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108th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                    108-222

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



 
      FOREIGN OPERATIONS, EXPORT FINANCING, AND RELATED PROGRAMS 
                       APPROPRIATIONS BILL, 2004

                                _______
                                

 July 21, 2003.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

    Mr. Kolbe, from the Committee on Appropriations, submitted the 
                               following

                              R E P O R T

                             together with

                            ADDITIONAL VIEWS

                        [To accompany H.R. 2800]

    The Committee on Appropriations submits the following 
report in explanation of the accompanying bill making 
appropriations for Foreign Operations, Export Financing, and 
Related Programs, and for sundry independent agencies and 
corporations for the fiscal year ending September 30, 2004, and 
for other purposes.

                        INDEX TO BILL AND REPORT

_______________________________________________________________________


                                                               Page

                                                            Bill Report
Summary of the Bill........................................
                                                                      4
Committee Recommendations..................................
                                                                      4
Title I--Export and Investment Assistance:
        Export-Import Bank of the United States............     2
                                                                      5
        Overseas Private Investment Corporation............     3
                                                                      7
        Trade and Development Agency.......................     5
                                                                      8
Title II--Bilateral Economic Assistance:
        Child Survival and Health Programs Fund............     5
                                                                      9
        Development Assistance.............................    12
                                                                     20
        International Disaster and Famine Assistance.......    13
                                                                     32
        Transition Initiatives.............................    14
                                                                     33
        Development Credit Authority.......................    14
                                                                     33
        Payment to the Foreign Service Retirement and 
            Disability Fund................................    16
                                                                     33
        Operating Expenses of the United States Agency for 
            International Development......................    16
                                                                     33
        Capital Investment Fund............................    17
                                                                     36
        Operating Expenses of the Agency for International 
            Development, Office of the Inspector General...    18
                                                                     39
        Economic Support Fund..............................    19
                                                                     39
        International Fund for Ireland.....................    21
                                                                     50
        Assistance for Eastern Europe and the Baltic States    22
                                                                     50
        Assistance for the Independent States of the Former 
            Soviet Union...................................    25
                                                                     53
Independent Agencies:
        Inter-American Foundation..........................    28
                                                                     56
        African Development Foundation.....................    28
                                                                     56
        Peace Corps........................................    29
                                                                     57
        Millennium Challenge Corporation...................    30
                                                                     57
Department of State:
        International Narcotics Control and Law Enforcement    30
                                                                     58
        Andean Counterdrug Initiative......................    31
                                                                     60
        Migration and Refugee Assistance...................    33
                                                                     64
        Emergency Refugee and Migration Assistance Fund....    35
                                                                     66
        Nonproliferation, Anti-terrorism, Demining and 
            Related Programs...............................    35
                                                                     66
Department of the Treasury:
        International affairs technical assistance.........    37
                                                                     68
Title III--Military Assistance:
        International Military Education and Training......    40
                                                                     70
        Foreign Military Financing Program.................    41
                                                                     71
        Peacekeeping Operations............................    44
                                                                     74
Title IV--Multilateral Economic Assistance:
        Global Environment Facility........................    44
                                                                     74
        International Development Association (IDA)........    45
                                                                     74
        Multilateral Investment Guarantee Agency...........    45
                                                                     75
        Inter-American Investment Corporation..............
                                                                     75
        Multilateral Investment Fund.......................    45
                                                                     76
        Asian Development Fund (ADF).......................    45
                                                                     76
        African Development Bank...........................    46
                                                                     77
        African Development Fund (AFDF)....................    46
                                                                     77
        European Bank for Reconstruction and Development 
            (EBRD).........................................    46
                                                                     77
        International Fund for Agricultural Development 
            (IFAD).........................................    47
                                                                     77
Department of State:
        International Organizations and Programs...........    47
                                                                     78
Title V--General Provisions................................    48
                                                                     79
House of Representatives Report Requirements...............
                                                                     82

                                OVERVIEW

    The Committee again faces a complex challenge in fiscal 
year 2004, due in large part to the constraints imposed by the 
Budget Resolution and the cost and number of initiatives 
proposed by the President. The 302(b) allocation for the 
Foreign Operations and Export Financing Subcommittee is 
$1,769,000,000 below the request, and the President has 
proposed four new accounts, under new and unproven 
administrative structures, totaling $2,050,000,000. In 
addition, the anticipated United States share of reconstruction 
costs in Afghanistan and Iraq may not be adequately funded in 
the request and the Committee recommendation.

                       ITEMS OF SPECIAL INTEREST

                              AFGHANISTAN

    In response to the ongoing need for assistance for 
Afghanistan, the Committee updates a general provision, section 
523, providing that not less than $600,000,000 shall be made 
available for humanitarian and reconstruction assistance for 
Afghanistan, including assistance to improve the status of 
women in Afghanistan, to repair roads and other vital 
infrastructure, and to generally improve security and the 
quality of life.
    In section 523, the Committee recommends language providing 
that not less than $150,000,000 of funds provided under 
``Economic Support Fund'' should be made available for 
assistance for Afghanistan, to be used primarily for 
reconstruction and other infrastructure assistance, including 
roads and bridges.
    Other significant reconstruction and security assistance 
for Afghanistan is provided under the headings ``Child Survival 
and Health Programs Fund'', ``Development Assistance'', 
``Migration and Refugee Assistance'', ``Nonproliferation, Anti-
terrorism, Demining and Related Programs'', ``Foreign Military 
Financing'', ``Peacekeeping Operations'', and ``International 
Organizations and Programs''.

                                  IRAQ

    In its April 2003 statement of managers in the report 
(House Report 108-76) accompanying the Emergency Wartime 
Supplemental Appropriations Act, the Committee of Conference 
stated that the $2,475,000,000 provided therein for the ``Iraq 
Relief and Reconstruction Fund'' was ``likely to be a down 
payment on a much larger United States contribution toward the 
longer-term reconstruction of Iraq.'' Events and more recent 
information obtained from the Office of Management and Budget 
and the Coalition Provisional Authority in Baghdad has 
reinforced the Committee's view that additional appropriated 
funds will be needed in fiscal year 2004. No request for Iraq 
has been received, and no funds are recommended in this Act.

                      GLOBAL HIV/AIDS INITIATIVES

    In 1987, the Committee first recommended funding for 
programs to combat the global threat from the AIDS pandemic. As 
enacted in Public Law 100-202, $30,000,000 was appropriated for 
an ``International AIDS Prevention and Control Program''. The 
Committee has continued its leadership and support for HIV/AIDS 
since then, expanding programs to include field research, care 
and treatment, and support for orphans and communities heavily 
impacted by HIV/AIDS. In cooperation with the General 
Accounting Office and the new AIDS Coordinator at the 
Department of State, the Committee will expand its oversight 
over these programs, which face many challenges and 
vulnerabilities as they expand rapidly in countries with weak 
rule of law and a history of corruption.
    This year the Committee recommends $1,430,330,000 for HIV/
AIDS, tuberculosis, and malaria, an increase of 6 percent above 
the request of $1,344,000,000. Except for $34,000,000 in ESF 
and regional accounts, the entire amount is included in the 
Child Survival and Health Programs Fund. An additional 
$644,000,000 for international HIV/AIDS, tuberculosis, and 
malaria is requested in another appropriations bill.

                      MILLENNIUM CHALLENGE ACCOUNT

    The Committee notes that in March 2002 the President 
announced a major change in the form and substance of as much 
as $10,000,000,000 in additional United States foreign 
assistance over a three year period beginning in 2004. Through 
a proposed Millennium Challenge Corporation, this new approach 
to foreign assistance would encourage economic development by 
creating a positive competition among potential recipients, 
with this competition rewarding those countries that adopt 
policies that help their citizens. On June 12, 2003, the 
Committee on International Relations ordered reported H.R. 
2441, a bill authorizing the Millennium Challenge Corporation, 
but as of the date of this report, the House has not considered 
the authorizing legislation. The Committee recommends 
$800,000,000 for the proposed Millennium Challenge Corporation, 
subject to authorization, instead of the $1,300,000,000 
requested by the President. The reduction is not intended to 
show lack of support, but to accommodate the section 302(b) 
budget allocation.

                        TRADE CAPACITY BUILDING

    The Committee this year again places major emphasis on 
economic growth, especially the role of trade capacity building 
and education. Language is included in titles I, II, and V 
directing the Trade and Development Agency, the United States 
Agency for International Development, and the Department of 
State to obligate not less than $517,000,000 for a broad range 
of activities designed to promote trade within and between 
regions. The Committee's emphasis on trade capacity assistance 
is intended to complement the African Growth and Opportunity 
and Andean Trade Acts.
    The Committee views longer-term programs that seek to 
improve rural diversification and micro, small and medium-sized 
enterprise development as important components of trade 
capacity building. These programs enable developing countries 
to participate more fully in the global trading system and 
spread the benefits of free trade, particularly to 
disadvantaged segments of the population. Furthermore, these 
types of programs help developing countries take advantage of 
new exporting opportunities to other developing and high-income 
countries alike.

                          SUMMARY OF THE BILL

    The Committee has recommended foreign assistance and export 
financing funding at a level that is $928,000,000 above the 
enacted fiscal year 2003 level, excluding the emergency wartime 
supplemental appropriation act, and that is $1,768,738,000 
below the Administration's fiscal year 2004 request of 
$18,888,733,000 in discretionary budget authority. The 
resulting total of $17,119,996,000 in discretionary 
appropriations is needed to meet the essential requirements of 
the United States and its President in conducting foreign 
policy and meeting urgent humanitarian needs abroad.

                       COMMITTEE RECOMMENDATIONS

    For export and investment assistance programs the Committee 
has recommended a gross total of $186,780,000 which is fully 
offset by collections and a negative subsidy totaling 
$306,000,000. The subsidy appropriation for the Overseas 
Private Investment Corporation is $24,000,000 and the Trade and 
Development Agency is funded at $50,000,000. Consistent with 
the President's budget request, the Committee has provided no 
subsidy request for the United States Export-Import Bank.
    The Committee has recommended $1,301,334,000 of the 
$1,554,878,000 requested for the international financial 
institutions. The overall level is $5,553,000 above the fiscal 
year 2003 enacted level and $253,544,000 below the request.
    For development and humanitarian assistance, the Committee 
has recommended a total of $3,931,330,000 of which 
$2,235,830,000 is for child survival and health programs. 
Another $1,317,000,000 is for longer-term development 
assistance. The Committee has also included $315,500,000 for 
disasters and famine relief worldwide and $55,000,000 for 
transition initiatives.
    The Committee has expanded its highly effective Child 
Survival and Health (CSH) Programs Fund to incorporate 
presidential initiatives to reduce the incidence of HIV/AIDS. 
The account is designed to ensure that there will not be 
reductions in these vital programs as the overall bilateral 
assistance program is constrained. In addition to HIV/AIDS, the 
CSH Fund continues to emphasize programs that directly affect 
children and accelerate efforts to eradicate diseases that 
threaten younger children and caregivers alike. As in fiscal 
years 2002 and 2003, the account includes population 
assistance, while basic education is funded through the 
Development Assistance account.
    The Committee has included a total of $576,000,000 in 
assistance to the Independent States of the Former Soviet 
Union, and $452,000,000 for Eastern Europe and the Baltic 
States.
    The Committee has recommended a total of $776,028,000 for 
refugee programs.
    For economic assistance under the Economic Support Fund, 
the Committee has recommended a total of $2,240,500,000, 
including $1,055,000 for Egypt and Israel under the multi-year 
schedule recommended by the Committee in 1996.
    The Committee has recommended $335,200,000 for a 
Nonproliferation, Anti-terrorism and Demining account which 
includes funding for the Nonproliferation and Disarmament Fund, 
anti-terrorism assistance, demining activities, and the United 
States voluntary contribution to the International Atomic 
Energy Agency (IAEA).
    For the Foreign Military Financing program, the Committee 
has recommended a grant program of $4,314,000,000, including an 
increase of $73,650,000 in assistance for Israel.

               TITLE I--EXPORT AND INVESTMENT ASSISTANCE


                Export-Import Bank of the United States


                         SUBSIDY APPROPRIATION




Fiscal year 2003 level................................      $509,566,000
Fiscal year 2004 request..............................  ................
Committee recommendation..............................  ................


                        ADMINISTRATIVE EXPENSES




Fiscal year 2003 level................................       $67,856,000
Fiscal year 2004 request..............................        75,395,000
Committee recommendation..............................        71,395,000


    As requested by the President, the Committee is 
recommending no subsidy appropriation for the Export-Import 
Bank in fiscal year 2004 and an appropriation of $71,395,000 
for administrative expenses, a level of $4,000,000 below the 
request and $3,539,000 above the fiscal year 2003 enacted 
level. The Committee recommends no appropriation for 
establishing a new office of inspector general.
    Although no funding is requested by the President in fiscal 
year 2004 for a subsidy appropriation, there should be no cut 
in Export-Import Bank activity levels due to extraordinary high 
balances of carryover from previous years' appropriations. The 
Committee expects that the carryover subsidy levels will 
support a projected level of Export-Import Bank authorizations 
of $14,600,000,000 in 2004, approximately $1,800,000,000 higher 
than the estimated fiscal year 2003 levels.
    The Committee was alarmed to discover the level of 
carryover subsidy balances at the Export-Import Bank. The 
Committee was unaware of the subsidy balances when recommending 
fiscal year 2003 funding levels. Therefore, the Committee 
directs the President of the Export-Import Bank to report 
quarterly to the Committee the level of authorizations, subsidy 
used, and subsidy balances from current and prior years. The 
Committee must have all relevant financial data when making 
funding decisions months after the initial request estimates 
are developed.
    The Committee provided no additional funds for a tied-aid 
``war chest''. The estimated $260,500,000 remaining ``war 
chest'' balance for tied-aid purposes may be used to support 
loans. The Committee still expects that none of the funds 
appropriated by prior acts for tied-aid credits or grants may 
be used for any other purpose except through the regular 
notification procedures of the Committees on Appropriations.
    The Committee has continued prior year language limiting 
the export of nuclear technology or fuel to certain countries.
    Again this year, the Committee recommends a one-year 
extension of the Export-Import Bank's dual use authority, which 
originally expired on June 14, 2002. Dual use authority allows 
the Bank to finance transactions dealing with items that can be 
used for both civilian and military purposes, but which must be 
non-lethal in nature and shall be used predominantly by 
civilian authorities.

                      BROOKE AMENDMENT PROCEDURES

    The Committee is aware of an inter-agency agreement among 
the Departments of State and Defense, the Export-Import Bank, 
and USAID that establishes reporting procedures regarding 
compliance with section 512 of the bill, the so-called Brooke 
amendment, and section 620(q) of the Foreign Assistance Act. 
The procedures provide a mechanism to share information among 
those agencies regarding countries that are either in arrears 
on loan repayments owed the United States or which may soon 
become so. Since the provision of foreign assistance to 
countries in arrears is restricted by those sections, 
information required by these procedures is of great importance 
to the administration of foreign assistance funds. The 
Committee directs the Export-Import Bank to continue to follow 
the inter-agency agreement.

                Overseas Private Investment Corporation


                           NONCREDIT ACCOUNT




Fiscal year 2003 level................................       $39,626,000
Fiscal year 2004 request..............................        42,385,000
Committee recommendation..............................        41,385,000


                            PROGRAM ACCOUNT




Fiscal year 2003 level................................       $23,844,000
Fiscal year 2004 request..............................        24,000,000
Committee recommendation..............................        24,000,000


    The Committee is recommending a $24,000,000 subsidy 
appropriation for the Overseas Private Investment Corporation's 
(OPIC) direct and guaranteed loan credit programs, the same 
level as the request and $41,385,000 for administrative 
expenses, $1,000,000 less than the request.
    The Committee continues prior year language required by the 
Federal Credit Reform Act and addressing representation 
expenses and availability of funds.
    As in last year's report, the Committee directs OPIC to 
continue to provide on a semi-annual basis written reports 
including the following information for each investment fund: 
the identity, selection process, and professional background of 
current and past managers; the fees and compensation currently 
provided to senior management; the amount of OPIC guarantees 
and actual investments made at the end of the previous month; 
and any additional observations that OPIC may want to include.
    The Committee commends OPIC for restructuring its 
investment funds program subsequently requiring fund managers 
to raise more capital, and thereby lowering OPIC's total risk. 
The Committee does not support an investment fund program where 
one fund failure could possibly jeopardize the entire program. 
Therefore, the Committee supports the recent investment fund 
program changes.
    The Committee commends the managers of OPIC for exploring 
new ways of meeting OPIC's development mandate, but the 
Committee remains concerned about OPIC's coordination with the 
United States Agency for International Development (USAID). To 
ensure that foreign assistance is not provided to countries on 
different terms by different United States Government agencies, 
the Committee again expects OPIC to coordinate with USAID, the 
Office of Management and Budget and other agencies of the 
United States Government with which OPIC may overlap in 
providing financing. The Committee does not believe that OPIC 
should compete with USAID in countries that have USAID missions 
and programs.
    The Committee is aware of local currency loan guaranty 
authority that OPIC is seeking in its re-authorization. The 
Committee seeks clarification from OPIC regarding the need for 
such authority, the use of OPIC subsidy necessary, and to what 
degree the United States would be exposed to additional risk as 
a result of such transactions.
    The Committee directs the President of OPIC to continue 
current policy and consult with the Committees on 
Appropriations before any future financing for non-governmental 
organizations or private and voluntary organizations is 
approved.

                  Funds Appropriated to the President


                      TRADE AND DEVELOPMENT AGENCY




Fiscal year 2003 level................................       $46,706,000
Fiscal year 2004 request..............................        60,000,000
Committee recommendation..............................        50,000,000


    The Committee is recommending $50,000,000 for the Trade and 
Development Agency (TDA), an increase of $3,294,000 above the 
2003 level and $10,000,000 below the request. The Committee 
commends TDA for its trade capacity activities and its efforts 
to keep the Committee informed of its programs. The Committee 
recommendation is below the President's request because of the 
low budget allocation, not because of a lack of support for 
TDA.
    The Committee applauds TDA for its efforts to assist 
countries in improving their aviation safety and security 
systems, which has had a positive effect on enhancing United 
States trade for our aviation and aerospace industries. The 
Committee recognizes that setting aviation and safety standards 
worldwide is an important component for integrating a global 
system of trade. Accordingly, the Committee recommends up to 
$1,500,000 for TDA to promote its work in this area by 
providing for the development of training materials to help 
prepare participating countries for International Civil 
Aviation Organization (ICAO) audits and to correct safety and 
security deficiencies.
    In collaboration with the U.S. National Institute of 
Standards and Technology, TDA is encouraged to support United 
States participation in the development of national technical 
standards compatible with American goods and services in key 
transition country markets.

                TITLE II--BILATERAL ECONOMIC ASSISTANCE


                  Funds Appropriated to the President


                  Agency for International Development


              STRUCTURE OF DEVELOPMENT ASSISTANCE ACCOUNTS

    The Committee provides two accounts for longer-term 
development assistance programs managed by the United States 
Agency for International Development (USAID). As in fiscal year 
2003, the bill includes an account for child survival and 
health programs. It also includes a separate development 
assistance account for other program sectors, including 
economic growth and trade capacity building activities, 
education, environment, and governance. As in past years, the 
Committee has included all funding for HIV/AIDS within the 
Child Survival and Health Programs Fund, but permits limited 
authority for a Coordinator of United States Government 
Activities to Combat HIV/AIDS Globally (the ``AIDS 
Coordinator'') in the immediate office of the Secretary of 
State to directly manage and obligate funds.
    Three existing regional accounts jointly managed by the 
Department of State and the Agency for International 
Development are included elsewhere in title II. The Committee 
utilizes the regional accounts to fund most economic and 
political cooperation with Russia, the independent states of 
the former Soviet Union as well as the former captive nations 
of the Soviet Empire in Central Europe, and several Andean 
countries.
    Finally, authority is provided for the United States to 
make contributions from the Child Survival and Health Programs 
Fund to three international health funds: the Global Fund to 
Fight AIDS, Malaria and Tuberculosis (the ``Global Fund''); The 
Vaccine Fund [associated with the Global Alliance for Vaccines 
and Immunizations]; and the International AIDS Vaccine 
Initiative.

                Child Survival and Health Programs Fund


                     (INCLUDING TRANSFER OF FUNDS)




Fiscal year 2003 level................................    $1,824,563,000
Fiscal year 2004 request..............................     1,495,000,000
Committee recommendation..............................     2,235,830,000
    (by transfer).....................................      (-6,000,000)


    The Committee recommends $2,235,830,000 for the ``Child 
Survival and Health Programs Fund'', an amount that is 
$740,830,000 above the request for the Child Survival and 
Health Programs Fund, but $170,830,000 above the request if it 
is adjusted to reflect the fiscal year 2003 account structure. 
The recommendation is $411,267,000 above the amount enacted for 
2003.
    The United States has been, and is continuing to be, the 
leader in the global fight against HIV/AIDS. As it has for many 
years, the Committee continues to support the fight against 
HIV/AIDS through bilateral assistance programs managed by the 
Agency for International Development. In other appropriation 
Acts, additional support for the fight against HIV/AIDS is 
provided through the Centers for Disease Control and the 
National Institutes of Health.
    In order to protect the integrity of the Child Survival and 
Health Programs Fund and the long-standing role of the 
Secretary of State as primary agent of the President of the 
United States in foreign affairs, the Committee includes 
language similar to prior year provisions that limits transfer 
of these funds to another department or agency of the United 
States Government.
    The Committee has made available a total of $1,430,330,000 
in this bill for HIV/AIDS, tuberculosis (TB), and malaria, of 
which $1,396,330,000 is funded through the Child Survival and 
Health (CSH) Programs Fund. Another $34,000,000 is provided 
through other accounts, such as the Economic Support Fund, 
International Disaster Assistance, and regional accounts for 
Eastern Europe and the former Soviet Union. The comparable 
figures for HIV/AIDS only, without TB and malaria are discussed 
under ``HIV/AIDS Summary''.

          GLOBAL FUND TO FIGHT AIDS, TUBERCULOSIS AND MALARIA

    In order to support the international character of the 
Global Fund, as jointly announced by the United States 
President and the United Nations Secretary General in 2001, the 
Committee again recommends a burden-sharing provision, similar 
to one recently enacted in Public Law 108-25, limiting the 
United States cumulative contribution at any time to one-third 
of the Global Fund's expended and currently available 
contributions by all donors.
    In order to encourage other donors, the Committee 
recommends that $400,000,000 be provided from the Child 
Survival and Health Programs Fund to the Global Fund to Fight 
AIDS, Tuberculosis and Malaria (Global Fund). To date, the 
President has requested $100,000,000 for this purpose in this 
bill. In addition, $100,000,000 has been requested for the 
Global Fund and included in the Labor, Health, and Human 
Services Appropriations bill.
    Should the Committee's recommendation in this bill and the 
Labor-HHS Appropriations bill for the Global Fund both be 
enacted into law and sufficient matching funds provided by 
other donors, the cumulative United States contribution to the 
Global Fund through fiscal year 2004 would total at least 
$1,122,700,000, far more than has been made available to the 
Global Fund, thus far, by other donors. The Committee was 
informed that United States contributions as of June 13, 2003, 
represented 42 percent of all funds received by the Global 
Fund. In the event that other donors do not pledge and deposit 
sufficient additional monies by a date certain, the residual 
would be available to the AIDS Coordinator for bilateral 
activities.
    The Committee notes that the Global Fund was established to 
fight the global resurgence of tuberculosis and malaria as well 
as HIV/AIDS. In calculating its recommended allocations for 
specific diseases, the Committee assumes that the United States 
contribution will be used for awards that focus on HIV/AIDS, 
although some may be used for tuberculosis and malaria. The 
actual distribution of funds by the Global Fund will depend on 
the merits of the proposals it receives.

         ALLOCATION OF CHILD SURVIVAL AND HEALTH PROGRAMS FUND

    Unless modifications are subsequently notified and agreed 
to by the Committees on Appropriations, fiscal year 2004 
appropriations for the Child Survival and Health Programs Fund 
are deemed to be allocated as follows:

        Category                                              Allocation
Child Survival and Maternal Health......................    $324,000,000
Vulnerable children.....................................      27,000,000
HIV/AIDS (bilateral)....................................     840,830,000
Other Infectious Diseases (TB and malaria)..............     155,500,000
Reproductive Health/Voluntary Family Planning...........     368,500,000
Unrestricted Grant to UNICEF............................     120,000,000
Global Fund to Fight AIDS, TB, and Malaria..............     400,000,000
                    --------------------------------------------------------
                    ____________________________________________________
    Total in Child Survival and Health Programs Fund....   2,235,830,000
Other CSH activities in ESF.............................      85,000,000
CSH activities in regional accounts.....................      86,000,000
                    --------------------------------------------------------
                    ____________________________________________________
    Total in all Foreign Operations accounts............   2,406,830,000

    A definition of program categories and their components can 
be found on pages 9 through 11 of House Report 107-142 and 
under the heading ``Family Planning/Reproductive Health'' on 
page 12 of Senate Report 107-58. The United States Agency for 
International Development has also issued guidance on this 
matter.
    The Committee is again including bill language that 
prohibits the use of certain funds in this account for 
nonproject assistance, or cash grants, to governments. The 
provision of cash grants as general budget support for 
governments is no longer an appropriate development tool, given 
current funding constraints. To the extent that cash grants are 
necessary for countries in transition or for specific foreign 
policy goals, funds are available through the ``Economic 
Support Fund''.

        CHILD SURVIVAL AND MATERNAL HEALTH: FORMER SOVIET UNION

    The Committee continues to be concerned about the low 
priority assigned to declining maternal and environmental 
health conditions and the increasing incidence of TB/HIV in 
Russia, Ukraine, and the Central Asian republics. The positive 
results achieved with the small amounts already spent for such 
programs in recent years have been dramatic. The Committee has 
included bill language regarding a minimum level of $63,000,000 
to be allocated for child survival and health programs within 
the separate account, ``Assistance to the Independent States of 
the Former Soviet Union.''

           CHILD SURVIVAL AND MATERNAL HEALTH: MICRONUTRIENTS

    The Committee recommends that USAID make every effort to 
provide $30,000,000 from all accounts for its overall 
micronutrient program. Vitamin A is essential to the 
functioning of the immune system and increases children's 
resistance to disease. Vitamin A affects more than 100,000,000 
children and is responsible for as many as one out of every 
four child deaths in countries where the problem exists. 
Vitamin A is a low-cost solution to many easily preventable 
diseases, and at least $20,000,000 of the overall micronutrient 
program should be for activities related to Vitamin A 
deficiency.
    The Committee has been aware for many years that iodine 
deficiency disorder (IDD) is the leading preventable cause of 
mental retardation in children. The problems associated with 
iodine deficiency are particularly of concern in the former 
Soviet republics and southeast Europe and regions of Africa and 
South Asia. Private funds, raised by Kiwanis International and 
implemented by UNICEF, are preventing the mental retardation of 
millions of children. The Committee recommends that USAID 
provide $2,000,000 from the Child Survival and Health Programs 
Fund and at least $1,500,000 from Europe and Eurasia regional 
accounts for the Kiwanis/UNICEF IDD partnership program.

         CHILD SURVIVAL AND MATERNAL HEALTH: POLIO ERADICATION

    The Committee recommendation includes within the child 
survival and maternal health allocation not less than 
$25,000,000 for the final phases of the program initiated by 
the Committee in fiscal year 1996 to eradicate polio by 2006.

     CHILD SURVIVAL AND MATERNAL HEALTH: VACCINES AND IMMUNIZATION

    The Committee is aware that three million lives could be 
saved each year if every child received life-saving 
immunizations. The Vaccine Fund, in support of the Global 
Alliance for Vaccines and Immunization (GAVI), helps close the 
gap between children who receive immunizations and those who do 
not. Since GAVI's launch three years ago, almost $1,000,000,000 
for 64 countries has been committed from all donors for 
immunization programs--potentially saving two million lives a 
year. The Committee strongly supports continued funding for 
this program, and recommends that $60,000,000 be provided to 
The Vaccine Fund in fiscal year 2004.

                          VULNERABLE CHILDREN

    The Committee directs USAID to allocate $27,000,000 for 
displaced children and orphans and blind children in fiscal 
year 2004. The Committee addresses assistance for children 
affected by HIV/AIDS elsewhere.
    Older children permanently placed in orphanages are often 
dismissed from state care and thrown out on the streets to 
survive without skills. Most such orphans find that their only 
chance for survival is to participate in criminal acts, 
including prostitution and selling drugs. United States 
assistance in establishing a limited number of vocational-
technical centers will teach these orphans the necessary skills 
to become productive members of society. The Committee is aware 
of the effective programs to address this situation by the 
Fabretto Children's Foundation and requests that USAID support 
them.
    Worldwide, one child goes blind every minute. There are one 
and a half million blind children, and another 7 million 
children suffer from low vision. The Committee recognizes the 
work being done by Helen Keller Worldwide and other 
organizations to assist these children, who can be helped 
through simple and inexpensive methods of prevention and low 
cost care. The Committee recommends that the USAID program for 
children's blindness be funded at a level of $1,500,000.
    The Committee notes that handicapped and other 
disadvantaged children in USAID countries have few 
opportunities for physical exercise that promotes development. 
A significant portion of the allocation for vulnerable children 
should be allocated for established organizations such as 
Special Olympics and Olympic Aid that have a record of 
accomplishments in this sector.
    The Committee commends the work of Operation Smile in 
repairing childhood facial deformities and building sustainable 
healthcare systems in the developing world. The Committee urges 
USAID to consider a proposal by Operation Smile to complement 
the organization's private support with federal funds.

                           HIV/AIDS: OVERVIEW

    As with all USAID programs, the fight against HIV/AIDS 
requires ``good development partners''. The rapid increase in 
HIV infection in many poor countries can be attributed, in 
part, to government leaders' refusal to publicly acknowledge 
the crisis and to their slowness in dedicating resources to 
fight it. Government leaders have a responsibility to their 
citizens to foster awareness and education, the causes of 
transmission, and the scientifically proven methods to combat 
it. All USAID country strategies for HIV programs must include 
components to encourage behavioral, cultural and social change.
    The United States has long led the world's response to HIV/
AIDS and will expand its financial commitment as effective 
models of assistance and effective partners are identified.

