22, 2016.

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending by $500 million (38%). INCLUDED

130 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $270 DISCRETIONARY SAVINGS IN MILLIONS19

Eliminate Funding for DOE Small Business Innovation Research and Small Business Technology Transfer Programs The DOE Ofce of Science includes SBIR and STTR Congress should eliminate all SBIR and STTR fund- programs established by Congress “to support ing in the DOE budget. Government projects that scientiﬁc excellence and technological innovation have become commercial successes—the Internet, through the investment of Federal research funds computer chips, GPS—were developed initially to in critical American priorities to build a strong meet national security needs, not to meet a com- E&W national economy.” The programs are administered mercial demand. Entrepreneurs saw an opportunity by the Small Business Administration, and “[s]mall in these defense technologies and created the com- businesses that win awards…keep the rights to any mercially viable products available today. technology developed and are encouraged to commercialize the technology.”20 The Department of Energy should conduct research to meet government objectives that the private Using taxpayer dollars to ofset higher risk is no sector does not undertake, and policies should be way to promote economic development. It ensures implemented that remove bureaucratic obstacles that the public pays for the failures, as has been and invite the private sector, using private funds, to the case with failed government energy invest- access that research and commercialize it. ments, while the private sector reaps the beneﬁts of any successes.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 131 The Heritage Foundation | heritage.org/BlueprintForBalance $25.7 MIXED SAVINGS IN BILLIONS21

Liquidate the Strategic Petroleum Reserve and the Northeastern Home Heating and Gasoline Supply Reserves The SPR has been used more for politics than for private companies. This would save $25.6 billion in responding to oil supply shocks, and it ignores FY 2020. the private sector’s ability to unload abundant inventories in such an event. Private inventories The DOE should also liquidate or privatize the and reserves are abundant, and open markets will Northeast Home Heating Oil Reserve and the E&W respond more efciently to supply shocks than Gasoline Supply Reserve. These reserves were federally controlled government stockpiles can. established by the Energy Policy and Conserva- Congress should authorize the DOE to liquidate tion Act and are held by the DOE. They contain 1 these reserves and sell or decommission the sup- million gallons of diesel and 1 million gallons of porting infrastructure. reﬁned gasoline to protect against supply disrup- tions for homes and businesses in the Northeast To avoid disrupting oil markets, the DOE should that are heated by oil, to be used at the President’s sell the SPR oil by periodically auctioning an discretion. Private companies respond to prices and amount not exceeding 10 percent of the previ- market scenarios by building up inventories and ous month’s total U.S. crude production until the unloading them much more efciently than gov- reserve is completely depleted. The DOE should ernment-controlled stockpiles can. This saves $156 then decommission the storage space or sell it to million in FY 2020.

ADDITIONAL READING " Nicolas D. Loris, “Department of Energy Budget Cuts: Time to End the Hidden Green Stimulus,” Heritage Foundation Backgrounder No. 2668, March 26, 2012. " Nicolas D. Loris, “Why Congress Should Pull the Plug on the Strategic Petroleum Reserve,” Heritage Foundation Backgrounder No. 3046, August 20, 2015.

PROPOSAL STATUS EXPLANATION

PARTIALLY Fully includes the heating oil reserves while reducing the President’s Budget (FY2020) INCLUDED SPR.

132 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $30.0 MIXED SAVINGS IN BILLIONS22

Auction Off the Tennessee Valley Authority

The TVA’s original purpose was to provide naviga- and growing liabilities for all U.S. taxpayers. Amer- tion infrastructure, ﬂood control, power generation, icans serviced by the TVA pay some of the region’s reforestation, and economic development in a highest electricity prices. Despite three major region encompassing nine states, especially Ten- debt-reduction eforts in recent history, the TVA has nessee, Alabama, Mississippi, and Kentucky. This still not reduced its taxpayer-backed and ratepay- goal has long been accomplished. The TVA’s contin- er-backed debt. E&W uance as a government corporation is an outmoded means of providing rural areas with electricity that The most efective way to restore efciency to the enables tremendous special privileges that inter- TVA is to sell its assets in a competitive auction that fere with market competition. The lack of efective honors existing contracts and continues service for oversight from either the government or the private existing customers. Any proceeds should be used sector has led to costly decisions, environmental solely to pay down the national debt. damage, excessive expenses, high electricity rates,

ADDITIONAL READING " Ken G. Glozer, “Time for the Sun to Set on the Tennessee Valley Authority,” Heritage Foundation Backgrounder No. 2904, May 6, 2014.

PROPOSAL STATUS EXPLANATION

PARTIALLY Takes steps toward privatization by selling transmission President’s Budget (FY2020) INCLUDED assets.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 133 The Heritage Foundation | heritage.org/BlueprintForBalance $34.6 MIXED SAVINGS IN BILLIONS23

Auction Off the Four Remaining Power Marketing Administrations

Electricity production and distribution is pri- areas as Los Angeles, California; Vail, Colorado; marily a private and local function. The federal and Las Vegas, Nevada. government should not be in the business of managing and selling power. The PMAs were Generating and distributing commercial electricity organized in the 1930s as part of the New Deal to should not be a centralized, government-managed maintain power generation, dams, reservoirs, and activity, and taxpayers should not be forced to E&W locks. They sell electricity in the South and West at subsidize the electricity bills of a select group of subsidized prices. They do not pay taxes, and they Americans. Both the Reagan and Clinton Adminis- enjoy low-interest loans subsidized by taxpayers. trations proposed privatizing the PMAs. The Alaska Originally intended to pay of federal irrigation and Power Administration was sold to its customers, and dam construction and to provide subsidized power the remaining PMAs should similarly be sold under to poor communities, the PMAs now supply such competitive bidding.

ADDITIONAL READING " Nicolas D. Loris, “Department of Energy Budget Cuts: Time to End the Hidden Green Stimulus,” Heritage Foundation Backgrounder No. 2668, March 26, 2012. " Ken G. Glozer, “Time for the Sun to Set on the Tennessee Valley Authority,” Heritage Foundation Backgrounder No. 2904. May 6, 2014.

PROPOSAL STATUS EXPLANATION

Takes steps toward privatization by selling transmission PARTIALLY President’s Budget (FY2020) assets, repeals borrowing authority, and requires selling INCLUDED power at market rates.

134 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 E&W

135 Currently, companies must obtain approval approval obtain companies must Currently, The electricity sector would benefit from The electricity sector would benefit Congress should open access to America’s national Congress should open access to America’s Any sustainable, long-term solution for nuclear waste long-term solution for nuclear waste sustainable, Any A FEDERAL BUDGET FOR FISCAL YEAR 2020 24 Passed in 1906, the Foreign Dredge Act engaged that all ships requires the Foreign in 1906, Passed The Jones Act is blatant cronyism by which the government confers special government which the by Act The Jones is blatant cronyism heritage.org/BlueprintForBalance Blueprint for Balance: Commission to complete their review of the permit application and transition to a more market- Commission to complete based approach. management requires geologic storage. Taxpayers and electricity ratepayers have spent more than $15 spent more have ratepayers and electricity management requires geologic storage. Taxpayers it as a viable disqualified evidence has yet site, and no technical or scientific Mountain billion on the Yucca Congress should appropriate funds to the Department of Energy and the Nuclear Regulatory option. the federal government needs. the federal government Mountain. licensing for Yucca Complete explore commercial opportunities. Federal labs should allow basic research to reach the market organically. organically. to reach the market basic research labs should allow Federal explore commercial opportunities. national laboratories management to help America’s a more efective structure Congress should establish money and the labs’ ability to conduct the basic research that taxpayer while protecting work with industry Open access to America’s national laboratories. national laboratories. Open access to America’s research and to tap into DOE using private funds, the private sector, that allows labs and create a system one. The U.S. trades regularly with a number of non-FTA countries, and natural gas should be treated as any as any and natural gas should be treated countries, trades regularly with a number of non-FTA one. The U.S. process and from the permitting the DOE globally traded good Congress should remove other is treated. to permit LNG facilities. states empower gas. A facility is automatically authorized if the recipient country has a free trade agreement with the U.S. In agreement with the U.S. is automatically authorized if the recipient country has a free trade A facility gas. of natural gas exports the volume permit if it believes a the DOE can arbitrarily deny the absence of an FTA, a political decision, not The decision to export natural gas should be a business in the public interest. is not Remove impediments to exports of liquefied natural gas. of liquefied natural gas. impediments to exports Remove exporting natural Regulatory Commission and the Department of Energy before Energy from the Federal Repeal the Jones Act. Repeal the Jones would law else. Repealing this outdated, protectionist of everyone treatment on one group at the expense and benefit American consumers. the economy, strengthen competition, promote energy needs and preferences while protecting customers from unwise investments. Competitive markets markets Competitive investments. from unwise customers protecting energy needs and preferences while technologies. units and the entry of innovative expensive also resulted in the efcient exit of older, have competition and the repeal of current policy, which forces utilities to purchase qualifying renewable energy which forces utilities to purchase qualifying renewable and the repeal of current policy, competition and Technology to small scale or geographic energy capacity and arbitrarily limits renewable proximity. unique customer encourages in the electricity sector companies to meet energy source–neutral competition that meet their needs without regard to country of origin. their needs without regard to that meet Act. Policies Repeal the Public Utilities Regulatory control costs. Over the 2014 to 2016 period, the average U.S. dredging project received just two bids, and two bids, just project received dredging period, the average U.S. to 2016 the 2014 Over control costs. increase act would share. Repealing this protectionist for 56 percent of market three companies accounted to select companies sponsors while allowing for American dredging projects and reduce costs competition tonnage) and produce just 0.2 percent of U.S. gross domestic product. Only two hopper dredges have been Only two hopper dredges product. have gross domestic percent of U.S. 0.2 tonnage) and produce just has created The restriction despite large improvements. demand for maritime 10 years, built in the past capacity or to increase incentive an oligopoly with little connected dredging companies of politically in dredging U.S. waters must be built in the United States. The act has ensured that U.S. ports do not have have do not ports that U.S. The act has ensured United States. be built in the must waters U.S. in dredging domestic dredging firms but has failed to stimulate international fective cost-e and most access to the largest (by shipbuilding market hold less than 1 percent of the global shipbuilders deadweight U.S. industry. POLICY RIDERS POLICY Dredge Act. Foreign Repeal the The Heritage Foundation | E&W 136 The Heritage Foundation | Foundation Heritage The government favoritism forspecialinterests. based energysectorwouldbenefitconsumersby delivering reliable,afordableenergywhileeliminating transportation fornongovernment consumers, includingtheextension ofexisting programs. Amarket- no taxpayer dollarswillbeuseddirectlyforenergyproduction,storage,efciency, infrastructure, or Prohibit new loanguaranteesandany new energysubsidies. Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A Congress shouldmake clearthat E&W

137 , , March 2018, 2018, , March , p. 42. Heritage 42. , p. , March 2019, p. 42, 42, p. 2019, , March Heritage 42. , p. , March 2018, p. 334, 334, p. 2018, , March , p. 42. The estimated savings of $605 savings estimated The 42. , p. Audit Report: The Advanced Research Projects Agency– Projects Research Advanced The Report: Audit , February 2016, p. 239, 239, p. 2016, , February Department of Energy FY 2017 Congressional Congressional FY 2017 Energy of Department Department of Energy FY 2019 Congressional Budget Request, Volume 1, National 1, National Volume Request, Budget Congressional FY 2019 Energy of Department A FEDERAL BUDGET FOR FISCAL YEAR 2020 Department of Energy FY 2019 Congressional Budget Request, Volume 4, Science Volume Request, Budget Congressional FY 2019 Energy of Department Department of Energy FY 2020 Congressional Budget Request: Budget in Brief Budget Request: Budget Congressional FY 2020 Energy of Department Department of Energy FY 2020 Congressional Budget Request: Budget in Brief Budget Request: Budget Congressional FY 2020 Energy of Department Department of Energy FY 2020 Congressional Budget Request: Budget in Brief Budget Request: Budget Congressional FY 2020 Energy of Department Department of Energy: Advanced Research Projects Agency–Energy Could Benefit from Information Information Benefit from Could Agency–Energy Projects Research Advanced Energy: of Department , GAO-12-112, January 2012, http://www.gao.gov/assets/590/587667.pdf (accessed March 24, 2019). See also U.S. See also U.S. 2019). 24, March (accessed http://www.gao.gov/assets/590/587667.pdf January 2012, , GAO-12-112, Science: Advanced Research Projects Agency—Energy Projects Research Advanced Science: No. 3128, June 13, 2016, http://thf-reports.s3.amazonaws.com/2016/BG3128.pdf. 3128, June 13, 2016, No. , heritage.org/BlueprintForBalance Blueprint for Balance: ciency and Renewable and Renewable fciency E 2, 3, Energy Part Volume Request, Budget Congressional FY 2019 Energy of Department Department of Energy FY 2020 Congressional Budget Request: Budget in Brief Budget Request: Budget Congressional FY 2020 Energy of Department Volume 4 Volume , No. 2668, March 26, 2012, http://thf_media.s3.amazonaws.com/2012/pdf/bg2668.pdf. These cuts would have brought brought have would cuts These http://thf_media.s3.amazonaws.com/2012/pdf/bg2668.pdf. 2012, 26, March 2668, No. Backgrounder Backgrounder , OAS-RA-11-11, August 2011, https://www.energy.gov/sites/prod/files/OAS-RA-11-11.pdf (accessed March 24, 2019). 24, March (accessed https://www.energy.gov/sites/prod/files/OAS-RA-11-11.pdf 2011, August , OAS-RA-11-11, https://www.energy.gov/sites/prod/files/2018/03/f49/FY-2019-Volume-3-Part-2.pdf (accessed March 24, 2019), and U.S. Department of Department and U.S. 2019), 24, March (accessed https://www.energy.gov/sites/prod/files/2018/03/f49/FY-2019-Volume-3-Part-2.pdf https://www.energy.gov/sites/prod/files/2016/02/f29/FY2017BudgetVolume%204.pdf (accessed March 24, 2019). 24, March (accessed https://www.energy.gov/sites/prod/files/2016/02/f29/FY2017BudgetVolume%204.pdf https://www.energy.gov/sites/prod/files/2019/03/f60/doe-fy2020-budget-in-brief_0.pdf (accessed March 24, 2019). The FY 2008 level of of FY 2008 level The 2019). 24, March (accessed https://www.energy.gov/sites/prod/files/2019/03/f60/doe-fy2020-budget-in-brief_0.pdf Foundation Foundation spending FY 2019 that assume Heritage experts 2019. Act, Appropriations airs f A and Veterans and Military Construction Branch, Legislative cer, of Chief Financial O fcer, Ofce Energy, it is Hub (because and Simulation Modeling the Nuclear Energy nothing for Hub; Storage and Energy the Batteries million for $24.3 Hub; FY 2019). FY 2013 spending to a level of $1.402 billion, which would be $1.561 billion in inflation-adjusted FY 2020 dollars based on the personal based on the personal dollars FY 2020 billion in inflation-adjusted be $1.561 billion, which would of $1.402 a level spending to FY 2013 Financial Ofcer, ce of Audits and Inspections, and Inspections, of Audits Ofce General, of Inspector fce O of Energy, Department fcer, of Chief Financial O Ofce Energy, airs Appropriations Act, 2019, Public Law 115-244, 115th Cong., September 21, September 115th Cong., 115-244, Public Law 2019, Act, Appropriations airs f A and Veterans and Military Construction Branch, Legislative cer, fcer, of Chief Financial O Ofce Energy, Nuclear Safeguards, and $368 million for reductions in Defense Environmental Clean-Up. Environmental in Defense reductions for and $368 million Nuclear Safeguards, of Chief Financial Ofcer, Ofce Energy, cer, Financial Ofcer, of Chief Ofce of Energy, Department include $18.8 Savings 2019). 24, March (accessed https://www.energy.gov/sites/prod/files/2018/03/f49/FY-2019-Volume-1.pdf 2018, March $424 million would be $497 million in inflation-adjusted 2019 dollars based on the personal consumption expenditures (PCE) index through through (PCE) index expenditures consumption on the personal based dollars 2019 million in inflation-adjusted be $497 million would $424 $30.3 million for reductions in Information Technology and Cyber Security, $0.6 million for Nuclear Verification, $1.7 million for International International million for $1.7 Nuclear Verification, million for $0.6 Security, and Cyber Technology in Information reductions million for $30.3 remains constant in FY 2020. constant remains p. 49, https://www.energy.gov/sites/prod/files/2018/03/f49/DOE-FY2019-Budget-Volume-4_0.pdf (accessed March 24, 2019). Heritage 2019). 24, March (accessed https://www.energy.gov/sites/prod/files/2018/03/f49/DOE-FY2019-Budget-Volume-4_0.pdf 49, p. does not fund this in request the budget (because Institute the Critical Materials and nothing for request); budget in the FY 2019 not listed erence between the inflation-adjusted FY 2020 recommended level of $1.561 billion and the estimated FY estimated billion and the of $1.561 level recommended FY 2020 the inflation-adjusted between erence equals the dif FY 2019 million for million for cancelling the Minority Serving Institution Partnership Program, $73 million for reductions in the Secure Transportation Asset, Asset, Transportation in the Secure reductions for million $73 Program, Partnership Serving Institution the Minority cancelling million for Sciences as found in Nicolas D. Loris, “Department of Energy Budget Cuts: Time to End the Hidden Green Stimulus,” Heritage Foundation Heritage Foundation Stimulus,” End the Hidden Green to Cuts: Time Budget of Energy “Department Loris, D. in Nicolas as found Sciences erence between projected projected between erence equal the dif Savings (PCE) index. expenditures consumption based on the personal dollars 2020 adjusted cer, Chief Financial Ofcer, Energy, Nuclear Energy, Advanced Research Projects Agency–Energy, Advanced Tech. Vehicles Manufacturing Loan Program, Title 17– Title Program, Loan Manufacturing Vehicles Tech. Advanced Agency–Energy, Projects Research Advanced Nuclear Energy, Energy, Backgrounder Energy Budget Request Budget Nuclear Security Administration: Federal Salaries and Expenses, Weapons Activities, Defense Nuclear Nonproliferation, Naval Reactors Naval Nonproliferation, Nuclear Defense Activities, Weapons Expenses, Salaries and Federal Administration: Nuclear Security spending of $936 million and recommended spending of $419 million. spending of $419 million and recommended spending of $936 2020. in FY constant spending remains experts assume that FY 2017 spending remains constant through FY 2019. Estimated savings include $15 million for the Fuels from Sunlight Sunlight from the Fuels million for include $15 savings Estimated FY 2019. through constant spending remains FY 2017 that assume experts ce of Chief Ofce of Energy, Department in U.S. billion as found $2.166 was spending level FY 2019 The index. (PCE) expenditures consumption experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume experts experts assume that FY 2019 spending remains constant in FY 2020. The FY 2008 level of $351 million would be $419 million in inflation- be $419 million would of $351 FY 2008 level The in FY 2020. constant spending remains FY 2019 that assume experts Innovative Tech. Loan Guarantee Program, Tribal Energy Loan Guarantee Program, Energy Information Administration Information Energy Program, Guarantee Loan Energy Tribal Program, Guarantee Loan Tech. Innovative 2019 level of $2.166 billion. Heritage experts assume that the FY 2019 enacted level holds steady in FY 2020. steady holds level enacted the FY 2019 that assume billion. Heritage experts of $2.166 level 2019 2018, https://www.congress.gov/115/bills/hr5895/BILLS-115hr5895enr.pdf (accessed March 24, 2019). Heritage experts assume that FY 2019 FY 2019 that assume Heritage experts 2019). 24, March (accessed https://www.congress.gov/115/bills/hr5895/BILLS-115hr5895enr.pdf 2018, 2019 and assuming 2.0 percent inflation in 2020). inflation percent 2.0 and assuming 2019 (accessed March 24, 2019). 24, March (accessed on Applicants’ Prior Funding on Applicants’ Totals may not add due to rounding. not add due to may Totals Estimated savings of $605 million for FY 2020 are based on the recommended $287.6 million in FY 2013 spending cuts for Basic Energy Basic Energy for spending cuts million in FY 2013 $287.6 based on the recommended are FY 2020 of $605 million for savings Estimated Estimated savings of $493 million for FY 2020 are based on the requested FY 2018 spending levels for each program as specified in U.S. in U.S. as specified each program for levels spending FY 2018 requested based on the are FY 2020 for million of $493 savings Estimated ce of Science, “Basic Energy Sciences (BES),” last modified June 29, 2018, http://science.energy.gov/bes/ http://science.energy.gov/bes/ 2018, modified June 29, last (BES),” Sciences “Basic Energy of Science, Ofce of Energy, Department U.S. Estimated savings of $156 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. 5895, Energy and Water, and Water, Energy as specified in H.R. 5895, level appropriated based on the FY 2019 are FY 2020 million for of $156 savings Estimated James Jay Carafano, Jack Spencer, Bridget Mudd, and Katie Tubb, “Science Policy: Priorities and Reforms for the 45th President,” Heritage President,” the 45th for Priorities and Reforms Policy: “Science Tubb, Katie Mudd, and Bridget Jack Spencer, Carafano, James Jay ce of Ofce of Energy, Department in U.S. as found spending levels based on the FY 2017 are FY 2020 million for of $39 savings Estimated ce, Ofce, Accountability Government U.S. cer, of Chief Financial Ofcer, Ofce of Energy, Department U.S. Estimated savings of $366 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. 5895, Energy and Water, and Water, Energy as specified in H.R. 5895, level appropriated based on the FY 2019 are FY 2020 of $366 million for savings Estimated Estimated savings of $705 million for FY 2020 are based on the FY 2019 spending level of $705 million as found in U.S. Department of of Department in U.S. million as found of $705 level spending based on the FY 2019 are FY 2020 million for of $705 savings Estimated Estimated savings of $517 million for FY 2020 are based on the FY 2019 spending level of $936 million as found in U.S. Department of Department in U.S. million as found of $936 spending level based on the FY 2019 are FY 2020 million for of $517 savings Estimated Estimated savings of $193 million for FY 2020 are based on the FY 2019 spending level of $690 million as found in U.S. Department of Department in U.S. million as found $690 of level spending based on the FY 2019 are FY 2020 million for of $193 savings Estimated

8. 5. The Heritage Foundation | 6. 9. ENDNOTES 12. 13. 11. 10. 1. 2. 3. 7. 4. E&W 138 The Heritage Foundation | Foundation Heritage The 24. 23. 22. 21. 20. 19. 18. 17. 16. 15. 14.

“About,” last modifiedDecember 21,2018, http://science.energy.gov/sbir/about/ (accessed March 24, 2019). January 2019 CBO baselinespendingprojections. SeeCongressional Budget Ofce, “The Budget andEconomic Outlook:2019 to 2029: Texas sour. Heritageexperts assume that inventory remains at that level until thesell-ofbeginsandthat prices remain constant through Estimated savings of$270 millionfor FY2020 are basedondata in U.S. Department ofEnergy, Ofce ofEnergy Efciency andRenewable Energy, “About theOfce ofEnergy E fciency andRenewable Estimated savings of$667 millionfor FY2020 are basedontherecommended $178 millioninFY2013 spendingcuts for nuclearenergy Estimated savings of$985 millionfor FY2020 are basedontheFY2019 appropriated level asspecifiedinH.R.5895, Energy andWater, Estimated savings of$2.379 billionfor FY2020 are basedontheFY2019 appropriated level asspecifiedinH.R.5895, Energy andWater, U.S. Department ofEnergy, Ofce ofElectricity Delivery andEnergy Reliability, “About theOfce ofElectricity,” Estimated savings of$34.597 billionfor FY2020 are basedonthelower-end, inflation-adjusted estimate inaprevious CBO study that Estimated savings of $30.026 billionfor FY2020 are basedonthelower endofanestimated value of$30billion(one-time savings Estimated one-timesavings of$25.487 billionfor FY2020 are basedonselling10percent oftheprevious month’s inventory eachmonth. U.S. Department ofEnergy, Ofce ofScience, SmallBusiness Innovation Research (SBIR) andSmallBusiness Technology Transfer (STTR), Nicolas D. Loris, “Removing Restrictions onLiquid Natural Exports:AGiftto Gas theU.S. andGlobalEconomies,” Heritage Foundation (accessed March 24, 2019). Ininflation-adjusted terms, theCBO’s FY1997 estimates translate into arange of$33.767 billion to $45.512 billion 2019, https://www.cbo.gov/about/products/budget-economic-data#9 (accessed March 26, 2019). Thus, theone-timesavings from selling valued thembetween $23billionand$31inFY1997. SeeCongressional Budget O fce, “ShouldtheFederal Government Sell discretionary savings. diference between theinflation-adjusted FY2019 recommended level of$659 millionandtheestimated FY2020 level of$1.326 billion. operation andmaintenance costs, whichare projected to total $190 millionindiscretionary savings for FY2020, andanother$640million in estimate at $33.767 billioninone-timesavings for FY2020. Inaddition,auctioning ofthesePMAswould generate savings from theannual of theSPRequals$25.331 billioninFY2020 aswell as$235 millionindiscretionary savings. One-timesavings inFY2020 from sellingthe on theSPR’s inventory (March 15, 2019), including254.6 MMBofWest Texas Intermediary sweet crudeoiland394.5 MMBofsourcrudeoil, expenditures (PCE)index. The FY2019 spendinglevel was $1.326 billionasspecifiedinH.R.5895, Energy andWater, Legislative Branch, spending to alevel of$592 million,whichwould be$659 millionininflation-adjusted FY2020 dollars basedonthepersonal consumption Backgrounder Ofce, “The Budget andEconomic Outlook:2019 to 2029: Budget andEconomic Data: SpendingProjections, by Budget Account,” January assets intheSoutheast suggest that theTVA’s value isbetween $30billionand$40billion.For anassessment oftheTVA’s value, see SPR andNortheast Reserves saves atotal of$25.732 billioninFY2020, including$25.487 billioninone-timesavings and$245 millionin and thecurrent price pergallonis$1.95 for homeheating oiland$1.76 for gasoline. Heritageexperts assume that theseprices holdconstant and MilitaryConstruction andVeterans Afairs Appropriations Act, 2019. The estimated savings of$667 millionfor FY2020 equalsthe as found inLoris, “Department ofEnergy Budget Cuts:Time to EndtheHiddenGreen Stimulus.” These cuts would have brought FY2013 projections. See Congressional Budget Ofce, “The Budget andEconomic Outlook:2019 to 2029: Budget andEconomic Data: Spending mandatory savings from thefundscontributed to thesePMAsasestimated by theCBO initsmost recent January2019 baselinespending million from thisamount becausetheCBO projects that theSPRwillsellof$610 millionworth ofoilinFY2020. SeeCongressional Budget remains constant inFY2020. for atotal of649.1 MMB. Asof April27, 2018, themarket price for oilwas $59.44 for West Texas Intermediate sweet and$53.04 for West until thereserves are sold.SellingtheNortheast Reserves alsoincludes$10 millionindiscretionary savings. Seeibid.Sellingofboththe the FY2018 enacted level) holdssteady inFY2020. In FY2020, thiswould meansellingof477 millionbarrels (183MMBsweet and284MMBsour)basedonthemost recently available data Projections, by Budget Account.” Thus, total savings equal$34.597 billion inFY2020. Electricity?” Ken G.Glozer, “Time for theSunto Set ontheTennessee Valley Authority,” HeritageFoundation Budget andEconomic Data: SpendingProjections, by Budget Account.” Itishard to know theTVA’s market value, butcomparable Northeastern SupplyReserves HomeHeating andGasoline equals$156 million.Bothreserves hold1millionbarrels (42 gallonsperbarrel), FY 2019. This results intotal salesof25.941 billionMMB(roughly 72 percent ofthecurrent inventory). Heritageexperts subtract $610 Heritage experts assume that theFY2019 enacted level holdssteady inFY2020. Reserves. Heritageexperts assume that FY2019 spendingremains constant inFY2020. Research andDevelopment, $10 millionfrom theNaval Petroleum andOilShaleReserves, and$235 millionfrom theStrategic Petroleum Legislative Branch, andMilitaryConstruction andVeterans Afairs Appropriations Act, 2019. Savings include$740 millionfrom Fossil Energy Energy,” http://energy.gov/eere/about-ofce-energy-efciency-and-renewable-energy (accessed March 24, 2019). Legislative Branch, andMilitaryConstruction andVeterans Afairs Appropriations Act, 2019. Heritageexperts assume that FY2019 spending in estimated FY2020 dollars, basedonthepersonal consumption expenditures (PCE)index. Heritageexperts assume thelow endofthis in FY2020) for theTVA aswell as $26 millioninmandatory contributions to theTVA fundinFY2020 asincludedinthemost recent http://www.heritage.org/research/reports/2014/05/time-for-the-sun-to-set-on-the-tennessee-valley-authority. https://www.whitehouse.gov/wp-content/uploads/2019/03/appendix-fy2020.pdf (accessed March 24, 2019). Heritageexperts assume that https://www.energy.gov/oe/about-ofce-electricity (accessed March 24, 2019). CBO Study No. 3232, July27, 2017, https://www.heritage.org/sites/default/files/2017-07/BG3232.pdf. , November 1997, p. 15, https://www.cbo.gov/sites/default/files/105th-congress-1997-1998/reports/electric.pdf Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A Fiscal Year 2020 Budget of theU.S. Government: Appendix Backgrounder No. 2904, May 6,2014, , p. 378, Financial Services and General Government The Heritage Foundation | heritage.org/BlueprintForBalance $1.7 DISCRETIONARY SAVINGS IN BILLIONS1

Eliminate the Small Business Administration’s Disaster Loans Program

After federally declared disasters, the DLP ofers requirement is that borrowers are forced to rebuild taxpayer-funded direct loans to assist businesses, in disaster-prone locations. For example, instead of nonprofit organizations, homeowners, and rent- moving away from a town located in a major flood ers in repairing damaged property and replacing zone, applicants are required to rebuild in exactly destroyed property. Unfortunately, the generous the same high-risk area. In many cases, the loans fail federal disaster relief ofered by the DLP creates to ofer a long-term solution. a “moral hazard” by discouraging individuals and businesses from purchasing insurance for natu- The DLP program amounts to a poorly managed ral catastrophes. The SBA awards disaster loans government subsidy for private businesses. Giving regardless of whether the beneficiaries previously it the authority to provide grants to whomever it

FS took steps to reduce their exposure to losses from deems ﬁt is an improper use of emergency funding natural disasters. and fails to prioritize aid to those who need it most. The program has a history of poor management While SBA disaster loans are intended to help and falls outside the proper scope of the fed- applicants return their property to its pre-disaster eral government. condition, the unintended consequence of this

ADDITIONAL READING " Justin Bogie, “Congress Must Stop the Abuse of Disaster and Emergency Spending,” Heritage Foundation Backgrounder No. 3380, February 4, 2019. " David B. Muhlhausen, “Business Disaster Reform Act of 2013: Review of Impact and Efectiveness,” testimony before the Committee on Small Business and Entrepreneurship, U.S. Senate, March 14, 2013. " Justin Bogie, “Trump’s Budget Deal with Democrats Will Only Worsen Our Fiscal Situation,” The Daily Signal, September 7, 2017.

" David Inserra, Justin Bogie, Diane Katz, Salim Furth, Monica Burke, Katie Tubb, Nicolas D. Loris, and Steven P. Bucci, “After the Storms: Lessons from Hurricane Response and Recovery in 2017,” Heritage Foundation Special Report No. 201, April 16, 2018.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at FY 2019 levels.

140 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $22 DISCRETIONARY SAVINGS IN MILLIONS2

Reform the Securities and Exchange Commission

The SEC’s mission is to protect investors; maintain should be merged into other ofces. The commis- fair, orderly, and efcient markets; and facilitate sion’s information technology programs appear to capital formation. Over the past 10 years, the SEC’s be poorly managed and are unnecessarily costly. Its budget has increased by 82 percent—two times contracting oversight is insufcient. The SEC bases faster than the budget of the government as a its decisions on inadequate data and does much less whole and the size of its workforce has increased than most agencies to provide data to commission- by 33 percent without improving the SEC’s efec- ers, other policymakers, and the public. tiveness. Resources have flowed into unnecessary management, “support,” and ancillary functions The SEC’s enforcement eforts directed at fraud and while core functions have been neglected. The SEC other malfeasance by managers of large financial has become sclerotic and moribund, with too many institutions are inadequate. A Complex Case Unit FS layers of middle management, too many ofces, and should be created within the Enforcement Divi- too many layers of review. It needs to be reformed, sion to handle cases involving large, complex, and streamlined, and better managed, and its budget well-financed investment banks, banks, investment should be frozen at its FY 2018 level ($1.65 billion). companies, and similar market participants. The budget and stafng levels of the SEC Ofce of the Reforms are necessary so that the SEC can better Inspector General deserve serious scrutiny. Serious support well-functioning capital markets. The com- questions have been raised about the neutrality mission does not need (as has been proposed) more and impartiality of SEC administrative law judges. managers. It has over 50 percent more managers Respondents should be allowed to elect whether the per employee than other large independent agen- adjudication occurs in the SEC’s administrative law cies. The number of direct reports to the chairman court or an ordinary article III federal court. should be reduced from 23 to 12, and 11 ofces

ADDITIONAL READING " David R. Burton, “Reforming the Securities and Exchange Commission,” Heritage Foundation Backgrounder No. 3378, January 30, 2019. " “Securities and Exchange Commission,” in “Blueprint for Reorganization: An Analysis of Federal Departments and Agencies,” ed. David B. Muhlhausen, Heritage Foundation Special Report No. 192, June 12, 2017, pp. 203–205.

PROPOSAL STATUS EXPLANATION

Proposes to eliminate SEC's reserve fund in order to NOT President’s Budget (FY2020) restore accountability but does not propose any other ADDRESSED reforms.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 141 The Heritage Foundation | heritage.org/BlueprintForBalance $250 DISCRETIONARY SAVINGS IN MILLIONS3

Eliminate the Department of the Treasury’s Community Development Financial Institutions Fund The Community Development Financial Institu- The CDFI should be shut down because it amounts tions fund (CDFI) provides grants to community to corporate welfare in the form of grants, bond development financial institutions, community guarantees, and tax credits. This favoritism hin- development entities, and other private financial ders competition and distorts private markets, institutions. Since 2010, a total of more than $15 bil- ultimately leading to higher consumer prices and lion in taxpayer dollars has been disbursed through further justification for increased federal spending.4 these programs. FS

PROPOSAL STATUS EXPLANATION

PARTIALLY Eliminates and winds down the CDFI grant program but President’s Budget (FY2020) INCLUDED extends the CDFI bond guarantee program.

142 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $80 DISCRETIONARY SAVINGS IN MILLIONS5

Eliminate the Export–Import Bank

The Export–Import Bank provides subsidized transportation measure. Because of vacancies on financing to foreign firms and governments for the the bank’s board of directors, however, the reau- purchase of American exports. When fully opera- thorization did not return Ex–Im to business as tional, the program primarily benefits very large usual. With few exceptions, all Ex–Im financing corporations and puts unsubsidized American firms that exceeds $10 million must be approved by a at a competitive disadvantage. Moreover, taxpayers three-member quorum of the bank’s five-member are on the hook for any losses that the bank fails board. Currently, there are three vacancies. to cover with reserves. These risks are ignored in reported budget figures, which assume that program Not only do Ex–Im’s direct costs account for default fees will fully ofset Ex–Im costs. This assumption risk, but they do not reflect the detrimental impacts fails to account for default risks. According to the on U.S. firms that result from the subsidizing of FS Congressional Budget Ofce, the more accurate overseas competitors. The subsidies also distort fair-value accounting method that prevails in the the allocation of capital and labor. For example, private sector reveals program costs of $2 billion for export financing of coal mining in Colombia, copper the bank’s six largest programs for fiscal years 2015 excavation in Mexico, and airplanes for India has to 2024.6 led to job losses for domestic companies. There is no shortage of private financing, and Ex–Im subsidies In 2015, Congress reauthorized Ex–Im through are not needed to maintain exports. 2019 as a rider to a bloated multibillion-dollar

ADDITIONAL READING " Diane Katz, “Export–Import Bank: Cronyism Threatens American Jobs,” Heritage Foundation Issue Brief No. 4231, June 2, 2014. " Diane Katz, “The Export–Import Bank: A Government Outﬁt Mired in Mismanagement,” Heritage Foundation Issue Brief No. 4208, April 29, 2014.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at FY 2019 levels.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 143 The Heritage Foundation | heritage.org/BlueprintForBalance $10 DISCRETIONARY SAVINGS IN MILLIONS7

Eliminate Funding for the Office of Personnel Management’s Multi-State Plan Program Congress created the MSP program under the the program.9 In 2015, the OPM added the so-called Afordable Care Act (ACA), enacted in 2010. The co-op plans to its roster of insurers, even though statute required the Ofce of Personnel Man- these plans were ﬁnancially unstable and most have agement to contract with at least two insurance since collapsed. By 2017, the plans were supposed companies to compete with all other private health to be available in every state. In 2018, only one state plans in the health insurance exchanges in every (Arkansas) ofered an MSP exchange option.10 state.8 In 2018, the House of Representatives passed H.R. The program has been a monumental failure. In 6147,11 a major appropriations bill, which included

FS 2014, the OPM contracted with only one large an amendment by Representative Mark Meadows insurer rather than two and projected an enroll- (R–NC) to eliminate funding for the program. The ment of 750,000 for that year. As of April 2014, Senate, however, took no action on the measure. however, only 280,000 in 30 states were enrolled in

ADDITIONAL READING " Robert Emmet Moft and Neil R. Meredith, “Multistate Health Plans: Agents for Competition or Consolidation?” Mercatus Center at George Mason University, Working Paper, January 2015. " The Honorable Linda Springer, The Honorable Donald J. Devine, The Honorable Dan G. Blair, and Robert E. Moft. “The Ofce of Personnel Management: A Power Player in America’s Health Insurance Markets?” Heritage Foundation Lecture No. 1145, February 19, 2010 (delivered January 20, 2010).

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

144 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $1.9 DISCRETIONARY SAVINGS IN BILLIONS12

Replace Costly Provisions of Dodd–Frank

Despite the claims of its authors, the 2010 Dodd– similar FSOC authority for financial market utili- Frank Act did not end “too big to fail.” In fact, ties (FMUs); restructure the Consumer Financial Dodd–Frank actually helps to enshrine too-big- Protection Bureau (CFPB); repeal the Volcker Rule; to-fail policies in law, particularly by allowing the and implement a regulatory of-ramp.14 Financial Stability Oversight Council (FSOC) to publicly identify firms it views as too big to fail and According to the OMB, restructuring CFPB would by using a taxpayer-supported resolution pro- save $147 million in FY 2019 during the first year cess called orderly liquidation authority (OLA) to of the transition, and these savings would grow to resolve failing firms. $610 million in FY 2020.15 According to a 2017 CBO estimate, ending OLA (and therefore the Orderly Provisions in the Financial CHOICE Act13 would Liquidation Fund) would save $30.1 billion in spend- FS remove the FSOC’s ability to identify these too-big- ing over 10 years while reducing revenues by just to-fail firms and would also repeal Dodd–Frank’s $5.9 billion. Implementation costs of $1.8 billion are OLA. Other CHOICE Act provisions would repeal estimated as well.16

ADDITIONAL READING " Norbert J. Michel, ed., The Case Against Dodd–Frank: How the “Consumer Protection” Law Endangers Americans, The Heritage Foundation, 2016. " Norbert J. Michel, ed., Prosperity Unleashed: Smarter Financial Regulation, The Heritage Foundation, 2017.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 145 The Heritage Foundation | heritage.org/BlueprintForBalance $700 MANDATORY SAVINGS IN MILLIONS17

Reform Fannie Mae and Freddie Mac

Mortgage securitizers Fannie Mae and Freddie limits, gradually reducing conforming loan limits, Mac—America’s largest government-sponsored and pricing guarantee fees more prudently. enterprises (GSEs)—imploded in 2008, trigger- ing a major recession and financial crisis in the According to the CBO, increasing the guarantee fee United States. Instead of shutting down these by five basis points from recent levels of just under failed companies, Congress chose to prop them 60 basis points would save $700 million in FY 2020. up indefinitely. A decade later, both GSEs remain Adjusting the loan limits for mortgages purchased under government conservatorship, with taxpay- by these GSEs would yield further savings. Cur- ers standing behind all of their obligations and the rently, high-cost areas are at $726,525 compared housing market even more distorted than it was with the standard elsewhere of $484,350. The CBO

FS leading into the crisis. The implicit federal guar- proposal eliminates the high-cost excess limits, antees behind the GSEs’ securities made housing setting a universal national maximum of $453,100 less afordable and contributed to the signiﬁcant in 2020 and ratcheting down this limit by 5 per- lowering of credit standards in the years preceding cent annually until it levels of at $300,000 in 2028. the crisis. The change in loan limits on its own saves $100 million in FY 2020. Both changes combined save History shows that the housing market does not $700 million.18 The CBO estimates that increasing need this type of government guarantee, and the guarantee fee would cause new guarantees to Congress should work to make housing more decline by 16 percent over 10 years. Merely reducing afordable by shrinking the federal role in housing loan limits would reduce new guarantees by 29 per- ﬁnance. A few basic reforms include eliminating the cent. Combining both changes would reduce new geographic price diferentials for conforming loan guarantees by 38 percent.19

ADDITIONAL READING " Joel Grifth and Norbert J. Michel, “Housing Finance Reform Possibilities Abound for 2019,” Heritage Foundation Backgrounder No. 3382, February 4, 2019.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

146 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $648 DISCRETIONARY SAVINGS IN MILLIONS20

Repeal the Rum Excise Tax Cover-Over

The top federal excise tax of $13.50 per proof-gallon to boost local production. The rum cover-over pro- is levied on distilled spirits.21 Of the federal excise gram has precipitated a rum-subsidies war between tax revenue collected from rum produced in Puerto the two territories. Rico, the U.S. Virgin Islands, or internationally, $13.25 per proof-gallon is transferred to the govern- The unintended consequences of the cover-over ments of Puerto Rico and the U.S Virgin Islands.22 program have led both Puerto Rico and the U.S. This transfer of revenue from the U.S. Treasury to Virgin Islands to manipulate their economies to other governments is called a cover-over. maximize federal subsidies. The ensuing subsidies race distorts the economy by placing continental Puerto Rico and the U.S. Virgin Islands each receive U.S. rum producers at a disadvantage, fuels local cor- the $13.25 of revenue collected from locally pro- ruption, and destabilizes local government budgets FS duced rum. The relative production between the due to constantly ﬂuctuating cover-over values. two territories determines the distribution of revenue from other imported rum. By producing more H.R. 3476, introduced in the 115th Congress, would rum, each territory has the ability to increase its repeal the cover-over of rum excise tax revenue.23 share of the cover-over, creating a strong incentive The bill did not receive a vote.

