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108th Congress                                            Rept. 108-105
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 4

======================================================================



 
    FOREIGN RELATIONS AUTHORIZATION ACT, FISCAL YEARS 2004 AND 2005

                                _______
                                

 July 11, 2003.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

 Mr. Tauzin, from the Committee on Energy and Commerce, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 1950]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Energy and Commerce, to whom was referred 
the bill (H.R. 1950) to authorize appropriations for the 
Department of State for the fiscal years 2004 and 2005, to 
authorize appropriations under the Arms Export Control Act and 
the Foreign Assistance Act of 1961 for security assistance for 
fiscal years 2004 and 2005, and for other purposes, having 
considered the same, report thereon with an amendment and 
without recommendation.

                                CONTENTS

                                                                   Page
Amendment........................................................     2
Purpose and Summary..............................................     2
Background and Need for Legislation..............................     2
Hearings.........................................................     3
Committee Consideration..........................................     3
Committee Votes..................................................     3
Committee Oversight Findings.....................................     5
Statement of General Performance Goals and Objectives............     5
New Budget Authority, Entitlement Authority, and Tax Expenditures     5
Committee Cost Estimate..........................................     5
Congressional Budget Office Estimate.............................     5
Federal Mandates Statement.......................................    14
Advisory Committee Statement.....................................    14
Constitutional Authority Statement...............................    14
Applicability to Legislative Branch..............................    14
Section-by-Section Analysis of the Legislation...................    14
Changes in Existing Law Made by the Bill, as Reported............    14

                               Amendment

  The amendment (stated in terms of the provisions of the 
amendment in the nature of a substitute reported by the 
Committee on International Relations) is as follows:
  Strike section 730, relating to climate change and conform 
the table of sections accordingly.

                          Purpose and Summary

    The Foreign Relations Authorization Act for Fiscal Years 
2004 and 2005 authorizes funding for the Department of State 
and the United States international broadcasting activities for 
fiscal years 2004 and 2005, security assistance, and other 
foreign affairs programs. As reported by the House Committee on 
International Relations, H.R. 1950 contained section 730, which 
is a Sense of Congress regarding climate change. H.R. 1950 was 
referred sequentially to the Committee on Energy and Commerce 
for consideration of such provisions of the bill and amendment 
as fall within the jurisdiction of the Committee.

                  Background and Need for Legislation

    Section 730 of H.R. 1950, added by amendment in the House 
International Relations Committee, contains a Sense of Congress 
on climate change. Thirteen separate findings are contained in 
this section. These findings relate to the status of scientific 
inquiry into global climate change, certain actions of the 
Intergovernmental Panel on Climate Change, citation of a 
National Academy of Sciences report, reference to the United 
Nations Framework Convention on Climate Change (UNFCCC) and 
other statements of policy regarding both the science of 
climate change and the direction of public and private sector 
policies regarding climate change.
    Following the Congressional findings, section 730 indicates 
that ``It is the sense of Congress that the United States 
should demonstrate international leadership and responsibility 
in reducing the health, environmental and economic risks posed 
by climate change * * *'' Fourseparate actions then follow, 
which include ``taking responsible action to ensure significant and 
meaningful reductions in emissions of greenhouse gases from all 
sectors,'' creating flexible implementation measures for emission 
reductions and carbon sequestration, and participating in international 
negotiations, including putting forth a proposal ``securing United 
States participation in a future binding treaty on climate change * * 
*''
    The Committee on Energy and Commerce has addressed climate 
change issues on numerous occasions. Most recently, on April 2, 
2003, during consideration of the Energy Policy Act of 2003, 
the Committee considered two amendments concerning climate 
change policy. The first amendment, offered by Representative 
Waxman, was substantially similar to section 730 of H.R. 1950. 
The amendment was defeated on a roll call vote of 18 ayes and 
34 nos.
    Another amendment offered by Representative Waxman, also 
considered on April 2, 2003, contained eight findings 
concerning quotations attributed to President George W. Bush 
and Secretary of State Colin Powell as well as other statements 
concerning actions by President Bush. The amendment then 
provided a Sense of Congress statement ``reaffirming'' the 
commitment of the United States to the United Nations Framework 
Convention on Climate Change and expressing support for efforts 
to reduce carbon intensity in the United States. This amendment 
was rejected by a voice vote.