                       HIV/AIDS: AIDS COORDINATOR

    The Committee notes that the President has made his 
nomination for the office of the AIDS Coordinator in the State 
Department. The Committee regards the HIV/AIDS pandemic as an 
emergency and remains concerned that funds appropriated to 
fighting the disease are spent in an efficient, effective 
manner. The Committee has been concerned for some time about 
the lack of coordination among United States HIV/AIDS programs, 
now housed in at least four agencies or departments, and 
expects that the Coordinator will move rapidly to provide 
oversight and coordination. The Committee is aware of the 
reporting requirements established in Public Law 108-25 and 
requests the Coordinator to also submit his reports to the 
Committee. The Committee also requests the Coordinator to 
include anticipated fiscal year 2004 funding levels for AIDS 
prevention programs, and a brief summary of each such program, 
in the report established in section 102 of Public Law 108-25.
    The Committee concurs that the President's Emergency Plan 
should be a focused, results-driven program. The Committee has 
serious concerns, however, about the lack of transparency with 
which countries were selected for the Emergency Plan and, 
noting the need to act proactively in some countries to keep 
the disease from erupting into the general population, directs 
the Coordinator to include in the Emergency Plan one country 
not in Africa or the Caribbean region. The Committee also notes 
that a more comprehensive regional approach to fighting HIV/
AIDS in Africa and the Caribbean would better address the 
significant patterns of migration in those areas, and 
encourages the President and the AIDS Coordinator to direct 
Emergency Plan resources to Malawi, the Dominican Republic and 
the smaller Caribbean island states where political support by 
local leadership is evident.
    The Coordinator will have to determine which functions 
should be taken over by his office and which will remain with 
the implementing agencies. Since these decisions have not been 
made yet but will have implications for funds appropriated by 
this Act, the Committee has provided the Coordinator with 
unique flexibility. However, some choices seem clear even now. 
For instance, USAID has largely acted as a ``pass-through'' for 
funding to the International AIDS Vaccine Initiative and the 
United Nations Joint Program on HIV/AIDS (UNAIDS). The 
Committee assumes that the Coordinator take over these 
payments. The Coordinator should also assume responsibility for 
the United States contribution to the Global Fund. Additional 
discussion of the Global Fund may be found elsewhere in this 
report.
    Public Law 108-25 enables the Coordinator to provide grants 
to and enter into contracts with non-governmental 
organizations, an ability which will undoubtedly enhance the 
Coordinator's oversight and coordination roles. The Committee 
provides $50,000,000 for grants and contracts entered into by 
the Coordinator's office, in addition to the funds given for 
directives. The Committee is aware, however, that grant and 
contract management requires extensive experience and 
expertise, and accepts that some time may be needed to 
establish a system in the Coordinator's office that will ensure 
sound, science-based decisions. In the interim, the Coordinator 
should continue to rely on established structures to ensure 
that the flow of funds is not interrupted.

                 HIV/AIDS: MOTHER-TO-CHILD TRANSMISSION

    The Committee strongly supports the inclusion of funding 
for programs to prevent mother-to-child transmission (MTCT) of 
HIV as an integral element of a comprehensive approach to HIV 
prevention efforts and as a springboard for reaching families 
and infected persons with expanded support, care and treatment. 
The AIDS Coordinator and USAID should ensure that established 
MTCT programs expand to provide support, care and treatment for 
families.
    The Committee is concerned, however, that the process for 
approving country plans and sub-awards for the prevention of 
MTCT and related care and treatment requires the concurrence of 
multiple agencies and departments, including the Office of 
National AIDS Policy, USAID and its field missions, the 
Department of Health and Human Services, the Centers for 
Disease Control and its field offices, the National Institutes 
of Health, the Office of Management and Budget, and the 
Department of State. Approval of these country plans and sub-
awards, which will fund the delivery of urgently needed 
services, must not be inordinately delayed. With 2,000 new HIV 
infections of children daily, funding must be made available as 
quickly as possible to maximize the impact of the response. The 
Committee expects the new AIDS Coordinator to expedite this 
process.
    The Committee requests that the AIDS Coordinator, in 
cooperation with USAID and other relevant agencies, provide the 
Committee with written documentation of the streamlined 
approval process within 30 days of enactment of this Act.

                  HIV/AIDS: VACCINES AND MICROBICIDES

    The Committee notes that, at the end of 2002, half of the 
world's HIV/AIDS-infected people were women. The typical woman 
who becomes infected with HIV has only one sexual partner--her 
husband, and very little say over the occurrence, frequency, 
and terms of sexual contact. The Committee believes that this 
increases the urgency of finding woman-controlled methods of 
HIV prevention such as topical microbicides. More than 60 
potential microbicides are currently being researched and 
tested around the world, and, once developed, could serve as 
key prevention technologies complementary to vaccines, condoms, 
and other methods. USAID has played a particularly important 
role in the preclinical and clinical evaluation of potential 
new products, and the Committee urges that not less than 
$24,000,000 in bilateral HIV/AIDS funds be available for 
microbicide research and development.
    The Committee acknowledges the critical need to find other 
new technologies to prevent HIV infections and provides not 
less than $15,000,000 for research on and testing of AIDS 
vaccines. These funds will be allocated by the Office of the 
AIDS Coordinator at the State Department to the International 
AIDS Vaccine Initiative.

                      HIV/AIDS: CARE AND TREATMENT

    The AIDS Coordinator and USAID are urged to accelerate 
efforts to identify strategies for implementing broad-based 
programs that include treatment. The Committee also recognizes 
the importance of involving people living with HIV/AIDS in the 
planning and implementation of programs, and urges increased 
efforts in this area through collaborations with established 
peer organizations.
    The Committee notes that, as the President emphasized 
during his 2003 State of the Union Address, the cost of anti-
retroviral drugs has dropped dramatically in recent years--in 
many cases as low as $300 per year per person. As the AIDS 
Coordinator at the State Department begins to assess potential 
purchases of anti-retroviral drugs, the Committee urges the 
Coordinator to develop policies and procedures that incorporate 
considerations of quality, efficacy, and safety as well as the 
widest possible distribution of such drugs. The Committee notes 
the policy put in place by the Global Fund to Fight AIDS, TB, 
and Malaria regarding such matters. The Coordinator shall 
include in the report required by section 307 of Public Law 
108-25 efforts being undertaken to avoid illegal diversion 
generally, and not into the United States only, of drugs 
purchased for humanitarian purposes. The Coordinator shall also 
include in the report called for in section 101 of Public Law 
108-25 a description of the steps being taken to purchase anti-
retrovirals at competitive prices while protecting quality, 
efficacy, safety, and intellectual property rights.

                            HIV/AIDS: AFRICA

    The Committee notes that Nigeria now has the third largest 
number of people living with HIV/AIDS, and in some states the 
infection rate is as high as 20 percent. In order to reverse 
the emergence of HIV in Nigeria, the Committee supports a 
faith-based Christian/Islamic program, two-thirds of which will 
be funded through Nigerian sources, to promote HIV/AIDS 
awareness and prevention among secondary students.
    In Uganda, Kenya and elsewhere in Africa, as part of a 
broad range of responses to the HIV/AIDS pandemic, the 
Committee supports expansion of programs to promote sexual 
abstinence education programs in primary and secondary schools 
throughout the continent. Proposals by established programs 
such as Stay Alive and Silver Ring merit special consideration 
by the AIDS Coordinator.

          HIV/AIDS: CHILDREN AND FAMILIES AFFECTED BY HIV/AIDS

    AIDS is devastating the family structure in many countries, 
leaving millions of children orphaned and more vulnerable to 
HIV infection, poor health, little schooling, and even sexual 
exploitation. Approximately 600,000 newborns in the developing 
world contracted the virus just last year. Experts predict that 
the number of AIDS orphans will reach 40,000,000 by the end of 
the current decade.
    The Committee strongly supports efforts to assist these 
vulnerable children, and urges that at least $20,000,000 be 
provided to assist AIDS orphans and HIV positive children. The 
Committee requests that the Coordinator and USAID assign 
priority focus to vulnerable children affected by AIDS in 
Haiti. The Committee encourages USAID to support effective 
programs, including those administered by UNICEF and non-
governmental organizations such as HOPE Worldwide and Lott 
Carey International, that are operating within nations affected 
by the epidemic.
    The Committee commends the work of private voluntary 
organizations such as the Foundation for Hospices in sub-
Saharan Africa to provide home-based hospice and palliative 
care to those dying of HIV/AIDS in Africa. In addition, six 
organizations have joined forces in the Hope for Africa 
Initiative. Under this initiative, CARE, PLAN International, 
World Conference of Religions for Peace, World Vision 
International, Save the Children Alliance, and the Society for 
Women and AIDS in Africa are working together to increase the 
capacity of local communities to build awareness and reduce 
stigma surrounding HIV/AIDS extend the life of the parent-child 
relationship, prepare families for transition, and ensue 
children's future. The Committee encourages the AIDS 
Coordinator and USAID to expand funding of such community based 
efforts.
    A primary factor in the impoverishment of children affected 
by HIV/AIDS is the denial of inheritance rights of widowed 
women in many African countries. Often mothers with children 
are no longer allowed to remain in the family home or cultivate 
matrimonial land after a spouse living with HIV/AIDS dies. 
Denial of inheritance rights also aggravates the HIV/AIDS 
epidemic by forcing young widows with few resources into 
relations with men who carry HIV/AIDS, effectively increasing 
the number of orphans. The Committee again urges USAID to 
support non-governmental organizations with competence to 
address this issue in Africa.

                       HIV/AIDS: MEDIA EDUCATION

    The fight against HIV/AIDS takes place on many fronts. More 
education about causes, effects and treatment of HIV/AIDS is 
needed in many regions, especially in Sub-Sahara Africa and the 
Caribbean. A promising approach to prevention is the use of 
unbiased, accurate, and culturally sensitive media to spread 
information on HIV/AIDS. The Committee supports additional 
funding for independent media training and effective public 
service announcements to meet these needs.

                            HIV/AIDS SUMMARY

    The Committee anticipates that at least $30,000,000 for 
HIV/AIDS will be funded from the Economic Support Fund 
($13,000,000) and regional accounts ($17,000,000). Together 
with not less than $1,240,830,000 from the Child Survival and 
Health Programs Fund, the bill makes available $1,270,830,000 
for HIV/AIDS. These numbers do not include bilateral TB or 
malaria programs, although there may be some overlap.

                   OTHER INFECTIOUS DISEASES: MALARIA

    The Committee includes not less than the fiscal year 2003 
level for the prevention of malaria, a re-emerging global 
killer of children and a major impediment to economic 
development in many poor countries. Serious consideration 
should be given to awarding a grant in excess of $3,500,000 to 
demonstrate United States support for the Medicines for Malaria 
Venture, a public/private partnership leading the effort to 
develop new, affordable malaria drugs.

                OTHER INFECTIOUS DISEASES: TUBERCULOSIS

    The Committee recognizes that tuberculosis (TB) is the 
major infectious killer of adults in the world, killing between 
two and three million each year. This disease could result in 
the deaths of up to 30,000,000 people in the next decade. TB 
kills more women than any other cause and is the major killer 
of persons with AIDS. Many of these will be parents, whose 
orphans will be a burden on already stressed societies. In 
addition, the Committee notes the threat to the United States 
from this disease due to international travel and immigration. 
An estimated 15 million Americans are currently infected with 
the TB bacillus.
    Therefore, the Committee includes not less than $85,100,000 
from all accounts for programs for the prevention, treatment, 
control of, and research on tuberculosis. The Committee 
encourages USAID to utilize the Global TB Drug Facility (GDF) 
to treat multi-drug resistant TB. Ongoing work at Stellenbosch 
University in South Africa is raising the awareness of the 
severity of tuberculosis as the major cause of death among 
those living with AIDS, and the Committee requests the AIDS 
Coordinator to consider expanding TB education and training 
programs beyond the Republic of South Africa to other nations 
in the region.

                      REPRODUCTIVE HEALTH OVERVIEW

    The Committee has provided a bill total of $425,000,000 for 
reproductive health/voluntary family planning, as requested by 
the President. The Committee expects that $368,500,000 of this 
total will be derived from the Child Survival and Health 
Programs Fund, the same level as fiscal year 2003.

  OTHER INFECTIOUS DISEASES: ANTIMICROBIAL RESISTANCE AND SURVEILLANCE

    The Committee supports the efforts of USAID and the Centers 
for Disease Control to reduce the spread of antimicrobial 
resistance. The Committee is aware of the special problems of 
infectious diseases among patients hospitalized in Asia, Latin 
America, and Africa, and encourages USAID to encourage the use 
of proven new technologies to combat antimicrobial resistance.

      REPRODUCTIVE HEALTH/VOLUNTARY FAMILY PLANNING: RESTRICTIONS

    The Committee has continued prior year language in the bill 
that requires that none of the funds appropriated in this bill, 
or any unobligated balances, be made available to any 
organization or program which, as determined by the President, 
supports and participates in the management of a program of 
coercive abortion or involuntary sterilization. The bill 
language also states that funds cannot be used to pay for the 
performance of abortions as a method of family planning or to 
motivate or coerce any person to practice abortion. Further, 
the language indicates that in order to reduce reliance on 
abortions in developing countries, population funds shall be 
available only to voluntary family planning projects which 
offer, either directly or through referral, information about 
access to a broad range of family planning methods and 
services. An additional provision in the bill requires that in 
awarding grants for natural family planning under section 104 
of the Foreign Assistance Act, no applicant shall be 
discriminated against because of such applicant's religious or 
conscientious commitment to offer only natural family planning.
    The Committee also has continued prior year language that 
states that nothing in the bill is to alter any existing 
statutory prohibitions against abortion which are included 
under section 104 of the Foreign Assistance Act. Further, the 
Committee has continued prior year language which states that 
project service providers or referral agents cannot implement 
or be subject to quotas or other numerical targets of total 
number of births, number of family planning acceptors, or 
acceptors of a particular method of family planning.
    The Committee is concerned by reports of misinformation 
regarding the effectiveness of condom use, especially by 
marital partners living with HIV/AIDS, and has included new 
language requiring that information on condom use provided by 
programs supported by funds made available by this Act shall be 
medically accurate and shall include the public health benefits 
and failure rates of such use.

          GRANT TO THE UNITED NATIONS CHILDREN'S FUND (UNICEF)

    The Committee supports efforts to reach the child survival 
goals set by the World Summit for Children. UNICEF is an 
essential partner of the United States in achieving these 
goals, particularly in the areas of immunization, child health 
and the efficient procurement of medicines. UNICEF also assists 
the United States in the response to emergency crises resulting 
from wars that affect the well-being of children. Already, 
UNICEF has been awarded grants of $28,000,000 from the Iraq 
Relief and Reconstruction Fund for the 4-month period ending 
August 15, 2003.
    The Committee recommends that $120,000,000 be provided in 
unrestricted grant form to the United Nations Children's Fund.

                         HEALTH CARE IN AFRICA

    The West Africa AIDS Initiative, a coordinated effort to 
prevent and treat HIV/AIDS in the militaries of the Economic 
Community of West African States (ECOWAS), favorably impresses 
the Committee. Proposals submitted on behalf of the West 
African Health Organization, supported by ECOWAS presidents and 
American schools of public health, including minority 
institutions, merit priority funding of $3,500,000 by the AIDS 
Coordinator.
    In order to facilitate one of the most promising recent 
developments in African health, the Committee strongly 
recommends not less than $5,000,000 for rapid blood testing 
safety programs. In addition, the Committee supports funding of 
existing programs to provide training for proper testing 
procedures, program administration, and quality system 
controls. Where feasible, lower-cost, quality Africa-based 
implementers and non-reusable needles and syringes should be 
utilized. The Committee requests the AIDS Coordinator to 
promote the use of injection devices with reuse prevention 
features as an element in efforts to combat HIV/AIDS and other 
infectious diseases.
    The Committee notes the recent UNFPA report indicating that 
obstetric fistula is a much more widespread problem in sub-
Saharan Africa than recently believed. The incidence of fistula 
in Sierra Leone is particularly severe, due in part to the ten-
year civil war in that country and also to the overall poor 
condition of the health system. The incidence of this 
debilitating condition could be decreased through increasing 
access for women to skilled birth attendants and medical care, 
and those women who have already suffered fistula could be 
helped by training local doctors to care for fistula patients 
and continuing programs that bring in visiting and volunteer 
surgeons to repair the condition. The Committee notes that 
USAID does not currently fund any programs specifically aimed 
at this condition, and urges USAID to intitiate programs in the 
most heavily affected areas. The Committee understands that 
International Medical Corps (IMC) has a distinguished record of 
providing health services, and specifically fistula repair 
services, in Sierra Leone, and urges USAID to provide 
$1,000,000 to enable IMC to significantly expand its program 
with the Sierra Leone Ministry of Health and Sanitation to 
address the problem of obstetric fistula. The committee 
supports the establishment of airborne medical transport 
services in African countries to fly medical personnel, 
supplies, and anti-retroviral therapies to rural areas on a 
regular schedule. The aircraft involved in this operation may 
also be used to bring HIV/AIDS, tuberculosis, and malaria 
educational materials and services to the areas served and may 
be used to transport patients requiring emergency care to 
specialized hospitals, supplementing existing ground-based 
ambulance services. The Committee urges the AIDS Coordinator to 
allocate sufficient funds for pilot programs in two African 
regions where scheduled air service is insufficient to serve 
the needs of the fight against HIV/AIDS.
    The Committee is aware that the vast majority of Congolese 
citizens no longer have access to primary health care as a 
result of wars and corrupt governments since its independence 
in 1960. Restoration of primary health care should be the major 
objective of USAID activities in war-torn regions of Congo. In 
addition to its ongoing efforts to support restoration of 
primary health care throughout the former Zaire, the Committee 
is aware of the efforts of a public-private partnership, the 
Dikembe Mutombo Foundation, to build the first major hospital 
and teaching facility in Kinshasa in almost 40 years. Upon 
completion of the privately-funded physical infrastructure, the 
Committee recommends that up to $2,000,000 be allocated over 
several years to support a Foundation proposal to promote 
primary health care and upgrade surviving clinics and health 
centers throughout the Congo.

                     PUBLIC HEALTH IN THE CARIBBEAN

    The Committee is aware of the interest of INOVA Fairfax 
Hospital in promoting continuing medical and health care 
education to physicians and nurses in the Pignon region of 
Haiti, and recommends that USAID give serious consideration to 
supporting such a public-private partnership. The Committee 
notes that the Global Fund made an early and significant award 
to recipients in Haiti, and encourages USAID to continue to 
work with the principal recipients to arrest the spread of HIV/
AIDS in Haiti. The Committee expects USAID not to increase 
support for HIV/AIDS programs in Haiti at the expense of other 
Child Survival and Health programs there.

                         Development Assistance





Fiscal year 2003 level................................    $1,379,972,000
Fiscal year 2004 request..............................     1,345,000,000
Committee recommendation..............................     1,317,000,000


    The Committee recommends $1,317,000,000 for the general 
account for development assistance for economic growth, trade 
and environment. The amount recommended is $28,000,000 below 
the budget request and $62,972,000 below the fiscal year 2003 
level. Funding in this account includes worldwide activities 
for free market economic development, agriculture, rural 
development, literacy and basic education for children and 
adults, environment, energy, science and technology and other 
programs related to longer-term development.

                       ECONOMIC GROWTH: OVERVIEW

    The Committee considers free market economic growth, and 
the USAID programs designed to lead directly to growth, the 
Agency's most important objective in Latin America and Asia. 
Simply put, without sustained economic growth, USAID's 
development programs for health, population, environment and 
other purposes, can have only marginal long-term benefits in 
poor countries.
    In the near-term, the Committee continues to support 
increases in USAID resources for health improvement through the 
``Child Survival and Health Programs'' account. But improved 
social conditions of children matter only if the future 
economies of these countries can provide employment for these 
healthier, better educated citizens. Therefore, the Committee 
encourages USAID to increase funding for free market economic 
development in its development programs in each of these 
regions.
    The Committee continues to support USAID technical 
assistance programs to encourage macro-level economic growth. 
These include programs to assist with privatization of state-
run industry and legal and regulatory reform to modify trade 
and tax barriers which stifle local entrepreneurs and which 
deter United States investment. In addition, USAID technical 
help for improving energy, transportation, telecommunication, 
and finance sectors is key to directly improving the economic 
climate of poor countries. Essential to this, of course, USAID 
must continue to search out reform-minded government leaders 
without whom these programs cannot succeed. The proposed 
Millennium Challenge Account is based on this approach.
    The Committee supports the efforts of USAID to better 
coordinate with the United States Trade Representative and 
other concerned agencies the significant amounts of aid already 
being committed to assist other countries to strengthen their 
trade-related laws and regulatory regimes. It is in the United 
States national interest to ensure that relevant economic 
growth funds are programmed to complement trade negotiating 
objectives.

                HUMAN CAPACITY BUILDING: BASIC EDUCATION

    The Committee recognizes that educating children in 
developing countries provides the foundation for sustained 
economic growth, poverty alleviation, and the creation of 
democratic institutions. There is also clear evidence that the 
collateral benefits of providing basic education for girls, 
including improved child and maternal health, lower fertility 
rates, reduced child labor, and increased political 
participation, make it one of the most effective expenditures 
of United States foreign assistance.
    The Committee also recognizes the importance of education 
in the fight against HIV/AIDS in developing countries. The 
pandemic has severely affected not only school-age children, 
but also the teacher populations in sub-Saharan Africa. The 
Committee encourages USAID to promote approaches to HIV/AIDS 
prevention which recognize the central role played by schools 
and teachers, including integrating information into curricula, 
instituting prevention programs in schools, and focusing on 
HIV/AIDS in teacher training institutes.
    The Committee recognizes that expanding access to 
education, especially combating child and adult illiteracy, is 
critical to long-term development.
    The Committee supports the work of Alfalit International, 
an educational nongovernmental organization dedicated to 
promotion of literacy, elementary education, and community 
development in Africa and Latin America. Alfalit's proven 
record during the past three decades has helped significantly 
reduce child and adult illiteracy throughout Latin America and 
Africa. The Committee urges USAID to provide not less than 
$1,500,000 for Alfalit to jointly develop and implement 
programs to combat adult illiteracy in additional countries in 
which USAID operates.

          HUMAN CAPACITY BUILDING: WOMEN'S LEADERSHIP TRAINING

    The Committee notes that USAID ignored language included in 
House Report 108-10 directing that $10,000,000 in Development 
Assistance funding be provided to the Bureau of Democracy, 
Conflict, and Humanitarian Assistance for women's leadership 
training programs. In House Report 107-663, the Committee 
clearly set forth the potential uses of these funds, indicated 
that they could be used for various aspects of women's 
leadership training, including: building capacity of women-led 
NGOs to advocate for women's rights, legislative, judicial, and 
security sector-reform; facilitating women's involvement in 
peace and reconstruction processes in conflict-ridden and post-
conflict societies; and training women to participate in local 
and national political systems. Despite this clear direction, 
USAID has indicated it will spend $6,120,000 on such programs, 
and has included construction projects for girls' schools and 
dormitories as part of the calculation, which was not the 
intention of the Committee. The Committee has therefore 
provided that not less than $11,000,000 in Development 
Assistance shall be made available only for programs to improve 
women's leadership capacity, and that these funds may not be 
used for construction. The Committee directs USAID to report 
not later than 90 days after the enactment of this Act on its 
plan for obligating and disbursing these funds.

                        TRADE CAPACITY BUILDING

    Trade capacity building (TCB) is a critical element of 
development assistance because it can be leveraged to generate 
economic growth, reduce poverty, promote the rule of law, and 
help provide the much needed public resources to finance social 
investments by developing countries. Over time, it plays a 
catalytic role in helping to leverage other resources for 
sustainable development.
    Trade capacity building initiatives help developing 
countries participate in the global trading system. When 
successful, such capacity building can contribute to more 
beneficial trading relationships and the acceleration of 
poverty elimination and economic growth in developing 
countries. Developing countries that generate growth through 
trade will be less dependent on official aid over time.
    For fiscal year 2004, the Committee provides $194,000,000, 
an increase of $35,000,000 over last year, for trade capacity 
building efforts. Of this increase above current levels, 
$25,000,000 should be for building developing country capacity 
to implement trade arrangements with the United States, 
particularly in customs, sanitary and phyto-sanitary measures; 
improvements in governance and transparency regarding 
government procurement; and related regulatory reforms that may 
be necessary in order for the developing country to benefit 
fully from the trading arrangement.
    The remaining $10,000,000 should be used for programs that 
should include: trade policy and related training for 
government officials, such as customs officers, environmental 
analysts, trade and investment policy officials, patent and 
copyright officials, food safety inspectors, and financial 
service regulators; technical assistance for environmental 
reviews; technical assistance and other initiatives that foster 
trade policy coordination among government agencies to make 
such trade agencies more effective and transparent, and to 
improve outreach to civil society and the private sector; and 
technical assistance to improve government agencies' 
statistical and analytical capabilities in the areas of trade, 
investment and services.
    The Committee expects that these resources will be used to 
respond to developing country requests for assistance. 
Resources should be allocated to countries engaged or engaging 
in special training arrangements with the United States.
    The Committee recognizes that agencies of the United States 
Government have vast expertise that makes them uniquely 
situated to conduct TCB initiatives. Because of this expertise, 
the Committee finds that interagency coordination is a key 
ingredient to the creation and implementation of practical and 
effective TCB work plans. USAID is encouraged to continue to 
take steps to comply with the interagency process it outlined 
and be an active developing country partner in TCB action 
plans.
    The Committee requests that USAID and the Department of 
State, report not later than February 25, 2004, on how the two 
entities coordinate the development of TCB programs using 
funding from the Economic Support Fund (ESF) that they co-
manage together. The Committee is particularly interested in 
the following: (1) the circumstances in which one agency is in 
greater control of the creation and implementation of TCB 
programs than the other; (2) how the two organizations consult 
the inter-agency process in the context of ESF; and (3) how 
USAID and State Department officials in the field coordinate 
with the inter-agency process in Washington, DC.
    In resource allocation and programming, USAID should also 
consult with the Office of Trade Capacity Building of the 
United States Trade Representative. When responding to trade 
capacity building proposals or action plans by developing 
countries, USAID also should solicit expertise from relevant 
Federal agencies such as Customs, Department of Commerce's 
Commercial Law Development Program, United States Food and Drug 
Administration, the Department of Agriculture's Animal and 
Plant Health and Inspection Service, and the International 
Trade Commission.
    The Committee views evaluation and assessment of current 
TCB programming as centrally important to being able to 
determine the results of assistance as well as pinpoint the 
most effective forms of assistance. The Committee requests that 
USAID report not later than May 20, 2004, on the criteria that 
it uses to evaluate its TCB initiatives and how lessons learned 
from such assessment are incorporated into future TCB work 
plans.

           GLOBAL ISSUES: URBAN PROGRAMS AND PROPERTY RIGHTS

    The Committee is aware that urban populations in developing 
nations are growing rapidly, threatening the quality of life 
for billions of individuals. Within less than ten years, more 
people will be living in the world's cities than in its small 
towns and villages. The Committee is concerned that USAID 
funding for urban programs and associated technical staff has 
been declining sharply as urban growth accelerates.
    Often property rights and commercial activity are adversely 
affected by inefficient, often corrupt, systems of registering 
small businesses and land titles. The Committee endorses 
expanding programs that promote property rights into selected 
countries where USAID is active in Latin America, Central Asia 
and North Africa. The Committee has provided sufficient funds 
for USAID to continue to fully fund its cooperative agreement 
with the Institute for Liberty and Democracy and to expand the 
International Real Property Program into a worldwide effort.

   GLOBAL ISSUES: CLEANER ENERGY, RELIABLE POWER AND THE ENVIRONMENT

    The Committee is aware that many environment challenges, 
from urban pollution to rural deforestation, are a result of 
failures to develop cleaner energy and more efficient power 
sources. Where lead continues to be used in gasoline, diesel 
generators substitute for electricity from unreliable grids, 
and areas surrounding towns and villages are denuded of 
vegetation in the daily search for cooking fuel, humans and 
their environment are degraded. The Committee welcomes the new 
focus of the President and Secretary of State on power 
generation for sustainable development.
    As a key element of the power for sustainable development 
initiative, the Committee recommends a renewed emphasis on 
hydropower, using an initial multi-year grant of $3,000,000 to 
a specialized non-governmental organization representing the 
United States hydropower industry to provide project 
development and implementation services. As with other power 
and energy sectors, USAID has a key role in assisting foreign 
governments, international financial institutions, and the 
local private sector to establish necessary energy and 
investment framework and governance practices in emerging 
markets.

       GLOBAL ISSUES: ACCESS TO CLEAN WATER AND WATER MANAGEMENT

    The Committee is pleased that the Administration is 
directing additional resources toward clean water and water 
management, more than $350,000,000 in fiscal year 2004. 
Competition for scarce fresh water is already predicted to be a 
major source of international conflict during the twenty-first 
century, as it is now within the Middle East. Elsewhere, intra-
regional cooperative programs for water management, for the 
Indus Water Agreement between India and Pakistan more than 40 
years ago to the new South Asia Water Resources Program, are 
notable accomplishments for international development 
assistance.
    In Africa, especially in communities severely impacted by 
HIV/AIDS, ready access to clean water is lacking, resulting, in 
increasing rates of water-borne diseases and higher infant 
mortality rates. The Committee urges the President to direct 
not less than $50,000,000 from this Act to build wells in rural 
areas, and secure water delivery systems in urban areas, of 
African communities that lack access to fresh water.

                      GLOBAL ISSUES: BIODIVERSITY

    The Committee applauds the accomplishments of USAID in 
integrating biodiversity and forest management in its economic 
and social development programs. The Committee urges USAID to 
provide not less than $110,000,000 in fiscal year 2004 for its 
biodiversity and related environment programs.
    Concerned with contributions to regional instability from 
resource scarcity and other issues of environmental security, 
the Committee continues to support the work of centers of 
expertise such as the Foundation for Environmental Security and 
Sustainability.
    The Committee again recommends that USAID continue to 
provide $500,000 to support the Neotropical Raptor Center in 
Panama to conserve birds of prey in the Panama Canal watershed 
area and throughout the new-tropics. The Committee notes that 
the Center receives matching private financing for this 
project.