ADDITIONAL READING " Adam Michel, “Rum Taxes and Perverse Incentives,” Tax Foundation, July 10, 2014.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED Increases revenue from Puerto Rico by $413 million.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 147 The Heritage Foundation | heritage.org/BlueprintForBalance $588 MANDATORY (ONE-TIME) SAVINGS IN MILLIONS24

Rescind Unobligated Balances from the Treasury Forfeiture Fund

The Department of the Treasury Forfeiture Fund funding provided by the budget deal. Congress also receives proceeds from forfeitures made by partic- rescinds hundreds of millions of dollars from the ipating bureaus of the Department of the Treasury Forfeiture Fund each year through appropriations. and Department of Homeland Security. The fund The money is then used to increase other spending is used to reimburse expenses incurred by federal, within the Budget Control Act caps. state, and local law enforcement related to seizures and forfeitures. Congress should cap Treasury Forfeiture Fund spending at an appropriate level and use any unobli- However, the Forfeiture Fund has become another gated balances to reduce the debt. Unobligated means for Congress to pay for unrelated spending. balances should not be used to increase discretion-

FS The Bipartisan Budget Act of 2013 rescinded $867 ary spending. million from the fund to partially ofset the new

ADDITIONAL READING " Justin Bogie, “Budget Gimmicks Increase Federal Spending and Mask True Costs of Legislation,” Heritage Foundation Backgrounder No. 3234, July 26, 2017.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

148 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 FS

149 26 27 Congress should prohibit the should prohibit the Congress from being coerced by the government the government from being coerced by

Policymakers can advance school choice by can advance school choice by Policymakers The RHNDA speciﬁcally prohibits employers from prohibits employers speciﬁcally The RHNDA 25 A FEDERAL BUDGET FOR FISCAL YEAR 2020 heritage.org/BlueprintForBalance Blueprint for Balance: beliefs about human sexuality and recognize LGBT student groups or host “gay pride” days on campus. pride” days “gay groups or host recognize LGBT student beliefs about human sexuality and betrays human dignity and equality before the law. human dignity betrays funding for D.C.’s public charter schools, and an additional $20 million for the D.C. public school system. and an additional $20 million for the D.C. public charter schools, funding for D.C.’s private school of choice. Because the District of Columbia falls under the jurisdiction of Congress, it is it is falls under the jurisdiction of Congress, of Columbia District private school of choice. Because the schools in the three-sector approach and use it to fund additional scholarships for students to attend a to attend and use it to fund additional scholarships for students schools in the three-sector approach of the parents’ choice. When the OSP was created in 2003, Congress funded the new school choice option Congress funded the new school choice option created in 2003, was of the parents’ choice. When the OSP expanding access to the OSP through existing funding authorized by the D.C. School Choice Incentive Act. School Choice Incentive the D.C. by funding authorized existing expanding access to the OSP through discriminating in “compensation, terms, conditions or privileges of employment” on the basis of an or privileges on conditions of employment” terms, “compensation, discriminating in Expand the D.C. Opportunity Scholarship Program. Opportunity Expand the D.C. Protect freedom of conscience and life in the District of Columbia. of Columbia. in the District and life freedom of conscience Protect appropriate for the federal government to fund the OSP. According to one study, 91 percent of students who students 91 percent of According to one study, to fund the OSP. appropriate for the federal government and the doctor–patient relationship, compromises the family and intergenerational commitments, and compromises the family and intergenerational commitments, relationship, and the doctor–patient than the rate for a control group of peers who were awarded but did not use a scholarship. but did not peers who were awarded than the rate for a control group of through the “three-sector” approach: $20 million in funding for the OSP, $20 million in supplemental $20 million in supplemental through the “three-sector” approach: $20 million in funding for the OSP, their beliefs about human sexuality. Repeal of this protection could force Christian schools to violate their could force Christian Repeal of this protection their beliefs about human sexuality. used a voucher to attend a private school of choice graduated high school: a rate 21 percentage points higher to attend used a voucher into “promoting, encouraging, or condoning any homosexual act, lifestyle, orientation, or belief” homosexual act, lifestyle, encouraging, or condoning any into “promoting, if it violates individual’s “reproductive health decision making,” including the “termination of a pregnancy.” It could a pregnancy.” including the “termination of health decision making,” “reproductive individual’s for abortion. individuals who advocate require pro-life organizations to hire not to facilitate them. to not liberty and the exercise of conscience in the District. The government’s role should be to prevent suicides, suicides, be to prevent role should The government’s of conscience in the District. liberty and the exercise POLICY RIDERS POLICY The Heritage Foundation | Federal policymakers should shift a portion of the additional federal funding provided to traditional public to traditional policymakers provided should shift a portion of the additional federal funding Federal D.C.’s Death with Dignity Act Death with medicine the practice of endangerscorrupts the weak and vulnerable, D.C.’s District of Columbia from using any federal or local funding to implement or enforce the Death with Dignity the Death with or enforce funding to implement federal or local any from using of Columbia District The OSP provides scholarships that enable children from low-income D.C. families to attend a private school families to attend D.C. low-income scholarships that enable children from The OSP provides The HRAA repealed a policy that protected religious schools in D.C. The HRAA repealed a policy that protected (RHNDA) and Human Rights Amendment Act and Human could interfere with religious which potentially (HRAA), (RHNDA) Act, which permits physician-assisted suicide, as well as the Reproductive Health Nondiscrimination Act Health as well as the Reproductive suicide, Act, physician-assisted which permits FS 4. 7. 3. 150 2. 11. 10. 1. 17. 16. 15. 14. 13. 12. ENDNOTES 9. 6. The Heritage Foundation | Foundation Heritage The 5. 8.

Appropriations Act, 2019. Heritageexperts assume that FY2019 spendingremains constant inFY2020. The Honorable LindaSpringer, The Honorable Donald J. Devine, The Honorable DanG.Blair, and Estimated savings of$80millionfor FY2020 are basedonTable 2,“Estimated AnnualLoan Volume andBudgetary Costs Estimated savings of$250millionfor FY2020 are basedontheFY2019 appropriated level asspecifiedinH.J.Res. 31,Consolidated Congressional Budget Ofce, Justin Bogie, David R.Burton, andNorbertJ. Michel,“2017 HouseFinancialServices andGeneral Government Bill:Reduces Estimated savings of $10 millionfor FY2020 are basedonnews release, “Johnson, Meadows Introduce Billto Eliminate Congressional Budget Ofce, “H.R.10, FinancialCHOICEAct of2017.” See H.R.10, FinancialCHOICEAct of2017, 115thCong., https://www.congress.gov/bill/115th-congress/house-bill/10 (accessed March 29, H.R. 6147, Interior, Environment, FinancialServices andGeneral Government, Agriculture, Rural Development, Food Estimated savings of$700 millionfor FY2020 are basedonCongressional Budget Ofce, Table S-6,“Mandatory andReceipt Proposals,” in Ofce ofManagement andBudget, Norbert J. Michel,“Money Provisions andBanking intheFinancial CHOICEAct: AMajorStep Estimated savings of $1.88 billionfor FY2020 are basedonCongressional Budget Ofce, “H.R.10, FinancialCHOICEAct News release, “Johnson, Meadows Introduce Billto Eliminate Failed Obamacare Program.” Robert Emmet MoftandNeilR.Meredith, “Multistate HealthPlans:Agents for Competition orConsolidation?” Mercatus Center at George Estimated savings of$1.716 billionfor FY2020 are basedontheCBO’s May 2018 baselinespendingprojections. SeeCongressional Budget Estimated savings of$69 millionfor FY2020 are basedontheFY2019 appropriated level of$1.675 billionas (accessed March 29, 2019). (accessed March 29, 2019). 2018, https://www.cbo.gov/about/products/budget-economic-data#9 (accessed March 29, 2019). 2019). 2020. Total savings of$1.88 billioninclude$2.17 billioninreduced budget authority, ofset by $295 millioninreduced revenues. 2019), whichestimates that underfair-value accounting, eliminating theExport–Import would Bank have resulted insavings of$1.6 billion 2024,” inDouglasW. Elmendorf, Director, Congressional Budget Ofce, “Estimates oftheCost oftheCredit Programs ofthe of 2017, asOrdered Reported by theHouseCommittee onFinancialServices onMay 4, 2017,” eliminating MSPadministrative costs, includingsalariesandexpenses. committee staf estimated aninitialannualsavings of$10 millionfrom elimination oftheMSPprogram. This estimate comes from operating at fullcapacity; lackingaboard quorumfor thepast four years, ithasbeenunableto finance dealsinexcess of$100 million. over the2015–2024 period,or$160 millionperyear. We estimate halfofthislevel ofsavings for FY2020 becausethebankhasnotbeen of theCredit Programs oftheExport–Import oftheUnited Bank States UnderFCRA andtheFair-Value Approach, 2015 to spending remains constant inFY2020. This proposal would reduce theSEC budget to itsinflation-adjusted FY2018 spendinglevel, which specified inH.J.Res. 31,Consolidated Appropriations Act, 2019, Law Public 116-6,116thCong., February 15, 2019, Ofce, “The Budget andEconomic Outlook:2018 to 2028: Budget andEconomic Data: SpendingProjections, by Budget Account,” May and NorbertMichel,“Budget Reconciliation: AViable Path for CHOICEAct Reforms,” and DrugAdministration, andTransportation, HousingandUrbanDevelopment Appropriations Act, 2019, 115thCong., Spending, ButDoesNotGoFar EnoughonPolicy Changes,” HeritageFoundation would be$1.653 billionfor FY2020. report assumes implementation inOctober 2019, sowe usedits2020 estimated fiscal impacts asthebasis ofourestimate. December 2018, pp. 23–24, https://www.cbo.gov/system/files?file=2018-12/54667-budgetoptions.pdf (accessed March 29, 2019). The CBO Mason University, Markets?” HeritageFoundation Robert E.Moft,“The O fce ofPersonnel Management: APower Player inAmerica’s HealthInsurance March 29, 2019). Aspartoftheiroversight responsibilities and usingprogram data suppliedby theU.S. Ofce ofPersonnel Management, Failed Obamacare Program,” Committee onHomelandSecurity andGovernmental A fairs, U.S. Senate, December 12,2017, Export–Import Bank,” testimony before theCommittee onFinancialServices, U.S. HouseofRepresentatives, June25, 2014, p. 6, in theRight Direction,” HeritageFoundation implementation inlate 2017, sowe usedits2019 estimated fiscalimpacts asthefirst year ofimplementation andappliedthosefigures to FY https://www.govinfo.gov/content/pkg/BUDGET-2019-BUD/pdf/BUDGET-2019-BUD.pdf (accessed March 29, 2019). https://www.forbes.com/sites/norbertmichel/2017/09/04/budget-reconciliation-a-viable-path-for-choice-act-reforms/#5e406c09496f https://www.heritage.org/markets-and-finance/report/money-and-banking-provisions-the-financial-choice-act-major-step-the, https://www.cbo.gov/system/files/115th-congress-2017-2018/costestimate/hr10.pdf (accessed March 29, 2019). The CBO report assumes https://www.congress.gov/bill/115th-congress/house-bill/6147 (accessed March 29, 2019). http://www.heritage.org/research/lecture/the-ofce-of-personnel-management-a-power-player-in-americas-health-insurance-markets. https://www.hsgac.senate.gov/media/majority-media/johnson-meadows-introduce-bill-to-eliminate-failed-obamacare-program (accessed https://www.cbo.gov/sites/default/files/113th-congress-2013-2014/reports/45383-fairvalue.pdf (accessed March 28,2019). https://www.cbo.gov/sites/default/files/113th-congress-2013-2014/reports/45468-exportimportbanktestimony.pdf (accessed March 28, http://thf-reports.s3.amazonaws.com/2016/IB4591.pdf. https://www.congress.gov/bill/116th-congress/house-joint-resolution/31 (accessed March 28,2019). Heritageexperts assume that FY2019 Working Paper Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance Fair-Value Estimates of theCost of Selected Federal Credit Programs for 2015 to 2024 Lecture , January2015, p. 4, https://pdfs.semanticscholar.org/cddc/248c94214b0681a4cc6b4a275b7e03d7c421.pdf No. 1145, February 19, 2010 (delivered January20, 2010), Backgrounder A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A No. 3152, August 31,2016, Issue Brief Forbes Fiscal Year 2019 Budget of the U.S. Government Options for Reducing the Deficit:2019 to 2028 , September 4, 2017, No. 4591, July7, 2016, Cost Estimate , May 18,2017, , May 2014, p. 1, , p. 136, , FS

151 Evaluation of the DC Opportunity Opportunity the DC of Evaluation , September 20, 2012, 2012, 20, , September No. 3004, March 24, 2015, 2015, 24, March 3004, No. Report for Congress for Report Backgrounder No. 4364, March 9, 2015, 2015, 9, March 4364, No. A FEDERAL BUDGET FOR FISCAL YEAR 2020 Issue Brief Issue , U.S. Department of Education, Institute of Education Sciences, National Center for Education Evaluation Evaluation Education for Center National Sciences, of Education Institute of Education, Department , U.S. heritage.org/BlueprintForBalance Blueprint for Balance: http://www.heritage.org/research/reports/2015/03/congress-should-protect-religious-freedom-in-the-district-of-columbia. https://www.heritage.org/health-care-reform/report/always-care-never-kill-how-physician-assisted-suicide-endangers-the-weak. https://www.congress.gov/bill/115th-congress/house-bill/3476 (accessed March 29, 2019). 29, March (accessed https://www.congress.gov/bill/115th-congress/house-bill/3476 https://www.everycrsreport.com/files/20120920_R41028_8ed3e4082e0a7b38896700009cd3ab48474db864.pdf (accessed March 29, 29, March (accessed https://www.everycrsreport.com/files/20120920_R41028_8ed3e4082e0a7b38896700009cd3ab48474db864.pdf Budget Account,” January 2019, https://www.cbo.gov/about/products/budget-economic-data#9 (accessed March 29, 2019). 29, March (accessed https://www.cbo.gov/about/products/budget-economic-data#9 January 2019, Account,” Budget the District of Columbia,” Heritage Foundation Heritage Foundation of Columbia,” the District the Family, and Violates Human Dignity and Equality,” Heritage Foundation Heritage Foundation and Equality,” Human Dignity and Violates the Family, and Regional Assistance, NCEE 2010-4018, June 2010, https://ies.ed.gov/ncee/pubs/20104018/pdf/20104018.pdf (accessed March 29, 2019). 29, March (accessed https://ies.ed.gov/ncee/pubs/20104018/pdf/20104018.pdf June 2010, NCEE 2010-4018, Assistance, and Regional ce, “The Budget and Economic Outlook: 2019 to 2029: Budget and Economic Data: Spending Projections, by by Projections, Spending Data: and Economic Budget 2029: to Outlook: 2019 Economic and Budget “The Ofce, Budget Congressional Over: Legislative History and Current Issues,” Congressional Research Service Service Research Congressional Issues,” Current and History Legislative Over: 115-97, 115th Cong., December 22, 2017, https://www.congress.gov/bill/115th-congress/house-bill/1/text (accessed March 29, 2019). 29, March (accessed https://www.congress.gov/bill/115th-congress/house-bill/1/text 22, 2017, December 115th Cong., 115-97, extension of the higher rate ends on December 31, 2022. ends on December higher rate of the extension 2019). FY 2011 data were adjusted for inflation to determine estimated savings of $648 million in 2020. savings estimated determine to inflation for adjusted were data FY 2011 2019). Patrick Wolf, Babette Gutmann, Michael Puma, Brian Kisida, Lou Rizzo, Nada Eissa, and Matthew Carr, Carr, and Matthew Nada Eissa, Rizzo, Gutmann, Michael Puma, Brian Kisida, Lou Babette Wolf, Patrick Estimated savings of $588 million for FY 2020 are based on the CBO’s most recent January 2019 baseline spending projections. See baseline spending projections. January 2019 recent most CBO’s based on the are FY 2020 for million of $588 savings Estimated Ryan T. Anderson, “Always Care, Never Kill: How Physician-Assisted Suicide Endangers the Weak, Corrupts Medicine, Compromises Compromises Medicine, Corrupts the Weak, Suicide Endangers Physician-Assisted Kill: How Never Care, “Always Anderson, T. Ryan in Freedom Religious Should Protect “Congress Torre, and Sarah Anderson T. Ryan A temporary lower tax rate of $2.70 per proof-gallon applies to the first 100,000 gallons of production for the 2018–2019 tax year. See H.R. 1, year. tax the 2018–2019 for gallons of production 100,000 the first to applies per proof-gallon of $2.70 rate tax lower A temporary current The 1999. basis since temporary on a recurring, $13.25 to $2.75 by has been increased of $10.50 level cover-over permanent The 115th Cong., Revenue, Tax of Rum Excise the Cover-Over Repeal of 1986 to Code Revenue the Internal Amend To H.R. 3476, Estimated savings of $648 million for FY 2020 are based on [Name redacted on web site], “The Rum Excise Tax Cover- Tax Rum Excise “The site], on web on [Name redacted based are 2020 FY of $648 million for savings Estimated Ibid. Ibid. Scholarship Program: Final Report Program: Scholarship An Act to Provide for Reconciliation Pursuant to Titles II and V of the Concurrent Resolution on the Budget for Fiscal Year 2018, Public Law Public Law 2018, Fiscal Year for the Budget on Resolution II and V of the Concurrent Titles to Pursuant Reconciliation for Provide to An Act

18. 19. 27. 26. 25. 23. 24. 22. 21. 20. The Heritage Foundation |

Homeland Security The Heritage Foundation | heritage.org/BlueprintForBalance $700 DISCRETIONARY SAVINGS IN MILLIONS1

Eliminate FEMA’s Fire Grants

Assistance to Firefighters Grants (AFGs) subsidize emergencies reported by fire departments. Using the routine activities of local fire departments panel data from 1999 to 2006 for more than 10,000 and emergency management organizations. Fire fire departments, the evaluation assessed the impact Prevention and Safety (FP&S) grants fund projects of fire grants on firefighter deaths, firefighter inju- to improve firefighter safety and protect the public ries, civilian deaths, and civilian injuries, comparing from fire and related hazards. Stafng for Adequate fire departments that received grants to depart- Fire and Emergency Response (SAFER) grants ments that did not receive grants. It also assessed fund career firefighters’ salaries and volunteer fire the impact of the grants before and after grant- departments’ recruitment activities in order to funded fire departments received federal assistance. increase stafng levels. The evaluation showed that AFG, FP&S, and SAFER grants failed to reduce firefighter deaths, firefighter The Heritage Foundation’s Center for Data Analysis injuries, civilian deaths, and civilian injuries. Com- evaluated the program’s efectiveness by match- parison fire departments that did not receive grants ing grant award data to the National Fire Incident were just as successful at preventing fire casualties Reporting System, a database of fire-related as were grant-funded fire departments. HS

ADDITIONAL READING " David B. Muhlhausen, “Do DHS Fire Grants Reduce Fire Casualties?” Heritage Foundation Center for Data Analysis Report No. 09-05, September 23, 2009. " David B. Muhlhausen, “Fire Grants: Do Not Reauthorize an Inefective Program,” Heritage Foundation Issue Brief No. 3788, November 29, 2012.

PROPOSAL STATUS EXPLANATION

Cuts and institutes cost shares for other grant programs President’s Budget (FY2020) REJECTED but not for ﬁre grants speciﬁcally.

154 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $850 DISCRETIONARY SAVINGS IN MILLIONS2

Reduce Funding for FEMA’s Disaster Relief Fund

Throughout most of U.S. history, state and local gov- governments would enable Washington to reduce ernments were responsible for responding to nearly federal disaster relief spending by at least $850 mil- all disasters. Under President Ronald Reagan, FEMA lion in FY 2020, with more savings in future years. averaged 28 federal disaster declarations a year. After First, Congress should increase the Staford Act passage of the amended Staford Act in 1988, the threshold to require $3 per capita in damages with number rose dramatically: Under President Barack a $5 million minimum threshold and a $50 million Obama, approximately 120 disasters were declared maximum threshold. Second, the FEMA cost share each year. Two provisions of the Staford Act are to should be reduced from between 75 percent and 100 blame for this: One shifts most of the costs of a feder- percent to 25 percent, with a greater cost share for alized disaster to the federal government; the other large catastrophes. For disasters that top $5 billion, makes it relatively easy for a regional or localized the cost-share provision should increase gradually disaster to qualify as a federal disaster. as the cost of the disaster increases. This gradual increase in cost sharing should be capped at 75 per- Reforming the Staford Act to return more cent once a disaster tops $20 billion.

responsibility for disaster relief to state and local HS

ADDITIONAL READING " David Inserra, “FEMA Reform Needed: Congress Must Act,” Heritage Foundation Issue Brief No. 4342, February 4, 2015.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 155 The Heritage Foundation | heritage.org/BlueprintForBalance $470 DISCRETIONARY SAVINGS IN MILLIONS3

Privatize Transportation Security Administration Screening Functions

The TSA model is costly and unwisely makes the test airports for compliance. Alternatively, it could TSA both the regulator and regulated organization adopt a Canadian-style system, turning over screen- responsible for screening operations. With Pres- ing operations to a new government corporation ident Donald Trump promising to shrink federal that contracts screening service to private contrac- bureaucracies and bring private-sector knowhow tors. Contractors would bid to provide their services to government programs, the TSA is ripe for reform. to a set of airports in a region, likely with around The U.S. should look to the Canadian and European 10 regions. The TSA would continue to set security private models of providing aviation screening regulations and test airports for compliance, and manpower to lower TSA costs while maintain- the new corporation would establish any operating ing security. procedures or customer service standards.

More speciﬁcally, the TSA could privatize the Some of this funding should be used to reduce screening function by expanding the current airport security fees for travelers. The government Screening Partnership Program (SPP) to all airports. could expect to save at least 10 percent from the The TSA would turn screening operations over to existing aviation screening budget, but savings HS airports that would choose security contractors could be signiﬁcantly larger. that meet TSA regulations and would oversee and

ADDITIONAL READING " David Inserra, “Time to Privatize the TSA,” Heritage Foundation Backgrounder No. 3120, July 19, 2017.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

156 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $700 DISCRETIONARY SAVINGS IN MILLIONS4

Reform Payments from the National Flood Insurance Program

The federal government holds a monopoly on NFIP policies. Insurers receive a generous com- primary flood insurance for homeowners and mission of 15 percent of net written premiums and businesses, and the program is debt-ridden and may also receive a bonus for meeting sales goals. dysfunctional. Because a large proportion of the (According to the Government Accountability Ofce, government’s flood-risk maps are obsolete, the pre- the government lacks the information necessary to miums charged under the NFIP do not reflect actual determine whether its compensation payments are risk. Artificially low premiums promote overdevel- appropriate.5) opment in flood-prone areas, which worsens the devastation of natural disasters and dramatically Instead of paying private insurers to sell govern- increases the recovery costs borne by taxpayers. ment policies, Congress should phase out the NFIP in favor of a private insurance market. The first step The Federal Emergency Management Agency has is to allow private insurance to satisfy federal loan repeatedly proven its inability to manage flood requirements, after which there should be a mora- mapping properly. Therefore, the Flood Hazard torium on government policies for newly acquired

Mapping Program should be eliminated ($168 mil- properties (after a date certain). FEMA should also HS lion), and responsibility for risk mapping should be put out for bid a portion of the insurance pool each shifted to private insurers. year. At the very least, the NFIP should be barred from insuring any property with lifetime losses that, The government already contracts with private in the aggregate, exceed twice the amount of the property and casualty insurers to sell and service replacement value of the structure.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 157 HS Justice.” Act (TVPRA) of2008toallow rapidrepatriationofunaccompaniedchildren fromcountriesthatarenon- Act Judiciously expand andrenametheVisa Waiver Program. Many publicevents andcriticalinfrastructure large facilitiesbeyondfederalinstallations willneed House andoneintheSenate,withsomeadditionaloversight bycommittees theintelligence andhomeland Homeland Securitytoraisethe3percentrefusal rateto10percentifacountryhaslow visa-overstay 158 Congress ortheDepartmentofHomeland SecurityshouldrenametheVWP. Onerecommendationis variety ofdiferentlocalpartners, usinganarray ofapproved technologiesatdiverse venues andfacilities. violations ofimmigrationlaw. CongressshouldreformtheTrafckingVictimsProtection Reauthorization Create a Counter-Unmanned Aerial SystemsCreate aCounter-Unmanned Aerial pilot programforstate andlocallaw enforcement. Close immigrationloopholes. POLICY RIDERS new lives thandothoseresettled by thegovernment alone.Congressshouldamendexistinglaw to refugee reciprocal, mutuallybeneficialnatureoftheprogramanditsimportancetoU.S. security. rate. Inaddition,because“visaisoftenincorrectlyassociatedwithlaxvetting waiver” offoreigntravelers, regulations andrulesby theDepartmentofHomeland Security, andallprogramparticipantsshouldbe issues, theU.S. shoulddesigntheprogramtoensurethatprivatesponsorsdonot shouldertheburdenof shouldbeallowedrefugees by taking5,000 spots refugee fromnext year’s U.S. Program Admissions Refugee these programs, andincludea mechanismtoexpandtheprograms. For example,ifprivateresettlement is to renametheprogramPartnership forSecureTravel (PST),adesignationthatrecognizesboth the agencies totrainanddeputizeparticularofcersfulfillCUASagencies responsibilitiesunderthedirection an oversight structure thatresemblestheonegoverning other criticaldepartments, suchasDefenseand Establish privaterefugee-resettlement pilot programs. of federalauthorities. Thepilot programshouldstart afterthecompletion andpromulgationofCUAS onerous medicalcosts. quota. withsignificanthealth Inaddition,becauseitisdifcultforprivatesponsorstosupportarefugee capped at5,000 but10,000 thenanadditional5,000 privatebenefactorswant tosponsorarefugee, private establish privateresettlement pilot programs, set thatareallowed thenumberofrefugees toparticipatein contiguous withtheU.S. totheirhomecountries. children toremainwiththeirparentswhileawaiting asylum adjudication orprosecutionofmisdemeanor The Heritage Foundation | Foundation Heritage The subject totheseregulations. Thepilot program shouldrequiretheDHStoenterintoagreementswitha security appropriationssubcommittee inboth chambers. private resettlement program have better assimilationoutcomesandreportgreatersatisfaction withtheir program, whichwouldallow theDHStoenterintoagreementswithstate andlocal law enforcement protection fromdrone-basedattacks. Congressshouldcreateapilot programmodeledafterthe287(g) Streamline congressionaloversight ofDHS. 7 Thismeansplacingoversight ofDHSunderoneprimaryhomelandsecuritycommittee inthe Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance 9 Congress shouldrejectthe A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A As theAspenInstitute putitin2013, “DHSshouldhave 8 Flores Refugees resettledRefugees toCanadathrough its Congress shouldallow theSecretary of settlement inordertoallow accompanied 6 10 HS

159 No. 4912, 4912, No. Backgrounder Issue Brief Issue , September 2017, 2017, , September , September 2013, p. 4, 4, p. 2013, , September 3305, April 16, 2018, April 16, 2018, 3305, No. 4812, January 26, 2018, 2018, 4812, January 26, No. Backgrounder A FEDERAL BUDGET FOR FISCAL YEAR 2020 Issue Brief Issue Task Force Report on Streamlining and Consolidating and Consolidating on Streamlining Report Force Task heritage.org/BlueprintForBalance Blueprint for Balance: ordability f and A Financial Soundness Program: Flood Insurance National The No. 3212, July 5, 2017, https://www.heritage.org/immigration/report/the-us-refugee-admissions-program-roadmap-reform. 2017, July 5, 3212, No. https://www.heritage.org/technology/report/establishing-legal-framework-counter-drone-technologies. https://www.heritage.org/homeland-security/report/advancing-american-security-economic-and-foreign-policy-interests-through https://www.heritage.org/homeland-security/report/advancing-american-security-economic-and-foreign-policy-interests-through 2019). 13, March (accessed https://assets.aspeninstitute.org/content/uploads/files/content/docs/pubs/Sunnylands%20report%2009-11-13.pdf https://www.cbo.gov/system/files?file=115th-congress-2017-2018/reports/53028-nfipreport2.pdf (accessed March 13, 2019). This report report This 13, 2019). March (accessed https://www.cbo.gov/system/files?file=115th-congress-2017-2018/reports/53028-nfipreport2.pdf https://www.congress.gov/bill/116th-congress/house-joint-resolution/31 (accessed March 13, 2019). The AFG and SAFER programs each programs and SAFER AFG The 13, 2019). March (accessed https://www.congress.gov/bill/116th-congress/house-joint-resolution/31 in H.J.Res. 31, Consolidated Appropriations Act, 2019, Public Law 116-6, 116th Cong., February 15, 2019, 2019, 15, February Cong., 116-6, 116th Public Law 2019, Act, Appropriations Consolidated 31, in H.J.Res. Revising Its Compensation Methodology, GAO-17-36, December 2016, https://www.gao.gov/products/GAO-17-36 (accessed March 15, 2019). 15, March (accessed https://www.gao.gov/products/GAO-17-36 2016, December GAO-17-36, Methodology, Its Compensation Revising No. 3120, July 19, 2017, https://www.heritage.org/homeland-security/report/time-privatize-the-tsa. Estimated savings are based on likely based on likely are savings Estimated https://www.heritage.org/homeland-security/report/time-privatize-the-tsa. 2017, July 19, 3120, No. Ofce, Budget the Visa Waiver Program,” Heritage Foundation Heritage Foundation Program,” Waiver the Visa their budget authority as authorized and found in the Consolidated Appropriations Act, 2019. Act, Appropriations in the Consolidated and found as authorized authority their budget for Counter-Drone Technologies,” Heritage Foundation Heritage Foundation Technologies,” Counter-Drone for received $350 million in appropriations for FY 2019. Heritage experts assume that the FY 2019 levels remain constant in FY 2020. constant remain levels the FY 2019 that assume experts Heritage FY 2019. for million in appropriations $350 received October 24, 2018, https://www.heritage.org/immigration/report/immigration-law-and-enforcement-dire-need-clarity-and-major-overhaul. 2018, 24, October Backgrounder savings equal to half of the NFIP’s costs in FY 2020. In later years, savings would equal the full cost of the NFIP. equal the full cost would savings years, In later in FY 2020. costs half of the NFIP’s equal to savings spending reductions from implementing a private screener system similar to the Canadian model. similar to system screener a private implementing from spending reductions estimates that the NFIP costs $1.4 billion per year. We estimate that a shift to a fully privatized flood insurance market would result in result would market flood insurance a fully privatized a shift to that estimate We billion per year. $1.4 the NFIP costs that estimates (accessed March 13, 2019). March (accessed Estimated savings of $850 million for FY 2020 are a Heritage estimate of potential savings based on current disaster relief programs and and programs relief disaster based on current savings of potential a Heritage estimate are FY 2020 for of $850 million savings Estimated Olivia Enos, David Inserra, and Joshua Meservey, “The U.S. Refugee Admissions Program: A Roadmap for Reform,” Heritage Foundation Heritage Foundation Reform,” for A Roadmap Program: Admissions Refugee U.S. “The and Joshua Meservey, Inserra, Olivia Enos, David Estimated savings of $700 million for FY 2020 are based on the FY 2019 appropriated level as specified as specified level appropriated 2019 based on the FY are FY 2020 million for of $700 savings Estimated Jason Snead, John-Michael Seibler, and David Inserra, “Establishing a Legal Framework Framework a Legal “Establishing Inserra, and David Jason Snead, John-Michael Seibler, Aspen Institute, Justice and Society Program, Program, and Society Justice Aspen Institute, Estimated savings of $700 million for FY 2020 are based on Heritage estimates using data from Congressional Congressional from using data on Heritage estimates based are FY 2020 million for of $700 savings Estimated David Inserra, “Advancing American Security, Economic, and Foreign Policy Interests Through Through Interests Policy and Foreign Economic, American Security, “Advancing Inserra, David David Inserra, “Immigration Law and Enforcement in Dire Need of Clarity and Major Overhaul,” Heritage Foundation Heritage Foundation and Major Overhaul,” Need of Clarity in Dire and Enforcement Law “Immigration Inserra, David ce, Flood Insurance: FEMA Needs to Address Data Quality and Consider Company Characteristics When When Characteristics Company and Consider Quality Data Address to FEMA Needs Flood Insurance: Ofce, Accountability Government U.S. Estimated savings of $470 million for FY 2020 are based on David Inserra, “Time to Privatize the TSA,” Heritage Foundation Heritage Foundation the TSA,” Privatize to “Time Inserra, based on David are FY 2020 million for of $470 savings Estimated Congressional Oversight of the U.S. Department of Homeland Security of Department U.S. the of Oversight Congressional

8. 5. 6. 9. ENDNOTES 10. 1. 2. The Heritage Foundation | 3. 7. 4.

Interior, Environment, and Related Agencies The Heritage Foundation | heritage.org/BlueprintForBalance $89.5 DISCRETIONARY SAVINGS IN MILLIONS1

Reduce Funding for the EPA’s Atmospheric Protection Program

The EPA’s Research and Technology budget sup- duplicate the Federal Vehicle and Fuels Standards ports science, technology, monitoring, research, and Certification program. The Environmental Pro- contracts and grants, intergovernmental agree- gram and Management portion of EPA’s budget for ments, and purchases of scientific equipment. The the Atmospheric Protection Program should also science and technology account for the Air Protec- be reduced to eliminate the ENERGY Star program, tion Program supports the EPA’s fuel economy and which can be maintained efectively as an indepen- greenhouse gas vehicle emissions standards, which dent nonprofit organization.

ADDITIONAL READING " Diane Katz, “An Environmental Policy Primer for the Next President,” Heritage Foundation Backgrounder No. 3079, December 14, 2015. " “Environmental Protection Agency,” in The Heritage Foundation, Blueprint for Reform: A Comprehensive Policy Agenda for a New Administration in 2017, Mandate for Leadership Series, 2016, pp. 94–98. " Salim Furth and David W. Kreutzer, “Fuel Economy Standards Are a Costly Mistake,” Heritage Foundation Backgrounder No. 3096, March 4, 2016, http://thf-reports.s3.amazonaws.com/2016/BG3096.pdf. INT/ENV

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

162 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $17 DISCRETIONARY SAVINGS IN MILLIONS2

Eliminate the EPA’s Radon and Indoor Air Programs

The most pressing indoor air issues relate to asthma, customize policies to meet local conditions. A less which should be addressed by state public health centralized regime would also mean more direct departments, not by the EPA. Federal bureaucrats accountability: Taxpayers could more easily identify hardly possess sufcient information and expertise the ofcials responsible for environmental policies, to impose controls on hundreds, if not thousands, of and the people making those regulatory decisions dissimilar locations across the 50 states. States and would have to live with the consequences. individual property owners are better equipped to

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 163 The Heritage Foundation | heritage.org/BlueprintForBalance $94.2 DISCRETIONARY SAVINGS IN MILLIONS3

Eliminate Federal Vehicle and Fuels Standards and Certiﬁcation

This program involves a variety of activities to Congress ultimately should retire vehicle fuel develop, test, implement, and enforce pollution economy standards and clarify that the Clean Air emissions standards. In addition to pollution Act does not cover greenhouse gases. This reduction control, this program administers the Renewable in spending is contingent on policy reform that Fuel Standard (RFS), fuel economy standards, and eliminates CAFE, RFS, and regulation of green- greenhouse gas emissions. The RFS is costly, is house gases. inefective, and needlessly interferes in fuel supply. Fuel economy is the statutory responsibility of the National Highway Trafc Safety Administration.

ADDITIONAL READING " Diane Katz, “An Environmental Policy Primer for the Next President,” Heritage Foundation Backgrounder No. 3079, December 14, 2015. " “Environmental Protection Agency,” in The Heritage Foundation, Blueprint for Reform: A Comprehensive Policy Agenda for a New Administration in 2017, Mandate for Leadership Series, 2016, pp. 94–98. " Salim Furth and David Kreutzer, “Fuel Economy Standards Are a Costly Mistake,” Heritage Foundation Backgrounder No. 3096, March 4, 2016, http://thf-reports.s3.amazonaws.com/2016/BG3096.pdf. INT/ENV

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending. INCLUDED

164 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $17.1 DISCRETIONARY SAVINGS IN MILLIONS4

Reduce Funding for the EPA’s Air and Energy Research Program

The EPA’s Research and Technology budget sup- be reduced to eliminate climate change research, ports science, technology, monitoring, research, which duplicates work being done at the National contracts and grants, intergovernmental agree- Oceanic and Atmospheric Administration. EPA’s ments, and purchases of scientiﬁc equipment. research portfolio should be refocused on the EPA’s The Air and Energy Research program should core missions of air pollution and human health.

ADDITIONAL READING " Robert Gordon and Andrew Kloster, “Wage Garnishment Without a Court Order: Not a Good Idea,” Heritage Foundation Issue Brief No. 4275, September 29, 2014. " Diane Katz, “An Environmental Policy Primer for the Next President,” Heritage Foundation Backgrounder No. 3079, December 14, 2015. " Katie Tubb and Nicolas Loris, “Climate Budget Cuts Are Smart Management, Not an Attack on Science,” The Daily Signal, May 25, 2017. INT/ENV

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 165 The Heritage Foundation | heritage.org/BlueprintForBalance $17.6 DISCRETIONARY SAVINGS IN MILLIONS5

Reduce Funding for the EPA’s Sustainable and Healthy Communities Research Program The Sustainable and Healthy Communities research appropriately addressed at the state and local levels. program has expanded beyond the EPA’s core Activities and funds should be reduced to meeting responsibilities. Issues addressed by the program the needs of federal contaminated sites, toxicology, include managing municipal waste, storm water chemical and pesticide research, and hazardous runof, and trade-ofs in community planning for materials management. greenspace, schools, and public facilities that are

ADDITIONAL READING " Jack Spencer, ed., Environmental Conservation: Eight Principles of the American Conservation Ethic, The Heritage Foundation, 2012. " Diane Katz, “An Environmental Policy Primer for the Next President,” Heritage Foundation Backgrounder No. 3079, December 14, 2015. INT/ENV

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

166 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $8.7 DISCRETIONARY SAVINGS IN MILLIONS6

Eliminate the EPA’s Stratospheric Ozone Multilateral Fund

The EPA’s Stratospheric Ozone Multilateral Fund substances. Only 45.14 percent of ﬁnancial pledges was created by parties to the 1987 Montreal Pro- were made in 2018 by partnering nations, and the tocol to support eforts by developing countries to U.S. has long paid a disproportionate share of the phase out the use of stratospheric ozone-depleting funding.7

ADDITIONAL READING " Robert Gordon and Andrew Kloster, “Wage Garnishment Without a Court Order: Not a Good Idea,” Heritage Foundation Issue Brief No. 4275, September 29, 2014. " Diane Katz, “An Environmental Policy Primer for the Next President,” Heritage Foundation Backgrounder No. 3079, December 14, 2015. " Nicolas D. Loris and Brett D. Schaefer, “The Kigali Amendment Ofers Little Beneﬁt to the Climate, Great Cost to the U.S. Economy,” Heritage Foundation, Backgrounder No. 3309, April 30, 2018. " Ben Lieberman, “Ozone: The Hole Truth,” Heritage Foundation Commentary, September 14, 2007. INT/ENV

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 167 The Heritage Foundation | heritage.org/BlueprintForBalance $12.8 DISCRETIONARY SAVINGS IN MILLIONS8

Reduce the EPA’s Compliance Monitoring Program

The EPA’s compliance monitoring program state and local monitoring in recognition that states manages compliance with environmental laws, are better positioned to detect local violations and regulations, permits, and reporting requirements determine the infrastructure necessary for moni- through inspections, investigations, and monitoring. toring. The compliance monitoring program should It is inefcient for both the federal government and focus only on truly national and interstate environ- states to conduct compliance monitoring. Funding mental issues. should be reduced to eliminate redundancies with

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

168 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $7.5 DISCRETIONARY SAVINGS IN MILLIONS9

Eliminate the EPA’s Environmental Justice Programs

Regulatory priorities should be set by states on the Environmental justice programs also subsidize state basis of risks to human health and the environ- and local projects that federal taxpayers should not ment, not social factors. The EPA’s “environmental be forced to fund. For example, the Environmental justice” programs were originally designed to Justice Small Grants Program has funded neigh- protect low-income communities from environ- borhood litter cleanups and education on urban mental harm, but the EPA too often goes beyond gardening, composting, and the negative efects of this purpose to prevent job-creating businesses urban sprawl and automobile dependence. Con- from developing in low-income communities, thus gress should eliminate these programs. blocking the economic opportunity that these communities need.

ADDITIONAL READING

" Diane Katz, “An Environmental Policy Primer for the Next President,” Heritage Foundation Backgrounder No. 3079, December 14, 2015. " “Environmental Protection Agency,” in The Heritage Foundation, Blueprint for Reform: A Comprehensive Policy Agenda for a New Administration in 2017, Mandate for Leadership Series, 2016, pp. 94–98. INT/ENV

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending. INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 169 The Heritage Foundation | heritage.org/BlueprintForBalance $413.6 DISCRETIONARY SAVINGS IN MILLIONS10

Eliminate the EPA’s Geographic Programs

EPA funds a number of local environmental ini- responsibility of states, regional partnerships, and tiatives: the Chesapeake Bay, the Gulf of Mexico, the private sector. Lake Champlain, Long Island Sound, Puget Sound, San Francisco Bay, South Florida, the Great Lakes, Federal funding should be eliminated or reduced to the U.S.–Mexico border, Lake Pontchartrain Basin, the minimum required by existing legal settlements. the Northwest Forest Program, and the South- States could implement and expand user fees so that east New England Coastal Watershed Restoration the people who are using a resource are the ones Program. Coordination, protection, restoration, that beneﬁt from its maintenance and protection. and enhancement of these regions should be the

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

170 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $8.7 DISCRETIONARY SAVINGS IN MILLIONS11

Eliminate the EPA’s Environmental Education Program

The Environmental Education program provides school districts. A number of research studies have financial, training, and curriculum support to found that educational products produced by the schools, nonprofits, and local governments. Cur- agency are politicized and fail to emphasize scien- riculum content should be set by parents and local tific principles.

INT/ENV

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 171 The Heritage Foundation | heritage.org/BlueprintForBalance $1.6 DISCRETIONARY SAVINGS IN MILLIONS12

Eliminate the EPA’s Small Minority Business Assistance Program

The Small Minority Business Assistance program contracting assistance, and informational services. duplicates services available to all small businesses The EPA should not condition services or reward or through the Small Business Ombudsman program deny contracts based on race or gender. for advocacy, regulatory analysis, technical and

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

172 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $6.5 DISCRETIONARY SAVINGS IN MILLIONS13

Eliminate the EPA’s Children and Other Sensitive Populations Coordination Program The Children and Other Sensitive Populations EPA already incorporates into research, risk assess- Coordination program assists in regulations, risk ments, and regulation related to at-risk populations assessments, policy implementation, and monitor- as part of its mission to protect human health and ing with a particular focus on the health of children. the environment. This program essentially duplicates work that the

INT/ENV

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending. INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 173 The Heritage Foundation | heritage.org/BlueprintForBalance $5.5 DISCRETIONARY SAVINGS IN MILLIONS14

Eliminate the EPA’s Trade and Governance Program

The EPA contributes policy advice to the U.S. Trade environmental objectives should be considered Representative “to ensure that agreements have and implemented independently, not as a part of strong environmental provisions.”15 There is a trade negotiations. Too often, countries use poorly highly positive correlation between a country’s substantiated environmental concerns as an excuse environmental performance and its economic to shirk their obligations under the World Trade freedom, of which free trade is a critical component Organization and the General Agreement on Tarifs as demonstrated by The Heritage Foundation’s and Trade. annual Index of Economic Freedom. International

ADDITIONAL READING " Diane Katz, “An Environmental Policy Primer for the Next President,” Heritage Foundation Backgrounder No. 3079, December 14, 2015. " “Environmental Protection Agency,” in The Heritage Foundation, Blueprint for Reform: A Comprehensive Policy Agenda for a New Administration in 2017, Mandate for Leadership Series, 2016, pp. 94–98. " Jack Spencer, ed., Environmental Conservation: Eight Principles of the American Conservation Ethic, The Heritage Foundation, 2012. " Ben Lieberman, “A Free Economy Is a Clean Economy: How Free Markets Improve the Environment,” Chapter 4 in Terry Miller and Kim R. Holmes, 2011 Index of Economic Freedom (Washington: The Heritage Foundation and Dow Jones & Company, Inc., 2011), pp. 53–60. INT/ENV

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

174 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $0.3 DISCRETIONARY SAVINGS IN MILLIONS16

Reduce the EPA’s Civil Rights Program

The Civil Rights Program ensures compliance with Program funding should be reduced to eliminate civil rights and anti-discrimination laws in EPA state and local-level programs such as the State employment opportunities, ﬁnancial and technical Empowerment Initiative, which should remain assistance, and workforce complaint resolution. local priorities.

INT/ENV

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending but maintains state guidance INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 175 The Heritage Foundation | heritage.org/BlueprintForBalance $9.5 DISCRETIONARY SAVINGS IN MILLIONS17

Eliminate the EPA’s Waste Minimization and Recycling Program

The waste minimization program intends to help These programs do not contribute to actual cleanup companies ﬁnd ways to improve efciency and of hazardous waste; instead, they focus on pro- reuse waste products for productive purposes. The moting recycling and other activities that are best free market rewards efciency without government dealt with at the state and local levels. EPA’s eforts intervention. Supply, demand, competition, and the should focus on its core responsibilities under the powerful incentive for families and businesses to Resource Conservation and Recovery Act to clean get the biggest bang for their buck all work together up federal remediation sites. to drive down prices, get better performance, and provide greater efciency.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

176 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $2 DISCRETIONARY SAVINGS IN MILLIONS18

Eliminate the EPA’s Beach and Fish Programs

These programs provide information and guidance these programs duplicate work done by the Food on the human health risks of local ﬁsh consumption and Drug Administration and U.S. Department and swimming. These are essentially local issues for of Agriculture to inform consumers about sea- which states, local governments, and businesses are food products. better equipped to educate the public. In addition,

INT/ENV

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 177 The Heritage Foundation | heritage.org/BlueprintForBalance $29.3 DISCRETIONARY SAVINGS IN MILLIONS19

Reduce the EPA’s Surface Water Protection Program

Funding for the Surface Water Protection program Water Act is clear that states, not the federal gov- should be reduced to focus only on federal jurisdic- ernment, are supposed to play the leading role in tional waters. While the federal role in protecting water regulation. States should manage bodies of water is important, the Clean Water Act was never water like lakes, rivers, and streams that fall within envisioned as a tool for the federal government their boundaries. to regulate almost every body of water. The Clean

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

178 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $21.6 MANDATORY (ONE-TIME) SAVINGS IN BILLIONS20

Eliminate the Land and Water Conservation Fund

The LWCF, established by Congress in 1965 and part The federal government owns some 640 million of the U.S. Department of the Interior, allows the acres of land: nearly 30 percent of the country and federal government to use royalties from ofshore nearly half of the western United States. The LWCF energy development to buy private land and turn it is the primary vehicle for land purchases by the four into public parks and other public recreation areas. major federal land-management agencies. Congress Of the $40.0 billion credited to the fund, less than also uses the fund for a matching state grant pro- half ($18.4 billion) has been spent, leaving a credit of gram, although in practice the LWCF has chieﬂy $21.6 billion.21 Congress should rescind the remain- funded federal objectives. The federal government ing balance, generating a one-time savings of $21.6 cannot efectively manage the lands it already billion in FY 2020. owns, and Congress should not enable further land acquisition.