                                Hearings

    The Committee on Energy and Commerce has not held hearings 
on the legislation.

                        Committee Consideration

    On Wednesday, July 9, 2003, the Full Committee met in open 
markup session and ordered H.R. 1950 reported to the House, 
without recommendation, as amended, by a voice vote.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report legislation and amendments thereto. The 
following are the record votes taken on amendments offered to 
H.R. 1950, including the names of those Members voting for and 
against. A motion by Mr. Tauzin to order H.R. 1950 reported to 
the House, without recommendation, as amended, was agreed to by 
a voice vote.


                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee has not held oversight 
or legislative hearings on this legislation.

         Statement of General Performance Goals and Objectives

    The goals and objectives of this legislation are to provide 
authorization for the activities of the State Department and 
related agencies for fiscal years 2004 and 2005.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee finds that H.R. 
1950, the Foreign Relations Authorization Act, Fiscal Years 
2004 and 2005, would result in no new or increased budget 
authority, entitlement authority, or tax expenditures or 
revenues.

                        Committee Cost Estimate

    The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974.

                  Congressional Budget Office Estimate

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, July 11, 2003.
Hon. W.J. ``Billy'' Tauzin,
Chairman, Committee on Energy and Commerce,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1950, the Foreign 
Relations Authorization Act, Fiscal Years 2004 and 2005.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Sunita 
D'Monte.
            Sincerely,
                                       Douglas Holtz-Eakin,
                                                          Director.
    Enclosure.

H.R. 1950--Foreign Relations Authorization Act, Fiscal Years 2004 and 
        2005

    Summary: CBO estimates that H.R. 1950 would authorize 
appropriations of $32.2 billion for the Department of State and 
related agencies, and for various security and economic 
assistance programs. Implementing the bill would result in 
additional discretionary spending of $30.5 billion over the 
2004-2008 period, assuming appropriation of the authorized 
amounts, CBO estimates. The bill also contains several 
provisions that would affect direct spending and revenues. CBO 
estimates that enacting those provisions would increase direct 
spending by $25 million over the 2006-2008 period and have an 
insignificant effect on revenues.
    H.R. 1950 also would affect trade in defense article and 
services. It would give the President authority to control 
transfers within the United States of defense articles and 
defense services to foreign persons. It would lower the 
standard for violation of arms-export regulations and increase 
certain fines for violations of export controls. In addition, 
the bill would call for stringent control and scrutiny of the 
export of missile technology and would authorize the President 
to sanction any foreign governmental entity that the President 
determines has facilitated violations of export controls of 
missile equipment or technology. CBO estimates the trade-
related provisions would not significantly affect federal 
spending.
    H.R. 1950 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would impose no costs on state, local, or tribal 
governments.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 1950 is shown in Table 1. For this 
estimate, CBO assumes that the authorized amounts will be 
appropriated by the start of each fiscal year and that outlays 
will follow historical spending patterns for existing programs, 
except asotherwise described. The costs of this legislation 
fall within budget functions 050 (national defense), 150 (international 
affairs), 300 (natural resources and environment), and 800 (general 
government).