        ECONOMIC GROWTH: COLLABORATIVE RESEARCH SUPPORT PROGRAMS

    The Committee supports the continuation of the 
collaborative research support programs (CRSPs) and urges USAID 
to increase funding for the CRSPs in fiscal year 2004. The 
Committee believes that CRSPs, such as the Peanut CRSP 
established in 1982, are clearly one of USAID's best 
investments, funding for which should be increased rather than 
reduced. The Committee notes that agricultural research and 
development has led to greater economic development, increased 
income, and a more available food supply for the world's poor. 
The Committee is also aware of a cereals genome initiative in 
conjunction with the International Agricultural Research 
Centers that merits support within the biotechnology sector. 
The Committee directs that the Cooperative Development Research 
Program, which funds collaborative research projects involving 
scientists from developing countries and Israel, be funded at 
the same level as in fiscal year 2003.

                    ECONOMIC GROWTH: MICROENTERPRISE

    Microenterprise, while unable to alter economic indicators 
on a national scale, can significantly improve personal and 
family incomes, thus providing money for school fees, health 
supplies, and more nutritious food, and stimulating economic 
growth at the community level. The Committee expects USAID to 
strive to achieve the authorization level enacted by Public Law 
108-31. Furthermore, in order to maximize service delivery to 
poor clients, the Committee directs USAID to take all necessary 
measures to preserve the viability of the leading long-serving, 
private NGO Microfinance Networks, and to report to the 
Committee, not later than 60 days after enactment of this Act 
on its efforts in this regard.

                              AFGHANISTAN

    The Committee has included a general provision (section 
523) on funding for Afghanistan. The Committee understands that 
the lack of USAID staff on the ground and the continued 
challenges posed by the poor security situation in Afghanistan 
have resulted in a significant amount of United States-funded 
reconstruction activities being financed through large-scale 
contracts with multinational NGOs and for-profit development 
implementers. The Committee is concerned by the long-term 
implications of this situation, particularly the consistent 
lack of opportunities for small, Afghan-led NGOs--and 
particularly women-led NGOs--to improve their technical 
expertise and development delivery capacity. The Committee 
directs USAID to establish a contracting mechanism for the 
disbursal and monitoring of technical assistance and small 
grants to such NGOs, and to report back to the Committee no 
later than 60 days after the enactment of this act on progress 
made toward this goal.
    The Committee notes that Afghanistan's women continue to 
struggle to achieve the basic rights they lost during the 
Taliban period, and were severely affected by their inability 
during that time to attend school, hold jobs, and travel 
outside their homes. The Committee urges implementers of 
programs in Afghanistan to carefully integrate Afghan women 
into activities related to development and reconstruction, and 
believes that, in order to complement the overall effort, there 
should be a specific focus on strenthening Afghan women-led 
institutions and organizations. The Committee urges the State 
Department Coordinator of Assistance to Afghanistan and USAID 
to devote not less than $10,000,000, of which $5,000,000 should 
be derived from funds appropriated in this Act, to support 
Afghan women. All such activities should be coordinated with 
Afghanistan's Ministry of Women's affairs, and, where feasible 
and consistent with United States accounting standards, through 
the Ministry. The Committee reiterates its expectation that 
Women's Centers will be built and equipped in 17 regional 
center and will provide legal and protective services, computer 
and literacy classes, and vocational cources.

               LATIN AMERICA AND THE CARIBBEAN: OVERVIEW

    The Committee is pleased that USAID has responded to report 
language from prior years urging that greater emphasis be 
provided for programs in Latin America and the Caribbean. The 
Committee reiterates its intention that the allocation of funds 
for this region from Development Assistance and the Economic 
Support Fund should not be substantially less than the combined 
level for both accounts in fiscal year 2003.
    The Committee notes with approval that the current 
President of Nicaragua has launched a wide-ranging anti-
corruption campaign and deserves strong support from the United 
States. His government has indicted a former President and many 
high ranking former government officials. The current President 
and his administration have worked with the assistance of 
United States Department of Justice in regard to several of 
these investigations. The Committee urges the Administration to 
increase its assistance to Nicaragua to help demonstrate that 
making a major stand for rule of law and against corruption 
brings concrete benefits to developing nations.
    The Andean and Central America/Caribbean regions, 
especially, would continue to benefit from trade capacity 
building assistance, including that related to agricultural 
exports.

             LATIN AMERICA AND THE CARIBBEAN: CONSERVATION

    The Committee strongly reiterates its continued support for 
the USAID Parks in Peril (PiP) program, a partnership with the 
Nature Conservancy which has leveraged more than $300,000,000 
of non-United States Government funds for conservation of 
imperiled ecosystems throughout Latin America and the 
Caribbean. The Committee expects that USAID will continue to 
support this program at not less than recent annual funding 
totals.
    In addition to its on going mission of aiding the under 
developed economies of Latin America, the Committee urges USAID 
to pursue new opportunities for increased cooperation among 
Latin American nations in the area of conservation, especially 
those that may result in additional protection for areas 
located within or near the Pantanal in Brazil, Bolivia, and 
Paraguay.

                LATAIN AMERICAN AND THE CARIBBEAN: HAITI

    The Committee is aware of the ongoing humanitarian crisis 
in Haiti, and urges the Department of State, USAID, and the 
Peace Corps to continue food, health and economic growth 
assistance at not less than the fiscal 2003 levels. In 
particular, job creation assistance, such as aid to artisans 
and craftsmen should be adequately funded, as well as support 
for education.
    The Committee expects the Department of the Treasury to 
support multilateral development bank projects that create and 
rehabilitate infrastructure, especially roads and ports. The 
Committee requests the Departments of State and Treasury to 
provide it within 90 days of enactment of this Act a report 
detailing activities in Haiti, if any, of the Inter-American 
Development Bank and the International Development Association 
of the World Bank, including net flows of resources, and 
liabilities associated with the recent payment of arrears to 
multilateral development banks. The report should also include 
a full assessment progress toward the implementation of 
Organizations of American States Resolution 822, and its impact 
on the economic and humanitarian situation in Haiti.

          LATIN AMERICA AND THE CARIBBEAN: SCHOLARSHIP PROGRAM

    The Committee commends USAID for moving forward to finalize 
a new five-year agreement to continue the Cooperative 
Association of States for Scholarships and to extend this 
successful program to include Mexico. While the agreement calls 
on the Center for Intercultural Education and Development to 
undertake a major new dimension of this program without 
supplemental resources, the Committee understands that work to 
fulfill the added responsibilities is already underway. To 
ensure the program's continued effectiveness, the Committee 
expects USAID to fully implement and fund the new agreement.

                      AFRICA: CONGO RECONSTRUCTION

    After years of civil conflict and occupation by foreign 
African armies, extensive areas of the Democratic Republic of 
the Congo are again relatively free from conflict. The 
Committee urges USAID to expand its health, education and other 
reconstruction efforts in formerly conflictive regions where 
government services are generally absent, especially among 
small and disadvantaged populations in the Inongo district of 
Bandundu region.

                             ASIA: OVERVIEW

    The Committee notes that Asia (beyond the Middle East) is a 
region of paramount strategic and economic importance to the 
United States. This is particularly evident since the events of 
September 11, 2001. The Department of State and USAID are 
encouraged to increase support for programs that enhance the 
status of women in Islamic nations, to support peace 
implementation in Sri Lanka, and to urge the Government of 
Nepal to respect the rights of Tibetan refugees as it seeks 
help to overcome a serious insurgency. The Committee is 
recommending general provisions affecting funding levels for 
Afghanistan, Burma-Thai border programs, and Tibet communities, 
and includes under the heading ``Economic Support Fund'' report 
language addressing funding levels for Mongolia and East Timor.

                    ASIA: ECONOMIC GROWTH ACTIVITIES

    Technical assistance in support of updated commercial 
policies and legal structures also promotes United States trade 
with, and investment in, Asia. This approach to development 
assistance should continue to be a high priority, and the 
Committee again directs the Agency to make available, for a 
fourth year, $60,000,000 for these and other economic growth 
activities. The Committee urges full funding of the Support for 
Trade Acceleration (STAR) program to help implement a bilateral 
trade agreement recently ratified by Congress. The Committee is 
also supportive of regional HIV/AIDS and country programs 
managed from the new Bangkok mission.

              AMERICAN SCHOOLS AND HOSPITALS ABROAD (ASHA)

    The Committee directs USAID to provide up to $20,000,000 
for the American Schools and Hospitals Abroad (ASHA) program in 
fiscal year 2004. The Committee directs that none of these 
funds be reserved for programming in any future fiscal year. 
All funds are to be allocated and obligated in fiscal year 
2004. The Committee further expects that support will be 
continued, as new resources are needed, for traditional 
recipients in the Middle East. The Committee expects USAID to 
keep it currently informed regarding institutions which have 
received ASHA funding in previous years, but which continue to 
have significant unexpended balances. In addition, funds should 
be made available for other deserving institutions in all 
geographical regions, especially in sub-Saharan Africa.

       GLOBAL ISSUES: THE ROLE OF GIRLS AND WOMEN IN DEVELOPMENT

    The Committee recognizes the importance of improving the 
economic and social situation of women and girls through 
respect for legal rights and expanded access to educational 
opportunities, adequate health care, and credit. Over the past 
year, a new initiative in the Near East Bureau at the 
Department of State has allocated significant resources from 
the Economic Support Fund in order to improve the economic and 
social situation of Arab and Middle Eastern women.
    The Committee notes positively recent developments in the 
structure and programs of the Women in Development (WID) office 
aimed at increasing the office's focus on developing multi-
sectoral women-in-development strategies and managing task 
orders to provide technical assistance at the mission level. 
However, personnel shortages in the WID office continue to 
constrain its ability to undertake an ambitious mission, and 
the Committee notes with concern that funding for the WID 
office continues to be allocated from various functions within 
the Economic Growth, Agriculture and Trade Bureau, despite the 
fact that the office should be dealing with issues affecting 
functional and regional bureaus across USAID. The Committee 
urges USAID to maintain funding for the WID office at the 
fiscal year 2003 level of $11,000,000, and directs USAID to 
report not later than 90 days after the enactment of this Act 
on the activities planned for the office in fiscal year 2004, 
and on measures it is taking to staff the office adequately and 
to expand the office's ability to exert Agency-wide influence.

              INTERNATIONAL FERTILIZER DEVELOPMENT CENTER

    The Committee strongly supports the fertilizer-related 
research and development being conducted by the International 
Fertilizer Development Center (IFDC) and urges the 
Administrator of USAID to make $2,300,000 available for the 
core grant to IFDC, a center established to support USAID.

                           DAIRY DEVELOPMENT

    Information provided by USAID indicates that the agency 
recently provided $25,000,000 to development projects 
associated with the dairy industry in developing economies. 
Many of these projects have provided safe, nutritious and 
affordable food to the local populations, fostered growth of 
small businesses through reform of local government policies, 
and empowered stakeholders in projects, especially women, 
through job creation and increased incomes--and continue to do 
so today. Such projects also allow the United States dairy 
industry to be more competitive by promoting American 
technology, equipment, inputs and industry-based technical 
assistance abroad. As USAID continues to develop its priorities 
in developing agricultural capacity around the world, the 
Committee continues to strongly recommend that USAID support 
dairy-related programs.
    The Committee directs USAID to fund such programs at not 
less than $15,000,000 in fiscal year 2004. Of this amount, the 
Committee recommends that at least $7,500,000 be made available 
for new projects at missions supplementing their existing rural 
development programs with a dairy component. These projects 
should facilitate efforts by United States dairy livestock 
businesses and organizations to engage emerging markets in 
developing local sustainable enterprises capable of delivering 
dairy livestock-related goods and services. The Committee 
recognizes the management needs of USAID in overseeing this 
program, and supports the use of a reasonable amount of 
operating expenses by the Economic Growth, Agriculture and 
Trade Bureau to meet its administrative burden.
    The Committee requests USAID to provide a report not later 
than March 31, 2004, outlining its actions in meeting the above 
directives, and advises the Agency to be more rigorous in its 
determination of which projects comply with this directive.

                       TORTURE TREATMENT CENTERS

    Supporting treatment centers as permanent national 
institutions is the best way of providing treatment services to 
victims of torture and advocating for the elimination of 
torture globally. Accordingly, the Committee again recommends 
$10,000,000 for USAID to support foreign treatment centers for 
victims of torture as authorized by the Torture Victims Relief 
Act and the Torture Victims Relief Reauthorization Act of 1999.

       UNITED STATES UNIVERSITY SUPPORT FOR DEVELOPING COUNTRIES

    The Committee continues to receive numerous requests to 
fund specific activities at or through American institutions of 
higher education. The Committee strongly supports activities 
that advance international development and United States 
foreign policy goals. The Committee has reviewed the concepts 
proposed for funding, and recommends that USAID and/or the 
Department of State (as appropriate for the proposed project) 
actively consider proposals submitted by the following 
organizations.
    Unless a proposal demonstrates a unique, innovative, or 
proprietary capability, or demonstrates special considerations 
that justify limited or non-competitive treatment, the 
Committee expects that competitive procedures will be applied 
with regard to the proposals on the list that follows. The 
Committee also expects USAID to give priority to proposals that 
have technical merit, realistic budgets, and achievable 
objectives.
    No later than March 12, 2004, the Agency for International 
Development shall submit a report to the Committee on the 
status of each activity identified below. Such report shall 
include: (1) the status of a funding proposal by the 
organization associated with each activity; (2) the degree to 
which the proposal is consistent with United States development 
assistance and foreign policy goals for the country or region 
in which the activity would take place; (3) the degree to which 
matching or other funds would be provided by the organization 
to complement the Federal contribution; (4) to the extent known 
at the time, any decision by USAID or the Department of State 
on funding the activity, including the proposed funding level; 
and (5) any other relevant information deemed important by 
USAID or the Department of State. The Committee also expects to 
receive a second report on the status of these proposals no 
later than September 6, 2004. In addition, the Committee 
requests that USAID identify an office or organization within 
the agency, or within the Department of State if appropriate, 
to which inquiries can be directed on the status of these 
proposals.
    With the foregoing in mind, the Committee recommends the 
following proposals for USAID's active consideration:
          Proposals by Loma Linda University to expand its 
        medical education and health care programs in 
        developing countries;
          A proposal by the National Center for Computational 
        Hydroscience and Engineering (NCCHE) at the University 
        of Mississippi to transfer state of the art modeling 
        technology to Belize through programs to enhance 
        waterways navigation safety, flood prediction and 
        prevention, water resources engineering, environmental 
        and ecological impact assessment, and soil 
        conservation;
          A proposal by Tulane University and African 
        institutions to expand multidisciplinary research 
        centers in malaria-infested regions of Africa to 
        develop improved responses to the reemergence of 
        malaria;
          A proposal by the University of Wisconsin Stevens 
        Point, Global Environmental Management Program, to 
        develop responsible and sustainable ecotourism 
        programs;
          A proposal by Texas A&M; University and other Alabama 
        and Texas institutions of higher learning to expand 
        research in the United States, Ghana and other 
        cooperating countries to further refine the technology 
        for remediating the effects of mycotoxins in food and 
        feed;
          A proposal by San Diego State University to develop 
        the South Asia Water Resources Program to promote 
        efficient use of water through agriculture sector 
        training and transnational cooperation on the efficient 
        use of shared water resources;
          A proposal by the University of North Carolina-Center 
        on North Carolina-Mexico Relations for activities to 
        improve education, health, and environmental services 
        in Mexico;
          A proposal by Chestnut Hill College in Pennsylvania 
        for a distance learning and exchange program in 
        Ukraine;
          A proposal by South Dakota State University to 
        provide agricultural exchanges with institutions in 
        China, the Russian Federation and Kazakhstan;
          A proposal by Louisiana State University-School of 
        Law to support intra-hemispheric trade;
          A proposal by Bemidji State University in Bemidji, 
        Minnesota to create a Central Asian Institute to 
        facilitate cross-cultural understanding and enhance the 
        education of citizens in Central Asia;
          A proposal by San Francisco State University to 
        coordinate the activities of major actors in AIDS 
        research, prevention, and treatment in Africa, evaluate 
        program effectiveness, and develop a baseline of best 
        practices;
          A proposal by the University of Alabama at Birmingham 
        School of Public Health, the Johns Hopkins School of 
        Public Health and Hygiene, and the Gorgas Memorial 
        Institute for Tropical and Preventive Medicine, Inc. to 
        continue their tuberculosis control programs in Russia, 
        Latin America, Southeast Asia, and South Africa;
          A proposal by the University of Alabama at Birmingham 
        School of Public Health to develop an effective HIV-1 
        vaccine;
          A proposal by West Virginia University to train 
        developing country journalists;
          A proposal by the Kroc Institute for International 
        Peace Studies at the University of Notre Dame to 
        support regional religious and cultural institutions in 
        non-violent solutions to problems in Muslim societies;
          A proposal by the University of Nebraska Medical 
        Center to train health professionals in developing 
        countries through its Center for International 
        Internet-Based Health Professions' Education;
          A proposal by George Mason University to develop an 
        academic center of excellence for the trade capacity 
        building technical assistance;
          A proposal by Florida A&M; University to fund a 
        distance learning education program in Ghana;
          A proposal by the John Joseph Moakley Center for Law, 
        Justice, and Human Rights at Boston College to support 
        programs that promote justice and human rights around 
        the world through the College's undergraduate and 
        graduate international programs;
          A proposal by the Asian University for Women to 
        provide higher education opportunities for women from 
        Muslim nations;
          A proposal by Middle Tennessee State University to 
        work with the University of Durban, South Africa on a 
        program to improve the quality of life for those 
        affected by HIV/AIDS and to reduce HIV transmission 
        through prevention strategies;
          A proposal by the University of the Middle East in 
        Cambridge, Massachusetts, for programs to promote 
        academic excellence, regional cooperation, and 
        tolerance among Muslim, Christian, and Jewish scholars 
        from the Middle East region;
          A proposal by Educational Advancement Alliance on 
        behalf of the proposed Caribbean American Mission for 
        Education Research and Action initiative to elevate the 
        condition of people of the Caribbean using United 
        States expertise in educational methodologies as the 
        major vehicle;
          A proposal by Columbia University's International 
        Research Institute for Climate Prediction to strengthen 
        local capabilities to assess, forecast, and reduce 
        risks posed by floods and drought in southern Africa, 
        devise an integrated basin management approach for 
        major river systems in southern Africa, and mitigate 
        the effects of extreme climate events on disease and 
        famine in West Africa;
          A proposal by the University of Florida to 
        collaborate with Latin American and Caribbean 
        universities to strengthen rule of law in the region;
          A proposal by the University of Miami-Institute for 
        Cuban and Cuban American Studies to participate in the 
        Cuban Transition Project; and
          A proposal by Brandeis University-Andrei Sakharov 
        Archives and Human Rights Center to collect and 
        preserve documents related to the life of Andrei 
        Sakharov.

              International Disaster and Famine Assistance



 

Fiscal year 2003 level................................      $288,115,000
Emergency supplemental funding........................       143,800,000
Fiscal year 2004 request..............................       235,500,000
Committee recommendation..............................       315,500,000


    The Committee recommends $235,500,000 for the International 
Disaster Assistance account and an additional $80,000,000 for 
famine relief, prevention, and mitigation. When taken together, 
the recommended level is $80,000,000 above the request and 
$27,385,000 above the fiscal year 2003 enacted level excluding 
emergency supplemental funding.
    The Committee again requests two one-time reports from the 
Administrator of USAID: within 30 days of enactment of the Act, 
a report on the planned allocation of International Disaster 
and Famine Assistance funds, including an appropriate amount 
for reconstruction activities proposed to be undertaken for 
victims of natural disasters; and within 90 days of enactment, 
a report on the Agency's recommendations for future budgeting 
for developmental relief to alleviate ongoing complex 
humanitarian disasters, such as in Sudan and Liberia, from the 
disaster assistance and other USAID-managed accounts.
    The Committee is especially concerned about the dire 
humanitarian situation in Liberia and neighboring countries of 
West Africa, and asks that the highest possible level of 
support be provided for local private non-governmental 
organizations, including faith-based relief organizations such 
as the those under the patronage of the Archdiocese of Monrovia 
that have persevered through decades of civil conflict.
    The Committee urges the State Department and USAID to 
consider the use of microprocessor-controlled mobile factories 
with the capability to construct buildings and shelter as part 
of reconstruction efforts in Afghanistan and Iraq, and for 
relief and military requirements in Jordan. This equipment has 
multiple potential applications for these and other programs, 
such as infrastructure development, reconstruction, national 
disaster response, and humanitarian relief.
    The Committee does not include funding for two new 
initiatives in the request: the Famine Fund and the United 
States Emergency Fund for Complex International Crises. The 
Committee notes the absence of a budget justification for the 
requests in fiscal year 2004, but given the desperate need for 
food assistance especially in Africa, the Committee has 
recommended funds to be appropriated to USAID and to be 
administered by USAID. The Committee expects full consultation 
on the use of these funds on a periodic basis or as funds are 
obligated.

                         Transition Initiatives



 

Fiscal year 2003 level................................       $49,675,000
Fiscal year 2004 request..............................        55,000,000
Committee recommendation..............................        55,000,000


    The Committee recommends $55,000,000 for this account, as 
requested by the President. The Committee does not preclude 
USAID's Office of Transition Activities (OTI) from using 
resources transferred from other development accounts in this 
Act. Also, the Committee requests that USAID report on a semi-
annual basis the expenditure and specific use of funds by OTI.

                      Development Credit Authority


                     (INCLUDING TRANSFER OF FUNDS)

                            PROGRAM ACCOUNT


 

Fiscal year 2003 level................................
    (by transfer).....................................     ($24,500,000)
Fiscal year 2004 request..............................
    (by transfer).....................................      (21,000,000)
Committee recommendation..............................
    (by transfer).....................................      (21,000,000)


                        ADMINISTRATIVE EXPENSES


 

Fiscal year 2003 level................................        $7,542,000
Fiscal year 2004 request..............................         8,000,000
Committee recommendation..............................         8,000,000


    The Committee recommends a ceiling of $21,000,000 on the 
amount that may be transferred from bilateral economic 
assistance accounts for the subsidy cost of loan guarantees 
under the Development Credit Authority program.
    The Committee recommends $8,000,000 for administrative 
expenses, the same as the requested level.

     Payment to the Foreign Service Retirement and Disability Fund



 

Fiscal year 2003 level................................       $45,200,000
Fiscal year 2004 request..............................        43,859,000
Committee recommendation..............................        43,859,000


    The Committee has provided the budget request for the 
mandatory payment to the Foreign Service Retirement and 
Disability Fund.

   Operating Expenses of the United States Agency for International 
                              Development


                     (INCLUDING TRANSFER OF FUNDS)


 

Fiscal year 2003 level................................      $568,282,000
Emergency funding.....................................        24,500,000
Fiscal year 2004 request..............................       604,100,000
Committee recommendation..............................       604,100,000


    The Committee has recommended funding for United States 
Agency for International Development operating expenses at a 
level of $604,100,000, which is the same as the 
Administration's request. The Committee recommends bill 
language providing that $30,000,000 of the fiscal year 2004 
appropriation remain available until September 30, 2005. The 
Committee also has recommended bill language clarifying that 
the Secretary of State may make transfers between accounts for 
USAID administrative expenses pursuant to sections 109 and 610 
of the Foreign Service Assistance Act of 1961. The Committee 
has included a provision requiring USAID to notify the 
Committee in advance of opening any new mission overseas and of 
any capital construction of missions or purchase or long-term 
lease of offices. The reporting requirement also applies to 
funds appropriated under the heading ``Capital Investment 
Fund''. The Committee notes that the report language under the 
heading ``International Narcotics Control and Law Enforcement'' 
regarding future purchases of vehicles applies also to USAID.

                            HUMAN RESOURCES

    The Committee continues to be concerned that under the 
existing account structure and conventions USAID is unable to 
adequately address its current and future human resource 
requirements that must be met if the Agency is to continue to 
play a key role in meeting rapidly evolving foreign policy 
challenges. Specifically, the Committee is informed that the 
Agency is unable to align the deployment of personnel and staff 
(irrespective of hiring status) with agency priorities, 
resources, and budget preparation processes. The lack of this 
capability appears to have directly impacted the Agency's 
ability to shift USAID personnel to Afghanistan and Iraq. In 
both countries, humanitarian and reconstruction assistance 
forms an important part of the strategy to support the interim 
Afghan government and the Coalition Provisional Authority. In 
this bill, the Committee is taking steps to enable USAID to 
update and align its human resources structure with current and 
anticipated requirements.
    If the recommended changes are enacted, USAID will continue 
to face tremendous human resource challenges, both in light of 
a scale-up of efforts to fight the HIV/AIDS pandemic as well as 
the natural progression of retirements within the Agency. By 
2007, almost 60 percent of the United States direct hire 
foreign service personnel will be eligible for retirement. In 
the same year, thirty percent of the Agency's civil service 
personnel will be eligible for retirement, an amount three 
times what it is today.
    The Committee notes the important work of USAID's Overseas 
Workforce Group and, to advance its efforts, requests a report 
analyzing mission and regional workforce trends overlaid 
against foreign assistance levels. The analysis should be 
provided not later than 120 days after enactment of this Act. 
For each regional bureau and country mission, the Committee 
asks the Agency to analyze trends in employee types (direct 
hire, foreign service or third country nationals, personal 
service contractors, other United States Government personnel) 
and levels of foreign assistance during the preceding three 
fiscal years, and as projected in the fiscal year 2004 request 
as modified by the enacted version of this Act. By mission and 
regional bureau, the report should comment on the correlation 
between overall program size, complexity of acquisition and 
award management, and the number or type of employees engaged 
in program administration. Relative to best practices or 
employee/program ratios, the report should comment on 
differences in program dollars, strategic objectives, or type 
of third party implementer and a mission's workforce size. The 
Committee is especially concerned that mission mode and size 
may be more attributable to historic patterns of staffing than 
current or future program realities. Both the Office of 
Management and Budget and the General Accounting Office (GAO) 
have criticized USAID for the absence of any apparent rational 
allocation process for staff resources. The Committee is aware 
of USAID's efforts to address this situation and seeks to 
develop a better understanding of existing workforce trends.
    The Committee has recommended several changes to better 
align USAID support resources with programs, and has sought to 
provide flexibility so that USAID management will be better 
able to meet the development assistance challenges of the 
future. For example, in section 525, the Committee has included 
bill language allowing USAID to use temporary Foreign Service 
Office (FSO) appointments overseas, funded by program accounts, 
so the agency will employ FSO's responsible to the 
Administrator and the USAID management structure, rather than 
the current tendency to hire and rely on Personal Service 
Contractors (PSCs). These PSC's are too often entrusted with 
managing USAID's Foreign Service National workforce and, in 
some cases, managing the entire United States foreign 
assistance programs in countries, including representing the 
United States in discussion and negotiations with foreign 
governments. The Committee believes that these duties are more 
appropriately under the purview of USAID direct hire employees 
and has provided authority to hire up to 85 more such employees 
in fiscal year 2004.
    Finally, the Committee notes that significant resources for 
``readiness enhancements'' have been proposed by the 
Administration, and approved by Congress, for the U.S. 
Department of State, including additional FSO positions to: (1) 
allow adequte professional and technical training; (2) provide 
for an adequate rotation base for overseas tours; and (3) 
create a cadre of new employees--FSO's, Presidential Management 
Interns, and others--who can provide vision and lead the 
Department of State forward in the 21st century. The Committee 
believes the same type of modernization and forward thinking is 
needed for USAID readiness and America's development assistance 
programs. In the same way it focused on the human resources of 
the Department of State, the Committee urges the Administration 
to send forward a proposal to modernize the USAID workforce and 
streamline personnel systems as part of the fiscal year 2005 
President's Budget submission.

    CONCERNS ABOUT CONTRACTING AMONG PVOS, COOPERATIVES, AND SMALL, 
                    DISADVANTAGED AND MINORITY FIRMS

    As USAID's personnel shortfall and major reconstruction 
projects in Afghanistan and Iraq prompt the Agency to 
increasingly rely on large contractors to administer smaller 
grants and cooperative agreements, the Committee is aware of 
the difficult adjustment facing many of USAID's long-serving 
and effective implementing organizations, especially private 
voluntary organizations (PVOs), microenterprise networks, 
cooperatives, and small, disadvantaged and minority firms. 
While the Committee remains supportive of the prudent use of 
indefinite quantity contracts and greater competition and 
accountability, it seeks to help resolve the perceived crisis 
among USAID's existing PVO, cooperative, and small, 
disadvantaged and minority implementing agents. Until the 
serious concerns of USAID's smaller traditional and current 
contractors and grantees are more fully addressed, the 
Committee requests USAID to suspend its major outreach effort 
to train additional firms on how to compete for additional 
awards and contracts. Under the current circumstances, such 
training would not be an efficient use of scarce Development 
Assistance or Operating Expense funds.
    An important component of USAID's ongoing efforts to 
improve operations within its Office of Procurement is outreach 
to small, disadvantaged and minority contractors and grantees. 
The Committee is aware of initiatives to train minority firms 
in leading US export cities to better compete for USAID awards, 
and requests that sufficient resources be allocated over the 
next two years to train small, minority, and disadvantaged 
firms in leading export cities for such purposes.
    The Committee recommends that those entities competing for 
the training contract have prior experience in working with 
small, minority and disadvantaged firms in increasing their 
ability in doing business in the international arena.
    The Committee is also aware that USAID maintains a national 
database of qualified small, disadvantaged, and minority firms. 
This database should be expanded to include firms who benefit 
from the outreach initiative. In addition, information from the 
database should be disseminated on a regular basis to all USAID 
overseas missions, relevant Washington, DC staff, and USAID 
prime contractors.

                    COMPETITIVE CONTRACTS AND AWARDS

    Although the Committee recognizes that waivers of federal 
acquisition rules regarding fair and open competition are 
sometimes necessary, it also believes such waivers should be 
infrequent and issued in a fully transparent manner. Elsewhere 
in this report, language encouraging competition is found, and 
a new general provision, section 572, addresses competition for 
resources of the ``Iraq Relief and Reconstruction Fund''. The 
Administrator of USAID is requested to provide the Committee an 
annual report not later than four months after the end of the 
fiscal year, on the extent and detail during the preceding 
fiscal year of USAID's sole-source and limited-competition 
awards for contracts, cooperative agreements, and grants in 
excess of $100,000.

