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HUMAN
SERVICES
DEPARTMENT OF HEALTH & HUMAN SERVICES
Chief of Staff
MEALTH
8
Washington, D.C. 20201
Memorandum to Melanne Verveer
Shilley
From:
Mary Beth Donahue MED
Chief of Staff
Subject:
Addendum to the 1999 State of the Union proposals
The Department of Health and Human Services (HHS) provided a memorandum to you on
November 20 outlining proposed thematic ideas for the 1999 State of the Union address. I am
writing as a follow-up to that memorandum to request that an addendum to this document be
considered.
Please find attached, a paragraph regarding Enacting Federal Privacy Legislation. We propose
that this paragraph should be included in the November 20 document within the section entitled,
"Improving the Health of All Americans". You will note that within this section we highlight
concrete steps that the Administration can take to improve the health care system. We suggest
that the addendum be inserted following the paragraph on Enacting a Patients Bill of Rights.
For your reference, I have attached a copy of the comprehensive memorandum forwarded to you
on November 20.
Thank you for taking the time to consider this request. If you have any questions, please feel free
to contact me at 202-690-7431.
ATTACHMENTS
Addendum to November 20 document
Copy of the November 20 document
Add to Section II, page 4, just after the "Enact a patients Bill of Rights" section:
Enact Federal Privacy Legislation: The American people expect, and are entitled to,
confidential, fair, and respectful treatment of their health information. Over a year ago, Secretary
Shalala sent a Report to the Congress recommending that the Congress enact legislation
requiring that treatment. Since then, progress in crafting such legislation has been made by both
Republicans and Democrats. Now its time to get serious about protecting the privacy that we in
the United States cherish as essential to personal freedom and well-being. The need for such
legislation is found in the rapid changes in the ways that health care is provided, documented,
and paid for in the United States. These changes pose a challenge to American values that are
both complementary and competing. On the one hand, patients have a legitimate need for
confidentiality so that they can be frank with their physicians about their health conditions and
behavior. That assurance is fundamental to effective diagnosis, treatment and healing. On the
other hand, participants in the health care system -- insurers, governments at all levels, managed
care organizations -- have legitimate needs for access to health records in serving patients and
performing their roles in the system. Our challenge is to work together to balance these
competing values.
THE SECRETARY OF HEALTH AND HUMAN SERVICES
WASHINGTON, D.C. 20201
USA
NOV 20 1998
MEMORANDUM TO BRUCE REED AND GENE SPERLING
FROM:
Donna E. Shalala Discul
Secretary of Health and Human Services
As you begin to prepare for the 1999 State of the Union Address, I want to share with you some
thematic ideas to stress the accomplishments of the Administration and its agenda for further
improving the health and welfare of the American people. I strongly believe that these issues
have wide public support and can form the basis for some bipartisan progress in Congress. They
build on our past accomplishments and will help to ensure a long-lasting legacy for the
Administration in the area of improving the quality of life for the American family. My staff
will be happy to work further with you and other White House staff on the details of these
proposals.
In the President's speech in Poland, he quoted an ancient Irish proverb: "May you live a hundred
years." In the 20th Century, medical, scientific and public health breakthroughs have added 20
years to the average life expectancy of the American people. The President should declare a
national goal of meeting or exceeding this accomplishment in the new century to come so that by
the end of the 21" Century, the average life expectancy of an American can be nearly 100 years.
Imagine what such an accomplishment will mean to the productivity and creativity of our people
and our nation.
In that light, this memorandum lays out four major themes for the President's address:
Helping Working Families Help Themselves: This includes renewed efforts to improve child
care and support working families and new initiatives in the area of long-term care.
Improving the Health of All Americans: This includes enacting a Patients' Bill of Rights and
continuing our efforts to eliminate historical racial and ethnic disparities in health status,
particularly those disparities affecting American Indians.
Making the World Safer for Children: This includes a renewed effort to combat tobacco use
by children as well as new initiatives to reduce the number of accidental injuries and a
new effort to combat the rising prevalence of asthma in children.
Improving Public Health Capacity: This includes continuing efforts to protect the safety of
our food supply, countering the threat of bioterrorism, and ensuring the safety of drugs,
medical devices, and the blood supply.
