Interior, Environment, and Related Agencies: FY2012 Appropriations

Carol Hardy Vincent, Coordinator
Specialist in Natural Resources Policy

The Interior, Environment, and Related Agencies appropriations bill includes funding for the Department of the Interior (DOI), except for the Bureau of Reclamation, and for agencies within other departments—including the Forest Service within the Department of Agriculture and the Indian Health Service (IHS) within the Department of Health and Human Services. It also includes funding for arts and cultural agencies, the U.S. Environmental Protection Agency, and numerous other entities.

On July 19, 2011, the House Appropriations Committee reported H.R. 2584 (H.Rept. 112-151) with $27.52 billion in appropriations for FY2012 for Interior, Environment, and Related Agencies. If enacted, this would be a $2.09 billion (7.1%) reduction from the FY2011 appropriation of $29.61 billion and $3.82 billion (12.2%) less than the Administration’s FY2012 request of $31.34 billion. While the Administration had primarily proposed increases over FY2011 for major agencies funded by the bill, the House committee proposed few such increases. One notable increase in the House committee bill was $392.4 million (10%) for the Indian Health Service.

While most agencies would be reduced from the FY2011 levels in the House committee bill, the amount of reduction varied. Among the decreases recommended by the committee were the following: 

•         $1.53 billion (18%) for the Environmental Protection Agency, 

•         $310.6 million (21%) for the Fish and Wildlife Service, 

•         $172.1 million (4%) for the Forest Service, and 

•         $131.7 million (5%) for the National Park Service.

From July 25, 2011, to July 28, 2011, the House considered H.R. 2584 but came to no resolution. No bill to fund Interior, Environment, and Related Agencies for FY2012 has been introduced in the Senate. However, on October 14, 2011, the Senate Appropriations Subcommittee on Interior, Environment, and Related Agencies released a draft bill for FY2012. Because no regular appropriations bill was enacted before the October 1, 2011, start of the fiscal year, agencies and activities in the bill are being funded through a continuing appropriations resolution (P.L. 112-36) providing appropriations at the FY2011 level, minus 1.503%, under the authority and conditions in the FY2011 appropriations law (P.L. 112-10). Continuing appropriations for FY2012 are to be provided through November 18, 2011, unless a regular appropriations bill is enacted sooner.

Congress typically debates a variety of funding and policy issues when considering each year’s appropriations legislation. These issues have included regulatory actions of the Environmental Protection Agency, energy development onshore and offshore, wildland fire fighting, royalty relief, Indian trust fund management, climate change, DOI science programs, endangered species, wild horse and burro management, and agency reorganizations. Other issues have included appropriate funding levels for Bureau of Indian Affairs law enforcement and education; Indian Health Service construction and contract health services; wastewater/drinking water needs; the arts; land acquisition through the Land and Water Conservation Fund; and the Superfund program.


Date of Report: October 17, 2011
Number of Pages: 72
Order Number: R41896
Price: $29.95

Follow us on TWITTER at http://www.twitter.com/alertsPHP or #CRSreports

Document available via e-mail as a pdf file or in paper form.
To order, e-mail Penny Hill Press or call us at 301-253-0881. Provide a Visa, MasterCard, American Express, or Discover card number, expiration date, and name on the card. Indicate whether you want e-mail or postal delivery. Phone orders are preferred and receive priority processing.

Legislative Branch: FY2012 Appropriations

Ida A. Brudnick
Analyst on the Congress

The legislative branch appropriations bill provides funding for the Senate; House of Representatives; Joint Items; Capitol Police; Office of Compliance; Congressional Budget Office; Architect of the Capitol; Library of Congress, including the Congressional Research Service; Government Printing Office; Government Accountability Office; and Open World.

The legislative branch budget request of $4.857 billion, which is included in the President’s budget, was submitted on February 14, 2011. This represents an approximately 7% increase over funds provided for FY2011, although the request was submitted prior to the enactment of the FY2011 appropriations act. The FY2011 act (P.L. 112-10, enacted on April 11, 2011) provided $4.54 billion for legislative branch activities, which represented a decrease of nearly 3% from the $4.66 billion provided for FY2010.

