In accordance with the above, obligations in fiscal year 1972 would be financed from the Highway Trust Fund under the same type of authorization as was previously financed from the General Fund. An obligation level of $20 million for Forest Highways and $10 million for Public Lands Highways is proposed in the President's budget for fiscal year 1972. While it is true that in the President's budget the unused balances of General Fund authorizations are proposed for rescission effective July 1, 1971, the programs would, however, be continued with Trust Fund financing, beginning with the fiscal year 1972 authorizations. It is expected that the States would be able to carry out their higher priority projects under the new Trust Fund authorizations. Enactment of the President's proposal would result in a rescission of $3,846,816.69 in Forest Highway funds apportioned to Idaho. This amount consists of $3,023,993 authorized for fiscal year 1971 and $822,823.69 authorized for fiscal year 1970. Similarly there will be a rescission of $500,000 in Public Lands Highway funds allocated to the State of Idaho. It has been ascertained, however, that the State is not planning to advance the project proposed for financing with these funds to construction prior to June 30, 1971. We appreciate your interest in this matter and trust that the above information will be helpful. Sincerely, JOHN VOLPE. Mr. RUFUS EDMISTEN, U.S. DEPARTMENT OF JUSTICE, Chief Counsel and Staff Director, Subcommittee on Separation of Powers, Committee on the Judiciary, U.S. Senate, Washington, D.C. DEAR MR. EDMISTEN: This will provide the information requested in Senator Ervin's letter of February 3, 1969 addressed to the Attorney General requesting information on instances in which the Bureau of the Budget reserved or impounded funds appropriated to the Department of Justice. Based on the records available to the Department, our response to your four points is negative. The only recent instance in which funds were impounded or reserved by the Bureau of the Budget was on Public Law 90-364 which permits filling three vacancies out of four. As a result of this Public Law $2 million was reserved against funds appropriated to the Department. This amount has since been released by the Second Supplemental. Sincerely, Hon. SAM J. ERVIN, Jr., JOHN J. KAMINSKI, Director, Office of Budget and Accounts. U.S. DEPARTMENT OF LABOR, Chairman, Subcommittee on Separation of Powers, DEAR MR. CHAIRMAN: This is in response to your letter of February 3, 1969, requesting information pertaining to those instances since 1945 in which funds appropriated to the Department of Labor have been withheld by the Bureau of the Budget. With the exception of fiscal year 1968 reserves required by H.J. Resolution 888, P.L. 90-218 ($6,900,000, of which $4,900,000 was made available in fiscal year 1969) and fiscal year 1970 reserves under the Revenue and Expenditure Control Act, P.L. 90-364 ($4,010,000), we are unable to identify, from existing Departmental records, instances where the Bureau of the Budget has withheld appropriated funds. Sincerely, GEORGE P. SHULTZ, Hon. SAM ERVIN, ARLINGTON, VA., March 27, 1971. Chairman, Subcommittee on the Separation of Powers, DEAR SENATOR ERVIN: During my recent appearance before your Subcommittee, I was asked by Professor Miller to consider a case, which he cited, in which a cabinet member had been compelled by judicial process to perform a duty required by law, as a precedent under which your Subcommittee might proceed in its consideration of the plan suggested by Professor Maas, namely that the President personally be required by statute to submit any so-called "impoundment order," and withhold action thereunder until the passage of specific time, during which the matter might be considered by the Congress. My response was to the effect that the head of a cabinet department is not the President. I should like to supplement my response by referring to the following quotation from pages 553-4 of Senate Document No. 39, 88th Congress, 1st Session, a report on the Constitution prepared in 1964 by the Legislative Reference Service, Library of Congress: "By the decision of the Court in State of Mississippi v. Johnson, in 1867, the President was put beyond the reach of judicial direction in the exercise of any of his powers, whether constitutional, political or otherwise . . . But while the courts are unable to compel the President to act or to keep from acting, yet his acts, when performed are in proper cases subject to judicial review and disallowance. Moreover, the subordinates through whom he acts may always be prohibited by writ of injunction from doing a threatened illegal act which might lead to irreparable damage, or be compelled by writ of mandamus to perform a duty definitely required by law. . (Citations omitted). This quotation, I believe, reinforces my advice to the Subcommittee that the Maas suggestion is of doubtful legal validity, and adds weight to my recommendation that the Congress might well move in a much more modest direction, namely, to