The following pages of this memorandum discuss each of these themes in greater depth and offer
rhetorical language that might fit within the context of the State of the Union Address.
1
I.
Helping Working Families Help Themselves
The American family is stronger and more able to deal with the unexpected today thanks to the
far-sighted policies we have adopted during these last six years. The Family and Medical Leave
Act allows working parents to spend the time they need with a newborn or sick child. A higher
minimum wage, the expanded Earned Income Tax Credit, and the $500 child care credit have
helped to lift working families out of poverty. Parents can move from job to job without
worrying that their health insurance won't move with them. More pre-school children are fully
immunized than at any time in our history. And more than two million additional children have
health insurance that will help them to grow up healthy and strong.
But our work is far from complete. Today, too many parents still must worry that they cannot
afford quality child care for their children. Too many families are adversely affected by
substance abuse problems. And too many families worry that the cost of long-term care could
wipe out a lifetime of savings. That is why I am so pleased to announce that my fiscal 2000
budget includes a series of initiatives designed to help working families help themselves.
Quality Child Care: We must make child care more affordable, more accessible, and of
consistently high quality. We know that 70 percent of today's mothers depend on child care
professionals to help them care for and educate their children. Currently, only one in ten families
eligible to receive assistance for child care do so. And in three-quarters of our states, families
living in poverty are ineligible for child care assistance. Last year, the First Lady and I hosted the
historic White House Conference on Child Care. We know that the early years of life are critical
to the development of children's brains and their ability to enter school ready to learn. We also
know that the experiences that older children have in non-school hours are critical to their
positive development and education. There is no better investment of our resources than
assuring that our children grow up in safe and healthy learning environments. We need to make
sure that mothers and fathers who hold jobs outside the home are secure in the knowledge that
their children are being cared for in high-quality child care facilities. So let's finish the job and
enact a child care bill that helps parents get their kids off to the right start.
Working Families Initiative: In the two years since I signed the welfare reform law we have
made remarkable progress in helping families move from welfare to work and in supporting
working families. The welfare rolls are at an historic low and our employment rates are at an all-
time high. But it is clearly not enough to just help families find jobs. We must keep them out of
poverty by again raising the minimum wage. We need to build secure and reliable supports for
work, such as Food Stamps, child care, health care, housing, and transportation. And we must
help them improve their education and skill development.
Substance Abuse: We must strengthen our efforts to assist families whose substance abuse
problems threaten their ability to lead healthy and productive lives. More than 8 million children
in our nation are now living in families where at least one parent has a serious alcohol or drug
problem, and drug use rates among our young have recently been rising. Indeed, research tells us
2
that the children of substance abusers are at higher risk of developing such problems themselves.
Under the leadership of General Barry McCaffrey, the Office of National Drug Control Policy
has developed a comprehensive, long-term drug control strategy for our nation. This strategy
lays out a road map for making treatment and prevention services more available to parents and
their children. You have all seen the ads on TV. These are the first steps in raising awareness,
changing attitudes, and getting families and children to take action. Through the budget process
we are also moving to reduce the treatment gap, so that families will be able to get the treatment
they need. Through these efforts, we are providing the tools that working families need so that
they can address their alcohol and drug problems and provide healthy family environments for
their children.
Long Term Care: Last year's budget made an unprecedented investment in medical research
and my budget for this year keeps us on a path of doubling the NIH budget in five years. These
investments will help us to unlock the mysteries of the human body and help to extend the length
and quality of every human life. But we also must recognize that longer lives will increase our
need for innovative ways to care for our parents and our grandparents. Every year over 50
million Americans spend time caring for sick and disabled family members and friends. They
struggle to keep their loved ones at home for as long as possible. Yet they get remarkably little
help in doing SO. That is why I am proposing to establish a National Family Caregiver Program
to help these heroic men and women care for their loved ones and why I am also proposing a new
Bridge to Independence Initiative that will work to expand the availability of home and
community-based care for the elderly and the disabled.
Today, more than four million Americans are living with Alzheimer's disease, including
President Reagan. That number is projected to quadruple in the next 40 years. That is why my
budget also includes funding for Alzheimer's disease research.
II.
Improving the Health of All Americans
Our nation has the best health care system in the world. We have the best doctors, the most
advanced technology, and the most exciting research. But we can make the American health care
system even better.