The House Appropriations Committee Subcommittee on the Legislative Branch held a markup on July 7, 2011, which was followed by a full committee markup on July 13. The full committee ordered reported a $3.3 billion bill, H.R. 2551 (H.Rept. 112-148). This total represents a $227 million, or 6.4%, reduction from the FY2011 level. The House agreed to a rule for consideration of the bill (H.Res. 359) on July 21, 2011. The House passed the bill, as amended, on July 22 (Roll no. 629; 252-159).

The Senate Appropriations Committee, by a vote of 28-2, ordered H.R. 2551 reported with amendments on September 15, 2011.

The Subcommittees on the Legislative Branch of the House and Senate Appropriations Committees both held hearings during which Members considered the FY2011 legislative branch requests. Among issues that were considered during hearings were the following: 

•          the potential for flat or reduced funding levels, including the effect on agency operations, plans for various budget scenarios, and potential efficiencies; 

•          security plans and costs, especially for Members and district offices; 

•          expenses for legal services related to the Defense of Marriage Act following Attorney General Eric Holder’s February 23, 2011, letter to Speaker John Boehner regarding the President’s determination that Section 3 of this act is unconstitutional and the Speaker’s March 9, 2011, announcement that the House General Counsel was directed to initiate a legal defense of this law; 

•          the role of the Government Printing Office in the digital age; and 

•          status of current Architect of the Capitol projects and timing of renovations. 

Previously, P.L. 111-68 (enacted October 1, 2009) provided $4.656 billion for FY2010. The FY2010 Supplemental Appropriations Act (P.L. 111-212) provided an additional $12.96 million for the Capitol Police. The FY2009 Omnibus Appropriations Act (P.L. 111-8, enacted on March 11, 2009) provided $4.4 billion for the legislative branch. In FY2009, the American Recovery and Reinvestment Act of 2009 (P.L. 111-5) provided an additional $25 million for the Government Accountability Office, and the FY2009 Supplemental Appropriations Act (P.L. 111-32) provided $71.6 million for the Capitol Police and $2 million for the Congressional Budget Office.


Date of Report: October 21, 2011
Number of Pages: 30
Order Number: R41870
Price: $29.95

Follow us on TWITTER at http://www.twitter.com/alertsPHP or #CRSreports

Document available via e-mail as a pdf file or in paper form.
To order, e-mail Penny Hill Press or call us at 301-253-0881. Provide a Visa, MasterCard, American Express, or Discover card number, expiration date, and name on the card. Indicate whether you want e-mail or postal delivery. Phone orders are preferred and receive priority processing.

Federal Employees’ Retirement System: Budget and Trust Fund Issues

Katelin P. Isaacs
Analyst in Income Security

Retirement annuities for civilian federal employees are provided mainly through two programs: the Civil Service Retirement System (CSRS) and the Federal Employees’ Retirement System (FERS). Under both of these systems, retirement annuities are financed through a combination of employee and employer contributions to the Civil Service Retirement and Disability Fund (CSRDF). All assets of the CSRDF are invested in U.S. Treasury bonds and other securities backed by the full faith and credit of the U.S. government. Retirement annuities for federal employees are paid from the CSRDF regardless of whether the benefits were accrued under CSRS or FERS.

FERS annuities are fully funded by the sum of employee and employer contributions and interest earned by the Treasury bonds held by the CSRDF. The federal government makes supplemental payments into the CSRDF on behalf of employees covered by the CSRS because employee and agency contributions and interest earnings do not meet the full cost of the benefits earned by employees covered by that system.

The Office of Personnel Management (OPM) estimates that in FY2011, expenditures from the CSRDF will total $71.7 billion, of which $71.5 billion will represent annuity payments to retirees and survivors. Other outlays consist of refunds, payments to estates, and administrative expenses. Outlays from the fund are projected to increase by 3.5% to $74.2 billion in 2012, of which $74.1 billion will represent annuity payments. OPM estimates that income to the CSRDF from all sources will be $95.3 billion in 2011 and $95.2 billion in 2012. The year-end balance of the CSRDF is projected to increase from $797.0 billion at the end of 2011 to $817.1 billion at the end of 2012.