place mandatory rates of work and time schedules, where appropriate, in statutory enactments which establish projects or programs that are to be executed by heads of Government departments or agencies. If the work proceeds on schedule, there of course would be no question of “impoundment." Sincerely yours, KARL S. LANDSTROM. CONGRESS OF THE UNITED STATES, Hon. SAM J. ERVIN, Jr., HOUSE OF REPRESENTATIVES, Chairman, Subcommittee on Separation of Powers, U.S. Senate, Washington, D.C. DEAR SENATOR ERVIN: I am pleased to respond to your request of January 17 in connection with your inquiry into the question of Presidential or executive impoundment of appropriations, although I am not certain I can add much of great value in the way of fundamental information not already of public record. The question is at all times an important one. Under our system, taxation and appropriation are perhaps the two most cardinal powers available to the Con gress. It is, I believe, wholly accurate to say that, over the long span of time, through many Congresses and many administrations, the weight of experience and practice bears out the general proposition that an appropriation does not constitute a mandate to spend every dollar appropriated. That is a generally accepted concept. It squares with the rule of common sense. I subscribe fully to it. The Congress does not administer the government. Those in executive capacities who do, bear a responsibility to secure the objectives of appropriations at the least practicable cost in all the circumstances. Scattered throughout every annual budget will be found countless unused balances that reverted to the Treasury or carried over for application to future needs, many arising from executive impoundments. And Congress has underpinned that idea with statutory authority to the Executive Branch to impound funds under certain delineated circumstances; the latest permanent enactment is the 1950 revision of the Anti-Deficiency Act. I had occasion to make brief reference to that Act in this general context on the House floor on October 3, 1967, and for convenient reference, enclose a copy of page H12863 of the Temporary Record for that date. As I said on that occasion, however, nothing in the Act gave the President the item veto. The item veto, which I believe has been unsuccessfully advocated in virtually every session for nearly a hundred years, would in my judgment give the President intolerable and utterly unacceptable authority over the Congress. But long before the 1950 revision, the anti-deficiency statute implicitly gave the Executive some limited power to impound funds. Certainly, it was common practice to reserve or impound funds appropriated under the earlier statute, both to guard against overrunning the upper limit of a fixed appropriation amount, to effect savings arising out of changed requirements, or to make some provision for administrative contingencies. In just recent years Congress has, as you know, extended more specific statutory powers or directives to the President to impound funds in "not less than" stated lump-sum aggregates, leaving to him the decision as to the specific funds to be so withheld. It did so in 1967 in H. J. Res. 888 with respect to the fiscal 1968 budget, and last year in the cutback provisions of the Revenue and Expenditure Control Act with respect to the fiscal 1969 budget. While as a general proposition of principle I have preferred that the Congress meets its responsibilities by making specific decisions up, and down the line on the budget, nonetheless these were instances where a majority adopted the somewhat different approach of delegating to the President a portion of the job of allocating lineitem cutbacks to specific appropriations after Congress had fixed upon those specifics. Under the general system that has obtained over the years there have been, to be sure, some more or less celebrated instances of Executive impounding of appropriations that caused considerable controversy between the Legislative and Executive branches as to the powers-statutory and constitutional of the President in this regard. But probably for every seriously controversial case there have been hundreds that never caused a ripple of dissent. I do not have a complete list of outstanding instances, but I readily recall the 1949 action of President Truman in impounding part of the funds appropriated for a 70 group Air Force; and the refusal of the Eisenhower Administration in 1956 to allocate all the funds appropriated to maintain the strength of the Marine Corps. Back in 1942, there was an interesting exchange of letters between President Roosevelt and Senator Russell on the impounding question when the President ordered some school lunch funds withheld from expenditure (see reference in Senate hearings on First Supplemental National Defense Appropriations, 1944, 78th Cong., 1st Sess.). I believe it is fundamentally desirable that the Executive have limited powers of impoundment in the interests of good management and constructive economy in public expenditures. The