ADDITIONAL READING " Nicolas D. Loris and Katie Tubb, “Permanent Reauthorization of Land and Water Conservation Fund Opens Door to Permanent Land Grabs,” Heritage Foundation Issue Brief No. 4934, January 22, 2019. INT/ENV

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at FY 2019 levels.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 179 The Heritage Foundation | heritage.org/BlueprintForBalance $155 DISCRETIONARY SAVINGS IN MILLIONS22

Eliminate the National Endowment for the Humanities

The NEH, created on September 29, 1965, by Charitable donations to the arts, culture, and President Lyndon Johnson through the National humanities topped $19.5 billion in 2017, demon- Foundation on the Arts and the Humanities Act, strating that the humanities are ﬂourishing without received an appropriation of approximately $153 federal funding.25 Federal taxpayers should be free million for FY 2018.23 In its annual report for 2015, to contribute to the humanities in accordance with the agency reported that it had “awarded more than their own views and of their own volition. $5.6 billion for humanities projects through more than 64,000 grants” during the preceding 50 years.24 Funding for cultural productions and activi- These funds dwarf private giving. ties relating to the humanities as carried out by the NEH is outside the proper scope of the federal government. INT/ENV

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED

180 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $155 DISCRETIONARY SAVINGS IN MILLIONS26

Eliminate the National Endowment for the Arts

The NEA was created on September 29, 1965, by In addition, federally funded arts programs are President Lyndon Johnson through the National susceptible to cultural cronyism whereby special Foundation on the Arts and the Humanities Act. In interests promoting a social agenda receive govern- its annual report for 2015, the NEA reported that it ment favor to promote their causes.30 had awarded more than $5 billion for the arts during the preceding 50 years.27 Taxpayer assistance for the In the words of Citizens Against Government Waste, arts is neither necessary nor prudent. “[a]ctors, artists, and academics are no more deserv- ing of subsidies than their counterparts in other The NEA received an appropriation of approximate ﬁelds; the federal government should refrain from $155 million in FY 2019.28 However, private contri- funding all of them.”31 butions to the arts and humanities vastly exceed the amount provided by the NEA. Charitable donations Funding for art productions and activities as is to the arts, culture, and humanities topped $19.5 carried out by the NEA is outside the proper scope billion in 2017, demonstrating that the arts are of the federal government.

ﬂourishing without federal funding.29 Even that vast amount fails to account for ticket sales, private art purchases, and other ways in which Americans are consuming and supporting the arts. INT/ENV

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 181 The Heritage Foundation | heritage.org/BlueprintForBalance $12 DISCRETIONARY SAVINGS IN MILLIONS32

Eliminate Funding for the Woodrow Wilson International Center for Scholars The Wilson Center was created by the Woodrow The Wilson Center has a plan, readily available on Wilson Memorial Act of 1968 and serves both as the its website, specifying how it would continue to be ofcial memorial to President Woodrow Wilson funded without appropriations: “If there is a lapse and as a nonpartisan policy forum and independent in Federal funding as a result of failure to pass research institution. The Wilson Center regularly an appropriation bill, the Wilson Center will not publishes research about global policy and hosts close.”35 The Wilson Center can thus clearly operate events to facilitate “open dialogue” about “action- without federal funds. able ideas.”33 Funding the operations of a general think tank that In FY 2018, the Wilson Center received a $12 engages in independent research is outside the million appropriation from Congress.34 About proper scope of the federal government. one-third of the center’s budget comes from annual appropriations, with the remaining funds provided by private donations. There is a wide range of privately funded organizations that maintain programs that are very similar to the work of the Wilson Center. INT/ENV

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED

182 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $41.3 DISCRETIONARY SAVINGS IN MILLIONS36

Eliminate Funding for the John F. Kennedy Center for the Performing Arts The Kennedy Center opened in 1971 and serves as The Kennedy Center should be and can be fully the National Center for the Performing Arts and the funded by private donations and robust ticket sales. federal memorial to President John F. Kennedy.37 It does not need and should not receive tax dollars paid by Americans, many of whom may never In FY 2018, Congress appropriated $40.5 million for experience the music and theater for which they the operation, restoration, and maintenance of the are paying. Kennedy Center.38 Even assuming that the Kennedy Center is a national treasure, legislators should still It is not appropriate for the federal government ask whether using federal taxpayer money to sup- to be subsidizing a performing arts center, nor are port the arts, culture, and humanities is appropriate. these subsidies necessary, as the performing arts are thriving in the Washington, D.C., area—one of the Charitable donations to the arts, culture, and wealthiest regions of the country. humanities topped $19.5 billion in 2017, and even that large amount does not account for the personal Funding for the performing arts is outside the scope spending of individuals every year on entertain- of constitutional federal government obligations. ment provided by arts institutions like the Kennedy Center.39 INT/ENV

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at $40 million for FY 2020.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 183 INT/ENV Administration’s EPA wouldprohibitsuchactionsthrough issuedamemoexplainingthattheagency Administration proposed and implemented a series of climate change regulationsinaneforttoreduce proposedandimplementeda seriesofclimatechange Administration (pollution comingfrommultiplesourcesover awidearea,asopposedtopollutionfrompointsourcethat Advance the The agency isefectively seekingtoregulateagriculturalrunofandother nonpointsourcesofpollution The agency Tinkering around the edges willnotTinkering aroundtheedges fixthisunworkable policy. Moreover, thefederalgovernment shouldnot Endangered Species Act, NationalEnvironmental regulatoryprocessandaccountabilityreform, SpeciesAct, PolicyEndangered Act, Heritage Foundation’s 184 Congress shouldstill useitspower ofthepursetoensurethatretroactive vetoes donot occur. was exercised fouryearsaftertheCorpsissuedpermit. POLICY RIDERS lives inareasthathave not met thecurrentstandard, adopting aneven morestringentstandard isatbest million people (one-third of the U.S. population) lived in “nonattainment areas” that have not met the 75 ppb new regulatorychanges. revoke aSection404permitthattheArmy CorpsofEngineershasissued,regardlesswhether the is specificandidentifiable). recommendations forreformingenvironmental policy. Topics CleanWater includetheCleanAirAct, Act, indirectly, economicactivityandlanduse.Thishasrestricted opportunity, andcompliancecosts arepassed meet tighterstandards withsmaller marginsoftangiblebenefits. TheEPA isincreasinglysetting American mandate whichtypeoffueldrivers useinthefirst place.CongressshouldrepealtheRFS. economic the newstandard wellbeyondwhatCongressintendedintheCleanAirAct. goes to meet totheCongressionalResearchService,asofJune thecurrent75ppbstandard. According 2018, 107 the D.C. CircuitCourtofAppealsheldthattheEPA couldretroactively veto suchpermits;theEPA’s veto and toxicology. allowed. Rein intheEPA’s ozone standard. Prohibit retroactive vetoes 404permits. ofSection Prohibit federalefortstoregulate,eitherdirectlyorindirectly, nonpointsourcesofwater Prohibit the regulation of greenhouse gases and withdraw the endangerment finding. Prohibit theregulationofgreenhousegasesand withdraw theendangerment Repeal theRenewable Fuel Standard(RFS). greenhouse gasemissions from vehicles, heavy-duty trucks, airplanes, hydraulic fracturing,andnew on toAmericans, especiallythe poor. Far frombeingaquestion ofwhether ornot tohave clean,healthy air, ozone NationalAmbientAirQualityStandardsset by EPA in2008. of 70partsperbillion(ppb)inOctober2015. Thisdrastic actionwas premature.Statesarejust now starting owners sometimes havepermits. tosecuredredge-and-fill on householdsandbusinesses. Theywillproducenodiscernible climatebenefitwhilecausinghundreds energy, these restrictions ontheuseofabundant,afordableenergysourceswill onlyinflicteconomicpain existing power plants. Sinceconventional carbon-basedfuelsprovide morethan80percentofAmerica’s costs paidby Americanfamiliesbenefitaselectgroupofspecialinterests thatproducerenewable fuels. cost, theRFShas mademost Americansworseofby leadingtohigher foodandfuelexpenses. Thehigher The Heritage Foundation | Foundation Heritage The permit holderisinfullcompliancewithconditions. premature. pollution. 41 policy asitsets policy Thistypeofregulatoryschemecouldvery wellbeusedonanationallevel aswell. 48 The EPA’s efortstoaddresswater qualityintheChesapeake Bay areparticularlyproblematic. Theozone standard hasgrown morecontroversial asitbecomes increasinglyexpensive to Environmental Policy Guide 49 Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance Environmental Policy Guide 46 environmental Asofthiswriting,thesenewproposedregulationshadnot beenpublished,but 40 Thereiseven concernthattheEPA coulddetermine where farmingshouldbe The Environmental finalizedanewozone Protection standard Agency policy, enjoying nearlyunfettered power toset ozone standards and, A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A . Written incollaborationwithsixother organizations, The By requiringfuel blenderstousebiofuelsregardlessofthe includesover 100specificappropriationsandlegislative Under Section404oftheCleanWater property Act, 43 45 44 TheEPA hasdecidedthatitcanretroactively Fortunately, onJune 26, 2018, theTrump Ina2013 case, 47 Whenathirdofthenation’s population Mingo LoganCoal Co. v. EPA 50 42 The Obama , INT/ENV

185 )

2 X Even though the Trump though Even 51 Congress should prohibit all federal Congress should prohibit all federal 53 52 54 National monument designations have stripped economic stripped National monument designations have A FEDERAL BUDGET FOR FISCAL YEAR 2020 damage environment. on the Y heritage.org/BlueprintForBalance Blueprint for Balance: The EPA is using three statistical models, known as integrated assessment models, to estimate to estimate models, as integrated assessment known models, is using three statistical The EPA 55 over its lifetime and inflict and its lifetime over 2 When the EPA issues a rule to reduce emissions of a certain air pollutant, the direct benefits of When the EPA statement. statement. boosts the projected benefits of climate-related regulations in agency cost-benefit analyses. By placing By regulations in agency the projected benefits of climate-related analyses. boosts cost-benefit abuse). such a designation to the “smallest area compatible with proper care and management of the objects such a designation to the “smallest should prohibit all federal agencies from regulating greenhouse gas emissions. Congress also should order also should Congress agencies all federal should prohibit gas emissions. regulating greenhouse from should prohibit land acquisitions that result in a net gain in the size of the federal estate. Congress also in the size of the federal estate. gain result in a net should prohibit land acquisitions that and reauthorize the shrink the federal estate, Bureau of Land Management lands, should dispose of excess social cost of carbon. Subjecting the models to reasonable inputs for climate sensitivity and discount rates to reasonable inputs for climate of carbon. Subjecting the models social cost either by repealing the Antiquities Act altogether or by requiring congressional and state approval for any for any approval repealing the Antiquities Act state requiring congressional and either by altogether or by designation. designations have exceeded their statutory limitations. Congress should recognize what Wyoming Congress should recognize what Wyoming limitations. their statutory exceeded designations have opportunities from communities. Whether the issue is logging, recreation, conservation, or energy Whether opportunities from communities. more than For from Washington. not at the local level, these decisions should be made development, of thousands of jobs and trillions of dollars of gross domestic product to be lost. product to domestic of dollars of gross jobs and trillions of of thousands dramatically lowers the estimated figure for the social cost of carbon. Artificially increasing the estimates increasing the estimates of carbon. Artificially figure for the social cost the estimated dramatically lowers emitted today will cause over the next 300 years. However, these models arbitrarily derive a value for the a value these models arbitrarily derive However, 300 years. the next cause over will today emitted Prohibit the EPA from abusing cost-benefit analysis to justify costly air regulations (co-benefits costly to justify analysis cost-benefit from abusing Prohibit the EPA Repeal or reform the Antiquities Act.Repeal or reform the Antiquities Prohibit the use of the social cost of carbon in any cost-benefit analysis or environmental impact or environmental analysis cost-benefit any of carbon in of the social cost Prohibit the use Prohibit the net acquisition of land and shift federal land holdings to states and the private sector. and the private sector. of land and shift federal land holdings to states acquisition Prohibit the net away from the states and local organizations. Congress should eliminate the President’s authority to do so, authority to do so, Congress should eliminate the President’s and local organizations. from the states away a century, the President has had the power to designate land as a national monument unilaterally, land as a national monument unilaterally, to designate the power the President has had a century, agencies from using the social cost of carbon for any purpose, especially regulatory rulemaking. purpose, especially of carbon for any agencies using the social cost from a significantly high arbitrary price on a ton of carbon dioxide emitted into the atmosphere, the EPA can into the atmosphere, the EPA emitted a ton of carbon dioxide a significantly high arbitrary price on to quantify whether there are benefits associated with their regulatory objectives, instead relying solely or instead there are benefits associated with their regulatory objectives, to quantify whether to no benefits, the EPA points to the “co-benefits” of reducing particulate matter as justification for the rule. as justification the “co-benefits” of reducing particulate matter points to the EPA to no benefits, to declare national monuments unilaterally and arbitrarily and take economic and environmental decisions environmental economic and to declare national monuments unilaterally and arbitrarily and take to be protected,” Presidents from both parties have ignored that language. For far too long, monument ignored that language. For parties have Presidents from both to be protected,” the value of the social cost of carbon, defined as the economic damage that one ton of carbon dioxide (CO as the economic damage of carbon, defined dioxide that one ton of carbon cost the value of the social the Environmental Protection Agency Protection its endangerment to withdraw emissions, on greenhouse gas finding the Environmental warming. catastrophic toward that the Earth is heading the United Kingdom, Austria, Switzerland, the Netherlands, and Belgium combined—almost a third of a third of and Belgium combined—almost Switzerland, the Netherlands, the United Kingdom, Austria, parks. Only a fraction of this land is composed of national including Alaska and Hawaii. land mass, the U.S. tons of CO reducing those emissions should exceed the costs. However, for years, the EPA has found an improper end the EPA for years, However, the costs. reducing those emissions should exceed and few costs has massive objective stated rule’s when the run around this commonsense requirement. Even recognized in 1943 and what the 81st Congress recognized in 1950: The President should not have the ability have Congress recognized in 1950: The President should not recognized in 1943 and what the 81st ecting the climate but that no credible evidence suggests but that no credible evidence suggests gas emissions are afecting the climate recognizing that greenhouse inflate the benefits of regulation or inflate the costs of a new project, claiming that the project will emit of a new inflate the costs inflate the benefits of regulation or ected states. Although the law states that the President must limit that the President must states Although the law ected states. without input from Congress or af The Heritage Foundation | Department of the Interior’s maintenance backlog. maintenance Department of the Interior’s Federal Lands Transaction Facilitation Act, that funds generated will address the stipulating from land sales Facilitation Lands Transaction Federal Federal agencies cannot adequately manage agencies Congress these lands and the natural resources on them. cannot Federal This co-benefits abuse has become so egregious that the EPA has issued major rules without even bothering bothering has issued major rules without even This co-benefits abuse has become so egregious that the EPA The federal government’s land holdings are greater than the areas of France, Spain, Germany, Poland, Italy, Italy, Poland, Spain, Germany, of France, land holdings are greater than the areas The federal government’s Administration has taken positive steps to reverse the previous Administration’s climate agenda, Congress previous Administration’s the reverse to steps positive Administration has taken INT/ENV 186 The Heritage Foundation | Foundation Heritage The matter areaddressedthroughtheirown specificstatutory schemeandshouldnot beaddressedthrough other meanssuchasunrelatedairregulationsdeveloped underother sectionsoftheCAA. primarily onparticulatematter co-benefits. Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A 56 Under the Clean Air Act, criteriapollutantssuchasparticulate UndertheCleanAirAct, 57 INT/ENV

187 , , , , , , United United United United United United United United United United United United Report for Members and Committees of of Members and Committees for Report , June 22, 2018, http://www.multilateralfund.org/81/English/1/8158.pdf http://www.multilateralfund.org/81/English/1/8158.pdf , June 22, 2018, A FEDERAL BUDGET FOR FISCAL YEAR 2020 heritage.org/BlueprintForBalance Blueprint for Balance: , p. 376. Heritage experts assume that spending for FY 2019 remains constant in FY 2020. constant remains FY 2019 spending for that assume Heritage experts 376. , p. , p. 338. Heritage experts assume that spending for FY 2019 remains constant in FY 2020. constant remains FY 2019 spending for that assume 338. Heritage experts , p. in FY 2020. constant remains FY 2019 spending for that assume experts Heritage 365. , p. , p. 257. Heritage experts assume that spending for FY 2019 remains constant in FY 2020. constant remains FY 2019 spending for that assume experts Heritage 257. , p. in FY 2020. constant remains FY 2019 spending for that assume Heritage experts 272. , p. , p. 230. Heritage experts assume that spending for FY 2019 remains constant in FY 2020. constant remains FY 2019 spending for that assume Heritage experts 230. , p. in FY 2020. constant remains FY 2019 spending for that assume Heritage experts 242. , p. in FY 2020. constant remains FY 2019 spending for that assume Heritage experts 227. , p. , pp. 192 and 423. Heritage experts assume that spending for FY 2019 remains constant in FY 2020. in constant remains FY 2019 spending for that assume Heritage experts and 423. 192 , pp. in FY 2020. constant remains FY 2019 spending for that assume Heritage experts and 259. 197–208 , pp. , p. 182. Heritage experts assume that spending for FY 2019 remains constant in FY 2020. constant remains FY 2019 for spending that assume 182. Heritage experts , p. , August 17, 2018, https://fas.org/sgp/crs/misc/RL33531.pdf (accessed March 26, 2019). 26, March (accessed https://fas.org/sgp/crs/misc/RL33531.pdf 2018, 17, , August United States Environmental Protection Agency Fiscal Year 2020 Justification of Appropriation Estimates for the Committee on the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States United United States Environmental Protection Agency Fiscal Year 2020 Justification of Appropriation Estimates for the Committee on the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States United on the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States United United States Environmental Protection Agency Fiscal Year 2020 Justification of Appropriation Estimates for the Committee on the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States United on the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States United United States Environmental Protection Agency Fiscal Year 2020 Justification of Appropriation Estimates for the Committee on the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States United on the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States United on the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States United United States Environmental Protection Agency Fiscal Year 2020 Justification of Appropriation Estimates for the Committee on the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States United on the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States United United States Environmental Protection Agency Fiscal Year 2020 Justification of Appropriation Estimates for the Committee on the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States United March 2019, pp. 57 and 159, https://www.epa.gov/sites/production/files/2019-03/documents/fy-2020-congressional-justification-all-tabs.pdf https://www.epa.gov/sites/production/files/2019-03/documents/fy-2020-congressional-justification-all-tabs.pdf 159, and 57 pp. 2019, March p. 176. Heritage experts assume that spending for FY 2019 remains constant in FY 2020. constant remains FY 2019 spending for that assume Heritage experts 176. p. p. 1010. Heritage experts assume that spending for FY 2019 remains constant in FY 2020. constant remains FY 2019 spending for that assume Heritage experts 1010. p. in FY 2020. constant remains FY 2019 spending for that assume Heritage experts 126. p. pp. 66, 71, 220, and 225. Heritage experts assume that spending for FY 2019 remains constant in FY 2020. constant remains FY 2019 for spending that assume Heritage experts and 225. 66, 71, 220, pp. in FY 2020. constant remains FY 2019 spending for that assume Heritage experts 60. p. and Water Conservation Fund: Overview, History, and Issues,” Congressional Research Service Service Research Congressional and Issues,” History, Overview, Fund: Conservation and Water Report of the Eighty-First Meeting of the Executive Committee the Executive of Meeting the Eighty-First of Report (accessed March 26, 2019). 26, March (accessed (accessed March 26, 2019). Heritage experts assume that spending for FY 2019 remains constant in FY 2020. constant remains FY 2019 for spending that assume Heritage experts 2019). 26, March (accessed Savings of $17.0 million for FY 2020 are based on the FY 2019 appropriations reported in U.S. Environmental Protection Agency, Agency, Protection Environmental in U.S. reported appropriations based on the FY 2019 are FY 2020 million for of $17.0 Savings Savings of $21.6 billion for FY 2020 equals the last reported remaining LWCF balance of $21.6 billion as found in Carol Hardy Vincent, “Land Vincent, Hardy in Carol of $21.6 billion as found balance LWCF remaining reported equals the last FY 2020 of $21.6 billion for Savings Savings of $7.54 million for FY 2020 are based on the FY 2019 annualized spending level as found in U.S. Environmental Protection Protection Environmental in U.S. as found spending level annualized based on the FY 2019 are FY 2020 million for of $7.54 Savings Savings of $89.5 million for FY 2020 are based on the FY 2019 appropriations reported in U.S. Environmental Protection Agency, Agency, Protection Environmental in U.S. reported appropriations based on the FY 2019 are FY 2020 million for of $89.5 Savings Savings of $9.5 million for FY 2020 are based on the FY 2019 annualized spending level as found in U.S. Environmental Protection Protection Environmental U.S. in as found spending level annualized based on the FY 2019 are FY 2020 million for of $9.5 Savings Protection Environmental in U.S. as found spending level annualized based on the FY 2019 are FY 2020 million for of $2.0 Savings Protection Environmental in U.S. as found spending level annualized based on the FY 2019 are FY 2020 million for of $29.3 Savings Savings of $5.5 million for FY 2020 are based on the FY 2019 annualized spending level as found in U.S. Environmental Protection Protection Environmental in U.S. as found spending level annualized based on the FY 2019 are FY 2020 for million of $5.5 Savings 237. Ibid., p. Savings of $1.6 million for FY 2020 are based on the FY 2019 annualized spending level as found in U.S. Environmental Protection Protection Environmental in U.S. as found spending level annualized based on the FY 2019 are FY 2020 million for of $1.6 Savings Protection Environmental in U.S. as found spending level annualized based on the FY 2019 are FY 2020 of $6.5 million for Savings Savings of $413.59 million for FY 2020 are based on the FY 2019 annualized spending level as found in U.S. Environmental Protection Protection Environmental in U.S. as found spending level annualized based on the FY 2019 are FY 2020 million for of $413.59 Savings Savings of $0.3 million for FY 2020 are based on the FY 2019 annualized spending level as found in U.S. Environmental Protection Protection Environmental U.S. in as found spending level annualized based on the FY 2019 are FY 2020 million for of $0.3 Savings Savings of $8.7 million for FY 2020 are based on the FY 2019 annualized spending level as found in U.S. Environmental Protection Protection Environmental in U.S. as found spending level annualized based on the FY 2019 are FY 2020 million for of $8.7 Savings United Nations Environment Programme, Executive Committee of the Multilateral Fund for the Implementation of the Montreal Protocol, Protocol, of the Montreal the Implementation for Fund of the Multilateral Committee Executive Programme, Environment Nations United Savings of $17.1 million for FY 2020 are based on the FY 2019 appropriations reported in U.S. Environmental Protection Agency, Agency, Protection Environmental in U.S. reported appropriations based on the FY 2019 are FY 2020 million for of $17.1 Savings Savings of $8.74 million for FY 2020 are based on the FY 2019 appropriations reported in U.S. Environmental Protection Agency, Agency, Protection Environmental in U.S. reported appropriations based on the FY 2019 are FY 2020 million for of $8.74 Savings Savings of $12.8 million for FY 2020 are based on the FY 2019 annualized spending level as found in U.S. Environmental Protection Protection Environmental in U.S. as found spending level annualized based on the FY 2019 are FY 2020 million for of $12.8 Savings Savings of $17.6 million for FY 2020 are based on the FY 2019 appropriations reported in U.S. Environmental Protection Agency, Agency, Protection Environmental in U.S. reported appropriations based on the FY 2019 are FY 2020 million for of $17.6 Savings Savings of $94.2 million for FY 2020 are based on the FY 2019 appropriations reported in U.S. Environmental Protection Agency, Agency, Protection Environmental in U.S. reported appropriations based on the FY 2019 are FY 2020 million for of $94.2 Savings States Environmental Protection Agency Fiscal Year 2020 Justification of Appropriation Estimates for the Committee on Appropriations the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States on Appropriations the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States on Appropriations the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States States Environmental Protection Agency Fiscal Year 2020 Justification of Appropriation Estimates for the Committee on Appropriations the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States on Appropriations the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States States Environmental Protection Agency Fiscal Year 2020 Justification of Appropriation Estimates for the Committee on Appropriations the Committee for Estimates Appropriation of Justification 2020 Year Fiscal Agency Protection Environmental States Congress Agency, Agency, Agency, Agency, Agency, Agency, Agency, Agency, Agency, Agency, Agency, Agency, Agency, Agency, Agency, Agency, Agency, Appropriations Appropriations Appropriations Appropriations Appropriations Appropriations Appropriations Appropriations Appropriations Appropriations Appropriations

8. 5. The Heritage Foundation | 6. 9. ENDNOTES 19. 18. 17. 15. 16. 14. 12. 13. 11. 10. 1. 20. 2. 3. 7. 4. INT/ENV 44. 43. 42. 41. 40. 39. 38. 37. 36. 35. 34. 33. 32. 31. 30. 29. 28. 27. 26. 25. 24. 23. 22. 21. 188 | Foundation Heritage The

Agencies: Overview ofFY2019 Appropriations,” p. 16. Act, 2019. Heritageexperts assume that FY2019 spendingremains constant inFY2020. Savings include$24.49 millioninoperations and Agencies: Overview ofFY2019 Appropriations,” p. 16. Appropriations Act, 2019, Public Law 116-6, 116th Cong., February 15, 2019, https://www.congress.gov/116/bills/hjres31/BILLS-116hjres31enr.pdf Savings of$41.3 millionfor FY2020 are basedontheFY2019 appropriated level asspecifiedinH.J.Res. 31,Consolidated Appropriations Woodrow Wilson International Center for Scholars, “About theWilson Center,” https://www.wilsoncenter.org/about-the-wilson-center Citizens Against Government Waste, Charity Navigator, “Giving Statistics.” Table 1, “Interior, Environment, andRelated Agencies: FY2018–FY2019 Appropriations,” inVincent, “Interior, Environment, andRelated Table 1, “Interior, Environment, andRelated Agencies: FY2018–FY2019 Appropriations,” inVincent, “Interior, Environment, andRelated Savings of$12 million for FY2020 are basedontheFY2019 appropriated level asspecifiedinH.J.Res. 31,Consolidated Appropriations Act, Elizabeth Harrington, “The National Endowment for theArtsFunds Political Propaganda,” John F. Kennedy Center for thePerforming Arts,“Kennedy Center Planfor Federal Government Shutdown,” revised September 26, 2013, Woodrow Wilson International Center for Scholars, “Planfor Federal Funding Hiatus,” revised August 2015, p. 3, “Discharge of dredged material” refers to material excavated or dredged from waters of the U.S., and “discharge of fill material” See, for example, H.Sterling Burnett, “Farm Bureau Fights Federal LandGrab inChesapeake Bay Region,” HeartlandInstitute, U.S. Environmental Protection Agency, “Polluted Runof:Nonpoint Source (NPS) Pollution: Information Basic AboutNonpoint Source (NPS) To learnmore aboutthisfederal overreach, seeDaren Bakst, “Eliminating andReducing Robert Gordon andDianeKatz, eds., Savings of$155 millionfor FY2020 are basedontheFY2019 appropriated level asspecifiedinH.J.Res. 31,Consolidated Appropriations Act, Charity Navigator, “Giving Statistics,” https://www.neh.gov/sites/default/files/inline-files/neh_2015_annual_report_final.pdf (accessed H.R. 244, Consolidated Appropriations Act, 2017, Law Public 115-31, 115thCong., May 5, 2017, Estimated savings of$155 millionfor FY2020 are basedontheFY2019 appropriated level asspecifiedinH.J.Res. 31,Consolidated Ibid. Charity Navigator, “Giving Statistics.” Table 1,“Interior, Environment, andRelated Agencies: FY2018–FY2019 Appropriations,” inCarol Hardy Vincent, “Interior, Environment, National Endowment for theArts, National Endowment for theHumanities, (accessed March 26, Baise, 2019), andGary “Counties Attack EPA’s TMDLRegulations,” (accessed March 26, 2019). Emphasisinoriginal. (accessed March 27, 2019). (accessed March 26, 2019). (accessed March 26, 2019). (accessed March 26, 2019). Heritageexperts assume that FY2019 spendingremains constant inFY2020. 2019. Heritageexperts assume that FY2019 spendingremains constant inFY2020. 2019. Heritageexperts assume that FY2019 spendingremains constant inFY2020. changes.” U.S. Environmental Protection Agency, Ofce of Enforcement and Compliance Assurance, Ofce of Compliance, Managing Your Environmental Responsibilities: APlanningGuidefor Construction andDevelopment Congressional Research Service Service Research Congressional as “fill material” are amatter ofcontroversy. SeeClaudiaCopeland, “Controversies over Redefining ‘FillMaterial’ UndertheCleanWater Act,” and Related Agencies: Overview ofFY2019 Appropriations,” Congressional Research Service, updated January30, 2019, p. 16, more specific definitions of dredged material, fill material, and discharge of dredged or fill material. The precise definitions of terms such refers to “material placed in waters such that dry land replaces water—or a portion thereof—or the water’s bottom elevation modified June17, 2013, https://water.usgs.gov/water-basics_glossary.html (accessed March 26, 2019). maintenance and$16.800 millionincapitalrepair and restoration. the EPA regulations at 33 U.S. Code §323.2, http://www.law.cornell.edu/cfr/text/33/323.2 (accessed March 26, 2019). The regulations provide Foundation, 2015, p. 8,http://www.heritage.org/research/reports/2015/03/environmental-policy-guide. Regulatory Obstacles inAgriculture,” HeritageFoundation February 11,2016, https://www.heartland.org/news-opinion/news/farm-bureau-fights-federal-land-grab-in-chesapeake-bay-region March 26, 2019); U.S. Department oftheInterior, U.S. GeologicalSurvey, “Water Resources oftheUnited States: Water Glossary,” Basics last Pollution” last updated August 10, 2018, http://www.epa.gov/polluted-runof-nonpoint-source-pollution/what-nonpoint-source (accessed March 26, 2019). https://archive.epa.gov/compliance/resources/publications/assistance/sectors/web/pdf/myerguide.pdf (accessed March 26, 2019). See also https://www.heritage.org/government-regulation/report/eliminating-and-reducing-regulatory-obstacles-agriculture. http://www.jefersonpolicyjournal.com/counties-attack-epas-tmdl-regulations/ (accessed March 26, 2019). http://www.kennedy-center.org/legal/130927_fed_govt_shutdown.pdf (accessed March 26, 2019). https://www.wilsoncenter.org/sites/default/files/wilson_center_plan_for_possible_lapse_in_federal_appropriation_revised_august_2015.pdf http://thefederalist.com/2016/02/23/the-national-endowment-of-the-arts-funds-political-propaganda/ (accessed March 26, 2019). https://fas.org/sgp/crs/misc/R44934.pdf (accessed March 26, 2019). https://www.neh.gov/sites/default/files/inline-files/neh_2015_annual_report_final.pdf (accessed March 26, 2019). https://www.congress.gov/bill/115th-congress/house-bill/244 (accessed March 26, 2019). Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance Report for Congressfor Report 2015 AnnualReport Environmental Policy Guide:167 Recommendations for Environmental Policy Reform Prime Cuts Summary Annual Report 2015 A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A , August 21,2013, http://fas.org/sgp/crs/misc/RL31411.pdf (accessed March 26, 2019). , p. 2,https://www.arts.gov/sites/default/files/2015%20Annual%20Report.pdf , April2015, p. 34, http://cagw.org/sites/default/files/PrimeCuts2015.pdf Backgrounder , p. 2, No. 3135, June28,2016, Jeferson Policy Journal The Federalist , April 2005, p. 25, , February 23,2016, , March 2,2016, , The Heritage INT/ENV

189

Report for for Report Issue Brief Issue , August 28, 2017, 28, 2017, , August . Cato Institute in Support of Petitioners, in Support of Petitioners, Institute Cato Commentary Amicus Curiae , Brief of No. 3119, April 16, 2016, April 16, 2016, 3119, No. , Vol. 16, Issue 2 (July 2015), pp. 31–33, 31–33, pp. 2015), 2 (July 16, Issue , Vol. Engage Backgrounder A FEDERAL BUDGET FOR FISCAL YEAR 2020 , August 16, 2018, https://fas.org/sgp/crs/misc/R43092.pdf (accessed March 26, 2019). 26, March (accessed https://fas.org/sgp/crs/misc/R43092.pdf 16, 2018, , August , 714 F.3d 608 (D.C. Cir. 2013), https://scholar.google.com/scholar_ 2013), Cir. 608 (D.C. , 714 F.3d heritage.org/BlueprintForBalance Blueprint for Balance: Environmental Policy Guide: 167 Recommendations for Environmental Policy Reform Policy Environmental for Recommendations Guide: 167 Policy Environmental An Evaluation of the PM2.5 Health Benefits Estimates in Regulatory Impact Analyses for Recent Air Recent for Analyses Impact in Regulatory PM2.5 the of Estimates Health Benefits An Evaluation , Final Report Prepared for the Utility Air Regulatory Group, NERA Economic Consulting, December 2011, 2011, December Consulting, Economic NERA Group, Air Regulatory the Utility for Prepared , Final Report Murray Energy v. United Sates Environmental Protection Agency Protection Environmental Sates United v. Energy Murray http://www.nera.com/content/dam/nera/publications/archive2/PUB_RIA_Critique_Final_Report_1211.pdf (accessed (accessed http://www.nera.com/content/dam/nera/publications/archive2/PUB_RIA_Critique_Final_Report_1211.pdf 2019). 26, March (accessed http://www.globalwarming.org/2016/06/15/epas-pm2-5-co-benefits-pr-trick-exposed-2/ 26, March (accessed https://fedsoc-cms-public.s3.amazonaws.com/update/pdf/9JP5LCu5cyJfBZG6qz0BvUfwJu7lLZO3bbePOiNh.pdf https://docs.house.gov/meetings/SY/SY18/20170228/105632/HHRG-115-SY18-Wstate-DayaratnaK-20170228.pdf. http://docs.house.gov/meetings/II/II15/20171207/106700/HHRG-115-II15-Wstate-LorisN-20171207.pdf. https://www.heritage.org/environment/commentary/why-trumps-upcoming-decision-federal-lands-matters. https://www.heritage.org/environment/report/the-state-climate-science-no-justification-extreme-policies. http://www.scribd.com/doc/255666438/Bakst-Testimony-Ozone-Standards (accessed March 26, 2019). 26, March (accessed http://www.scribd.com/doc/255666438/Bakst-Testimony-Ozone-Standards https://www.epa.gov/cwa-404/memo-updating-epas-regulations-implementing-clean-water-act-section-404c (accessed March 26, 2019). 26, March (accessed https://www.epa.gov/cwa-404/memo-updating-epas-regulations-implementing-clean-water-act-section-404c November 25, 2016, https://www.scribd.com/document/332581815/Murray-Energy-Corp-v-EPA (accessed March 26, 2019). Other CAA Other CAA 2019). 26, March (accessed https://www.scribd.com/document/332581815/Murray-Energy-Corp-v-EPA 2016, 25, November March 26, 2019). See also Marlo Lewis, “EPA’s PM2.5 Co-Benefits PR Trick Exposed,” GlobalWarming.org, June 15, 2016, 2016, June 15, GlobalWarming.org, Exposed,” PR Trick PM2.5 Co-Benefits “EPA’s See also Marlo Lewis, 2019). 26, March March 17, 2016, https://www.heritage.org/testimony/examining-the-renewable-fuel-standard. 2016, 17, March http://thf_media.s3.amazonaws.com/2015/pdf/IB4454.pdf. 2015, 14, August 4454, No. Heritage Foundation Policies,” Extreme for No Justification Healthcare, Benefits, and Administrative Rules, Committee on Oversight and Government Reform, U.S. House of Representatives, House of Representatives, U.S. Reform, and Government on Oversight Rules, Committee Benefits, and Administrative Healthcare, Implementing Clean Water Act Section 404(c).” Environmental Protection Agency, last updated February 13, 2019, 13, 2019, February updated last Agency, Protection Environmental 404(c).” Section Act Water Clean Implementing Regulations Members and Committees of Congress of Members and Committees statutory sections arguably preclude consideration of criteria pollutants. of criteria consideration preclude arguably sections statutory on Environment and Oversight, Committee on Science and Technology, U.S. House of Representatives, February 24, 2017, 2017, 24, February House of Representatives, U.S. and Technology, on Science Committee Oversight, and on Environment 2017, 7, December House of Representatives, U.S. Resources, on Natural Committee and Investigations, on Oversight case?case=16285162805472090807&q=mingo+logan+coal+v.+epa+714+f.3d+608&hl=en&as_sdt=40000006&as_vis=1 (accessed March 26, 26, March (accessed case?case=16285162805472090807&q=mingo+logan+coal+v.+epa+714+f.3d+608&hl=en&as_sdt=40000006&as_vis=1 2019), and 2019), 2019). James E. McCarthy and Kate C. Shouse, “Implementing EPA’s 2015 Ozone Air Quality Standards,” Congressional Research Service Service Research Congressional Standards,” Air Quality Ozone 2015 EPA’s “Implementing C. Shouse, and Kate James E. McCarthy Daren Bakst, “Statement Regarding Proposed Ozone Standards,” testimony before the Environmental Protection Agency, January 29, 2015, 2015, January 29, Agency, Protection the Environmental before testimony Standards,” Ozone Proposed Regarding “Statement Bakst, Daren eds., and Katz, Gordon U.S. Environmental Protection Agency, “Section 404 of the Clean Water Act: Memo: Updating the EPA’s Regulations Regulations the EPA’s Updating Memo: Act: 404 of the Clean Water “Section Agency, Protection Environmental U.S. Mingo Logan Coal Co. v. EPA v. Co. Coal Mingo Logan See, for example, C. Boyden Gray, “EPA’s Use of Co-Benefits,” Use of Co-Benefits,” “EPA’s Gray, C. Boyden example, for See, Nicolas Loris, “Transforming the Department of the Interior for the 21st Century,” testimony before the Subcommittee the Subcommittee before testimony Century,” the 21st for of the Interior the Department “Transforming Loris, Nicolas Heritage Foundation Matters,” Lands Decision on Federal Upcoming Trump’s “Why Tubb, Katie Nicolas D. Loris, “Four Big Problems with the Obama Administration’s Climate Change Regulations,” Heritage Foundation Heritage Foundation Change Regulations,” Climate with the Obama Administration’s Big Problems “Four Loris, D. Nicolas Science: of Climate State “The Dayaratna, and Kevin Tubb, Katie Loris, D. Nicolas Kreutzer, David the Subcommittee before testimony of Carbon,” Social Cost the Establish Used to and Parameters “Methods Dayaratna, D. Kevin Nicolas Loris, “Examining the Renewable Fuel Standard,” testimony before the Subcommittee on the Interior and Subcommittee on and Subcommittee on the Interior the Subcommittee before testimony Standard,” Fuel the Renewable “Examining Loris, Nicolas Anne E. Smith,

57. 55. 56. 54. 53. 52. 50. 51. The Heritage Foundation | 48. 49. 47. 45. 46.

Labor, Health and Human Services, Education, and Related Agencies The Heritage Foundation | heritage.org/BlueprintForBalance $1.7 DISCRETIONARY SAVINGS IN BILLIONS1

Eliminate the Job Corps

The Job Corps is an inefective federal job-training " Four years after participating in the evaluation, program that should be eliminated. The National the average weekly earnings of participants were Job Corps Study, a randomized experiment that only $22 higher than the average weekly earnings assessed the Job Corps’ impact on participants of the control group; and compared to similar non-participants, found that for a federal taxpayer investment of $25,000 per Job " Employed Job Corps participants earned only Corps participant: $0.22 more in hourly wages than employed members of the control group earned. " Compared to non-participants, participants were less likely to earn a high school diploma (7.5 If the Job Corps truly improved the skills of its par- percent versus 5.3 percent); ticipants, it should have raised their hourly wages substantially. A $0.22 increase in hourly wages sug- " Compared to non-participants, participants were gests that it actually does little to boost the job skills no more likely to attend or complete college; of participants. A cost-beneﬁt analysis based on the National Job Corps Study found that the beneﬁts of the Job Corps do not outweigh its costs.2

ADDITIONAL READING " David B. Muhlhausen, “Do Federal Social Programs Work?” Heritage Foundation Backgrounder No. 2884, March 19, 2014. " David B. Muhlhausen, “Job Corps: An Unfailing Record of Failure,” Heritage Foundation WebMemo No. 2423, May 5, 2009.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

Cuts funding and closes underperforming centers, along PARTIALLY President’s Budget (FY2020) with focusing on older youth, but does not eliminate the INCLUDED program.

192 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $3.2 DISCRETIONARY SAVINGS IN BILLIONS3

Eliminate Workforce Innovation and Opportunity Act Job-Training Programs Workforce Innovation and Opportunity Act and receive one-on-one assistance and other Job-Training Programs are inefective and should employment services, participation had no efect be eliminated. WIOA is very similar to its anteced- on earnings. ent program, the Workforce Investment Act of 1998 (WIA). As documented in a 2016 Mathematica Full-WIA participants did not believe that the Policy Research study, the most important test of services provided to them resulted in finding jobs. the WIA’s efectiveness is the comparison of “full A solid majority of 57 percent of full-WIA partici- WIA” services—intensive services (skills assess- pants believed that the services provided to them ments, workshops, and job-search assistance) plus were unrelated to finding employment. Perhaps job training—to core services, which ofered mostly more important, full-WIA participants were information and online tools for participants to largely unable to find employment in occupations plot their careers and find employment. During the related to their training. Only 32 percent of full- five quarters of the follow-up period, the earnings WIA participants found occupations in the areas of of members of the full-WIA group were not statis- their training. tically diferent from those of the core group. In the fifth quarter, the earnings of the full-WIA group Given the vast similarities between WIOA and WIA, were indistinguishable on average from those of Mathematica’s findings are equally applicable in the core group. Even though members of the full- assessing the WIOA program. WIA group were more likely to enroll in training

ADDITIONAL READING LABOR/HHS " David B. Muhlhausen, “Do Federal Social Programs Work?” Heritage Foundation Backgrounder No. 2884, March 19, 2014. " Sheena McConnell, Kenneth Fortson, Dana Rotz, Peter Schochet, Paul Burkander, Linda Rosenberg, Annalisa Mastri, and Ronald D’Amico, Providing Public Workforce Services to Job Seekers: 15-Month Impact Findings on the WIA Adult and Dislocated Worker Programs, Mathematica Policy Research, May 2016.