                        Capital Investment Fund





Fiscal year 2003 level................................       $42,721,000
Fiscal year 2004 request..............................       146,300,000
Committee recommendation..............................        49,300,000


    The Committee is recommending $49,300,000 for the Capital 
Investment Fund for fiscal year 2004, $6,579,000 above the 
fiscal year 2003 level and $97,000,000 less than the request. 
In addition, $67,000,000 is earmarked under the Economic 
Support Fund for USAID capital facilities located on United 
States Embassy compounds. In total, the Committee 
recommendation includes $96,300,000 for USAID facilities. These 
buildings will provide secure space for USAID employees and 
contractors, and greater safety against terrorist attacks. It 
will enable USAID to comply with relocations to Embassy 
compounds required by the 2001/2002 Foreign Relations 
Authorization Act.
    The Capital Investment Fund is intended to provide USAID 
with the funds for overseas construction and related costs, and 
for the procurement and enhancement of information technology 
and related capital investments. Funds would remain available 
until expended and are in addition to funds otherwise available 
for such purposes.

                          FINANCIAL MANAGEMENT

    The Committee recognizes that the Office of Inspector 
General (OIG) was able to issue opinions on January 27th, 2003 
on all five principal financial statements of USAID for fiscal 
year 2002. In the case of four of the statements, the OIG 
opinion was unqualified, an outcome characterized as 
significant progress by the OIG.
    Despite this progress, the Committee remains deeply 
concerned about the status of agency financial management. The 
OIG noted that the opinions were attained only through 
extensive data testing, extra-ordinary staff efforts, and 
expensive contractor resources. As it did in fiscal year 2003, 
the Committee again notes that the underlying critical issue 
does not relate to the Inspector General's ability to provide 
clean, unqualified audits of agency operations. The paramount 
issue is the fact that agency managers do not have the ability 
to obtain timely, reliable, and complete financial and 
performance data on foreign assistance programs on a consistent 
basis.
    As part of USAID's effort to address this issue, the 
Committee provides $20,000,000 in fiscal year 2004 as requested 
in the Capital Investment Fund for information technology 
improvements. These funds will facilitate deployment of Phoenix 
pilot projects in field missions.
    By October 10th, 2003, the Committee requests a report on 
the status of the planned rollout of the agency's integrated 
financial management system. This report should include the 
identification of selected pilot sites for Phoenix testing, a 
timeline providing project mile stones--including necessary 
approvals by Office of Management and Budget or input from the 
Department of State, a projected cost of system rollout, and a 
description of key issues affecting implementation. The 
Committee expects that such a report will be written with an 
assessment of computer/telecommunications infrastructure of 
USAID missions and characterize key interface requirements 
necessary for any future Procurement System Improvements 
Project. The Committee notes that a report specifically on the 
Phoenix pilot program was not submitted as requested in the 
Committee's report last year.
    Thirty days after completion of each pilot or pilots, the 
Committee requests a brief assessment of the outcome, 
implications for the roll out of the Phoenix system, and any 
updates in the project timeline or key issues affecting 
implementation.

                    PROCUREMENT IMPROVEMENT EFFORTS

    Consistent with the President's request, the Committee 
provides $4,000,000 as requested in the Capital Investment Fund 
to commence a project for an overseas deployment of a web based 
procurement system that will provide a common agency wide 
system for the acquisition and award process. In last year's 
report, the Committee urged USAID to develop a worldwide 
procurement tracking system that would allow the agency to 
regularly evaluate its procurement process and ultimately allow 
data to be integrated into its financial management system. As 
a result, the Committee anxiously awaits the details of the 
Procurement System Improvement Project (PSIP). Not later than 
90 days after enactment of this Act the Committee requests a 
report that comprehensively describes the procurement 
challenges the agency faces, the objectives of the PSIP, and a 
detailed project timeline in fiscal years 2004 and 2005. In 
addition, this report should describe the necessary interface 
requirements (or decisions necessary) between any future 
Acquisition and Assistance system (designed to replace the New 
Management Systems legacy) and a fully deployed Phoenix system. 
The Committee expects that any and all PSIP decisions that 
impact integration with the financial management system will 
occur by January 16th, 2004. The Committee should be kept 
apprised of any delays in the procurement system project that 
impact pilot testing of the Phoenix software.

                           EMBASSY FACILITIES

    In fiscal year 2004 the budget proposes $20,000,000 for 
USAID information technology systems, including increases for 
financial management and procurement systems. An additional 
$126,300,000 is requested for USAID Embassy facilities in 
Uganda, Cambodia, Guinea, Mali, Zimbabwe, Armenia, and Georgia. 
The Committee notes that the Department of State budgets for 
its own requirements and for all other Federal agencies (e.g., 
Justice, Commerce, Defense, Agriculture, etc) in its Embassy 
Security, Construction, and Maintenance account. However, USAID 
is the only Federal agency that has been proposed to be funded 
outside the State Department foreign building account, through 
funding in this Foreign Operations, Export Financing and 
Related Programs bill. In the fiscal year 2004 budget request, 
the Administration has proposed funding Embassy facilities for 
USAID through both this Foreign Operations, Export Financing 
and Related Programs bill ($126,258,000) as well as the 
Commerce, Justice, and State, the Judiciary and Related 
Agencies bill ($62,283,000). The Committee has remained 
concerned that the State Department's approach requires the 
reduction of foreign assistance to finance operational/capital 
costs, and it treats USAID unfairly vis-a-vis other 
international affairs agencies.
    In fiscal year 2005, the Executive Branch will begin yet a 
different approach called the Capital Security Cost Sharing 
Program in which all overseas agencies (not only USAID) will be 
expected to make payments to the State Department. These 
payments would be used to build additional secure facilities 
and eliminate the current backlog.
    The Committee recommendation for fiscal year 2004 provides 
$49,300,000 for the Capital Investment Fund. The recommendation 
fully funds the request for information technology and includes 
$29,300,000 to build the USAID facility in Kampala, Uganda. The 
Committee also has included $67,000,000 and bill language under 
the Economic Support Fund to provide the Department of State 
Office of Overseas Buildings Operation funding for USAID 
facilities on United States Embassy compounds in Mali, 
Cambodia, Guinea, and T'bilisi, Georgia.
    All funds made available under the Capital Investment Fund, 
including the obligation of offsetting collections, and the 
capital appropriation in the Economic Support Fund, are subject 
to the regular notification procedures of the Committees on 
Appropriations. The Committee also has included bill language 
under Operating Expenses of the United States Agency for 
International Development that requires Congressional 
Notification before USAID commits to new overseas missions that 
will require additional capital investments.

   Operating Expenses of the United States Agency for International 
              Development, Office of the Inspector General





Fiscal year 2003 level................................       $33,084,000
Fiscal year 2004 request..............................        35,000,000
Committee recommendation..............................        35,000,000


    The Committee has recommended $35,000,000 for the Office of 
the Inspector General of USAID for fiscal year 2004, which is 
the same as the budget request, and $1,916,000 above the fiscal 
year 2003 level. The Committee again commends the Inspector 
General for his cooperation with the Committee in its oversight 
of USAID management. Not later than 120 days after the date of 
the enactment of this Act, the Inspector General of USAID is 
requested to prepare and submit to the Committee a report that 
describes and evaluates the extent to which the task ordering 
process carried out by mission directors of the Agency affects 
the Agency's ability to meet the goals established by the Small 
Business Administration relating to contracting with small 
businesses.

                  Other Bilateral Economic Assistance


                         Economic Support Fund





Fiscal year 2003 level................................    $2,255,244,000
Emergency supplemental funding........................     2,422,000,000
Fiscal year 2004 request..............................     2,535,000,000
Committee recommendation..............................     2,240,500,000


    The Committee recommends a total of $2,240,500,000 for the 
Economic Support Fund (ESF), an amount that is $294,500,000 
below the request and $14,744,000 below the amount enacted for 
fiscal year 2003, excluding emergency supplemental 
appropriations.
    The Committee recommendation assumes a reduction of 
$152,102,000 in economic support for the Camp David countries. 
The recommended amount in the Economic Support Fund for Israel 
is $480,000,000 and $575,000,000 is recommended for Egypt. The 
recommendation includes $250,000,000 for Jordan. These amounts 
are the same as the President's fiscal year 2004 request. In 
addition, the recommendation reflects a reduction of 
$19,600,000 associated with the decision to retain a separate 
appropriations account for the International Fund for Ireland. 
The Administration's budget request included only $8,500,000 
for Ireland within the Economic Support Fund.
    The Committee is also recommending the retention of 
language from the fiscal year 2003 appropriations act 
specifying that policy and allocation decisions for funds 
appropriated under this heading in this Act and in prior acts 
shall be made by the Secretary of State or the Deputy Secretary 
of State and shall not be delegated. The Committee is concerned 
the programs and activities funded through this account 
accurately reflect both the priorities of the Secretary of 
State and the budget justification material provided to the 
Committees on Appropriations, as modified by the Congress. The 
managers reiterate the importance of Congressional intent in 
the programming of funds appropriated to the Economic Support 
Fund and anticipate the continuation of a cooperative approach 
during fiscal year 2004 on funding allocations and programming 
decisions.

                                 ISRAEL

    The Committee is continuing the initiative begun five years 
ago for a phased reduction in economic assistance for Israel 
that will result in the eventual elimination of ``Economic 
Support Fund'' assistance. This proposal was originally made by 
the Government of Israel in response to new economic realities 
in the Middle East. The Committee is also convinced that the 
emerging security threats in the Middle East are significant 
and warrant increasing military assistance to Israel by 
$73,650,000 in fiscal year 2004.
    The Committee therefore recommends not less than 
$480,000,000 in economic support shall be provided for Israel, 
which is $116,100,000 less than the fiscal year 2003 level and 
the same as the President's budget request. The Committee also 
requires in bill language that these funds be provided to 
Israel as a cash grant and that funds be disbursed within 30 
days of enactment of the Foreign Operations, Export Financing 
and Related Programs Act.

                          ISRAEL LAND PROJECT

    The Committee recognizes the contributions of the African 
Hebrew Israelites to Israel, and specifically to the Dimona 
area. The Committee understands that the Government of Israel 
has agreed to extend permanent residence status to the 
community, which will make it eligible for government 
assistance with housing programs. The community, working with 
the Government of Israel, has identified a site for the 
construction of a new housing and community complex, to which 
the Government of Israel has pledged 95 million shekels in 
mortgage assistance. The Committee urges USAID to explore ways 
to help the community complete this project.

                                 EGYPT

    As part of the Committee's ongoing review of Middle East 
aid levels, and as a result of budget constraints affecting the 
international affairs budget, the Committee is recommending 
continuation of a policy of reducing economic support for Egypt 
in a manner which does not inadvertently undermine the guiding 
principles of the Camp David Accords and efforts to enhance 
peace in the Middle East.
    The Committee therefore includes not less than $575,000,000 
in economic support be provided for Egypt on a grant basis, 
which is $36,002,000 less than the fiscal year 2003 level and 
the same as the President's budget request. A cash transfer may 
be provided with the understanding that Egypt will continue to 
implement significant economic reforms.
    The Committee recognizes the importance of environmental, 
educational, and cultural programs funded through the Economic 
Support Fund that have significantly improved the quality of 
life for many Egyptians and strengthened the United States-
Egyptian relationship at the grass-roots level. The Committee 
takes special note of the success of the antiquities program, 
which has helped support Egypt's tourism industry, a major 
source of foreign exchange. The Committee therefore strongly 
urges USAID to continue its support for these programs in 
fiscal year 2004.
    The Committee continues to be concerned about persistent 
poverty in Upper Egypt. The Committee appreciates special 
efforts that USAID has made to focus on community and economic 
development as well as education and women's programs in this 
special region. The Committee, however, believes that much more 
needs to be done and urges the Department of State and USAID to 
place renewed emphasis and allocation of assistance in the 
Governorates of Minia, Asint, and Sohag. The Committee requests 
USAID to report back not later than February 2, 2004, on the 
allocation or funds by program and regional area.

                           CAMP DAVID ACCORDS

    The Committee emphasizes once again that the recommended 
levels of assistance for Israel and Egypt are based in great 
measure upon their continued participation in the Camp David 
Accords and the Egyptian-Israeli peace process.

                          NON-MILITARY EXPORTS

    The Committee strongly urges the President to ensure, in 
providing cash transfer assistance to Egypt and Israel, that 
the level of such assistance does not cause an adverse impact 
on the total level of non-military exports from the United 
States to each such country.

                       ECONOMIC BOYCOTT OF ISRAEL

    The Committee has once again included language in the bill 
addressing the Arab League boycott of Israel under section 535 
of this Act. The Committee strongly opposes this boycott and 
believes that the Department of State must take strong action 
to combat this practice. This recommended bill language 
includes modifications first made two years ago to urge that 
Arab League members normalize relations with Israel.

                                 JORDAN

    The Committee recommendation includes $250,000,000 for 
Jordan. The Committee notes appreciation for that nation's 
strong support for the United States and our military forces 
during the recent conflict in Iraq. Jordan has played a 
leadership role in facilitating the Road Map for peace between 
Israelis and Palestinians. Jordan's regional leadership was 
recently recognized when the World Economic Forum was held at 
the Dead Sea and Amman. The Committee notes that ESF assistance 
will help Jordan deal with economic impacts from increased oil 
prices, and it will help the Kingdom continue to modernize 
information technology investments and education.

                       WEST BANK AND GAZA PROGRAM

    The Committee recommendation for the West Bank and Gaza 
program continues language that prohibits funds in this Act 
from being obligated or expended directly to the Palestinian 
Authority (section 552), unless a waiver is submitted by the 
President. As an outcome of the United States-led Road Map for 
peace between Israel and the Palestinians, the Administration 
recently indicated its intention to use waiver authority and to 
provide fiscal year 2003 supplemental appropriations to the 
Palestinian Finance Ministry. This assistance, in the form of a 
cash grant, would combine with tariff collections released by 
the government of Israel to the Palestinian Finance Ministry 
and would be used to repair damage in the West Bank and Gaza. 
The Committee reiterates that the Secretary of State must 
ensure that United States funds are not unintentionally 
diverted to fund Palestinian leaders and organizations opposed 
to United States security interests and the peace process. The 
Committee has again included section 560 that requires the 
Secretary of State to exercise oversight and ensure that 
assistance is not diverted to individuals and entities that 
engage, have engaged, advocate or sponsor terrorist activity.
    In addition, in order to maintain proper oversight of 
grants and contracts issued under the West Bank and Gaza 
program, the Committee is recommending bill language requiring 
annual audits of all contractors and grantees, and significant 
subcontractors and subgrantees. Recommended bill language 
provides up to $1,000,000 for the Inspector General of the 
United States Agency for International Development for audits, 
inspections, and other activities in furtherance of this 
provision.
    The Committee acknowledges that one of the primary 
objectives of the West Bank and Gaza program is to create 
viable infrastructure in Palestinian Authority-controlled areas 
to ensure the health and welfare of the Palestinian people. Al 
Quds University, in cooperation with the Kuvin Center for 
Infectious Diseases of the Hebrew University of Jerusalem, has 
proposed the establishment of a regional health and disease 
program, which would work to build an effective infrastructure 
to deal with serious health and disease problems among the 
Palestinian people. The Committee understands that cooperative 
programs of this nature are rare in the current environment, 
and urges USAID to work, through the West Bank and Gaza 
program, to help Al Quds and the Kuvin Center begin this 
initiative. The Committee supports the cooperative nature of 
this program, and urges that it be given consideration for 
Middle East Regional Cooperation program funding.

                            LEBANON PROGRAM

    The Committee believes support for the people of Lebanon 
continues to be in the United States national interest. The 
Committee recommendation provides $35,000,000 for assistance 
for Lebanon for fiscal year 2004; bill language makes not less 
than $4,000,000 of this amount available for American 
educational institutions in Lebanon for scholarships and other 
programs.
    The Committee is aware of the key role that American 
institutions play in Lebanon, in regards to regional stability, 
and extending quality education to the underprivileged. 
Institutions such as the Lebanese American University, American 
University in Beirut, the American Community School, Holy 
Spirit University and the International College help spread 
American ideals and values throughout the country and the 
Middle East.
    The Committee recognizes that Lebanon can never achieve 
full independence until all foreign security and military 
forces are withdrawn, and control is reasserted by the national 
government throughout all of Lebanon, including the south. As 
it did last year, the Committee calls upon Lebanon and Syria to 
adopt a timetable for the complete withdrawal of all Syrian 
forces from Lebanon.

                     MIDDLE EAST REGIONAL PROGRAMS

    The Committee continues to be concerned about issues 
related to water allocation in the Middle East. Since the start 
of peace negotiations in the region, this has been one of the 
most critical issues to resolve, and, given the reality of 
supply and demand, it is not expected to diminish in 
importance. Proposals like the ``Red to Dead'' canal project 
that would provide desalinized water to Jordan, Israel and the 
Palestinians and would restore water levels in the Dead Sea 
have great potential. However, such projects would require 
billions of dollars in infrastructure investment.
    Clearly, the need for fresh water is a reality for all 
parties in the Middle East. Fresh water is essential for 
economic development, agriculture, health, and improving the 
quality of life for everyone in the region. Therefore the 
Committee strongly supports the continued efforts of the 
International Arid Lands Consortium in addressing the critical 
issues of water, energy, and agriculture and land use in the 
Middle East and Central Asia, and urges USAID to make available 
$2,500,000 to the Consortium for this work. These funds are to 
be allocated from bilateral, centrally managed or regional 
programs either in this account or in other accounts funded by 
this Act.
    In addition, the Committee continues to urge USAID to 
provide assistance to the Blaustein Institute for Desert 
Research to investigate the flow and transport of pollutants in 
groundwater. The Institute carries out research on dryland 
environments, required for sustainable uses of the Negev Desert 
and arid areas the world over, and for combating 
desertification in Israel and the Middle East.
    Media is a potent force for political and social change. 
The current situation in the Middle East and throughout the 
Muslim world highlights the need for the United States to 
support independent media and training in fact-based 
journalism. The Committee directs that funds for transitional 
programs in the Arab and Muslim world include funding for 
independent media and training for journalists and other media 
professionals.

                        RELIGIOUS FREEDOM--EGYPT

    The Department of State 2002 International Religious 
Freedom Report notes that while there has been a continued 
trend toward improvement in the Egyptian Government's respect 
for and protection of religious freedom, religious 
discrimination and sectarian violence continue to plague that 
nation. The Committee remains concerned about the continuing 
problems faced by Egypt's Coptic Christian community and 
believes that the Egyptian Government needs to do everything 
possible to provide full opportunity for Coptic Christians in 
employment and educational opportunities. Justice has still not 
been achieved with respect to the perpetrators of violence 
against Christians in the village of Al-Kush in January 2000 
and the Committee hopes that the Egyptian government will 
bolster its efforts in this regard. The Committee expects the 
Department of State to make every effort to reinforce the 
importance of actively enforcing the religious freedoms that 
are, in fact, provided for in the Egyptian Constitution.

                         MEPI/ISLAMIC OUTREACH

    The recommendation includes $45,000,000 for the Middle East 
Partnership Initiative. The MEPI/Islamic Outreach supports an 
array of economic and social reform initiatives in the Middle 
East and non-Arab Islamic countries. The program remains a work 
in progress, and the Department of State recently created a 
MEPI office, funded from resources in the Commerce, Justice, 
and State, the Judiciary and Related Agencies Act.
    MEPI/Islamic Outreach has great potential to further United 
States goals in Islamic countries. However, the program is 
currently defined in only the most general terms and has not 
gone through the type of programmatic and financial review that 
any international or domestic program would be expected to 
undergo by the Office of Management and Budget. Program 
delivery mechanisms are still under development. The level of 
programmatic and financial detail submitted to the Congress is 
not extensive and the program is explained in terms of 
generalizations and goals rather than specifics. Further, the 
Department of State has largely ignored Committee guidance 
provided in the fiscal year 2003 Iraq Emergency Wartime 
Supplemental, regarding allocations between Arab and non-Arab 
Muslim nations, and regarding the prohibition of using funds to 
establish an Enterprise Fund.
    Nevertheless, given the importance of education, training 
and exchanges, especially in improving the role of women, and 
the development of market economies and more professional media 
in Arab and Islamic nations, the Committee recommends that 
$45,000,000 in new funds be provided. In combination with the 
$100,000,000 in unobligated and unspent funds provided in the 
Supplemental, this recommendation provides the Administration 
with a $145,000,000 program in fiscal year 2004.
    The Committee again reiterates in the strongest terms, that 
these funds must be apportioned more equitably between Arab 
Muslim and non-Arab Muslim nations.

                                PAKISTAN

    Of the amounts provided for Pakistan, the Committee has 
recommended bill language that allows $65,000,000 of this 
amount to be used for debt relief.

                           IRISH VISA PROGRAM

    The Committee directs that $6,000,000 be provided for the 
Walsh Visa Program for fiscal year 2004 instead of $4,000,000 
as requested in the President's budget. This program, 
authorized since 1998, assists young people who are residents 
of Northern Ireland and the border counties of Ireland with 
developing job skills and conflict resolution abilities. 
Eligible youth receive non-immigrant visas that enable them to 
work for up to three years in the United States.
    The budget request assumed that the Irish Visa Program 
would end in fiscal year 2004. The House recently reauthorized 
the program to take in new visa recipients through fiscal year 
2006. Accordingly, the Committee recommends that $6,000,000, 
$2,000,000 more than the budget request, be used by the 
Department of State to continue this program that supports 
reconciliation, job skill training, economic development and 
the people of Northern Ireland and the border counties.

                     PHILIPPINE CONFLICT RESOLUTION

    The Committee continues to express support for the 
commitment of the Government of the Republic of the Philippines 
to pursue the war on terrorism, including their efforts to 
commence a comprehensive peace process in Mindanao with the 
Moro Islamic Liberation Front (MILF), the largest armed Muslim 
rebel group in the Philippines. The Committee further 
encourages the use of amounts made available to carry out 
chapter 4 of part II of the Foreign Assistance Act of 1961 
(``Economic Support Fund'') to provide assistance to the 
Republic of the Philippines for this peace process.

                               EAST TIMOR

    The Committee recommends $13,500,000 in ESF for programs in 
East Timor, as proposed in the budget request, to support 
income producing projects and other reconstruction activities. 
$7,500,000 is allocated to the Support for Democratic 
Transition strategic objective, for programs such as 
strengthening government institutions. $6,000,000 is allocated 
to the Economic Revitalization strategic objective, for 
programs such as the ``Cooperative Cafe Timor'' project and 
coffee cooperative activities. In addition, the Committee 
recommends that USAID allocate at least $4,000,000 from the 
Child Survival and Health Programs Fund to commence maternal 
health, malaria, or vulnerable children projects in East Timor.

                                MONGOLIA

    The Committee strongly supports the Administration's 
$10,000,000 request for assistance for Mongolia for fiscal year 
2004.

                                 TIBET

    The Committee recommends that $250,000 be made available 
through a nongovernmental organization, such as the National 
Endowment for Democracy, for the purpose of providing training 
and education of Tibetans in democracy activities, and 
monitoring the human rights situation in Tibet. To the extent 
practicable, the Committee supports the use of these funds for 
activities that have a primary impact inside Tibet. In 
addition, language has been included in section 526 to provide 
$3,000,000 for activities that preserve cultural traditions and 
promote sustainable development and environmental conservation 
in Tibetan communities.
    The Committee is aware that international non-governmental 
organizations have provided valuable assistance to promote 
Tibetan-owned businesses and educational, cultural, and natural 
resource conservation projects in Tibet. Funds are to be 
allocated to the Department of State Special Coordinator for 
Tibetan Issues and that office should utilize the $3,000,000 to 
support the most effective projects in Tibetan communities. The 
Committee believes that it is important to use organizations 
that have a proven track record in working with Tibet and the 
Tibetan people. The Committee expects that competitive 
procedures will be followed with regard to the use of this 
assistance.

                           CHINA RULE OF LAW

    The Committee notes the success of the American Bar 
Association's Rule of Law and Governance Program in China in 
promoting the rule of law and citizens' rights through programs 
in criminal procedure, human rights, land tenure rights, and 
environmental governance. The Committee urges the State 
Department to continue its support for this and similar 
programs which engage key Chinese reformers in programs that 
seek to improve China's criminal justice and commercial law 
systems and protect human rights, including property and 
intellectual property rights.

                               INDONESIA

    The Committee reiterates that the Department of State must 
make every effort to secure the active cooperation of the 
Indonesian government in the investigation of the ambush and 
murder of two and severe wounding of seven American citizens in 
Irian Jaya, New Guinea in August 2002. Although eight months 
have passed since this tragedy, no arrests have been made. Most 
disturbing, the Committee understands that the Federal Bureau 
of Investigation (FBI) has not found Indonesian officials to be 
particularly cooperative.
    The Committee believes that it is critically important to 
move forward aggressively in this investigation. It is 
essential that the perpetrators be brought to justice. The 
importance and severity of this issue to United States/
Indonesian bilateral relations cannot be overstated. It is the 
responsibility of the Administration and the Department of 
State to carry an unambiguous message to the Indoensian 
government that justice must be carried out and cooperation 
with United States law enforcement representatives is 
essential.

                                 CYPRUS

    The Committee recommends $12,000,000, an increase of 
$4,500,000 above the budget request for educational and other 
bicommunal projects in Cyprus, and recommends language similar 
to that included in the fiscal year 2003 Act. These funds 
provide a basis for mutual cooperation and preparation for the 
two communities of Cyprus to live together harmoniously by 
increasing inter-communal contacts. These funds provide funding 
for Fulbright scholarships, the Bicommunal Support Program, the 
United Nations Office for Project Service, and the United 
States Geological Survey, which is developing an island-wide 
water database.

                                  CUBA

    The Committee fully supports the budget request of 
$7,000,000 for the Cuba democracy program and supports its 
goals of promoting democratization, respect for human rights, 
and the development of a free market economy in that country. 
When allocating these funds the Committee expects USAID to 
consider proposals at or through institutions of higher 
education in the United States and expects that competitive 
procedures will be followed with regard to such proposals.

                        TRADE CAPACITY BUILDING

    In fiscal year 2002, the United States government 
programmed nearly $170,000,000 in trade capacity building (TCP) 
assistance through the Economic Support Fund. In fiscal year 
2004, the Committee recommends $194,000,000 for TCP, of which 
not less than $20,000,000 shall be used for the Americas' 
Hemispheric Cooperation Program (HCP) to underscore commitment 
to assist economic integration in the hemisphere.
    In preparation of strategic plans or mission performance 
plans relating to ESF countries or regions that have a special 
or proposed trading relationship with the United States, the 
Department of State should consult with The United States Trade 
Representative's Office for Trade Capacity Building.

                    HUMAN RIGHTS AND DEMOCRACY FUND

    As in fiscal years 2002, 2003, and 2004 the Committee urges 
that, of the funds allocated to the Human Rights and Democracy 
Fund, $1,000,000 should be provided to support the Reagan/
Fascell Democracy Fellows Program of the National Endowment for 
Democracy to enable activists, scholars, journalists, and 
practitioners from around the world to help make contributions 
to the strengthening of democracy in their respective 
countries. This program was authorized in section 104(a)(2)(B) 
of H.R. 3427 as enacted into law as part of Public Law 106-113. 
If insufficient funds are available within the Human Rights and 
Democracy Fund, another funding source within the Economic 
Support Fund should be identified by the Department of State.
    The Committee also strongly recommends that $1,000,000 be 
made available in fiscal year 2004, as in fiscal year 2003, for 
democracy programs in China through the National Endowment for 
Democracy (NED). Additional funding for worldwide democracy 
activities through the NED should be allocated at the fiscal 
year 2003 level from the Human Rights and Democracy Fund with 
the expectation that the budget request for the Fund will be 
increased to accommodate these programs. If the Fund budget is 
not increased commensurate with the needs for these programs, 
ongoing support for these worldwide democracy activities 
(exclusive of $1,000,000 in funding for the China democracy 
programs and $1,000,000 for the Reagan/Fascell Democracy 
Fellows Program) should be allocated from other appropriate 
sources within the Economic Support Fund.
    The Committee further recognizes the key role of the Afghan 
Independence Human Rights Commission (AIHRC) in the areas of 
human rights education, protecting women's and children's 
rights, and monitoring and investigating human rights abuses, 
and recommends that the Department of State provide at least 
$2,000,000 to the Commission in support of its important work.

                          PACIFIC TUNA TREATY

    The Treaty on Fisheries between the United States and the 
governments of certain Pacific Island states, popularly known 
as the South Pacific Regional Fisheries Treaty, requires that 
economic assistance be provided annually to the South Pacific 
states. Therefore, the Committee recommends that the treaty 
obligation be met through the payment of the full $18,000,000 
in fiscal year 2004, as requested by the President.
    The United States enjoys positive and constructive 
relations regarding fisheries with the Pacific Island nations 
that are parties to the South Pacific Tuna Treaty. Since the 
treaty entered into force in 1988, it has become the 
cornerstone of the economic and political relationship with the 
United States and these Pacific Island parties. There is a 
common desire to conserve and manage fisheries resources in the 
South Pacific in a sustainable manner, and this has carried 
over into the multilateral effort to create a conservation and 
management regime for the Western and Central Pacific. Under 
the current Treaty, the United States industry pays an annual 
license fee of $4,000,000 per year.
    The Committee notes that the Treaty has provided 
significant economic benefits to the United States as tuna 
harvested by United States vessels is estimated to contribute 
$250,000,000 to $400,000,000 annually to the United States 
economy; it also provides significant employment in American 
Samoa.
    Associated with the Treaty is the Economic Assistance 
Agreement between the United States and the South Pacific Forum 
Fisheries Agency. Under the current terms of the Agreement, the 
United States provides $14,000,000 per year in Economic Support 
Funds to the Pacific Island nations to be used solely for 
economic stability and security. This assistance is the only 
significant source of United States economic assistance to the 
area other than Compact of Free Association assistance to the 
Federated States of Micronesia, Republic of Palau, and the 
Republic of the Marshal Islands.
    The current agreement expired in June 2003. The Committee 
understands that the President has recommended that the 
Agreement be amended and extended for ten years. The Committee 
recognizes the tremendous value of the fishery and the value of 
the Treaty to United States interests in the Pacific, and hopes 
that the United States Congress will take expeditious action.