Enact a Patients Bill of Rights: Quality health care should not be a partisan issue. Quality
health care is a practical issue for patients and their families. The first task of this new Congress
must be to finish the work we began last year and enact a Patients' Bill of Rights that will
guarantee high-quality care for all Americans. Virtually every member of this body sponsored
legislation to provide Americans with a Patients Bill of Rights. There were many very real issues
that divided us in 1998, but these are not issues that should stop us from acting. We must
provide Americans with a real choice of doctors, with real access to specialists, and with real
emergency care when and where they need it. They must be able to take their disputes with their
health plans to independent, external experts for a binding final decision. They must know that
their medical records are secure. And they must be able to have recourse against health plans
3
that injure them or their loved ones.
Eliminate Racial Disparities in Health Status: For too long our nation has seen shocking gaps
between the health of white Americans and that of African Americans, Hispanics, Asian
Americans, American Indians and other racial and ethnic minorities. Last year, we began a
national initiative with the bold goal of eliminating these shameful disparities by the year 2010 in
six critical areas of health status: infant mortality, cancer screening and management,
cardiovascular disease, diabetes, HIV/AIDS infections, and child and adult immunizations. We
also launched a national effort to deal with the crisis that HIV and AIDS present to minority
communities. I propose doubling our efforts in these areas so that the health of any American
does not depend on the color of their skin.
Improve the Health of American Indians and Alaska Natives: While we work to improve the.
health of communities of color we must pay particular attention to the needs of the oldest
American communities - American Indians. For far too long, these Native Americans have been
accorded second-class status. We must enter the next millennium by making a national
commitment to meet our legal and moral obligations to these citizens. We must provide health,
education, and economic opportunities that will make the first Americans as economically
productive, educationally competitive, and as healthy as those who followed them to these
shores. We have begun by assisting tribal nations to develop innovative approaches that
encourage community-based solutions for health status disparities effecting Indian families and
communities.
III.
Making the World Safer for Children
If parents are to have the opportunity to raise healthy children, we have the obligation to make
the world around them as safe as possible. Every day, parents struggle to raise their children in
an environment that nurtures their bodies and their souls. We can't do that job for them, but we
can make it easier for them to do it successfully.
Reducing Tobacco Use: We have fundamentally changed our understanding of smoking. There
can be no debate that the nicotine in cigarettes is addictive. We know that smoking is a pediatric
disease. Three thousand young people become regular smokers each day and nearly one
thousand of them will die prematurely. No legal obfuscation by the industry, nor slick TV ads
can fool the American people. They know the truth - often from the industry's own data. If
Congress wants to act, we will work with them. Science and common sense lead to the
conclusion that a strong, comprehensive approach to the problem is best. But we will not wait on
Congress. Any state, any community that wants to act on the knowledge and facts of this public
health threat will have this Administration's full support.
Reducing the Incidence of Injuries: More than 400 Americans - including 50 children - die
every day from preventable injuries and thousands more are injured every year, suffering
permanent disabilities. Such injuries cost our society $224 billion a year in lost productivity,
4
health care and rehabilitation costs. Yet every dollar we invest in preventing injuries saves us
millions. For example, smoke alarms save $69 for every $1 spent, bicycle helmets save $29 for
every $1, and child safety seats save $32 for every $1. We need to make Americans safe at home,
safe at school, safe at work, and safe as they move about in their communities. That is why my
budget includes money to help protect our children by creating a safer environment in which they
can grow and mature.
Fighting Asthma: Over the last 15 years, the number of Americans afflicted with asthma
has doubled to more than 15 million and the largest increases have been among children.
In fact, asthma is one of the leading causes of school absenteeism and a major reason for
emergency room visits by parents and young children. Our investment in asthma research
has increased our understanding of the root causes of this condition. Now it is time to invest
in getting that information in the hands of doctors and their patients. My budget will help
prevent the onset of asthma, help parents manage asthma in their kids, and improve the
treatment of this manageable disease.
IV.
Improving Public Health Capacity
If we are to protect our nation and our planet against disease in the new century, we
must continue to build our public health infrastructure. Without a solid and stable system of
public health, we cannot fight the threats we know and we cannot be prepared for those that we
don't know. Working in partnership with the states, we must develop and maintain a rapid
response approach to contain the outbreaks of the future. This investment will enable us to
increase the number of trained scientists and public health professionals in our communities.