PROPOSAL STATUS EXPLANATION

Cuts funding for three programs funded by WIOA: the PARTIALLY Indian and Native American Program, Migrant and President’s Budget (FY2020) INCLUDED Seasonal Farmworker Training, and the Senior Commu- nity Service Employment Program.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 193 The Heritage Foundation | heritage.org/BlueprintForBalance $741 DISCRETIONARY SAVINGS IN MILLIONS4

Let Trade Adjustment Assistance Expire

TAA provides overly generous government bene- group of workers in the manufacturing sector and fits to American workers who lose their jobs when from the same local areas. Over the four years companies find overseas production less costly. The examined by the study, TAA participants earned a program encourages recipients to participate in job total of $35,133 less than their counterparts. Addi- training that fails to improve participants’ earning tionally, only 37 percent of TAA participants who potential. The program is inefective and should received job training found employment in the areas be eliminated. of their training. A cost-benefit analysis found that the TAA’s benefit to society was a negative $53,802 A 2012 Mathematica Policy Research study statisti- per participant. cally matched TAA participants with a comparison

ADDITIONAL READING " David B. Muhlhausen, James Sherk, and John Gray, “Trade Adjustment Assistance Enhancement Act: Budget Gimmicks and Expanding an Inefective and Wasteful ‘Job-Training’ Program,” Heritage Foundation Issue Brief No. 4396, April 28, 2015. " Peter Z. Schochet, Ronald D’Amico, Jillian Berk, Sarah Dolﬁn, and Nathan Wozny, Estimated Impacts for Participants in the Trade Adjustment Assistance (TAA) Program Under the 2002 Amendments, Social Policy Research Associates and Mathematica Policy Research, August 2012.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reforms the TAA but does not eliminate it. INCLUDED

194 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $10.5 DISCRETIONARY SAVINGS IN MILLIONS5

Eliminate Susan Harwood Training Grants

Since 1978, the Occupational Safety and Health people trained to assess the grant program’s perfor- Administration has provided Harwood grants to mance.6 The number of people trained provides no nonproﬁt organizations to provide safety training to information by which to determine whether train- workers. These training grants are inefective and ees learned anything new to make workplaces safer. should be eliminated. Measuring the number of people trained does not Despite existing for decades, there is no credible measure program “impact.” Instead, it measures an evidence that these training grants are efective. output. Program impact is assessed by comparing Moreover, the Department of Labor is measuring outcomes for program participants with estimates the wrong things to assess program impact. A case of what the outcomes would have been had they not in point is the FY 2015 Department of Labor per- participated in the program. formance report that relies solely on the number of

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 195 The Heritage Foundation | heritage.org/BlueprintForBalance $123.4 DISCRETIONARY SAVINGS IN MILLIONS7

Bring National Labor Relations Board Funding in Line with Caseloads

Under the National Labor Relations Act, the NLRB Consequently, the NLRB caseload has fallen con- regulates private-sector union elections and collec- siderably as well. The NLRB received 65 percent tive bargaining, except for unions in the railway and fewer election petitions and 40 percent fewer unfair airline industries regulated by other law. The NLRB labor practice charges in FY 2014 than in FY 1990; conducts union certification and decertification despite this reduced workload, however, the NLRB’s elections, investigates unfair labor practices, and inflation-adjusted budget has increased by one- adjudicates cases with administrative law judges. sixth since 1990. Reducing the NLRB’s budget by 45 percent in FY 2020 would bring its spending in line Private-sector union membership and organizing with the previous funding levels for its caseload and has dropped considerably over the past 25 years. save taxpayers $123 million in FY 2020.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED

196 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $103.5 DISCRETIONARY SAVINGS IN MILLIONS8

Eliminate the Office of Federal Contract Compliance Programs

The mission of the Ofce of Federal Contract Com- Vietnam Era Veterans’ Readjustment Assistance Act pliance Programs is to enforce equal employment of 1974 and Section 503 of the Rehabilitation Act of opportunity laws as applied to federal contractors. 1973, which, respectively, prevent discrimination By contrast, the Equal Employment Opportunity against veterans and those with disabilities. The Commission enforces equal employment oppor- EEOC enforces civil rights laws against workplace tunity laws as applied to all public and private discrimination by all employers, which includes dis- employers. A separate agency for federal contrac- crimination based on age, disability, discrepancy in tors is redundant. pay, genetic information, national origin, pregnancy, children, race or color, religion, or sex. The Veter- In 1965, President Lyndon Johnson signed Exec- ans’ Employment and Training Service enforces utive Order No. 11246, which prohibited federal equal employment opportunity laws that prevent contractors from discrimination based on race, discrimination against veterans. Such redundancy color, religion, sex, or national origin. The OFCCP renders the OFCCP unnecessary. enforces these provisions. It also enforces the

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 197 The Heritage Foundation | heritage.org/BlueprintForBalance $13.8 DISCRETIONARY SAVINGS IN MILLIONS9

Eliminate the Department of Labor’s Women’s Bureau

The Women’s Bureau examines challenges facing Both Title VII of the 1964 Civil Rights Act and the women in the workforce. It was created in 1920 Equal Pay Act of 1963 prohibit sex-based discrim- when few women worked outside the home. Today, ination in the workplace. The Equal Employment women make up half of the workforce and hold Opportunity Commission enforces those civil rights more than half of the nation’s management, profes- laws to ensure that women enjoy equal opportu- sional, and related occupations. The future of the nity in the workplace. The challenges facing female workforce looks just as bright for women, given that employees are the challenges facing workers as a they earned more than half of the bachelor’s degrees whole. The Women’s Bureau has served the pur- (57.2 percent); master’s degrees (59.2 percent); and pose for which it was created in 1920 and has now doctoral degrees (52.7 percent) in 2016. become obsolete.

ADDITIONAL READING " Rachel Greszler, “‘Pay Gap’ Myth Ignores Women’s Intentional Job Choices,” Heritage Foundation Commentary, April 9, 2018. " Rachel Greszler and James Sherk, “Equal Pay for Equal Work: Examining the Gender Gap,” Heritage Foundation Issue Brief No. 4227, May 22, 2014.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Cuts spending for the bureau but does not eliminate it. INCLUDED

198 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $59.8 DISCRETIONARY SAVINGS IN MILLIONS10

Eliminate the Bureau of International Labor Afairs

The International Labor Afairs Bureau (ILAB) Labor policies should have a minimal role in trade was established by President Harry Truman at the agreements, seeking only to protect such basic behest of U.S. trade unions. Its stated mission “is to rights as freedom from forced labor and freedom of promote a fair global playing ﬁeld for workers in the association. Trade agreements should not be used United States and around the world by enforcing to pursue liberal policy agendas that impose unnec- trade commitments, strengthening labor standards, essary regulations on the labor market. The bureau and combating international child labor, forced that oversees the enforcement of labor in trade labor, and human trafcking.”11 ILAB monitors the agreements should therefore be eliminated. implementation of labor provisions of free trade agreements and provides grants to unions and aid organizations to promote the welfare of foreign workers. These grants are of doubtful efectiveness and are a poor use of U.S. taxpayer dollars in times of tight budgets.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Cuts spending for the bureau but does not eliminate it. INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 199 The Heritage Foundation | heritage.org/BlueprintForBalance $268 DISCRETIONARY SAVINGS IN MILLIONS12

Federal Personnel Reform: Eliminate “Rest of U.S.” Locality Pay

The Federal Employees Pay Comparability Act of While most locality areas are centered on metropol- 1990 created a new system that allowed for pay itan areas, such as New York or Washington, D.C., an adjustments for federal employees who lived in additional locality called “Rest of U.S.” (RUS) exists high-cost areas. There are currently 53 General to cover all federal employees that do not fall into Schedule Locality Areas. Federal employees earn one of the other 52 localities. By deﬁnition, areas more than the base pay rate by having their salary that are in the RUS locality should not be more increased according to the locality adjustment-in- expensive to live in than the national average, yet crease percentage, which in 2019 is a maximum the RUS receives a 15.37 percent increase above increase of 39.28 percent for federal workers in the the base GS schedule, which means that instead of San Francisco, California, locality.13 For example, receiving base pay, RUS employees receive at least the base pay salary for a federal employee at GS 15 percent more than the base GS schedule. In some grade 8, step 4 in 2018 was $43,679. If that employee places, RUS federal employees receive more than 30 were to live in Chicago, Illinois, the adjusted salary percent higher pay than the local average. for that locality would be $55,678.

ADDITIONAL READING " Rachel Greszler and James Sherk, “Why It Is Time to Reform Compensation for Federal Employees,” Heritage Foundation Backgrounder No. 3139, July 27, 2016.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

200 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $376 DISCRETIONARY SAVINGS IN MILLIONS14

Federal Personnel Reform: Tie Pay Increases to Truly Market-Based and Performance-Based Measures The federal government’s pay structure, which and so-called performance-based step increases relies on a prescribed formula instead of per- whereby 99.9 percent of federal employees receive formance, results in an inﬂated pay system that raises. Congress should reduce the pay diferen- encourages mediocrity and fails to reward excel- tial between steps 1 and 10 of the GS scale from lence. Heritage Foundation experts have estimated 30 percent to 20 percent and tie step increases that the wages received by federal employees are 22 to true performance-based measures instead of percent higher than those of similar workers in the tenure alone. Part of the savings should go toward private sector.15 higher performance-based budgets to help attract and retain talented employees. Combined, these Federal employees’ higher pay comes in large changes should lead to a 5 percent reduction in part from receiving two essentially automatic federal pay levels. pay increases: annual cost-of-living-adjustments

ADDITIONAL READING " Rachel Greszler and James Sherk, “Why It Is Time to Reform Compensation for Federal Employees,” Heritage Foundation Backgrounder No. 3139, July 27, 2016. " Kay Coles James, “A Fresh Start for Federal Pay: The Case for Modernization,” U.S. Ofce of Personnel Management White Paper, April 2002. LABOR/HHS

PROPOSAL STATUS EXPLANATION

PARTIALLY Eliminates across-the-board pay raises in favor of President’s Budget (FY2020) INCLUDED performance-based pay increases.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 201 The Heritage Foundation | heritage.org/BlueprintForBalance $46.7 MIXED SAVINGS IN BILLIONS16

Federal Personnel Reform: Bring Retirement Benefits in Line with the Private Sector The overall compensation received by federal Congress should bring federal benefits in line with employees is significantly higher than that of their the private sector by shifting all new hires and those private-sector counterparts. The biggest source with fewer than five years of service to an exclu- of this compensation premium, which Heritage sively thrift savings retirement plan with higher Foundation experts estimate is between 30 per- employer contributions. Employees with between cent and 40 percent of total compensation, is five and 20 years of service should have the option to excessive retirement benefits. Federal employees switch to an exclusively thrift savings plan retire- receive up to 18.2 percent of their pay in retirement ment system, freeze their already-accrued Federal benefits: between 11.1 percent and 13.2 percent Employees Retirement System benefits and receive in a defined-benefit pension and up to 5 percent higher TSP contributions, or maintain their current in a 401(k). Among private-sector employees retirement benefits with FERS plan reforms such who receive retirement contributions from their as higher employee contributions. This would save employers, the average contribution is between 3 taxpayers $206 billion over the next 10 years, make percent and 5 percent. the government more competitive by reducing the share of compensation tied up in retirement benefits, and give workers both more control of their retirement and potentially larger paychecks.

ADDITIONAL READING " Rachel Greszler and James Sherk, “Why It Is Time to Reform Compensation for Federal Employees,” Heritage Foundation Backgrounder No. 3139, July 27, 2016. " Congressional Budget Ofce, Comparing the Compensation of Federal and Private-Sector Employees, 2011 to 2015, April 2017.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

Includes several changes to reduce the generosity of PARTIALLY federal employee retirement beneﬁts, primarily by President’s Budget (FY2020) INCLUDED reducing cost-of-living adjustments and increasing employee contributions to the retirement plan.

202 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $113 MANDATORY SAVINGS IN MILLIONS17

Federal Personnel Reform: Eliminate the Special Retirement Supplement Federal employees who have worked for at least federal employees receiving retirement benefits for 20 years and who retire at relatively young ages more years than they spent working. (between ages 57 and 62) receive a “special retirement supplement” that is meant to give them a This benefit is not something to which either the rough equivalent of Social Security benefits at a time federal government or its employees contribute; when they are not yet eligible to receive Social Secu- instead, the funds come from taxpayers. Eliminating rity.18 This extra benefit in addition to the FERS, the special retirement supplement would save an TSP, and regular Social Security benefits that federal estimated $113 million in FY 2020 and $5.3 billion retirees receive is both unnecessary and excessive. over 10 years. The special retirement supplement can result in

ADDITIONAL READING " Congressional Budget Ofce, Options for Reducing the Deﬁcit: 2017 to 2026, December 2016. LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 203 The Heritage Foundation | heritage.org/BlueprintForBalance $5.7 DISCRETIONARY SAVINGS IN BILLIONS19

Federal Personnel Reform: Bring Paid Leave in Line with the Private Sector Federal employees receive signiﬁcantly more days Congress should bring the amount of paid leave of paid leave than similar private-sector employ- provided to federal employees in line with pri- ees receive. A federal employee with ﬁve years of vate-sector paid leave by reducing vacation leave by experience receives 20 vacation days and 13 paid between three and six days and sick leave by three sick days for a total of 33 days (not including 10 paid days so that federal employees receive between 20 holidays). The average private-sector employee at and 30 days of paid leave. Alternatively, Congress a larger company receives 13 days of vacation and should consider shifting to a Paid Time Of system eight paid sick days for a total of 21 days of paid leave that provides between 16 and 27 days of PTO. (excluding holidays). PTO policies, which do not diferentiate between sick and vacation days, have become increasingly common in the private sector and are preferred by many employees.

ADDITIONAL READING " Rachel Greszler and James Sherk, “Why It Is Time to Reform Compensation for Federal Employees,” Heritage Foundation Backgrounder No. 3139, July 27, 2016.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

204 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $569 DISCRETIONARY SAVINGS IN MILLIONS20

Federal Personnel Reform: Eliminate FEHB Retirement Benefits for New Hires Federal employees receive significantly higher total Future health care benefits are of little value compensation than their private-sector counter- to newly hired federal employees because they parts receive, including the often overlooked and typically are not received until decades later. undervalued advantage of participating in the Additionally, instead of rewarding tenure, benefits Federal Employees Health Benefits Program after reward workers who are employed by the gov- retirement while paying only a small portion of the ernment in the final five years before they retire. total premium. Data published by the Congressional If workers leave federal employment before they Budget Ofce in 2002 indicate that the accrual cost reach retirement eligibility age, or if they have less of retiree health coverage equaled 6.34 percent of than five consecutive years of employment leading pay.21 Heritage Foundation experts estimated that up to retirement, they do not receive the benefits. eliminating this benefit for new hires would generate $32.5 billion in accrued taxpayer savings over Congress should eliminate FEHB retirement ben- the 2020–2029 period. Private-sector companies efits for new hires. This would generate significant almost never provide the same level of highly subsi- future cost savings with little impact on the federal dized health benefits in retirement. government’s ability to attract talented workers.

ADDITIONAL READING " Rachel Greszler and James Sherk, “Why It Is Time to Reform Compensation for Federal Employees,” Heritage Foundation Backgrounder No. 3139, July 27, 2016. " Congressional Budget Ofce, “The President’s Proposal to Accrue Retirement Costs for Federal Employees,” CBO Paper, June 2002. LABOR/HHS

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 205 The Heritage Foundation | heritage.org/BlueprintForBalance $0 DISCRETIONARY (NO SAVINGS)22

Federal Personnel Reform: Eliminate the 25 Percent FEHB Premium Requirement The premium structure for the Federal Employees advantageous to them—because 75 percent of the Health Beneﬁts system drives up total FEHB costs savings goes to the federal government and only 25 by discouraging federal workers from choosing percent accrues to them. lower-cost plans. Currently, the government contributes up to 72 percent of the weighted average Congress should convert the current maximum premiums of all health insurance plans in the contribution level to a ﬂat-rate contribution so that FEHB, but employees must pay at least 25 percent, workers who choose lower-cost plans can keep all of regardless of the cost of the plan they choose. This the savings. This would increase competition among reduces federal employees’ incentives to choose less FEHB plans and over time would reduce the average expensive health care plans—even if those plans are cost to taxpayers of FEHB coverage.

ADDITIONAL READING " Rachel Greszler and James Sherk, “Why It Is Time to Reform Compensation for Federal Employees,” Heritage Foundation Backgrounder No. 3139, July 27, 2016. " Congressional Budget Ofce, Options for Reducing the Deﬁcit: 2019 to 2028, December 2018.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

206 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $0 DISCRETIONARY (NO SAVINGS)23

Safeguard Private Pension Insurance and Protect Taxpayers from Private Pension Bailouts The Pension Benefit Guarantee Corporation’s mul- Congress should increase multiemployer PBGC tiemployer program faces a shortfall of between $54 premiums and add a variable-rate premium for billion and $101 billion because a significant portion newly incurred pension liabilities. Congress should of the roughly 1,400 multiemployer (private, union- also end its preferential treatment of multiemployer run) pension plans that operate across the U.S. are pension plans and instead subject multiemployer massively underfunded and have promised $638 bil- plans to the same rules that govern other private lion more than they have set aside to pay. The PBGC pension plans. Additionally, policymakers should provides insurance against private pension losses, consider implementing rules both to minimize pen- but its multiemployer program is on track to run out sion losses within plans and to safeguard pensioners of money by 2025. If that happens, pensioners will against inviable promises and irresponsible plan experience significant pension losses, and Congress management. These changes would help to guard could pass legislation requiring taxpayers to bail out against pension losses for workers and retirees who the PBGC or even to bail out private pension plans belong to multiemployer pension plans and protect directly. A private union pension bailout could cost taxpayers from the risk of a taxpayer bailout of the hundreds of billions of dollars. PBGC or multiemployer pension plans.

ADDITIONAL READING " Rachel Greszler, “Congress’s Multiemployer Pension Committee Should Act Now: 12 Reforms to Protect Pensioners and Taxpayers,” Heritage Foundation Backgrounder No. 3368, November 20, 2018. " Rachel Greszler, “Why Government Loans to Private Union Pensions Would Be Bailouts—and Could Cost Taxpayers More than Cash Bailouts,” Heritage Foundation Backgrounder No. 3283, February 5, 2018. LABOR/HHS " Rachel Greszler, “Bankrupt Pensions and Insolvent Pension Insurance: The Case of Multiemployer Pensions and the PBGC’s Multiemployer Program,” Heritage Foundation Backgrounder No. 3029, July 30, 2015.

PROPOSAL STATUS EXPLANATION

Improves funding of the Pension Beneﬁt Guaranty PARTIALLY President’s Budget (FY2020) Corporation's multiemployer program by requiring INCLUDED higher premiums for underfunded plans.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 207 The Heritage Foundation | heritage.org/BlueprintForBalance $2.9 MANDATORY SAVINGS IN BILLIONS24

Adopt a More Accurate Inflation Index for Social Security and Other Mandatory Programs Federal benefits like Social Security grow with The chained CPI would correct for the small sample the cost of living to protect the value of benefits bias and substitution bias problems that are known from inflation. Several other parameters of federal to afect the CPI. Adopting the chained CPI for fed- benefit programs are also adjusted for inflation. eral benefit calculations would protect benefits from Currently, Social Security and several other federal inflation while improving accuracy in cost-of-liv- programs are indexed to the consumer price index ing adjustments and saving taxpayers money. This to adjust for inflation. The current CPI is outdated proposal saves $2.9 billion in 2020, with savings and inaccurate, and it often overstates the rise in growing rapidly over time to $44 billion in FY 2029. the cost of living. Under a new measure, benefit increases would reflect changes in the cost of living more accurately.

ADDITIONAL READING " Romina Boccia and Rachel Greszler, “Social Security Beneﬁts and the Impact of the Chained CPI,” Heritage Foundation Backgrounder No. 2799, May 21, 2013. " Congressional Budget Ofce, Options for Reducing the Deﬁcit: 2017 to 2026, December 2016.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

208 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $742 MANDATORY SAVINGS IN MILLIONS25

Improve Unemployment Insurance Program Integrity

The Unemployment Insurance (UI) program is a In order to achieve this reduction, existing pro- federal–state partnership that is intended to replace grams need to be improved. For instance, the a portion of the lost earnings of unemployed per- Separation Information Data Exchange System sons. The Department of Labor estimates that $3.7 (SIDES), which allows states to exchange informa- billion in overpayments was made in 2017, including tion on the reasons for a claimant’s separation from $1 billion that is attributed to fraud.26 Curtailing the employment, should be expanded. Additionally, the amount that is wasted by fraud and overpayment Secretary of Labor should be empowered to develop could mean a reduction in state unemploy- sanctions and incentives that will encourage ment taxes. state performance.

ADDITIONAL READING " Salim Furth, “Cutting Unemployment Insurance Probably Does Create Jobs, But We Don’t Know How Many Yet,” National Review, The Corner, January 29, 2015. LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 209 The Heritage Foundation | heritage.org/BlueprintForBalance $531 MANDATORY SAVINGS IN MILLIONS27

Allow the SSA to Use Commercial Databases to Verify Real Property in the SSI Program Allowing the Social Security Administration to use reporting burden and allow the SSA to determine an commercial databases to verify real property (land individual’s eligibility for beneﬁts automatically. and buildings) in the Supplemental Security Income program would reduce improper payments. Real Enacting this proposal would still preserve all due property can be a countable resource for determin- process and appeal rights while reducing improper ing SSI eligibility, and authorizing the SSA to use SSA payments. private commercial databases to determine owner- ship of real property would both lessen recipients’

ADDITIONAL READING " Romina Boccia, “Here are 5 New Signs Social Security Is Going Insolvent,” Heritage Foundation Commentary, June 6, 2018.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

210 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $2.5 MANDATORY SAVINGS IN BILLIONS28

Increase the OASDI Overpayment Collection Threshold

When individuals improperly receive more than The minimum monthly withholding of $10 should they were supposed to receive from Social Security, be updated to 10 percent of benefits to reflect rising the program recoups those overpayments by with- benefit levels as well as the need to restore the pro- holding a small portion ($10) from the recipient’s gram’s financial shortfalls. This change would also future monthly benefit checks. However, because bring OASDI policy in line with the SSI program, the withholding is so low, many overpayments are which uses a 10 percent recovery rule. never fully recouped. The current $10 amount was established in 1960, at which point $10 equaled 12 percent of the average retiree’s benefit; today, $10 is less than 1 percent of the average retiree’s benefit.

ADDITIONAL READING

" Romina Boccia, “Report: Nearly Half of Social Security Disability Beneﬁciaries Were Overpaid by Government,” The Daily Signal, June 22, 2015. LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 211 The Heritage Foundation | heritage.org/BlueprintForBalance $20.3 MANDATORY SAVINGS IN BILLIONS29

Reduce Fraud and Marriage Penalties in the Earned Income Tax Credit and Additional Child Tax Credit The EITC and ACTC provide refundable tax credits These problems can be addressed by requiring to low-income households. They are designed to the IRS to verify income tax returns before issu- promote work but are plagued with fraud. Other ing refundable tax credits, allowing only parents problems with the EITC and ACTC include benefits with legal custody of a child to claim benefits, not intended for parents going to non-parents, some allowing families who receive subsidized housing EITC and ACTC recipients receiving excessive assistance to receive EITC and ACTC benefits as multi-tier means-tested welfare benefits that are well, and ending marriage penalties. In addition, not available to other similar low-income recipients, the EITC could be expanded for married couples to and discrimination against married couples. help decrease marriage penalties that exist across the rest of the government means-tested welfare system.

ADDITIONAL READING " Robert Rector and Jamie Bryan Hall, “Reforming the Earned Income Tax Credit and Additional Child Tax Credit to End Waste, Fraud, and Abuse and Strengthen Marriage,” Heritage Foundation Backgrounder No. 3162, November 16, 2016.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

Requires valid-for-work Social Security number to claim PARTIALLY the EITC or child tax credit. Requirement "extends to all President’s Budget (FY2020) INCLUDED ﬁlers and all qualifying children or dependents claimed on the tax return."

212 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $2.4 DISCRETIONARY SAVINGS IN BILLIONS30

Return Control of and Fiscal Responsibility for Low-Income Housing to the States The federal government currently pays over 90 per- the needs of their unique populations. The fiscal cent of the cost of subsidized housing for poor and responsibility of paying for their housing programs low-income persons. In FY 2017, the cost was more would give them the incentive to run these pro- than $40 billion. Housing needs, availability, and grams much more efciently and efectively. costs vary significantly across states and localities, as does the level of needed and available assistance. Federal funding for means-tested housing programs Instead of merely perpetuating federally funded should be phased out at a rate of 10 percent per year, programs that often provide substantial benefits for reaching zero funding at the end of a decade. Each some while leaving others in similar circumstances state should be allowed to determine how and to with nothing, the federal government should begin what extent it replaces federal housing programs to transfer responsibility for the administration with alternative programs designed and funded by and costs of low-income housing programs to the state and local authorities. states, which are better equipped to assess and meet

ADDITIONAL READING " Robert Rector and Rachel Shefeld, “Setting Priorities for Welfare Reform,” Heritage Foundation Issue Brief No. 4520, February 24, 2016. " Rachel Shefeld, “Welfare Reform and Upward Mobility Act Can Restart Welfare Reform,” Heritage Foundation Issue Brief No. 4619, October 28, 2016. LABOR/HHS

PROPOSAL STATUS EXPLANATION

Reduces funding for rental assistance programs and PARTIALLY President’s Budget (FY2020) "recognizes the need for greater contributions from INCLUDED State and local governments."

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 213 The Heritage Foundation | heritage.org/BlueprintForBalance $11.0 MANDATORY SAVINGS IN BILLIONS31

Eliminate Supplemental Security Income Beneﬁts for Children

The original intent of Supplemental Security Low-income parents with a disabled child are Income was to provide cash assistance to adults eligible for cash assistance from the Temporary who are unable to support themselves because of a Assistance for Needy Families program, as well as disability and to the low-income elderly, but SSI also for benefits from various other means-tested wel- provides cash assistance to households with chil- fare programs such as Medicaid and food stamps. dren who are functionally disabled and who come Parents of children who are no longer receiving SSI from low-income homes. Today, about 15 percent of cash benefits would continue to be eligible for these SSI recipients are children. SSI should be reformed other means-tested welfare programs. Any medical to serve its originally intended population by ending expenses arising from a child’s disability that are benefits for children. not covered by another program, such as Medicaid, should be provided by SSI.

ADDITIONAL READING " Robert Rector and Romina Boccia, “How the ABLE Act Would Expand the Welfare State,” Heritage Foundation Backgrounder No. 2972, November 10, 2014.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

214 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $0 MANDATORY (NO SAVINGS)32

Strengthen Work Requirements in the Temporary Assistance for Needy Families Program Today, the majority of work-eligible TANF recip- Moreover, among the half of TANF recipients that ients are idle, neither working nor preparing for fulfill the work requirements, most are simply part- work. This is partly because states are taking time workers. advantage of loopholes that allow them to fulfill the work requirement without actually having to move State welfare bureaucracies have generally done recipients into work activity, but the main reason little if anything to promote this employment, but is that the work-participation rate is too low. Only they still take the credit. TANF’s work require- 50 percent of able-bodied adults are required to ment should be strengthened so that 75 percent of participate in work activities, which means that the a state’s non-employed TANF caseload is partici- other 50 percent of the caseload can be completely pating in work activities for 20 hours to 30 hours idle and the state is still fulfilling the requirement. per week.

PROPOSAL STATUS EXPLANATION

Requires that able-bodied, working-age TANF recipi- President’s Budget (FY2020) INCLUDED ents participate in work or work activities in order to receive beneﬁts.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 215 The Heritage Foundation | heritage.org/BlueprintForBalance $1.8 MANDATORY SAVINGS IN BILLIONS33

Eliminate Funding for the Social Services Block Grant

The Social Services Block Grant is one of several States and localities are better positioned to address welfare block grants created in the 1980s. Despite the needs of their target populations that are not more than $180 billion in inﬂation-adjusted already addressed by other federal means-tested spending, the SSBG has never served as a vehicle programs. Policymakers should end the SSBG, of reform. The services ofered through SSBG are devolve responsibility for its goals back to the states, inefective because they are duplicative, poorly and restore real federalism to the welfare system. targeted, and not funded on the basis of measured performance outcomes.

ADDITIONAL READING " Robert Rector and Vijay Menon, “Understanding the Hidden $1.1 Trillion Welfare System and How to Reform It,” Heritage Foundation Backgrounder No. 3294, April 5, 2018. " Robert Rector and Rachel Shefeld, “Setting Priorities for Welfare Reform,” Heritage Foundation Issue Brief No. 4520, February 24, 2016.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

216 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $725 DISCRETIONARY SAVINGS IN MILLIONS34

Eliminate Funding for the Community Services Block Grant

The Community Services Block Grant is one of States and localities are better positioned to address several welfare block grants created in the 1980s. the needs of their target populations that are not Despite more than $25 billion in inﬂation-adjusted already addressed by other federal means-tested spending, the CSBG has never served as a vehicle programs. Policymakers should end the CSBG, of reform. CSBG funds are poorly targeted and not devolve responsibility for its goals back to the states, directly linked to measured performance outcomes. and restore real federalism to the welfare system.

ADDITIONAL READING " Robert Rector and Vijay Menon, “Understanding the Hidden $1.1 Trillion Welfare System and How to Reform It,” Heritage Foundation Backgrounder No. 3294, April 5, 2018. " Robert Rector and Rachel Shefeld, “Setting Priorities for Welfare Reform,” Heritage Foundation Issue Brief No. 4520, February 24, 2016.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 217 The Heritage Foundation | heritage.org/BlueprintForBalance $3.7 DISCRETIONARY SAVINGS IN BILLIONS35

Eliminate Funding for the Low Income Home Energy Assistance Program The Low Income Home Energy Assistance program already addressed by other federal means-tested is one of several welfare block grants created in the programs. In fact, state policy changes in recent 1980s. Despite over $120 billion in inﬂation-ad- decades have rendered LIHEAP unnecessary. justed spending, LIHEAP has never served as a Additionally, endemic fraud and abuse undermine vehicle of reform. the program’s integrity. Policymakers should end LIHEAP, devolve responsibility for its goals back to States and localities are better positioned to address the states, and restore real federalism to the wel- the needs of their target populations that are not fare system.

ADDITIONAL READING " Robert Rector and Vijay Menon, “Understanding the Hidden $1.1 Trillion Welfare System and How to Reform It,” Heritage Foundation Backgrounder No. 3294, April 5, 2018. " Robert Rector and Rachel Shefeld, “Setting Priorities for Welfare Reform,” Heritage Foundation Issue Brief No. 4520, February 24, 2016.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

218 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $3.3 DISCRETIONARY SAVINGS IN BILLIONS36

Eliminate the Community Development Block Grant

In the 1980s, President Ronald Reagan created the Despite nearly $200 billion in inﬂation-adjusted Community Development Block Grant along with spending, there is little measurable evidence that several other welfare block grants. Operated by this program works as intended. Policymakers HUD, the CDBG was intended to provide housing should therefore end federal funding for the CDBG. assistance for low-income families, but its funds have often been funneled to high-income communities and to wasteful pork-barrel projects.

ADDITIONAL READING " Robert Rector and Vijay Menon, “Understanding the Hidden $1.1 Trillion Welfare System and How to Reform It,” Heritage Foundation Backgrounder No. 3294, April 5, 2018. " Patrick Louis Knudsen, “Tight Budget? Congress Can Save $42 Billion by Eliminating Bad Government Programs,” Heritage Foundation Backgrounder No. 2837, August 29, 2013. " Kathryn Nix and Emily Gof, “Community Development Block Grants: Waste the Continuing Resolution Should Cut,” The Daily Signal, February 16, 2011. LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 219 The Heritage Foundation | heritage.org/BlueprintForBalance $440 MANDATORY SAVINGS IN MILLIONS37

Require Counting of Income from Ineligible Noncitizens When Calculating Food Stamp Benefits Food stamp benefits are based on a household’s There is no reason why the income of a household “countable” income. The lower a household’s member should not be counted when it comes to countable income is, the higher its benefits will determining food stamp eligibility for the house- be. Although U.S. Department of Agriculture guid- hold, even if that member is ineligible for food ance says that “all of the ineligible non-citizens’ stamps himself. Although food stamps are osten- resources are countable for SNAP purposes,”38 not sibly limited to eligible recipients, they are used to all states actually count these resources. purchase food for the entire household. Therefore, policymakers should require that the income of ineligible noncitizens be counted when determining household eligibility.

ADDITIONAL READING " Robert Rector and Katherine Bradley, “Reforming the Food Stamp Program,” Heritage Foundation Backgrounder No. 2708, July 25, 2012.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Cuts spending by $32 million. INCLUDED

220 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $1.0 DISCRETIONARY SAVINGS IN BILLIONS39

Sunset Head Start to Make Way for Better State and Local Alternatives

In addition to its questionable constitutional status Low-income families should not have to depend on as a federal government function, Head Start has distant, inefective federal preschool and child care failed to live up to its stated mission of improving programs. Congress should sunset the federal Head kindergarten readiness for children from low-in- Start program over a period of 10 years to give states come families. In December 2012, the Department time to assume revenue responsibility, if necessary. of Health and Human Services, which adminis- Congress should begin by reducing Head Start fund- ters Head Start, released a scientiﬁcally rigorous ing by 10 percent in FY 2020. Ultimately, Head Start evaluation of the program’s impact on more than would be completely phased out by 2029. 5,000 participating children. It found that Head Start had little to no impact on the cognitive skills, social-emotional well-being, health, or parenting practices of participants.

ADDITIONAL READING " Lindsey M. Burke and David B. Muhlhausen, “Head Start Impact Evaluation Report Finally Released,” Heritage Foundation Issue Brief No. 3823, January 10, 2013. " David B. Muhlhausen, “The Head Start CARES Demonstration: Another Failed Federal Early Childhood Education Program,” Heritage Foundation Backgrounder No. 3040, August 6, 2015. LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at FY 2019 levels.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 221 The Heritage Foundation | heritage.org/BlueprintForBalance $8.8 DISCRETIONARY SAVINGS IN BILLIONS40

Eliminate Competitive and Project Grant Programs and Reduce Spending on Formula Grants If the federal government is going to continue to Since the 1970s, inﬂation-adjusted federal educa- spend tax dollars on the quintessentially state and tion spending per pupil has more than doubled. local function of education, federal policymakers The Every Student Succeeds Act alone authorizes should limit and better target education spending dozens of competitive and formula grant programs, by streamlining the labyrinth of federal education many of which are both redundant and inefective. programs. Competitive grant programs authorized Federal education programs have failed to improve under the Elementary and Secondary Education Act K–12 education nationally and have imposed a tre- are inefective and inappropriate at the federal level. mendous bureaucratic compliance burden on states They should be eliminated, and federal spending and local school districts. To ensure that state and should be reduced to reﬂect remaining formula local school leaders’ focus is oriented toward meet- grant programs authorized under Title I of the ing the needs of students and parents rather than ESEA and the handful of other programs that do not satisfying federal bureaucrats, program count and fall under the competitive/project grant category. associated federal spending should be curtailed. Remaining programs managed by the Department of Education, such as large formula grant programs for K–12 education, should be reduced by 10 percent.

ADDITIONAL READING " Lindsey M. Burke, “How the A-PLUS Act Can Rein in the Government’s Education Power Grab,” Heritage Foundation Backgrounder No. 2858, November 14, 2013. " Lindsey M. Burke, “Reducing the Federal Footprint on Education and Empowering State and Local Leaders,” Heritage Foundation Backgrounder No. 2565, June 2, 2011.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

PARTIALLY Cuts 29 programs, most of which are discretionary President’s Budget (FY2020) INCLUDED spending.

222 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance –$1.2 DISCRETIONARY INCREASE IN BILLIONS41

Decouple Federal Student Aid from Accreditation

The federal government’s involvement in the Additionally, students should be granted flexibility accreditation process restricts the flourishing of with their federal student aid to pursue individual innovation in higher education. The current pro- courses that serve their needs rather than being cess in which accreditors serve as gatekeepers of limited to enrolling in a costly and often inefcient federal student aid dollars also does very little to degree program. A reformed accreditation pro- ensure that students are getting a quality education cess, coupled with lower caps on student lending that has application in the marketplace. Decoupling and elimination of loan forgiveness policies, could federal financing from the accreditation process provide this needed flexibility for students. This and allowing states to recognize their own accred- proposal was included in the Higher Education itors would bring needed reform and flexibility to Reform and Opportunity Act of 2017, introduced in the system. the 115th Congress by former Representative Ron DeSantis (R–FL) and Senator Mike Lee (R–UT).42

ADDITIONAL READING " Jamie Bryan Hall and Mary Clare Reim, “Time to Reform Higher Education Financing and Accreditation,” Heritage Foundation Issue Brief No. 4668, March 28, 2017. LABOR/HHS

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 223 The Heritage Foundation | heritage.org/BlueprintForBalance $2.3 DISCRETIONARY SAVINGS IN BILLIONS43

Eliminate the PLUS Loan Program

The PLUS Loan program, which allows parents of Both graduate students and the parents of under- undergraduate students and graduate students to graduate students can borrow through the PLUS borrow from the federal government up to the full Loan program, which provides federal loans beyond cost of attendance at a university, is a considerable the main federal lending programs. Ultimately, driver of tuition inflation. Evidence suggests that eliminating the PLUS Loan program will put virtually unrestricted access to federal student aid downward pressure on tuition prices, discourage leads to tuition inflation. To bring down college family-level debt, and create space for private lend- costs and reduce dependence on federal student aid ers to enter the student loan market. programs to finance higher education, policymakers should place strict lending caps on federal student aid and eliminate the PLUS Loan program.

ADDITIONAL READING " Mary Clare Amselem: “The Case for Private Student Loans,” Heritage Foundation Commentary, May 23, 2017. " Mary Clare Amselem, “Seven Essential Policies for a Higher Education Act Reauthorization,” Heritage Foundation Issue Brief No. 4767, September 22, 2017.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

224 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $5.5 DISCRETIONARY SAVINGS IN BILLIONS44

Place Strict Lending Caps on All Federal Aid Programs

Unrestricted access to federal student aid has been The Higher Education Reform and Opportunity Act a signiﬁcant contributor to the skyrocketing cost of of 2017, introduced in the 115th Congress by former higher education. Additionally, the federal gov- Representative Ron DeSantis (R–FL) and Senator ernment originates 90 percent of all student loans, Mike Lee (R–UT), proposes a lending cap of $30,000 crowding out private lenders and leaving taxpayers for undergraduate students and $40,000 for grad- on the hook for defaults and loan forgiveness. To uate students. These caps represent sound higher drive down college costs and reduce taxpayer expo- education policy that would protect students and sure to high levels of student debt, policymakers taxpayers alike. Additionally, an annual lending cap should place lower, strict borrowing caps on federal of $7,500 would help to prevent excessive lending student loans. This policy would encourage colleges and put downward pressure on tuition prices. to ofer competitive prices to students and allow the private lending market to emerge and ofer more options to students.

ADDITIONAL READING " Mary Clare Amselem, “Soaring Student Debt Costs Us All,” Heritage Foundation Commentary, August 18, 2017. " Mary Clare Amselem, “The Case for Private Student Loans,” Heritage Foundation Commentary, May 23, 2017. LABOR/HHS

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) Expands eligibility for the Pell Grant program. ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 225 The Heritage Foundation | heritage.org/BlueprintForBalance $7.3 MANDATORY SAVINGS IN BILLIONS45

Eliminate the Mandatory Funding Add-On to Pell Grants

Pell Grants are currently funded by a convoluted through the Pell Grant funding add-on, authorized combination of mandatory and discretionary funds. as mandatory funding. Congress should have the In the 2019–2020 academic year, students can discretion to reevaluate the maximum funding receive a maximum amount of $5,135 under the for the Pell Grant program annually, which is not discretionary component alone. However, the max- currently possible with the Pell add-on because it is imum amount can be increased by $1,060 to $6,195 included in mandatory spending.

ADDITIONAL READING " Mary Clare Amselem, “Soaring Student Debt Costs Us All,” Heritage Foundation Commentary, August 18, 2017. " David Ditch, “Congress Sees Hundreds of Millions in New Spending as an Afterthought,” The Daily Signal, September 28, 2018.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

Eliminates the in-school interest subsidy but does not President’s Budget (FY2020) REJECTED remove the cap on interest rates.

226 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $700 MANDATORY SAVINGS IN MILLIONS46

Remove the Cap on Interest Rates for Student Loans

The federal direct loan program currently places make better ﬁnancial decisions about their aca- congressionally determined caps on interest rates demic futures when they are given all of the correct for student loans. While current interest rates oper- information about their loans and the possibilities ate below this cap, such a cap should not exist at all. for repayment. Interest rates often serve as a valu- It should be removed so that the market, not gov- able tool in that decision-making process. ernment, can inﬂuence loan interest rates. Students

ADDITIONAL READING " Mary Clare Amselem, “Seven Essential Policies for a Higher Education Act Reauthorization,” Heritage Foundation Issue Brief No. 4767, September 22, 2017.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

Eliminates the Public Service Loan Forgiveness program PARTIALLY President’s Budget (FY2020) but ofers more generous loan forgiveness terms for INCLUDED Staford loans.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 227 The Heritage Foundation | heritage.org/BlueprintForBalance $370 DISCRETIONARY SAVINGS IN MILLIONS47

Eliminate All Time-Based and Occupation-Based Loan Forgiveness

Americans are struggling under $1.5 trillion in Not only does loan forgiveness transfer large student loan debt. Unfortunately, when students amounts of student debt onto the backs of taxpay- cannot aford to pay of their student loans, Amer- ers, but it also encourages excessive borrowing on ican taxpayers end up with that bill because of the part of students, conﬁdent that after a certain federal loan forgiveness policies and borrower number of years their loans will be eliminated. defaults. Students who take out federal loans can To restore ﬁscal responsibility to higher educa- have their loans forgiven after 20 years of pay- tion and insulate taxpayers from outstanding ments, and the loans of public service employees are student loan debt, policymakers should eliminate forgiven after just 10 years under current law. The loan forgiveness. Congressional Budget Ofce estimates that student loan forgiveness will cost American taxpayers, the majority of whom do not hold bachelor’s degrees, $108 billion over the next 10 years.48

ADDITIONAL READING " Mary Clare Amselem, “Time for a Time-Out on Wasteful Federal Student Loan Programs,” Heritage Foundation Commentary, October 10, 2017.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

PARTIALLY Not addressed, although the Administration is taking President’s Budget (FY2020) INCLUDED steps to reform the rule.

228 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $0 DISCRETIONARY (NO SAVINGS)49

Rescind “Gainful Employment” Regulations on For-Profit Higher Education Institutions The Higher Education Act stipulates that to be eli- might choose a for-profit institution because of its gible for federal student aid, colleges must prepare flexibility and afordability. students for “gainful employment in a recognized occupation.” The U.S. Department of Education The Trump Administration should enable private aggressively promulgated rules concerning gainful for-profit and vocational colleges to continue to employment during the Obama Administration, and serve students who have been historically under- gainful employment regulations primarily afect- served by traditional universities. It can do this by ing for-profit institutions went into efect on July repealing the gainful employment regulations that 1, 2015. In particular, these regulations could limit took efect on July 1, 2015. opportunities for non-traditional students, who

ADDITIONAL READING " Lindsey M. Burke, “Reauthorizing the Higher Education Act—Toward Policies that Increase Access and Lower Costs,” Heritage Foundation Backgrounder No. 2941, August 19, 2014. LABOR/HHS

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 229 The Heritage Foundation | heritage.org/BlueprintForBalance $1.2 DISCRETIONARY SAVINGS IN BILLIONS50

Eliminate Funding for 21st Century Community Learning Centers

A 2017 Government Accountability Ofce review their non-participating peers and “more likely to of the literature on the 21st Century Community engage in some negative behaviors.”52 Learning Centers Program (21st CCLC), which provides additional federal funding for after-school In addition to limited positive impacts on partici- programs, found that none of the studies in its pants, funding after-school programs is outside the review produced “consistently better scores in scope of the federal government. After-school pro- either math or reading.”51 Research has also demon- grams should be locally funded or provided through strated that 21st CCLC participants are “no more private options. likely to have higher academic achievement” than

ADDITIONAL READING " David B. Muhlhausen, “Trump’s Responsible Decision to End an After-School Program that Harms Children,” The Daily Signal, March 17, 2017. " Lindsey M. Burke, Jude Schwalbach, and Jonathan Butcher, “Funding Education Savings Accounts for Military Families by Repurposing the 21st Century Community Learning Centers Program,” Heritage Foundation Issue Brief No. 4930, December 20, 2018.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

230 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $190 DISCRETIONARY SAVINGS IN MILLIONS53

Eliminate Comprehensive Literacy Development Grants

Congress should eliminate funding for the A better situation would be to compare the per- redundant and costly Comprehensive Literacy formance of students in the SRCL program to a Development Grants. This program was authorized comparison group with students who have similar as part of the FY 2010 Consolidated Appropria- characteristics.”54 tions Act to advance reading skills for students from pre-school age through grade 12. These grants Federal and local programs already exist to facilitate do not have a proven record of success to justify the development of childhood literacy. Such educa- taxpayer spending, and federal agencies have yet to tional programs are better handled at the state and conduct any rigorous evaluations of the program. local levels and should be managed by the local lead- As the Department of Education has explained, ers who understand local contexts and how to target “Evaluation activities primarily included surveys such initiatives efectively. The federal government of teachers and school leaders to gauge percep- should not be funding and administering childhood tions of professional development activities…. literacy programs.

ADDITIONAL READING " U.S. Department of Education, Ofce of Elementary and Secondary Education, EDTASS: Striving Readers Comprehensive Literacy (SRCL), 5.2—National Performance Report: 2014–15, September 2016. LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 231 The Heritage Foundation | heritage.org/BlueprintForBalance $840 DISCRETIONARY SAVINGS IN MILLIONS55

Eliminate Federal Supplemental Educational Opportunity Grants

Federal Supplemental Educational Opportunity Federal higher education subsidies should be lim- Grants ofer additional needs-based assistance to ited and well targeted. Congress should focus its undergraduate students to help them pay for college. policy priorities on limiting federal aid programs Numerous federal aid programs already exist to help and eliminating redundant or inefective programs students ﬁnance their college education, including in order to drive down college costs and restore direct loan programs and the Pell Grant program private lending options for students. There is no evi- for low-income students. Congress already spends dence that Supplemental Educational Opportunity upwards of $28 billion every year on the Pell Grant Grants have been successful in helping students to program, which in some circumstances can cover the complete their degrees in a timely manner, and the entire cost of tuition at community colleges. Further- program should be eliminated. more, the evidence suggests that excessive federal higher education subsidies lead to tuition inﬂation.

