SPECIAL REPORT: President’s Budget

Proposal for Fiscal Year 2012, California

Implications – February 14, 2011

        On Monday, February 14, 2011, President Barack Obama released the Administration’s Budget Proposal for Fiscal Year 2012, which begins October 1, 2011. $3.73 trillion fiscal 2012 budget Monday that he said would reduce the deficit by more than $1 trillion over a decade The Budget proposes FY 2012 spending of $3.73 trillion and calls for deficit reduction of more than $1 trillion over the next ten years. Discretionary spending, excluding Iraq and Afghanistan costs, is set at $1.12 trillion, roughly a 2.8 percent increase over the FY10 enacted level of $1.08 trillion in discretionary spending.

        The President has proposed freezing discretionary spending for five years, with the exception of spending for the military, homeland security, the State Department and Veterans Affairs. The documents explain that this is not an across-the-board cut, however, but rather an overall freeze with continued increases in spending in areas the Administration considers “critical for long-term economic growth and job creation.” The Administration estimates that this freeze will save more than $400 billion over ten years. Included in the freeze, is a 2-year freeze on Federal civilian worker salaries.

        The budget documents outline the Administration’s recommendations for discretionary and mandatory spending, as well as its revenue proposals. Developing a reliable analysis of any budget is difficult. This document provides a California-oriented analysis of the proposal prepared by the staff of the California Institute for Federal Policy Research. It is available on the Institute’s website at http://www.calinst.org/pubs/Budget2012.shtml or alternatively in pdf format at http://www.calinst.org/pubs/Budget2012.pdf .








































        The FY2012 proposed funding for the Department of Homeland Security is approximately $43.2 billion, versus the $43.5 billion requested in FY 2011, and the FY10 actual spending of $39.8 billion.

Citizenship and Immigration Services

        The budget requests $365,000,000, of which $132,361,000 is for immigration verification programs, including the E-Verify Program. Actual spending for FY10 for CIS was $235 million.

        Within total funding, the Administration also requests $20 million to promote citizenship through education and preparation programs, replication of promising practices in integration for use by communities across the Nation, and expansion of innovative English-learning tools.

         The Budget assumes that USCIS will continue to be funded primarily through fees on the applications and petitions it adjudicates.

Immigration and Customs Enforcement

        For salaries and expenses of ICE the FY11 Budget proposes $5,495 billion, compared to the FY 10 actual spending of $5.440billion. 

        Within the funding, not less than $2,734,625,000 is for detention and removal operations, including transportation of unaccompanied minor aliens.

Federal Law Enforcement Training Center

      For 2012 the Budget requests $276 billion FLETC, compared to $282 million in FY10. The Center, in addition to providing law enforcement training to federal personnel, provides training to State and local law enforcement personnel on a space-available basis.  

Customs and Border Protection

        The Budget proposes $10.38 billion in FY12 discretionary authority, compared to the FY10 spending of $10.12 billion. This funding will support 21,370 Border Patrol agents and funds an additional 300 new Customs and Border Protection (CBP) Officers for passenger and cargo screening, as well as expansion of pre-screening operations at foreign airports and land ports of entry.

Border Security Fencing, Infrastructure, and Technology

        A total of $527,623,000 is requested for border security, fencing, and infrastructure, compared to the roughly $800 million in FY11 spending under the Continuing Resolution. Rather than continue with the Secure Border Initiative, the Administration proposes the refocusing of border surveillance technology funding “toward existing and proven technology.”

United States Visitor and Immigrant Status Indicator

        The 2012 Budget includes approximately $302.3 million for US-VISIT, to create an automated entry and exit system; to integrate existing biometric databases; use available data to match alien arrival and departure records; and use biometrics to screen visa applicants and applicants for admission to the United States against law enforcement databases.

        The budget proposes permanently cancelling $25,642,000 of unobligated balances appropriated for biometric air exit programs in prior year appropriations.

Federal Emergency Management Agency

        The budget requests about $6.790 billion for total FEMA funding, compared to actual FY10 funding of $7.116 billion.

        State and Local Programs

        The budget requests $3,844,663,000 for state and local programs, of which $2,083,000,000 is proposed for State and Regional Preparedness Programs, and $1,050,000,000 for the State Homeland Security Grant Program. Included within this funding is $50,000,000 for Operation Stonegarden which addresses the Nation’s Southwest Border security issues. This funding is relatively flat compared to the FY11 budget request.

        Within total funding for state and local programs, $670,000,000 is requested for the Firefighter Assistance Grants program. The program is rurally-focused and, therefore, California receives only about 5 percent of funds generally.

        The Budget requests $920,000,000 for the Urban Area Security Initiative. The FY11 budget request was for $1.1 billion.

        The Budget also proposes $300,000,000 for Port Security Grants, the same as the FY11 request.

        Pre-Disaster Mitigation Fund

        $85 million is proposed for the Pre-Disaster Mitigation grant program, about $15 million than the estimated FY11 funding of $100 million.

        Disaster Relief Funding

        The budget proposes $1.8 billion, compared to the estimated $1.5 billion in FY11 CR funding. The DRF is used in the instance of a presidentially-declared disaster or emergency by the Federal Emergency Management Agency to assist State and local governments in the response, recovery, and mitigation against emergency and disaster events.


        Total discretionary budget authority for the Department of Education is proposed at $77.7 billion, an increase from the $72.9 billion estimated for FY11 under the continuing resolution.

Pell Grants

        Federal Pell Grants are the single largest source of grant aid for postsecondary education. The Budget request includes $41.2 billion for Pell Grants in 2012, of which $28.6 billion is discretionary, to support a projected maximum award of $5,550.

        The Budget proposes eliminating year-round Pell Grants in an award year, which are currently available to certain students and the in-school interest subsidy for graduate and professional student loans. In addition, concurrent with the release of the 2012 Budget, the Department of Education will announce administrative steps to reduce improper payments in the Pell Grant program by directing students and parents to use an existing IRS data retrieval process to populate or update income data elements on the student aid application beginning in January 2012.  

Advanced Research Projects Agency-Education

        The Budget includes $80 million to expand promising and effective models of teacher preparation, which will help train effective STEM teachers. In addition, the Budget includes $90 million for a new Advanced Research Projects Agency-Education (ARPA-ED) in 2012 that would promote dramatic breakthroughs in educational technology. 