Food Safety: With bipartisan support we have made major progress toward making our nation's
food supply as safe as possible. The CDC has established a nationwide surveillance network that
alerts us to any threats to the food supply. This allows us to quickly identify and act on
foodborne outbreaks anywhere in the country. We have instituted new agricultural practices
designed to detect and prevent contamination of fruits and vegetables. And we are
taking measures to reduce the potential for bacteria contamination by applying new scientific
approaches to assure the safety of fruit juices. To make all of this work, I have directed that a
national food safety council be established to monitor food safety and help us maintain a safe
national food supply.
Drug Safety: By assuring the quality of the drugs we take, the medical devices we need, and
the blood supply upon which we rely, we relieve a major source of concern for the people of
this nation and others. Our new FDA Commissioner Jane Henney will work closely with you
to implement the bipartisan FDA reform bill that I signed in the last Congress.
Fighting Bioterrorism: Ensuring the health and well-being of our citizens requires thinking
the unthinkable and preparing accordingly. That is why I am requesting $370 million to
enhance our ability to protect the American people against terrorism involving infectious
5
microorganisms. We will help state and local health departments and the Centers for Disease
Control and Prevention improve their capabilities to detect unusual infectious-disease outbreaks
that might be caused by terrorists. We will also strengthen local, state, and national capabilities
to mount rapid medical responses to such incidents. Our overarching goals will be to prevent
bioterrorism whenever we can and, when we can't, to limit the toll of death and suffering that those
heinous crimes can inflict upon our communities.
Attachment
Tab A - Background Information on the Health Status of American Indians and Alaska Natives
6
TAB A
Background Information on the Health Status of American Indians and Alaska Natives
Focus on the Tools of Opportunity. Develop economic
opportunities in Indian communities, raise the health status of
Indian people and their communities, and improve their
educational status.
Health Status. American Indians and Alaska Natives have the
lowest life expectancy of any group in the nation and
disproportionately higher morbidity/mortality rates than the
total population, as shown below.
Alcoholism
579% greater
Tuberculosis
475% greater
Diabetes
231% greater
Unintentional Injury
212% greater
Suicide
70% greater
Pneumonia and Influenza
61% greater
Homicide
41% greater
Gastrointestinal Disease
23% greater
Heart Disease
8% greater
The health of Indian people is measurably different than other
Americans at all life stages. Indian infants die from sudden
infant death syndrome at a rate 1.8 times the U.S. All Races
infants rate of 2.1. Indian children, 5-14 years, die of
traumatic injuries at twice the U.S. All Races rate, and suicide
among Indian children, 15-24 years, is 2.7 times the U.S. All
Races rate. The alcoholism death rate for Indian youth, 5-14
years, is over 17 times the rate for U.S. All Races. One in
three adult Indians suffer from diabetes -- nearly twice the
rate of U.S. All Races. Indian elders still die earlier than
their U.S. All Races counterparts. American Indian and Alaska
Native homes. lack safe water and sanitary means of waste
disposal 7.5 times that of homes of U.S. All Races.
Eliminate Health Disparities for Six Target Areas. The
Administration's Initiative to Eliminate Racial and Ethnic
Disparities in Health targets six areas: diabetes, heart
disease, cancer screening and management, HIV/AIDS, infant
mortality, and immunization.
Develop Economic Opportunity. Disparities exist in other
programs aimed at improving the social and economic status of
low-income and disadvantaged populations, including TANF and
other ACF programs and Medicaid/CHIP outreach. This is the case
for both reservation-based and urban-based American Indians and
Alaska Natives. This is not just a reservation issue.
Sixty-five percent of Indian people live in urban or suburban
areas. Indian people are the most disadvantaged population in
the nation. Their median household income (1989) was $19,897
compared with $31,435 for Whites, $19,758 for Blacks, and
$24,156 for Hispanics.
