The Federal Budget

2006 Budget Proposal: Agency Breakdown

Monday, February 7, 2005

President Bush today unveiled a $2.57 trillion budget that eliminates dozens of politically sensitive domestic programs, including funding for education, environmental protection and business development, while proposing significant increases for the military and international spending.

Overall, discretionary spending other than defense and homeland security would fall by nearly 1 percent, the first time in many years that funding for the major part of the budget controlled by Congress would actually go down in real terms. The cuts are scattered across a wide swath of the government, affecting a cross-section of constituents, from migrant workers to train passengers to local police departments.

Below are agency-by-agency breakdowns of the president's proposal that will affect individual federal departments and agencies. Additional agency breakdowns will be added throughout the day as they become available.

Department of Agriculture

Department of Agriculture logo The administration proposes to limit government payments to individual farmers to $250,000, reduce crop and dairy payments by 5 percent, impose a new assessment on sugar growers, and eliminate several loopholes that have allowed farmers to evade caps on subsidies.

"There was a consensus that the deficit had to be dealt with," said Agriculture Secretary Mike Johanns today, as he unveiled some of the most sweeping cuts in farm subsidies in recent memory.

Officials said new legislation would be required for some steps but that the administration could act on its own to block further payments to individuals deemed not to be "actively engaged" in farming. That step alone could strike hundreds from the farm payment rolls.

To end a series of costly congressional bailouts resulting from crop failures, floods and droughts, the administration will seek to make all federally subsidized farmers purchase enough private insurance to cover at least half their losses. The plan would shift farming risks to the private sector and away from taxpayers, who have paid $10 billion in "emergency" payments to the farm sector since 2000.

USDA agencies involved in combating bioterrorism, developing a vaccine bank, and protecting the food system fare well in the new plan, and the popular Conservation Reserve Program would be financed at about this year's level.

But overall, the department's discretionary budget authority would be trimmed by about $2 billion, and would be 9.6 percent less than fiscal 2005's $21.4 billion, with cuts spread between research, marketing, land acquisition, watershed protection and other accounts.

The plan brought a rebuke from Sen. Tom Harkin (D-Iowa), ranking Democrat on the Senate Agriculture Committee. "If acted on by Congress, the president's budget numbers will take away funds promised for farm, rural development, conservation, renewable energy, nutrition and other critical needs," he said.

--Dan Morgan

Department of Commerce

Department of Commerce logo The Commerce Department budget would soar 49 percent under Bush's budget, to $9.4 billion in budget authority. But that is because Commerce would gain control over a host of economic development programs that were previously run by other departments -- and which would undergo cuts in funding of about one-third.

These programs, the biggest of which is HUD's Community Development Block Grants, got about $5.7 billion in funding for 2005. Under Bush's fiscal 2006 budget, they would be folded into the new "Strengthening America's Communities Grant Program" and funded at $3.7 billion.

Many of Commerce's traditional programs would undergo major cuts. The National Oceanic and Atmospheric Administration, which got a substantial increase last year, would be cut 8 percent, to $3.584 billion. As in previous budgets, the president is proposing to eliminate the Advanced Technology Program, a Clinton administration favorite that helps fund promising technology ventures.

Bush is again proposing a deep reduction in the Manufacturing Extension Partnership program, which provides training and advice to manufacturers and their employees. The program would be funded at $47 million, 60 percent below the 2005 level.

--Paul Blustein

Department of Defense

Department of Defense logo

The fiscal 2006 defense budget of $419.3 billion represents a 4.8 percent increase over fiscal 2005 in real terms, but is about $3 billion less than projected for fiscal 2006 in last year's plan.

This budget does not include an expected administration request for $80 billion in supplemental appropriations, including $75 billion for the Defense Department to cover the cost of military operations in Iraq and Afghanistan in the current fiscal year.

Highlights of the spending include $108.94 billion for military personnel, including funding for a 3.1 percent pay raise and additional recruiting and retention bonuses for troops. That funding would include $4.1 billion for Special Operations forces -- boosting their numbers by 1,400 and increasing spending for language training -- underscoring the request's assessment that the forces have "contributed significantly" to the war on terror. The budget also allocates $416 million to start the repatriation of 70,000 military personnel from overseas bases.