ADDITIONAL READING " Lindsey M. Burke, “Reauthorizing the Higher Education Act—Toward Policies that Increase Access and Lower Costs,” Heritage Foundation Backgrounder No. 2941, August 19, 2014.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

232 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $360 DISCRETIONARY SAVINGS IN MILLIONS56

Eliminate GEAR UP

Gaining Early Awareness and Readiness for Under- it has met its goal of increasing college readiness for graduate Programs (GEAR UP) is a costly program disadvantaged students. that exists ostensibly to increase the number of low-income students enrolled in college and help Additionally, it is not the proper role of the federal these students navigate the pathway from high government to provide taxpayer dollars to create school to higher education. The federal government a pipeline from high school to college. GEAR UP should not be providing funds under the premise should be eliminated, and its functions should that higher education is the sole option for students instead be handled privately or at the state and local after high school. Many students would be better levels, where policymakers are better equipped served by short-term career-centered programs. to increase college preparedness within their GEAR UP adds to already high levels of higher school districts. education spending, and there is little evidence that

ADDITIONAL READING " Lindsey M. Burke, “Advancing School Choice and Restoring State and Local Control of Education Through A-PLUS,” Heritage Foundation Issue Brief No. 4679, April 5, 2017. " Lindsey M. Burke, “Reauthorizing the Higher Education Act—Toward Policies that Increase Access and Lower Costs,” Heritage Foundation Backgrounder No. 2941, August 19, 2014. LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 233 The Heritage Foundation | heritage.org/BlueprintForBalance $1.2 DISCRETIONARY SAVINGS IN BILLIONS57

Eliminate Student Support and Academic Enrichment Grants

Student Support and Academic Enrichment Grants, school districts and are outside the scope of the authorized under the Every Student Succeeds Act federal government. of 2015, are awarded to school districts that already receive Title I funds. According to the Department Such goals are extremely broad and difcult to of Education, the program exists to “(1) provide all quantify, and they do not justify federal involve- students with access to a well-rounded education; ment. States and localities already dedicate (2) improve school conditions for student learn- resources to improving school environments and ing; (3) improve the use of technology in order to the use of technology. Student Support and Aca- improve the academic achievement and digital lit- demic Enrichment Grants should be cut from the eracy for all students.”58 Ultimately, however, these federal budget. grants are unlikely to spark meaningful reform in

ADDITIONAL READING " Lindsey M. Burke, “Advancing School Choice and Restoring State and Local Control of Education Through A-PLUS,” Heritage Foundation Issue Brief No. 4679, April 5, 2017.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

234 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $2.1 DISCRETIONARY SAVINGS IN BILLIONS59

Eliminate Supporting Efective Instruction State Grants

Supporting Efective Instruction (SEI) state grants that general reductions in class size will yield any are used primarily for class-size reduction and average improvement in student achievement.”61 professional development. According to the Trump Administration’s FY 2020 budget proposal, “SEI Taxpayer dollars should be directed toward con- grants are poorly targeted and funds are spread too stitutionally sound programs with demonstrated thinly to have a meaningful impact on student out- evidence of success. Because the heavy taxpayer comes.”60 There is little if any return on investment investment in SEI grants does not meet that stan- from teacher professional development programs, dard, this program should be eliminated. and as Stanford economist Eric Hanushek has documented, the empirical evidence “gives no indication

ADDITIONAL READING

" Eric A. Hanushek, “The Evidence on Class Size,” Chapter 7 in Earning and Learning: How Schools Matter, ed. Susan E. Mayer and Paul E. Peterson (Washington: Brookings Institution Press, and New York: Russell Sage Foundation, 1999), pp. 131–168. LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 235 The Heritage Foundation | heritage.org/BlueprintForBalance $318 DISCRETIONARY SAVINGS IN MILLIONS62

Eliminate Competitive Teaching Grant Programs

Policymakers should eliminate the four competi- Distributing grants to these localities to assist them tive teaching grant programs: Supporting Efective in recruiting high-quality teachers is not properly Educator Development (SEED); Teacher and School a function of the federal government. Instead, local Leader Incentive Grants (TSLIG); and Teacher policymakers and school leaders should focus their Quality Partnerships (TQP). All of these programs eforts on instituting merit pay and removing out- aim generally to improve teacher quality and difer dated policies like “last in first out” to recruit and only slightly in their stated purposes. States and retain the most qualified public school teachers. The localities all across the country, on the other hand, federal government should not use limited taxpayer difer significantly with respect to their hiring needs dollars to supplement state eforts. in public schools.

ADDITIONAL READING " Lindsey M. Burke, “Advancing School Choice and Restoring State and Local Control of Education Through A-PLUS,” Heritage Foundation Issue Brief No. 4679, April 5, 2017.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

236 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $445 DISCRETIONARY SAVINGS IN MILLIONS63

Privatize the Corporation for Public Broadcasting

The CPB was created in 1967 at a time when U.S. operates. Both organizations could seek to make households faced very limited broadcasting options. up the lost funding by increasing revenues from Since then, technology has grown, and the number corporate sponsors, foundations, and members. of media sources for accessing news and broad- NPR states that its member stations receive only 4 casting is much greater. The CPB has already been percent of their overall funding from federal, state, appropriated $445 million per year in advance fed- and local governments.65 eral funding through FY 2021.64 The President’s FY 2019 budget called for rescinding all but $15 million Many nonprofits manage to stay in business with- of that amount. out receiving federal funding by being creative and reacting to market fluctuations. Public broadcasters Without federal funding from the CPB, services should be no exception. NPR and PBS should find such as the Public Broadcasting Service and new sponsors, create new shows, and find alterna- National Public Radio would operate as any other tive ways to generate viewership without receiving news or broadcasting source in the private sector taxpayer funding.

ADDITIONAL READING " Mike Gonzalez, “Stop Forcing Taxpayers to Fund Public Broadcasting,” Heritage Foundation Commentary, November 6, 2017. " Emily Gof, “Why Big Bird’s Federal Subsidies Need to Go,” The Daily Signal, October 14, 2012. " BDO, “Public Broadcasting Service and Subsidiaries: Consolidated Financial Statements and Independent Auditor’s Report, Years Ended June 30, 2014 and 2013,” October 30, 2014. LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 237 The Heritage Foundation | heritage.org/BlueprintForBalance $787 DISCRETIONARY SAVINGS IN MILLIONS66

Eliminate the Corporation for National and Community Service

The CNCS is a federal agency created to promote in unobligated balances from the National Service public service and support the institutions of civil Trust, which had been created to cover interest society. It operates four main programs—Ameri- on qualiﬁed student loans while individuals serve Corps, Senior Corps, the Social Innovation Fund, in AmeriCorps. and the Volunteer Generation Fund—as well as other public service–oriented programs. These The CNCS should be eliminated. Charitable giving programs are funded by federal dollars, in-kind is an individual choice, and Americans should be donations, and public–private partnerships. free to choose whether they want to give their time and money to charities, which charities they want Civil society is critical to a strong and prosperous to support, and how much they want to give. The United States, but it is not the proper role of the CNCS deprives individuals of this choice and forces federal government to intervene in this sector. taxpayers to subsidize particular charities chosen Americans already give to charity and volunteer by the government. If the hand-picked charities their time. In 2017, according to the Charities included in the CNCS provide valuable services that Aid Foundation, 158 million Americans donated Americans deem worthy of their time and money, money to charity, and 102 million spent time those charities will have the opportunity to main- volunteering.67 Moreover, the CNCS is not using a tain their operations through private donations in signiﬁcant portion of its current federal funding. the same way that other charitable organizations The FY 2019 Defense and Labor/Health and Human receive their funds. Services appropriation bill rescinded $150 million

ADDITIONAL READING " Matthew Spalding, “Principles and Reforms for Citizen Service,” Heritage Foundation Backgrounder No. 1642, April 1, 2003.

LABOR/HHS " Patrick Louis Knudsen, “Tight Budget? Congress Can Save $42 Billion by Eliminating Bad Government Programs,” Heritage Foundation Backgrounder No. 2837, August 29, 2013.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

238 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $242 DISCRETIONARY SAVINGS IN MILLIONS68

Eliminate Funding for the Institute of Museum and Library Services

The IMLS is an independent agency that admin- which strive to enhance the ability of museums to isters federal funds to libraries and museums. In serve the public. The IMLS also supports special 2019, Congress appropriated $242 million for the and tribal libraries, as well as various museums. agency. A primary focus of the institute’s activity is its Grants to States program, which “annually pro- It is not the proper role of the federal government vides population-based grants to each state’s library to give grants to libraries and museums when these administrative agency.”69 The agency also admin- institutions are already being funded at the state isters smaller grants such as the Laura Bush 21st and local levels. The federal government should Century Librarian Program, which funds librarian devolve funding decisions for these institutions workforce development, and Museums for America, back to states and localities.

ADDITIONAL READING

" Sven R. Larsen, “Federal Funds and State Fiscal Independence,” Heritage Foundation Backgrounder No. 2136, May 15, 2008. " Patrick Louis Knudsen, “Tight Budget? Congress Can Save $42 Billion by Eliminating Bad Government Programs,” Heritage Foundation Backgrounder No. 2837, August 29, 2013. LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 239 The Heritage Foundation | heritage.org/BlueprintForBalance $208.7 DISCRETIONARY SAVINGS IN MILLIONS70

Cut the Annual Smithsonian Institution Subsidy by 20 Percent and Cap It at That Amount The Smithsonian Institution was founded through Smithsonian’s appropriation increased by $180 mil- a donation by James Smithson in 1846. It was lion, with all but $2 million of the new funding used established for the purpose of increasing and dif- for the National Air and Space Museum’s multi-year fusing knowledge. With 19 museums and galleries, revitalization and other facilities projects. nine research centers, and the National Zoo, the Smithsonian is the world’s largest museum and Both public and private institutions often engage research complex. in widespread fundraising activities to fund capital projects. The Smithsonian Institution should The Smithsonian Institution is one of the world’s continue to use its name recognition to expand best-known museums. Trust funds, government its private donor base to pay for new projects and grants and contracts, and private donations recurring expenses instead of asking taxpayers to accounted for an estimated 30 percent of its do so. budget in 2018. Between FY 2017 and FY 2018, the

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at FY 2019 levels.

240 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $65 DISCRETIONARY SAVINGS IN MILLIONS71

Reduce Funding for the Department of Education’s Office for Civil Rights The OCR is tasked with ensuring equal access to The Trump Administration has taken steps to education and enforcing civil rights laws. In recent correct the previous Administration’s actions years, the department has abused its power by that undermined the rule of law by rescinding the interpreting “sex” to mean “gender identity,” essen- Obama Administration’s gender identity74 and tially rewriting the law to require access to intimate sexual assault75 school policies. In addition, the OCR facilities, dorms, and sports programs for students budget should be cut signiﬁcantly so that schools based on self-declared gender identity rather than can make policies that will best serve all members of biology.72 Moreover, the department has violated the their communities. principles of due process by requiring an unfairly low burden of proof for adjudicating claims of sexual harassment or assault and making it exceedingly difcult for the accused to defend themselves.73

ADDITIONAL READING " Ryan T. Anderson, “Obama Unilaterally Rewrites Law, Imposes Transgender Policy on Nation’s Schools,” The Daily Signal, May 13, 2016. " Hans von Spakovsky, “Campus Sexual Assault: Understanding the Problem and How to Fix It,” Heritage Foundation Legal Memorandum No. 211, July 25, 2017. LABOR/HHS

PROPOSAL STATUS EXPLANATION

Increases funding to $125 million from the FY 2019 level President’s Budget (FY2020) REJECTED of $107 million.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 241 The Heritage Foundation | heritage.org/BlueprintForBalance $115.9 MANDATORY SAVINGS IN BILLIONS76

Reform Medical Liability for Federal Health Programs

The current medical liability system does not work arising out of a health care liability claim or action for patients or providers. Nor does it promote and any person on whose behalf such a claim is high-quality, evidence-based care. Providers prac- asserted or such an action is brought, whether tice with a threat of potentially frivolous lawsuits, deceased, incompetent, or a minor. and injured patients often do not receive just compensation for their injuries. Speciﬁcally, the proposal includes placing a cap on non-economic damage awards of $250,000 (increas- This proposal would reform medical liability and ing with inﬂation over time); specifying a three-year reduce defensive medicine by implementing a set statute of limitations; allowing courts to modify of provisions to reduce the number of high-dollar attorney’s fee arrangements; allowing evidence of awards, limit liability, reduce provider burden, pro- a claimant’s payments from other sources, such as mote evidence-based practices, and strengthen the workers’ compensation and auto insurance, to be physician–patient relationship. These requirements introduced at trial; creating a safe harbor for clini- would apply to any individual who brings a health cians who follow evidence-based clinical practice care lawsuit and who used medical services for guidelines; and authorizing the Secretary of Health which Medicaid, Medicare, and other federal health and Human Services to create expert panels and programs paid, either in whole or in part, including administrative health care tribunals to review medi- a person who asserts or claims a right to legal or cal liability cases. equitable contribution, indemnity, or subrogation

LABOR/HHS

PROPOSAL STATUS EXPLANATION

Caps non-monetary damages at $250,000, adds a President’s Budget (FY2020) INCLUDED statute of limitations, and includes additional reforms.

242 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $0 MANDATORY (NO SAVINGS)77

End Provider Taxes in Medicaid

Some states employ provider tax schemes that limited to using no more than 6 percent of provider consist of increasing their Medicaid reimburse- tax revenues. ment rate for providers but then “taxing back” a portion of that increased payment. Because federal Congress should either eliminate this threshold match rates are based on total payment amounts, altogether or further reduce it. This policy would the efect of this state policy is to increase federal stop the “state gaming” of reimbursement and bring reimbursement beyond the level the state would greater transparency to the ﬁnancing of Medicaid. receive without the provider tax. Today, states are

LABOR/HHS

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 243 The Heritage Foundation | heritage.org/BlueprintForBalance $1.4 MANDATORY SAVINGS IN BILLIONS78

Consolidate and Reform the Financing of Graduate Medical Education Programs Graduate Medical Education (GME) programs Congress should reform the GME program by con- provide federal funding to help train physicians. The solidating GME ﬁnancing in a single discretionary largest porting of this funding is channeled to teach- funding source, shift management responsibili- ing institutions in the form of increased Medicare ties to the states, and require that funding follow payments. This federal structure ignores geographic the trainee and not be linked to the teach- disparities, is unresponsive to workforce needs, and ing institutions. lacks accountability and oversight.

ADDITIONAL READING " John S. O’Shea, “Reforming Graduate Medical Education in the U.S.,” Heritage Foundation Backgrounder No. 2983, December 29, 2014.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED Broadly consistent with recommendation.

244 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $0 MANDATORY (NO SAVINGS)79

Modify Payments to Hospitals for Uncompensated Care in Medicare and Medicaid The federal government through Medicare and Under this proposal, both the Medicare and Med- Medicaid provides hospitals with supplemental icaid formulas for hospital supplemental payments payments to ofset the costs of treating indigent, would be consolidated and transferred out of uninsured patients. The current system of payments Medicare and Medicaid into a discretionary funding to hospitals through uncompensated care payments mechanism based on actual hospital claims rather in Medicare and disproportionate-share payments than the current formulas. This reform would bring (DSH) in Medicaid is poorly targeted, insufciently greater transparency and accountability to the dis- accountable, and in need of reform. tribution of these payments.

LABOR/HHS

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED Broadly consistent with recommendation.

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 245 LABOR/HHS 246 provider thatmeets thespecific needsoftheirchildren. a parent-controlledESAthat thefamilycouldusetopay for any education-relatedservice,product,or and allfundingforchildren livingonbaseindistricts thatarenot directlyinto heavily impactedshould go to eligiblestudents. AllImpactAiddollarsformilitary-connected childreninheavily impacteddistricts students tothoseschoolsbasedonwhere theirparentsarestationed, ImpactAiddollarsshouldbedirected Aid. Instead offilteringthe$1.3billioninfederal ImpactAidfundingtodistrict schoolsandthenassigning Washington thenprovides taxpayer fundingtodistrict schoolsthroughafederalprogramcalledImpact learning needs, consigningthemtonearby district schoolsthatareclosest totheirparents’dutystation. models. Childrenofmilitaryfamiliescontinuetobeassignedschoolsthatmay ormay not meet their supports theeducationoffederallyconnectedchildren hasfailedtokeep pacewithnew educationdelivery of militarylifehave beenmodernizedover thepast century, the way inwhichthefederalgovernment Transition ImpactAidintoeducationsavings accountsformilitaryfamilies. without entanglementinabortionondemand. afliates andother abortionproviders wouldbeshiftedtoprogramsthatofercomprehensive healthcare not reducetheoverall fundingforwomen’s healthcare:Thefundscurrentlyflowing toPlannedParenthood receiving TitleXfamilyplanninggrants, Medicaid reimbursements, andother grantsandcontractswould Under therecommendation,disqualifyingPlannedParenthood afliatesandother abortionproviders from parts ofabortedinfants. tothePPFA Nofederal fundsshouldgo orany ofitsafliatesorhealthcenters. acute inlightofseriousanddisturbing presscoverage ofPPFA representatives discussing thesale ofbody Parenthood Federation ofAmericaanditsafliates. Theneedtoendsuchfunding hasbecomeeven more services. Redirect fundingfromPlannedParenthood tohealthcentersthatarenot entangledwithabortion and healthinsurancecoverage thatalignswithhisorhervalues. assaults onconsciencebeforeprotecting thefreedomofevery American toprovide, find,oroferhealthcare by theOfceforCivilRightsafternearlytwoyearsofinvestigation. Complaints totheU.S. DepartmentofHealth andHumanServicesaboutthestate’s mandateweredismissed religious organizations, religious schools, andeven churches, must includecoverage ofelective abortions. Healthof Managed Caremandatedthatalmost every healthplaninthestate, includingplansoferedby these protections and give victims a better In August path to relief is urgent. 2014, the California Department Congress shouldalsoallow victim-of-conscienceviolationstobevindicatedincourt. and healthinsuranceplansbecausetheydonot perform,pay for, refer, orprovide coverage forabortions. andfederallyfundedprograms thatdiscriminateagainstagencies healthcareproviders, organizations, abortion, whether intheU.S. orabroad.In addition, Congressshouldcodifyprohibitionsongovernment riders thatprevent federalfundingfrombeingentangledwiththeprovision, coverage,of oradvocacy Protect freedomofconscienceinhealthcare. caseload isparticipatinginworkactivitiesfor20hoursto30perweek. Congress should strengthen TANF’s work requirement so that 75 percent of a state’s non-employed TANF bureaucracies havedonelittle generally ifanything topromote thisemployment, buttheystill take thecredit. among the half of TANF recipients that fulfill the work requirements, most are working part time. State welfare other 50 percent of the caseload may be completely idle, the state is still fulfilling the requirement. Moreover, percent of able-bodied adults are required to participate in work activities, which means that even though the recipients into work activity. The main reason, however, is that the work-participation rate is too low. Onlytake 50 advantage of loopholes that allow them to fulfill the work requirement without actually having to move percent across the states in FY 2017) are neither working nor preparing for work. Strengthen theTANF Program’s work requirements. POLICY RIDERS | Foundation Heritage The Taxpayer dollarsshouldnot beusedtofundelective abortionproviders like thePlanned Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A Congress shouldmaintainallexisting pro-lifepolicy 84 The majority of work-eligible TANF recipients (54.3 83 Policymakers shouldnot wait formore 81 80 This is partly because states Although many aspects 82 Theneedtocodify LABOR/HHS

FY 247 No. 3139, July 27, 2016, 2016, July 27, 3139, No. , Backgrounder National Job Corps Study: Findings Using Administrative Earnings Records Data, Data, Records Earnings Using Administrative Findings Study: Corps Job National A FEDERAL BUDGET FOR FISCAL YEAR 2020 , pp. 13 and 14, https://www.dol.gov/sites/dolgov/files/general/budget/2020/FY2020BIB.pdf https://www.dol.gov/sites/dolgov/files/general/budget/2020/FY2020BIB.pdf 13 and 14, , pp. , p. 36. Heritage experts assume that FY 2019 spending remains constant in FY 2020. constant remains spending FY 2019 that assume 36. Heritage experts , p. U.S. Department of Labor FY 2015 Annual Performance Report Annual Performance 2015 FY Labor of Department U.S. heritage.org/BlueprintForBalance Blueprint for Balance: , Mathematica Policy Research, October 2003, https://www.mathematica-mpr.com/api/sitecore/MediaLibrary/ActualDownl 2003, October Research, Policy , Mathematica https://www.heritage.org/jobs-and-labor/report/why-it-time-reform-compensation-federal-employees#_ftn3. Savings for FY 2020 have have FY 2020 for Savings https://www.heritage.org/jobs-and-labor/report/why-it-time-reform-compensation-federal-employees#_ftn3. reflect and to (fedscope.opm.gov) FedScope from available data employment federal 2018 June recent, the most reflect to been updated https://www.dol.gov/sites/default/files/documents/general/budget/CBJ-2017-V1-01.pdf (accessed April 6, 2019). April 6, (accessed https://www.dol.gov/sites/default/files/documents/general/budget/CBJ-2017-V1-01.pdf https://www.congress.gov/search?q=%7B%22source%22:%22legislation%22,%22search%22:%22cite:PL115-245%22%7D (accessed April 6, (accessed https://www.congress.gov/search?q=%7B%22source%22:%22legislation%22,%22search%22:%22cite:PL115-245%22%7D implementation in 2020 as opposed to 2017 as assumed in the original Heritage Foundation report and figures. FY 2020 savings are small are savings FY 2020 and figures. report in the original Heritage Foundation as assumed 2017 as opposed to in 2020 implementation in areas designated “Rest of U.S.” and that the average salary for employees in these areas is $54,297. The 15.37 percent “Rest of U.S.” of U.S.” “Rest percent 15.37 The is $54,297. in these areas employees salary for the average and that of U.S.” “Rest designated in areas levels for its caseload. This would save taxpayers $123 million in FY 2020. The NLRB’s projected FY 2019 budget authority is $274 million, is $274 authority budget FY 2019 projected NLRB’s The million in FY 2020. $123 taxpayers save would its caseload. This for levels Defense and Labor, Health and Human Services, and Education Appropriations Act, 2019 and Continuing Appropriations Act, 2019. Heritage 2019. Act, Appropriations and Continuing 2019 Act, Appropriations and Education Health and Human Services, and Labor, Defense Defense and Labor, Health and Human Services, and Education Appropriations Act, 2019 and Continuing Appropriations Act, 2019, which 2019, Act, Appropriations and Continuing 2019 Act, Appropriations and Education Human Services, Health and and Labor, Defense Is Time to Reform Compensation for Federal Employees,” Heritage Foundation Heritage Foundation Employees,” Federal for Compensation Reform to Is Time ce of Policy and Research. of Policy Division, Ofce and Training Employment of Labor, Department U.S. under both the WIOA and the Second Chance Act. Estimated savings exclude these $160 million and $93 million amounts. Heritage experts Heritage experts million amounts. $93 million and these $160 exclude savings Estimated Act. Chance and the Second under both the WIOA 6157, Department of Defense and Labor, Health and Human Services, and Education Appropriations Appropriations and Education and Human Services, Health Labor, and of Defense Department 6157, personnel compensation in line with private-sector compensation. in line with private-sector compensation personnel remains constant in FY 2020. Reducing the NLRB’s budget by 45 percent in FY 2020 would bring its spending in line with previous funding bring its spending in line with previous would in FY 2020 percent 45 by budget the NLRB’s Reducing in FY 2020. constant remains adjustment means that the average salary is $7,234 above the base salary for these areas. Thus, eliminating the “Rest of U.S.” locality pay pay locality of U.S.” the “Rest eliminating Thus, these areas. the base salary for above salary is $7,234 the average that means adjustment of U.S. “Rest GeneralSchedule.org, FY 2020. for million in savings in $268 result the base GS scale would back to those areas and reverting and Labor, Health and Human Services, and Education Appropriations Act, 2019 and Continuing Appropriations Act, 2019. Heritage experts Heritage experts 2019. Act, Appropriations and Continuing 2019 Act, Appropriations and Education Health and Human Services, and Labor, in FY 2020. constant spending remains FY 2019 that assume and Labor, Health and Human Services, and Education Appropriations Act, 2019 and Continuing Appropriations Act, 2019. This proposal proposal This 2019. Act, Appropriations and Continuing 2019 Act, Appropriations and Education Health and Human Services, and Labor, spending FY 2019 that assume million. Heritage experts $274 of the appropriated million or $123 percent, 45 spending by reduce would million. $151 to down spending bring its FY 2020 would percent of 45 reduction a proportional amount; and Labor, Health and Human Services, and Education Appropriations Act, 2019 and Continuing Appropriations Act, 2019. Heritage experts Heritage experts 2019. Act, Appropriations and Continuing 2019 Act, Appropriations and Education Health and Human Services, and Labor, in FY 2020. constant spending remains FY 2019 that assume assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume General Schedule Payscale,” https://www.generalschedule.org/localities/rest-of-us (accessed April 6, 2019). (accessed https://www.generalschedule.org/localities/rest-of-us Schedule Payscale,” General FY 2020 Department of Labor Budget in Brief Budget Labor of Department FY 2020 Final Report %7BEA39AE2D-BF35-41B0-9FD4-5550A46947C6%7D&fileMime=application%2Fpdf (accessed April 6, 2019). Contract report submitted to to submitted report Contract 6, 2019). April (accessed %7BEA39AE2D-BF35-41B0-9FD4-5550A46947C6%7D&fileMime=application%2Fpdf specifies $3.503 billion for activities including the WIOA, the Second Chance Act of 2007, and the Apprenticeship Act. Of this total, the act the act Of this total, Act. and the Apprenticeship of 2007, Act Chance the Second including the WIOA, activities billion for specifies $3.503 as authorized ender activities f ex-o million for $93 and lists programs apprenticeship opportunities for expand million to specifies $160 ect of the proposal would be to reduce salaries by 5 percent. Total savings over the 2020–2029 period would period would the 2020–2029 over savings Total 5 percent. salaries by reduce be to would of the proposal ect ef long-term The time. over bring federal to proposals experts’ with other Heritage Foundation interact that ects includes ef figure 10-year billion. This equal $27.287 comprehensive federal employee compensation reforms as detailed in Rachel Greszler and James Sherk, “Why It and James Sherk, “Why in Rachel Greszler as detailed reforms compensation employee federal comprehensive compound increases pay automatic time as workers’ over compound because the savings savings longer-term this proposal’s to compared experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume experts even though unfair-labor-practice complaints have fallen by 40 percent since FY 1990 and election petitions have fallen by an even larger larger an even by fallen have petitions FY 1990 and election since 40 percent by fallen have complaints unfair-labor-practice though even oad?fileId=%7BEA39AE2D-BF35-41B0-9FD4-5550A46947C6%7D&fileName=jobcorpsadmin.pdf&fileData=jobcorpsadmin.pdf%20-%20 2019). 2019). Heritage experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume Heritage experts 2019). (accessed April 6, 2019). Heritage experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume Heritage experts April 6, 2019). (accessed Peter Z. Schochet, Sheena McConnell, and John Burghardt, and John Burghardt, Sheena McConnell, Z. Schochet, Peter Estimated savings of $13.8 million for FY 2020 are based on the FY 2019 full-year spending level as reported in U.S. Department of Labor, of Labor, Department in U.S. as reported spending level full-year based on the FY 2019 are FY 2020 million for of $13.8 savings Estimated Savings of $1.719 billion for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. as specified in H.R. level appropriated on the FY 2019 based are 2020 FY billion for of $1.719 Savings Estimated savings of $376 million for FY 2020 are based on Heritage Foundation experts’ analysis of proposed of proposed analysis experts’ based on Heritage Foundation are FY 2020 million for of $376 savings Estimated Estimated savings of $268 million for FY 2020 are based on a GeneralSchedule.org statistic showing that 37,033 federal employees live live employees federal 37,033 that showing statistic based on a GeneralSchedule.org are FY 2020 million for of $268 savings Estimated Estimated savings of $59.8 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. 6157, Department of Defense of Defense Department 6157, as specified in H.R. level appropriated based on the FY 2019 are FY 2020 million for of $59.8 savings Estimated FederalPay.org, “General Schedule (GS) Locality Pay Map,” 2019, https://www.federalpay.org/gs/locality (accessed April 6, 2019). (accessed https://www.federalpay.org/gs/locality 2019, Map,” Pay Locality Schedule (GS) “General FederalPay.org, airs, “Mission,” https://www.dol.gov/agencies/ilab/about-us (accessed April 7, April 7, (accessed https://www.dol.gov/agencies/ilab/about-us “Mission,” airs, f Labor A of International Bureau of Labor, Department U.S. Estimated savings of $123 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. 6157, Department of Defense of Defense Department as specified in H.R. 6157, level appropriated based on the FY 2019 are FY 2020 million for of $123 savings Estimated Estimated savings of $741 million for FY 2020 are based on the FY 2019 full-year spending level as reported in U.S. Department of Labor, of Labor, Department in U.S. as reported spending level full-year based on the FY 2019 are FY 2020 million for of $741 savings Estimated U.S. Department of Labor, of Labor, Department U.S. Estimated savings of $103.5 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. 6157, Department of Department as specified in H.R. 6157, level appropriated based on the FY 2019 are FY 2020 million for of $103.5 savings Estimated Estimated savings of $10.5 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. 6157, Department of Defense Defense of Department as specified in H.R. 6157, level appropriated based on the FY 2019 are FY 2020 million for of $10.5 savings Estimated Estimated savings of $3.250 billion for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. 6157, Department of Department as specified in H.R. 6157, level appropriated FY 2019 based on the are FY 2020 for of $3.250 billion savings Estimated 2020 Department of Labor Budget in Brief Budget Labor of Department 2020 Act, 2019 and Continuing Appropriations Act, 2019, Public Law 115-245, 115th Cong., September 28, 2018, 28, 2018, September Cong., 115th 115-245, Public Law 2019, Act, Appropriations and Continuing 2019 Act,

8. 5. 6. 9. ENDNOTES 13. 14. 12. 11. 10. 1. 2. The Heritage Foundation | 3. 7. 4. LABOR/HHS 248 The Heritage Foundation | Foundation Heritage The 26. 25. 24. 23. 22. 21. 20. 19. 18. 17. 16. 15.

April 6,2019), andCongressional Budget Ofce, Estimated savings of$46.701 billionfor FY2020 are basedonHeritageFoundation experts’ analysis ofproposed comprehensive federal Estimated savings of $5.732 billionfor FY2020 are basedonHeritageFoundation experts’ analysis ofproposed comprehensive federal Reg Jones,“The SpecialRetirement Supplement,” FEDweek, January22,2018, Estimated savings of$113 millionfor FY2020 are basedontheCBO’s estimated first-year savings from eliminating thespecial James Sherk,“Inflated Federal Pay: How AmericansAre Overtaxed to Overpay theCivil Ibid. “This report isdesignedto provide information gathered by theBAM [BenefitAccuracy Measurement] program for Improper Payment Estimated savings of$742 millionfor FY2020 are basedona20percent reduction inthetotal overpayment level of$3.708 billion This proposal hasnosavings inFY2020 because thePBGCisnotataxpayer-financed entity, andadditionalfundswould beusedto This proposal hasnoestimated savings for FY2020 butwould likely generate significant savings over timeasitwould cause Authors’ calculations establish percent the6.34 ofpay cost by comparing theaverage salaryof$54,656 in2002 to theestimated $3,475 Estimated savings of $569 millionfor FY2020 are accrual-based savings, whichmeansthat theactual savings donotaccrue Estimated savings of$2.9 billioninFY2020 come from Congressional Budget Ofce, (accessed April 6,2019). Heritageexperts assume that the2017 overpayment level remains constant through FY2020. All$742 million 2016, p. 36,https://www.cbo.gov/sites/default/files/114th-congress-2015-2016/reports/52142-budgetoptions2.pdf (accessed opm.gov) andto reflect implementation in2020 asopposedto 2017 asassumed intheoriginalHeritageFoundation report andfigures. employee compensation reforms asdetailed inGreszler andSherk,“Why ItIsTime to Reform Compensation for Federal Employees.” competition andchoice underthisproposal by Heritageexperts) projected savings of$42 billionover 10years, or$4.2 compensation inlinewithprivate-sector compensation. of $71.554 billionover the2020–2029 period.This 10-year figure includesefects that interact withother HeritageFoundation experts’ opm.gov) andto reflect implementation in2020 asopposedto 2017 asassumed intheoriginalHeritageFoundation report andfigures. employee compensation reforms asdetailed inGreszler andSherk,“Why ItIsTime to Reform Compensation for Federal Employees.” efects that interact withotherHeritageFoundation experts’ proposals to bringfederal personnel compensation inlinewithprivate- sector compensation. Performance Year 2017 Congressional Budget Ofce, “The President’s Proposal to Accrue Retirement Costs for Federal Employees,” Savings for FY2020 have beenupdated to reflect themost recent, June2018 federal employment data available from FedScope (fedscope. Service,” HeritageFoundation as reported inU.S. Department ofLabor, accrual cost ofFEHBbenefitsasreported inCongressional Budget Ofce, “The President’s Proposal to Accrue Retirement Costs for Savings for FY2020 have beenupdated to reflect themost recent, June2018 federal employment data available from FedScope (fedscope. amounting to $5.3 billionover 10years. All$113 millioninsavings represents mandatory spending. represents mandatory savings. proposal for aflat FEHBcontribution alongsidelimited contribution growth (something that would come naturally through received. Savings estimates are basedonaCBO report that estimated thevalue ofFEHBbenefitsat 6.4 percent ofworkers’ pay. See proposals to bringfederal personnel compensation inlinewithprivate-sector compensation. not includeannualsavings estimates, soHeritageanalysts appliedtheoverall increase inreported savings of13percent (from atotal of retirement supplement asfound inCongressional Budget Ofce, retirement benefitaccruals. Since workers earnFERScredits eachyear butdonotactually receive benefitsuntil retirement, itmakes sense $4.7 billioninthe2016 report to $5.3 billioninthe2018 report) to eachyear’s previously reported savings. Savings would grow over time, $32.53 billion.This 10-year figure includesefects that interact withotherHeritageFoundation experts’ proposals to bringfederal personnel federal workers to desire lower-cost plansandwould increase competition among FEHBplans.ACBO analysis ofasimilar the probability that pensioners would receive more orallofwhat theirpensionplanspromised themandwhat thePBGCissupposedto to current statistics (June 2018) onthenumberandwages offederal employees. Total savings over the2020–2029 periodwould equal to thefederal government until thefuture years whenemployees donotreceive theFEHBbenefitsthey otherwisewould have the buyout optionfor federal employees to convert theiraccumulated FERSbenefitsto TSP contributions witha25percent reduction to list theaccrued savings that willoccur to thefederal government asaresult oflower retirement contribution rates. FY2020 savings Information Act (IPIA) performance year (PY) 2017.” Ibid., p. 1. Federal Employees.” Heritage Foundation experts estimate that thisreform would reduce federal employment by 2.2percent andgenerate total savings Retirement savings represent accrual-based savings: thelong-term savings generated by theimpact ofthepolicy changeon2020 insure. This proposal would alsoreduce the riskofataxpayer bailoutamounting to hundreds ofbillionsdollars. improve thesolvency ofthePBGCandmultiemployer pensionplansasopposedto reducing taxpayer costs. However, thiswould increase in actuarial value. Total accrual-based savings over the2020–2029 periodwould equal$206.253 billion.This 10-year figure includes include $13.802 billioninaccrual-based discretionary savings from permanent changesand$32.898 billioninone-timesavings from https://www.cbo.gov/sites/default/files/112th-congress-2011-2012/reports/03-10-reducingthedeficit.pdf (accessed April6,2019). billion peryear. SeeCongressional Budget Ofce, https://www.cbo.gov/sites/default/files/107th-congress-2001-2002/reports/accrual.pdf (accessed April6,2019). We applythisvalue http://www.fedweek.com/reg-jones-experts-view/special-retirement-supplement/ (accessed April6,2019). https://www.cbo.gov/system/files?file=2018-12/54667-budgetoptions.pdf (accessed April6,2019). The most recent 2018 report does http://www.heritage.org/research/reports/2010/07/inflated-federal-pay-how-americans-are-overtaxed-to-overpay-the-civil-service. , p. 10, https://oui.doleta.gov/unemploy/bam/2017/IPIA_2017_Benefit_Accuracy_Measurement_Annual_Report.pdf Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance Center for Data Analysis Report Benefit Accuracy Measurement State Data Summary: Improper Payment Information Act Options for Reducing theDeficit:2019 to 2028 Reducing theDeficit:SpendingandRevenue Options A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A No. CDA10-05, July7, 2010, Options for Reducing theDeficit:2017 to 2026 Options for Reducing theDeficit:2019–2028 , December 2018, p. 310, , March 2011, p. 37, CBO Paper , December , June2002, , p. 115. LABOR/HHS

249 , p. 95. 95. , p. , JCX-3-17, January 30, 2017, 2017, January 30, , JCX-3-17, , September 2015, p. 43, 43, p. 2015, , September No. 3162, November 16, 2016, 2016, 16, November 3162, No. Backgrounder Fiscal Year 2020 Budget of the U.S. Government: Government: the U.S. of Budget 2020 Year Fiscal Fiscal Year 2020 Budget of the U.S. Government: Major Government: the U.S. of Budget 2020 Year Fiscal Options for Reducing the Deficit: 2019 to 2028 to the Deficit: 2019 Reducing Options for Federal Housing Assistance for Low-Income Households Low-Income for Housing Assistance Federal A FEDERAL BUDGET FOR FISCAL YEAR 2020 Estimates of Federal Tax Expenditures for Fiscal Years 2016–2020 Years Fiscal for Expenditures Tax Federal of Estimates , p. 39, https://www.whitehouse.gov/wp-content/uploads/2019/03/msar-fy2020.pdf (accessed April 7, 2019). April 7, (accessed https://www.whitehouse.gov/wp-content/uploads/2019/03/msar-fy2020.pdf 39, , p. heritage.org/BlueprintForBalance Blueprint for Balance: , p. 50. , p. https://www.cbo.gov/sites/default/files/114th-congress-2015-2016/reports/50782-lowincomehousing-onecolumn.pdf (accessed April 6, (accessed https://www.cbo.gov/sites/default/files/114th-congress-2015-2016/reports/50782-lowincomehousing-onecolumn.pdf https://www.jct.gov/publications.html?func=startdown&id=4971 (accessed April 6, 2019). Not all taxpayers experienced the same increase the same increase experienced Not all taxpayers 6, 2019). April (accessed https://www.jct.gov/publications.html?func=startdown&id=4971 https://www.heritage.org/sites/default/files/2018-04/BG3162.pdf. This report provides estimated savings for FY 2015. Heritage experts experts Heritage FY 2015. for savings estimated provides report This https://www.heritage.org/sites/default/files/2018-04/BG3162.pdf. billion. Estimates come from Robert Rector and Jamie Bryan Hall, “Reforming the Earned Income Tax Credit and Additional Child Tax Child Tax and Additional Credit Tax the Earned Income Hall, “Reforming and Jamie Bryan Rector Robert from come billion. Estimates in the value of their child tax credit, however. Some low-income families may not receive a full doubling of the credit, and some higher- a full doubling of the credit, not receive may families Some low-income however. credit, of their child tax in the value lower- Although most in 2020. value the full $2,000 will receive before credit or no child tax only a partial received that families income estimate conservatively we value, credit tax a doubling of their child experience will this proposal by ected be af would that families income in 2019 and beyond (including a higher refundable portion) as a result of the Tax Cuts and Jobs Act. The Joint Committee on Taxation on Taxation Committee Joint The Jobs Act. Cuts and of the Tax portion) as a result higher refundable (including a and beyond in 2019 level based on a 10-year phaseout of the program. based on a 10-year level Defense and Labor, Health and Human Services, and Education Appropriations Act, 2019 and Continuing Appropriations Act, 2019. Heritage 2019. Act, Appropriations and Continuing 2019 Act, Appropriations and Education Health and Human Services, and Labor, Defense Health and Human Services, and Education Appropriations Act, 2019 and Continuing Appropriations Act, 2019. Heritage experts assume assume Heritage experts 2019. Act, Appropriations and Continuing 2019 Act, Appropriations and Education Health and Human Services, Heritage experts 2019. Act, Appropriations and Continuing 2019 Act, Appropriations and Education Health and Human Services, Labor, Projections, by Budget Account,” January 2019, https://www.cbo.gov/about/products/budget-economic-data#9 (accessed April (accessed https://www.cbo.gov/about/products/budget-economic-data#9 January 2019, Account,” Budget by Projections, FY 2017.” All $2.5 billion represents mandatory savings. mandatory All $2.5 billion represents FY 2017.” Payment Root Cause Category Matrix for FY 2017,” https://www.ssa.gov/improperpayments/SSI_majorCauses.html (accessed April 6, 2019). April 6, 2019). (accessed https://www.ssa.gov/improperpayments/SSI_majorCauses.html FY 2017,” for Matrix Cause Category Root Payment that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that that the child tax credit provisions in this proposal will increase the value of the credit for families by 60 percent, from $7.6 billion (as $7.6 from 60 percent, by families for of the credit the value will increase in this proposal provisions credit the child tax that the EITC and ACTC and an added cost of $3.3 billion per year for reducing marriage penalties in the EITC, for a net savings of $20.26 of $20.26 savings a net for marriage penalties in the EITC, reducing for of $3.3 per year billion and an added cost and ACTC the EITC that includes $3.542 billion due to “Inability to Access Data.” Heritage estimates that this proposal would reduce those overpayments by 15 15 by overpayments those reduce would this proposal that estimates Heritage Data.” Access to “Inability billion due to includes $3.542 that Improper Payments: Improper Major Causes of SSI Payments: Improper “Reducing Administration, See Social Security FY 2020. through 6, 2019). We propose a 10-year, phased-in elimination of federal housing programs excluding those for low-income disabled and disabled low-income those for excluding housing programs of federal phased-in elimination a 10-year, propose We 6, 2019). $440 million represents the first year of implementation. Over subsequent years, the savings would grow, eventually approaching $1 billion $1 approaching eventually grow, would the savings years, subsequent Over of implementation. year the first $440 million represents setting revenue of $392 million from mandatory HUD spending categories) as HUD spending categories) mandatory million from of $392 revenue ofsetting spending and a net billion in discretionary $47.601 per year in the 10th year. All $440 million represents mandatory savings. mandatory All $440 million represents in the 10th year. per year ect at the beginning of FY 2020 (October 2019). (October the beginning of FY 2020 at ect ef the option takes that assuming spending in FY 2020, mandatory the long run. over significantly outlays federal reduce likely would requirements ce, “The Budget and Economic Outlook: 2019 to 2029: Budget and Economic Data: Spending Data: and Economic Budget 2029: to Outlook: 2019 and Economic Budget “The Ofce, Budget in Congressional reported reported in the November 2016 Heritage report) to $12.2 billion in 2020. All $20.26 billion in savings represents mandatory spending. mandatory represents billion in savings All $20.26 billion in 2020. $12.2 to Heritage report) 2016 in the November reported percent in the first year, resulting in $531 million in savings in FY 2020. Heritage experts assume that FY 2017 overpayments remain constant constant remain overpayments FY 2017 that assume Heritage experts FY 2020. in million in savings in $531 resulting year, in the first percent assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume See Table 2, “Characteristics of Households Receiving Housing Choice Vouchers, Project-Based Rental Assistance, or Public Housing Assistance, Rental Project-Based Vouchers, Housing Choice of Households Receiving 2, “Characteristics See Table average overpayment rate of 0.44 percent, which is equal to the average overpayment rate for FY 2013–FY 2017 as found in Social Security in Social Security as found 2017 FY 2013–FY for rate overpayment the average which is equal to percent, of 0.44 rate overpayment average Credit to End Waste, Fraud, and Abuse and Strengthen Marriage,” Heritage Foundation Heritage Foundation Marriage,” and Abuse and Strengthen Fraud, End Waste, to Credit Major Savings and Reforms Major Savings experts assume that FY 2020 spending remains constant at FY 2019 levels. Savings equal 10 percent of the estimated FY 2020 spending FY 2020 of the estimated equal 10 percent Savings levels. FY 2019 at constant remains spending FY 2020 that assume experts elderly populations. According to the CBO, approximately 50 percent of housing assistance goes to elderly and disabled recipients. elderly and disabled recipients. goes to of housing assistance 50 percent approximately the CBO, to According elderly populations. conservatively assume a similar level of savings in FY 2020 with the exception of the savings from the child tax credit, which doubled credit, the child tax from of the savings with the exception in FY 2020 of savings a similar level assume conservatively on Committee See Joint in 2020. percent 126 by of the CTC the cost increased provisions credit tax child the TCJA’s that estimated 2019). Thus, savings of $2.360 billion for FY 2020 are based on reducing half of HUD’s budget by 10 percent. by budget half of HUD’s based on reducing are FY 2020 of $2.360 billion for savings Thus, 2019). 2018–2017,” JCX-67-17, December 18, 2017, https://www.jct.gov/publications.html?func=startdown&id=5053 (accessed April 6, 2019), and April 6, 2019), (accessed https://www.jct.gov/publications.html?func=startdown&id=5053 18, 2017, December JCX-67-17, 2018–2017,” Estimated savings of $531 million in FY 2020 are based on a Social Security Administration estimate of overpayments in the SSI program program in the SSI of overpayments estimate Administration Security based on a Social are in FY 2020 million of $531 savings Estimated Estimated savings of $2.5 billion for FY 2020 come from The Heritage Foundation’s Social Security Model. Savings are based on an based are Model. Savings Social Security Heritage Foundation’s The from come FY 2020 for of $2.5 billion savings Estimated in eligibility and limiting fraud reducing from in savings include $23.56 billion per year FY 2020 billion for of $20.26 savings Estimated ce. The The Ofce. Budget the Congressional from score based on an unpublished preliminary are FY 2020 of $440 million for savings Estimated Savings of $3.690 billion for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. 6157, Department of Defense and of Defense Department as specified in H.R. 6157, level appropriated based on the FY 2019 are FY 2020 for billion of $3.690 Savings Estimated savings of $1.006 billion for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. 6157, Department of Department as specified in H.R. 6157, level appropriated based on the FY 2019 are FY 2020 billion for of $1.006 savings Estimated U.S. Department of Agriculture, Food and Nutrition Service, Supplemental Nutrition Assistance Program, Guidance on Non-Citizen Eligibility, Eligibility, on Non-Citizen Guidance Program, Nutrition Assistance Supplemental and Nutrition Service, Food of Agriculture, Department U.S. ce of Management and Budget, and Budget, of Management based on Ofce are FY 2020 million for of $725 Savings Heritage experts do not include any savings for this proposal because the federal funding stream for TANF is fixed. However, stronger work work stronger However, is fixed. TANF for funding stream because the federal this proposal for savings do not include any Heritage experts Estimated savings of $2.360 billion in FY 2020 are based on net projected spending of $47.209 billion for FY 2020 (including FY 2020 billion for spending of $47.209 projected based on net are of $2.360 billion in FY 2020 savings Estimated ce of Management and Budget, and Budget, of Management based on Ofce are FY 2020 of $3.3 billion for Savings Savings of $1.77 billion for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. 6157, Department of Defense and Labor, and Labor, of Defense Department in H.R. 6157, as specified level appropriated based on the FY 2019 are FY 2020 billion for of $1.77 Savings ce, Ofce, Budget Congressional from come billion in FY 2020 of $11 savings Estimated Savings and Reforms Savings ce, Ofce, Budget in Congressional 2013,” Assistance, Administration, “Reducing Improper Payments: Major Causes of SSI Improper Payments: Improper Payment Root Cause Category Matrix for for Matrix Category Cause Root Payment Improper Payments: Improper Major Causes of SSI Payments: Improper “Reducing Administration, All $531 million represents mandatory savings. mandatory represents million All $531 The option to “eliminate Supplemental Security Benefits for Disabled Children” includes $1 billion in discretionary spending and $10 billion in and $10 spending billion in discretionary includes $1 Disabled Children” Benefits for Security Supplemental “eliminate option to The ects of the Conference Agreement for H.R.1, The ‘Tax Cuts and Jobs Act,’ Fiscal Years Fiscal Years Cuts and Jobs Act,’ ‘Tax The H.R.1, for Agreement of the Conference ects f E Budget “Estimated Congress, U.S. Taxation, June 2011, p. 47, https://fns-prod.azureedge.net/sites/default/files/snap/Non-Citizen_Guidance_063011.pdf (accessed April 7, 2019). April 7, (accessed https://fns-prod.azureedge.net/sites/default/files/snap/Non-Citizen_Guidance_063011.pdf 47, p. June 2011, Joint Committee on Taxation, U.S. Congress, Congress, U.S. on Taxation, Committee Joint