Elementary and Secondary Education Act

        The budget allocates $26.8 billion, an increase of 6.9 percent, in a reformed Elementary and Secondary Education Act (ESEA) focused on raising standards, encouraging innovation, and rewarding success, while allowing States and districts more flexibility to invest resources where they will have the greatest impact. The new ESEA directs funds to reform-oriented competitive initiatives, consolidates dozens of programs, and cuts programs that do not demand results.

        Excellent Instructional Teams: The President’s Budget allocates $3.5 billion for Excellent Instructional Teams, a program that seeks to increase teacher effectiveness and reduce disparities in access to high-quality teachers and school leaders between disadvantaged students and their peers.

        Effective Teaching and Learning for a Complete Education: The President’s Budget allocates $835 million for Effective Teaching and Learning for a Complete Education, a program aimed at building on the Administration’s efforts to raise the quality and rigor of academic standards and instruction.

        Expanding Educational Options: The President’s Budget allocates $372 million for Effective Expanding Educational Options, a program that supports increasing the supply of high-quality educational options available to students in low-performing schools by creating and expanding effective charter schools and other effective, autonomous and accountable schools, and by implementing comprehensive systems of public school choice.

        College Pathways and Accelerated Learning: The President’s Budget allocates $86 million for College Pathways and Accelerated Learning, a program aimed at expanding educational opportunities for all students by providing accelerated courses and instruction in schools that enroll concentrations of students from low-income families.

Supporting Student Success: The budget proposal allocates $1.8 billion to Supporting Student Success, a program that promotes safe and drug-free learning environments for students. It consolidates six existing programs into the new Successful, Safe, and Healthy Students program. In addition to these consolidations, this proposal also includes two other programs, Promise Neighborhoods and a reformed 21st Century Community Learning Centers.

Race to the Top: The proposal provides $1.4 billion for new competitions for Race to the Top which was created under the American Recovery and Reinvestment Act (ARRA). It creates incentives for State and local reforms and innovations designed to lead to significant improvements in student achievement, high school graduation rates, and college enrollment rates, and to significant reductions in achievement gaps.

Investing in Innovation: The administration’s proposal provides $300 million for the Investing in Innovation program, which was created under the ARRA. It enables the Department to continue to invest in high-impact, potentially transformative education interventions, ranging from new ideas with huge potential to those that have proven their effectiveness and are ready to be scaled up.

College- and Career- Ready Students

The proposed budget provides $14.8 for the College- and Career- Ready Students program. This program was formerly called the Title I Grants to Local Education Agencies program. The budget document goes onto state that budget authority is same as the program level in 2010 and $841 million less than the program level in 2012.

Special Education State Grants

The budget proposes $ 12.6 billion for Special Education State Grants, as compared to the estimated $12.3 billion enacted in FY10. Formula grants are provided to States to assist them in providing special education and related services to children with disabilities ages 3 through 21.


        The budget provides the Department of Transportation $13.4 billion in discretionary resources in 2012, a $1.3 billion decrease from 2010 levels. (This figure excludes $109 billion in obligation limitations for the surface transportation plan. Including surface transportation obligation limitations, Department of Transportation’s total budgetary resources increase by $53 billion over 2010.)

        The President’s Budget also includes a $556 billion, six-year surface transportation reauthorization proposal including highways, transit, highway safety, passenger rail, and a National Infrastructure Bank. The proposal is an increase of over 60 percent above the inflation-adjusted levels in the previous surface transportation reauthorization, plus annual appropriated funding for passenger rail funding in those years.

        The Administration proposes to reclassify all surface transportation outlays as mandatory, consistent with the recommendations of the President’s National Commission on Fiscal Responsibility and Reform, and to also move a number of current General Fund programs into the Transportation Trust Fund.

Transportation Planning Research and Development

        The President’s Budget proposes $9,824,000 to Transportation Planning Research and Development for necessary expenses for conducting transportation planning, research, systems development, development activities, and making grants.

Federal Aviation Administration (FAA)

        The President’s Budget requests $12.9 billion in FAA budget authority, increased from the FY10 enacted funding of $12.5 billion.

        To spur job growth and allow States to initiate sound multiyear investments, the Budget includes a $50 billion boost above current law spending for roads, railways and runways. Within this funding appropriation, the Budget requests a one-time appropriation of $250 million in mandatory General Fund resources to advance FAA’s next generation air-traffic control system (NextGen) and make near-term improvements in FAA’s air traffic control infrastructure. $200 million will be used to accelerate applied research, advance development, and implement engineering solutions for NextGen technologies, applications, and procedures; and $50 million will be used to upgrade FAA capital infrastructure such as power systems and air traffic control centers and towers.

Federal Highway Administration (FHWA)

        The 2012 Budget consists of $70,414 million in new budget authority for FHWA and $51,552 million in outlays.

        Also included in the President’s FY2012 $50 billion boost are $25 billion in FHWA funds to be apportioned to the States for critical highway infrastructure on enhanced National Highway System, $2.2 billion to support significant improvements at land ports of entry facilities which link directly to the transportation infrastructure at border crossing locations, and $450 million to address the growing demand for TIFIA credit assistance.

Orange County (CA) Toll Road Demonstration Project Program Account

        As required by the Federal Credit Reform Act of 1990, this account records the subsidy costs associated with the direct loans obligated in 1992 and later years (including modifications of direct loans, loan guarantees, or lines of credit that resulted from obligations or commitments in any year) as well as administrative expenses of this program. The Department provided these lines of credit for two toll road projects in Orange County, California. This account was closed at the end of 2010.

National Highway Traffic Safety Administration (NHTSA)

        The 2012 Budget requests $0 in discretionary budget authority for the NHTSA. The program has been allocated $860 million in discretionary obligation limitations/mandatory contract authority.

Federal Railroad Administration (FRA)

        The budget requests $183 million, compared to $295 million enacted in FY10 funding. The President also proposes $8 billion in 2012 and $53 billion over six years to reach the goal of providing 80 percent of Americans with convenient access to a passenger rail system, featuring high-speed service, within 25 years. This includes merging Amtrak’s stand-alone subsidies into the high-speed rail program as part of a larger, competitive System Preservation initiative.