In terms of weapons systems, procurement funding declined about 2 percent to $78 billion. Funding was stepped up for some systems considered important to the military's goal of modernizing: The Army's Future Combat System receives $3.4 billion, an increase of $200 million; and the Navy's Littoral Combat Ship gained an increase of $156 million to $613 million.

But the budget would cut funding for such weapons systems as the F/A-22 fighters, DD(X) destroyers, LPD amphibious ships, Virginia-class attack submarines and V-22 tilt-rotor aircraft.

--Ann Scott Tyson

Department of Education

Department of Education logo The administration is requesting $56 billion for the Department of Education, a reduction of a half billion dollars, or 0.9 percent, from the current spending plan -- which would be the first cut in overall federal education spending in a decade.

The budget would eliminate the Perkins loan program, which provides low-interest loans to low- and middle-income college students. The budget also would end Perkins loan forgiveness for members of the armed services and Peace Corps volunteers. The budget would redirect those savings to increase spending on Pell Grants, which provide college grants to low-income students and raise the maximum award $100 to $4,150 -- the first of five annual Pell increases planned by the White House.

In all, 48 education programs would be terminated, including those providing college-readiness training to low-income high school students and federal vocational education initiatives that the White House said are not performing well or duplicate other federal efforts.

Some of the savings would be used to increase spending in several programs, including $1.5 billion to extend federal No Child Left Behind testing and accountability requirements into the nation's high schools. The federal Title I program for poor children would increase by 4.7 percent, or $603 million, to $13.3 billion, and funding for disabled students would increase $508 million to $11.1 billion.

--Michael A. Fletcher

Department of Energy

Department of Energy logo The Energy Department's budget would fall 2 percent to $23.4 billion.

Under the administration's proposal, funding would be reduced in a number of areas, including for cleanup at the Hanford site in Washington state, which was used for plutonium production. Energy Department officials said cleanup is winding down and that less money needed to be spent.

Also cut would be funds given to oil and gas companies to study more efficient drilling techniques. Officials said the companies could afford to fund such research on their own.

More money would be spent on Yucca Mountain in Nevada, a site where the administration wants to create a repository to store nuclear waste. Other areas that would receive more funding include research into the use of hydrogen and nuclear non-proliferation efforts.

In a budget presentation today, President Bush's new energy secretary, Samuel Bodman, said the budget "required a lot of tough decisions and a lot of tradeoffs."

--Justin Blum

Environmental Protection Agency

Environmental Protection Agency logo President Bush is requesting a cut of half a billion dollars for the Environmental Protection Agency, a reduction of 5.6 percent, for a total of $7.6 billion. Environmentalists warned that the cuts would gut valuable programs, while administration officials said that the cuts would not harm the environment or the public health.

The budget calls for a $79 million increase in EPA's homeland security programs, including a project to monitor contamination in select cities, said acting administrator Steve Johnson. It also provides $47 million in additional funding to clean up and restore contaminated and abandoned sites.

Cuts include $170 million for water quality protection programs and about $115 million for land preservation and restoration. Among the targeted programs is a loan program to help states build sewage and water treatment plants, said Wesley Warren, deputy director for advocacy at the Natural Resources Defense Council, an environmental advocacy group.

But Johnson and James Connaughton, chairman of the White House Council on Environmental Quality, said many cuts merely removed congressional "earmarks" -- spending proposals not backed by the administration. Some successful programs also needed less money, they said, while other unsuccessful programs were being cut.

--Shankar Vedantam

Federal Drug Administration

The Bush administration proposed Monday a 24 percent increase in funding for the Food and Drug Administration office that monitors the safety of drugs after they hit the market, budget documents said.

The proposal follows charges that the FDA pays too little attention to serious side effects linked to drugs after they have won approval.

The additional money for the FDA's Office of Drug Safety was part of the administration's proposed budget for fiscal year 2006, which starts Oct. 1. The White House sent the plan to Congress, and lawmakers will set the final spending levels in the coming months.