                          CONFLICT RESOLUTION

    The Committee recognizes the importance of youth training 
in conflict resolution as a tool for creating a climate of 
peace in regions of conflict. The Committee commends Seeds of 
Peace for its commitment to helping future leaders of the 
Middle East and other regions (such as Cyprus, the Balkans, and 
South Asia) to overcome prejudice, fear, and other obstacles to 
peace, and urges the Department of State to provide $1,000,000 
in fiscal year 2004 to support the important work of this 
organization.
    The Committee supports the work of the Jerusalem 
International YMCA, Middle East Children's Association, and 
Interns for Peace which bring together Muslim, Jewish and 
Christian young people in a positive environment that promotes 
peace, respect, and understanding, and recommends that funds be 
provided for their work.
    The Committee acknowledges the importance of the Middle 
East Regional Cooperation program, particularly in the current 
environment as the Road Map for peace gets underway. The 
Committee has, therefore, provided $6,000,000, an increase of 
$1,000,000 over the budget request for this program.
    The Committee recognizes the Foundation for Environmental 
Security and Sustainability's important contribution to United 
States national security interests. The Foundation's work 
provided the United States and the international policy 
community's critical opportunities to mitigate problems before 
they become crises, and better prepare for crises that cannot 
be avoided. The conflict prevention focus of the Foundation 
provides critical input for the Department of State, the 
Department of Defense, and other Federal agencies in 
prioritizing areas for engagement and technical assistance and 
implementing focused and effective conflict prevention.
    The Committee recognizes Partners for Democratic Change, an 
international non-governmental organization committed to 
building sustainable local capacity to advance civil society 
and conflict management worldwide. Since its inception in 1989, 
Partners has provided vital communication, negotiation, and 
cooperative planning skills to thousands of leaders in nearly 
forty countries. Partners' centers are currently located in 
such nations as Argentina, Albania, Bulgaria, Hungary, and 
Romania.
    The Committee believes that the International Crisis Group 
(ICG) provides high-quality analysis and policy recommendations 
that can help prevent and reduce the level of deadly violence 
resulting from complex crises, and strongly recommends that the 
Department of State provide funding for the ICG to continue its 
research in areas of United States foreign policy interest.

                                 BURMA

    The Committee has included a general provision, section 
531, providing that not less than $6,000,000 from the Economic 
Support Fund should be made available for activities among 
Burmese who have fled to neighboring countries, especially 
Thailand. It is the Committee's intent that ongoing programs 
that largely serve minority groups within and without Burma 
continue with minimal disruption, as the needs are greater than 
in recent years. It urges the Department of State and USAID to 
utilize the $6,000,000 to support the most effective 
nongovernmental organizations (NGOs) working in Burmese 
communities, and expects that competitive procedures will be 
followed, when feasible, with regard to proposals from the 
NGOs. None of the funds may be used to directly benefit the 
unelected central Government of Burma.

                         AVAILABILITY OF FUNDS

    The Committee has continued language that funds in this 
account are to remain available for obligation for two years.

                     International Fund for Ireland





Fiscal year 2003 level................................       $24,837,000
Fiscal year 2004 request..............................       (8,500,000)
Committee recommendation..............................        19,600,000


    The Committee recommends $19,600,000 for the International 
Fund for Ireland in support of the Anglo-Irish Accord. Funding 
for this activity is requested through the Economic Support 
Fund, but the Committee recommendation would restore a separate 
appropriations account for assistance to Ireland. The amount 
recommended is $11,100,000 above the President's budget request 
and $5,237,000 below the fiscal year 2003 level.
    The Committee strongly urges the International Fund for 
Ireland to take every step possible to ensure that all 
recipients of Fund support are promoting equality of 
opportunity and non-discrimination in employment. The Committee 
further urges the Fund to focus on those projects that hold the 
greatest potential for job creation and equal opportunity for 
the Irish people, regardless of class, creed, gender, or 
ethnicity.

          Assistance for Eastern Europe and the Baltic States





Fiscal year 2003 level................................      $521,587,000
Fiscal year 2004 request..............................       435,000,000
Committee recommendation..............................       452,000,000


    The Committee recommends $452,000,000 for Assistance for 
Eastern Europe and the Baltic States, an amount that is 
$67,587,000 below the level provided in fiscal year 2003 but 
$17,000,000 above the budget request. The increase above the 
budget request is intended to ameliorate the level of reduction 
for Montenegro and Serbia which have made significant progress 
in democratization, as well as the reduction for Bosnia.
    The Committee intends that funding for democracy programs 
through the National Endowment for Democracy continue and be 
provided as a transfer of funds pursuant to section 632(a) of 
the Foreign Assistance Act.

                                 KOSOVO

    The Committee has retained language from fiscal year 2003 
requiring that the United States should not provide more than 
15 percent of the resources pledged for Kosovo. In addition, 
bill language is continued from the fiscal year 2003 
appropriations act that would prohibit funding for large scale 
physical infrastructure reconstruction. The Committee 
recommendation includes $70,000,000 for assistance programs in 
Kosovo.

                         BOSNIA AND HERZEGOVINA

    The Committee recommends $46,000,000 for assistance 
programs in Bosnia and Herzegovina, $2,000,000 above the budget 
request and $4,000,000 below fiscal year 2003.
    The Committee has recommended the same bill language as in 
the fiscal year 2003 Act that requires the written approval of 
the Administrator of USAID for loans and projects under the 
Economic Reconstruction Program For Bosnia, authorizes the use 
of local currency funds generated by the Bosnia assistance 
program for programs throughout the region, and authorizes the 
President to withhold funds for economic revitalization for 
Bosnia if he determines that Bosnia is not in compliance with 
the Dayton Accord regarding the presence of foreign forces and 
has not terminated intelligence cooperation with Iranian 
officials. All funds are subject to the provisions of section 
529 of this Act.

                         SERBIA AND MONTENEGRO

    The Committee strongly supports assistance for the Republic 
of Montenegro, and urges the Administration to make every 
effort to assist the Government of the Republic. The Committee 
recommendation includes $35,000,000, a reduction of $5,000,000 
below fiscal year 2003, rather than a reduction to $18,000,000 
as proposed in the budget request. The Committee recommends 
that the increase above the budget request be used for 
addressing significant environmental issues in Montenegro, as 
well as economic development in the coastal region.
    The Committee notes the strong support given by the 
Republic to the foreign policy of the United States during the 
latter years of the Milosovic regime in Serbia.
    The Committee recommendation also provides for continuation 
of democratization initiatives in Serbia and support for the 
successful Community Revitalization through Democratic Action 
or ``CRDA'' program. The Committee recommendation provides 
$100,000,000 for AEEB/USAID programs in Serbia, down from the 
$110,000,000 level provided in fiscal year 2003, but above the 
request of $95,000,000. The Committee notes that Serbia has 
made significant progress on democratic reforms following the 
tragic assassination of Prime Minister Zoran Djindjic, and a 
democratic and peaceful Serbia is a key to stability in the 
Balkans.

                           REGIONAL PROGRAMS

    The committee recommendation includes $53,000,000 for AEEB 
regional programs. This category funds environmental 
infrastructure, independent media support, civil society and 
rule of law, health promotion and care, economic development 
and other programs. While specific amounts are not earmarked 
for the Baltic States consistent with the budget request the 
Committee notes that projects in these nations should continue 
to qualify and operate in Estonia, Latvia and Lithuania.
    As also noted under the Economic Support Fund section of 
this report, the Committee recognizes the importance of youth 
training in conflict resolution, and lessening age-old ethnic 
tensions. The National Albanian American Council (NAAC) has 
created a program that would provide a community supportive 
environment in the United States for children from Albania, 
Kosovo (including Kosovar Serbs), Montenegro, Macedonia and the 
United States in which they would live together and take part 
in a program designed by the NAAC. This program would create an 
environment, a model, of peaceful conflict resolution and 
cooperation in contrast to years of hate and mistrust in the 
Balkans. The Committee urges the Department of State and USAID 
to provide up to $1,000,000 from regional AEEB programs for 
this purpose.

                 LEGAL INITIATIVES AND THE RULE OF LAW

    The Committee encourages the USAID to continue to provide 
financial support for the Central and Eastern European Law 
Initiative (CEELI), a project of the American Bar Association. 
CEELI has received grants to help Central and East Europe and 
the States of the Former Soviet Union create new legal 
frameworks based on the rule of law rather than through party 
doctrine or caprice. This initiative has helped promote 
democracy and the rule of law in 22 nations in Europe and 
Eurasia. CEELI emphasizes long-term engagement country-by-
country and supports projects that facilitate extensive 
consultations with policy-makers, legal scholars, judges, and 
attorneys. The Committee encourages support for this type of 
private sector involvement and recommends that the program be 
maintained at not less than fiscal year 2003 funding levels.
    The Committee strongly supports the USAID-funded program 
for distance learning legal education that has been initiated 
in the Central and East European region, and recommends funding 
for the program in fiscal year 2004 at not less than the level 
provided in fiscal year 2003.

  TRAINING AND EXCHANGES IN THE FORMER SOVIET UNION AND CENTRAL EUROPE

    The Committee continues to support training, exchanges, and 
partnerships between the United States and the nations of 
Eurasia, Central Europe, and the southern tier of Europe. These 
programs are in the interest of the United States and important 
to sustaining democracies. However, the Committee is aware that 
the Administration has decided to transfer many exchange 
programs to the jurisdiction of the State Department Bureau of 
Educational and Cultural Exchange Programs, under the 
jurisdiction of the Commerce, Justice, and State, the Judiciary 
and Related Agencies bill. The Committee strongly recommends 
the Administration provide funding for the Russian, Eurasian, 
and East European Research and Training Program (Title VIII) at 
the fiscal year 2003 level. The Committee also continues to 
support the East Central European Scholarship Program (ECESP) 
and its important work. The Committee recommends the East 
Central European Scholarship Program be continued at not less 
than the fiscal year 2003 level.
    The following chart compares funding levels for this 
appropriation account:

          Assistance For Eastern Europe and the Baltic States


----------------------------------------------------------------------------------------------------------------
                                                                                                    Fiscal Year
                                                                    Fiscal Year     Fiscal Year   2004 Committee
                                                                   2003 enacted    2004 request   recommendation
----------------------------------------------------------------------------------------------------------------
Albania.........................................................     $28,000,000     $28,000,000      28,000,000
Bosnia-Herzegovina..............................................      50,000,000      44,000,000      46,000,000
Bulgaria........................................................      28,000,000      28,000,000      28,000,000
Baltic States...................................................       4,967,000  ..............  ..............
Croatia.........................................................      30,000,000      25,000,000      25,000,000
Kosovo..........................................................      85,000,000      79,000,000      70,000,000
Macedonia.......................................................      50,000,000      39,000,000      39,000,000
Romania.........................................................      29,000,000      28,000,000      28,000,000
Serbia..........................................................     110,000,000      95,000,000     100,000,000
Montenegro......................................................      40,000,000      18,000,000      35,000,000
Regional........................................................      66,620,000      51,000,000      53,000,000
                                                                 -----------------------------------------------
      Total AEEB................................................     521,587,000     435,000,000     452,000,000
----------------------------------------------------------------------------------------------------------------

    Assistance for the Independent States of the Former Soviet Union





Fiscal year 2003 level................................      $755,060,000
Fiscal year 2004 request..............................       576,000,000
Committee recommendation..............................       576,000,000


    The Committee recommends $576,000,000 for Ukraine, the 
Southern Caucasus states, Russia, and the Central Asian 
republics of the former Soviet Union. This is the same as the 
request and $179,060,000 less than the enacted fiscal year 2003 
level.
    The Committee has included in subsection (a) prior year 
language providing the funds under this heading 
``notwithstanding any other provision of law'' and applying the 
provisions of section 498B(j) of the Foreign Assistance Act. A 
general provision (section 517) also includes long-standing 
language on human rights, and non-use of funds for enhancing 
military capacities, and providing all funds subject to 
separate notification. The recommendation also includes 
language regarding funding levels for Armenia and Russia.

                       CHILD SURVIVAL AND HEALTH

    The Committee continues to be concerned about adverse 
maternal and environmental health conditions and the increasing 
incidence of TB/HIV/AIDS in Russia, Ukraine, and the Central 
Asian Republics. The positive results achieved with the small 
amounts already spent for such programs in recent years have 
been dramatic. The health and child survival sector can 
effectively absorb increased resources, with an immediate and 
personal impact on the stressed citizens of these nations. In 
order to demonstrate its support for these high priority 
activities that directly affect the citizens of these 
countries, the Committee has included bill language allocating 
not less than $63,000,000 for health and child survival 
activities.
    The Committee is aware of and commends the Birth Defects 
Monitoring Program recently instituted in Ukraine to detect the 
incidence of birth defects related to the Chernobyl accident. 
The Committee also commends USAID for its efforts to prevent 
the trafficking of young women from the region and expects 
successful programs to be expanded. The Primary Health Care 
Initiative of the World Council of Hellenes, has come to the 
attention of the Committee. This project merits consideration, 
based on its success, for at least $2,500,000 in 2004.

          INTERNATIONAL AND COMMUNITY PARTNERSHIPS IN EURASIA

    The Committee recognizes that the effectiveness of efforts 
to promote good government and democracy are dependent on 
continuing USAID support for independent programs that pair 
United States cities with cities in the countries of the former 
Soviet Union.
    In Ukraine the United States-Ukraine Foundation and the 
Center for Economic Initiatives provide professional-level 
training and foster economic development at the local level. 
The Committee again urges USAID to continue its direct support 
for these valuable programs, without requiring them to dilute 
their unique community-linkages that have been built over 
several years.
    The Committee also supports the goals of the Ohio-Kharkiv 
Initiative, and commends the Department of State, the State of 
Ohio, and the Kharkiv Oblast (Ukraine) for working with the 
Great Lakes Consortium as the primary facilitator.
    An example is the Arizona-Kazakhstan Partnership 
Foundation, which began as a Tucson-Almaty sister city 
relationship in 1989 and now includes as many as five sub-
partnerships, ranging from the Tucson Chamber of Commerce to 
the League of Women Voters and United Way. Identified by USAID 
as one of its key partnerships, the Committee supports the 
Agency's consideration of future applications for assistance 
under competitive procedures when or should resources become 
available.
    The Committee encourages the Office of the State Department 
Coordinator for Eastern Europe and Former Soviet Union to 
recognize the importance of organizations such as Sister Cities 
International (SCI).

                              RUSSIA-IRAN

    The Committee again recommends language dealing with 
Russian nuclear and ballistic missile cooperation with Iran. 
The language is identical with that contained in existing law. 
The Committee remains disturbed by reports which indicate that 
Russian entities are extensively engaged with Iran in 
cooperative projects that significantly enhance Iran's 
ballistic missile capabilities. The ballistic missile 
cooperation, combined with Russian nuclear cooperation with 
Iran, represent a significant step in Iran's efforts to obtain 
a comprehensive, highly sophisticated weapons of mass 
destruction capability. The Committee reiterates the language 
from the fiscal year 2000 Statement of the Managers ``that 
assistance to combat infectious diseases, child survival and 
non-proliferation activities, support for regional and 
municipal governments, and partnerships between United States 
hospitals, universities, judicial training institutions and 
environmental organizations and counterparts in Russia should 
not be affected by this section.''

            AGRICULTURE AND CONFISCATED PROPERTY IN UKRAINE

    The Committee encourages USAID in Ukraine to coordinate its 
agriculture sector activities with the Department of 
Agriculture to promote modern agricultural methods through 
exchanges and other appropriate means. The Committee also 
recommends that all efforts be made to cooperate with public 
and private efforts to return confiscated religious property.

               SOUTHERN CAUCASUS REGION: NAGORNO-KARABAKH

    The Committee continues to be concerned about the plight of 
the victims of the Nagorno-Karabakh conflict, and expects that 
the remainder of the $20,000,000 in humanitarian assistance, 
initially provided in the fiscal year 1998 Act, will be 
promptly disbursed. In the event that these funds are obligated 
and expended before the end of fiscal year 2004, up to 
$5,000,000 should be made available to address ongoing 
humanitarian needs in Nagorno-Karabakh.

       SUPPORT OF PEACEFUL RESOLUTION OF SOUTH CAUCASUS CONFLICTS

    The Committee reiterates themes included in its previous 
reports:
    The extent and timing of United States and multilateral 
assistance, other than humanitarian assistance, to the 
government of any country in the Caucasus region should be 
proportional to its willingness to cooperate with the Minsk 
Group and other efforts to resolve regional conflicts.
    In furtherance of a peaceful resolution to the Nagorno-
Karabagh conflict, and in support of the confidence building 
measures discussed at NATO and OSCE summits, the Committee 
strongly supports confidence-building measures among the 
parties to the conflict. Such measures include strengthening 
compliance with the cease-fire, studying post-conflict regional 
development such as landmine removal, water management, 
transportation routes and infrastructure, establishing a youth 
exchange program and other collaborative and humanitarian 
initiatives to foster greater understanding among the parties 
and reduce hostilities.
    The Committee has included renewed authority for the 
President to provide humanitarian assistance to the region, 
notwithstanding the restrictions of section 907 of the FREEDOM 
Support Act. The bill language is unchanged from last year. 
This exemption allows for direct assistance by American NGOs to 
refugees and displaced persons throughout the region, including 
those in Nagorno-Karabagh. The Committee understands that 
humanitarian assistance may include a broad range of activities 
and partnerships with United States hospitals and universities 
in maternal and children's health, eldercare, basic education 
and environmental health.

                   ARMENIA AND THE RUSSIAN FEDERATION

    The Committee recommends that $70,000,000 be made available 
from funding sources in this title for Armenia. This is 
$20,500,000 above the request. The Committee is aware of 
proposals to establish and develop in Armenia a central 
diagnostic laboratory for the Caucasus region to address health 
and food safety, and recommends that this proposal, including 
partnerships and cost sharing with United States institutions 
with experience in the early detection of indigenous and trans-
boundary zoometric diseases, be given priority by USAID.
    The Committee also recommends that $90,000,000 be made 
available for the Russian Federation, almost entirely for non-
governmental activities because of the limitations imposed 
under the Iran-Russia provision. The Committee concludes that 
bill language regarding funding levels for programs in Russia 
is necessary in order for important civic society and health 
programs to be completed prior to the anticipated `graduation' 
of Russia from the United States assistance program. In 
particular, the Committee is concerned that adequate funds 
remain available for the National Endowment for Democracy (in 
Ukraine, also), US-Russia Enterprise Fund, the international 
Republican and Democratic institutes, the Eurasia Foundation, 
and health partnerships.

                       EXPANDED THREAT REDUCTION

    The Committee includes $15,000,000 for the bilateral United 
States Civilian Research and Development Foundation (CRDF) in 
this account.

                  UNITED STATES RUSSIA INVESTMENT FUND

    The Committee urges the Coordinator of Assistance to Europe 
and Eurasia to work with USAID and the Overseas Private 
Investment Corporation to assist the Fund to become adequately 
capitalized as soon as feasible.

                              CENTRAL ASIA

    Although the Committee remains concerned about the 
difficult economic and human rights situation for many of the 
citizens of Central Asia, it has not renewed specific language 
on the region. A number of effective non-governmental 
organizations work with the United States Government in its 
efforts to improve the quality of life of Central Asians, and, 
in the health, education, and water sector, especially, NGOs 
such as the Central Asia Institute, CARE, and World Vision have 
brought credit to the United States and merit support from the 
Department of State and USAID. The Committee also urges the 
Coordinator for Europe and Eurasia and USAID to make available 
$1,250,000 for the Cooperative Development Research Program/
Central Asian Republic Initiative in order to continue research 
projects involving scientists from Central Asian Republics and 
Israel.

                          Independent Agencies


                       Inter-American Foundation





Fiscal year 2003 level................................       $16,095,000
Fiscal year 2004 request..............................        15,185,000
Committee recommendation..............................        15,185,000


    The Committee recommends $15,185,000 for the Inter-American 
Foundation, the same as the request and $910,000 below the 
fiscal year 2003 level.

                     African Development Foundation





Fiscal year 2003 level................................       $18,568,000
Fiscal year 2004 request..............................        17,689,000
Committee recommendation..............................        17,689,000


    The Committee recommends funding for the African 
Development Foundation at a level of $17,689,000. This is 
$879,000 below the fiscal year 2003 level and the same as the 
request.

                              Peace Corps





Fiscal year 2003 level................................      $295,069,000
Fiscal year 2004 request..............................       359,000,000
Committee recommendation..............................       314,000,000


    The Committee recommends $314,000,000 for the Peace Corps, 
an amount that is $45,000,000 below the budget request and 
$18,931,000 above the amount enacted for fiscal year 2003. The 
recommendation is not intended to show a lack of support for 
the Peace Corps but is due to the low budget allocation. Prior 
year language addressing purchase of motor vehicles, abortion, 
and availability of funds has been continued in this Act. The 
Committee strongly supports the work of the Peace Corps and of 
its volunteers who currently work in 70 countries. Safety and 
security of volunteers must remain the first priority of the 
agency.
    The Committee includes again in fiscal year 2004 a 
provision that allows the Director of the Peace Corps to make 
appointments to permit Peace Corps employees to serve in excess 
of five years in the case of individuals whose appointment 
involves the safety of Peace Corps volunteers.
    The Committee believes that if safety and security are the 
top priorities of the Administration, then the personnel 
regulations should reflect that commitment and not be limited 
by the five-year rule. Establishing appropriate law enforcement 
networks in each country takes time and frequent visits by 
dedicated, creditable professionals who have both Peace Corps 
and law enforcement experience, similar to Regional Security 
Officers at overseas embassies. According to the July 25, 2002 
GAO report on Peace Corps Safety and Security, implementation 
of the Peace Corps' new security framework is being implemented 
unevenly, partly as a result of staff turnover because of the 
five-year rule. Consistency is needed to provide a safe and 
secure environment. The Committee expects the waiver to apply 
to overseas and headquarters employees of the new Office of 
Safety and Security.
    The Committee urges the Director of the Peace Corps to 
submit individual Country Security reports to accompany the 
annual report that outlines the security environment in all 
countries in which Peace Corps volunteers currently work.

                    Millennium Challenge Corporation





Fiscal year 2003 level................................  ................
Fiscal year 2004 request..............................    $1,300,000,000
Committee recommendation..............................       800,000,000


    The Committee recommends $800,000,000 for the Millennium 
Challenge Account, an amount that is $500,000,000 below the 
request. The reduction solely reflects the constrained 
budgetary situation, the expected delay in enacting 
authorization legislation, nominating and confirming a Chief 
Executive Officer and Board of Directors, and establishing 
criteria and implementing mechanisms for a dramatic new 
approach to foreign assistance.
    The Committee has held two hearings on the proposed 
Millennium Account. The authorizing legislation is expected to 
come before the House shortly. The appropriation is contingent 
upon the enactment of authorization legislation, and at a 
subsequent stage in the appropriations process, the Committee 
expects to address issues of Congressional oversight, 
geographical balance among beneficiaries, and other issues of 
concern. The Committee has recommended a general provision, 
section 575, that defines the role of USAID and its 
relationship with the Millennium Challenge Corporation.

                          Department of State


          International Narcotics Control and Law Enforcement





Fiscal year 2003 level................................      $195,720,000
Emergency supplemental funding........................        25,000,000
Fiscal year 2004 request..............................       284,550,000
Committee recommendation..............................       241,700,000


    The Committee recommends $241,700,000 for ``International 
Narcotics Control and Law Enforcement''. This is $42,850,000 
less than the budget request and $45,980,000 above the fiscal 
year 2003 level, excluding the emergency supplemental 
appropriations act. A limitation of $24,062,000 is recommended 
for administrative expenses.
    The President's request for fiscal year 2004 includes 
significant increases for Mexico, Pakistan, and Afghanistan. 
Because of budgetary pressures in 2004, the subcommittee is 
unable to fully fund the President's requested increase. Of the 
$45,780,000 increase the Committee has provided, the Committee 
supports full funding for Mexico, given the direct impact 
narcotics eradication and drug interdiction in Mexico has on 
the United States.

                        NARCOTICS AND TERRORISM

    Organized crime and terrorist groups throughout the world 
have long used narcotics as a means to generate revenues to 
support armed conflict and the means to spread turmoil. The 
Committee continues to support a strong United States 
counternarcotics assistance program in order to protect United 
States communities from the ravages of drugs, but increasingly 
to deny drug profits that are often used to finance terrorist 
activities.

                              AFGHANISTAN

    The Committee notes that $80,000,000 was provided in the 
fiscal year 2002 emergency supplemental for anti-narcotics and 
law enforcement activities in Afghanistan. Yet, the United 
Nations reports that Afghan farmers are replanting poppy at 
greater rates and in more remote areas of Afghanistan, and the 
rise in opium production in Afghanistan since 2001 is 
substantial. The British-led program of providing individual 
compensation to farmers for not planting heroin has resulted in 
predictable, perverse incentives and little means for 
verification. Therefore, the Committee directs the Secretary of 
State to consult with the Committee before participating in any 
similar individual farmer compensation program again in 
Afghanistan.
    Over 90 percent of the exported opium from Afghanistan is 
exported to Europe. Given the British commitment to funding 
this program, and given the Committee's low budget allocation, 
the Committee is unable to support the President's request for 
Afghanistan.
    Again this year, the Committee recognizes that rural 
economic development in Afghanistan is the only long-term 
solution for the elimination of poppy.

                            DEMAND REDUCTION

    The Committee includes a provision that up to $10,000,000 
of the funds under this heading should be made available for 
demand reduction programs. As escalating drug use and abuse 
continue to take a devastating toll on the health, welfare, 
security, and economic stability of all nations, the importance 
of drug demand reduction has grown. The Committee expects that 
these funds could be used to contribute to the preservation of 
the stability of societies threatened by increasing drug abuse 
and minimizing the impact of international crime.

                                  CUBA

    The Committee has again included a general provision, 
section 571, prohibiting counternarcotics assistance to the 
Government of Cuba. Full reporting and transparency by the 
Cuban Government and United States monitoring of the use of 
counternarcotics assistance in Cuba would be difficult if not 
impossible, according to the State Department, given Cuban 
general hostility toward the United States Government. 
Additionally, provision of assistance to the maritime drug 
interdiction force (the TGF) would, according to both Amnesty 
International and the State Department's Country Reports on 
Human Rights Practices, violate section 553 of this act, the 
so-called Leahy amendment.

                              Buy American

    The Committee is concerned about the State Department and 
USAID using waivers to purchase vehicles made by non-United 
States manufacturers. Current law requires the Administration 
to purchase only United States- made vehicles, except in very 
rare circumstances. The use of United States taxpayer dollars 
to purchase foreign vehicles is a matter that must receive a 
high level of scrutiny. The Committee is concerned that 
sufficient scrutiny has not been applied in past decisions to 
purchase foreign-made vehicles.
    The Administration's waiver authority has not been amended 
in this bill because of assurances received from the State 
Department and USAID regarding future purchases. The Committee 
commends the Deputy Secretary for directing the State 
Department to purchase United States-made vehicles for use in 
Iraq in the future. The Committee directs the USAID, the 
Department of State and the Department of Defense to consult 
with the Committee before any future waivers to purchase 
foreign-made vehicles are granted.

                     Andean Counterdrug Initiative





Fiscal year 2003 level................................      $695,450,000
Emergency supplemental funding........................        34,000,000
Fiscal year 2004 request..............................       731,000,000
Committee recommendation..............................       731,000,000


    The Committee recommends $731,000,000 for the Andean 
Counterdrug Initiative, an amount equal to the request and 
$1,550,000 above the 2003 level, including emergency 
supplemental appropriations. The Andean Counterdrug Initiative 
is the continuation of the Administration's multi-year 
counterdrug assistance efforts designed to sustain and expand 
programs initially funded by Plan Colombia in the fiscal year 
2000 emergency supplemental appropriations act. A limitation of 
$15,680,000 is recommended for administrative expenses for the 
Department of State and $4,500,000 for USAID. The Committee 
notes the requirement in the bill that the Secretary of State, 
in consultation with the Administrator of USAID, shall provide 
to the Committees on Appropriations not later than 45 days 
after the date of the enactment of this Act and prior to the 
initial obligation of funds appropriated under this heading, a 
report on the proposed uses of all funds under this heading on 
a country-by-country basis for each proposed program, project, 
or activity.
    The caps on the numbers of United States personnel in 
Colombia remain in effect. The Committee requests that the 
Secretary of State submit to the Appropriations Committees a 
semi-annual report with respect to the Andean Counterdrug 
Initiative. Each report shall include an accounting of all 
aircraft, vehicles, boats and lethal equipment (other than 
ammunition) transferred to the militaries or police of any 
nation with funds made available under this heading. 
Additionally, the Committee requires that the personnel cap and 
Plan Colombia reports as required in the fiscal year 2000 
emergency supplemental also be submitted to the Committees on 
Appropriations.
    The Committee recommends $1,000,000 for the Naval Post 
Graduate School (NPS) from new and prior year funds for 
programs to strengthen public engagement and democratic control 
of national security in Colombia.