Federal Transit Administration (FTA)

        The 2012 Budget proposes $150 million in discretionary budgetary authority for the FTA. The FTA provides funding to transit operators, State and local governments and other recipients for the construction of facilities; the purchase of vehicles and equipment; the improvement of technology, service techniques, and methods; the support of region-wide transportation planning; and transit operations. FTA also provides financial assistance to help implement other national goals relating to mobility for the elderly, people with disabilities, and economically disadvantaged individuals. Transit funds are split between formula/bus and capital investment discretionary grant accounts.

Research and University Research Centers

        The Budget proposes a $59 million allocation for transit research programs, a decrease of $3 million when compared to the estimated for FY11 under the continuing resolution.

Formula and Bus Grants

        The 2012 Budget presents FTA’s proposed reauthorization program and account structure. This includes renaming the Formula and Bus Grants account to the Transit Formula Grants account and reorganizing programs within the account. Some programs previously funded here have been merged with others or moved to other accounts. The account is funded from the Mass Transit Account of the Transportation Trust Fund. The 2012 Budget request includes $7.7 billion for this account, and over six years, the Administration proposes to invest $46.6 billion.


National Infrastructure Bank (NIB)

        The President’s budget includes $30 billion over six years for a National Infrastructure Bank to invest in projects of regional or national significance to the economy. According to the budget document, NIB investments will be issued in the form of grants, loans, or a blend of both and will target transportation and transportation related projects that provide a significant economic benefit to the Nation or a region.


        The President’s Budget proposes new budget authority of $41.7 billion for the Department of Housing and Urban Development, as compared to the $41.6 billion estimated for FY11 under the Continuing Resolution.

Community Development Block Grant programs (CDBG)

        The Community Development Block Grant (CDBG) program provides flexible annual formula grants to State and local governments to benefit mainly low- to moderate-income persons. The Budget provides $3,691,368,000 for FY 2012 to fund the CDBG. The Budget reduces funding for the CDBG by 7.5 percent or $300 million relative to current funding levels.

Tenant-based Rental Assistance

        The 2012 Budget provides $19.2 billion for the Tenant-Based Rental Assistance Program (also known as the Housing Choice Voucher program). The Housing Choice Voucher program provides housing assistance to over two million extremely low- to very low-income families to rent in the neighborhoods of their choice. This is the Federal government’s largest and most income-targeted program for assisting very low-income families to rent housing in the private market.

Project-Based Rental Assistance

        The Budget requests $9.4 billion for project-based rental assistance, of which $400 million is requested as an advance appropriation to become available in 2013. Project-Based Rental Assistance helps make housing more affordable by subsidizing the landlords who make a certain portion of their residences available to low-income individuals.

Public Housing Capital Fund

        The budget proposes $2.4 billion for the Capital Fund, a formula-driven program based on estimated need. It is designed to respond to the capital and management improvement requirements of public housing. The program serves approximately 1.2 million families with limited income.

        Of the $2.4 billion requested for this program, over $2.3 billion will fund capital grants to public housing authorities. The balance includes up to $15 million for public housing financial and physical assessment support, up to $20 million for emergency capital needs resulting from non-Presidentially declared emergencies and natural disasters, and up to $5 million for administrative and judicial receiverships.

The Choice Neighborhoods Initiative

        The Budget proposes $250 million for the Choice Neighborhoods Initiative to continue the transformation of neighborhoods of poverty into functioning, sustainable mixed-income neighborhoods with appropriate services, schools, public assets, transportation, and access to jobs. The goal of the program, first funded in 2010, is to demonstrate that concentrated and coordinated neighborhood investments from multiple sources can transform a distressed neighborhood and improve the quality of life of current and future residents. HUD expects to award its first Choice Neighborhoods planning and implementation grants in March and September 2011, respectively.

HOME Investment Partnership

        The Budget requests $1.65 billion for the HOME Investment Partnership Program. This account also reflects a $2.25 billion special allocation of HOME funds provided under the American Recovery and Reinvestment Act of 2009, called the Tax Credit Assistance Program (TCAP). Both HOME and TCAP funds will contribute to HUD’s high priority performance goal to increase the number of families served by its rental housing programs.

Homeless Assistance Grants

        The Budget requests $2.37 billion for a wide range of activities to assist homeless persons and prevent future homelessness. HUD estimates it will use $1.91 billion for competitive renewal in the Continuum of Care (CoC) program, $286 million for the Emergency Solutions Grant Program, $50 million in incentives for public housing agencies and private owners of HUD-assisted housing to serve additional homeless households in high-need areas, and approximately $130 million for new competitive projects in the CoC, the Rural Housing Stability Assistance program, the homeless data analysis project, and authorized administrative costs.

Housing Opportunities for Persons with AIDS (HOPWA)

        The Budget proposal fund for HOPWA amounts to $335,000,000 as compared to $332,000,000 in FY10. HOPWA funding provides States and localities with resources and incentives to devise long-term comprehensive strategies for planning and providing housing and supportive services to meet the complex, multiple needs of persons living with HIV and AIDS and their families.

Housing for the Elderly

        The Budget proposes $757,000,000 in FY12 funding for housing for the elderly, as authorized by section 202 of the Housing Act of 1959. The Housing for the Elderly program provides capital advance grants and operating subsidies to nonprofit sponsors to construct and operate supportive housing for very low-income elderly households, including frail elderly.

Housing for People with Disabilities

        The Budget proposes $196,000,000 in FY12 to fund the Housing for Persons with Disabilities program. The program provides capital advance grants and operating subsidies to nonprofit sponsors to construct and operate supportive housing for very low-income people with disabilities.


        The Budget requests $20.9 billion in total spending for the Department of Justice, as opposed to the $24.14 billion estimated in FY11 spending under the Continuing Resolution. 

        Office of Justice Programs, Office of Community Oriented Policing Services, Office on Violence Against Women

        The Budget requests $2.964 billion in total funding, as opposed to the $3.552 billion in actual FY2010 spending.

        Of that, $178.5 million is for the Office of Justice Programs. This account includes programs that provide grants, contracts, and cooperative agreements for research, development and evaluation; development and dissemination of quality statistical and scientific information; victim services for children; and nationwide support for law enforcement agencies.

        State and Local Law Enforcement Assistance

        The 2012 Budget requests about $1.17 billion for the Office of Justice Programs’ (OJP) State and Local Law Enforcement Assistance direct program activities, compared to the $1.614 billion in FY11 funding under the Continuing Resolution.  