present statute seems to me to be serving the purpose reasonably well in all the circumstances. It is up to the Congress to be watchful that the Executive does not overstep the bounds of reasonableness, and to deal appropriately with the individual instances as they arise where it feels this has occurred. Occasionally, a "final" resolution may have to be sought by making an issue in the political campaigns. I trust that these brief observations may prove helpful in your deliberations. With all good wishes. Cordially, GEORGE H. MAHON, Chairman. [From the Congressional Record, Oct. 3, 1967] Mr. MAHON. The Bow amendment would assign to the President complete authority as to where to make reductions in spending and shifts in spending and, therefore, of course I could not vote for the Bow amendment. I think the Congress ought to discharge its responsibility, as difficult as it may be at times. RIGHT OF THE PRESIDENT TO WITHHOLD APPROPRIATED FUNDS FROM EXPENDITURE Mr. Speaker, last week, and again today, there has been some debate about the matter of appropriated funds being withheld by the President from expenditure. This is at all times an important question and we should keep before us the law on the matter. Thus I think it would be useful to reprint at this point from my remarks at page H12560, of the RECORD of last Wednesday when we first debated the October continuing resolution: RIGHT OF THE PRESIDENT TO WITHHOLD APPROPRIATED FUNDS FROM EXPENDITURE "A further matter which may be troublesome and which should be considered is that of the right of the President to withhold the spending of funds which have been made available by the Congress. "As a general proposition, there has been and there is in my opinion the attitude on the part of the Members of Congress, on both sides of the aisle, that when Congress appropriates money for Federal programs of one kind or another, it is the responsibility and duty of the Executive, generally speaking, to carry out the will of the Congress and proceed with the programs and expenditures which have been approved by the Congress. "However, the gentleman from Ohio has stated that the President has complete authority to withhold funds which are appropriated and made available to the various agencies of the Government. "And he cites the fact that the President has in many instances-and all Presidents have in some instances-failed to expend, for the programs appropriated for, funds made available by the Congress. "Now, wherein does the President have the authority not to expend funds for the programs which Congress authorizes and appropriates for? I would like to turn to an act which was approved by the Congress in 1950. It is the antideficiency law, and it gives the President some authority to withhold expenditures, but it does not give the President the item veto. We have always taken the position that no President has the right to exercise the item veto, this would give the President authority over the Congress which would be intolerable, and utterly unacceptable. So what did the Congress do under the leadership of the late John Taber, former chairman of the committee, and others? The committee and the Congress improved the antideficiency bill by tightening it up; by putting some teeth in it; by generally improving it. I will read from the antideficiency law the following-31 U.S.C. 665: 'In apportioning any appropriations, reserves may be established to provide for contingencies, or to effect savings whenever savings are made possible by or through changes in requirements-' "In other words, the law says that the President can withhold expenditures and effect savings-and we certainly do not oppose savings-whenever savings are made possible by or through changes in requirements. And there are at times changes in requirements 'greater efficiency of operation.' "If he can make savings by a greater efficiency of operations— 'or other developments subsequent to the date on which such appropriation was made available.' "Now, that is the law, but that does not give the President item veto or indiscriminate authority to withhold the expenditure of funds for programs which have been authorized and funded by the Congress. "The trouble with the so-called Bow amendment which was offered earlier is that it provides complete and total authority for the President to eliminate any and all programs regardless of the provision in the antideficiency law which MARCH 19, 1971. Hon. SAM J. ERVIN, Jr., Chairman, Subcommittee on Separation of Powers, U.S. Senate, Washington, D.C. DEAR SENATOR ERVIN: Your subcommittee is currently studying the problem of apparently illegal executive actions regarding the appropriation power of the Congress. I would like to draw your attention to a multi-billion dollar executive usurpation of the power of the purse. Just this week the Treasury Department has proposed to spend billions of dollars annually in a tax expenditure program never authorized by the Congress. The executive is not 60-337-71-33 merely impounding funds the Congress has appropriated; it is