29. 28. 27. The Heritage Foundation | 38. 39. 36. 37. 35. 34. 32. 33. 31. 30. LABOR/HHS 47. 46. 45. 44. 43. 42. 41. 40. 49. 48. 250 58. 57. 56. 55. 54. 53. 52. 51. 50. | Foundation Heritage The

April 2017, p. 17, https://www.gao.gov/assets/690/684314.pdf (accessed April8,2019). Government: MajorSavings andReforms Government: MajorSavings andReforms Government: MajorSavings and Reforms Government: MajorSavings and Reforms Government: MajorSavings andReforms Estimated savings of$360millionfor FY2020 are basedonOfce ofManagement andBudget, U.S. Department ofEducation, Student SupportandAcademic Enrichment Program, “Program Description,” Estimated savings of$1.17 billionfor FY2020 are basedonOfce ofManagement andBudget, U.S. Department ofEducation, Ofce ofElementary andSecondary Education, EDTASS: Striving Readers Estimated savings of$190 millionfor FY2020 are basedonOfce ofManagement andBudget, U.S. Department ofEducation, Institute ofEducation Sciences, National Center for Educational Evaluation andRegional Assistance, When U.S. Government Accountability Ofce, K–12 Education: Education Needsto Improve Oversight ofIts21st Century Program, GAO-17-400, Estimated savings of $1.2 billionfor FY2020 are basedonOfce ofManagement andBudget, Estimated savings of$840millionfor FY2020 are basedonOfce ofManagement andBudget, Estimated savings of $700 millionfor FY2020 come from Congressional Budget Ofce, Optionsfor Reducing theDeficit:2019–2028, Heritage experts donotinclude any estimated savings for thisproposal becauseitsfiscalimpact would dependonarange ofbehavioral Congressional Budget Ofce, “H.R.4508, Promoting Real Opportunity, Success, andProsperity Through Education Reform Act, asOrdered Estimated savings of–$1.2 billion(inotherwords, anadditionalcost of$1.2 billion)for FY2020 are basedonHeritageexperts’ estimates as Estimated savings of$8.836billionfor FY2020 are basedonFY2019 grant levels undertheEvery Student Succeeds Act as Estimated savings of $370 millionfor FY2020 are basedonCongressional Budget Estimated savings of $7.291 billionfor FY2020 are basedon the CBO’s most recent January2019 baselinespending Estimated savings of $5.5 billionfor FY2020 are basedonHeritageexperts’ estimates asreported inHallandReim, “Time to Reform Higher Estimated savings billionfor of$2.3 FY2020 are based onHeritageexperts’ estimates asreported inHallandReim, “Time to Reform Higher H.R. 4274, HigherEducation Reform and Opportunity Act of2017, 115thCong., introduced November 7, 2017, (accessed April8,2019). 2019). The CBO includes$370 millioninFY2019 savings from “Eliminat[ing] Service Public Loan Forgiveness.” Italsoassumes that FY2019 Issue Brief could leadto savings by increasing competition anddrivingdown college costs. Comprehensive Literacy (SRCL), Ofce, “Proposals for Education—CBO’s Estimate ofthePresident’s FiscalYear 2019 Budget,” Schools Stay OpenLate: The National Evaluation ofthe21st Century Community Learning Centers Program: FinalReport, April2005, p. xii, and Opportunity Act of2017, 115thCong., introduced December 13,2017, https://www.congress.gov/bill/115th-congress/senate-bill/2228 accurate measure offederal loans’truecosts.) Implementing thisproposal inconjunction withtheproposals to place strict lendingcapson a widerrange ofeducation options.(Additional loanscost thefederal government money becausewe usefair-value accounting, amore responses from botheducational institutions andstudents that cannotreasonably bepredicted. mandatory spending. p. 115. Heritageusesthe“fair-value method” ofaccounting asthisisamore accurate method. All$700 millioninsavings represents projections for mandatory student financialassistance asreported inCongressional Budget Ofce, “The Budget and reported inJamieBryan HallandMaryClare Reim, “Time to Reform HigherEducation FinancingandAccreditation,” HeritageFoundation reduction inTitle IandTitle VIIspending($1.794 billion). most non-Title I,non-Title VI,andnon-Title VIIfundsundertheElementary andSecondary Education Act ($7.042 billion)anda10percent reported inU.S. Department ofEducation, “Department ofEducation FiscalYear 2019 Congressional Action,” October 9, 2018, federal student aidprograms andeliminate thePLUS Loan program would mitigate itscosts intheshortrun.Inlongrun,thisproposal time, asmore borrowers would nolongerbeeligiblefor forgiveness. (The CBO score assumes that thepolicy appliesto new borrowers after Reported by theHouseCommittee onEducation andtheWorkforce onDecember 13,2017,” Cost Estimate, February 6,2018, pp. 7and17, Economic Outlook:2019 to 2029: Budget andEconomic Data: SpendingProjections, by Budget Account,” January2019, Education FinancingandAccreditation.” Education FinancingandAccreditation.” implementation oftheproposal.) is thefirst year ofimplementation, soHeritageexperts applytheFY2019 savings level to FY2020. Savings would increase significantly over in thenext year includesitsefects onincreasing total Pell Grants andfederal student loansby makingthemaccessible to students across https://www2.ed.gov/programs/ssae/index.html (accessed April9, 2019). https://www2.ed.gov/programs/strivingreaders-literacy/performance.html (accessed April7, 2019). https://www2.ed.gov/rschstat/eval/other/cclcfinalreport/cclcfinal.pdf (accessed April8,2019). https://www.cbo.gov/system/files/115th-congress-2017-2018/costestimate/hr4508.pdf (accessed April8,2019). https://www.cbo.gov/system/files?file=115th-congress-2017-2018/dataandtechnicalinformation/53901-education.pdf (accessed April7, https://www.cbo.gov/about/products/budget-economic-data#9 (accessed April6,2019). All$7.291 billionrepresents mandatory savings. https://www.congress.gov/bill/115th-congress/house-bill/4274/all-info (accessed April8,2019), andS.2228,HigherEducation Reform https://www2.ed.gov/about/overview/budget/budget19/19action.pdf (accessed April7, 2019). This includeselimination ofspendingon No. 4668,March 28,2017, https://www.heritage.org/sites/default/files/2017-03/IB4668.pdf. The estimated cost ofthisproposal Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance 5.2—National Performance Report: 2014–15 , p. 31. , p. 25. , p. 22. , p. 21. , p. 20. A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A , September 2016, p. ix, Fiscal Year 2020 Budget of theU.S. Fiscal Year 2020 Budget of the U.S. Fiscal Year 2020 Budget of theU.S. Fiscal Year 2020 Budget of theU.S. Fiscal Year 2020 Budget of theU.S. LABOR/HHS

251 , p. 2, , p. , p. F-7, F-7, , p. No. 165, 165, No. , ed. Susan E. Mayer Mayer , ed. Susan E. Putting America’s Health First: FY 2020 FY 2020 Health First: Putting America’s Fiscal Year 2020 Budget of the U.S. the U.S. of Budget 2020 Year Fiscal Legal Memorandum Legal Fiscal Year 2020 Budget of the U.S. Government: Government: the U.S. of Budget 2020 Year Fiscal , p. 86. All $1.4 billion represents mandatory savings. The CBO CBO The savings. mandatory billion represents 86. All $1.4 , p. Earning and Learning: How Schools Matter Schools How and Learning: Earning Innovation and Improvement, Fiscal Year 2020 Budget Request Budget 2020 Year Fiscal and Improvement, Innovation , October 2018, pp. 18 and 22, https://www.cafonline.org/docs/default-source/about- pp. 2018, , October A FEDERAL BUDGET FOR FISCAL YEAR 2020 , p. 32. , p. Corporation for Public Broadcasting Appropriation Request and Justification FY 2019 and FY 2021 FY 2019 Justification and Request Appropriation Public Broadcasting for Corporation Options for Reducing the Deficit: 2019 to 2028 to the Deficit: 2019 Reducing Options for , p. 86, https://www.hhs.gov/sites/default/files/fy-2020-budget-in-brief.pdf (accessed April 7, 2019). April 7, (accessed 86, https://www.hhs.gov/sites/default/files/fy-2020-budget-in-brief.pdf , p. , p. 33, and $200 million from eliminating Teacher and School Leader Incentive Grants, for which for Grants, Incentive and School Leader Teacher eliminating million from 33, and $200 , p. CAF World Giving Index 2018 Giving Index World CAF heritage.org/BlueprintForBalance Blueprint for Balance: by Budget Account,” January 2019, https://www.cbo.gov/about/products/budget-economic-data#9 (accessed April 6, 2019). The CBO CBO The April 6, 2019). (accessed https://www.cbo.gov/about/products/budget-economic-data#9 January 2019, Account,” Budget by http://dailysignal.com/2016/05/13/obama-unilaterally-rewrites-law-imposes-transgender-policy-on-nations-schools/. http://dailysignal.com/2017/02/22/trump-right-to-fix-obamas-unlawful-transgender-school-policies/. https://www.cpb.org/files/appropriation/justification-FY19-and-FY21.pdf (accessed April 7, 2019). April 7, (accessed https://www.cpb.org/files/appropriation/justification-FY19-and-FY21.pdf 2019). April 7, (accessed http://www.npr.org/about-npr/178660742/public-radio-finances https://www2.ed.gov/about/overview/budget/budget20/justifications/f-ii.pdf (accessed April 7, 2019). April 7, (accessed https://www2.ed.gov/about/overview/budget/budget20/justifications/f-ii.pdf http://hanushek.stanford.edu/sites/default/files/publications/Hanushek%201999%20EvidenceonCLassSize.pdf (accessed April 7, 2019). April 7, (accessed http://hanushek.stanford.edu/sites/default/files/publications/Hanushek%201999%20EvidenceonCLassSize.pdf ce, “The Budget and Economic Outlook: 2019 to 2029: Budget and Economic Data: Spending Projections, Spending Projections, Data: and Economic Budget 2029: to Outlook: 2019 and Economic Budget “The Ofce, Budget in Congressional FY 2019. All $115.864 billion in savings represents mandatory spending. mandatory represents billion in savings All $115.864 FY 2019. mandatory billion in total $409.9 in an estimated result it would in FY 2020, savings does not generate Health Model. Although this policy Defense and Labor, Health and Human Services, and Education Appropriations Act, 2019 and Continuing Appropriations Act, 2019. Heritage 2019. Act, Appropriations and Continuing 2019 Act, Appropriations and Education Health and Human Services, and Labor, Defense Defense and Labor, Health and Human Services, and Education Appropriations Act, 2019 and Continuing Appropriations Act, 2019. Heritage 2019. Act, Appropriations and Continuing 2019 Act, Appropriations and Education Health and Human Services, and Labor, Defense us-publications/caf_wgi2018_report_webnopw_2379a_261018.pdf?sfvrsn=c28e9140_4 (accessed April 7, 2019). April 7, (accessed us-publications/caf_wgi2018_report_webnopw_2379a_261018.pdf?sfvrsn=c28e9140_4 for graduate medical education at teaching hospitals. Policies of establishing a discretionary grant program with growth limited either to either to limited with growth program grant a discretionary of establishing hospitals. Policies teaching at medical education graduate for $200 million is requested in U.S. Department of Education, of Education, Department U.S. in $200 million is requested projects $130 million in spending for FY 2020, and this proposal reduces that amount by 50 percent. by amount that reduces proposal and this FY 2020, million in spending for $130 projects Signal, September 8, 2017, http://dailysignal.com/2017/09/08/betsy-devos-stands-due-process-rights-campus-sexual-assault-cases/. 8, 2017, Signal, September and Labor, Health and Human Services, and Education Appropriations Act, 2019 and Continuing Appropriations Act, 2019. Heritage experts Heritage experts 2019. Act, Appropriations and Continuing 2019 Act, Appropriations and Education Health and Human Services, and Labor, in FY 2020. constant spending remains FY 2019 that assume assume that FY 2019 spending remains constant for FY 2020. for constant remains spending FY 2019 that assume ce of Management and Budget, Budget, and of Management based on Ofce Partnerships, Quality and Teacher experts Heritage 2019. Act, Appropriations and Continuing 2019 Act, Appropriations and Education Health and Human Services, and Labor, and Paul E. Peterson (Washington: Brookings Institution Press, and New York: Russell Sage Foundation, 1999), p. 132, 132, 1999), p. Sage Foundation, Russell York: and New Press, Institution Brookings (Washington: E. Peterson and Paul ce, Ofce, Budget Congressional October 6, 2015, http://www.heritage.org/education/report/campus-judiciaries-trial-update-the-courts. 6, 2015, October President’s Budget for HHS for Budget President’s Major Savings and Reforms Major Savings savings over the FY 2020–FY 2029 period, and these savings are included in the recommended mandatory entitlement spending levels. entitlement mandatory included in the recommended are period, and these savings 2029 the FY 2020–FY over savings estimates 10-year savings totaling $34 billion–$39.5 billion. $34 billion–$39.5 totaling savings 10-year estimates estimates from the CPI-U or to estimates from the CPI-U minus one percentage point would produce $1.4 billion in savings in FY 2020. See in FY 2020. billion in savings $1.4 produce would point CPI-U minus one percentage the from estimates the CPI-U or to from estimates experts assume that FY 2019 spending is reduced by 20 percent. 20 by spending is reduced FY 2019 that assume experts experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume experts 2019). Ryan T. Anderson, “Trump Right to Fix Obama’s Unlawful Transgender School Policy,” The Daily Signal, February 22, 2017, 22, 2017, Daily Signal, February The School Policy,” Transgender Unlawful Fix Obama’s to Right “Trump Anderson, T. Ryan Estimated savings of $1.4 billion for FY 2020 are based on a CBO score of a policy that would consolidate and reduce federal payments payments federal and reduce consolidate would that of a policy score based on a CBO are FY 2020 billion for of $1.4 savings Estimated of Health and Human Services, Department based on U.S. are of $0 in FY 2020 savings Estimated Hans von Spakovsky and Elizabeth Slattery, “Betsy DeVos Stands Up for Due Process Rights in Campus Sexual Assault Cases,” The Daily The Cases,” Assault in Campus Sexual Rights Due Process Up for Stands DeVos “Betsy Slattery, and Elizabeth Spakovsky Hans von Analysis Data for f using the Heritage Center sta Heritage Foundation from based on estimates are of $0 in FY 2020 savings Estimated Ryan T. Anderson, “Obama Unilaterally Rewrites Law, Imposes Transgender Policy on Nation’s Schools,” The Daily Signal, May 13, 2016, 13, 2016, Daily Signal, May The Schools,” on Nation’s Policy Imposes Transgender Law, Rewrites Unilaterally “Obama Anderson, T. Ryan Heritage Foundation Courts,” the from An Update on Trial: Judiciaries Samantha Harris, “Campus Estimated savings of $208.7 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. 6157, Department of Department as specified in H.R. 6157, level appropriated based on the FY 2019 are FY 2020 million for of $208.7 savings Estimated using the Heritage Center for Data Data for f using the Heritage Center sta Foundation Heritage from based on estimates are 2020 FY billion for of $115.864 savings Estimated Estimated savings of $65 million for FY 2020 are based on the CBO’s most recent January 2019 baseline spending projections as reported as reported baseline spending projections January 2019 recent most on the CBO’s based are FY 2020 million for of $65 savings Estimated Charities Aid Foundation, Charities Aid Foundation, Corporation for Public Broadcasting, Public Broadcasting, for Corporation Revenues,” Member Station “Public Radio Finances: Public Radio, in National (FY 2017),” Revenues Chart, “Public Station Radio ective Educator Development Development Educator ective f E the Supporting eliminating from million include $118 FY 2020 for of $318 million savings Estimated Defense of Department as specified in H.R. 6157, level appropriated based on the FY 2019 are FY 2020 million for of $445 savings Estimated Erik A. Hanushek, “The Evidence on Class Size,” Chapter 7 in Chapter Size,” on Class Evidence “The Erik A. Hanushek, Estimated savings of $242 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. 6157, Department of Defense of Defense Department 6157, as specified in H.R. level appropriated based on the FY 2019 are 2020 FY million for of $242 savings Estimated Plan 2018–2022,” Strategic Services of Museum and Library Institute Communities: “Transforming Services, of Museum and Library Institute Estimated savings of $786.7 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.R. 6157, Department of Department as specified in H.R. 6157, level appropriated 2019 based on the FY are FY 2020 for million of $786.7 savings Estimated Ibid. ce of Management and Budget, and Budget, of Management ce based on Of are FY 2020 for billion of $2.056 savings Estimated Government: Major Savings and Reforms Major Savings Government: Analysis Health Model, as estimated in 2018 for FY 2019. Heritage experts assume that FY 2020 savings remain the same as estimated for for the same as estimated remain savings FY 2020 that assume Heritage experts FY 2019. for in 2018 Health Model, as estimated Analysis January 2018, p. 9, https://www.imls.gov/sites/default/files/publications/documents/imls-strategic-plan-2018-2022.pdf (accessed April 7, April 7, (accessed https://www.imls.gov/sites/default/files/publications/documents/imls-strategic-plan-2018-2022.pdf 9, p. January 2018,

59. 69. 68. 66. 67. 65. 63. 64. 62. 60. 61. The Heritage Foundation | 79. 78. 77. 76. 74. 75. 72. 73. 70. 71. LABOR/HHS 252 The Heritage Foundation | Foundation Heritage The 84. 83. 82. 81. 80.

“Welfare Reform andUpward Mobility Act CanRestart Welfare Reform,” HeritageFoundation No. 4619, October 28,2016, Jonathan Butcher, “Giving Every ChildinaMilitaryFamily theChance for aBright Future: Education Savings Accounts, Trump Administration,” HeritageFoundation April 3,2018, https://www.heritage.org/education/commentary/military-families-deserve-education-choice-response-carol-burris; See Lindsey M.Burke, “MilitaryFamilies Deserve Education Choice: AResponse to Carol Burris,” HeritageFoundation U.S. Conference ofCatholic Bishops,Secretariat ofPro-Life Activities, “HHSRefuses to Enforce Weldon Amendment,” June24, 2016, http:// Melanie Israel, “The Pro-Life Agenda: AProgress Report for the115thCongress andthe For additionaldetail, seeRobert Rector andRachelShefeld,“Setting Prioritiesfor Welfare Reform,” Heritage Foundation Table 6C,“Work-Eligible IndividualswithHours ofParticipation by Work Activity asaPercent oftheTotal NumberofWork-Eligible Issue Brief Brief Ofce ofFamily Assistance, “Work Participation Rates—Fiscal Year 2017, Temporary Assistance for NeedyFamilies (TANF) andSeparate and AnneRyland, SHEET.pdf (accessed April7, 2019). www.usccb.org/issues-and-action/religious-liberty/conscience-protection/upload/HHS-Refuses-to-Enforce-Weldon-Amendment-FACT- State Programs–Maintenance ofEfort (SSP–MOE) Work Participation Rates andEngagement inWork Activities, FiscalYear (FY)2017,” the Profession published June26, 2018, https://www.acf.hhs.gov/sites/default/files/ofa/wpr2017table06c.pdf (accessed April7, 2019). Impact Aid,andEstimated FiscalImpacts onDistrict Schools,” HeritageFoundation Individuals, Monthly Average, FiscalYear 2017,” inU.S. Department ofHealthandHumanServices, Administration for Children andFamilies, Lindsey-M-Burke-and-Anne-Ryland-1.pdf (accessed April7, 2019). Program: APath Toward Educational Freedom for MilitaryFamilies andOtherFederally Connected Children,” HeritageFoundation Military Families: Transforming Impact Aidinto Education Savings Accounts,” HeritageFoundation https://www.heritage.org/sites/default/files/2017-10/BG3180.pdf; Lindsey M.Burke andAnneRyland,“ModernizingtheFederal Impact Aid https://www.heritage.org/sites/default/files/2018-03/IB4824_0.pdf; Lindsey M.Burke andAnneRyland,“A GIBillfor Children of https://www.heritage.org/civil-society/report/the-pro-life-agenda-progress-report-the-115th-congress-and-the-trump. http://thf-reports.s3.amazonaws.com/2016/IB4619.pdf. No. 4751, August 10, 2017, https://www.heritage.org/sites/default/files/2017-08/IB4751_0.pdf; andPaul DiPerna, Lindsey M.Burke, No. 4520, February 24, 2016, http://thf-reports.s3.amazonaws.com/2016/IB4520.pdf, andRachelShefeld, , EdChoice, October 2017, https://www.edchoice.org/wp-content/uploads/2017/10/Surveying-The-Military-by-Paul-DiPerna- Surveying theMilitary: What America’s Servicemembers, Veterans, andTheir Spouses Think AboutK–12 Education and Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance Backgrounder A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A No. 3280, January24, 2018, Issue Brief No. 4824, March 5, 2018, Backgrounder No. 3180, June2,2017, Commentary, Issue Legislative Branch The Heritage Foundation | heritage.org/BlueprintForBalance $1.4 DISCRETIONARY SAVINGS IN MILLIONS1

Eliminate Funding for the Stennis Center for Public Service Leadership The Stennis Center is a legislative program intended Numerous private entities provide services similar as a living tribute to the career of Senator John to those provided by the Stennis Center and can ful- Stennis (D–MS). It aims to attract young people to ﬁll the Center’s goals. The Young Leaders Program careers in public service, promote leadership skills, at The Heritage Foundation is just one example. and provide training and development opportuni- Past budgets and appropriations bills have called ties to Members of Congress, congressional staf, for elimination of the Stennis Center, and Congress and others in public service. should act on this modest recommendation now.

ADDITIONAL READING " Justin Bogie, Frederico Bartels, Nicolas D. Loris, and Katie Tubb, “Appropriations ‘Mini-bus’ Makes Progress in Some Areas, Misses the Mark in Others,” Heritage Foundation Issue Brief No. 4740, July 25, 2017.

LEG. BRANCH LEG.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at FY 2019 levels.

254 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $94.3 DISCRETIONARY SAVINGS IN MILLIONS2

Eliminate Funding for Congressional Subsidies for the Afordable Care Act’s Health Insurance Exchange Under Section 1312 (d)(3)(D) of the Afordable Care longer enrolled in the FEHBP—could continue to Act (ACA), Congress voted in 2010 to end its partic- receive the employer contribution for coverage in ipation in the Federal Employees Health Beneﬁts the exchange. The Obama Administration took this Program (FEHBP) and instead required Members regulatory action without statutory authority under and staf to obtain their health coverage through either the ACA or Title 5 of the U.S. Code, the law the ACA’s health insurance exchange.3 This change that governs the FEHBP.4 meant that Members and staf not only would no longer beneﬁt from their employer coverage, but Because the 2013 OPM ruling was an administra- also would no longer receive the employer contri- tive action, President Donald Trump could reverse bution toward the cost of their health insurance. On the OPM decision administratively. If President August 7, 2013, the Ofce of Personnel Management Trump does not act, Congress should restore the (OPM) reversed this change, ruling that Members original intent of the statute and end this special of Congress and staf—even though they are no taxpayer subsidy.

ADDITIONAL READING " Robert E. Moft, “How Congress Mysteriously Became a ‘Small Business’ for Obamacare Subsidies,” The Daily Signal, May 11, 2016. " Robert E. Moft, “Congress and Obamacare: A Big Double Standard,” The Daily Signal, November 17, 2013. " Robert E. Moft, Edmund F. Haislmaier, and Joseph A. Morris, “Congress in the Obamacare Trap: No Easy Escape,” Heritage Foundation Backgrounder No. 2831, August 2, 2013. LEG. BRANCH

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 255 LEG. BRANCH 256 4. 3. The Heritage Foundation | Foundation Heritage The 2. 1. ENDNOTES

Trap: NoEasy Escape,” HeritageFoundation 7, 2013, http://dailysignal.com//2013/08/07/administration-disregards-the-law-and-gives-special-obamacare-deal-to-congress/, Act, 2019 andContinuing Appropriations Act, 2019, Law Public 115-245, 115thCong., September 28,2018, Edmund Haislmaier, “Administration Disregards theLaw andGives SpecialObamacare Dealto Congress,” The DailySignal,August Robert E.Moft,Edmund F. Haislmaier, andJosephA.Morris,“Congress intheObamacare Estimated savings of$1.4 millionfor FY2020 are basedontheFY2019 appropriated level asspeciﬁedin Savings of$94.3 millionfor FY2020 includethefollowing data, assumptions, andcalculations. The D.C. HealthInsurance Exchange (accessed March 13,2019). For individuals,Heritageexperts usethereported premium cost of$3,938 for agoldplanfor a27-year-old 2019, Law Public 115-244, 115thCong., September 21,2018, https://www.congress.gov/bill/115th-congress/house-bill/5895/text (accessed year, Heritage experts conservatively assume that costs holdsteady inFY2020. experts assume that 50percent ofthe11,000 employees whoreceive thesubsidyhave self-only coverage, 50percent have family coverage, and upto $1 millionintransfers from Navy operations andmaintenance. and Robert Moft,“Congress andObamacare: ABigDoubleStandard,” The DailySignal, November 17, 2013, and theFEHBPsubsidycovers 75 percent ofemployees’ premiums. Althoughexchange healthinsurance costs have risensigniﬁcantly each age ofcongressional sta f is31intheHouseand32 intheSenate. LegiStorm, “Congress by theNumbers: 116thCongress (2019–2021),” purchased inthesmall-business exchange. This cost likely understates theactual premium cost for congressional staf ers becausethey provides average premium costs for 2019. D.C. Government, Department ofInsurance, 2019 Securities “Sample andBanking, Approved reports that asofearly2017, “about 11,000” congressional members andsta f were usingtheexchange for coverage. Louise Premiums Compared to 2018,” September 17, 2018, https://disb.dc.gov/publication/sample-2019-approved-premiums-compared-2018 Norris, “DCHealthInsurance Marketplace: History andNews of theState’s Exchange,” healthinsurance.org, February 15, 2019, March 13,2019). Heritageexperts assume that FY2019 spendingremains constant inFY2020. Savings include$430,000 indirect spending March 13,2019), andH.R.5895, Energy andWater, Legislative Branch, andMilitaryConstruction andVeterans Afairs Appropriations Act, H.R. 6157, Department ofDefense andLabor, HealthandHumanServices, andEducation Appropriations http://www.heritage.org/research/reports/2013/08/congress-in-the-obamacare-trap-no-easy-escape. https://www.dailysignal.com/2013/11/17/congress-and-obamacare-a-big-double-standard/. business exchange, soHeritageexperts usetheaverage goldfamily premium of$18,920 from theindividualmarket exchange. Heritage have anaverage agebetween 31and32, andpremium costs increase withage. Noaverage family premiums are reported for thesmall- https://www.legistorm.com/congress_by_numbers/index/by/senate.html (accessed March 12,2019). The D.C. HealthInsurance Exchange https://www.healthinsurance.org/dc-state-health-insurance-exchange/ (accessed March 13,2019). LegiStorm reports that theaverage https://www.congress.gov/bill/115th-congress/house-bill/6157?q=%7B%22search%22%3A%5B%22pl+115-245%22%5D%7D&r=1 (accessed Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance Backgrounder A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A No. 2831,August 2,2013, Military Construction, Veterans Afairs, and Related Agencies The Heritage Foundation | heritage.org/BlueprintForBalance $2 MANDATORY SAVINGS IN MILLIONS1

Cap GI Bill Flight Training Beneﬁts

The Department of Veterans Afairs provides exceed the private tuition value limit. While there educational benefits to veterans under the GI Bill. is nothing objectionable about veterans studying Veterans can choose to attend public or private uni- flight training, there is also no reason for the federal versities, and the VA pays the school for tuition and government to provide a larger subsidy for one fees. To prevent abuse of the program, the benefit subject (flight training) at one type of school than it value is capped for private institutions ($22,805 for provides for other subjects at other types of schools. the 2017–2018 academic year), and for public universities, the limit is the in-state tuition cost. This option would place a cap on the subsidy for public school flight training tuition equal to the cap Typically, in-state public tuition is less than the on private school tuition. According to the Congres- private university cap. However, tuition for pro- sional Budget Ofce, this would save $2 million in grams in flight training at public schools can the first year and $137 million over 10 years.2

MILCONVA

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

258 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $7.9 MIXED SAVINGS IN BILLIONS3

End Enrollment in VA Medical Care for Veterans in Priority Groups 7 and 8 The Department of Veterans Afairs should focus and disability status. Veterans in Priority Groups on the unique needs of military medicine. A 2014 (PGs) 7 and 8 do not have compensable service-con- Congressional Research Service study revealed nected disabilities, and their incomes tend to that more than one of every 10 VA patients is not a exceed the VA’s national income and geographic veteran, and the number of non-veterans using VA income thresholds. health care services has increased faster in recent years than has the number of veteran patients.4 VA According to the Congressional Budget Ofce, resources should be used solely to provide health almost 90 percent of enrollees in PGs 7 and 8 had care to veterans. other health care coverage in 2017.5 The Depart- ment of Veterans Afairs should not be providing The VA ranks veterans who seek medical care on benefits for veterans in PGs 7 and 8. Scarce VA a scale of one to eight, with the lower numbers health care dollars should be spent first on veterans being assigned the highest priority. The groups with the most severe disabilities. are defined according to such factors as income

ADDITIONAL READING " Justin Bogie, “Congress Should Exercise Restraint in Veterans Afairs Funding Bill,” Heritage Foundation Issue Brief No. 4548, May 17, 2016. " John S. O’Shea, “Reforming Veterans Health Care: Now and for the Future,” Heritage Foundation Issue Brief No. 4585, June 24, 2016. MILCONVA

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 259 The Heritage Foundation | heritage.org/BlueprintForBalance $1.0 MANDATORY SAVINGS IN BILLIONS6

Put a 10-Year Time Limit on Initial Applications for Disability Compensation for Veterans Currently, military veterans may file for service-re- Conditions such as tinnitus and moderate hearing lated disability benefits no matter how long ago loss are present in many disability applications. It is their service ended. First-time applicants at or impossible to distinguish between hearing damage close to retirement age may file for and receive caused by proximity to gunfire and explosions in benefits even if they left the military decades ago. the military and hearing damage caused by aging, Such applicants represent a significant portion of work environment, and leisure activity post-service. new enrollees. As of 2012, 43 percent of first-time Similarly, determining the primary cause of muscu- disability recipients were over the age of 55 despite loskeletal conditions can be nearly impossible after average tours of duty ending by age 30. enough time has passed.

Allowing for long-term efects of service injuries to Ofering veterans a 10-year window to apply for dis- manifest themselves is necessary and proper. How- ability compensation would provide sufcient time ever, after a certain point, this policy runs the risk of for long-term efects from service to become appar- causing the military disability system to cover con- ent while also reducing the potential for dubious ditions that were primarily the result of post-service claims. Such a reform would be in line with changes activity or the natural aging process. implemented in the United Kingdom and would save $1 billion in FY 2020 and $19 billion between FY 2020 and FY 2029.

ADDITIONAL READING " Congressional Budget Ofce, Veterans’ Disability Compensation: Trends and Policy Options, August 2014.

MILCONVA

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

260 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $9.0 MANDATORY SAVINGS IN BILLIONS7

Eliminate Concurrent Receipt of Retirement Pay and Disability Compensation for Veterans Until 2003, military retirees were prohibited from 33 percent in 2005 to just over 50 percent in 2015.8 collecting full Defense Department retirement In FY 2013, more than 2,300 veterans received and VA disability benefits simultaneously. Military $100,000 or more each in annual benefits, with the retirees eligible for VA disability benefits lost $1 in highest annual benefit amounting to more than Defense Department retirement benefits for every $200,000.9 $1 in VA disability benefits they collected. The rationale for this ofset policy was that concurrent The U.S. government should honor its promise to receipt of retirement and disability payments was the men and women who serve without generating compensating veterans for the same service twice. excessive benefit payouts. Simply returning to the long-standing pre-2004 policy under which vet- Policy changes instituted in 2004 allowed Defense erans’ disability payments ofset retirement pay Department retirees to collect benefits from both would reduce excessive benefits and save taxpayers programs simultaneously. Under this concur- $9 billion in FY 2020 and $139 billion between FY rent-receipt policy, the share of military retirees 2020 and FY 2029. who also receive VA disability benefits rose from

ADDITIONAL READING " Romina Boccia, “Triple-Dipping: Thousands of Veterans Receive More than $100,000 in Beneﬁts Every Year,” Heritage Foundation Issue Brief No. 4295, November 6, 2014. MILCONVA

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 261 The Heritage Foundation | heritage.org/BlueprintForBalance $2.4 MANDATORY SAVINGS IN BILLIONS9

Narrow Eligibility for Veterans Disability by Excluding Disabilities Unrelated to Military Duties Disability compensation for veterans should focus conditions that are not likely to be caused or wors- on service-related conditions. Veterans are eligible ened by military service: arteriosclerotic heart for disability compensation from the VA for medical disease, chronic obstructive pulmonary disease, conditions or injuries that occurred or worsened Crohn’s disease, hemorrhoids, multiple sclerosis, during active-duty military service, as well as for osteoarthritis, and uterine ﬁbroids.11 This proposal conditions that were not necessarily incurred or would end veterans’ disability compensation for worsened due to military service. these non-service-related conditions and save $2.4 billion in FY 2020 and $25.7 billion from FY 2020 The U.S. General Accounting Ofce (now Gov- to FY 2029. ernment Accountability Ofce) identiﬁed seven

ADDITIONAL READING " John S. O’Shea, “Reforming Veterans Health Care: Now and for the Future,” Heritage Foundation Issue Brief No. 4585, June 24, 2016.

MILCONVA

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED

262 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 MILCONVA

263 Report for for Report , GAO/HRD-89-60, , GAO/HRD-89-60, Options for Reducing the Deficit: Reducing Options for Options for Reducing the Deficit: Reducing Options for Options for Reducing the Deficit: Reducing Options for , August 2014, p. 3, p. 2014, , August , p. 187. , p. , p. 34. , p. A FEDERAL BUDGET FOR FISCAL YEAR 2020 , June 3, 2014, http://fas.org/sgp/crs/misc/R43579.pdf (accessed March 16, 2019). March (accessed http://fas.org/sgp/crs/misc/R43579.pdf , June 3, 2014, , July 19, 2018, https://www.cbo.gov/system/files/2018-07/hr5649.pdf (accessed March 16, 2019). All 16, 2019). March (accessed https://www.cbo.gov/system/files/2018-07/hr5649.pdf 2018, , July 19, VA Benefits: Law Allows Compensation for Disabilities Unrelated to Military Service Military to Disabilities Unrelated for Compensation Allows Law Benefits: VA Options for Reducing the Deficit: 2017 to 2026 to the Deficit: 2017 Reducing Options for Options for Reducing the Deficit: 2019 to 2028 to the Deficit: 2019 Reducing Options for heritage.org/BlueprintForBalance Blueprint for Balance: Cost Estimate Cost Veterans’ Disability Compensation: Trends and Policy Options and Policy Trends Compensation: Disability Veterans’ , p. 107. All $2.4 billion represents mandatory savings. mandatory billion represents All $2.4 107. , p. , December 2018, p. 186, https://www.cbo.gov/system/files?file=2018-12/54667-budgetoptions.pdf (accessed March 13, 2019). 13, 2019). March (accessed 186, https://www.cbo.gov/system/files?file=2018-12/54667-budgetoptions.pdf p. 2018, , December , p. 34, https://www.cbo.gov/system/files?file=2018-09/52142-budgetoptions2.pdf (accessed March 17, 2019). All $9.0 billion All $9.0 2019). 17, March (accessed https://www.cbo.gov/system/files?file=2018-09/52142-budgetoptions2.pdf 34, , p. http://www.gao.gov/assets/670/666267.pdf (accessed March 16, 2019). March (accessed http://www.gao.gov/assets/670/666267.pdf https://www.cbo.gov/sites/default/files/113th-congress-2013-2014/reports/45615-VADisability_2.pdf (accessed March 16, 2019). All $1.0 All $1.0 2019). 16, March (accessed https://www.cbo.gov/sites/default/files/113th-congress-2013-2014/reports/45615-VADisability_2.pdf billion in savings $19 an estimated provides within 10 years to limit initial applications option to The savings. mandatory billion represents because they represent the first year of full implementation of the policy. full implementation of year the first represent because they ce, Ofce, Budget cer William ‘Bill’ Mulder (Ret.) Transition Improvement Act of 2018, As Ordered Reported by the House Committee on Veterans’ on Veterans’ Committee the House by Reported As Ordered of 2018, Act Improvement Transition ‘Bill’ Mulder (Ret.) William Ofcer Petty U.S. Senate, re: “Disability Compensation: Review of Concurrent Receipt of Department of Defense Retirement, Department Department Retirement, of Defense of Department Receipt of Concurrent Review Compensation: “Disability re: Senate, U.S. airs, airs, f A and Governmental on Homeland Security Committee Member, Ranking Minority M.D., Coburn, Tom Honorable The to $2.8 billion in increased mandatory spending in FY 2020, for a net savings of $7.9 billion. of $7.9 savings a net for spending in FY 2020, mandatory $2.8 billion in increased $2.0 million represents mandatory savings. Heritage experts assume that the FY 2019 savings and spending levels will apply for FY 2020 FY 2020 for will apply and spending levels savings the FY 2019 that assume experts Heritage savings. mandatory million represents $2.0 represents mandatory savings. The option to “eliminate Concurrent Receipt of Retirement Pay and Disability Compensation for Disabled Disabled for Compensation and Disability Pay of Retirement Receipt Concurrent “eliminate option to The savings. mandatory represents Members and Committees of Congress of Members and Committees airs Disability Compensation, and Social Security Disability Insurance,” GAO14-854R, September 30, 2014, p. 4, 4, p. 2014, 30, September GAO14-854R, Insurance,” Disability and Social Security Compensation, Disability airs f A of Veterans over 10 years. Because savings could accumulate over time, we estimate that $1 billion of the total $19 billion would occur within the first within the first occur billion would $19 billion of the total $1 that estimate we time, over accumulate could Because savings 10 years. over year of implementation in FY 2020. of implementation year Veterans” includes $9 billion in mandatory spending in FY 2020. Heritage experts assume that the FY 2018 savings level will apply for FY will apply for level savings the FY 2018 that assume Heritage experts in FY 2020. spending billion in mandatory includes $9 Veterans” 2020 (as opposed to the estimated $15 billion level for FY 2020) because it represents the first year of full implementation of the policy. of full implementation year the first because it represents FY 2020) for billion level $15 the estimated (as opposed to 2020 Ibid. ce, letter letter Ofce, Accountability Government U.S. Service, and Investigative Audits Forensic Director, Acting Bagdoyan, J. Seto ce, “H.R. 5449, Navy SEAL Chief Navy 5449, “H.R. Ofce, Budget Congressional from based on estimates are FY 2020 for million of $2.0 savings Estimated ce, Ofce, Budget Congressional from based on estimates are FY 2020 billion for of $2.4 savings Estimated ce, Ofce, Accounting General U.S. ce, ce, Of Budget Congressional from based on estimates are FY 2020 billion for of $9.0 savings Estimated Erin Bagalman, “The Number of Veterans That Use VA Health Care Services: A Fact Sheet,” Congressional Research Service Service Research Congressional Sheet,” Fact A Services: Health Care Use VA That Number of Veterans Erin Bagalman, “The Estimated savings of $1.0 billion for FY 2020 are based on estimates from Congressional Congressional from on estimates based are 2020 FY billion for of $1.0 savings Estimated ce, Ofce, Budget Congressional ce, Ofce, Budget Congressional ce, Ofce, Budget Congressional from based on estimates are FY 2020 billion for of $7.9 savings Estimated 2019 to 2028 to 2019 2017 to 2026 to 2017 2019 to 2028 to 2019 airs on July 12, 2018,” 2018,” on July 12, airs f A The option to “End Enrollment in VA Medical Care for Veterans in Priority Groups 7 and 8” includes $10.7 billion in discretionary savings and savings billion in discretionary 7 and 8” includes $10.7 Groups in Priority Veterans for Medical Care in VA Enrollment “End option to The July 1989, https://www.gao.gov/assets/150/147926.pdf (accessed March 16, 2019). March (accessed https://www.gao.gov/assets/150/147926.pdf July 1989,

8. 5. 6. 9. ENDNOTES 11. 10. 1. 2. The Heritage Foundation | 3. 7. 4.

Multiple Subcommittees The Heritage Foundation | heritage.org/BlueprintForBalance $177.2 DISCRETIONARY SAVINGS IN MILLIONS1

Stop Paying Federal Employees Who Work on the Clock for Outside Organizations Federal law requires federal agencies to negotiate public beneﬁt and directly subsidize the operations “ofcial time” with federal labor unions. This allows of government unions. federal employees to work for their labor unions while on the clock as federal employees. Taxpay- The government should require union ofcers to ers pay for federal unions to negotiate collective clock out when they are doing union work. The bargaining agreements, ﬁle grievances, and lobby government should also charge unions fair market the federal government. Most agencies also provide value for the ofce space they use. These changes unions with free “ofcial space” in federal buildings would save over $177 million a year. to conduct union work. These practices provide no

ADDITIONAL READING " James Sherk, “Ofcial Time: Good Value for the Taxpayer?” testimony before the Committee on Oversight and Government Reform, U.S. House of Representatives, June 3, 2011.