                                COLOMBIA

    The Committee notes that the people of Colombia have shown 
a long-term resilience and tolerance for difficult and violent 
conditions, and the Committee supports the President of 
Colombia and the Colombian government's efforts to collect the 
additional resources needed to invest in the military, police, 
and social programs to restore order and to give Colombians 
better access to services.
    The Committee notes the progress in coca eradication that 
Plan Colombia has been able to achieve since the inauguration 
of the current President of Colombia. According to official 
United States statistics, coca cultivation dropped for the 
first time in 2002 from a level of 169,800 hectares in 2001 to 
144,450 hectares in 2002.
    Plan Colombia was proposed and implemented as a 5-year 
program, and its objectives were to be met by the end of 2005. 
Therefore, the direction of United States policy with respect 
to Colombia and the Andean nations is at a crossroads.
    The Committee makes the following recommendations as the 
inter-agency process begins to re-prioritize and re-orient 
assistance for Colombia: (1) the Committee still concludes that 
coca provides the revenue and motive behind the violence 
committed by both the guerrilla and paramilitary groups, 
therefore, the Committee expects counternarcotics, alternative 
development, interdiction and human rights improvements to 
remain part of United States policy in Colombia; (2) more 
heroin in the United States is trafficked from Colombia, 
therefore coca can no longer remain the sole priority for 
eradication efforts in Colombia; (3) public security and law 
enforcement should become an increasing focus of United States 
assistance and could be vital to eradicating poppy in remote 
areas; (4) the Colombian government should assume 
responsibility for maintaining more of Plan Colombia's assets; 
and (5) eliminating the financial sources of the guerillas and 
paramilitaries, and decreasing their military capabilities by 
targeting their leadership, can lead to higher desertion rates 
and bring these groups closer to peace negotiations.
    The Committee directs that not later than 60 days after 
enactment of this Act the State Department shall provide to the 
Committees on Appropriations a report that describes detailed 
plans and programs by the Departments of State and Defense to 
train Colombian nationals for the purpose of assuming 
responsibilities for programs funded in this Act currently 
being executed by United States contractors. The report shall 
outline the program activities, estimates of funding levels, 
location of training, and expected length of length of time in 
which the training of Colombian nationals will be completed.
    The Committee commends the Department of State and USAID 
for its efforts to keep the Committee informed of program 
developments in Colombia in fiscal year 2003.

                       AVAILABILITY OF ASSISTANCE

    The Committee again has extended the availability of funds 
provided for assistance for Colombia to support a unified 
campaign against narcotics trafficking, against activities by 
organizations designated as terrorist organizations, and to 
take actions to protect health and human welfare. The Committee 
is supportive of the Colombian government in its attempts to 
provide security for the Colombian people and has provided the 
expansion of authorities in recognition that the narcotics 
industry is invariably linked to the terrorist groups, 
including the paramilitary organizations, in Colombia. As in 
prior years, the expanded authority is not a signal from the 
Committee for the United States to become more deeply involved 
in assisting the Colombian Armed Forces in fighting the 
terrorist groups, especially not at the expense of the 
counternarcotics programs, but to provide the means for more 
effective intelligence gathering and fusion, and to provide the 
flexibility to the Department of State when the distinction 
between counternarcotics and counterterrorism are not clear 
cut. The Committee notes the useful information included in the 
May 2003 report to Congress on the use of United States assets 
in Colombia. The Committee expects to be consulted if the 
current policy of implementing the expanded authorities changes 
from that described in the May 2003 report.

                      INTERNALLY DISPLACED PERSONS

    The Committee expects the Department of State to allocate 
the full amount requested for internally displaced persons, a 
level of $38,000,000 to be provided to USAID and $5,000,000 to 
be provided to the Department of State's Bureau for Population, 
Refugees, and Migration (PRM).

                              HUMAN RIGHTS

    The Committee calls on the Department of State to ensure 
that all United States laws regarding human rights, including 
section 553 of this Act, are strictly applied in Colombia and 
each of the Andean nations. The Committee includes again a 
general provision requiring that the Secretary of State certify 
that certain human rights conditions have been met before 25 
percent of funds may be made available for assistance for the 
Colombian Armed Forces. Again this year, the Committee 
recommends a one-time annual certification process in fiscal 
year 2004.

            ALTERNATIVE DEVELOPMENT AND SECURITY IN COLOMBIA

    The Committee strongly supports USAID's continuing 
alternative development strategy that started at the beginning 
of 2002 and focuses on the historic underdevelopment of 
Colombia's outlying regions. The programs concentrate on local 
infrastructure needs (roads, electricity, water) and delivery 
of services at the community level. This focus on the entire 
community increases the social pressure for eradication and 
also helps organize the community to identify and prioritize 
local needs. In the first three months of 2003, the Committee 
understands that almost 1,200 hectares have been manually and 
voluntarily eradicated in Putamayo. The Committee hopes USAID 
partners can continue building on their good working 
relationships with mayors and local leaders.
    Additionally, the Committee recognizes that without public 
security and law enforcement, no level of alternative 
development funding by this Committee or the Colombian 
government can result in development that is sustainable. 
Additionally, the Committee is aware of the security threats 
facing program implementers on a daily basis.
    The Committee supports the so-called ``carabinieros'' 
police program for establishing law enforcement in rural and 
remote areas and encourages continuing United States assistance 
for the program.

                       AFRO-COLOMBIAN COMMUNITIES

    The Pacific Coast of Colombia has been devastated by the 
intensification of the continuing civil conflict, expansion of 
coca crop production, and aerial fumigation. This is an area 
rich in bio-diversity and where many Afro-Colombians live and 
collectively own land. The Committee remains concerned that 
sufficient alternative development programs are not in place to 
address the substantial needs of the Afro-Colombian and 
indigenous populations or to preserve the region's bio-
diversity. In addition to current programs, the Committee asks 
USAID to focus its development efforts on implementing 
education, health, environmental, and economic development 
programs, particularly economic plans that are inclusive of 
Afro-Colombian communities and preserve the governmental 
organizations, and local municipal leaders in the 
implementation of assistance programs. The Committee also asks 
the Department of State to include the progress of USAID funded 
programs aimed at helping Afro-Colombian communities in the 
report to the Committees on Appropriations as required by 
section 694(a) of Public Law 107-228.

                            COLOMBIAN HEROIN

    The Committee is concerned about the eradication levels of 
opium in Colombia. An increase in Colombian heroin has led to a 
serious and spreading problem of heroin use and overdose deaths 
in the United States. The Committee is concerned about the 
needs of the Colombian National Police (CNP) to accomplish this 
eradication mission. The State Department shall consult with 
the Committee regarding its strategy for heroin eradication and 
the changing requirements of its fiscal year 2004 request prior 
to funds being notified to the Committees on Appropriations as 
required by this Act.

                                  PERU

    Peru is the second largest recipient of counternarcotics 
and alternative development assistance from the United States, 
and while the Committee is aware that the political environment 
in Peru has direct consequences for eradicating coca, the 
Committee was surprised to learn that in April 2003 the 
Peruvian government signed a supreme decree ceasing most forced 
eradication of coca. The Committee understands that the 
Department of State and USAID have given temporary support to 
``autoeradication''--a pilot policy of voluntary eradication 
combined with the use of community development projects as an 
incentive for cooperation. The Committee requests that the 
Department of State and USAID consult with the Committee 
regarding the level of cash grants used as part of alternative 
development in Peru. Additionally, the Committee requests that 
USAID and the Department of State keep the Committee informed 
as developments and changes in United States eradication and 
alternative development programs occur during the fiscal year.

                                BOLIVIA

    While the Committee takes special note of the progress that 
Bolivia made in the war against drugs under the Bolivian 
Government's Dignity Plan, this progress could be erased 
quickly if the commitment by either the Bolivian government or 
the United States were to falter. The Committee is aware that 
Bolivia is a candidate to be a recipient of the Millennium 
Challenge Account funding. Therefore, the Committee encourages 
the Millennium Challenge Corporation to take into account the 
link between good governance and this matter when it considers 
eligibility criteria.

                         EUROPEAN CONTRIBUTIONS

    The Committee notes that demand for Colombian coca is 
rising in Europe and approaching United States consumption 
levels of approximately 300 tons a year. European nations and 
the European Union have contributed very little to eradication 
of coca or development programs in Colombia. The Committee 
again urges the Secretary of State to negotiate with our 
European allies in order to persuade them to contribute 
additional funds to counter-narcotics efforts, alternative 
development, and judicial reform in the Andean region.

                    Migration and Refugee Assistance





Fiscal year 2003 level................................      $781,885,000
Fiscal year 2004 request..............................       760,197,000
Committee recommendation..............................       760,197,000


    The Committee recommends $760,197,000 for Migration and 
Refugee Assistance, an amount that is equivalent to the request 
and $21,688,000 less than the amount enacted for fiscal year 
2003. A limitation of $18,500,000 is recommended for 
administrative expenses.

                          REFUGEE RESETTLEMENT

    The Committee notes that the President authorized up to 
70,000 refugees to be admitted to the United States for fiscal 
year 2003. To date, fewer than 20,000 have been actually 
admitted. The Committee is concerned that the discrepancy 
between authorized and actual number of refugees admitted gives 
the impression that the United States is abandoning 
humanitarian commitments and leadership in protecting the 
world's most vulnerable people. Given the terrorist attacks on 
the United States, the Committee understands the need for the 
increased security procedures now applied to the resettlement 
process. While there has been an increase in the cost per 
refugee for admission, the Committee notes a significant 
carryover of funds because of security-related delays. 
Therefore, the Committee expects the Department of State to 
fully consult with the Committee as it decides the disposition 
of the 2003 carryover funds.

                            TIBETAN REFUGEES

    The Committee supports continued funding to assist Tibetan 
refugees and directs $2,000,000 for this purpose. The Committee 
is concerned about the inadequate protection for Tibetan 
refugees transiting through Nepal en route to resettlement in 
India. Current prosecutions are a breach of the long-standing 
agreement that the Nepalese authorities would turn Tibetans 
over to UNHCR for processing as ``persons of concern.'' Given 
the increased size of the President's request for assistance to 
Nepal, the Committee directs the Department of State to provide 
a report prior to the notification to the Committee of any 
assistance to Nepal in fiscal year 2004 concerning Nepal's 
cooperation with UNHCR in processing Tibetan refugees.

                         RESETTLEMENT IN ISRAEL

    The Committee supports $50,000,000 for humanitarian 
migrants from the former Soviet Union and other countries of 
distress resettling in Israel. Since 1989, Israel has accepted 
more than one million refugees. The Committee remains strongly 
committed to assisting the resettlement of Russian, Eastern 
European, Ethiopian and other humanitarian migrants in Israel. 
The funds provided in this bill assist in the transportation 
and initial absorption costs for more than 100,000 migrants per 
year. The Committee notes there has been a decline in the 
numbers arriving from the former Soviet Union in the last year. 
However, the decline in costs associated with this decrease 
will be more than offset by a significant increase in the costs 
of providing transportation and resettlement of a larger number 
of refugees from Ethiopia.

                        MAGEN DAVID ADOM SOCIETY

    The Committee is disappointed again this year that the 
International Committee of the Red Cross (ICRC) has not taken 
action to admit the Magen David Adom Society of Israel to the 
International Red Cross and Red Crescent Movement. The American 
Red Cross has promoted the membership of the Society in the 
Movement, but little positive action has been forthcoming. As a 
result, the American Red Cross has withheld its headquarters 
contribution to the ICRC for the past few years. Therefore the 
Committee is recommending a continuation of bill language that 
would also withhold the annual headquarters contribution made 
by the Department of State unless the Magen David Adom Society 
is given the opportunity to participate in the activities of 
the International Red Cross and Red Crescent Movement. This 
limitation will not, and is not intended to, restrict funding 
for humanitarian assistance programs that may be programmed 
through the ICRC using other funds provided in this account. It 
is only intended to affect the funding the United States 
provides on an annual basis to the ICRC bureaucracy in Geneva.

                           REFUGEE PROTECTION

    Not later than 120 days after the date of enactment of this 
Act, the Secretary is requested to submit to the Committees on 
Appropriations and report outlining a federal agency protection 
strategy, including: an analysis based on the past decade's 
experience of the specific protection needs of women and 
children at the various stages of a complex humanitarian 
emergency; a listing of the needs of and threats to these 
populations in emergency situations; a description of which 
agencies and offices of the United States Government are 
responsible for addressing each aspect of such needs and 
threats; and recommendations for improving United States and 
international systems for the protection of women and children 
during complex humanitarian emergencies.

     United States Emergency Refugee and Migration Assistance Fund





Fiscal year 2003 level................................       $25,831,000
Emergency supplemental funding........................        80,000,000
Fiscal year 2004 request..............................        40,000,000
Committee recommendation..............................        15,831,000


    The Committee recommends $15,831,000 for the Emergency 
Refugee and Migration Assistance (ERMA) Fund, which is 
$10,000,000 less than the 2003 enacted level, excluding 
emergency supplemental funding and $24,169,000 below the 
request.
    The Committee notes that $80,000,000 was provided in the 
Emergency Wartime Supplemental Appropriations for fiscal year 
2003 for ERMA, $40,000,000 more than the amount requested by 
the President. None of these funds have been drawndown due to 
the successful prevention of a refugee crisis in Iraq.

    Nonproliferation, Anti-Terrorism, Demining and Related Programs





Fiscal year 2003 level................................      $304,408,000
Emergency supplemental appropriations.................        28,000,000
Fiscal year 2004 request..............................       385,200,000
Committee recommendation..............................       335,200,000


    The Committee recommends a total appropriation of 
$335,200,000 for ``Nonproliferation, Anti-terrorism, Demining 
and Related Programs'', an amount that is $50,000,000 below the 
request and $30,792,000 above the fiscal year 2003 enacted 
level, excluding emergency supplemental appropriations.
    The following table compares fiscal year 2003 funding for 
the programs covered by this account, as well as the 
President's request for fiscal year 2004 and the Committee 
recommendation:

   Non-Proliferation, Anti-Terrorism, Demining, And Related Programs


----------------------------------------------------------------------------------------------------------------
                                                                                                    Fiscal Year
                                                                    Fiscal Year     Fiscal Year   2004 Committee
                                                                   2003 enacted    2004 request   recommendation
----------------------------------------------------------------------------------------------------------------
Nonproliferation Programs:
    Nonproliferation and Disarmament Fund.......................      14,902,000      35,000,000      20,000,000
    Export Control & Border Security............................      36,000,000      40,000,000      36,000,000
    Science Centers.............................................      52,000,000      59,000,000      52,000,000
    IAEA Voluntary Contribution.................................      52,900,000      50,000,000      52,900,000
    International Monitoring System.............................      14,000,000      19,300,000      17,000,000
    Korean Peninsula Energy Development Organization............       4,968,000  ..............  ..............
                                                                 -----------------------------------------------
    Subtotal Nonproliferation:..................................     174,770,000     203,300,000     177,900,000
Anti-Terrorism Programs:
    Anti-terrorism Assistance...................................      65,638,000     106,400,000      90,300,000
    Terrorist Interdiction Program..............................       5,000,000      11,000,000       5,000,000
    CT Engagement/Workshops.....................................  ..............       2,500,000  ..............
                                                                 -----------------------------------------------
      Subtotal Anti-Terrorism...................................      70,638,000     119,900,000      95,300,000
Regional Stability and Humanitarian Assistance:
    Humanitarian Demining.......................................      46,000,000      50,000,000      50,000,000
    International Trust Fund....................................      10,000,000      10,000,000      10,000,000
    Small Arms/Light Weapons Destruction........................       3,000,000       2,000,000       2,000,000
                                                                 -----------------------------------------------
      Subtotal Regional Stability/Humanitarian Assistance:......      59,000,000      62,000,000      62,000,000
      Total:....................................................  304,408,000 \1     385,200,000    335,200,000
                                                                               \
----------------------------------------------------------------------------------------------------------------
\1\ In addition, $28,000,000 in emergency wartime appropriations was provided for Afghanistan.

                       ANTI-TERRORISM ASSISTANCE

    The Committee recommends $90,300,000 for Anti-Terrorism 
Assistance, an increase of $24,662,000. This program, run by 
the State Department's Diplomatic Security officials under the 
policy direction of the Coordinator for Counterterrorism, 
provides training and skills, technical assistance, and 
equipment to improve professionalism and capability in the War 
on Terrorism. To date, the Anti-Terrorism Assistance Program 
has trained and assisted over 31,000 foreign security and law 
enforcement personnel from over 127 countries. Training is in 
areas such as crisis management, cyber terrorism, dignitary 
protection and kidnap intervention, border control, airport 
security, bomb detection, investigating terrorist financing, 
and response to incidents involving weapons of mass 
destruction.
    Of the recommended increase in fiscal year 2004, $5,000,000 
is to be used to assist East African nations to combat 
terrorist threats. The Committee recommendation supports 
equipment ($5,300,000) and Mobile Emergency Training Teams 
($10,000,000). The recommendation does not support proposed 
increases in program administration costs ($8,600,000).

                        SCIENCE CENTER PROGRAMS

    The Committee recommendation provides $52,000,000 for State 
Department Science/Research centers in Russia and Ukraine. The 
recommended level is the same as fiscal year 2003 and 
$7,000,000 less than the fiscal year 2004 budget request.
    The Committee recognizes the outstanding achievements of 
the Science Center program. However, the Committee believes it 
is time to reduce expenditures in the former Soviet Union and 
to address similar dual use/conversion issues in other areas of 
the world. Accordingly, $5,000,000 of the recommended funding 
level is reserved to work with Iraqi weapons scientists and 
engineers and to channel their expertise into peaceful research 
and tasks needed to rebuild their nation.

                       KEDO UNOBLIGATED BALANCES

    The Committee recommends no funding for the Korean 
Peninsula Energy Development Organization or KEDO. Clearly, 
North Korea is not in compliance with the agreed framework. The 
Committee recommends that the Administration reprogram 
$4,968,000 in unobligated fiscal year 2003 funds for use 
instead by the International Atomic Energy Agency (IAEA). For 
example, these funds could be better put to use supporting IAEA 
technical assistance and equipment to improve safeguards and to 
improve verification activities.

                                DEMINING

    The Committee recommends $62,000,000 for regional stability 
and humanitarian assistance programs. The recommendation 
includes $60,000,000 for humanitarian demining, the same as the 
budget request, of which $10,000,000 is for the Slovenian 
International Trust Fund. The Committee directs that such 
amounts may be deposited into that fund only to the extent 
matching amounts are deposited by other governments, entities, 
or persons. In addition, these funds should only be expended by 
the fund in consultation with the United States Government. The 
Committee further directs that deposits into the fund shall be 
subject to the regular notification procedures of the 
Committees on Appropriations.
    The Committee also recommends $2,000,000 for small arms/
light weapons destruction, the same level as requested in the 
budget. The Committee notes that similar demilitarization 
programs are funded under other appropriation accounts such as 
Assistance to Eastern Europe and the Baltic States.

                       Department of the Treasury


               International Affairs Technical Assistance





Fiscal year 2003 level................................       $10,730,000
Fiscal year 2004 request..............................        14,000,000
Committee recommendation..............................        19,000,000


    The Committee recommends $19,000,000 under this heading for 
international technical assistance by the Department of the 
Treasury, an amount that is $5,000,000 more than the request 
and $8,270,000 above last year's level. In operation since 
1991, Treasury's Office of Technical Assistance provides expert 
fiscal and monetary policy advisors to countries of the former 
Soviet Union and Eastern Europe. Beginning in fiscal year 1999, 
Treasury created the Treasury International Affairs Technical 
Assistance (TIATA) program and expanded the countries to Asia, 
Africa and Latin America. The Committee directs the Office of 
Technical Assistance (OTA) to notify the Committee prior to the 
obligation of funds for the compensation or travel expenses of 
any individual who is not an employee of the Department of 
Treasury.

                          TERRORIST FINANCING

    The Committee recognizes the central role of financing in 
the operation of terrorist organizations such as Al Qaeda and 
commends the Administration for initial actions taken in the 
wake of the terrorist attacks on September 11, 2001 to block 
the flow of money to these organizations. Given the wide range 
of formal and informal financial mechanisms to secure funding 
and to move it around the globe, the Committee acknowledges the 
need for an increasingly forceful approach to solving this 
problem. The Committee acknowledges the key role played by the 
OTA in blocking terrorist financing. Working with host 
countries to combat terror financing, Treasury teams focus on 
areas most commonly exploited by terrorists, such as financial 
institutions, budget policy and management, and financial crime 
enforcement. The Committee has provided an increase of 
$5,000,000 over the request to enable OTA to expand its efforts 
in key areas such as Southeast Asia, the Pacific Rim, and South 
America. The Committee directs the Secretary of Treasury to 
report, not later than 120 days after enactment of this Act, on 
which countries it considers to be major source and/or transit 
points for terror financing, a list of countries with which OTA 
is currently working to combat terror financing, and a list of 
other countries OTA has identified as needing such assistance.

                           Debt Restructuring





Fiscal year 2003 level................................  ................
Fiscal year 2004 request..............................      $395,000,000
Committee recommendation..............................        95,000,000


    The Committee recommends $95,000,000 under this heading for 
international debt restructuring by the Department of the 
Treasury, an amount that is $300,000,000 less than the request 
and $95,000,000 above last year's level.
    The Committee recommends $20,000,000 as requested for the 
Tropical Forest Conservation Act (TFCA) programs and 
$75,000,000 as requested for a contribution to the Heavily 
Indebted Poor Countries (HIPC) Trust Fund. The Committee does 
not provide $300,000,000 requested for bilateral debt relief to 
the Democratic Republic of the Congo (DRC). Funds in this 
account are subject to the regular notification procedures of 
the Committees on Appropriations.

               TROPICAL FOREST CONSERVATION ACT PROGRAMS

    In fiscal year 2003, the Committee provided the funds for 
Tropical Forest Conservation Act (TFCA) programs as requested 
by the President directly to the Agency for International 
Development. This year, as in years prior to 2003, the 
Committee is appropriating TFCA funds directly to the 
Department of Treasury. However, the Committee notes that three 
additional countries have been found eligible for TFCA 
programs, Jamaica, Panama, and Colombia, yet the Committee has 
not been consulted. The Committee notes that section 812 of the 
Foreign Assistance Act requires the President to consult with 
the Committee on a periodic basis to review the eligibility of 
countries for benefits from the Tropical Forest Facility. 
Therefore, the Committee expects the Department of Treasury to 
adhere to requirements of the law and consult with the 
Committee 15 days prior to the Treasury determination that 
additional countries are found eligible for TFCA.

                HEAVILY INDEBTED POOR COUNTRIES PROGRAM

    The Committee provides $75,000,000 for the first payment of 
the new United States Contribution to the HIPC Trust Fund. 
Although the Committee fully funded the United States 
$600,000,000 commitment to the HIPC Trust Fund in the fiscal 
years 2000, 2001 and 2002 appropriations Acts, President Bush 
committed the United States to an additional $150,000,000 for 
the HIPC Trust Fund in 2002. The Committee is concerned that 
the need for additional HIPC Trust Fund contributions is 
partially due to delays in donor nations fulfilling their 
original HIPC pledges. The Committee is more concerned however, 
that although the United States has pledged $150,000,000, there 
appears to be no sunset for the current HIPC program, and 
therefore no certainty that the latest pledge by the United 
States will be the last. The lack of public information about 
the HIPC Trust Fund financing shortfall is further 
disconcerting.
    Therefore, the Committee directs the Department of Treasury 
to provide to the Committee a detailed report within 45 days of 
enactment of this act a list of donors to the HIPC Trust Fund, 
each donor's pledge and actual contribution, the date of 
contributions as well as detailed disbursement data of the Fund 
including the level of funds transferred to each international 
financial institution and the date of the transfer.

                                 CONGO

    Since 1996, HIPC has been justified to the Committee as a 
strategy to place debt relief within an overall framework of 
poverty reduction. The President's request for $300,000,000 for 
the DRC, appears to upend this strategy. The bilateral debt 
that the President's request would forgive is not being 
serviced, therefore debt reduction would in no way improve the 
immediate humanitarian crisis facing the civilian population. 
The Committee assumes that debt relief can only be effective if 
it is accompanied by sustained implementation of poverty 
reduction and economic reform programs, yet the DRC is facing a 
new transitional government under a power-sharing agreement 
with the rebel groups. In a country facing massive humanitarian 
and governance challenges, the Committee does not recommend 
forgiving debt that is not being serviced.

                     TITLE III--MILITARY ASSISTANCE


                  Funds Appropriated to the President


             International Military Education and Training





Fiscal year 2003 level................................       $79,480,000
Fiscal year 2004 request..............................        91,700,000
Committee recommendation..............................        91,700,000


    The Committee recommends $91,700,000 for the International 
Military Education and Training (IMET) program, which 
represents an increase of $12,220,000 above the fiscal year 
2003 level and is the same as the budget request. IMET is part 
of the overall United States security assistance program, and 
through it the United States Government provides training to 
predominantly military students from allied and friendly 
nations. The IMET program exposes students to the United States 
professional military establishment and the American way of 
life, including democratic values and rule of law, respect for 
individual and human rights. In 1990, Congress directed the 
Department of Defense to establish a program within IMET--
called Expanded-IMET or ``E-IMET'' focused on training foreign 
civilian and military officials in three areas: managing and 
administering military establishments and budgets; creating and 
maintaining effective military judicial systems and military 
codes of conduct, and fostering greater respect for the 
principle of civilian control of the military.

                               GUATEMALA

    The Committee includes prior year bill language limiting 
Guatemala to Expanded IMET only, subject to notification.

                           IMET AVAILABILITY

    The Committee again recommends that $3,000,000 of IMET 
appropriations remain available until expended.

                    FOREIGN MILITARY TRAINING REPORT

    The Department of State and Department of Defense have been 
required in past years to submit foreign military training 
reports by both section 656 of the Foreign Assistance Act and a 
separate requirement contained in the annual Foreign 
Operations, Export Financing and Related Programs Act (section 
561 in the fiscal year 2003 Act). The report requirements are 
similar and differ in only a few minor areas such as the date 
they are required for submission to Congress.
    The information in these military training reports is 
extremely valuable and the Committee appreciates the work of 
the professional personnel in the Departments of State and 
Defense. However, to simplify requirements, improve clarity and 
eliminate redundant requirements, the Committee in a general 
provision section 554 clarifies that a single Foreign Military 
Training Report (as required under section 656 of the Foreign 
Assistance Act) is sufficient and this annual report shall be 
submitted to both the House Committee on International 
Relations and Senate Committee on Foreign Relations and the 
Committees on Appropriations of the House and Senate.

                   Foreign Military Financing Program





Fiscal year 2003 level................................    $4,045,532,000
Emergency supplemental funding........................     2,059,100,000
Fiscal year 2004 request..............................     4,414,000,000
Committee recommendation..............................     4,314,000,000


    The Committee recommends $4,314,000,000 in Foreign Military 
Financing assistance. This program provides grants for the 
acquisition of United States defense equipment, services and 
training. The Foreign Military Financing (FMF) program enables 
key allies and friendly nations to improve defensive 
capabilities, and fosters bilateral military relationships with 
the United States and interoperability with United States 
forces. The recommended fiscal year 2004 program level is 
$268,468,000 above the fiscal year 2003 level, excluding 
emergency wartime supplemental appropriations, and $100,000,000 
below the budget request. The increase above the fiscal year 
2003 level is primarily due to an increase of $73,650,000 for 
Israel, as requested by the President.

                                 ISRAEL

    The Committee recommends a total Foreign Military Financing 
(FMF) program of not less than $2,160,000,000 in grants for 
Israel, which shall be available within 30 days of enactment of 
this Act.
    The Committee remains committed to helping Israel maintain 
security. Therefore, the Committee is convinced the United 
States must make every effort to carry out its long-standing 
policy of ensuring that Israel's technological edge is 
maintained. As a result, the Committee has provided an increase 
of $73,650,000 above the fiscal year 2003 level (excluding the 
emergency wartime supplemental), as requested by the President. 
The Committee also believes that a sustained military 
improvement program will be required over the next five years, 
at an annual rate of approximately $60,000,000, to assist 
Israel in responding to these emerging security challenges. 
However, with respect to this recommended increase in military 
assistance, the Committee must be very clear that it cannot 
commit future Congresses to the future appropriation of funds. 
Therefore, future increases in military assistance will require 
the annual review of the Congress and will necessarily be based 
upon an assessment of the security situation at the time.
    The Committee also recommends that, to the extent that the 
Government of Israel requests that FMF grant funds for Israel 
be used for such purposes, and as agreed by Israel and the 
United States, funds may be made available for advanced weapons 
systems of which $568,000,000 shall be available for the 
procurement in Israel of defense articles and defense services, 
including research and development. This represents a 
$18,000,000 increase over the fiscal year 2003 level and 
reflects a recognition by the Committee of Israel's need for 
similar annual increases over the next few years in order to 
provide Israel with increased flexibility in meeting the 
emerging security challenges in the Middle East.

                                 JORDAN

    The Committee strongly supports the Administration's 
efforts to improve Jordanian security and therefore recommends 
full funding of the President's request of $206,000,000 for 
Jordan. Under the leadership of King Abdullah, Jordan plays a 
critical role in supporting peace and security in the Middle 
East. The Committee is well aware that Jordan's security 
requirements are extensive, particularly in the areas of ground 
force modernization and border security.

                                 EGYPT

    The Committee recommends a total of $1,300,000,000 in 
Foreign Military Financing grants for Egypt.
    Pursuant to the President's budget request bill language is 
recommended that would require that funds estimated to be 
outlayed for Egypt during fiscal year 2004 shall be transferred 
to an interest bearing account for Egypt in the Federal Reserve 
Bank of New York within 30 days of enactment of this Act. The 
Committee is convinced that continued military cooperation 
between Egypt and the United States remains in the national 
security interests of both countries.

                              THE BALTICS

    The Committee strongly supports at least the Presidents' 
budget request of $19,500,000 for Estonia, Latvia, and 
Lithuania. Previous years' funding has significantly supported 
the commendable efforts of these countries to attain Western 
military standards and to improve their capacities to 
contribute to international security through the provision of 
peacekeepers to international peacekeeping missions. These 
democratic nations also strongly supported the international 
coalition in Operation Iraqi Freedom.

                         ARMENIA AND AZERBAIJAN

    The Committee supports the President's budget request of 
$2,500,000 for assistance for Armenia and $2,500,000 for 
assistance for Azerbaijan. In addition, the Committee supports 
IMET assistance levels of $900,000 for both countries as 
requested by the President.

                        ADMINISTRATIVE EXPENSES

    The Committee has recommended a limitation on 
administrative expenses of $40,500,000. This level represents 
an increase of $2,500,000 for inflationary costs and 
adjustments to base and is consistent with the budget request 
for the Defense Security Cooperation Agency (DSCA).