  TABLE 1.--BUDGETARY IMPACT OF H.R. 1950, THE FOREIGN RELATIONS AUTHORIZATION ACT, FISCAL YEARS 2004 AND 2005
----------------------------------------------------------------------------------------------------------------
                                                               By fiscal year, in millions of dollars--
                                                     -----------------------------------------------------------
                                                        2003      2004      2005      2006      2007      2008
----------------------------------------------------------------------------------------------------------------
                                        SPENDING SUBJECT TO APPROPRIATION

Spending Under Current Law for the State Department,
 Related Agencies, and Various Assistance Programs:
    Authorization Level 1,2.........................    17,937       900         0         0         0         0
    Estimated Outlays...............................    17,650     7,067     3,117     1,773       995       520
Proposed Changes:
    Estimated Authorization Level...................         0    15,221    15,570       476       478       479
    Estimated Outlays...............................         0     9,991    13,644     3,945     1,737     1,231
Spending Under H.R. 1950 for the State Department,
 Related Agencies, and Various Assistance Programs:
    Estimated Authorization Level 1,2...............    17,937    16,121    15,570       476       478       479
    Estimated Outlays...............................    17,650    17,058    16,761     5,718     2,732     1,751

                                           CHANGES IN DIRECT SPENDING

Estimated Budget Authority..........................         0         *         *         5        10        10
Estimated Outlays...................................         0         *         *         5        10        10
----------------------------------------------------------------------------------------------------------------
Note:--*=less than $500,000.

\1\ The 2003 level is the amount appropriated for that year and includes appropriations provided in Public Law
  108-11, the Emergency Wartime Supplemental Appropriations Act, 2003.
\2\ Public Law 106-113, an act making consolidated appropriations for the fiscal year ending September 30, 2000,
  and for other purposes, authorized appropriations of $900 million for Embassy Security, Construction, and
  Maintenance in 2004.

    Basis of estimate: H.R. 1950 would provide a comprehensive 
two-year authorization of appropriations for the State 
Department and related agencies, and it would authorize 
appropriations for various security and economic assistance 
programs. In addition, the bill contains several provisions 
that would affect direct spending and revenues.

Spending Subject to Appropriation

    CBO estimates that Divisions A and B of H.R. 1950 would 
authorize appropriations of about $32 billion for the 
Department of State and related agencies and for various 
security and economic assistance programs. CBO estimates that 
implementing the bill would result in additional discretionary 
spending of $30.5 billion over the 2004-2008 period, assuming 
appropriation of the authorized amounts.
    Division A--Department of State Authorization Act, Fiscal 
Years 2004 and 2005. CBO estimates that Division A would 
authorize appropriations of about $9.3 billion in 2004, $10.7 
billion in 2005, and $0.1 billion a year over the 2006-2008 
period for the Department of State and related agencies (see 
Table 2). It would specifically authorize appropriations of 
$9.3 billion in 2004, $10.1 billion in 2005, and some small 
amounts over the 2006-2008 period. In addition to the costs 
covered by the specified authorizations, the division contains 
provisions primarily dealing with international peacekeeping, 
public diplomacy, and personnel, that CBO estimates would 
require additional appropriations of almost $0.9 billion over 
the 2004-2008 period to implement. CBO estimates that 
implementing this division would cost almost $19.5 billion over 
the 2004-2008 period, assuming appropriation of the specified 
and estimated amounts.

                TABLE 2.--ESTIMATED SPENDING SUBJECT TO APPROPRIATION FOR DIVISION A OF H.R. 1950
----------------------------------------------------------------------------------------------------------------
                                                               By fiscal year, in millions of dollars--
                                                     -----------------------------------------------------------
                                                        2003      2004      2005      2006      2007      2008
----------------------------------------------------------------------------------------------------------------
                    Spending Under Current Law for the State Department and Related Agencies:
    Authorization Level 1, 2........................     9,257       900         0         0         0         0
    Estimated Outlays...............................     8,998     3,338     1,649     1,065       657       347
Proposed Changes:
    Estimated Authorization Level...................         0     9,340    10,694       106       108       109
    Estimated Outlays...............................         0     6,422     8,534     2,587     1,179       762
Spending Under Division A of H.R. 1950 for the State
 Department and Related Agencies:
    Estimated Authorization Level 1, 2..............     9,257    10,240    10,694       106       108       109
    Estimated Outlays...............................     8,998     9,760    10,183     3,652     1,836     1,109
----------------------------------------------------------------------------------------------------------------
\1\ The 2003 level is the amount appropriated for that year and includes appropriations provided in Public Law
  108-11, the Emergency Wartime Supplemental Appropriations Act, 2003.
\2\ Public Law 106-113, an act making consolidated appropriations for the fiscal year ending September 30, 2000,
  and for other purposes, authorized appropriations of $900 million for Embassy Security, Construction, and
  Maintenance in 2004.