PROPOSAL STATUS EXPLANATION MULTIPLE

NOT President’s Budget (FY2020) ADDRESSED

266 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $9.0 DISCRETIONARY SAVINGS IN BILLIONS2

Repeal the Davis–Bacon Act

The Davis–Bacon Act requires federally financed funded construction by nearly 10 percent. The construction projects to pay “prevailing wages.” In Congressional Budget Ofce has estimated that the theory, these wages should reflect going market Davis–Bacon Act applies to approximately a third of rates for construction labor in the relevant area. all government construction. Many state and local However, both the Government Accountability projects are partially or wholly funded with federal Ofce and the Department of Labor’s Inspec- dollars and without prevailing-wage restrictions tor General have repeatedly criticized the Labor would cost substantially less. Department for using self-selected, statistically unrepresentative samples to calculate the prevail- Repealing the Davis–Bacon Act and prohibiting ing-wage rates. Consequently, actual Davis–Bacon states from imposing separate prevailing-wage rates usually reflect union rates that average 22 restrictions on federally funded construction percent above actual market wages. projects would allow lawmakers to reduce federal construction spending by approximately $8.4 billion The Davis–Bacon Act requires taxpayers to over- in appropriations for the Departments of Trans- pay for construction labor. Construction unions portation, Housing and Urban Development, and lobby heavily to maintain this restriction, which Defense and other areas. This would save taxpayers reduces the cost advantage of their non-union billions of dollars every year without reducing the competitors, but it also needlessly inflates the total efective amount of funds available for construc- cost of building infrastructure and other federally tion projects.

ADDITIONAL READING " James Sherk, “Examining the Department of Labor’s Implementation of the Davis–Bacon Act,” testimony before the Committee on Education and the Workforce, U.S. House of Representatives, April 14, 2011. " James Sherk, “Labor Department Can Create Jobs by Calculating Davis–Bacon Rates More Accurately,” Heritage Foundation Backgrounder No. 3185, January 21, 2017.

PROPOSAL STATUS EXPLANATION MULTIPLE

NOT President’s Budget (FY2020) ADDRESSED

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 267 The Heritage Foundation | heritage.org/BlueprintForBalance $0 DISCRETIONARY (NO SAVINGS)3

Extend FCC Spectrum Auction Authority

One of the Federal Communications Commission’s over $114 billion in revenue has been generated for primary functions is the assigning of licenses for the U.S. Treasury. frequencies on the electromagnetic spectrum. Originally, recipients of these licenses were selected The original authorization for auctions was to based on an administrative hearing. That may have expire in 1998, but Congress extended this date sufced when most applicants were seeking radio several times, first to 2007, then to 2011, and again or television broadcast licenses, but it was not well to 2012. Current FCC authority, as provided by the suited to the licensing of cellphone networks. Not Spectrum Pipeline Act, expires in 2022 (or 2025 for only did the hearings’ slow pace conflict with the specified spectrum, including 30 MHz of spectrum needs of the fast-growing industry, but the hearings now used by government agencies). After that date, could not predict which applicant would best serve absent congressional action, the FCC’s auction consumers. Nor did it matter, since most licenses authority will expire. To prevent this from happen- were resold soon after they were assigned. ing, the FCC and the Trump Administration have urged Congress to direct the FCC to auction addi- The idea of auctioning spectrum can be traced back tional spectrum by 2028 and extend FCC auction to Nobel-prize winner Ronald Coase, who sug- authority to 2028. gested spectrum auctions as early as 1958.4 It was not until 1993, however, that Congress authorized Congress should go farther, however. Auctions are the FCC to use them. In the 25 years that followed, a success story and have become an integral part of auctions have served efciently to get spectrum the policy infrastructure. The FCC should be given to those that value it the most. That in turn made permanent auction authority exercisable in regard the wireless revolution possible, fundamentally to any spectrum, subject only to a finding that an improving how Americans live. As a side benefit, auction would be beneficial to consumers.

ADDITIONAL READING " James L. Gattuso, “Raising Revenues with the Auction Option for the Telecommunications Spectrum,” Heritage Foundation Issue Bulletin No. 147, May 11, 1989.

PROPOSAL STATUS EXPLANATION MULTIPLE

President’s Budget (FY2020) INCLUDED

268 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 MULTIPLE

269 In June In June as 7 The Data 8 The Davis–Bacon Act,The Davis–Bacon enacted in The Obama Administration proposed As Americans have long understood, the power to tax is the power long understood, As Americans have 5 A FEDERAL BUDGET FOR FISCAL YEAR 2020 No funds should be used for any grant for which the recipient does grant for which the recipient No funds should be used for any heritage.org/BlueprintForBalance Blueprint for Balance: 6 criteria. Adoption and foster care organizations that meet the substantive requirements of the substantive that meet care organizations criteria. Adoption and foster be hundreds of thousands of jobs and trillions of dollars of gross domestic product. of jobs and trillions of dollars of gross domestic be hundreds of thousands belief that marriage for are reserved is the union of one man and one woman or that sexual relations for government contracts, student loans, and other forms of support as long as they meet the relevant forms of support as long as they meet and other loans, student contracts, for government federally contracted projects through union hiring halls. PLAs inflate construction costs by 12 percent to by costs inflate construction PLAs projects through union hiring halls. federally contracted such a marriage. schools, and other organizations that interact with the government should be held to the same standards standards should be held to the same that interact with the government organizations other and schools, sincere people here and throughout the world.” sincere people here and throughout save more than $100 billion over the next 10 years under current spending levels. the next than $100 billion over more save of America’s energy needs is met through conventional carbon-based fuels. Restricting opportunities for Restricting carbon-based fuels. through conventional energy needs is met of America’s child welfare agencies should be eligible for government contracts without having to abandon the religious to abandon the religious child welfare agencies contracts without having should be eligible for government or group’s licensing, or accreditation based on an individual’s contracts, grants, discrimination in tax policy, of competence as everyone else, but their view that marriage as everyone is the union of a man and a woman should of competence or require the Labor Department to use superior Bureau of Labor Statistics data to estimate Davis–Bacon Davis–Bacon data to estimate of Labor Statistics Department to use superior Bureau or require the Labor each federal construction dollar, delivering more infrastructure without the need to increase spending levels. spending levels. without the need to increase more infrastructure delivering dollar, each federal construction government to force these entities or people to violate beliefs about marriage that, as even Justice Anthony Anthony violate beliefs about marriage to force these entities or people to Justice government that, as even government entities must treat same-sex relationships as marriages. The Court, however, did not say say did not The Court, however, relationships as marriages. treat same-sex entities must government Enforce data-quality standards. standards. Enforce data-quality Prohibit any agency from regulating greenhouse gas emissions. agency regulating greenhouse gas emissions. from Prohibit any Prohibit government discrimination in tax policy, grants, contracting, and accreditation. grants, discrimination in tax policy, Prohibit government Eliminate Davis–Bacon requirements and project labor agreements. project labor agreements. and requirements Davis–Bacon Eliminate and businesses, with no climate or environmental benefit to show for it. The cumulative economic loss will for it. The cumulative benefit to show with no climate or environmental and businesses, and implemented a series of climate change regulations to reduce greenhouse gas emissions from vehicles, and implemented a series of climate change to reduce greenhouse gas emissions from vehicles, regulations agreements require using union compensation rates, following union work rules, and hiring all workers on and hiring all workers union work rules, following rates, using union compensation agreements require and follow union work rules. These rules inflate the cost of federal construction by nearly 10 percent on nearly 10 percent by of federal construction inflate the cost These rules union work rules. and follow contract a government require the main contractor of project labor agreements (PLAs) average. Similarly, the power to destroy. Respect for freedom after the Supreme Court’s ruling takes several forms. Charities, Charities, forms. several ruling takes for freedom after the Supreme Court’s Respect to destroy. the power that private schools, charities, businesses, or individuals must also do so. There is no justification for the is no justification There also do so. must or individuals businesses, charities, that private schools, to sign a collective bargaining agreement as a condition of winning a project bid. Collective bargaining a project bid. Collective agreement as a condition of winning bargaining to sign a collective educational universities, hospitals, and nonprofit organizations are available to the public. The Information Quality Act organizations are available and nonprofit hospitals, universities, heavy-duty trucks, airplanes, hydraulic fracturing, and new and existing power plants. More than 80 percent More plants. power fracturing, and new and existing hydraulic airplanes, trucks, heavy-duty not agree to make all data produced under the grant publicly available in a manner that is consistent in a manner that is consistent available all data produced under the grant publicly agree to make not never disqualify them from government programs. Educational institutions, for example, should be eligible institutions, Educational programs. disqualify them from government never POLICY RIDERS POLICY values that led them to help orphaned children in the first place. Congress should prohibit government place. Congress should prohibit government children in the first values that led them to help orphaned with the Data Access Act, part of the FY 1999 Omnibus Appropriations Act 105–277), (Public Law Code § 3516). of the Information Quality Actwell as in compliance with the standards (44 U.S. workers who are not members of a union. Eliminating Davis–Bacon and prohibiting PLAs would stretch stretch and prohibiting PLAs would Davis–Bacon members of a union. Eliminating who are not workers The Heritage Foundation | Kennedy noted in his majority opinion recognizing gay marriage, recognizing gay in his majority opinion are held “in good reasonable and noted faith by Kennedy Barring complete repeal, Congress could suspend the rule for projects funded by the appropriations bill the appropriations by suspend the rule for projects funded repeal, Congress could Barring complete 2015, the Supreme Court of the United States redefined marriage throughout America by mandating that States redefined marriage mandating that the Supreme Court of the United by throughout America 2015, 18 percent on top of increased costs attributed to Davis–Bacon and discriminate against the 87 percent of the 87 percent against and discriminate to Davis–Bacon attributed of increased costs 18 percent on top ectively requires construction contractors on federal projects to use union wage on federal projects contractors benefit scales and requires construction 1931, efectively Access Act requires federal agencies to ensure that data produced under grants to and agreements with Americans to use such an abundant, afordable energy source will only bring economic pain to households “prevailing wages” so that they more closely reflect market pay. Eliminating Davis–Bacon and PLAs would and PLAs Eliminating Davis–Bacon pay. “prevailing wages” they more closely reflect market so that MULTIPLE Withhold grantsforseizureofprivateproperty. 270 itself islegitimatelyblighted,suchaspropertythatposesaconcrete harmtohealthandsafety. Congress not have occurredwereitnot forthepurposeofeconomicdevelopment. Localgovernments oftenuse related takings, suchasblight-relatedtakings. Sincethere is asubjective elementtodetermining whether meaningful actioninthedecadesincethislandmarkdecisionand,toextent thatitiswithinitspower, Credible compliancewiththeInformationQualityAct. is little accountabilitythatcouldensureagency maximizing thequality, objectivity, utility, andintegrityofinformation(includingstatistical information) andBudget,withrespecttoagencies,requires theOfceofManagement to“issueguidelines ensuringand held in that thetakingwouldnot have occurredbutforeconomicdevelopment andisforapublicuse)ortoaddress allegedly blightedarea.Theonlyseizures ofpropertythatshouldbeallowedallegedly areseizuresofpropertythat a takingisforeconomicdevelopment, thecondemnorshouldberequiredtoestablish thatatakingwould and allowed undertheFifthAmendmentofUnitedStatesConstitution. Congresshasfailedtotake another privatepartyforeconomicdevelopment. are insufcient. disseminated by theagency.” domain toseizeprivatepropertyeitherforeconomicdevelopment (unlessthecondemnorcandemonstrate The Heritage Foundation | Foundation Heritage The should withholdgrantsforinfrastructure development tostates orother jurisdictionsthatinvoke eminent should provide propertyowners inallstates necessary protection fromeconomicdevelopment andclosely arenecessaryscience andtransparency elementsofsoundpolicy. blight (unlessthepropertyitselfposesaconcrete harmtohealthandsafety). toseizeprivateproperty,broad definitionsof“blight” includingnon-blightedpropertythatislocatedinan Kelo v. CityofNewLondon Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance 9 However, andthere Act, theOMBhasundulyrestricted theDataAccess thatthegovernment may seizeprivatepropertyandtransferitto A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A 11 Thistypeoftakingwas deemedtobefora“publicuse” On June 23, 2005, theUnitedStatesSupremeCourt 10 Standardsmust becodified;guidelines 12 MULTIPLE

271 No. 160, 160, No. Labor Labor , , The Heritage , The Factsheet , GAO-15-9, October 2014, 2014, October , GAO-15-9, cial Time Usage in the Federal Federal Usage in the Ofcial Time Spectrum Auctions: Fiscal Year 2018 Year Fiscal Auctions: Spectrum , Vol. II (October 1959), pp. 1–40. pp. 1959), II (October , Vol. olk University, February February olk University, Suf at Hill Institute , Beacon Journal of Law and Economics Law Journal of No. 3026, June 22, 2015, June 22, 2015, 3026, No. A FEDERAL BUDGET FOR FISCAL YEAR 2020 Backgrounder , August 19, 2004, https://fas.org/sgp/crs/RL32532.pdf (accessed March 15, 2019). 15, March (accessed https://fas.org/sgp/crs/RL32532.pdf 2004, 19, , August Environmental Policy Guide: 167 Recommendations for Environmental Policy Reform Policy Environmental for Recommendations Guide: 167 Policy Environmental : Time for Congress to Protect American Protect to Congress for : Time Kelo , May 2018, https://www.opm.gov/policy-data-oversight/labor-management-relations/reports-on- 2018, , May , March 1, 2013, https://fas.org/sgp/crs/secrecy/R42983.pdf (accessed March 15, 2019), and Center for for and Center 2019), 15, March (accessed https://fas.org/sgp/crs/secrecy/R42983.pdf 1, 2013, , March , 545 U.S. 469 (2005), https://www.law.cornell.edu/supct/html/04-108.ZS.html (accessed April 12, 2018). (accessed (2005), https://www.law.cornell.edu/supct/html/04-108.ZS.html 469 U.S. , 545 heritage.org/BlueprintForBalance Blueprint for Balance: , 576 U.S. ___ (2015), https://www.supremecourt.gov/opinions/14pdf/14-556_3204.pdf (accessed May 14, 2018). 14, May (accessed https://www.supremecourt.gov/opinions/14pdf/14-556_3204.pdf ___ (2015), U.S. , 576 The Federal Davis–Bacon Act: The Prevailing Mismeasure of Wages of Mismeasure Prevailing The Act: Davis–Bacon Federal The Report for Congress for Report Report for Congress for Report http://www.heritage.org/research/reports/2015/06/a-decade-after-kelo-time-for-congress-to-protect-american-propertyowners#_ftn1. https://www.congress.gov/bill/106th-congress/house-bill/4577/text (accessed March 15, 2019). 15, March (accessed https://www.congress.gov/bill/106th-congress/house-bill/4577/text https://www.fcc.gov/sites/default/files/spectrum-auctions-program-2018.pdf (accessed March 15, 2019). 15, March (accessed https://www.fcc.gov/sites/default/files/spectrum-auctions-program-2018.pdf erence of $9.040 of $9.040 erence billion, a dif only $91.312 cost spending would that in costs, increase percent 9.9 of Davis–Bacon’s billion. In the absence capture taxpayers federal and that FY 2020 in constant remain costs public construction the FY 2019 that assume billion. Heritage experts https://www.census.gov/construction/c30/pdf/release.pdf (accessed March 13, 2019), to spending levels in the absence of Davis–Bacon. of Davis–Bacon. in the absence levels spending to 13, 2019), March (accessed https://www.census.gov/construction/c30/pdf/release.pdf https://www.gao.gov/assets/670/666619.pdf (accessed March 13, 2019). Heritage experts do not include any estimated savings for charging charging for savings estimated do not include any Heritage experts 13, 2019). March (accessed https://www.gao.gov/assets/670/666619.pdf Property Owners,” Heritage Foundation Heritage Foundation Owners,” Property ectiveness, “President Signs Data Access Law (P.L. 105-277,” http://www.thecre.com/ombpapers/PL105-277.htm (accessed (accessed http://www.thecre.com/ombpapers/PL105-277.htm 105-277,” (P.L. Law Access Signs Data “President ectiveness, f E Regulatory 2019). 15, March Service Research http://www.heritage.org/research/reports/2015/03/environmental-policy-guide. 2015, Foundation, Davis–Bacon increases construction costs by an estimated 9.9 percent as documented in Sarah Glassman, Michael Head, David G. Tuerck, G. Tuerck, Head, David Michael Glassman, in Sarah as documented percent 9.9 an estimated by costs construction increases Davis–Bacon cial time, as a 2014 GAO report found significant problems problems significant found report GAO as a 2014 of ofcial time, true costs the understates certainly almost estimate This FY 2020. U.S. Department of Commerce, Economics and Statistics Administration, U.S. Census Bureau, March 13, 2019, 13, 2019, March Bureau, Census U.S. Administration, and Statistics Economics of Commerce, Department U.S. type of spectrum being auctioned and the number of licenses available. From 2013–2017, the FCC held seven spectrum auctions auctions spectrum held seven the FCC 2013–2017, From available. and the number of licenses being auctioned of spectrum type ce space because Heritage experts do not have the necessary data to estimate those savings. estimate to data the necessary do not have Heritage experts because space ofce their use of federal unions for proceeds, some of which go toward deficit reduction, until FY 2026. Proceeds from auctions are highly variable and depend on the highly variable are auctions from Proceeds FY 2026. until deficit reduction, some of which go toward proceeds, Service Service all of the value of the savings from eliminating Davis–Bacon. eliminating from of the savings all of the value Commission, Communication Federal billion per auction. of $8.95 proceeds with average and Paul Bachman, and Paul ce, Ofce, Accountability Government See U.S. underreporting. led to of ofcial time that in agencies’ reporting and inaccuracies Relations Activities: Actions Needed to Improve Tracking and Reporting of the Use and Cost of Ofcial Time of and Cost the Use of and Reporting Tracking Improve Needed to Actions Activities: Relations spending of $313.6 billion annually as found in press release, “Monthly Construction Spending, January 2019,” Spending, January 2019,” Construction “Monthly release, in press annually as found spending of $313.6 billion cial-time-usage-in-the-federal-government.pdf (accessed March 13, 2019). The OPM estimated the cost the cost estimated OPM The 13, 2019). March (accessed fcial-time-usage-in-the-federal-government.pdf ofcial-time/reports/2016-o million for of $177.2 the same figure assume Heritage experts data, recent more million. Absent $177.2 at of ofcial time in FY 2016 ce, we estimate that 32% of total public construction spending is subject to the DBA.” Ibid., p. 6. Ibid., p. the DBA.” to spending is subject public construction of total 32% that estimate we Ofce, Budget the Congressional from data 2008, http://www.beaconhill.org/BHIStudies/PrevWage08/DavisBaconPrevWage080207Final.pdf (accessed March 15, 2019). “Using 2019). 15, March (accessed 2008, http://www.beaconhill.org/BHIStudies/PrevWage08/DavisBaconPrevWage080207Final.pdf Estimated savings of $9.040 billion for FY 2020 were calculated by comparing current public construction public construction current comparing by calculated were FY 2020 billion for of $9.040 savings Estimated H.R. 4577, Consolidated Appropriations Act, 2001, Public Law 106–554, 106th Cong., December 21, 2000, § 515, § 515, 21, 2000, December 106th Cong., 106–554, Public Law 2001, Act, Appropriations Consolidated H.R. 4577, ce of Personnel Management, Management, of Personnel Ofce based on U.S. are FY 2020 million for of $177 savings Estimated Daren Bakst, “A Decade After Decade After “A Bakst, Daren Robert Gordon and Diane Katz, eds., and Diane Katz, Gordon Robert See Eric A. Fischer, “Public Access to Data from Federally Funded Research: Provisions in OMB Circular A-110,” Congressional Research Research Congressional A-110,” in OMB Circular Provisions Research: Funded Federally from Data to “Public Access See Eric A. Fischer, R. H. Coase, “The Federal Communications Commission,” Commission,” Communications Federal “The R. H. Coase, Kelo v. City of New London New of City v. Kelo Obergefell v. Hodges v. Obergefell The Heritage Foundation, “People of Faith Deserve Protection from Government Discrimination in the Marriage Debate,” in the Marriage Debate,” Discrimination Government from Protection Deserve of Faith “People Heritage Foundation, The See Curtis W. Copeland and Michael Simpson, “The Information Quality Act: OMB’s Guidance and Initial Implementation,” Congressional Congressional and Initial Implementation,” Guidance OMB’s Act: Quality Information and Michael Simpson, “The Copeland See Curtis W. Because the FCC currently holds spectrum auction authority through FY 2025, this proposal would not generate any new sale new any generate not would this proposal FY 2025, through authority auction holds spectrum currently Because the FCC Government: Fiscal Year 2016 Year Fiscal Government: According to the CBO, as noted, public construction spending as of January 2019 totaled $313.6 billion, 32 percent of which is $100.352 of which is $100.352 percent 32 $313.6 billion, totaled spending as of January 2019 public construction as noted, the CBO, to According July 2, 2015, http://thf_media.s3.amazonaws.com/2015/pdf/FS_160.pdf. July 2, 2015,

8. 5. 6. 9. ENDNOTES 12. 10. 11. 1. 2. The Heritage Foundation | 3. 7. 4.

State, Foreign Operations, and Related Programs The Heritage Foundation | heritage.org/BlueprintForBalance $10 DISCRETIONARY SAVINGS IN MILLIONS1

End Funding for the United Nations Intergovernmental Panel on Climate Change and the U.N. Framework Convention on Climate Change

The IPCC was established in 1988 “to provide 2015, the Palestinian Authority deposited its instru- policymakers with regular scientific assessments ment of accession to the UNFCCC. In accordance with concerning climate change, its implications and Article 23(2) of the treaty, the PA ofcially became potential future risks, as well as to put forward the 197th party to the UNFCCC on March 17, 2016.5 adaptation and mitigation strategies. It has 195 As was the case when the Palestinians joined the member states.”2 The organization’s studies3 have United Nations Educational, Scientific, and Cultural been subject to bias, politicization, and selective data. Organization (UNESCO),6 this should have triggered The IPCC has also been instrumental in confining a U.S. law prohibiting any future U.S. funding for the global-warming research and debate to a narrow, UNFCCC. The Obama Administration, however, politically correct perspective, claiming that man- continued funding based on the argument that the made greenhouse gas emissions are the primary UNFCCC is a treaty, not an international organization. drivers of catastrophic, accelerating global warming. IPCC data and analysis should not be relied upon or In fact, the UNFCCC is a treaty-based international disseminated unless they first meet the standards organization, and the Framework Convention is the that Congress has set in the Information Quality Act. founding legal document upon which the organization and its structure are based. As with UNESCO, Current law prohibits the transfer of U.S. funds to the U.S. should enforce this law for the UNFCCC international organizations that grant full member- and any other organization that grants full membership to the Palestinian territories.4 On December 18, ship to the Palestinian territories.

ADDITIONAL READING " David W. Kreutzer, “A Cure Worse than the Disease: Global Economic Impact of Global Warming Policy,” Heritage Foundation Backgrounder No. 2802, May 28, 2013. " David Kreutzer, “If IPCC Sea Level Numbers Aren’t Bad Enough, Try Tripling Them,” The Daily Signal, July 22, 2011. " Brett D. Schaefer and Nicolas D. Loris, “U.S. Should Put U.N. Climate Conferences on Ice,” Heritage Foundation Issue Brief No. 3794, December 6, 2012. " Nicolas D. Loris, Brett D. Schaefer, and Steven Groves, “The U.S. Should Withdraw from the United Nations Framework Convention on Climate Change,” Heritage Foundation Backgrounder No. 3130, June 9, 2016. " Brett D. Schaefer and James Phillips, “Provocative Palestinian U.N. Actions Require Strong U.S. Response,” Heritage Foundation Issue Brief No. 4329, January 12, 2015.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED SFOPS

274 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $80 DISCRETIONARY SAVINGS IN MILLIONS7

End Funding for the United Nations Development Program

The UNDP conducts projects in more than 170 Moreover, UNDP aid meant to assist sufering countries around the world. It aspires to be the populations in many authoritarian countries can U.N. system’s premier anti-poverty agency, but the inadvertently help perpetuate their sufering. In the impact of the billions of dollars it spends every year past, the UNDP has funded inappropriate activities on antipoverty programs is unclear. For example, a in Iran, North Korea, Venezuela, and Zimbabwe.9 January 2013 UNDP Evaluation Ofce report found The U.S. has ample options for ﬁnancing antipoverty that the organization spent over $8 billion on anti- programs, either bilaterally through U.S. assistance poverty activities between 2004 and 2011 but that programs or multilaterally through the World this focus was lost at the country level: Bank or regional development banks, and need not pursue these eforts through a ﬂawed organization At the strategic planning level and at the Executive like the UNDP. Board, poverty reduction is accorded top priority. However, by the time it reaches the country level, the focus on poverty reduction often becomes

diluted…. Many of [the UNDP’s] activities have only remote connections with poverty, if at all.8

ADDITIONAL READING " Ambassador Terry Miller, “The United Nations and Development: Grand Aims, Modest Results,” Heritage Foundation Special Report No. SR-86, September 22, 2010. " Brett Schaefer, “Why Does UNDP Continue to Aid Repressive Regimes?” The Daily Signal, August 27, 2010.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED SFOPS

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 275 The Heritage Foundation | heritage.org/BlueprintForBalance $32.5 DISCRETIONARY SAVINGS IN MILLIONS10

Eliminate Funding for the United Nations Population Fund

For years, the U.S. withheld funding for the UNFPA In a January 23, 2017, memorandum, President under the Kemp–Kasten Amendment, which Donald Trump directed the “Secretary of State to prohibits U.S. international aid from support- take all necessary actions, to the extent permitted ing coercive abortion procedures or involuntary by law, to ensure that U.S. taxpayer dollars do not sterilization.11 In 2009, President Barack Obama fund organizations or programs that support or par- announced that he would restore funding, and ticipate in the management of a program of coercive the U.S. has since sent tens of millions of taxpayer abortion or involuntary sterilization.”13 In April dollars to the UNFPA. In FY 2017, the U.S.-provided 2017, the Trump Administration announced that it allocation was $5.8 million.12 would withhold $32.5 million in funding from the UNFPA.14

ADDITIONAL READING " Brett D. Schaefer, “Congress Should Renew the Report Requirement on U.S. Contributions to the U.N. and Reverse Record Setting Contributions to the U.N.,” Heritage Foundation WebMemo No. 3324, July 22, 2011. " Olivia Enos, Sarah Torre, and William T. Wilson, “An Economic and Humanitarian Case for Pressing China to Rescind the Two-Child Policy,” Heritage Foundation Backgrounder No. 3146, November 18, 2016.

PROPOSAL STATUS EXPLANATION

Shifts spending to Family Planning and Reproductive President’s Budget (FY2020) INCLUDED Health. SFOPS

276 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $193 DISCRETIONARY SAVINGS IN MILLIONS15

Enforce the Cap on United Nations Peacekeeping Assessments

Current U.S. law caps U.S. payments for U.N. peace- The Trump Administration has repeatedly stated keeping at 25 percent of the budget, but the U.N. its desire to reduce the U.S. share of the U.N. peace- will assess the U.S. at 27.8912 percent in 2019.16 In keeping budget to 25 percent. President Trump the past, appropriations bills allowed payments reiterated this objective in his September 2017 above the 25 percent cap to avoid arrears. Congress speech to the U.N., stating that “[t]he United States ended this practice for FY 2018 and should con- bears an unfair cost burden” and “that no nation tinue to enforce the cap and not pay any resulting should have to bear a disproportionate share of the arrears until the U.N. adopts a scale of assessments burden, militarily or ﬁnancially.”17 As noted, Con- that speciﬁes a 25 percent maximum share for any gress should continue to enforce the cap until the member state. U.N. adopts a maximum peacekeeping assessment of 25 percent.

ADDITIONAL READING " Brett D. Schaefer, “Diplomatic Efort to Reduce America’s Peacekeeping Dues Must Start Now,” Heritage Foundation Issue Brief No. 4781, November 1, 2017. " Brett D. Schaefer, “The U.S. Should Push for Fundamental Changes to the United Nations Scale of Assessments,” Heritage Foundation Backgrounder No. 3023, June 11, 2015.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED SFOPS

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 277 The Heritage Foundation | heritage.org/BlueprintForBalance $359 DISCRETIONARY SAVINGS IN MILLIONS18

End U.S. Funding for the United Nations Relief and Works Agency for Palestine Refugees The UNRWA was established more than 60 years to end the refugee status of Palestinians and facili- ago as a temporary initiative to address the needs tate their integration as citizens of their host states of Palestinian refugees and facilitate their resettle- or resettlement in the West Bank and Gaza, where ment or repatriation, but by applying refugee status the Palestinian government should be responsible to the descendants of the original refugees, it has for their needs. The few remaining ﬁrst-genera- caused the problem to grow larger. This is unique to tion Palestinian refugees and those more recently the UNRWA: The deﬁnition of “refugee” employed displaced should be placed under the responsibility by the United Nations High Commissioner for Refu- of the UNHCR. gees (UNHCR), which addresses every other refugee population for the U.N., is consistent with the 1951 In August 2018, the Trump Administration Refugee Convention. While UNHCR may classify announced that “the United States will not make multiple generations as refugees, they qualify based additional contributions to UNRWA.”19 Congress on the criteria outlined in the 1951 Convention as should work with the Administration to shift it currently exists, not on their relationship to the responsibility for recent Palestinian refugees to the original refugees. UNHCR, provide funding to governments that are hosting Palestinians to facilitate integration, and To advance the long-term prospects for peace, the demand that the Palestinians assume responsibility U.S. should encourage winding down the UNRWA for the services provided by the UNRWA.

ADDITIONAL READING " Brett D. Schaefer and James Phillips, “Time to Reconsider U.S. Support of UNRWA,” Heritage Foundation Backgrounder No. 2997, March 5, 2015.

PROPOSAL STATUS EXPLANATION

Not addressed, although the Administration has halted NOT President’s Budget (FY2020) U.S. payments to UNRWA, and the budget does not ADDRESSED contain a funding request for UNRWA. SFOPS

278 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $140 DISCRETIONARY SAVINGS IN MILLIONS20

Eliminate Funding for the Global Environment Facility

The GEF manages the Special Climate Change According to a 2014 Transparency International Fund and the Least Developed Countries Fund, report, the GEF lacks transparency in public access with a heavy emphasis on grants and financing to information, anticorruption measures at the for global-warming-adaptation projects. Since its fund-recipient level, accountability at the executive creation by the World Bank and U.N. in 1991, the level, and participation of project stakeholders.22 GEF has been the designated financial mecha- The GEF has allocated funds to help countries nism for a number of problematic international meet their respective Paris Protocol climate tar- agreements, including the U.N. Convention on gets, including paying for green energy projects and Biological Diversity, U.N. Framework Convention “climate friendly” livestock initiatives.23 Instead of on Climate Change, Stockholm Convention on using taxpayer dollars to fund energy and inter- Persistent Organic Pollutants, U.N. Convention to national climate-change projects, the U.S. should Combat Desertification, Minamata Convention commit to free-market principles that will provide on Mercury, and Montreal Protocol on Substances afordable, reliable energy, not government-se- that Deplete the Ozone Layer, as well as a number lected technologies and energy sources. of international waters agreements such as the U.N. Convention on the Law of the Sea.21

ADDITIONAL READING " David W. Kreutzer, “A Cure Worse Than the Disease: Global Economic Impact of Global Warming Policy,” Heritage Foundation Backgrounder No. 2802, May 28, 2013. " Nicolas D. Loris, “Economic Freedom, Energy, and Development,” Chapter 5 in Terry Miller and Anthony B. Kim, 2015 Index of Economic Freedom (Washington: The Heritage Foundation and Dow Jones & Company, Inc., 2015), pp. 57–67.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED SFOPS

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 279 The Heritage Foundation | heritage.org/BlueprintForBalance $1.5 DISCRETIONARY SAVINGS IN MILLIONS24

Partially Withhold Assessed U.S. Payments to the Organisation for Economic Co-operation and Development (OECD) The OECD’s mission “is to promote policies that Numerous economic studies show that tax compe- will improve the economic and social well-being of tition benefits developed and developing economies people around the world.”25 In one area, however, alike, creating what Nobel-laureate economist the OECD has reliably promoted policies antithet- Gary Becker calls “a race to the top rather than ical to that goal: higher taxes. Tax-related work by the bottom by limiting the ability of powerful and the OECD’s Centre for Tax Policy and Administra- voracious groups and politicians in each nation to tion and other OECD directorates (for example, on impose their will at the expense of the vast major- carbon taxes) has focused almost entirely on studies ity.”26 As Milton Friedman noted, tax competition that buttress political arguments for higher taxes is a “liberalizing force in the world economy” and implementation of more intrusive ways to col- that “forces governments to be more fiscally lect them. This focus is driven by high-tax European responsible.”27 members of the OECD intent on promoting policies condemning international tax avoidance and eva- The United States should continue to withhold $1.5 sion in order to prevent the flight of taxes needed million of its assessed annual payment to the OECD to support their generous welfare programs. The as long as the OECD continues to support only tax ultimate goal of its “Base Erosion and Profit Shifting studies that urge OECD members to increase taxes (BEPS)” Project and a proposed Protocol amending and implement more intrusive tax collection meth- the Multilateral Convention on Mutual Assistance ods. This partial hold could be lifted if and when in Tax Matters is to centralize and harmonize global the OECD undertakes to conduct an equal amount tax rules and increase efective tax rates on interna- of research on ways to cut government spending, tional firms. reduce taxation, and make bureaucracies smaller and more efcient.

ADDITIONAL READING " James M. Roberts and Adam N. Michel, “Trump Cut America’s Taxes: Now He Should Defund OECD Eforts to Raise Them,” Heritage Foundation Issue Brief No. 4861, May 29, 2018.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED SFOPS

280 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $79.5 DISCRETIONARY SAVINGS IN MILLIONS28

Eliminate the U.S. Trade and Development Agency

Created in 1961, the USTDA asserts that it “helps The USTDA’s activities belong more properly to the companies create U.S. jobs through the export of U.S. private sector. To the extent that the agency con- goods and services for priority development proj- tinues to have a viable mission, that mission can be ects in emerging economies.” Through pilot projects, achieved by State Department Economic and Com- technical assistance, and other programs, it “links mercial Ofcers using existing budgetary resources. U.S. businesses to export opportunities by funding project preparation and partnership building The best way to promote trade and development is activities that develop sustainable infrastructure to reduce trade barriers. Another way is to reduce and foster economic growth in partner countries.”29 the federal budget deﬁcit and thereby reduce In practice, however, the USTDA has become little federal borrowing from abroad so that more formore than another source of taxpayer-subsidized eign dollars can be spent on U.S. exports instead of crony corporatism. federal Treasury bonds. A dollar borrowed from abroad by a government is a dollar not available to buy U.S. exports or invest in the private sector of the

U.S. economy.30

ADDITIONAL READING " James M. Roberts and Brett D. Schaefer, “An Overhaul of America’s Foreign Assistance Programs Is Long Overdue,” Heritage Foundation Backgrounder No. 3247, September 19, 2017. " “Eliminate the U.S. Trade and Development Agency,” in Republican Study Committee, Securing America’s Future Economy: Fiscal Year 2018 Budget, pp. 150–151.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED SFOPS

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 281 The Heritage Foundation | heritage.org/BlueprintForBalance $1.0 DISCRETIONARY SAVINGS IN BILLIONS31

Overhaul U.S. Development Assistance Programs

The broad goals of U.S. assistance programs have The United States Agency for International long been to assist people in crises, enhance market Development (USAID) needs to be completely opportunities for American products and invest- restructured, with its core health and humanitarian ments by catalyzing economic growth in developing missions incorporated into the State Department. countries, and promote U.S. national security and foreign policy by supporting allies and countering The Millennium Challenge Corporation should take adversaries. These are worthy goals, but U.S. foreign charge of all U.S. development assistance with the assistance needs to update concepts and priori- goal of graduating all countries from the need for ties, eliminate duplication and waste, and address foreign aid. changing circumstances. Fundamental reform has languished far too long. As a result, many U.S. for- Properly designed and directed, U.S. foreign aid can eign aid programs can no longer help countries in support America’s national interests by addressing need or serve U.S. interests efectively. humanitarian crises; promoting policy changes necessary for economic growth led by the private America’s fragmented and micromanaged foreign sector, which is the most reliable and sustainable aid programs, split among more than 25 federal path to development; and advancing U.S. diplomatic agencies, must be reﬁtted to meet 21st cen- and security priorities. tury challenges.

PROPOSAL STATUS EXPLANATION

Consolidates economic assistance programs into the Economic Support and Development Fund (ESDF) and President’s Budget (FY2020) INCLUDED various humanitarian assistance accounts into the new International Humanitarian Assistance (IHA) account. SFOPS

282 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $750 DISCRETIONARY SAVINGS IN MILLIONS32

Eliminate the State Department’s Assistance for Europe, Eurasia and Central Asia (AEECA) Account The State Department’s AEECA account was Most of the AEECA countries have successfully established after the Cold War in the early 1990s to made the transition and are able to aford to hire assist former Warsaw Pact countries in Central and their own technical advisors for any additional Eastern Europe and the newly independent states help they need, and the relatively few that remain of the former Soviet Union in their transition from trapped in authoritarian socialist systems will not Communism to market-based democracy. beneﬁt from additional funding by American taxpayers at this point. Any additional U.S. assistance Thirty years of funding the attainment of that goal to the AEECA countries should be funded through is enough. Economic Support Funds.

ADDITIONAL READING

" James M. Roberts and Brett D. Schaefer, “An Overhaul of America’s Foreign Assistance Programs Is Long Overdue,” Heritage Foundation Backgrounder No. 3247, September 19, 2017.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED SFOPS

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 283 The Heritage Foundation | heritage.org/BlueprintForBalance $52.5 DISCRETIONARY SAVINGS IN MILLIONS33

Eliminate the African Development Foundation and the Inter-American Foundation The African Development Foundation has been Their objectives can and should be achieved by providing relatively small grants to promote eco- the Millennium Challenge Corporation or by the nomic growth in sub-Saharan Africa since 1984. The U.S.-funded multilateral development banks that Inter-American Foundation has been doing similar these agencies were established to complement (the work in Latin America since 1969. African Development Bank and Inter-American Development Bank). These small U.S. agencies are wasteful in the sense that there is no need for them to be stand-alone operations with their own administrative stafs and overhead.

PROPOSAL STATUS EXPLANATION

Provides a small appropriation to facilitate closeout and President’s Budget (FY2020) INCLUDED merger with USAID. SFOPS

284 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $160 DISCRETIONARY SAVINGS IN MILLIONS34

Close the 15 Smallest USAID Overseas Missions

Facing ongoing federal budget deficits, the United This cut should be seen as a first step toward a com- States can no longer aford the luxury of main- prehensive overhaul of all U.S. assistance programs, taining the extensive foreign aid presence that is which need updated concepts and priorities, elimi- reflected by the existence of approximately 100 nation of duplication and waste, and transformation overseas USAID missions. In some cases, these mis- to address changing global circumstances. Because sions are located in countries that are not critical to fundamental reform has languished far too long, the achievement of short-term to medium-term U.S. many U.S. foreign aid programs can no longer help foreign policy objectives. In other cases, other West- countries in need or serve U.S. interests efectively. ern donor nations have more extensive programs in those countries, and there is no need for USAID to duplicate their eforts.