The drug safety office came under scrutiny last year when a veteran scientist in the office said his FDA supervisors ignored or downplayed his warnings about risks of Merck & Co. Inc.'s arthritis drug Vioxx. The company pulled the drug from the market in September after a study linked it to a higher risk of heart attack and stroke.

Several lawmakers, including some top Republicans, have voiced support for strengthening the drug safety office and making it more independent from the part of FDA that reviews medicines before they win approval.

--Reuters

Department of Health & Human Services

Department of Health and Human Services logo Under the Bush budget, spending by the Department of Health and Human Services would rise by $58 billion to $642 billion in fiscal 2006. The HHS discretionary budget authority would decline by $300 million to $68.9 billion.

Most of the HHS budget is consumed by mandatory programs, particularly Medicaid and Medicare, which serve the elderly, disabled and the poor. Administration officials now project the Medicare prescription drug benefit will cost $395 billion during the first five years, or nearly double the original estimate of $400 billion over a decade.

The Centers for Disease Control and Prevention, the world's premier public health agency, would be hit the hardest with about $500 million being cut from last year's $4.5 billion budget. CDC would slash preventive health grants and bioterrorism preparedness grants to state and local health departments.

Medicaid spending would be cut $45 billion over the next decade. Officials say most of that would come from negotiating lower drug prices, cracking down on fraud and caring for the elderly in their own homes rather than more costly nursing homes.

The National Institutes of Health, which last year completed a five-year doubling of its budget, would receive $196 million, or 0.7 percent, over last year. The budget includes more money for biodefense and a new chemical countermeasures project.

For the Food and Drug Administration, the administration proposed a $1.9 billion budget -- $1.5 billion in federal funds and $382 million in industry user fees. The FDA budget is a 4.5 percent increase over 2005. Much of the increase would be in the FDA's counterterrorism program, but there also is more money for the safety surveillance program for drugs already on the market.

Numerous popular projects at HHS, including the Ryan White CARE Act, the Administration on Aging, the Office of the Inspector General and the Agency for Healthcare Research and Quality are funded at the same amount as last year. Advocates say that with costs rising, level funding amounts to a reduction. But given the deficit, "flat funding this year is a pretty good deal," said Kerry Weems, HHS acting assistant secretary.

--Ceci Connolly

Department of Homeland Security

Department of Homeland Security logo

The Department of Homeland Security is proposing a budget of $29.3 billion for fiscal 2006, an increase of $258 million, or 1 percent. Including $4.8 billion in existing and new fees, its discretionary budget is $34 billion, a 6.8 percent increase. Including funds spent by other federal departments, the government is spending $49.9 billion on domestic defense, an increase of $3.9 billion, or 8.6 percent, from this year.

The Immigration and Customs Enforcement unit, which has had massive financial shortfalls, would receive an increase of $490 million, or 13 percent.

Homeland Security also proposes spending an extra $90 million for new detention facilities for illegal immigrants after it had to release thousands of them because of inadequate bed space. The department plans to spend $36 million more on the Border Patrol, mostly to hire 210 new agents along the nation's borders -- a fraction of the 2,000 Congress said last year should be hired.

--John Mintz

Department of Housing & Urban Development

Department of Housing & Urban Development logo The Department of Housing and Urban Development's budget would shrink by about $3.7 billion, or 11.5 percent, for a total of $28.5 billion. Much of those cuts would come from a reorganization plan that would send the agency's multibillion-dollar community development programs to the Commerce Department.

The administration's proposal, which must by approved by Congress, would also cut a number of other programs that provide housing assistance to low-income Americans. It would cut housing aid for the disabled by $118 million, or almost half. It would also cut funding for housing assistance programs for those with AIDS, for Native Americans, for programs that pay to rebuild the government's most decrepit public housing and for the agency's lead abatement programs.

Some HUD programs would be expanded. The budget would increase some forms of rental assistance, set aside an additional $200 million for anti-homelessness programs and quadruple funding for programs that help cover down payments for some homebuyers.

--Brian Faler

Department of Interior

Department of Interior logo

The Department of the Interior's budget would shrink to $10.6 billion, a drop of 1.1 percent from fiscal 2005. Funding for the National Park Service, which has one of the largest budgets under Interior, would be cut about $66 million, or nearly 3 percent from fiscal 2005, for a total budget of $2.3 billion.