    International Peacekeeping. Section 113 would authorize the 
appropriation of $550 million in 2004 and such sums as may be 
necessary in 2005 for contributions to international 
peacekeeping activities. Based on information from the 
Department of State and adjusting for inflation, CBO estimates 
that the department would require $560 million in 2005.
    Middle East Broadcasting Network. Section 501 would 
authorize annual grants for a Mideast Radio and Television 
Network to provide radio and television broadcasts to the 
Middle East region. Under current law, Radio Sawa provides 
radio programming to the Middle East at an annual cost of about 
$10 million. The Broadcasting Board of Governors (BBG) plans to 
add a satellite television network that would provide news, 
entertainment, and information programs to complement this 
radio programming. Public Law 108-11, the Emergency Wartime 
Supplemental Appropriations Act, 2003, provided $26 million in 
2003 for start-up costs of the network. The bill provides an 
authorization of appropriations of $47 million in each of 2004 
and 2005 only. Based on information from the BBG, CBO estimates 
that operating costs for this television network would be $37 
million a year over the 2004-2008 period, and the costs for 
Radio Sawa would continue at about $10 million a year.
    Exchange Programs. Section 251 would establish new 
educational and cultural exchange programs and expand existing 
ones in countries with predominantly Muslim populations. 
Section 112 would authorize the appropriations of $35 million a 
year for this purpose in 2004 and 2005. CBO estimates that 
continuing these programs would cost an additional $112 million 
over the 2006-2008 period.
    Promotion of Free Media. Section 607 would establish an 
International Free Media Fund within the department to promote 
the development of free and independent media all over the 
world. The bill would authorize appropriations of $15 million 
in 2004 for this purpose. Section 608 would require the BBG to 
support free media, especially in countries where it is 
reducing or discontinuing international broadcasting, and would 
authorize appropriations of $2.5 million each year in 2004 and 
2005 for this purpose.
    Hardship and Danger Pay Allowances. Section 307 would 
increase the cap on hardship and danger pay allowances from 25 
percent to 35 percent of basic pay for State Department 
employees serving overseas. Based on information from the 
Department of State, CBO estimates implementing this section 
would cost $8 million to $9 million annually over the 2004-2008 
period.
    Office of Global Internet Freedom. Section 524 would 
authorize the BBG to establish an Office of Global Internet 
Freedom to prevent foreign governments from censoring or 
jamming the Internet and persecuting their citizens who use the 
Internet. The bill would specifically authorize appropriations 
of $8 million a year in 2004 and 2005 to establish and operate 
this office. CBO estimates implementing this section would cost 
$8 million to $9 million annually over the 2004-2008 period.
    Indefinite Authorizations for Currency Fluctuations. 
Section 113(c) would authorize the appropriation of such sums 
as may be necessary in 2004 to compensate for adverse 
fluctuations in exchange rates that might affect contributions 
to international organizations. Any funds appropriated for this 
purpose would be obligated and expended subject to 
certification by the Office of Management and Budget. Currency 
fluctuations are extremely difficult to estimate in advance, 
and they could result in spending either higher or lower than 
the amounts specifically authorized in the bill for 