OPM estimates that the annual income of the CSRDF will increase from $105.0 billion in 2011 to $163.8 billion in 2025 and to about $1.0 trillion in 2080. The total expenses of the fund are projected to rise more slowly, increasing from $72.3 billion in 2011 to $122.0 billion in 2025 and to $590.6 billion in 2080. Consequently, the assets held by the CSRDF also are projected to increase steadily, rising from $823.8 billion in 2011 to more than $1.3 trillion in 2025 and to $11.7 trillion in 2080. Expenditures from the CSRDF currently are about 38% as large as federal expenditures for the salaries and wages paid to federal employees. Pension expenditures are projected to decline relative to the government’s wage and salary expenses, beginning around 2020. By 2080, the expenditures of the CSRDF are estimated to be only about 23% as large as the government’s expenditures for wage and salary payments to employees.

Because CSRS retirement benefits have never been fully funded by employer and employee contributions, the Civil Service Retirement and Disability Fund has an unfunded liability. The unfunded liability was $673.1 billion in FY2009. According to actuarial estimates, the unfunded liability of the CSRDF will continue to rise until about 2023, when it will peak at $748.9 billion. From that point onward, the unfunded liability will steadily decline and is projected to turn into a surplus of $482.7 billion by 2085. Actuarial estimates indicate that the unfunded liability of the CSRS does not pose a threat to the solvency of the trust fund. In its annual report, OPM has stated that “the total assets of the CSRDF, including both CSRS and FERS, continue to grow throughout the term of the projection, and ultimately reach a level of over 4.5 times payroll, or nearly 20 times the level of annual benefit outlays” in 2080. Unlike the Social Security trust fund, there is no point over the next 70 years at which the assets of the Civil Service Retirement and Disability Fund are projected to run out.


Date of Report: October 20, 2011
Number of Pages: 18
Order Number: RL30023
Price: $29.95

Follow us on TWITTER at http://www.twitter.com/alertsPHP or #CRSreports

Document available via e-mail as a pdf file or in paper form.
To order, e-mail Penny Hill Press or call us at 301-253-0881. Provide a Visa, MasterCard, American Express, or Discover card number, expiration date, and name on the card. Indicate whether you want e-mail or postal delivery. Phone orders are preferred and receive priority processing.

Legal Services Corporation: Background and Funding

Carmen Solomon-Fears
Specialist in Social Policy

The Legal Services Corporation (LSC) is a private, nonprofit, federally funded corporation that helps provide legal assistance to low-income people in civil (i.e., noncriminal) matters. The primary responsibility of the LSC is to manage and oversee the congressionally appropriated federal funds that it distributes in the form of grants to local legal services providers, which in turn give legal assistance to low-income clients in all 50 states, the District of Columbia, the U.S. territories of Guam and the Virgin Islands, the Commonwealth of Puerto Rico, and Micronesia (including the Commonwealth of the Northern Mariana Islands, the Republic of the Marshall Islands, and Palau).

Although the authorization of appropriations for the LSC expired at the end of FY1980, the LSC has operated for the past 31 years under annual appropriations laws. On April 14, 2011, the House and Senate passed H.R. 1473 (the Department of Defense and Full-Year Continuing Appropriations Act, 2011). President Obama signed H.R. 1473 into law (P.L. 112-10) on April 15, 2011. P.L. 112-10 funds the LSC at $404.2 million for FY2011. Moreover, since FY1996, all of the LSC appropriations laws have included language stipulating the provisions restricting the activities of LSC grantees enacted in previous LSC appropriations laws. P.L. 112-10 continues existing limitations on the use of LSC funds (and non-LSC funds) except for the restriction on the ability of LSC-funded programs to collect attorneys’ fees.

For FY2012, the Obama Administration requested $450.0 million for the LSC; 11.3% more than the FY2011 LSC appropriation of $404.2 million. On July 20, 2011, the House Committee on Appropriations recommended $300 million for the LSC for FY2012 (H.Rept. 112-169; H.R. 2596); 25.8% less than the FY2011-enacted amount. On September 15, 2011, the Senate Committee on Appropriations recommended $396.1 million for the LSC for FY2012 (S.Rept. 112-78; S. 1572); 2.0% less than the FY2011-enacted amount. All of the measures included language to eliminate one or more of the restrictions on the use of LSC and/or non-LSC funds.

The LSC statute requires that poverty population data from the most recent decennial census be used to distribute LSC funds. Due to changes in the data sets obtained by the 2010 decennial census, information needed by the LSC is no longer available. On September 19, 2011, the LSC Board recommended several changes to resolve the issue and improve distribution of LSC funds.