PROPOSAL STATUS EXPLANATION

NOT President’s Budget (FY2020) ADDRESSED SFOPS

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 285 SFOPS Authorities Act, FiscalYearAuthorities Act, 2017, 286 The U.S. shouldconductacost-benefit analysis ofU.S. participationinallinternationalorganizationsand Department ofState. $9.72 billiontotheU.N. system accordingtotheU.N. ChiefExecutives Board.TheDepartmentofState United States. The Heritage Foundation | Foundation Heritage The Increase oversight ofinternationalorganizations. POLICY RIDERS meetings relatedtotreatiestheU.S. isnegotiatingorrelatedtotreaties to whichtheU.S. isnot aparty. This that reportdoesnot addressthequestion ofwhether theU.S. valueforthosecontributions. isreceivinggood to thisprincipleisthattheU.S. shouldbeabletopay thecosts ofitsown diplomaticdelegationsthatattend State reportedthattotal contributionstotheInternationalOrganizationstotaled $12.124 billion. an annualreporttoCongressonU.S. contributionstotheU.N. system. InFY2017, theU.S. Departmentof Do not fundactivitiesrelatedtounratifiedtreaties. exception, however, doesnot allow forthefundingoftreatybodiesorany delegationother thanthatofthe either intheU.S. orelsewhere.Treatiesarecompactsbetween thenationsthatarepartytothemand of theSenateandhasnot beenproperlyimplementedinU.S. law, theU.S. shouldnot fundany ofitsactivities, organization towhichtheUnitedStatesbelongsadvancesAmericaninterests.” of StateandUSAIDwillreviewmultilateralaidcontributionstoevaluatehow eachmultilateral establish adedicatedunitforinternational-organizationissuesintheOfceofInspectorGeneral contributor, providing one-fifthoftotal contributionsannually over thatperiod.In2016, theU.S. provided contributions increasedfrom$14.96 billionin2002to$45.72 billionin2016. TheU.S. remainsthelargest should thereforebefundedby thenations thathave legallyaccepted theirobligations. Theonlyexception 37 Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance IntheFY2019 announcedthat“theDepartment budget, theTrumpAdministration 35 enactedin2016, andBudget tosubmit requirestheOfceofManagement A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A U.N. system revenues fromassessedandvoluntary If atreatyhasnot received theadviceandconsent 38 36 However, SFOPS

287 , p. 12. , p. , January 2013, pp. vii pp. , January 2013, Department of State, Foreign Foreign State, of Department Department of State, Foreign Operations, Operations, Foreign State, of Department Evaluation of UNDP Contribution to Poverty Reduction Poverty to UNDP Contribution of Evaluation , p. 70. Heritage experts assume that spending holds steady through FY 2020. through spending holds steady that assume Heritage experts 70. , p. A FEDERAL BUDGET FOR FISCAL YEAR 2020 , Committee on Appropriations, U.S. Senate, 115th Cong., 2nd Sess., June 21, 2018, p. 70, 70, p. June 21, 2018, 2nd Sess., Cong., 115th Senate, U.S. on Appropriations, , Committee United States Contributions to International Organizations: Sixty-Sixth Annual Report to the Congress, Fiscal Year Year Fiscal the Congress, to Annual Report Sixty-Sixth Organizations: International to Contributions States United heritage.org/BlueprintForBalance Blueprint for Balance: United States Contributions to International Organizations: Sixty-Sixth Annual Report to the Congress, Fiscal Year 2017 Year Fiscal the Congress, to Annual Report Sixty-Sixth Organizations: International to Contributions States United , p. 13, https://www.state.gov/documents/organization/287307.pdf (accessed March 28, 2019). March (accessed 13, https://www.state.gov/documents/organization/287307.pdf , p. https://www.whitehouse.gov/briefings-statements/remarks-president-trump-72nd-session-united-nations-general-assembly/ (accessed (accessed https://www.whitehouse.gov/briefings-statements/remarks-president-trump-72nd-session-united-nations-general-assembly/ http://undocs.org/en/A/73/350/Add.1 (accessed March 28, 2019). March (accessed http://undocs.org/en/A/73/350/Add.1 https://www.unfpa.org/frequently-asked-questions#acronym (accessed March 28, 2019). March (accessed https://www.unfpa.org/frequently-asked-questions#acronym 28, 2019). March (accessed https://www.whitehouse.gov/presidential-actions/presidential-memorandum-regarding-mexico-city-policy/ https://www.congress.gov/bill/116th-congress/house-joint-resolution/31 (accessed March 28, 2019). Heritage experts assume that FY 2019 FY 2019 that assume Heritage experts 28, 2019). March (accessed https://www.congress.gov/bill/116th-congress/house-joint-resolution/31 for Fund Nations United “The 28, 2019). March (accessed http://www.aul.org/2010/04/the-kemp-kasten-provision-and-unfpa-funding/ http://dailysignal.com/2010/08/27/why-does-undp-continue-to-aid-repressive-regimes/. https://unfccc.int/news/state-of-palestine-joins-convention (accessed March 28, 2019). March (accessed https://unfccc.int/news/state-of-palestine-joins-convention https://www.congress.gov/115/crpt/srpt282/CRPT-115srpt282.pdf (accessed March 28, 2019). Heritage experts assume that spending holds that assume Heritage experts 2019). 28, March (accessed https://www.congress.gov/115/crpt/srpt282/CRPT-115srpt282.pdf in H.J.Res. 31, Consolidated Appropriations Act, 2019, Public Law 116-9, 116th Cong., February 15, 2019, 2019, 15, February 116th Cong., 116-9, Public Law 2019, Act, Appropriations 31, Consolidated in H.J.Res. March 28, 2019). March March 28, 2019). March Nations Population Fund, reflecting its lead role in the United Nations system in the area of population. The original abbreviation, UNFPA, UNFPA, original abbreviation, The of population. in the area system Nations in the United its lead role reflecting Fund, Population Nations cially renamed the United the United ofcially renamed it was In 1987, in 1969. and began operations fund in 1967 as a trust established was Activities Population March 28, 2019). March March 28, 2019). March Intergovernmental Panel on Climate Change, October 8, 2018, https://www.ipcc.ch/site/assets/uploads/2018/11/pr_181008_P48_spm_en.pdf https://www.ipcc.ch/site/assets/uploads/2018/11/pr_181008_P48_spm_en.pdf 2018, 8, October Change, Climate on Panel Intergovernmental United Nations General Assembly,” The White House, September 19, 2017, 2017, 19, September House, White The Assembly,” General Nations United this spending level holds steady through FY 2020. The projected shares come from Addendum to Report of the Secretary-General, of the Secretary-General, Report to Addendum from come shares projected The FY 2020. through holds steady this spending level ective.” 22 U.S. 22 U.S. ective.” is ef period in which such membership during any of statehood, attributes recognized the internationally have does not that peacekeeping assessment is 27.8912 percent for 2019 and 27.8908 percent for 2020 and 2021. In addition, the U.N. peacekeeping budget budget peacekeeping In addition, the U.N. and 2021. 2020 for percent and 27.8908 2019 for percent is 27.8912 assessment peacekeeping State, State, approved U.N. Peacekeeping budget was $6.691 billion for July 1, 2018, to June 30, 2019, as found in United Nations General Assembly, Assembly, General Nations in United as found 2019, 30, June to July 1, 2018, billion for $6.691 was budget Peacekeeping U.N. approved was retained.” United Nations Population Fund, “Frequently Asked Questions: What Does UNFPA Stand For?” last updated January 2018, January 2018, updated last For?” Stand Does UNFPA What Questions: Asked “Frequently Fund, Population Nations United retained.” was and xiv, https://papersmart.unmeetings.org/media2/2357248/evaluation_of_undp_contribution_to_poverty_reduction.pdf (accessed (accessed https://papersmart.unmeetings.org/media2/2357248/evaluation_of_undp_contribution_to_poverty_reduction.pdf and xiv, Committee Agenda, Item 149, July 5, 2018, http://undocs.org/A/c.5/72/25 (accessed March 28, 2019). Heritage experts assume that that assume Heritage experts 28, 2019). March (accessed http://undocs.org/A/c.5/72/25 2018, July 5, 149, Item Agenda, Committee Code § 287e, https://www.law.cornell.edu/uscode/text/22/287e (accessed March 28, 2019). March (accessed https://www.law.cornell.edu/uscode/text/22/287e § 287e, Code sections/goatsandsoda/2017/04/04/522040557/citing-abortions-in-china-trump-cuts-funds-for-u-n-family-planning-agency (accessed (accessed sections/goatsandsoda/2017/04/04/522040557/citing-abortions-in-china-trump-cuts-funds-for-u-n-family-planning-agency spending remains constant in FY 2020. in FY constant spending remains steady through FY 2020. through steady can fluctuate within each three-year scale and also when new scales are adopted using updated economic data. For instance, the U.S. the U.S. instance, For data. economic using updated adopted scales are scale and also when new within each three-year can fluctuate or closed. contracted, expanded, are missions or existing established are missions as new can change significantly or (2) to the United Nations, if the United Nations grants full membership as a state in the United Nations to any organization or group or group organization any to Nations in the United a state as full membership grants Nations if the United Nations, the United or (2) to grants full membership as a state to any organization or group that does not have the internationally recognized attributes of statehood, of statehood, attributes recognized the internationally does not have that or group organization any to as a state full membership grants and Related Programs Appropriations Bill, 2019 Appropriations Programs and Related 2018. The U.S. withdrew from UNESCO at the end of 2018. at UNESCO from withdrew U.S. The 2018. (accessed March 28, 2019). March (accessed Brett Schaefer, “Why Does UNDP Continue to Aid Repressive Regimes?” The Daily Signal, August 27, 2010, 2010, 27, Daily Signal, August The Regimes?” Aid Repressive to Does UNDP Continue “Why Schaefer, Brett Savings of $10 million in FY 2020 are based on recommended contributions in Report No. 115-282, 115-282, No. in Report contributions based on recommended are in FY 2020 million of $10 Savings Estimated savings of $359 million for FY 2020 are based on contributions by the United States in FY 2017 as reported in U.S. Department of Department in U.S. as reported in FY 2017 States the United by based on contributions are FY 2020 million for of $359 savings Estimated Donald J. Trump, “Remarks by President Trump to the 72nd Session of the Session the 72nd to Trump President by “Remarks Trump, Donald J. Estimated savings of $193 million for FY 2020 are based on reducing the U.S. share of funding from 27.8912 percent to 25 percent. The The 25 percent. to percent 27.8912 of funding from share the U.S. based on reducing are FY 2020 million for of $193 savings Estimated U.S. Department of State, of State, Department U.S. https://www.npr.org/ 2017, NPR, April 4, Planning Agency,” Family U.N. for Cuts Funds Abortions in China, Trump “Citing Nurith Aizenman, Estimated savings of $32.5 million for FY 2020 are based on the FY 2019 appropriated level as specified level appropriated based on the FY 2019 are FY 2020 million for of $32.5 savings Estimated The U.S. peacekeeping assessment is established in three-year sets, the most recent being for 2019–2021. The specific assessment specific assessment The 2019–2021. being for recent the most sets, in three-year is established assessment peacekeeping U.S. The Donald J. Trump, “Presidential Memorandum Regarding the Mexico City Policy,” The White House, January 23, 2017, January 23, 2017, House, White The Policy,” City Mexico the Regarding Memorandum “Presidential Trump, Donald J. Daniel Briggs, “The Kemp–Kasten Provision and UNFPA Funding,” Americans United for Life, April 23, 2010, April 23, 2010, Life, for Americans United Funding,” and UNFPA Provision Kemp–Kasten Daniel Briggs, “The Savings of $80 million in FY 2020 are based on recommended contributions in Senate Report No. 115-281, 115-281, No. Report in Senate contributions based on recommended are of $80 million in FY 2020 Savings Announcement, “State of Palestine Joins Convention,” United Nations Climate Change, March 15, 2016, 2016, 15, March Change, Climate Nations United Joins Convention,” of Palestine “State Announcement, through full membership the Palestinians granted when UNESCO 2011 from UNESCO funding from withhold to led the U.S. prohibition This Press release, “Summary for Policymakers of IPCC Special Report on Global Warming of 1.50 C. Approved by Governments,” Governments,” by C. Approved of 1.50 on Global Warming Special Report of IPCC Policymakers “Summary for release, Press (accessed https://www.ipcc.ch/ Change: Reports,” on Climate Panel Intergovernmental “The Change, on Climate Panel Intergovernmental which Nations of the United organization afliated any (1) to contribution: or assessed voluntary any make shall not States United “The ce, Ofce, Evaluation Programme, Development Nations United Operations, and Related Programs Appropriations Bill, 2019 Appropriations Programs and Related Operations, 2017 “Implementation of General Assembly Resolutions 55/235 and 55/236,” A/73/350/Add.1, 73rd Sess., Agenda Item 149, December 24, 2018, 2018, 24, December 149, Item Agenda Sess., 73rd A/73/350/Add.1, 55/236,” and 55/235 Resolutions Assembly of General “Implementation “Approved Resources for Peacekeeping Operations for the Period from 1 July 2018 to 30 June 2019,” A/C.5/72/25, 72nd Sess., Fifth Sess., 72nd A/C.5/72/25, 30 June 2019,” to 1 July 2018 from the Period for Operations Peacekeeping for Resources “Approved

8. 5. 6. 9. ENDNOTES 18. 17. 16. 15. 14. 12. 13. 11. 10. 1. The Heritage Foundation | 2. 3. 7. 4. SFOPS 38. 37. 36. 35. 34. 33. 32. 31. 30. 288 28. 27. 26. 25. 24. 23. 22. 21. 20. 29. 19. | Foundation Heritage The

Appropriations Act, 2019. Heritageexperts assume that FY2019 spendingremains constant inFY2020. Appropriations Act, 2019. Heritageexperts assume that FY2019 spendingremains constant inFY2020. 2017 U.S. Department ofState, Estimated savings of $52.5 millionfor FY2020 are basedonproposed reforms reported inRoberts andSchaefer, “An Overhaul ofAmerica’s Estimated savings of $1 billionfor FY2020 are basedonproposed reforms reported inJamesM.Roberts andBrett D. Schaefer, “An Ofce ofManagement andBudget, FiscalYear 2019 Budget oftheU.S. Government, p. 84, Estimated savings of $160 millionfor FY2020 represents acalculation ofthecost ofoperating the15smallest USAID Estimated savings of $750 millionfor FY2020 are basedonproposed reforms reported inRoberts andSchaefer, “An Overhaul ofAmerica’s Bryan Riley andAnthony B. Kim,“Freedom to Trade: AGuidefor Policymakers,” HeritageFoundation Brett D. Schaefer, “U.S. ShouldDemandIncreased Transparency andAccountability as S. 1635, Department ofState Authorities Act, FiscalYear 2017, Law Public 114-323, 114thCong., December 16,2016, Heather Nauert,Press Statement, “On U.S. Assistance to UNRWA,” U.S. Department ofState, August 31,2018, Global Environment Facility, “Projects,” https://www.thegef.org/projects (accessed March 28,2019). Lisa Elges and Claire Martin, See, for example, GlobalEnvironment Facility, “About Us,” https://www.thegef.org/about-us (accessed March 28, 2019, andGlobal Estimated savings of$140 millionfor FY2020 are basedontheFY2019 appropriated level asspecifiedinH.J.Res. 31,Consolidated U.S. Trade andDevelopment Agency, “Our Mission,” http://www.ustda.gov/about/mission (accessed March 28,2016). Estimated savings of$79.5 millionfor FY2020 are basedontheFY2019 appropriated level asspecifiedinH.J.Res. 31,Consolidated Chris Edwards andDanielJ. Mitchell, Organisation for Economic Co-operation andDevelopment, “About theOECD: OurMission,” https://www.oecd.org/about/ (accessed March Ibid. Calculation basedonthefollowing information provided to Heritageanalysts by theOECD onFebruary 4, 2019: “In2016, theassessed 2014, https://www.transparency.org/whatwedo/publication/protecting_climate_finance_adaptation_fund (accessed March 28,2019). 28, 2019). contributions from theUnited States were 20.5 percent oftheOECD’s core (i.e. assessed) budget. Ofthetotal core contributions budget Overhaul ofAmerica’s Foreign Assistance Programs IsLong Overdue,” HeritageFoundation October 20, 2015, http://thf-reports.s3.amazonaws.com/2015/BG3064.pdf. and Oversight asreported inU.S. Agency for International Development, we includeonlyaportionofthosesavings that caneasilybeestimated. Heritageexperts assume that FY2019 spendingremains constant in mission around theworld, whichis15percent oftheapproximately $1.070 billionFY2018 budget for Program Development million isapproximately equalto million. €6.3 that year, atotal of3.2percent—EUR from 6.3M allcountries combined—was dedicated to theorganization’s work ontaxation.” USD$1.5 U.N. Revenues Rise,” HeritageFoundation Institute, 2008),p. 148. Foreign Assistance Programs IsLong Overdue.” Heritageexperts assume that FY2019 spendingremains constant inFY2020. Foreign Assistance Programs IsLong Overdue.” Heritageexperts assume that FY2019 spendingremains constant inFY2020. FY 2020. Environment Facility, “Conventions,” https://www.thegef.org/partners/conventions (accessed March 28,2019). https://www.whitehouse.gov/wp-content/uploads/2018/02/budget-fy2019.pdf (accessed March 28,2019). https://www.heritage.org/report/us-should-demand-increased-transparency-and-accountability-un-revenues-rise. https://www.congress.gov/bill/114th-congress/senate-bill/1635/text (accessed March 28,2019). https://www.usaid.gov/sites/default/files/documents/1868/USAIDFY2018AFR_508R.pdf (accessed March 28,2019). https://www.heritage.org/sites/default/files/2017-09/BG3247.pdf. Althoughacomprehensive overhaul would generate substantial savings, https://www.state.gov/r/pa/prs/ps/2018/08/285648.htm (accessed March 28,2019). , p. 5. Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance United States Contributions to International Organizations: Sixty-Sixth AnnualReport to theCongress, Fiscal Year Protecting Climate Finance: An Anti-Corruption Assessment of the Adaptation Fund Global Tax Revolution: The Rise of Tax Competition to andtheBattle Defend It Issue Brief A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A No. 4154, February 26, 2014, Agency FinancialReport: Fiscal Year 2018 Backgrounder Backgrounder No. 3247, September 19, 2017, , Transparency International, , p. 33, (Washington: Cato No. 3064, Transportation, Housing and Urban Development, and Related Agencies The Heritage Foundation | heritage.org/BlueprintForBalance $317 MIXED SAVINGS IN MILLIONS1

Eliminate the Transportation Department’s Essential Air Service Program The EAS was established in 1978 as a temporary and planes on nearly one-third of the routes are at program to provide subsidies to rural airports fol- least two-thirds empty. For example, the EAS pro- lowing deregulation of the airline industry. Despite vides $2.5 million annually to continue near-empty the original intention that it would be a temporary daily flights in and out of Lancaster, Pennsylvania, program, the EAS still provides millions of dollars even though travelers have access to a major airport in subsidies to these airports. In fact, spending (Harrisburg) just 40 miles away. To remain on the on the EAS has increased faster than inflation by dole, airports served by the EAS must serve no more orders of magnitude since 1996 despite the fact that than an average of 10 passengers per day. commuters on subsidized routes could be served by other existing modes of transportation such as The federal government should not engage in mar- intercity buses. ket-distorting and wasteful activities like the EAS. If certain routes are to be subsidized, they should The EAS squanders federal funds on flights that are be overseen by state or local authorities, not by the often empty: EAS flights typically are only half full, federal government.

ADDITIONAL READING " Justin Bogie, Norbert J. Michel, and Michael Sargent, “Senate Bill Should Cut Wasteful Programs and Provide Long- Term Sustainability for Highway Programs,” Heritage Foundation Issue Brief No. 4566, May 18, 2016. " Eli Lehrer, “EAS a Complete Waste of Taxpayer Money,” Heartland Institute, undated.

PROPOSAL STATUS EXPLANATION

PARTIALLY Reduces spending by $50 million from FY 2019 levels President’s Budget (FY2020) INCLUDED for the discretionary portion of EAS.

THUD 290 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $162 DISCRETIONARY SAVINGS IN MILLIONS2

Eliminate the Appalachian Regional Commission

The Appalachian Regional Commission was estab- federal funding to a concentrated group of 13 states lished in 1965 as part of President Lyndon Johnson’s where funds are further earmarked for speciﬁc proj- Great Society agenda. The commission duplicates ects at the community level. highway and infrastructure construction under the Department of Transportation’s highway program If states and localities see the need for increased in addition to diverting federal funding to projects spending in these areas, they should be responsible of questionable merit, such as those meant to sup- for funding it themselves. This duplicative carve-out port “development and stimulation of indigenous should be eliminated. arts and crafts of the region.”3 The program directs

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at FY 2019 levels. THUD

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 291 The Heritage Foundation | heritage.org/BlueprintForBalance $150 DISCRETIONARY SAVINGS IN MILLIONS4

Eliminate Subsidies for the Washington Metropolitan Area Transit Authority The WMATA is Washington, D.C.’s local transit largely due to Metro’s exorbitant costs: The rail authority and the only transit authority to receive system is the most expensive to operate per passen- direct appropriations from Congress. ger mile of any of the major urban rail systems and has more employees than any other system when Federal subsidies for the WMATA decrease incen- adjusted for ridership. tives for the transit agency to control costs, optimize service routes, and set proper priorities for main- Federal subsidies for the WMATA have masked tenance and updates. Metrorail ridership has fallen Metro’s shortcomings and allowed it to reach its every year since 2009, including a decline of 13 current dilapidated state with few consequences. percent from 2016 to 2017. Instead of ﬁxing its manifold issues, the WMATA’s strategy has been to demand more money from fed- Ridership and safety issues come to the fore as eral taxpayers, many of whom will likely never use Metro’s ﬁnancial picture looks increasingly grim. the system. Congress should eliminate subsidies to The agency’s budget projection for 2020 shows that the WMATA and allow market incentives to turn the fares and parking fees cover only 21 percent of costs, WMATA into a more efective transit agency. requiring huge local and federal subsidies. This is

ADDITIONAL READING " Michael Sargent, “Death Spiral or Not, Washington’s Metro Is a Total Disaster,” National Interest, November 4, 2016. " Ronald D. Utt, “Washington Metro Needs Reform, Not a Federal Bailout,” Heritage Foundation WebMemo No. 1665, October 16, 2007.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED Maintains funding at FY 2019 levels.

THUD 292 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $397 DISCRETIONARY SAVINGS IN MILLIONS5

Eliminate Grants to the National Rail Passenger Service Corporation (Amtrak) The National Railroad Passenger Corporation, Congress should eliminate Amtrak’s operating sub- now known as Amtrak, was created by the federal sidies in FY 2020 and phase out its capital subsidies government to take over bankrupt private passen- over five years to give Amtrak’s management time ger rail companies. In FY 2018, it received grants to modify business plans, work more closely with totaling more than $1.9 billion. the private sector, reduce labor costs, and eliminate money-losing lines. Simultaneously, the Secretary Amtrak is characterized by an unsustainable of Transportation should generate a proposal to financial situation and management that, because privatize Amtrak’s profitable routes and turn over it is hamstrung by unions and federal regulations, responsibilities for state-supported routes to the has failed to improve performance and service for states. During this phaseout, Congress should repeal customers. Amtrak’s monopoly on passenger rail Amtrak’s monopoly on passenger rail service and service stifles competition that could lower costs allow private companies to enter the market and for passengers. Labor costs, driven by the generous provide passenger rail service where they see a wages and benefits required by union labor agree- viable commercial market. ments, constitute half of Amtrak’s operating costs. Amtrak trains are notoriously behind schedule, as evidenced by poor on-time performance rates.

ADDITIONAL READING " Tad DeHaven, “Downsizing the Federal Government: Privatizing Amtrak,” Cato Institute, June 2010. " Ronald D. Utt, “Chairman Mica’s New Amtrak Proposal Would Use the Private Sector to Reform Passenger Rail,” Heritage Foundation WebMemo No. 3290, June 13, 2011.

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending by $1 billion from FY 2019 levels. INCLUDED THUD

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 293 The Heritage Foundation | heritage.org/BlueprintForBalance $815 DISCRETIONARY SAVINGS IN MILLIONS6

Close Down the Transportation Department’s Maritime Administration and Repeal the Maritime Jones Act MARAD was created in 1950, and its purpose is to Jones Act, established in 1920, requires unreason- maintain a maritime fleet that can be used during a able and overly burdensome standards: Any cargo national emergency. Decades later, it continues to (or persons) shipped between two U.S. cities must oversee and implement duplicative and crony laws be on a U.S.-built and U.S.-flagged vessel with at least that benefit special interests. 75 percent of its crew from the U.S.

MARAD and the laws it implements are steeped Congress should close down the Maritime Admin- in protectionism and subsidies. For example, its istration and transfer its international regulatory subsidies to small shipyards are a taxpayer-funded roles to another agency. The federal government handout to politically favored ﬁrms that may not be should sell the government-owned ships in the efcient or competitive. MARAD further provides Defense Ready Reserve Fleet and transfer funding taxpayer-backed loan guarantees for companies to for this program to the Department of Defense. hire U.S. shipbuilders under its Maritime Guaran- Simultaneously, Congress should repeal the teed Loan (Title XI) Program—another handout to maritime Jones Act and MARAD’s wasteful sub- politically connected entities. Finally, the maritime sidy programs.

ADDITIONAL READING " Wendell Cox and Ronald D. Utt, “How to Close Down the Department of Transportation,” Heritage Foundation Backgrounder No. 1048, August 17, 1995. " Brian Slattery, Bryan Riley, and Nicolas D. Loris, “Sink the Jones Act: Restoring America’s Competitive Advantage in Maritime-Related Industries,” Heritage Foundation Backgrounder No. 2886, May 22, 2014.

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending. INCLUDED

THUD 294 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $2.6 DISCRETIONARY SAVINGS IN BILLIONS7

Eliminate the Transportation Department’s Capital Investment Grants

Capital Investment Grants were created in 1991 as when a streetcar receives a Capital Investment as part of the Intermodal Surface Transportation Grant, the project will increase trafc congestion by Efciency Act with the purpose of giving transit blocking a lane and slowing down cars. These proj- agencies grants for new transit projects. Because ects are perennially over budget. A review of federal New Starts is a competitive grant program that studies examining 15 projects that were completed funds only novel transit projects, not maintenance shows that the projects were over budget by nearly of existing systems, it gives localities the incentive 30 percent on average. Worse, the costs of these to build costly and unnecessary transit systems that expensive rail projects tend to divert funding from they can ill aford to operate and maintain instead of more practical services, such as buses needed by devoting their resources to the proper maintenance low-income residents. of existing infrastructure. Congress should terminate funding for Capital Criteria for eligible projects include “congestion Investment Grants and allow the states and the relief,” “environmental beneﬁts,” and “economic private sector to manage and fund transit systems development efects” but (tellingly) no longer where they are truly efective. include “operating efciencies.”8 In some cases, such

ADDITIONAL READING " Randal O’Toole, “‘Paint Is Cheaper Than Rails’: Why Congress Should Abolish New Starts,” Cato Institute Policy Analysis No. 727, June 19, 2013. " Randal O’Toole, Cato Institute, testimony before the Subcommittee on Highways and Transit, Committee on Transportation and Infrastructure, U.S. House of Representatives, December 11, 2013.

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending by $1.048 billion from FY 2019 levels. INCLUDED THUD

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 295 The Heritage Foundation | heritage.org/BlueprintForBalance $36 DISCRETIONARY SAVINGS IN MILLIONS9

Privatize the Transportation Department’s Saint Lawrence Seaway Development Corporation Created through the Wiley–Dondero Act of 1954, in 1998, eliminating any future taxpayer funding the SLSDC is a government-owned entity charged for its maintenance and operation activities. Pri- with maintaining and operating the part of the Saint vatization of this kind in the U.S. would encourage Lawrence Seaway that is within United States terri- productivity and competitiveness and reduce the tory. The seaway opened in 1959. Canada, which also burden on taxpayers. Congress should follow Cana- borders the seaway, privatized its agency equivalent da’s example and privatize the SLSDC.

ADDITIONAL READING " Chris Edwards, “Downsizing the Federal Government: Department of Transportation Timeline,” Cato Institute, undated. " Justin Bogie, Norbert J. Michel, and Michael Sargent, “Senate Bill Should Cut Wasteful Programs and Provide Long- Term Sustainability for Highway Programs,” Heritage Foundation Issue Brief No. 4566, May 18, 2016.

PROPOSAL STATUS EXPLANATION

Reduces spending by $12 million from FY 2019 levels; no President’s Budget (FY2020) REJECTED privatization.

THUD 296 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $900 DISCRETIONARY SAVINGS IN MILLIONS10

Eliminate the National Infrastructure Investment (TIGER) Program

The National Infrastructure Investment Program in Detroit, Michigan. TIGER grants amount to provides competitive grants administered by the “administrative earmarks” because federal bureau- U.S. Department of Transportation. It began as part crats (prodded by powerful Members of Congress) of the 2009 stimulus bill and was intended to be a choose the criteria that a project must meet and in temporary program to fund road, rail, transit, and turn decide which projects will receive grants. That port projects in the national interest. Eight years gives cities perverse incentives to pander to Wash- later, this “temporary” program has proven too ington, asking for federal money for projects they tempting a spending opportunity for Congress and may not need just to keep another city or state from the Administration to give up and has remained a receiving the funds. permanent ﬁxture. The TIGER grant program creates perverse Through the TIGER program, Washington sends incentives for localities, duplicates state and local federal dollars to pay for projects that clearly fall transportation agency programs, and squanders under the purview of local government and serve federal resources on local projects that have little no stated federal objective. Past projects include to do with interstate commerce. These projects a $16 million, six-mile pedestrian mall in Fresno, should be funded by the local communities that California; a $14.5 million “Downtown Promenade” beneﬁt from them. Congress should eliminate the in Akron, Ohio; and a $27.5 million streetcar line TIGER program.

ADDITIONAL READING " Baruch Feigenbaum, “Evaluating and Improving TIGER Grants,” Reason Foundation Policy Brief No. 99, April 2012.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) REJECTED More than doubles spending compared to levels. THUD

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 297 The Heritage Foundation | heritage.org/BlueprintForBalance $3.5 MANDATORY SAVINGS IN BILLIONS11

Eliminate the Transportation Department’s Airport Improvement Program and Reform Airport Funding The AIP provides federal grants for capital improve- grants. Noncommercial airports, which serve less ments at public-use airports. The grants are funded than 1 percent of commercial fliers and thus con- primarily by federal taxes on passenger airline tribute a trivial share of revenue, receive about 30 tickets and other aviation activities. AIP grants can percent of AIP grants. be used only for certain types of “airside” capital improvements, such as runways and taxiways, and Instead of continuing this redistributive scheme, are tied to strict regulations that govern how air- Congress should eliminate the AIP, reduce pas- ports can operate. senger ticket taxes, and reform federal regulations that prohibit airports from charging market prices The AIP functions as a middleman, redistributing for their services. These reforms would eradicate fliers’ resources from the most significant airports the inefcient and inequitable distribution of to those of far less importance. For example, the 60 flier resources and allow airports to fund capital largest airports in the U.S. serve nearly 90 percent of improvements in a local, self-reliant, and free-mar- air travelers and have the greatest need for capital ket manner. investment, yet they receive only 27 percent of AIP

ADDITIONAL READING " Michael Sargent, “End of the Runway: Rethinking the Airport Improvement Program and the Federal Role in Airport Funding,” Heritage Foundation Backgrounder No. 3170, November 23, 2016.

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending by $1 billion from FY 2019 levels. INCLUDED

THUD 298 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $1.98 MANDATORY SAVINGS IN BILLIONS12

Phase Out the Transportation Department’s Federal Transit Administration Created in 1964, the Federal Transit Administra- activities. Even worse, federal transit grants give tion provides grants to state and local governments localities perverse incentives to build new tran- and transit authorities to operate, maintain, and sit routes while neglecting maintenance of their improve transit systems such as buses and subways. existing systems and other infrastructure. Transit is inherently local in nature and should therefore be The federal government began to use federal gaso- funded at the local or regional level. line taxes, which drivers pay into the Highway Trust Fund (HTF), to support transit in 1983. The tran- The federal government should phase out the sit diversion within the HTF accounts for nearly Federal Transit Administration over ﬁve years by one-ﬁfth of HTF spending. The reasons for funding reducing federal transit funding by 20 percent per transit were to ofer mobility to low-income citizens year and simultaneously reducing the FTA’s oper- in metropolitan areas, reduce greenhouse gas emis- ating budget by the same proportion. Phasing out sions, and relieve trafc congestion. Despite billions the program would give state and local governments of dollars in subsidies, however, transit has largely time to evaluate the appropriate role of transit in failed in all of these areas. their jurisdictions and an incentive to adopt policy changes that improve their transit systems’ cost-ef- When it issues grants for streetcars, subways, and fectiveness and performance. buses, the FTA is subsidizing purely local or regional

ADDITIONAL READING " Wendell Cox, “Transit Policy in an Era of the Shrinking Federal Dollar,” Heritage Foundation Backgrounder No. 2763, January 31, 2013.

PROPOSAL STATUS EXPLANATION

PARTIALLY President’s Budget (FY2020) Reduces spending by $1.064 billion from FY 2019 levels. INCLUDED THUD

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 299 The Heritage Foundation | heritage.org/BlueprintForBalance $273 MANDATORY SAVINGS IN MILLIONS13

Eliminate Allocations to the Housing Trust Fund and Capital Magnet Fund Allocations to the Housing Trust Fund (adminis- taxpayer expense. Even if funds flowed directly from tered by HUD’s Assistant Secretary for Community the government to recipients, this would be a con- Planning and Development) and Capital Magnet cern. The manner in which these programs operate Fund (administered by the Treasury Department’s compounds the problem. The federal government Community Development Financial Institutions transmits the funds through intermediaries (includ- Fund) ultimately benefit favored housing devel- ing state governments) to the ultimate recipients, opments and services desired by special interests. reducing transparency and accountability in the Accountability, transparency, and efciency also process. Often, those recipients are real estate pose significant concerns. These afordable hous- developers or investment property owners. ing funds are unnecessary, enrich the politically connected at taxpayer expense, and expand the Afordability concerns are best addressed by government’s harmful interference in the hous- reforming local land use regulations, eliminating ing market. rent control, and making it easier for landlords to evict non-paying tenants. Ending contributions Furthermore, the approval process ensures that to these funds as well as the fees levied to support politically connected entities are enriched at these funds would save $273 million in FY 2020.

ADDITIONAL READING " Norbert J. Michel and John L. Ligon, “GSE Reform: Trust Funds or Slush Funds?” Heritage Foundation Backgrounder No. 4080, November 7, 2013.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED

THUD 300 Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 The Heritage Foundation | heritage.org/BlueprintForBalance $1.6 DISCRETIONARY SAVINGS IN BILLIONS14

Eliminate the Home Equity Conversion Mortgage Program

A homeowner can arrange with a lender to receive issued on properties with a substantial level of a set amount of monthly revenue over an extended equity, these loans are far less risky than standard period of time through a reverse mortgage based on high loan-to-value mortgages. the equity in the house. Each month, the cash ﬂow from the lender to the homeowner, along with the The Federal Housing Authority within HUD oper- interest payable, is simply added to the mortgage ates a Home Equity Conversion Mortgage Program owed on the homes. Many retirees use this method (HECM) that guarantees reverse mortgages issued to supplement other retirement income. This allows by private lenders. The CBO estimates savings of up even retirees with minimal liquid assets to live com- to $6.9 billion over 10 years by making loans directly fortably without being forced to downsize. to borrowers rather than guaranteeing those issued by private lenders.15 A better option is to discon- In a traditional mortgage, home equity grows as the tinue the HECM program altogether, providing value of the home increases and principal is paid neither reverse mortgage loans nor guarantees. The down. With a reverse mortgage, the opposite occurs: private sector is well equipped to service the reverse

Home equity typically shrinks as interest payable mortgage market in a way that would enable retir- and principal balance grow in excess of property ees to remain in their homes while drawing down appreciation. Because reverse mortgages are often on equity.

PROPOSAL STATUS EXPLANATION

President’s Budget (FY2020) INCLUDED THUD

Blueprint for Balance: A FEDERAL BUDGET FOR FISCAL YEAR 2020 301 THUD 302 The Heritage Foundation | Foundation Heritage The picture oftheshortcomingscurrentpractice. should scrutinizeallpossiblefactors, fromindustry practicestogovernment regulation,toprovide aclear Ofcetoexamineanddetermine thereasonsfortheseexcessiveAccountability construction costs. TheGAO those inpeercountries, especiallywithregardtomegaprojects. CongressshouldrequiretheGovernment United States. Request theGovernment Ofcetoexamine Accountability infrastructure construction costs inthe with consistent dataregardingthefederalgovernment’s activitiesinsubsidizingtransportation. modes oftransportation.Reproducingthestudy onaperiodicbasiswouldprovide lawmakers andtravelers and thetraveling publicwithoutdatedinformationabouthow federalsubsidiesaredistributed among comparable metrics. Since2004,however, the DOThasnot updatedthereport,leaving most policymakers federal subsidiestargetedtorail,transit,air, andhighway travelers since1990andpresentedthemusing transportation.Thereportdetailedreport thatassessedthefederalsubsidiestopassenger theamountof various modesoftransportation.In2004,theDOT’s BureauofTransportationStatistics produceda transportation. Require theDepartmentofTransportation tostudy total federalsubsidiestopassenger quality, andlessexpensive components. bureaucratic andprotectionist mandatewouldgive U.S. infrastructure accesstomorenumerous, better- canapplyforawaiver.entire projectby upto25percentbefore theprojectagency Endingorwaiving this expensive asthosemadeinJapan. Overall, BuyAmericaprovisions areallowed toincrease thecost ofan percent inthecaseofChinese-madesteel. Inaddition,busesmadeintheU.S. werefoundtobetwiceas in recentyearshascost morethansteel madeinWestern EuropeorChina—apriceincreaseofroughly30 which oftenleadstohighercosts forprojects. BuyAmericarequirestheuseofAmerican-madesteel, which States. Thisprotectionist mandatelimitsselectionandpricecompetition amonginputmanufacturers, “Buy America”mandates, which requirethatcertaininputcomponentsmust bemanufacturedin theUnited Eliminate “BuyAmerica”restrictions. Bacon andPLAswouldsave morethan$100billionover thenext 10yearsundercurrentspendinglevels. estimate Davis–Bacon sothattheymorecloselyreflectmarket “prevailingwages” pay. EliminatingDavis– the appropriationsbillorrequireLaborDepartmenttousesuperiorBureauofStatistics datato increase spendinglevels. Barringcomplete repeal,Congresscouldsuspendtheruleforprojectsfundedby PLAs wouldstretch eachfederalconstruction dollar, delivering moreinfrastructure withouttheneedto the 87percentofworkers whoarenot membersofaunion.EliminatingDavis–Bacon andprohibiting by 12percentto18ontopofincreasedcosts attributed toDavis–Bacon anddiscriminateagainst all workers onfederallycontractedprojectsthroughunionhiringhalls. PLAsinflateconstruction costs bargaining agreementsrequireusingunioncompensation rates, following unionworkrules, andhiring contracts tosignacollective bargainingagreementasaconditionofwinningprojectbid.Collective percent onaverage. Similarly, projectlaboragreements(PLAs)requirethemaincontractorofgovernment benefit scalesandfollow unionworkrules. Theserulesinflatethecost offederalconstruction by nearly10 enactedin1931,efectively requiresconstruction and Act, contractorsonfederalprojectstouseunionwage Eliminate orrollbackDavis–Bacon requirementsandprojectlaboragreements. POLICY RIDERS Data andrecentreportsindicatethatinfrastructure construction costs intheU.S. exceed Congress shouldrecommissionthe2004study thatdetailed thefederalsubsidiesto Blueprint for Balance: Blueprint for heritage.org/BlueprintForBalance A FEDERAL BUDGET FOR FISCAL YEAR 2020 YEAR FISCAL FOR BUDGET FEDERAL A Most federallyfundedinfrastructure projectsmust complywith The Davis–Bacon THUD

303 Fiscal Fiscal No. 727, June 19, 2013, 2013, 19, June 727, No. Policy Analysis , December 2018, p. 311, p. 2018, , December A FEDERAL BUDGET FOR FISCAL YEAR 2020 Options for Reducing the Deficit: 2019–2028 Reducing Options for , November 10, 2017, https://www.hud.gov/sites/dfiles/Housing/documents/ActuarialMMIFHECM2017.pdf https://www.hud.gov/sites/dfiles/Housing/documents/ActuarialMMIFHECM2017.pdf 2017, 10, , November heritage.org/BlueprintForBalance Blueprint for Balance: https://www.cbo.gov/system/files?file=2018-12/54667-budgetoptions.pdf (accessed March 14, 2019). The CBO notes that HECM program program HECM that notes CBO The 2019). 14, March (accessed https://www.cbo.gov/system/files?file=2018-12/54667-budgetoptions.pdf http://www.cato.org/publications/policy-analysis/paint-cheaper-rails-why-congress-should-abolish-new-starts (accessed March 14, 2018). March (accessed http://www.cato.org/publications/policy-analysis/paint-cheaper-rails-why-congress-should-abolish-new-starts spending. mandatory represents billion in savings https://www.congress.gov/search?q=%7B%22source%22:%22legislation%22,%22search%22:%22cite:PL115-244%22%7D (accessed March March (accessed https://www.congress.gov/search?q=%7B%22source%22:%22legislation%22,%22search%22:%22cite:PL115-244%22%7D https://www.cbo.gov/about/products/budget-economic-data#9 (accessed April 1, 2019). The mandatory savings include payments to the to payments include savings mandatory The April 1, 2019). (accessed https://www.cbo.gov/about/products/budget-economic-data#9 https://www.congress.gov/bill/116th-congress/house-joint-resolution/31 (accessed March 12, 2019), and $142 million in mandatory million in mandatory $142 and 12, 2019), March (accessed https://www.congress.gov/bill/116th-congress/house-joint-resolution/31 in H.J.Res. 31, Consolidated Appropriations Act, 2019. Heritage experts assume that FY 2019 spending remains constant in FY 2020. All $3.5 2020. in FY constant spending remains FY 2019 that assume Heritage experts 2019. Act, Appropriations 31, Consolidated in H.J.Res. levels, and Heritage experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains 2019 FY that assume and Heritage experts levels, level as specified in H.J.Res. 31, Consolidated Appropriations Act, 2019, Public Law 116-6, 116th Cong., February 15, 2019, 2019, 15, February 116-6, 116th Cong., Public Law 2019, Act, Appropriations 31, Consolidated as specified in H.J.Res. level ce, Ofce, Budget in Congressional Program,” Department of Housing and Urban Development estimated shortfalls in the Home Equity Conversion Mortgage Program. HUD estimates HUD estimates Program. Mortgage Conversion in the Home Equity shortfalls estimated of Housing and Urban Development Department Budget Account,” January 2019. Savings include $139 million in projected operating subsidies. Operating subsidies are assumed to be 21 be to assumed subsidies are subsidies. Operating operating million in projected include $139 Savings January 2019. Account,” Budget Budget and Economic Outlook: 2019 to 2029: Budget and Economic Data: Spending Projections, by Budget Account,” January 2019, 2019, January Account,” Budget by Projections, Spending Data: and Economic Budget 2029: to Outlook: 2019 and Economic Budget enacted on FY 2019 based are estimates savings discretionary The 2020. FY for Fund Airport Improvement and Rural Air Service Essential take into account new liabilities spread out over the lifetime of the program. the lifetime out over liabilities spread new account into take that from 2009–2017, losses to HECM guaranteed mortgages exceeded revenues by $14.2 billion. See Pinnacle Actuarial Resources, Resources, billion. See Pinnacle Actuarial $14.2 by revenues exceeded mortgages guaranteed HECM to losses 2009–2017, from that the total FY 2019 appropriated level as specified in H.J.Res. 31, Consolidated Appropriations Act, 2019. Savings exclude the $300 million exclude Savings 2019. Act, Appropriations 31, Consolidated as specified in H.J.Res. level appropriated FY 2019 the total $273 million in savings represents mandatory spending. mandatory represents million in savings $273 reduction in the total appropriations of $9.9 billion for FY 2019 based on a five-year phaseout beginning in 2020. All $1.98 billion in savings billion in savings All $1.98 phaseout beginning in 2020. on a five-year based FY 2019 billion for of $9.9 appropriations in the total reduction spending. mandatory represents percent (the ratio observed under the previous accounting system that divided funding between operating subsidies and grants for capital for and grants subsidies operating divided funding between that system accounting under the previous observed (the ratio percent billion. of $1.29 level in the projected reduction a 20 percent representing capital grants, million in reduced Security. Heritage experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume Heritage experts Security. and debt service) of the $663 million in total FY 2020 funding for the Northeast Corridor and National Network. Savings also include $258 Savings Network. and National Corridor the Northeast for funding FY 2020 million in total of the $663 and debt service) authorized for both the ARC and the Delta Regional Authority, and $3.25 million to be transferred to the ARC from the Federal Aviation Aviation the Federal from the ARC to transferred be million to and $3.25 Authority, and the Delta Regional the ARC both for authorized ce, “The Budget and Economic Outlook: 2019 to 2029: Budget and Economic Data: Spending Projections, by by Spending Projections, Data: and Economic Budget 2029: to Outlook: 2019 and Economic Budget “The Ofce, Budget Congressional Commission. Heritage experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume experts Heritage Commission. airs Appropriations Act, 2019, Public Law 115-244, 115th Cong., September 21, 2018, 2018, 21, September 115th Cong., 115-244, Public Law 2019, Act, Appropriations airs f A Veterans and Construction Mortgage Insurance-In-Force Mortgage 14, 2019). Savings include $155 million appropriated for the Appalachian Regional Commission, as well as half of the $8 million in grants the $8 million in grants as half of as well Commission, Regional the Appalachian for million appropriated include $155 Savings 2019). 14, savings are uncertain and depend on numerous variables. The CBO scores the program as generating profits in some years but does not but in some years profits as generating the program scores CBO The variables. and depend on numerous uncertain are savings ce, “The “The Ofce, Budget Congressional See projections. baseline spending January 2019 recent most based on the CBO’s FY 2020, for savings designated for the Maritime Security Program, which would be transferred to the Department of Defense or Department of Homeland or Department Defense of the Department to be transferred which would Program, the Maritime Security for designated (accessed March 14, 2019). 14, March (accessed (accessed March 14, 2019). 14, March (accessed Estimated savings of $162 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.J.Res. as specified in H.J.Res. level appropriated based on the FY 2019 are FY 2020 million for of $162 savings Estimated Estimated savings of $36 million for FY 2020 are based on the total FY 2019 appropriated level as specified in H.J.Res. 31, Consolidated 31, Consolidated as specified in H.J.Res. level appropriated FY 2019 based on the total are FY 2020 of $36 million for savings Estimated Estimated savings of $317 million for FY 2020 are based on $175 million in discretionary savings, based on the FY 2019 appropriated appropriated on the FY 2019 based savings, in discretionary million based on $175 are FY 2020 of $317 million for savings Estimated Estimated net present value savings of $1.6 billion for FY 2020 are based on incurring new liabilities into the future and previous years’ years’ and previous the future liabilities into new based on incurring are FY 2020 billion for of $1.6 savings value present net Estimated Loan a Direct Into Program Mortgage Conversion the Home Equity Convert A-9, Appendix, “Option Estimated savings of $1.98 billion for FY 2020 are based on the total FY 2019 appropriated level as specified in H.J.Res. 31, Consolidated 31, Consolidated as specified in H.J.Res. level appropriated FY 2019 based on the total are FY 2020 billion for of $1.98 savings Estimated Estimated savings of $900 million for FY 2020 are based on the total FY 2019 appropriated level as specified in H.J.Res. 31, Consolidated 31, Consolidated as specified in H.J.Res. level appropriated FY 2019 based on the total are FY 2020 million for of $900 savings Estimated ce, Ofce, Budget See Congressional spending projections. January 2019 based on the CBO’s are FY 2020 million for of $273 savings Estimated Estimated savings of $3.5 billion for FY 2020 are based on the total FY 2019 appropriated level for “Grants-In-Aid for Airports” as specified for “Grants-In-Aid for level appropriated FY 2019 based on the total are FY 2020 of $3.5 billion for savings Estimated Estimated savings of $2.553 billion for FY 2020 are based on the total FY 2019 appropriated level as specified in H.J.Res. 31, Consolidated Consolidated 31, as specified in H.J.Res. level appropriated FY 2019 based on the total are FY 2020 billion for of $2.553 savings Estimated Estimated savings of $150 million for FY 2020 are based on the FY 2019 appropriated level as specified in H.J.Res. 31, Consolidated 31, Consolidated as specified in H.J.Res. level appropriated based on the FY 2019 are FY 2020 million for of $150 savings Estimated Heritage experts do not include any savings from repealing the Jones Act. Estimated savings of $815 million for FY 2020 are based on based are FY 2020 of $815 million for savings Estimated the Jones Act. repealing from savings do not include any Heritage experts Randal O’Toole, “‘Paint Is Cheaper Than Rails’: Why Congress Should Abolish New Starts,” Cato Institute Institute Cato Starts,” Should Abolish New Congress Rails’: Why Is Cheaper Than “‘Paint Randal O’Toole, Estimated savings of $397 million for FY 2020 are based on the CBO’s most recent January 2019 baseline spending projections. See baseline spending projections. January 2019 recent most based on the CBO’s are FY 2020 million for of $397 savings Estimated United States Code, Title 40, Subtitle IV, “Appalachian Regional Development,” https://www.arc.gov/about/USCodeTitle40SubtitleIV.asp https://www.arc.gov/about/USCodeTitle40SubtitleIV.asp Development,” Regional “Appalachian Subtitle IV, 40, Title Code, States United 31, Consolidated Appropriations Act, 2019, and H.R. 5895, Energy and Water, Legislative Branch, and Military Branch, Legislative Water, and Energy and H.R. 5895, 2019, Act, Appropriations 31, Consolidated Appropriations Act, 2019. Heritage experts assume that FY 2019 spending remains constant in FY 2020. Savings represent a 20 percent a 20 percent represent Savings in FY 2020. constant spending remains FY 2019 that assume Heritage experts 2019. Act, Appropriations Appropriations Act, 2019. Heritage experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume experts Heritage 2019. Act, Appropriations in FY 2020. constant spending remains FY 2019 that assume experts Heritage 2019. Act, Appropriations Appropriations Act, 2019. Heritage experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume Heritage experts 2019. Act, Appropriations Appropriations Act, 2019. Heritage experts assume that FY 2019 spending remains constant in FY 2020. constant spending remains FY 2019 that assume experts Heritage 2019. Act, Appropriations Year 2017 Independent Actuarial Review of the Mutual Mortgage Insurance Fund: Cash Flow Net Present Value from Home Equity Conversion Conversion Equity Home from Value Present Net Flow Cash Fund: Insurance Mortgage Mutual the of Review Actuarial Independent 2017 Year “The Budget and Economic Outlook: 2019 to 2029: Budget and Economic Data: Spending Projections, by Budget Account,” January 2019. All January 2019. Account,” Budget by Spending Projections, Data: and Economic Budget 2029: to Outlook: 2019 and Economic Budget “The

8. 5. 6. 9. ENDNOTES 15. 14. 13. 12. 10. 11. 1. 2. The Heritage Foundation | 3. 7. 4.