contributions to international organizations and programs. 
Therefore, this estimate includes no costs associated with 
currency fluctuations.
    Colin Powell Center for American Diplomacy. Section 230 
would authorize the Secretary of State to establish the Colin 
Powell Center for American Diplomacy at the Harry S. Truman 
Building in Washington, D.C. According to the Department of 
State, it would establish the center through a partnership with 
the nonprofit Foreign Affairs Museum Council (FAMC). The 
department would provide the space, staff, and security for the 
center, while FAMC would provide funding from private sources. 
A feasibility study is currently underway, and the department 
was unable to provide details that would allow CBO to estimate 
the operating costs of the center.
    Reporting Requirements. Division A includes several 
provisions that would expand or introduce new reporting 
requirements. Combined, these provisions would raise spending 
subject to appropriation by about $2 million annually, but each 
provision would likely cost less than $500,000 a year.
    Miscellaneous Provisions. CBO estimates that the following 
sections of Division A would have an insignificant impact on 
spending subject to appropriation;
     Section 206 would authorize a demonstration 
program in library sciences to help foreign governments improve 
literacy and public education in their countries by 
establishing or upgrading public library systems.
     Section 224 would reduce by about half the 
reimbursement rate paid by the Department of State to the 
Department of Defense (DoD) for transporting armored vehicles 
by air. Over the 2000-2002 period, the department reimbursed 
DoD an average of $2 million a year. Based on this information, 
CBO estimates that implementing this section would save the 
department $1 million a year, which would be offset by 
additional costs to DoD of the same amount.
     Section 301 would authorize an exchange program 
for the assignment of civil and foreign service employees to 
fellowship positions in foreign governments, and the reciprocal 
assignment of foreign government employees as fellows in the 
department.
     Section 302 would clarify the department's 
authority to settle claims of back pay and other administrative 
claims and grievances.
     Section 310 would give the department greater 
flexibility in awarding meritorious step increase in salaries.
     Section 504 would authorize the BBG to conduct a 
pilot program to promote travel and tourism by broadcasting 
information on regions of the United States that rely on 
tourism.
     Subtitle C of title V would transfer all functions 
and assets of the BBG and the International Broadcasting Bureau 
to a new independent agency named the International 
Broadcasting Agency.
    Division B--Defense Trade and Security Assistance Reform 
Act of 2003. Division B would tighten regulation of trade in 
defense and dual-use articles and technologies and authorize 
funding for various security assistance programs (see Table 3). 
Unlike Division A, which provides a comprehensive two-year 
authorization of appropriations of foreign relations 
authorizations, this division would authorize funding for 
various programs, projects, and activities through specific and 
indefinite authorizations of appropriation or through earmarks 
of funds not authorized elsewhere in the bill. For this 
estimate, CBO treats these earmarks as authorizations of 
appropriations since there are no amounts authorized for the 
programs in general. CBO estimates that implementing Division B 
would cost $3.6 billion in 2004 and $11.1 billion over the 
2004-2008 period, assuming the appropriation of the necessary 
amounts.