also making expenditures the Congress has not even authorized. The latter practice is the subject of this letter. Once again, powerful private interests have undertaken a raid on the U.S. Treasury. This time, however, Treasury advocacy of private interests has resulted in a proposal which constitutes an unlawful and serious encroachment on the Congressional appropriations power. On March 13, 1971, the Treasury published proposed regulations to make a multi-billion dollar tax expenditure in the form of a depreciation write-off subsidy. This subsidy will cost $3 billion in Fiscal 1972 alone, and much more in later years. $3 billion is over $45 per taxpayer each year. The Congress has instructed the Treasury, in Section 167 of the 1954 Internal Revenue Code, to allow a depreciation deduction which is a "reasonable allowance" for exhaustion, wear and tear, and obsolescence of business machinery and equipment. The new Treasury proposals violate this mandate. In the name of stimulating a badly managed economy, the Treasury seeks to use the depreciation write-off as a massive subsidy to favored businesses. I enclose for your consideration a thoughtful analysis of the unlawfulness of the Treasury action. The author, Mr. Robert J. Domrese of the Harvard Law School, is an editor of the Harvard Law Review. His study merits the close attention of a Congress which, "through a process of subtle attrition appears to be surrendering its traditional wellspring of strength, the power of the purse." As Mr. Domrese points out, the Treasury's proposal represents a radical departure from the Congressionally mandated system of depreciation allowances. Rather, it is a capital cost recovery system never authorized in the tax laws. Indeed, the President's own Task Force on Business Taxation has warned the Treasury that such a departure from the law required Congressional rather than executive action.2 Mr. Domrese supports this conclusion with an extensive historical survey of our tax laws. The legislative history of those laws leaves no doubt that a policy change of this magnitude is a matter for elected representatives in Congress to decide rather than to be decided by executive fiat. The executive action in this case not only violates the fundamental principle of separation of powers; it is also fantastically expensive. The cost per taxpayer per year will rise from over $45 in fiscal 1972 to over $70 in fiscal 1976. As Mr. Domrese points out, this latter figure is twice the budgeted amount for the entire Environmental Protection Agency for next year, and over 30 times as much as is budgeted for our overburdened Federal judicial system. The adoption of this massive tax expenditure by an executive department violates the fundamental principle of the separation of powers under our Constitution. The Framers of the Constitution had good reason to reserve the power of the purse in the Congress rather than the executive branch. The Congress is the branch of government which was conceived as the most responsive to popular needs. By contrast, bureaucratic policymakers in the executive branch are sheltered from healthy public scrutiny. In the tax policy area, the insulation of Treasury officials from public evaluation and judgment is even more pronounced because of the complex nature of most tax questions. In order to protect the public from unlimited bureaucratic discretion, the Congress passed the Administrative Procedure Act which, among other important provisions, provides that an agency shall give notice before promulgating rules, and "shall give interested persons an opportunity to participate in the rule making through submission of written data, views, or arguments . . .” 1 Senator Frank Church, "Impoundment of Appropriated Funds: The Decline of Congressional Control Over Executive Discretion," 22 Stanford L. Rev. 1240, 1241 (1970). 2 "Since the shift from depreciation to cost recovery unrelated to the useful life concept does require amendment of the present law, we urge that all the matters covered in the recommendations which are related to such a shift be incorporated in the statute." Report of the President's Task Force on Business Taxation, p. 29 (September 1970). The Task Force recommended a 40% shortening of the guideline lives rather than the 20% proposed by the Treasury. 35 U.S.C. 553(b). The legislative history of the Administrative Procedure Act shows the intent of Congress that "The effect of this provision will be to enable parties to express themselves in some informal manner prior to the issuance of rules and regulations, so that they will have been consulted before being faced with the accomplished fact of a regulation which they may not have anticipated or with reference to which they have not been consulted.' Statement of Francis E. Walter. Chairman of the concerned subcommittee of the House Judiciary Committee reporting the bill to the Floor. Cong. Rec. 79th Cong., 2nd Sess., May 26, 1946. See also report of the Senate Judiciary Committee, S. Rep. No. 752, 79th Cong.. 1st Sess., (1945) especially pp. 13-15. |