Living Below the Poverty Level
31.6%
Males 16 & Over Unemployed
16.2%
Bachelor's Degree or Higher, Ages 25 and older
8.9%
Improve the Academic Performance of American Indians and Alaska
Native Students. Census data show that the Indian population
has increased in the last three decades. Of the total Indian
population, the age group 10-19 years represents a significant
concentration. There are approximately 600,000 American Indian
and Alaska Native children in the United States -- less than 1%
of all school-aged children. They have the highest dropout rate
in the nation. Thirty-six percent of American Indian and Alaska
Native tenth graders drop out of school, more than twice the
national percentage for white students. Thirty-two percent of
American Indian and Alaska Native students showed a "below
basic" level of performance in math, which represents twice that
for white students (15.5%): Twenty-two percent of white
students showed an "advanced" level of performance in math,
which is almost five times that for Indian students (4.8%). The
Bureau of Indian Affairs funds a K-12 educational program for
51,000 Native Americans in 185 school systems in 23 states. Of
the 3,000 facilities in the BIA school system, 25 percent are
more than 50 years old, 50 percent are more than 30 years old,
and 3 percent are more than 100 years old. Twenty thousand
American Indian and Alaska Native students attend classes in
portable classrooms. The conditions of these facilities reflect
significant operational and new school construction needs. The
turnover rate for BIA teachers is 35%.
The White House Domestic Policy Council Working Group on
American Indians and Alaska Natives approved a Policy Initiative
for Indian Children and Adolescents as proposed by the IHS in
1997. The Policy Initiative focuses on directing resources from
a number of Federal agencies and private sources. The Policy
Initiative's intent is to improve the conditions and quality of
life for American Indian and Alaska Native children and
adolescents and help them become healthy adults. The IHS will
continue to work with the Domestic Policy Council by providing
additional information about the potential outcomes of the
Initiative and other basic information on the status of Indian
children and youth. The IHS will continue to pursue a potential
presidential Executive Order or other administrative policy
statement in support of Indian children and youth. In addition,
the IHS is planning the development of a major campaign in 1999
that will address the need for establishing healthy lifestyle
programs for Indian youth. Tribal consultation will be a
cornerstone of this campaign.
Continue the Momentum of Past Progress. The Administration has
made progress on American Indian and Alaska Native health issues
even though significant disparities remain. Mortality rates for
American Indians and Alaska Natives have decreased significantly
in many areas since 1973, as shown below, showing that investing
in Indian health works!
Tuberculosis
79% reduction
Gastrointestinal Disease
76%
reduction
Maternal Deaths
68% reduction
Infant Deaths
58% reduction
Unintentional Injury
56% reduction
Pneumonia and Influenza
52% reduction
Homicide
40% reduction
Alcoholism
37% reduction
Suicide
23% reduction
11/25/98
17:02
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456
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Shirly
CENTER ON BUDGET
AND POLICY PRIORITIES
FMI
To:
Maria Echaveste
Ron Klain
Jack Lew
John Podesta
Bruce Reed
Gene Sperling
Larry Stein
Melanne Verveer
From:
Bob Greenstein
Date:
November 24, 1998
Subject:
Legal immigrants, the FY 2000 budget, Hispanic and Asian voters, and
the 2000 elections
In 1997 and 1998, the Administration won important victories in restoring
benefits for legal immigrants that had been taken away by the welfare law.
Nevertheless, substantial parts of the damage done to legal immigrants by the welfare
law remain. Prior to November 3, I thought it unlikely the Administration could win
more restorations in this area. Now, I think there is a strong chance you could win
more here.
Since the election, newspapers have run a spate of articles discussing the pivotal
role of the Hispanic vote on November 3. Republican strategists such as Ralph Reed
are quoted as saying Republicans must do better with such voters, while news analyses
note that anti-immigrant stands have hurt Republicans badly in California. Articles
also report that 30 percent of the Hispanic electorate in California consisted of newly
naturalized citizens voting for the first or second time. In fact, USA Today has reported
that newly naturalized citizens tend to have higher turn-out than other voter groups.
The articles also point out that Republicans who did well with Hispanic voters won by
large margins.
This suggests that if the President's FY 2000 budget contains significant
immigrant restoration proposals and the Administration pushes for them, Republicans
may feel they have to give you something in this area. And if they do not and turn
down your proposals, then Democrats and Vice President Gore should be able to use
that to remind Hispanic and Asian voters in 2000 of the differences between the parties.