Within that total funding are the following programs: 

        SCAAP – The Budget proposes funding the State Criminal Alien Assistance Program at $136 million, compared to the roughly $336 million appropriated under the current Continuing Resolution. The budget also includes the following proviso: “Provided, That no jurisdiction shall request compensation for any cost greater than the actual cost for Federal immigration and other detainees housed in State and local detention facilities.” California receives about 40 percent of SCAAP funding. 

        – Southwest Border Prosecutor Initiative – The Budget proposes zero-funding the Southwest Border Prosecutor Initiative, compared to its request of $30 million in FY10. This initiative provides funding for local prosecutor offices in the four border states, California, Texas, Arizona, and New Mexico.

        – Byrne Justice Assistance Grants (JAG) – The Edward Byrne Memorial Justice Assistance Grants program awards grants to state and local governments to support a broad range of activities to prevent and control crime based on local needs and conditions, including: law enforcement programs; prosecution and court programs; prevention and education programs; corrections and community corrections programs; drug treatment programs; and planning, evaluation, and technology improvement programs. The FY 2012 Budget proposes $519 million for the program. Of that, $30,000,000 is for bulletproof vests and other law enforcement safety assistance, and $2,000,000 is for the State and Local Anti-Terrorism Training program.

        The Budget recommends zeroing out funding for Byrne discretionary grants, which are funded at about $185 million under the current CR.

        – Byrne Competitive Grants – The Byrne Competitive Grants program awards grants to state, local, and tribal government agencies, for-profit and non-profit organizations, and faith-based and community organizations to improve the functioning of the criminal justice system and assist victims of crime. The FY 2012 Budget proposes $25,000,000 for this program, compared to the FY11 spending estimate of $40 million.

        – Byrne Criminal Justice Innovation Program

        This program aims to control and prevent violent crime, drug abuse and gang activity in designated high crime neighborhoods by providing funding to support partnerships between law enforcement agencies and community-based organizations that balance targeted enforcement with prevention, intervention, and neighborhood restoration services. The Administration maintains that the program is an integral part of its multi-agency Neighborhood Revitalization Initiative, which aims to support the transformation of distressed neighborhoods. The 2012 Budget proposes $30,000,000 for this program.

        Community Oriented Policing Services

        The FY 2012 Budget requests $669.5, compared to about $537 million under the FY11 CR funding, for the Office of Community Oriented Policing Services (COPS) Appropriations account, which supports programs administered by COPS and the Office of Justice Programs (OJP). Included within that funding is:

        Hiring Grants. The hiring grants initiative provides funding to state, local and tribal law enforcement agencies to hire additional sworn law enforcement officers deployed in community policing activities. The initiative will continue to support the Administration’s goal of hiring 50,000 law enforcement officers nationwide. The FY 2012 Budget proposes $600,000,000 for this program, the same as the FY11 request. Within this amount, $50,000,000 will be dedicated towards the hiring of non-sworn law enforcement personnel in order to permit the redeployment of sworn officers to community policing duties, $42,000,000 will be dedicated towards the hiring of tribal law enforcement officers, and $20,000,000 will be available for a college loan repayment program for new officers as an added incentive for highly-skilled college graduates who might not otherwise consider careers in the challenging law enforcement field.


        Juvenile Justice Programs

        The Administration request is $280,000,000 Juvenile Justice Programs, compared to the FY11 spending of about $437 million. The FY10 figure was about $423,595,000.  

        Juvenile Justice System Incentive Grants

        The Administration proposes a new initiative to consolidate funding targeting juvenile justice improvements into a competitive program that rewards or incentivizes states for progress against key indicators for the juvenile justice system, including (but not limited to): engagement in community-based juvenile strategic planning, implementation of evidence-based strategies and practices, employment of diversion strategies, and reduction of disproportionate minority contact. The new program will be open only to states achieving compliance with the requirements of the Juvenile Justice and Delinquency Prevention Act. The 2012 Budget proposes $120,000,000 for this program. 


        The Budget includes $23.9 billion in discretionary budget authority for FY 2012, as compared to the $25.7 billion estimated for FY11 under the continuing resolution. Investments are made in renewable energy and key research areas and savings are created by reducing direct payments to high-income farmers, refocusing USDA’s homeownership programs, and targeting USDA conservation programs.

U.S. Forest Service

        The President has requested $5.2 billion for the U.S. Forest Service. The Budget reflects an accelerated refocusing of national forest management to forest ecosystem restoration project work, including global climate change adaptation and mitigation.

Market Access Program (MAP)

        Under the MAP, Commodity Credit Corporation (CCC) Funds are used to reimburse participating organizations for a portion of the costs of carrying out overseas marketing and promotional activities. The 2008 Farm Bill continued the authority for the MAP program with funding of $200 million for 2008-2012. The budget calls for the $200 million in funding for FY12. California agriculture interests have been heavy users of MAP, which seeks to develop and expand commercial export markets for U.S. agricultural products.

Agricultural Research Service

        The Budget proposes $1.13 billion in discretionary budget authority for the Agriculture Research Service. The ARS’ 2012 Salaries and Expenses Budget proposes high priority increases of $55.7 million for new and expanded research initiatives in food safety; crop/animal breeding and protection; child and human nutrition; bioenergy/biomass; plant, animal, and microbial collections; production systems for sustainable agriculture; global climate change; and the National Agricultural Library.

        ARS’ requested $100.7 million in proposed decreases for lower priority projects. The proposed reductions include $41.9 million in Congressional earmarks, $38.7 million in project terminations, and $20.1 million in extramural research terminations.

The Agriculture and Food Research Initiative (AFRI)

        The 2012 Budget proposes to increase funding for AFRI from $262 million to $325 million, a 61 percent increase in this program from 2009. The Agriculture and Food Research Initiative targets increases for research in areas that are key to American leadership: human nutrition and obesity reduction, food safety, sustainable bioenergy, global food security, and climate change.

Animal and Plant Health Inspection Service

        The Animal and Plant Health Inspection Service’s 2012 Budget request of $833 million is an overall reduction of $75 million from 2011, and includes $64 million in priority increases offset by reductions of $138 million. The Budget states that these reductions, which include $2 million from the glassy-winged sharpshooter/Pierces disease program, are a result of programs achieving success. The Budget is also requesting appropriated funding to continue pest programs initiated using emergency funds and is requesting an additional $10 million to implement a sterile insect technique to control pest populations.