Under the LSC’s competitive process, legal services providers in every jurisdiction bid to become the LSC grantee for a designated service area in a state. During 2010, the LSC funded 136 local programs/grantees in 919 offices employing 4,350 attorneys. Local programs establish their own eligibility criteria, in which clients served may not have income that exceeds 125% of the federal poverty guidelines. In 2010, 71% of LSC clients were females and 29% were males. The majority of LSC clients (85%) were between the ages of 18 and 59, 13% were age 60 or older, and 2% were under the age of 18. Almost 47% of LSC clients were non-Hispanic white, 26% were non- Hispanic black, almost 9% were of other races, and about 19% were Hispanic. In 2010, LSC grantees closed 932,406 cases involving issues primarily related to families (divorce, child support, etc.), housing, consumer finance, income maintenance, and health.

Although the LSC is the largest single source of funding for the civil legal services system in the United States, it is not the only source of funding. Local legal services programs supplement their LSC grants with funds from a variety of governmental and private sources. LSC funding accounts for 44% of all funding for civil legal services for the poor in the United States.


Date of Report: October 6, 2011
Number of Pages: 19
Order Number: RL34016
Price: $29.95

Follow us on TWITTER at http://www.twitter.com/alertsPHP or #CRSreports

Document available via e-mail as a pdf file or in paper form.
To order, e-mail Penny Hill Press or call us at 301-253-0881. Provide a Visa, MasterCard, American Express, or Discover card number, expiration date, and name on the card. Indicate whether you want e-mail or postal delivery. Phone orders are preferred and receive priority processing.

Ability to Repay, Risk-Retention Standards, and Mortgage Credit Access

Darryl E. Getter
Specialist in Financial Economics

Prior to the recent financial crisis, mortgage underwriting standards were relaxed to the point where many borrowers could only repay their loans if favorable financial conditions that existed at the time of origination remained intact. In other words, borrowers obtained mortgage loans that relied upon interest rates not rising or the value of the underlying collateral (house prices) not declining. When market conditions changed, however, many mortgage loans became delinquent and went into default. The mortgage defaults often translated into large losses for both the borrowers and the financial industry.

After enactment of The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act; P.L. 111-203), the Federal Reserve Board announced a proposed qualified mortgage (QM) rule that would establish “ability to repay” standards for mortgage lending. The Federal Reserve, along with other federal regulatory agencies, also jointly released a proposed risk retention or qualified residential mortgage (QRM) rule to require parties involved in a transaction in which mortgage originations are sold to retain “skin-in-the-game” or a minimum percentage of the credit risk of financial products, which would result in the sharing of any eventual losses. Adoption of ability to repay and risk-retention standards may discourage lenders from excessively relaxing lending standards even during economic boom periods, thus making loan repayment more resilient to sudden shifts in short-term economic and financial conditions.

The ability to repay and risk-retention standards, while designed to curtail the pre-crisis proliferation of risky lending practices, are likely to simultaneously reduce access to mortgage credit. Although ability-to-repay standards would encourage consistent underwriting at all times, some borrowers that benefit from lender flexibility during more favorable macroeconomic conditions are likely to face increased difficulty obtaining mortgage loans. Lenders may be reluctant to originate loans that are not in compliance with the ability-to-repay standards if this exposes them to increased legal risks. Likewise, risk-retention standards that translate into more stringent qualification requirements for borrowers are likely to increase barriers to homeownership for both creditworthy and disadvantaged borrowers.

The 112th Congress is overseeing the rulemaking stemming from the Dodd-Frank Act. This report examines the developments associated with the implementation of mortgage lending reforms. After summarizing the proposed ability to repay and risk-retention standards, a description of risky underwriting practices that occurred prior to the mortgage crisis is presented, followed by a discussion of possible effects on mortgage credit accessibility.


Date of Report: October 20, 2011
Number of Pages: 18
Order Number: R42056
Price: $29.95

Follow us on TWITTER at http://www.twitter.com/alertsPHP or #CRSreports

Document available via e-mail as a pdf file or in paper form.
To order, e-mail Penny Hill Press or call us at 301-253-0881. Provide a Visa, MasterCard, American Express, or Discover card number, expiration date, and name on the card. Indicate whether you want e-mail or postal delivery. Phone orders are preferred and receive priority processing.