                TABLE 3.--ESTIMATED SPENDING SUBJECT TO APPROPRIATION FOR DIVISION B OF H.R. 1950
----------------------------------------------------------------------------------------------------------------
                                                               By fiscal year, in millions of dollars--
                                                     -----------------------------------------------------------
                                                        2003      2004      2005      2006      2007      2008
----------------------------------------------------------------------------------------------------------------
Spending Under Current Law for Various Security
 Assistance Programs:
    Budget Authority \1\............................     8,680         0         0         0         0         0
    Estimated Outlays...............................     8,652     3,729     1,468       708       339       173
Proposed Changes:
    Estimated Authorization Level...................         0     5,881     4,876       370       370       370
    Estimated Outlays...............................         0     3,569     5,110     1,359       558       470
Spending Under Division B of H.R. 1950 for Various
 Security Assistance Programs:
    Estimated Authorization Level \1\...............     8,680     5,881     4,876       370       370       370
    Estimated Outlays...............................     8,652     7,298     6,578     2,067       897       643
----------------------------------------------------------------------------------------------------------------
\1\ The 2003 level is the amount appropriated for that year and includes appropriations provided in Public Law
  108-11, the Emergency Wartime Supplemental Appropriations Act, 2003.

    Security Assistance and Related Provisions. Title XIII 
would authorize the appropriation of $4.4 billion for foreign 
military financing and $91.7 million for international military 
education and training in 2004.
    Sections 1321 and 1322 would authorize foreign military 
financing and Economic Support Fund appropriations for Israel 
and Egypt through 2005. The sections would specify formulas 
that would continue through 2005 the gradual reduction of 
economic assistance to those two countries and the increase in 
foreign financing for Israel begun in 1999. For Israel, section 
1321 would authorize foreign military financing of $2.160 
billion in 2004 and $2.220 billion in 2005, and Economic 
Support Fund appropriations of $480 million in 2004 and $360 
million in 2005. For Egypt, section 1322 would authorize 
foreign military financing for Egypt of $1.3 billion in both 
2004 and 2005 and Economic Support Fund appropriations of $575 
million in 2004 and $535 million in 2005.
    Section 1337 would authorize the appropriation of $60 
million a year for the nonproliferation fund in 2004 and 2005 
and $25 million a year in 2004 and 2005 to secure highly 
enriched uranium states of the former Soviet Union.
    Missile Threat Reduction Assistance. Title XIV would 
authorize the appropriation of $250 million for assistance to 
countries that agree to destroy their ballistic missiles and 
their facilities for producing those missiles. Under the bill, 
the President would determine the terms and conditions for 
providing the assistance which could be economic or military in 
character. For this estimate, CBO assumes the funds would be 
appropriated at the rate of $50 million a year over the 2004-
2008 period and the rate of spending would be comparable to 
that for the Former Soviet Union Threat Reduction.
    Belarus. Title XVI would authorize the appropriation of 
such sums as may be necessary in 2004 and 2005 for assistance 
and radio broadcasting to promote the development of democracy 
and civil society in Belarus. The assistance could be used to 
develop democratic parties, nongovernmental organizations, an 
independent broadcasting and print media, or to observe 
elections. Based on information from the State Department, CBO 
estimates that funding for such assistance in Belarus would 
continue at the 2003 level of $10 million each year. Based on 
information from the BBG, CBO further estimates that funding 
for international broadcasting to Belarus would double to $3 
million a year, for an increase of $1.5 million each year over 
the amount authorized in Division A of the bill.
    Israeli-Palestinian Peace Enhancement Act. Title XVII would 