Food Safety and Inspection Service

        The budget requests $1.2 billion for the Food Safety Inspection Service. This service is limited only to meat, poultry and egg products. The 2012 Budget proposes a $7 million decrease from the 2011 proposed funding level for inspection of meat, poultry, and egg products.

Agricultural Marketing Service

        The budget requests $94,755,000 for the Agricultural Marketing Service. These marketing activities assist producers and handlers of agricultural commodities by providing a variety of marketing services.

Economic Research Service

        The President’s Budget includes $85,971,000 for Economic Research Service to provide economic and other social science research and analysis for public and private decisions on agriculture, food, natural resources, and rural America.

Wildland Fire Management

        The President’s Budget includes $1.9 billion for Wildland Fire Management, compared with $2.3 billion estimated for FY11 under the continuing resolution. This appropriation provides funding for Forest Service fire management, presuppression, and suppression on National Forest System lands, adjacent State and private lands, and other lands under fire protection agreement

Food and Nutrition Service

        The budget includes $7.9 billion for the Supplemental Nutrition Assistance Program (SNAP). The Women, Infant, and Children (WIC) program that serves the nutritional needs of low-income pregnant and postpartum women, infants, and children up to age five is provided $7.4 billion in the 2012 Budget. California typically receives about 16% of WIC funds, which would amount to approximately $1.26 billion. The budget also provides $35 million for the Healthy Food Financing Initiative to bring grocery stores and other healthy food retailers to underserved communities.

National Forest Land Acquisition

        For acquisition of lands within the exterior boundaries of the Cache, Uinta, and Wasatch National Forests, Utah; the Toiyabe National Forest, Nevada; and the Angeles, San Bernardino, Sequoia, and Cleveland National Forests, California, as authorized by law, the budget proposes $955,000 to be derived from forest receipts. The purpose of these land acquisitions is to provide soil stabilization and restoration of vegetation within these watersheds. In addition, the Administration plans to minimize erosion and flood damage to these areas through this acquisition program.


        The President’s Budget proposes $12.8 billion in funding for the Department of Labor, a 5 percent reduction from the 2010 enacted level of $13.5 billion. This reflects a shift in investments to a new Workforce Innovation Fund and increases for worker protection and mine safety programs. The Budget achieves savings through a reduction in funding for the Senior Community Service Employment Program, and transfers it to the Department of Health and Human Services to improve coordination with other programs for seniors. The Budget also includes a 25 percent reduction in the Job Corps construction budget.

Employment and Training Administration

        The Administration proposes $1.6 billion in discretionary budget authority for the Employment and Training Administration. Contributions of $69 million from Adult activities, $94 million from Dislocated Worker activities, and $74 million from Youth activities will help support a $379 million Workforce Innovation Fund for competitive grants to test innovative strategies and replicate evidence-based practices in the workforce system.

Employee Benefits Security Administration

        For the 2011 budget, the Administration proposes $197,528,000, increased from the 2010 enacted level of $155,000,000.

Occupational Safety and Health Administration

        The Administration requests $583,386,000 for the Occupational Safety and Health Administration; $105,893,000 being the maximum amount available for grants to States under 23(g) of the Occupational Safety and Health Act.


        The budget proposes $79.9 billion in discretionary authority for HHS, as compared to the $81.3 billion estimated for FY11 under the continuing resolution.

Grants to States for Medicaid

        The budget includes $184,279,110,000 for carrying out, titles XI and XIX of the Social Security Act. Medicaid assists States in providing medical care to their low income populations by granting Federal matching payments under title XIX of the Social Security Act to States with approved plans.

The Grants to States for Health Insurance Premium Review

        The President’s budget includes $51,000,000 in total new obligations to fund grants to states for health insurance premium review. The Affordable Care Act amends the Public Health Service Act and provides that the Secretary shall carry out a program to award grants to States for a five year period beginning in fiscal year 2010. The Grants to States for Health Insurance Premium Review program will allow States to improve the oversight of proposed health insurance premium increases and provide the Secretary with trend information about premium increases in health insurance coverage. The program provides $250,000,000 over the five year period beginning with fiscal year 2010, and States may receive no less than $1,000,000 and no more than $5,000,000 in any one grant year.

National Institutes of Health

        The budget requests $31.8 billion for the National Institutes of Health, compared to $30.7 billion in FY11 under the continuing resolution. This program funds biomedical research and research training.

Food and Drug Administration (FDA)

        The budget requests $2.7 billion for the FDA, compared to $2.6 billion in FY11 under the continuing resolution. The FDA is responsible for protecting the public health by assuring the safety, efficacy, and security of human and veterinary drugs, biological products, medical devices, our Nation’s food supply, cosmetics, and products that emit radiation.

Substance Abuse and Mental Health Service Administration (SAMHSA)

        The FY12 budget allocates $3.4 billion for SAMHSA. This program builds partnerships with states, communities, tribal and private not-for-profit organizations to enhance health and reduce the adverse impact of substance abuse and mental illness on America’s communities.


        The budget requests $8.8 billion for the Department for FY11, as compared to the $9 billion estimated for FY11 under the continuing resolution and $13.9 billion enacted in FY10.

Economic Development Assistance Programs

        The budget requests $325 million, compared to $293 million enacted in FY10 funding. Within that funding, the budget provides $75 million in regional planning and matching grants to support the creation of Regional Innovation Clusters to leverage regions’ competitive strengths to boost job creation and economic growth.

        The Budget also provides $40 million to Economic Development Administration (EDA) as part of the Growth Zones initiative, a national competition that will create a “Race to the Top” for Regional Economic Growth. The Economic Development Administration (EDA), with assistance from the Department of Housing and Urban Development and the Department of Agriculture, will provide the 20 winning Zones with grants to facilitate rigorous economic development analysis, additional strategic planning, capacity building, and, implementation.

International Trade Administration (ITA)

        The budget requests $517 million, compared to $447 million enacted in FY10. ITA improves the competitiveness of U.S. industry, promotes trade and investment, and ensures fair trade and compliance with trade laws and agreements.