Budget authority for the Fish and Wildlife Service would be increased about $31 million, or 2 percent, for a total of about $1.3 billion.

Bush proposes to extend the coal fee, which is set to expire in June, and to modify the 1977 Surface Mining Control and Reclamation Act to help pay for health and safety work at abandoned coal mines.

Although $109 million, or nearly 5 percent, was cut from the Bureau of Indian Affairs, other funds were included to help pay for sorting out Interior's troubled handling of Indian trust accounts.

-- Judy Sarasohn

Department of Justice

Department of Justice logo The administration wants to cut Justice Department spending authority by $1.1 billion, or 5.5 percent, for a total budget of $19.1 billion, primarily by slashing popular grants to communities that hire extra police officers or shoulder a financial burden by jailing undocumented aliens. The administration says it is not persuaded that the former program -- begun by the Clinton administration and championed by many Democrats -- has actually cut crime, and says the latter program has misspent its past funds. The Community Oriented Policing Services -- COPS -- program would shrink from $499 million to $22 million.

The Office of Violence Against Women's current budget of $383 million would be cut by $19 million.

Within the overall budget, spending for the FBI would nonetheless grow by $556 million, or 10 percent, to finance the hiring of 500 new intelligence analysts for the war on terrorism, boost the number of FBI translators and improve the effort to watchlist terrorist suspects. The Drug Enforcement Administration would also get an extra $63 million, or 3.8 percent; and total spending for the federal prison system, now at $4.7 billion, would stay roughly flat while construction of three new prisons gets underway.

Some of the new funds would come from a hefty fee to be imposed on the use of imported and domestically produced explosives, which requires legislative approval.

--R. Jeffrey Smith

Department of Labor

Department of Labor logo The Labor Department budget will shrink 4.4 percent, with discretionary budget authority cut to $11.5 billion from $12 billion last year, in an overall $54.5 billion budget.

The four Workforce Investment Act state grant programs would be cut by $61.5 million and would merge into a single $3.9 billion program. The administration wants to eliminate the Migrant and Seasonal Farmworker job-training program, a savings of $76.2 million, and the Responsible Reintegration for Young Offenders program, a $49.6 million savings. The total Employment and Training discretionary budget would decrease by $358.2 million.

The budget calls for $250 million for the second year to fund Bush's Community College Initiative, and the prisoner re-entry initiative will increase by $15.2 million to $35 million.

The YouthBuild program, which trains disadvantaged youth to build affordable housing, was transferred from Housing and Urban Development to Labor and would receive $59.7 million.

The department will receive a $4.2 million increase for the Occupational Safety and Health Administration and the Mine Safety and Health Administration. It will eliminate the Occupational Safety and Health Administration program that trains companies in safety, a savings of $10.2 million. The department says OSHA provides direct outreach in ways other than training grants.

--Amy Joyce

NASA

NASA won a significant 2006 budget increase yesterday to $16.5 billion to fund President Bush's initiative to pursue human exploration of the moon and Mars in 2006, but killed plans to service the Hubble Space Telescope.

The NASA figures are part of a national science and technology budget that is generally flat, and in many respects smaller, than that of the current year. The departments of Energy and Defense, major drivers of federal research, saw research cuts.

"Taken together, the inadequate FY06 investments in research proposed by the administration would erode the research and innovative capacity of our nation," said Nils Hasselmo, president of the Association of American Universities, a group of 62 public and private research universities.

Bush "really believes that science is important," said John H. Marburger III, the president's science adviser and director of the Office of Science and Technology Policy. Although the budget is "austere," he said, "we are not going backward. We are not going down."

Although NASA Administrator Sean O'Keefe acknowledged that science funding had declined for most agencies during "these challenging times," the "specific policy direction set by the president" for NASA had kept it from feeling the budget ax.

NASA's $16.5 billion budget request was 2.4 percent higher than 2005's final appropriation of $16.1 billion. "The president's endorsement is unabated," O'Keefe told reporters at a NASA headquarters budget briefing.