express the sense of the Congress with respect to U.S. 
recognition of a Palestinian state and express a willingness to 
provide substantial economic and humanitarian assistance to 
such a state. It would authorize the appropriation of such sums 
as may be necessary to promote the economic and civil 
development of a Palestinian state. However, the President must 
certify a binding peace agreement between Israel and the 
Palestinians has been achieved under a set of conditions before 
any assistance may be provided to a Palestinian state. The 
President may waive the certification and the restrictions 
would not apply to humanitarian or development assistance 
provided to nongovernmental organizations for the benefit of 
the Palestinian people. CBO estimates that implementing title 
XVII would cost $0.8 billion over the 2004-2008 period, 
assuming the appropriation of the necessary amounts. The 
estimate assumes that funding in 2004 would continue at the 
2003 rate and would increase to over $0.3 billion a year over 
the 2006-2008 period.
    It is difficult to estimate the cost of implementing title 
XVII because of the uncertainty over when or whether Israel and 
the Palestinians may reach an agreement recognizing a two-state 
solution to peace in the Middle East region. Under the roadmap 
to a permanent two-state solution, as outlined by the State 
Department on April 30, 2003, the goal would be a permanent 
status agreement in 2005. CBO estimates that substantially 
increased funding for the Palestinian people could begin by 
that year.
    The bill provides no guidance for interpreting the intent 
of the phrase ``substantial economic and humanitarian 
assistance.'' For the purpose of the estimate, CBO assumes that 
funding in 2004 for West Bank/Gaza in the Economic Support Fund 
would continue at the $75 million funding level appropriated 
for 2003 and triple to $225 million in 2005. For the 2006-2008 
period, we assume that the funding for a Palestinian state 
would be increased by the $95 million that the United States 
has in the past contributed for assistance to the Palestinian 
people through the United Nations Relief and Works Agency for 
Palestinian Refuges. That increase would raise funding to $320 
million a year. In the past, breakthrough agreements such as 
the Camp David accords and peace with Jordan have been followed 
by bilateral assistance appropriations of billions or many 
hundreds of millions of dollars. Funding after a true peace 
agreement between Israel and the Palestinians could be much 
higher than CBO estimates. Without an agreement, funding would 
be much lower.
    Miscellaneous Provisions. Title XVIII contains a number of 
provisions that would authorize appropriations for various 
economic and security assistance programs. They include:
     Section 1803 would authorize $2 million a year in 
2004 and 2005 for a cooperative development program with 
Israel.
     Section 1806 would authorize $25 million a year in 
2004 and 2005 for economic assistance for East Timor.
     Section 1807 would authorize $15 million a year in 
2004 and 2005 for grants to individuals and groups supporting 
democracy building efforts in Cuba.
     Section 1809 would authorize $18.6 million a year 
in 2004 and 2005 for a Congo Basin forest partnership program.
     Section 1810 would authorize $10 million for 
programs to provide equipment and training to law enforcement 
officials, prosecutors, and judges in foreign countries in 
interpreting intellectual property laws and in complying with 
obligations under various international copyright and 
intellectual property treaties and agreements.
     Section 1811 would authorize assistance to law 
enforcement agencies in India and Ireland in 2004 and 2005. 
Based on information from the State Department, CBO estimates 
that implementing the provision would cost $3 million each 
year, assuming the appropriation of the necessary funds.
     Section 1812 would authorize $24 million in 2004 
and such sums as may be necessary in 2005 for the human rights 
and democracy fund administered by the Department of State. 
Based on information from the Department of State, CBO 
estimates funding in 2005 would continue at the level specified 
for 2004.
     Section 1815 would authorize the appropriation of 
$1 million in 2004 and such sums as may be necessary in 2005 
for a grant to the African Society for programs in Africa. CBO 
estimates funding in 2005 would continue at the level specified 
for 2004.