                  FOREIGN MILITARY FINANCING SURCHARGE

    The Committee has included a limitation on Foreign Military 
Financing operating costs of $361,000,000. This limitation may 
be waived pursuant to the regular notification procedures of 
the Committees on Appropriations. This is $5,000,000 more than 
the fiscal year 2003 level and the same as the request.

                          FMF EXPENDITURE RATE

    The Committee continues prior year language that requires 
that Foreign Military Financing funds be expended at the 
minimum rate necessary to make timely payments for defense 
articles and services. In addition, it continues language 
providing that such funds shall be obligated upon apportionment 
in order to allow for the orderly execution of program funds.

                         PROCUREMENT AGREEMENTS

    The Committee has continued prior year language requiring 
recipients of Foreign Military Financing grants to sign 
agreements with the United States prior to using FMF funds to 
finance the procurement of any item not sold by the United 
States under the Arms Export Control Act.

                              PROHIBITIONS

    The Committee has included bill language prohibiting 
military assistance to Indonesia, Guatemala, Sudan and Liberia. 
The Administration did not request FMF appropriations for these 
nations in fiscal year 2004.
    The Committee continues to support United States assistance 
to Guatemala to implement the Guatemalan peace accords. 
However, it remains concerned about limited progress in certain 
areas such as reform of the Guatemalan military. Therefore the 
Committee retains the existing ban on Foreign Military 
Financing and International Military Education and Training 
(IMET), with the exception of E-IMET. The Committee expects the 
State Department to continue to press the Guatemalan government 
to address corruption, comply with the peace accords, follow 
through on the recommendations of the Historical Clarification 
Commission, and move forward on important unresolved human 
rights cases.

                                 UGANDA

    The Committee recommends that up to $2,000,000 in FMF funds 
be used to assist the Government of Uganda with counter-
terrorism efforts. This assistance would be used to provide 
surveillance capabilities and border security. This 
recommendation assumes continued cooperation with United 
Nations effort to end conflicts in the Democratic Republic of 
the Congo.

                        Peacekeeping Operations





Fiscal year 2003 level................................      $114,252,000
Emergency supplemental funding........................       100,000,000
Fiscal year 2004 request..............................        94,900,000
Committee recommendation..............................        85,000,000


    The Committee recommends $85,000,000 for voluntary 
contributions for international peacekeeping operations. This 
amount is $29,252,000 below the level provided in fiscal year 
2003, excluding emergency wartime supplemental appropriations, 
and is $9,900,000 less than the President's request.
    The Committee notes that to date none of the $100,000,000 
in additional peacekeeping funds provided in the emergency 
wartime supplemental have been obligated.

               TITLE IV--MULTILATERAL ECONOMIC ASSISTANCE


                  International Financial Institutions


                      Global Environment Facility





Fiscal year 2003 level................................      $146,852,533
Fiscal year 2004 request..............................       184,996,904
Committee recommendation..............................       107,500,000


    The Committee recommends $107,500,000 for the Global 
Environment Facility (GEF), administered by the World Bank for 
the entire scheduled United States annual payment to the third 
replenishment of GEF. The recommendation is $77,496,904 below 
the request and $39,352,533 less than the amount enacted for 
2003.

       Contribution to the International Development Association





Fiscal year 2003 level................................      $844,475,000
Fiscal year 2004 request..............................       976,825,167
Committee recommendation..............................       850,000,000


    The Committee is providing $850,000,000 for the United 
States contribution to the International Development 
Association (IDA), $126,825,167 less than the request and a 
$5,525,000 increase above the 2003 enacted level. The 
recommended level is intended for the second of three payments 
under the United States commitment to the thirteenth 
replenishment of IDA.
    The Committee is unable to support an additional 
$100,000,000 for IDA requested by the President. According to a 
speech by the Secretary of the Treasury on April 12, 2002, the 
World Bank has met the conditions that allow for an additional 
contribution of $100,000,000. While the Committee agreed with 
the former Secretary of Treasury that the World Bank needs a 
more rigorous method of measuring results of its programs, the 
Committee raised concerns in House Report 107-663 about the 
process of developing benchmarks for assessing aid, a process 
that is not straightforward or precise. The Committee 
specifically required in House Report 107-663 that it be 
consulted on an on-going basis as benchmarks were developed and 
programs were evaluated. The Committee was never consulted 
before or after the Secretary of Treasury determined that 
conditions had been met to allow for an additional contribution 
to IDA, therefore the Committee is unable to support the 
additional funds. Additionally, the Committee is unable to 
provide the amount requested for past payments due because of 
the Committee's low budget allocation.

      Contribution to the Multilateral Investment Guarantee Agency





Fiscal year 2003 level................................        $1,620,398
Fiscal year 2004 request..............................         4,001,672
Committee recommendation..............................         4,001,672


             (LIMITATION ON CALLABLE CAPITAL SUBSCRIPTIONS)




Fiscal year 2003 level................................      ($7,610,000)
Fiscal year 2004 request..............................      (16,339,982)
Committee recommendation..............................      (16,339,982)


    The Committee is providing $4,001,672 for past payments due 
by the United States to the World Bank's Multilateral 
Investment Guarantee Agency, the same as the request and 
$2,381,274 above the 2003 enacted level.

              General Concerns About the World Bank Group


                               OBJECTIVES

    The Committee is concerned that few of the many reform 
proposals for the World Bank over the years have resulted in 
major changes to the Bank's basic structure or function.
    Additionally, the Committee is concerned about the 
expansion of the Bank's focus from development functions to 
humanitarian lending, cultural projects, and post-conflict 
reconstruction. The Bank appears to continually re-create its 
mission, yet the Bank cannot have a comparative advantage in 
every sector and project. The mission creep at the Bank has 
resulted in a cumbersome bureaucratic environment and sluggish 
procedures that reduce the Bank's effectiveness and possibly 
future financial support.
    The Committee believes the World Bank and other 
multilateral development banks should have a clear set of 
objectives with the top priority to raise the standard of 
living of people throughout the world. The Committee supports 
the Treasury Department's attempts to focus the World Bank's 
core objective on raising per capita income and economic 
growth.

                      AVAILABILITY OF INFORMATION

    The Committee again requests copies of all annual reports 
and information about the basic functions of each institution 
as they come available. Future and continued support for the 
banks cannot be guaranteed unless future requests are justified 
by the Department of Treasury as well as the management of each 
individual institution.

                 Inter-American Investment Corporation





Fiscal year 2003 level................................       $18,232,381
Fiscal year 2004 request..............................        30,898,488
Committee recommendation..............................  ................


    The Committee recommends no appropriation for past due 
payments for the Inter-American Investment Corporation (IIC). 
The recommendation is $30,898,000 less than the request and 
$18,233,000 less than the 2003 enacted level.
    The Committee notes the deteriorating portfolio of the IIC 
and the net loss of $41,000,000 posted in calendar year 2002. 
The Committee is also aware that discussions are underway among 
InterAmerican Bank members regarding the future of the IIC and 
future financing options to re-capitalize the IIC. Therefore, 
the Committee is unable to support the budget request for 
payments to the IIC when other fully functioning international 
financial institutions in the Committee's jurisdiction should 
be made a priority with the limited budget allocation.

                      Multilateral Investment Fund





Fiscal year 2003 level................................       $24,430,828
Fiscal year 2004 request..............................        32,614,172
Committee recommendation..............................        25,000,000


    The Committee recommends an appropriation of $25,000,000 
for past due payments for the Multilateral Investment Fund 
(MIF). The recommendation is $7,614,172 below the request and 
$569,172 above the 2003 enacted level.
    The Multilateral Investment Fund (MIF) is the major source 
of multilateral technical assistance grants for micro and small 
business development in Latin America and the Caribbean.

        CONCERNS ABOUT THE INTER-AMERICAN DEVELOPMENT BANK (IDB)

    The Committee is concerned about recent public allegations 
that the procurement procedures at the IDB are neither 
transparent nor consistent. The Committee urges the IDB to 
establish an independent inspection panel to investigate and 
respond to private sector procurement complaints. The Committee 
directs the Secretary of Treasury to report back to the 
Committee no later than 120 days after enactment of this Act of 
the IDB's progress in setting up such an inspection panel.

               Contribution to the Asian Development Fund





Fiscal year 2003 level................................       $97,249,873
Fiscal year 2004 request..............................       151,921,405
Committee recommendation..............................       151,921,405


    The Committee recommends an appropriation of $151,921,405 
for the concessional Asian Development Fund, an amount that is 
the same as the level requested and $54,671,532 more than the 
fiscal year 2003 enacted level. The Committee recommends that 
$103,000,000 be made available for the scheduled payment to the 
Asian Development Fund and $48,921,405 for past payments due.
    The Committee is providing the entire amount requested for 
the Asian Development Fund in light of United States efforts to 
reform the operations of the Asian Development Bank (AsDB). The 
Committee supports the continuing focus by the United States 
Executive Director on issues relating to personnel, 
procurement, host country contracting, inspection, 
transparency, and performance based allocation of concessional 
loans at the AsDB. The Committee commends the regular contact 
by the United States Executive Director and his efforts to keep 
the Committee members informed of AsDB issues.

              Contribution to the African Development Bank





Fiscal year 2003 level................................        $5,071,294
Fiscal year 2004 request..............................         5,104,930
Committee recommendation..............................         5,104,930


             (LIMITATION ON CALLABLE CAPITAL SUBSCRIPTIONS)




Fiscal year 2003 level................................     ($79,603,000)
Fiscal year 2004 request..............................      (79,609,817)
Committee recommendation..............................      (79,609,817)


    The Committee recommends an appropriation of $5,104,930 for 
the African Development Bank, an amount that is $33,626 above 
the amount provided in fiscal year 2003 and the same as the 
amount requested. The Committee intends that $5,100,000 of the 
amount provided be for the annual United States payment and 
$4,930 for past payments due.

              Contribution to the African Development Fund





Fiscal year 2003 level................................      $107,370,856
Fiscal year 2004 request..............................       118,080,826
Committee recommendation..............................       107,370,856


    The recommendation for the concessional African Development 
Fund is $107,370,856, which is $10,709,970 less than the amount 
requested and the same as the amount provided in fiscal year 
2003.

  Contribution to the European Bank for Reconstruction and Development





Fiscal year 2003 level................................       $35,572,223
Fiscal year 2004 request..............................        35,431,111
Committee recommendation..............................        35,431,111


             (LIMITATION ON CALLABLE CAPITAL SUBSCRIPTIONS)




Fiscal year 2003 level................................    ($123,237,803)
Fiscal year 2004 request..............................     (122,085,497)
Committee recommendation..............................     (122,085,497)


    The Committee is recommending $35,431,111 for the European 
Bank for Reconstruction and Development. This amount is the 
same as the President's request and $141,112 more than the 
appropriation provided in fiscal year 2003.

  Contribution to the International Fund for Agricultural Development





Fiscal year 2003 level................................       $14,906,143
Fiscal year 2004 request..............................        15,004,042
Committee recommendation..............................        15,004,042


    The Committee is again providing a separate appropriation 
for the International Fund for Agricultural Development (IFAD), 
reflecting the assumption of responsibility for this 
multilateral institution by the Department of the Treasury in 
February, 2000. The fiscal year 2004 recommendation is 
$15,004,042, the same as the request and $97,899 below the 
amount provided in fiscal year 2003. This amount includes 
$15,000,000 for the first scheduled contribution under the 
recently concluded negotiations of IFAD's Sixth Replenishment 
(IFAD-VI) and $4,042 for amounts previously due.
    The Committee is alarmed by the sudden reversal of opinion 
by the Treasury General Counsel that an authorization is no 
longer needed for the United States to participate in IFAD. It 
is the Committee's opinion that an authorization for IFAD-VI is 
necessary, therefore the Committee has included an 
authorization for United States participation in IFAD-VI in the 
general provisions of the Act. The Committee directs the 
Secretary of Treasury to inform the Committee in the case of 
future legal opinions that impact the funds in this Act.
    The Committee is aware, more than ever, that poverty is one 
of the most serious obstacles to political, economic and social 
development and stability, particularly because the majority of 
the world's poor lives in rural areas and is reliant on 
agriculture for their livelihoods and survival. The Committee 
recognizes that the efforts of organizations such as IFAD, with 
its focus on agriculture and rural areas, are crucial for these 
nations' successful development. IFAD is commended for its 
continuing efforts.

                International Organizations and Programs





Fiscal year 2003 level................................      $193,882,000
Fiscal year 2004 request..............................       314,550,000
Committee recommendation..............................       194,550,000


    The Committee has recommended $194,550,000 for 
International Organizations and Programs. This is $668,000 
above the fiscal year 2003 level and $120,000,000 less than the 
President's request. As in fiscal year 2003, funding for a 
grant to UNICEF is provided in the ``Child Survival and Disease 
Programs Fund'' under title II. Once this funding is taken into 
account, the Committee recommendation is the same as the 
request. The United Nations Population Fund (UNFPA) is 
discussed in section 561.
    The Committee recommendation also continues prior year bill 
language prohibiting the use of funds for the Korean Peninsula 
Energy Development Organization (KEDO) or the International 
Atomic Energy Agency (IAEA). Both organizations are funded 
under ``Nonproliferation, Anti-Terrorism, Demining and Related 
Programs''.

                   UNITED NATIONS DEVELOPMENT PROGRAM

    The Committee recommends a level not less than $100,000,000 
in International Organizations and Programs funding be set 
aside to support the United Nations Development Program (UNDP).

          UNITED NATIONS VOLUNTARY FUND FOR VICTIMS OF TORTURE

    The Committee supports not less than $6,000,000 for the 
United States contribution to the United Nations Voluntary Fund 
for Victims of Torture. Assisting these centers not only 
reinforces United States opposition to human rights violations 
but also has proven to be an effective method for lessening the 
incidence of torture and promotes human rights and democracy 
abroad. The Committee urges the Department of State to 
negotiate with other governments to persuade them to increase 
their contributions to the Fund and report to the Committee by 
February 15, 2004 on its efforts.

                      TITLE V--GENERAL PROVISIONS

    The Committee recommends that 18 of the general provisions 
carried in the fiscal year 2002 Act be deleted. These 
provisions (sections 501, 506, 510, 525, 531, 554, 555, 556, 
557, 567, 569, 570, 571, 574, 580, 581, 583, 585, and 586) are 
either addressed elsewhere in permanent law, have been 
considered by the appropriate authorizing committee, or are no 
longer necessary.
    The Committee recommends the following new and revised 
general provisions.
    Sec. 502, ``Private and Voluntary Organizations'' is 
modified by deleting subsection (b) of the 2003 Act.
    Sec. 506, ``Prohibition on Taxation of United States 
Assistance'' is modified by deleting the GAO reporting 
requirement.
    Sec. 507, ``Prohibition Against Direct Funding for Certain 
Countries'' is revised to delete Iraq and Sudan. Additionally 
the provisos pertaining to Iraq are deleted.
    Sec. 515, ``Notification Requirements'' is modified to 
exempt the reprogramming requirements for funds appropriated 
under title II of the Act.
    Sec. 517, ``Independent States of the Former Soviet Union'' 
is modified by the deletion of subsection (f) from the 2003 
Act.
    Sec. 520, ``Special Notification Requirements'' is modified 
to add Cambodia and to delete Serbia, Pakistan, and Colombia.
    Sec. 522, ``Child Survival and Health Activities'' is 
revised by deleting the requirement that $446,000,000 shall be 
made available for family planning/reproductive health; the 
notwithstanding authority for funds provided in the Child 
Survival and Health Activities account is modified to conform 
with changes made by Public Law 108-25.
    Sec. 523, ``Afghanistan'' is modified by deleting the 
entire section except the amount specified for Afghanistan and 
the amount specified from the Economic Support Fund and by 
adding Title III.
    Sec. 525, ``USAID Overseas Personnel'' is a new general 
provision intended to allow certain contract personnel serving 
overseas to receive limited appointments in the Foreign Service 
during such service.
    Sec. 526, ``Tibet'' is modified by renaming the ``Democracy 
Programs'' and deleting all language from the 2003 Act except 
for the ceiling of $3,000,000 for certain activities in Tibet 
that are undertaken by nongovernmental organizations 
incorporated outside of China and the notification 
requirements. The notwithstanding authority for the National 
Endowment for Democracy is retained but moved to section 534 
``Special Authorities''.
    Sec. 531, ``Burma'' is modified by reducing the funding 
floor to $6,000,000 for democracy activities along the Burma-
Thailand border, assist displaced Burmese, and for activities 
of Burmese student groups.
    Sec. 534, ``Special Authorities'' is revised by: in 
subsection (a) expanding the notwithstanding of section 512 of 
this Act to include Pakistan; in subsection (g) by extending 
the authorities contained in section 602 of Public Law 107-206 
regarding the shipment of humanitarian assistance; by deleting 
subsections (i) and (j) of the 2003 Act; and by adding a new 
subsection (i) that gives notwithstanding authority for the 
National Endowment for Democracy that was included in section 
526 of the 2003 Act.
    Sec. 536, ``Administration of Justice Activities'' is 
modified to extend the authority beyond the current fiscal 
year.
    Sec. 539, ``Reservations of Funds'' is modified by renaming 
the section ``Earmarks'' from the 2003 Act.
    Sec. 551, ``Caribbean Basin'' is renamed ``Haiti'' and 
makes eligible the Government of Haiti to purchase defense 
articles for the Coast Guard. Subsections (b) and (c) from the 
2003 Act are deleted.
    Sec. 554. ``Foreign Military Training Report'' is modified 
by clarifying that a single Foreign Military Training Report 
(as required under section 656 of the Foreign Assistance Act) 
is sufficient and this annual report shall be submitted to both 
the House Committee on International Relations and Senate 
Committee on Foreign Relations and the Committees on 
Appropriations of the House and Senate.
    Sec. 555. ``Korean Peninsula Energy Development 
Organization'' is modified by deleting all except the 
prohibition of funds for this Act for KEDO.
    Sec. 557, ``Colombia'' is similar to section 564 of the 
fiscal year 2003 appropriations act and is modified to require 
the Secretary of State to determine and certify that the 
Colombian Armed Forces are meeting certain human rights 
conditions before 25 percent of the funds for the Colombian 
Armed Forces are made available.
    Sec. 561, ``Contributions to the United Nations Population 
Fund'' is identical except for technical date changes to 
section 568 of the House-Reported Foreign Operations, Export 
Financing, and Related Programs Bill, 2003 (H.R. 5410).
    Sec. 566, ``Community Based Police Assistance'' is similar 
to section 582 of the 2003 Act except the GAO reporting 
requirement is deleted.
    Sec. 567, ``Trade Capacity Building'' is similar to section 
584 of the 2003 Act but the level of funding is modified to 
$517,000,000.
    Sec. 568, ``Special Debt Relief for the Poorest'' is a new 
general provision, but the same as included in the 2002 Act, 
that authorizes the Heavily Indebted Poor Countries (HIPC) 
initiative including bilateral debt relief and contributions to 
the HIPC Trust Fund.
    Sec. 569, ``Authority to Engage in Debt Buybacks or Sales'' 
is a new general provision, but the same as included in the 
2002 Act, that authorizes debt buybacks and sales, necessary 
for implementing the Tropical Forest Conservation Act programs.
    Sec. 570, ``Cambodia'' is similar to section 560 of the 
2003 Act but deletes subsections (b), (c) and (d).
    Sec. 571, ``Cuba'' is the same general provision as 
included in the House-Reported Foreign Operations, Export 
Financing and Related Programs Bill, 2003 (H.R. 5410) and 
prohibits counternarcotics assistance in this Act to the 
Government of Cuba.
    Sec. 572, ``Competition in Contracting'' requires new and 
follow-on contracts for reconstruction and related activities 
in Iraq to be only through use of full and open competitive 
procedures. The Committee also reiterates its directive on page 
27 of House Report 108-55 regarding the involvement, where 
feasible, of small, minority, and disadvantaged business 
enterprises in awards for Iraq reconstruction.
    Sec. 573, ``Disaster Surge Capacity'' is a new general 
provision that provides additional personnel flexibility for 
USAID to meet unexpected staffing needs in its Office of 
Foreign Disaster Assistance, Office of Transition Initiatives, 
and Food for Peace.
    Sec. 574, ``Authorizations'' is a new general provision 
that authorizes the United States participation in the sixth 
replenishment of the International Fund for Agriculture 
Development.
    Sec. 575, ``Clarification of Role of USAID'' is a new 
general provision that clarifies the role of USAID in 
conjunction with the Millennium Challenge Corporation.
    Sec. 576. ``Philippine Education and Health 
Infrastructure'' is a new general provision which clarifies 
that $600,000 of the $30,000,000 provided in the Emergency 
Wartime Supplemental for the Philippines under the heading 
``Economic Support Fund'' shall be available only for American 
non-governmental organizations for upgrading education and 
health infrastructure in Jolo in the Sulu Archipelago.
    Sec. 577. ``Basic Education'' 'is a new general provision 
that establishes a minimum level within title II of this Act 
for basic education programs of $350,000,000, of which not less 
than $91,500,000 should be derived from the ``Economic Support 
Fund''.

               PROVISIONS RETAINED FROM FISCAL YEAR 2003

    The following general provisions from the fiscal year 2003 
Act are retained in the fiscal year 2004 Act unchanged except 
for technical corrections, references to fiscal year 2004, and 
new section numbers where appropriate:
    Sec. 501. Compensation for United States Executive 
Directors to International Financial Institutions.
    Sec. 503. Limitation on Residence Expenses.
    Sec. 504. Limitation on Expenses.
    Sec. 505. Limitation on Representational Allowances.
    Sec. 508. Military Coups.
    Sec. 509. Transfers.
    Sec. 511. Availability of Funds.
    Sec. 512. Limitation on Assistance to Countries in Default.
    Sec. 513. Commerce and Trade.
    Sec. 514. Surplus Commodities.
    Sec. 516. Limitation on Availability of Funds for 
International Organizations and Programs.
    Sec. 518. Prohibition on Funding for Abortions and 
Involuntary Sterilization.
    Sec. 519. Export Financing Transfer Authorities.
    Sec. 521. Definition of Program, Project, and Activity.
    Sec. 524. Notification of Excess Defense Equipment.
    Sec. 527. Prohibition on Bilateral Assistance to Terrorist 
Countries.
    Sec. 528. Debt-for-Development.
    Sec. 529. Separate Accounts.
    Sec. 530. Enterprise Fund Restrictions.
    Sec. 532. Authorities for the Peace Corps, Inter-American 
Foundation and African Development Foundation.
    Sec. 533. Impact on Jobs in the United States.
    Sec. 535. Arab League Boycott of Israel.
    Sec. 537. Eligibility for Assistance.
    Sec. 539. Ceilings and Earmarks.
    Sec. 540. Prohibition on Publicity and Propaganda.
    Sec. 541. Prohibition of Payments to United Nations 
Members.
    Sec. 542. Nongovernmental Organizations--Documentation.
    Sec. 543. Prohibition on Assistance to Foreign Governments 
that Export Lethal Military Equipment to Countries Supporting 
International Terrorism.
    Sec. 544. Withholding of Assistance for Parking Fines Owed 
by Foreign Governments.
    Sec. 545. Limitation on Assistance for the PLO for the West 
Bank and Gaza.
    Sec. 546. War Crimes Tribunals Drawdown.
    Sec. 547. Landmines.
    Sec. 548. Restrictions Concerning the Palestinian 
Authority.
    Sec. 549. Prohibition of Payment of Certain Expenses.
    Sec. 550. Restrictions on Voluntary Contributions to United 
Nations Agencies.
    Sec. 552. Limitation on Assistance to the Palestinian 
Authority.
    Sec. 553. Limitation on Assistance to Security Forces.
    Sec. 556. Palestinian Statehood.
    Sec. 558. Illegal Armed Groups.
    Sec. 559. Prohibition on Assistance to the Palestinian 
Broadcasting Corporation.
    Sec. 560. West Bank Gaza Program.
    Sec. 562. Procurement and Financial Management Reform.
    Sec. 563. War Criminals.
    Sec. 564. User Fees.
    Sec. 565. Funding for Serbia.
    Sec. 567. Trade Capacity Building.

              House of Representatives Report Requirements


                           Transfer of Funds

    Pursuant to clause 3(f)(2) of rule XIII of the Rules of the 
House of Representatives, the following is submitted describing 
the transfer of funds provided in the accompanying bill.
    Under ``Child Survival and Health Programs'' up to 
$6,000,000 may be transferred to and merged with funds under 
the heading ``Operating Expenses of the United States Agency 
for International Development.''
    Under ``Child Survival and Health Programs'' up to 
$35,000,000 may be transferred to the Centers for Disease 
Control and Prevention''.
    Under ``Operating Expenses of the United States Agency for 
International Development'', not to exceed $15,000,000 may be 
derived by transfer from the Iraq Relief and Reconstruction 
Fund (P.L. 108-11) to support the USAID mission in Iraq.
    Under ``Development Credit Authority'' up to $21,000,000 is 
authorized to be transferred to the account from a variety of 
sources. In addition, $8,000,000 may be transferred to and 
merged with funds appropriated under the heading ``Operating 
Expenses of the United States Agency for International 
Development''.

                              RESCISSIONS

    Clause 3(f)(2) of rule XIII of the Rules of the House of 
Representatives requires a separate listing of rescissions. 
There are no rescissions recommended in the accompanying bill.

                        Constitutional Authority

    Clause 3(d)(1) of rule XIII of the Rules of the House of 
Representatives states that:

          Each report of a committee on a bill or joint 
        resolution of a public character, shall include a 
        statement citing the specific powers granted to the 
        Congress in the Constitution to enact the law proposed 
        by the bill or joint resolution.

    The Committee on Appropriations bases its authority to 
report this legislation from Clause 7 of Section 9 of Article I 
of the Constitution of the United States of America which 
states:

          No money shall be drawn from the Treasury but in 
        consequence of Appropriations made by law * * *

    Appropriations contained in this Act are made pursuant to 
this specific power granted by the Constitution.