National Telecommunications and Information Administration (NTIA)

        The budget requests $8.7 billion for NTIA, compared to $9.1 billion estimated for FY11 under the continuing resolution. NTIA is the principal Executive Branch adviser on domestic and international telecommunications policy and manages the Federal Government’s use of the radio frequency spectrum and performs extensive research in telecommunication sciences.

        As part of the Wireless Innovation and Infrastructure Initiative (WI3), the primary focus of NTIA’s activities in 2012 will be supporting the creation of a public safety broadband network and spectrum reform. The Administration proposes to reallocate a total of 500 megahertz of Federal agency and commercial spectrum bands over the next 10 years in order to increase Americans access to wireless broadband to facilitate access for smart phones, portable computers, and innovative technologies that are on the horizon. As part of this initiative, EDA will participate in the WIN Fund by setting aside $100 million over the next five years in prize and grant competitions to fund development of regional clusters of wireless innovation.

Pacific Coastal Salmon Recovery

        The FY12 budget requests $65 million consistent with FY10 levels, for the Pacific Coastal Salmon Recovery. The Pacific Coastal Salmon Recovery Fund account was established in 2000 to augment State, tribal, and local programs to conserve and restore sustainable Pacific salmon populations and their habitats. Through 2010, over $880 million has been provided to the States of California, Oregon, Washington, Alaska, and Idaho to restore salmon and steelhead populations that are listed as threatened or endangered, or identified by a State as at risk of such listing; maintaining populations necessary for exercise of tribal treaty fishing rights or native subsistence fishing; or restoring and conserving Pacific coastal salmon and steelhead habitat.

National Marine Fishery Services (NMFS)

        The budget request for FY12 is $911 million, compared to $892 million estimated for FY11 under the continuing resolution. NMFS programs provide for the management and conservation of the Nation’s living marine resources including fish stocks, marine mammals, and endangered species and their habitats within the United States Exclusive Economic Zone (EEZ). The Budget supports the reauthorized Magnuson-Stevens Act through increased funding to assess major fish stocks and protected species and to promote innovative approaches to fisheries management.

National Oceanic and Atmospheric Administration (NOAA)

        The proposed FY12 NOAA budget is $5.4 billion compared to $4.9 billion enacted in FY10. In 2012, NOAA proposes to reorganize its climate programs into a line office for climate services, making a total of seven line offices that will execute its mission to understand and predict changes in the Earth’s environment and to conserve and manage coastal and marine resources to meet our Nation’s economic, social, and environmental needs.

National Institute of Standards and Technology

        The budget request for FY12 is $1 billion, compared to $863 million enacted in FY10. The budget provides $764 million for the National Institute of Standards and Technology laboratories, $75 million for the Technology Innovation Program, and $12 million for Advanced Manufacturing Technology Consortia, and by strengthening the fee structure at the U.S. Patent and Trademark Office and reforming the patent process.


        The President’s 2012 Budget includes $12.057 billion for the Department of the Interior (DOI), which is about the same as the $12.086 billion projected for FY11 under the CR.

Bureau of Land Management

        About $1.132 billion is requested to fund BLM for FY 2012, a bit less than the $1.156 billion in actual FY10 spending.

        Oregon and California Grant Lands – $112,043,000 is requested for the management of these lands, about the same as that requested in FY10.

        Payments to Nevada from receipts on land sales – The Budget documents state that the Secretary is authorized by law to sell not more than 700 acres of public lands per calendar year in and around Las Vegas, Nevada, the proceeds of which are to be used to acquire environmentally sensitive lands in the Lake Tahoe Basin of California and Nevada.

        Forest Ecosystem Health and Recovery Fund – Funds in this program can be used for the purpose of planning, preparing, implementing and monitoring salvage timber sales and forest ecosystem health and recovery activities, such as release from competing vegetation and density control treatments. The Federal share of receipts derived from treatments funded by this account are to be deposited into the Forest Ecosystem Health and Recovery Fund. $4 million in new obligations is requested in FY12, down from the $6 million requested in FY10.

Bureau of Reclamation

        The Budget proposes $1.051 billion in funding for the Bureau of Reclamation, down from the $1.140 billion in actual FY10 funding. This account supports the development, management, and restoration of water and related natural resources in the 17 Western States.

        CALFED – The Budget request for CALFED funding for FY12 is $39.65 million, about the same as the FY11 request of $40,000,000. Total federal funding for CALFED related projects, and a detailed list of those projects, across all federal agencies can be found under the California Bay-Delta Restoration Fund link at: http://www.usbr.gov/budget/2012Budget.pdf .

        Central Valley Project Restoration Fund – The Budget proposes about $53 million in CVP funding for FY12. Resources are derived from donations, revenues from voluntary water transfers and tiered water pricing. The account is also financed through additional mitigation and restoration payments collected on an annual basis from project beneficiaries.

        San Gabriel Basin Restoration Fund – No additional budget authority is proposed for the Fund, compared to the $4 million available under the FY11 CR. The available amounts in this fund will be used to design, construct, operate and maintain water quality projects to remediate contamination of groundwater in the San Gabriel and Central Basins of Southern California, contingent on receipt of local cost share.

        San Joaquin Restoration Fund – The budget expects $9 million to be available in FY12. FY2012 budget authority is estimated to be $33 million. This fund receives funding (user fees and repayment receipts) from the Friant Division long- term contractors and other Federal and non-Federal sources to implement the provisions described in the Settlement (Settlement) for the National Resources Defense Council (NRDC) et al. v. Rodgers lawsuit. The Settlement’s two primary goals are: 1) To restore and maintain fish populations in “good condition” in the main stem of the San Joaquin River below Friant Dam to the confluence of the Merced River, including naturally reproducing and self-sustaining populations of salmon and other fish; and 2) To reduce or avoid adverse water supply impacts to all of the Friant Division long-term contractors that may result from the Interim Flows and Restoration Flows provided for in the Settlement.

Fish and Wildlife Service

        The Budget proposes about $1.695 billion in FY12 funding, roughly the same as the $1.651 billion in actual FY10 funding.

National Park Service

        The FY11 request is for $2.922 billion, compared to the FY10 funding of $2.781 million.


        The Budget requests $553.04 billion in discretionary base budget authority for the Department of Defense. FY10 funding was $530.1 billion.