Direct Spending and Revenues

    CBO estimates that several provisions in the bill would 
increase direct spending or have an insignificant effect on 
receipts.
    Transfer of Defense Articles in the U.S. War Reserve 
Stockpile for Allies (USWRSA). Section 1332 would extend for 
five years the President's authority to transfer to Israel 
obsolete or surplus defense articles in the USWRSA in Israel in 
return for concessions to be negotiated by the Secretary of 
Defense. The concessions may include cash, services, waiver of 
charges otherwise payable by the United States, or other items 
of value. Since articles may be transferred by sale under 
current law, CBO estimates that the authority provided by the 
section could be used to negotiate noncash concessions thereby 
lowering offsetting receipts to the DoD.
    According to DoD, much of the material in the USWRSA in 
Israel was used in the recent Iraq conflict and the department 
is conducting a new inventory to determine what stocks remain. 
DoD also indicates that the existing authority has not used for 
Israel in the past, though similar authority has been used for 
the stockpile in Korea. Given the current status of the USWRSA 
in Israel, CBO estimates the authority would not be used in 
2004 and probably not in 2005. If the authority provided in 
section 1332 were used to the same extent as that for the 
stockpile in Korea, CBO estimates forgone receipts would total 
between $5 million and $10 million a year over the 2006-2008 
period.
    Cost-Sharing for New Diplomatic Facilities. Section 227 
would allow the Department of State, beginning in 2005, to 
charge a fee to every federal agency that has a presence at any 
U.S. diplomatic facility to help fund the construction of new 
diplomatic facilities. The amount of the fee charged would be 
determined by a formula that takes into account the number of 
employees assigned to each diplomatic mission. Based on 
information from OMB and the Department of State, CBO estimates 
that construction of new diplomaticfacilities could cost about 
$1 billion a year over the next several years and that roughly 40 
percent of these costs would be born by federal agencies other than the 
Department of State. Because the collection and spending of the fees 
would not be subject to the annual appropriation process, this 
provision would affect direct spending. CBO estimates that collections 
from the new fee would offset spending on construction, and that this 
proposal would not significantly increase or decrease federal spending 
as a whole, but would merely shift costs from the Department of State 
to other federal agencies. Ultimately, all such federal costs are and 
still would be subject to appropriation of the necessary amounts. (That 
is, the only direct spending effects relate to the intragovernmental 
transfers and their use by the Department of State.)
    Colin Powell Center for American Diplomacy. Section 230 
would authorize the Secretary to provide museum visitor and 
educational outreach services at the center and to sell, trade, 
or transfer documents and articles that are displayed at the 
center. Any proceeds generated from these services or sales 
would be retained and spent by the center. CBO estimates that 
this provision would have an insignificant net effect on direct 
spending.
    Arms Export Controls. Provisions in titles XI and XII would 
revise licensing requirements for the export of certain defense 
articles and technology and would lower the standard and 
increase fines for violations of export controls. CBO estimates 
implementing the provisions would have an insignificant effect 
on receipts and direct spending.
    Intergovernmental and private-sector impact: H.R. 1950 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would impose no costs on state, local, or 
tribal governments.
    Previous CBO estimates: On April 24, 2003, CBO transmitted 
a cost estimate for S. 925, the Foreign Relations Authorization 
Act, Fiscal Year 2004, as ordered reported by the Senate 
Committee on Foreign Relations on April 9, 2003. Several 
sections in Division A of H.R. 1950 are similar or identical to 
sections of S. 925 and would have similar costs. (The Senate 
bill would authorize appropriations only for 2004, whereas H.R. 
1950 would authorize appropriations for 2004 and 2005.)
    On June 9, 2003, CBO transmitted an estimate for S. 1161, 
the Foreign Assistance Authorization Act, Fiscal Year 2004, as 
reported by the Senate Committee on Foreign Relations on May 
29, 2003. Several sections in Division B of H.R. 1950 are 
similar or identical to sections of S. 1161 and would have 
similar costs; however, the Senate bill would provide a more 
comprehensive authorization of appropriations for economic and 
security assistance programs in 2004.
    On June 11, 2003, CBO transmitted a cost estimate for H.R. 
1950, as reported by the House Committee on International 
Relations on May 16, 2003. On June 30, 2003, CBO transmitted a 
cost estimate for H.R. 1950, as ordered reported by the House 
Committee on Armed Services on June 26, 2003. H.R. 1950, as 
reported by the Committee on International Relations, as 
ordered reported by the Committee on Armed Services, and as 
ordered reported by the Committee on Energy and Commerce all 
have similar or identical sections and would have similar 
costs; however, the Committee on Energy and Commerce's version 
of the bill does not include a provision relating to climate 
change.
    In total, the three versions of H.R. 1950 would all have 
estimated discretionary costs of about $30.5 billion over the 
2004-2008 period, and they all would have estimated direct 
spending of about $25 million over the next five years.
    Estimate prepared by: Federal Costs: State Department: 
Sunita D'Monte and Security Assistance and Foreign Aid: Joseph 
C. Whitehill. Impact on State, Local, and Tribal Governments: 
Victoria Heid Hall. Impact on the Private Sector: Paige Piper/
Bach.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that the 
Constitutional authority for this legislation is provided in 
Article I, section 8, clause 3, which grants Congress the power 
to regulate commerce with foreign nations, among the several 
States, and with the Indian tribes.

                  Applicability to Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

             Section-by-Section Analysis of the Legislation

    The Committee deleted the only section within its 
jurisdiction (section 730) contained in H.R. 1950.

         Changes in Existing Law Made by the Bill, as Reported

    The bill was referred to this committee for consideration 
of such provisions of the bill and amendment as fall within the 
jurisdiction of this committee pursuant to clause 1(f) of Rule 
X of the Rules of the House of Representatives. The changes 
made to existing law by the amendment reported by the Committee 
on International Relations are shown in the supplemental report 
filed by that committee (Rept. 108-105, Part 2).