               Changes in the Application of Existing Law

    Pursuant to clause 3(f), rule XIII of the Rules of the 
House of Representatives, the following statements are 
submitted describing the effects of provisions in the 
accompanying bill which directly or indirectly change the 
application of existing law. Most of the language has been 
provided in previous measures including supplementals for the 
departments and agencies carried in the accompanying bill.
    1. The bill contains appropriations for a number of items 
for which authorizations for fiscal year 2004 have not yet been 
enacted. The bill allows funds appropriated in the bill to be 
obligated in the absence of a prior authorization of 
appropriations.
    2. The bill provides that a few of the appropriations shall 
remain available for obligation beyond the current fiscal year. 
In all cases it is deemed desirable to carry such language in 
order to provide for orderly administration of such programs 
and effective use of funds.
    3. The bill contains a number of general provisions and 
other language that have been carried in the bill in past 
years.
    4. Under ``Export-Import Bank of the United States'', 
authority is provided for subsection (a) of section 117 to 
remain in effect until October 1, 2004.
    5. Under ``Overseas Private Investment Corporation, Program 
Account'', funds are appropriated for the cost of direct and 
guaranteed loans, to be derived by transfer from the Overseas 
Private Investment Corporation Noncredit Account. Such costs 
shall be as defined in section 502 of the Congressional Budget 
Act of 1974 and may be used for direct loan and loan guaranty 
commitments incurred or made during fiscal years 2004 and 2005. 
These funds are available for obligation until 2012 and 2013, 
depending on the initial date of obligation.
    6. Under ``Child Survival and Health Programs Fund'' 
language is provided that indicates how the funds should be 
allocated among various activities; not to exceed $250,000, in 
addition to funds otherwise available for such purposes, may be 
used to monitor and provide oversight of programs for displaced 
and orphaned children and victims of war; up to $60,000,000 is 
authorized to be made available for a contribution to The 
Vaccine Fund; and language is included that provides that 
$870,830,000 shall be directly apportioned to the Office of the 
AIDS Coordinator of which not less than $400,000,000, subject 
to matching contributions, shall be made available for a 
contribution to the Global Fund to Fight AIDS, Tuberculosis and 
Malaria, and shall be expended at the minimum rate necessary to 
make timely payments for projects and activities.
    7. Under ``Development Assistance'', language is provided 
that indicates how the funds should be allocated among various 
activities, including $194,000,000 for trade capacity building 
and $350,000,000 for basic education.
    8. Under ``Development Credit Authority'', authorized 
transfers, when added to the funds transferred pursuant to the 
authority contained under this heading in Public Law 107-115, 
shall not exceed $21,000,000.
    9. Under ``Operating Expenses of the United States Agency 
for International Development'' not to exceed $15,000,000 may 
be derivied by transfer from the Iraq Relief and Reconstruction 
Fund.
    10. Under ``Capital Investment Fund'', the Administrator of 
USAID is authorized to change fair and reasonable rent in 
buildings constructed using funds appropriated under this 
heading, and such rental payments are designated as offsetting 
collections; and the assignment of employees or contractors to 
buildings is subject to the concurrence of the Administrator of 
USAID.
    11. Under ``Economic Support Fund'', not less than 
$480,000,000 is made available only for Israel and is required 
to be disbursed as a cash grant within 30 days of enactment of 
this Act; and not less than $575,000,000 is made available only 
for Egypt; $250,000,000 should be made available only for 
assistance for Jordan; not less than $35,000,000 should be 
available for Lebanon of which not less than $4,000,000 should 
be available for American educational institutions for 
scholarships and other programs; and not less than $12,000,000 
should be available for Cyprus; and $67,000,000 shall be 
available to the Department of State Office of Overseas 
Buildings Operation for construction of United States Agency 
for International Development facilities.
    12. Under ``Assistance for the Independent States of the 
Former Soviet Union'', not less than $63,000,000 should be made 
available for assistance for child survival and health 
activities.
    13. Under ``African Development Foundation'', funds made 
available to grantees may be invested for project purposes when 
authorized by the Board of Directors, instead of by the 
President as in current law.
    14. Under ``Peace Corps'' the Director of the Peace Corps 
may make appointments or assignments, or extend current 
appointments or assignments, to permit United States citizens 
to serve for periods in excess of five years in the case of 
individuals whose appointment or assignment, such as regional 
safety security officers and employees within the Office of the 
Inspector General, involves the safety of Peace Corps 
volunteers. The Director may make such appointments or 
assignments notwithstanding the provisions of section 7 of the 
Peace Corps Act.
    15. Under ``Millennium Challenge Account'' $800,000,000 is 
available contingent upon enactment of authorization.
    16. Under ``International Narcotics Control and Law 
Enforcement'', a limitation of $24,180,000 is placed on 
administrative expenses.
    17. Under ``Andean Counterdrug Initiative'', assistance for 
Colombia is made available consistent with the provisions 
authorizing and limiting such assistance as are contained in 
Public Law 107-206; section 482(b) of the Foreign Assistance 
Act is waived, subject to notification; the Secretary of State, 
in consultation with the Administrator of USAID, shall provide 
to the Committee 45 days after the date of enactment a report 
on the proposed uses of all funds under this heading on a 
country-by-country basis for each proposed program, project or 
activity; in addition, a limitation of $15,680,000 is placed on 
administrative expenses of the Department of State, and not 
more than $4,500,000 may be available for administrative 
expenses of the United States Agency for International 
Development.
    18. Under ``Nonproliferation, Anti-terrorism, Demining, and 
Related Programs'', a limitation of $20,000,000 is placed on 
funding for the Nonproliferation and Disarmament Fund.
    19. Under ``Debt Restructuring'' funds are provided for the 
cost of selling, reducing or canceling debts owed to the United 
States, and modifying concessional credit agreements with least 
developed countries, and of canceling amounts owed as a result 
of loans or guarantees. In addition funds are provided for the 
Secretary of Treasury to pay the Heavily Indebted Poor 
Countries Trust Fund amounts for the benefits of countries that 
are eligible for debt reduction.
    20. Under ``Foreign Military Financing Program'', not less 
than $2,160,000,000 is appropriated for Israel, of which not 
less than $568,000,000 shall be available for the procurement 
in Israel of defense articles and defense services and that all 
funds for Israel must be disbursed within 30 days of enactment 
of this Act; $1,300,000,000 shall be made available for grants 
only for Egypt; a limitation of $40,500,000 is provided for 
administrative expenses; and a limitation of $361,000,000 from 
certain other funds may be obligated for expenses incurred 
pursuant to section 43(b) of the Arms Export Control Act.
    21. Under title IV, funds for a number of international 
financial institutions are made available for contributions; 
funds are made available for the United States share of the 
paid-in portion of the increase in capital stock of certain 
institutions; and limitations are placed on callable capital 
subscriptions.
    22. Under ``General Provisions'':
    Sec. 502, ``Private and Voluntary Organizations'' is 
modified by deleting subsection (b) of the 2003 Act.
    Sec. 506, ``Prohibition on Taxation of United States 
Assistance'' is modified by deleting the GAO reporting 
requirement.
    Sec. 507, ``Prohibition Against Direct Funding for Certain 
Countries'' is revised to delete Iraq and Sudan. Additionally 
the provisos pertaining to Iraq are deleted.
    Sec. 515, ``Notification Requirements'' is modified to 
exempt the reprogramming requirements for funds appropriated 
under title II of the Act.
    Sec. 517, ``Independent States of the Former Soviet Union'' 
is modified by the deletion of subsection (f) from the 2003 
Act.
    Sec. 520, ``Special Notification Requirements'' is modified 
to add Cambodia and to delete Serbia, Pakistan, and Colombia.
    Sec. 522, ``Child Survival and Health Activities'' is 
revised by deleting the requirement that $446,000,000 shall be 
made available for family planning/reproductive health; the 
notwithstanding authority for funds provided in the Child 
Survival and Health Activities account is modified to conform 
with changes made by Public Law 108-25.
    Sec. 523, ``Afghanistan'' is modified by deleting the 
entire section except the amount specified for Afghanistan and 
the amount specified from the Economic Support Fund.
    Sec. 525, ``USAID Overseas Personnel'' is a new general 
provision allowing the use of certain program funds to pay 
salaries and expenses of limited term foreign service officers.
    Sec. 526, ``Tibet'' is modified by renaming the ``Democracy 
Programs'' and deleting all language from the 2003 Act except 
for the ceiling of $3,000,000 for certain activities in Tibet 
that are undertaken by nongovernmental organizations 
incorporated outside of China and the notification 
requirements. The notwithstanding authority for the National 
Endowment for Democracy is retained but moved to section 534 
``Special Authorities''.
    Sec. 531, ``Burma'' is modified by reducing the funding 
floor to $6,000,000 for democracy activities along the Burma-
Thailand border, assist displaced Burmese, and for activities 
of Burmese student groups.
    Sec. 534, ``Special Authorities'' is revised by: in 
subsection (a) expanding the notwithstanding of section 512 of 
this Act to include Pakistan; in subsection (g) by extending 
the authorities contained in section 602 of Public Law 107-206 
regarding the shipment of humanitarian assistance; by deleting 
subsections (i) and (j) of the 2003 Act; and by adding a new 
subsection (i) that gives notwithstanding authority for the 
National Endowment for Democracy that was included in section 
526 of the 2003 Act.
    Sec. 536, ``Administration of Justice Activities'' is 
modified to extend the authority beyond the current fiscal 
year.
    Sec. 539, ``Reservations of Funds'' is modified by renaming 
the section ``Earmarks'' from the 2003 Act.
    Sec. 551, ``Caribbean Basin'' is renamed ``Haiti'' and 
makes eligible the Government of Haiti to purchase defense 
articles for the Coast Guard. Subsections (b) and (c) from the 
2003 Act are deleted.
    Sec. 554. ``Foreign Military Training Report'' is modified 
by clarifying that a single Foreign Military Training Report 
(as required under section 656 of the Foreign Assistance Act) 
is sufficient, and this annual report shall be submitted to 
both the House Committee on International Relations and Senate 
Committee on Foreign Relations and the Committees on 
Appropriations of the House and Senate.
    Sec. 555. ``Korean Peninsula Energy Development 
Organization'' is modified by deleting all except the 
prohibition of funds for this Act for KEDO.
    Sec. 557, ``Colombia'' is similar to section 564 of the 
fiscal year 2003 appropriations act and is modified to require 
the Secretary of State to determine and certify that the 
Colombian Armed Forces are meeting certain human rights 
conditions before 25 percent of the funds for the Colombian 
Armed Forces are made available.
    Sec. 561, ``Contributions to the United Nations Population 
Fund'' is identical except for technical date changes to 
section 568 of the House-Reported Foreign Operations, Export 
Financing, and Related Programs Bill, 2003 (H.R. 5410).
    Sec. 566, ``Community Based Police Assistance'' is similar 
to section 582 of the 2003 Act except the GAO reporting 
requirement is deleted.
    Sec. 567, ``Trade Capacity Building'' is similar to section 
584 of the 2003 Act but the level of funding is modified to 
$517,000,000.
    Sec. 568, ``Special Debt Relief for the Poorest'' is a new 
general provision, but the same as included in the 2002 Act, 
that authorizes the Heavily Indebted Poor Countries (HIPC) 
initiative including bilateral debt relief and contributions to 
the HIPC Trust Fund.
    Sec. 569, ``Authority to Engage in Debt Buybacks or Sales'' 
is a new general provision, but the same as included in the 
2002 Act, that authorizes debt buybacks and sales, necessary 
for implementing the Tropical Forest Conservation Act programs.
    Sec. 570, ``Cambodia'' is similar to section 560 of the 
2003 Act but deletes subsections (b), (c) and (d).
    Sec. 571, ``Cuba'' is the same general provision as 
included in the House-Reported Foreign Operations, Export 
Financing and Related Programs Bill, 2003 (H.R. 5410) and 
prohibits counternarcotics assistance in this Act to the 
Government of Cuba.
    Sec. 573, ``Disaster Surge Capacity'' is a new general 
provision that provides additional personnel flexibility for 
USAID to meet unexpected staffing needs in its Office of 
Foreign Disaster Assistance, Office of Transition Initiatives, 
and Food for Peace.
    Sec. 574, ``Authorizations'' is a new general provision 
that authorizes the United States participation in the sixth 
replenishment of the International Fund for Agriculture 
Development.
    Sec. 575, ``Clarification of Role of USAID'' is a new 
general provision that clarifies the role of USAID in 
conjunction with the Millennium Challenge Corporation.
    Sec. 576, ``Philippine Education and Health 
Infrastructure'' is a new general provision that makes $600,000 
of Economic Support Funds in the Emergency Wartime Supplemental 
Act, 2003 available for upgrading education and health 
infrastructure in the Sulu Archipelago.
    Sec. 577, ``Basic Education'' is a new general provision 
that makes not less than $350,000,000 in title II available for 
basic education and of which not less than $91,500,000 should 
be from the Economic Support Fund. Includes reporting 
requirements for the Department of State and USAID.

                  Appropriations Not Authorized by Law

    Pursuant to clause 3(f)(1) of rule XIII of the Rules of the 
House of Representatives, the following table lists the 
appropriations in the accompanying bill which, in whole or in 
part, are not authorized by law:


                                                                           Appropriations in
                                       Last year         Authorization       last year of      Appropriations in
                                      authorized             level           authorization         this bill

Overseas Private Investment       2003..............  Such sums as may    39,626,000........  41,385,000.
 Corporation Administrative                            be necessary.
 Expenses.
Overseas Private Investment       2003..............  Such sums as may    23,844,000........  24,000,000.
 Corporation Noncredit Account.                        be necessary.
Child Survival and Health         Population (1987);  Population          Population          $2,235,830,000
 Programs Fund (See note below).   Health and          ($290,000,000);     ($234,625,000);     (includes
                                   Disease             Health and          Health and          $368,500,000 for
                                   Prevention          Disease             Disease             population).
                                   (1987); Child       Prevention          Prevention
                                   Survival Fund       ($180,000,000);     ($166,762,500);
                                   (1987).             Child Survival      Child Survival
                                                       Fund                Fund
                                                       ($75,000,000).      ($75,000,000).
Development Assistance (See note  Agriculture         Agriculture         Agriculture         $1,317,000,000
 below).                           (1987); Education   ($760,000,000);     ($639,613,000);     (includes
                                   (1987); Energy      Education           Education           $350,000,000 for
                                   and selected        ($180,000,000);     ($155,000,000);     basic education;
                                   development         Energy and          Energy and          other programs
                                   activities (1987).  selected            selected            difficult to
                                                       development         development         determine due to
                                                       activities          activities          changing
                                                       ($207,000,000).     ($149,990,000).     definitions of
                                                                                               programs since
                                                                                               last authorized).
International Disaster and        1987..............  $25,000,000.......  $70,000,000.......  $315,500,000.
 Famine Assistance.
Transition initiatives..........  None (same          ..................  ..................  $55,000,000.
                                   authorities as
                                   international
                                   disaster
                                   assistance).
Development credit authority....  None..............  ..................  ..................  ($21,000,000).
Development credit authority      None..............  ..................  ..................  $8,000,000.
 administrative expenses.
Payment to the Foreign Service    None; mandatory     ..................  ..................  $43,859,000.
 Retirement and Disability Fund.   item.
Operating expenses of the United  1987..............  $387,000,000......  $340,600,000......  $604,100,000.
 States Agency for International
 Development.
Capital Investment Fund.........  None..............  ..................  ..................  $49,300,000.
Operating Expenses of the United  1987..............  $21,750,000.......  $21,000,000.......  $35,000,000.
 States Agency for International
 Development Inspector General.
Economic Support Fund...........  1987..............  $3,800,000,000....  $3,555,000,000....  $2,240,500,000.
International Fund for Ireland..  1988..............  $35,000,000.......  $35,000,000.......  $19,600,000.
Assistance for Eastern Europe     None..............  ..................  ..................  $452,000,000.
 and the Baltic States (See note
 below).
Assistance for the Independent    1993..............  $410,000,000......  $417,000,000......  $576,000,000.
 States of the Former Soviet
 Union.
Inter-American Foundation.......  1987..............  $11,969,000.......  $11,800,000.......  $15,185,000.
African Development Foundation..  1987..............  $3,872,000........  $6,500,000........  $17,689,000.
Peace Corps.....................  2003..............  $365,000,000......  $295,069,000......  $314,000,000.
Millennium Challenge Corporation  None..............  ..................  ..................  $800,000,000.
International Narcotics Control   1994..............  $171,500,000......  $100,000,000......  $241,700,000.
 and Law Enforcement.
Andean Counterdrug Initiative...  None..............  ..................  ..................  $731,000,000.
Migration and Refugee Assistance  2001..............  $750,000,000......  $700,000,000......  $760,197,000.
U.S. Emergency Refugee and        1962..............  Such amounts as     N/A...............  $15,831,000.
 Migration Assistance Fund (See                        may be necessary.
 note below).
Nonproliferation, Anti-           None..............  ..................  ..................  $335,200,000.
 terrorism, demining and related
 programs (See note below).
International Affairs Technical   1999..............  $5,000,000........  $1,500,000........  $19,000,000.
 Assistance.
Debt restructuring..............  2001..............  $435,000,000......  $448,000,000        $95,000,000 (Note:
                                                                           (included up to     section 581
                                                                           $435,000,000 for    includes
                                                                           Heavily Indebted    additional
                                                                           Poor Countries      authorization for
                                                                           (HIPC) debt         HIPC debt relief,
                                                                           relief;             consistent with
                                                                           additional sums     appropriations
                                                                           for unauthorized    recommendation
                                                                           bilateral debt      for this
                                                                           relief).            account).
International Military Education  2003..............  $85,000,000.......  $79,480,000.......  $91,700,000.
 and Training.
Foreign Military Financing        2003..............  $4,107,000,000....  $6,104,632,000....  $4,314,000,000.
 Program.
Peacekeeping operations.........  1999..............  $83,000,000.......  $76,500,000.......  $85,000,000.
International Development         2002..............  $2,410,000,000      $792,400,000......  $850,000,000.
 Association.                                          over three years
                                                       (beginning in FY
                                                       2003).
African Development Fund........  2002..............  $300,000,000 over   $100,000,000......  $107,370,856.
                                                       three years
                                                       (beginning in FY
                                                       2000).
Asian Development Fund..........  2001..............  $400,000,000 over   $72,000,000.......  $151,921,405.
                                                       four years
                                                       (beginning in FY
                                                       1998).
International Organizations and   2001..............  Such sums as may    $186,000,000......  $194,550,000.
 Programs.                                             be necessary.
Contribution to the               2003..............  $30,000,000 over    $14,906,000.......  $15,004,000.
 International Fund for                                two years
 Agriculture Development.                              (beginning in FY
                                                       2002).

Note.--Programs recommended herein under ``Child Survival and Health Programs Fund'' and ``Development
  Assistance'' were last authorized under a different account structure than that recommended in this bill; the
  account structure included a number of functional accounts, as described above.
Note.--Programs recommended herein under ``Support for Eastern Europe and the Baltic States'' were last
  authorized in the Support for East European Democracy (SEED) Act of 1989; however, these funds were authorized
  for discrete programs and not for the account as a whole. In fiscal year 1991, the first general
  appropriations act after enactment of the SEED Act included $369,675,000 for this account.
Note.--Funds for the United States Emergency Refugee and Migration Assistance Program (ERMA) are authorized in
  such amounts as may be necessary; however, appropriations which would result in a balance in the fund of more
  than $100,000,000 are prohibited (22 U.S.C. 2601(c)) absent a waiver of this provision of law.
Note.--Programs recommended herein under ``Nonproliferation, Anti-terrorism, Demining, and Related Programs''
  include some major programs for which authorizations of appropriations were provided for fiscal year 2002;
  these programs include $73,000,000 authorized for anti-terrorism assistance and $142,000,000 authorized for
  nonproliferation activities. In addition, some programs now in this account were previously in accounts which
  had authorizations of appropriations in prior years.

                   Comparison With Budget Resolution

    Clause 3(c)(2) of rule XIII of the Rules of the House of 
Representatives requires an explanation of compliance with 
section 308(a)(1)(A) of the Congressional Budget and 
Impoundment Control Act of 1974 (Public Law 93-344), as 
amended, which requires that the report accompanying a bill 
providing new budget authority contain a statement detailing 
how the authority compares with the reports submitted under 
section 302 of the Act for the most recently agreed to 
concurrent resolution on the budget for the fiscal year from 
the Committee's section 302(a) allocation.

                                            [In millions of dollars]
----------------------------------------------------------------------------------------------------------------
                                                                 302(b) allocation--           This bill--
                                                             ---------------------------------------------------
                                                                 Budget                    Budget
                                                               authority     Outlays     authority     Outlays
----------------------------------------------------------------------------------------------------------------
Discretionary...............................................       17,120       20,185       17,120       20,182
Mandatory...................................................           44           44           44           44
----------------------------------------------------------------------------------------------------------------

                      Five-Year Outlay Projections

    In compliance with section 308(a)(1)(B) of the 
Congressional Budget and Impoundment Control Act of 1974 
(Public Law 93-344), as amended, the following table contains 
five-year projections, in millions of dollars, associated with 
the budget authority provided in the accompanying bill:




Fiscal year 2004......................................            $6,422
Fiscal year 2005......................................             5,950
Fiscal year 2006......................................             2,313
Fiscal year 2007......................................             1,293
Fiscal year 2008 and future years.....................             1,046


         Statement of General Performance Goals and Objectives

    Pursuant to clause 3(c)(4) of rule XIII of the Rules of the 
House of Representatives, the following is a statement of 
general performance goals and objectives for which this measure 
authorizes funding:
    The Committee on Appropriations considers program 
performance, including a program's success in developing and 
attaining outcome-related goals and objectives, in developing 
funding recommendations.

               Assistance to State and Local Governments

    In accordance with section 308(a)(1)(C) of the 
Congressional Budget and Impoundment Control Act of 1974 
(Public Law 93-344), as amended, the financing assistance to 
State and local governments is as follows:
    The amounts recommended in the accompanying bill contain no 
budget authority or budget outlays for State or local 
governments.

          Compliance With Rule XIII, Cl. 3(e) (Ramseyer Rule)

    In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

              Chapter 9--International Disaster Assistance

    Sec. 491. Policy and General Authority--(a) The Congress, 
recognizing that prompt United States assistance to alleviate 
human suffering caused by natural and manmade disasters is an 
important expression of the humanitarian concern and tradition 
of the people of the United States, affirms the willingness of 
the United States to provide [assistance for the relief and 
rehabilitation of] relief, rehabilitation, and reconstruction 
assistance for people and countries affected by such disaster.
    (b) Subject to the limitations in section 492, and 
notwithstanding any other provision of this or any other Act, 
the President is authorized to furnish assistance to any 
foreign country, international organization, or private 
voluntary organization, on such terms and conditions as he may 
determine, for international disaster [relief and 
rehabilitation] relief, rehabilitation, and reconstruction, 
including assistance relating to disaster preparedness, and to 
the prediction of, and contingency planning for, natural 
disasters abroad.
    (c) In carrying out the provisions of this section the 
President shall insure that the assistance provided by the 
United States shall, to the greatest extent possible, reach 
those most in need of [relief and rehabilitation] relief, 
rehabilitation, and reconstruction assistance as a result of 
natural and manmade disasters.

                          Full Committee Votes

    Pursuant to the provisions of clause 3(b) of rule XIII of 
the House of Representatives, the results of each rollcall vote 
on an amendment or on the motion to report, together with the 
names of those voting for and those voting against, are printed 
below:
                             ROLLCALL NO. 1

    Date: July 16, 2003.
    Measure: Foreign Operaions, Export Financing, and Related 
Programs, FY 2004.
    Motion by: Mrs. Lowey.
    Description of Motion: To provied $1,000,000,000 for 
``Children Survival and Health Programs Fund'' for HIV/AIDS 
programs, and to designate the entire amount as an emergency 
requirement.
    Results: Rejected 28 yeas to 33 nays.
        Members Voting Yea
Mr. Berry
Mr. Bishop
Mr. Clyburn
Mr. Cramer
Mr. DeLauro
Mr. Dicks
Mr. Edwards
Mr. Farr
Mr. Fattah
Mr. Hinchey
Mr. Hoyer
Mr. Jackson
Mr. Kaptur
Mr. Kennedy
Mr. Kilpatrick
Mr. LaHood
Mr. Lowey
Mr. Mollohan
Mr. Moran
Mr. Obey
Mr. Olver
Mr. Pastor
Mr. Price
Mr. Rothman
Ms. Roybal-Allard
Mr. Sabo
Mr. Serrano
Mr. Visclosky                         Members Voting Nay
                                    Mr. Aderholt
                                    Mr. Bonilla
                                    Mr. Boyd
                                    Mr. Crenshaw
                                    Mr. Culberson
                                    Mr. Cunningham
                                    Mr. Doolittle
                                    Mr. Emerson
                                    Mr. Frelinghuysen
                                    Mr. Goode
                                    Mr. Granger
                                    Mr. Hobson
                                    Mr. Istook
                                    Mr. Kingston
                                    Mr. Kirk
                                    Mr. Knollenberg
                                    Mr. Kolbe
                                    Mr. Latham
                                    Mr. Lewis
                                    Mr. Nethercutt
                                    Mr. Peterson
                                    Mr. Regula
                                    Mr. Rogers
                                    Mr. Sherwood
                                    Mr. Simpson
                                    Mr. Taylor
                                    Mr. TIahrt
                                    Mr. Vitter
                                    Mr. Wamp
                                    Mr. Weldon
                                    Mr. Wicker
                                    Mr. Wolf
                                    Mr. Young
                             ROLLCALL NO. 2

    Date: July 16, 2003.
    Measure: Foreign Operations, Export Financing and Related 
Programs, FY 2004.
    Motion by: Ms. Kilpatrick.
    Description of Motion: To provide $500,000,000 for ``Child 
Survival and Health Programs Fund'' for HIV/AIDS programs, and 
to reduce ``Millennium Challenge Account'' by the same amount.
    Results: Rejected 27 yeas to 28 nays.
        Members Voting Yea
Mr. Berry
Mr. Bishop
Mr. Boyd
Mr. Clyburn
Mr. DeLauro
Mr. Dicks
Mr. Edwards
Mr. Emerson
Mr. Farr
Mr. Fattah
Mr. Hinchey
Mr. Jackson
Mr. Kaptur
Mr. Kilpatrick
Mr. LaHood
Mr. Lowey
Mr. Mollohan
Mr. Moran
Mr. Obey
Mr. Lover
Mr. Pastor
Mr. Price
Mr. Rothman
Ms. Rybal-Allard
Mr. Sabo
Mr. Serrano
Mr. Visclosky                         Members Voting Nay
                                    Mr. Aderholt
                                    Mr. Bonilla
                                    Mr. Crenshaw
                                    Mr. Culberson
                                    Mr. Cunningham
                                    Mr. Frelinghuysen
                                    Ms. Granger
                                    Mr. Hobson
                                    Mr. Istook
                                    Mr. Kirk
                                    Mr. Knollenberg
                                    Mr. Kolbe
                                    Mr. Latham
                                    Mr. Lewis
                                    Mr. Nethercutt
                                    Mr. Peterson
                                    Mr. Regula
                                    Mr. Rogers
                                    Mr. Sherwood
                                    Mr. Simpson
                                    Mr. Taylor
                                    Mr. TIahrt
                                    Mr. Vitter
                                    Mr. Wamp
                                    Mr. Weldon
                                    Mr. Wicker
                                    Mr. Wolf
                                    Mr. Young
                                    
                                    
                 ADDITIONAL VIEWS OF HON. NITA M. LOWEY

    The total amount recommended in this bill of $17.1 billion 
is far below the fiscal year 2003 spending level of $23 billion 
for foreign operations, and is $1.7 billion below the 
President's fiscal year 2004 request.
    While I am in general agreement with the spending levels 
recommended in this bill within the reduced allocation, 
difficult choices had to be made. The bill at least maintains 
last year's levels for all categories of Child Survival and 
Health, provides an increase in HIV/AIDS and Basic Education 
funding, and funds reconstruction in Afghanistan. The bill also 
fully funds our commitments in the Middle East, a powerful 
statement at such a critical time in the peace process.
    However, at the $17.1 billion spending level, we, as a 
country, will devote less than 1 percent of our GDP to foreign 
assistance. The supplemental spending for war-related needs in 
Iraq and Afghanistan which brought the fiscal year 2003 total 
to $23 billion sailed through Congress without controversy 
because it was judged vital to our national security. I 
anticipate we may be in a similar situation in the upcoming 
year, as the need for Iraq reconstruction funds become 
increasingly clear.
    In comparison, additional resources for Africa have 
traditionally been much more difficult to come by. Everyone is 
aware of the long history of devastating and destabilizing 
humanitarian and political crises on that continent. Although 
this bill will slightly increase resources for Africa above 
last year, it merely begins to address the ongoing tragedies 
there.
    The sad fact is that we, as a nation, have neglected the 
problems of Africa for decades. Chronic poverty, spread of 
infectious disease, and lack of good governance remain, despite 
the efforts we have undertaken so far across many Congresses 
and Administrations. We must no longer shy away from addressing 
these problems with sufficient resources and political will. 
Current Presidential initiatives are being touted as ultimate 
answers for these tragedies, but while these initiatives have 
the promise of getting increased resources to Africa, the 
actual effects they will have remain unclear.
    The bill contains $800 million for the first year of 
funding for the Millennium Challenge Account (MCA). While this 
initiative has been portrayed as helpful to Africa, I believe 
the jury is still out. According to the best information 
currently available, only three of eleven potentially 
qualifying countries for MCA resources are in Africa (Ghana, 
Lesotho, and Senegal). In 2005, of the twelve countries most 
likely to qualify, again, only three are in Africa (Senegal, 
Lesotho, and Swaziland). If these projections are indeed true, 
the MCA will help, but it will not save, Africa.
    With respect to HIV/AIDS, this bill contains $1.27 billion, 
or $30 million above the President's request. Taken together 
with funds included in the Labor, Health and Human Services 
bill, the House has approved a total of $2.074 billion for HIV/
AIDS for 2004. This is $35 million above the President's 
request for 2004.
    The enactment of legislation endorsing the President's $15 
billion/five-year plan, and authorizing $3 billion for HIV/AIDS 
and infectious disease programs in 2004 has created the strong 
expectation that $3 billion in HIV funding will be funding will 
be forthcoming. While in Africa recently, the President and the 
National Security Advisor publicly endorsed the $3 billion 
spending level of 2004, and strongly implied that it was 
Congress that was reluctant to provide the $3 billion level.
    Unfortunately, the amendment I offered in Full Committee on 
the bill to provide the additional $1 billion for HIV/AIDS 
failed. It was explicitly opposed by the White House. Similar 
amendments to move funding within the bill to HIV/AIDS from 
other accounts also failed. More funding for HIV/AIDS programs 
can be used effectively in 2004. The most recent United Nations 
report on HIV/AIDS cites the need for $8.3 billion for HIV/AIDS 
programs next year, while estimating that only $5.3 billion 
will be provided by all donors combined, leaving a gap of $3 
billion. There are still large areas in many countries inAfrica 
where condom distribution, access to HIV testing, and education 
programs are simply not available. More resources are necessary and our 
capacity to plan and deliver programs can, and must, be expended.
    Additional HIV/AIDS funds will enable:
          speeding expansion of Mother-to-Child transmission 
        programs;
          accelerating the creation of viable treatment 
        programs;
          establishing drug purchase and distribution programs;
          expanding of the number of countries in the 
        President's initiative beyond the 14 countries 
        currently identified;
          expanding prevention programs.
    The bill also contains $350 million for basic education, 
which is $100 million above last year. In addition, it requires 
an extensive report detailing precisely how the Administration 
will organize itself to truly expand our basic education 
efforts. Unfortunately, at the moment, there is no strategic 
focus to our education programs. They are scattered throughout 
the world, administered by a myriad of agencies and bureaus, 
and are severely underfunded. The President's 2004 request 
would have actually cut basic education programs. There is a 
strong bipartisan consensus that providing more, and more 
focused, resources for basic education throughout the world is 
one of the best possible ways in which foreign aid can combat 
the extremism and hopelessness that breed terrorism. I am 
pleased that we have made strong statement in this regard, and 
I thank Chairman Kolbe for his leadership on this issue.
    The bill also provides increased resources for Treasury 
Technical Assistance to help countries that are major source 
and transit points for terrorist financing close the gaping 
holes in their financial systems that let this funding slip 
through.
    The decision to fund the Millennium Challenge Account at 
$800 million, combined with the requirement to cut $1.769 
billion from the President's request to meet our 302(b) 
allocation, has resolved in several program cuts. There is no 
funding recommended for debt relief for the Democratic Republic 
of Congo. Cuts in Economic Support Funds, Eastern Europe, the 
New Independent States, and Development Assistance translate 
into probable cuts to Turkey, Pakistan and Africa, and a 
limited capacity to restore misguided cuts proposed by the 
Administration to Armenia, Cyprus, East Timor, Ireland, Russia, 
Ukraine, Central Asia, Kosovo, and Bosnia.
    While I am supportive of the concept embodied in the 
proposal to establish the Millennium Challenge Account, I am 
concerned that budget realities that we will face this year and 
next put into jeopardy the promise made by the President--that 
the $10 billion total intended for this initiative be additive 
to current levels of foreign assistance. Much of the bipartisan 
support in Congress for this initiative stems from the fact 
that it is supposed to help the poorest countries of the world, 
particularly in Africa, and that the resources for it will add 
to amounts currently spent on foreign assistance. Cuts to 
discretionary spending in this year's Budget Resolution, 
combined with unrealistic budget requests for Homeland 
Security, Education and other domestic programs, have 
translated into cuts in the allocation for foreign assistance. 
This situation is likely to worsen in fiscal year 2005. The 
President cannot expect Congress to support full funding of the 
MCA initiative going forward if other, ongoing programs in the 
Foreign Operations bill have to be cut.
    I have always viewed foreign assistance as one of the three 
pillars of national security, along with defense and diplomacy. 
I believe the value of foreign assistance in spreading the 
ideals of democracy and freedom around the world and in 
eliminating the poverty that causes widespread in instability 
in developing regions cannot be underestimated. However, except 
for a handful of notable instances directly linked to front-
page current events, it has been difficult to ensure adequate 
funding for foreign aid priorities. Despite the initiation in 
the fiscal year 2004 bill of new Presidential initiatives, this 
year is no different. We still require far more resources than 
have been made available, and I look forward to working with my 
colleagues in future years to ensure our priorities are 
adequately funded.
                                                         Nita Lowey