        Research & Development – The Budget proposes $75.325 billion for research, development, test and evaluation, including $12.2 billion for early stage science and technology programs. FY10 actual spending was $80.140 billion.

        Weapon Systems – The Budget requests $113 billion to continue to procure advanced weapons systems and other equipment, including $9.7 billion for the F-35 Joint Strike Fighter.


        The Budget includes a total of $29.5 billion in funding for DOE, a 12 percent increase over the 2010 enacted level. This reflects increases in the Administration’s priority areas such as clean energy, nuclear security, and research and development. Savings are achieved through cuts to fossil energy programs.


        The Budget proposes $5,416,114,000 for the Science account, compared to $4,964,000,000 in FY10 funding, about a 9% increase over the Continuing Resolution level .

        Basic Energy Sciences is funded at $1.985 billion, compared to about $1.6 billion in FY10 funding.

        Fusion Energy Sciences

        The Budget proposes about $400 million for Fusion Energy Sciences, roughly a 6% decrease from the current FY 2010 funding level. Within the FY12 request, $105M is for the U.S. ITER Project. The base program includes increases for operations at DIII-D and C-MOD, international research, general plasma science, material research and SciDAC and also includes funding for the NSTX upgrade. Decreases are made to the ICC, FSP (which is taken down to zero), MST operations, GPE/GPP/Infrastructure, and Plasma Technology. There is no new initiative for IFE included in the budget.

        Electricity Delivery and Energy Reliability

        The Budget proposes $237,717,000 for the program. The mission of the Office of Electricity Delivery and Energy Reliability (OE) is to lead national efforts to modernize the electric grid, enhance security and reliability of the energy infrastructure, and facilitate recovery from disruptions to the energy supply. This Office undertakes a number of efforts to achieve this, including research, development, demonstration and technology transfer in areas such as smart grid, energy storage, transmission reliability, and cyber security of the electrical system; implementation of the electricity grid modernization requirements.

        Advanced Research Projects Agency-Energy (ARPA-E)

        The budget requests a total of $550 million for the Advanced Research Projects Agency-Energy (ARPA-E), as established by the America COMPETES Act.

        Better Buildings Pilot Loan Guarantee Initiative for Universities, Schools, and Hospitals

        The Budget proposes legislation to authorize a pilot loan guarantee program to provide $100 million for guaranteed loans for energy efficiency retrofits of universities, hospitals, and schools. The funding would subsidize total loan principal, any part of which is to be guaranteed, not to exceed $2,000,000,000. This “Race to Green Initiative” proposes to reduce energy usage in commercial buildings by 20 percent by 2020. It proposes a grant competition and a pilot program to provide retrofit loan guarantees that will focus on universities and hospitals. These programs are to complement an expanded and redesigned tax incentive for commercial building upgrades.

Elk Hills School Lands Fund

        The Budget proposal indicates that under the settlement agreement, $300 million has been paid to the State of California. There is no request for funding in FY 2012. The timing and levels of any future budget request are dependent on the schedule and results of the equity finalization process.


        The Budget proposes to give the U.S. Patent and Trademark Office (USPTO) full access to its fee collections and strengthen USPTO’s efforts to improve the speed and quality of patent examinations through a temporary fee surcharge and regulatory and legislative reforms. The Administration believes that the surcharge will better align application fees with processing costs. In total, this will provide USPTO with more than $2.7 billion in resources in 2012, or more than 34 percent above 2010 levels.


        The Budget provides $4.6 billion, a reduction of $913 million from the 2010 level. The Budget proposes to create savings and efficiencies through the elimination of what the Administration considers duplicative and lower-priority programs including Corps funding of local water and wastewater treatment projects.

        The Budget also proposes to cancel $57 million of prior year funding, of which $35 million was provided through an emergency supplemental appropriation.

        New federal funding in the Civil Works budget consists of $3.753 billion from the general fund, $758 million from the Harbor Maintenance Trust Fund, $77 million from the Inland Waterways Trust Fund, and $43 million from Special Recreation User Fees.

        The FY12 funding distribution includes:

        – $2.314 billion for Operation and Maintenance

        – $1.48 billion for Construction

        – $104 million for Investigations

        California Projects

        For funding levels for specific California projects, go to Page 11 of

http://www.usace.army.mil/CECW/PID/Documents/budget/budget2012.pdf .


        The President’s Budget provides about $9 billion for the Environmental Protection Agency, compared to $10 billion estimated for FY11 under the continuing resolution.

        Water State Revolving Fund (SRF)

        The Budget reduces funding for the Environmental Protection Agency’s water infrastructure State Revolving Funds by $950 million and adjusting future year requests through 2016 with the goal of providing, on average, approximately 5 percent of total annual water infrastructure spending.

        The Budget documents state: “As part of the Administration’s long-term strategy, the Environmental Protection Agency is implementing a Sustainable Water Infrastructure Policy that focuses on working with States and communities to enhance technical, managerial, and financial capacity. Important to the technical capacity will be enhancing alternatives analysis to expand “green infrastructure” options and their multiple benefits. Future year budgets for the SRFs gradually adjust, taking into account repayments, through 2016 with the goal of providing, on average, about 5 percent of water infrastructure spending annually. When coupled with increasing repayments from loans made in past years by States the annual funding will allow the SRFs to finance a significant percentage in clean water and drinking water infrastructure. Federal dollars provided through the SRFs will act as a catalyst for efficient system-wide planning and ongoing management of sustainable water infrastructure. Overall, the Administration requests a combined $2.5 billion for the SRFs.”


        Drinking Water State Revolving Fund

        The Budget provides $990 million for the Drinking Water SRF, compared to the enacted 1.4 billion in FY10.

        Science and Technology

        The proposed Budget includes $826 million, as compared to 46.7 million in last year’s request for the Science and Technology account. This program finances the activities that provide the scientific and technology basis for EPA’s regulatory actions.

        State and Tribal Assistance Grants

        The proposed Budget provides $1.2 billion for State and Tribal Assistance Grants, compared to $1.1 billion enacted for FY10.


        EPA will allocate $99 million for Brownfields Assessment and Cleanup, compared to the estimated $100 million in FY10.


        The Budget funds the Hazardous Substance Superfund at $1.2 billion, a slight decrease from FY10.