--Guy Gugliotta and Rick Weiss

Department of State

Department of State logo Spending for the State Department and other key international affairs programs would climb by $4.3 billion, an increase of nearly 16 percent, for a total of $31.8 billion. State alone would have an increase of more than 18 percent in budget authority, for a total of $13.3 billion, with major increases set for diplomatic programs and the global initiative to fight HIV/AIDS.

Overall, international assistance would increase about 14 percent. Much of the new money is $3 billion for the Millennium Challenge Corp., a new foreign aid tool that would tie aid to countries to their meeting judicial and economic criteria. Congress, however, in the past has declined to fully fund the administration's requests for the MCC.

The budget would greatly expand a new office devoted to reconstruction and stablization in post-conflict countries and would create a $100 million fund to quickly deploy civilian personnel to unstable regions. The president's promotion of democracy worldwide would also get a boost, with the budget for the National Endowment for Democracy doubling from 2004 to 2006, to $80 million -- half of which would be devoted to a democracy initiative in the Middle East and North Africa. The budget also allocates $120 million for the Middle East partnership initiative, another program that promotes political and economic reforms.

--Glenn Kessler

Department of Transportation

Department of Transportation logo The Department of Transportation's discretionary budget authority would decrease 6.7 percent to $11.8 billion under the president's proposal. Total budget resources, however, which include trust funds for certain transportation modes, would increase slightly to $59.5 billion from $58.7 billion.

Much of the decrease in funding comes from Bush's plan to withhold nearly all money for Amtrak, the government's passenger railroad. The administration has been trying to encourage Amtrak to reorganize itself so that it can become financially self-sustaining. The budget would provide $360 million to support local commuter rail systems that partner with Amtrak but no money for other Amtrak operations.

"It is clear the current model of passenger rail services is flawed and unsustainable," Transportation Secretary Norman Y. Mineta said today.

The administration's budget would provide funds for the Federal Aviation Administration to hire 1,249 new air traffic controllers to replace those in the agency's aging workforce who are expected to retire. Surface transportation would receive a $28 billion increase over six years through Safe Accountable Flexible and Efficient Transportation Equity Act (SAFETEA).

The Bush budget also calls for the elimination of the Railroad Rehabilitation and Improvement Financing program, a government loan program that Mineta said was redundant. A next-generation high-speed rail research program would also be eliminated.

--Sara Kehaulani Goo

Department of the Treasury

Treasury Department logo The Treasury Department's budget would rise about 4 percent, to $11.6 billion -- the vast majority of it going to the Internal Revenue Service.

The nation's "tax gap" between what Americans owe under the law and the amount they actually pay -- estimated at more than $300 billion a year -- has attracted increased attention, and the administration last week announced that it would seek $500 million in additional budget authority to beef up IRS enforcement efforts. The budget projects that revenue from tax enforcement will rise by $2.6 billion in fiscal 2006.

However, the $500 million is more than the increase the budget seeks for the IRS overall -- it would rise to $10.679 billion from $10.236 approved by Congress this year but remain almost the same as the $10.674 Bush originally requested last year -- requiring the agency to shift resources from other activities, such as taxpayer service and computer modernization. The administration also said the agency is working to increase the efficiency of its programs, which is said will allow more audits and other collection efforts.

--Albert B. Crenshaw

Department of Veterans Affairs

Department of Veterans Affairs logo The Department of Veterans Affairs would see its discretionary spending rise $880 million to $33.4 billion, including revenue from fees collected for some medical services. Most discretionary spending at the VA goes to health care, and the department expects to provide care for 5.2 million patients in fiscal 2006.

In a change criticized by some veterans groups, the budget would more than double prescription drug co-payments for some veterans from $7 to $15, and require them to pay an annual enrollment fee of $250. VA officials said the increases, which would generate about $454 million in revenue, would apply to about 2.37 million non-disabled, higher-income veterans, only about 1.2 million of whom actually use the VA health care system.

Overall, the department's budget would rise to $70.8 billion, including $37.4 billion in mandatory funding on entitlements, such as disability payments, pensions and education and rehabilitation programs for veterans.

--Christopher Lee

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