        The budget proposes $18.7 billion, the same amount the agency received in 2010. The Budget also proposes to streamline operations and boost efficiencies at facilities.


        The budget provides $7.8 billion for the National Science Foundation, an increase of 13 percent above the 2010 enacted level. Investments are made in areas that contribute to the President’s Plan for Science and Innovation. Savings are also created by reducing funding for low-performing and lower-priority education and research programs. The President also provides $998 million for a cross-agency sustainability research effort focused on renewable energy technologies and complex environmental- and climate-system processes.


        The administration’s Budget provides $985 million, a 45 percent decline from 2010 enacted funding, which included $962 million in supplemental appropriations. Excluding supplemental funding, the 2012 request is $161 million higher, primarily due to increased estimated credit subsidy costs. Funding for administrative costs and Small Business Development Centers will go down as a result of fiscal restraints.

        Loan Guarantees

        The budget supports $27 billion in loan guarantees for small businesses to enable them to invest, expand, and create jobs.

        Office of Inspector General

        The 2012 Budget proposes $18.4 million in new budget authority and $1.0 million transferred from the Disaster Loans Program account for a total of $19.4 million for the Office of Inspector General (OIG). This appropriation provides funds for agency-wide audit, investigative, and related functions to promote economy and efficiency in SBA operations and to prevent and detect waste, fraud, and abuse. In addition, the passage of the American Recovery and Reinvestment Act of 2009 provided an additional $10 million, available from 2009 through 2013, for oversight and audit of SBA Recovery Act programs, grants, and projects.


        The President’s Budget calls for numerous changes in the tax code, including the following:

        – Proposes a 3-year extension to AMT relief that is paid for by an across-the board

30 percent reduction in itemized deductions for high-income taxpayers

        – Reduce itemized deductions – The Administration proposes to limit the tax rate at which high-income taxpayers can take itemized deductions to a maximum of 28 percent, affecting only married taxpayers filing a joint return with income over $250,000 (at 2009 levels) and single taxpayers with income over $200,000. The proposed limitation would be effective for taxable years beginning after December 31, 2011.

        – Enhance and make permanent the R&E tax credit – A tax credit of 20 percent is provided for qualified research and experimentation expenditures above a base amount. An alternative simplified credit of 14 percent is also provided. These tax credits, which are scheduled to expire with respect to expenditures paid or incurred in taxable years beginning after December 31, 2011, are proposed to be permanently extended. The Administration also proposes to raise the rate of the alternative simplified credit to 17 percent.

        – Extend American opportunity tax credit (AOTC) – The AOTC provides taxpayers a credit of up to $2,500 per eligible student per year for qualified tuition and related expenses (expanded to include course materials) paid for each of the first four years of the student’s post-secondary education in a degree or certification program. The Administration proposes to permanently extend the AOTC and index the expense amounts and phase out limits, effective for taxable years beginning after December 31, 2012.

        – Tax qualified dividends and net long-term capital gains at a 20-percent rate for upper-income taxpayers – The Administration proposes to tax net capital gains and qualified dividends at a 20-percent rate for married taxpayers filing a joint return with income over $250,000 (at 2009 levels) and for single taxpayers with income over $200,000. The 18-percent capital gain rate on assets held over five years would be repealed, but special rates on gains from the recapture of depreciation on certain real estate, collectibles, and small business stock would be retained. The proposal would be effective for taxable years beginning after December 31, 2012. All other taxpayers would be taxed at the rates in effect in 2012.

        – Provide additional tax credits for investment in qualified property used in a qualified advanced energy manufacturing project – Currently a 30-percent credit is provided for investment in eligible property used in a qualified advanced energy manufacturing project. A qualified advanced energy manufacturing project re-equips, expands, or establishes a manufacturing facility for the production of a range of innovative energy technologies, including the production of energy from the sun, wind, or other renewable resources, and electric grids to support the transmission of intermittent sources of renewable energy, including the storage of such energy. The total amount of credits currently certifiable may not exceed $2.3 billion. The Administration proposes to provide an additional $5 billion in credits, thereby increasing the amount of credits certified by the Department of the Treasury to $7.3 billion.

        – Reform and extend Build America bonds – The Administration proposes to make the Build America bond program permanent at a reduced subsidy level designed to be approximately revenue neutral in comparison to the Federal tax losses from traditional tax-exempt bonds. The Administration also proposes to expand the Build America bond program beyond new investments in governmental capital projects to include certain additional program uses for which State and local governments may use tax-exempt bonds under existing law. The proposed modifications to the Build America bond program would be effective for bonds issued beginning upon the date of enactment.

        Designate Growth Zones – The Administration proposes to designate 20 growth zones (14 in urban areas and 6 in rural areas). The zone designation and corresponding incentives would be in effect from January 1, 2012, through December 31, 2016. The zones would be chosen through a competitive application process based on the strength of the applicant’s “competitiveness plan,” economic indicators, and other criteria. Two tax incentives would be applicable to growth zones. First, an employment credit would be provided to businesses that employ zone residents that would apply to the first $15,000 of qualifying wages annually. The credit rate would be 20 percent for zone residents who are employed within the zone and 10 percent for zone residents employed outside of the zone. Second, qualifying property placed in service within the zone would be eligible for additional first-year depreciation of 100 percent of the adjusted basis of the property. Qualifying property would generally consist of depreciable property with a recovery period of 20 years or less.

        – Reinstate Superfund taxes – The Administration proposes to reinstate the taxes that were deposited in the Hazardous Substance Superfund prior to their expiration on December 31, 1995.

        – Make unemployment insurance (UI) surtax permanent – The net Federal UI tax on employers is scheduled to drop from 0.8 percent to 0.6 percent with respect to wages paid after June 30, 2011. The Administration proposes to extend the 0.8 percent rate permanently.

        – Provide short-term tax relief to employers and expand Federal Unemployment Tax Act (FUTA) base – The majority of states have been forced to borrow to continue paying unemployment insurance benefits. These debts are now being repaid through additional taxes on employers. To provide short-term relief to employers in these States, the Administration proposes a suspension of interest on State UI borrowing in 2011 and 2012 along with a suspension of the FUTA credit reduction, which is an automatic debt repayment mechanism. The Administration also proposes to increase the FUTA taxable wage base to $15,000 starting in 2014, to index it to inflation, and to reduce the FUTA tax rate.