In short, this appears to be a "win-win" situation. Either further restoration will be
achieved, or the rejection of Administration proposals in these areas can serve as a
820 First Street, NE, Suite 510, Washington, DC 20002
upd
Tel: 202-408-1080 Fax: 202-408-1056 [email protected] http://www.cbpp.org HN0026
11/25/98
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NO.660
P002/006
wedge issue with some key voting constituencies. I urge you to include immigrant
restorations in the budget, as you have done each of the past two years.
The major constituency organizations that work on these issues are preparing a
memo for the Administration on their priorities in this area; a number of these priorities
were included in your FY 1998 or FY 1999 budgets. Key areas where the Administration
could propose important restorations include the following:
Give states the option to provide coverage under Medicaid and the child
health block grant to low-income legal immigrant children who have
entered the United States after August 22, 1996, the date the welfare law was
signed. States now are barred from extending such coverage. This proposal
was in the Administration's FY 1999 budget.
Give states the option to provide prenatal care to legal immigrant pregnant
women who have arrived after August 22, 1996. States must provide
Medicaid coverage for delivery costs when such women give birth but are
prohibited from providing Medicaid coverage for prenatal care, which can
result in healthier birth outcomes. This makes little sense.
Provide SSI eligibility to legal immigrants who enter the country after
August 22, 1996 and become disabled after arriving here. Should a poor
legal immigrant hit by a bus or maimed in a workplace accident be denied
SSI? The Administration fought for this in 1997 but didn't win it. Let's join
this fight again.
Provide SSI for legal immigrants here on August 22, 1996 who subsequently
become elderly and poor. The 1997 restoration limits SSI to those elderly
legal immigrants who were both 65 or older and on the SSI rolls on August
22, 1996. This is too restrictive. At a minimum, we should cover those who
were in the U.S. and 65 or older on August 22, 1996 but not on the SSI rolls
on that date. Current rules in this area penalize elderly legal immigrants
who worked as long as they could and stayed off SSI as long as they could
- and consequently weren't receiving benefits on August 22, 1996 - but
who since have become poor. Fixing this would simply conform the
treatment of elderly legal immigrants in SSI to the food stamp treatment for
elderly legal immigrants the Administration won this June.
Extend food stamps to poor legal immigrant parents here on August 22,
1996, or at least to working poor immigrant parents. Currently, children in
these families can get food stamps, but their parents can't. The result is that
the family as a whole, including the children, often does not have enough to
eat. The primary people who would be covered under this proposal are
individuals who came here legally, are working, and are trying to raise their
children on below-poverty wages.
This is an area where good policy, basic decency, and politics converge. I hope
you'll include such a package in the budget.
P003/006
Core Democratic voters defy predictions
USA 11/4
Some '94 defectors
return to the fold
Hispanics prove pivotal
By Maria Pueste
USA
11/4
Charles Schumer in the no-
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USA TODAY
holds-barred brand for the
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1
tracks
the
Cal-
50h bet the doesn't -
gives right, facal conservatives
Gass of the Committee for the
greats, and of
Mersis Elspanic electorare,
they going w give a GOP
and business community.
Study of the American Elector-
firmative action.
an estimated 109 of the total
of their votes" Genzates said.
But some the mgy white
all
"Bush is going 10 Ф better
More are nurning up -
Sharp is going is get TYP
mes who Areled the 1984 Re-
Kentucky is the state where
with Latino voters then any
bellots us well Twenty-four
wi on Hapanics, and dat's $
6244
publican revolution reverted to
the Congréssional Black Can-
other white Republican in a
Happics res for sests is the
mg of maturity. I ACORS
the Democratic camp, accord-
as hunched a
statewide race ever." pre
Base, and politiers predict
they thinking,'
ing is exit polls And middle-
be our simed of Democratic
dicted Antenio Goazales,
as many as lour more seals
Another characterists of
aged voters, 44-30, turned out
voters is the clasing days of the
president of the Williams Ve
could be added to the His-
the Hespanic VOIR is the mil-
in grenter manbers then they
compaign.
Insques Institute, a think tack
pasic Couces, bringing the
304 of the HR-
did in the last mid-term elec-
AFL-CIO political director
that tracks Hispanic voters in
total an 12 Nationwide, M
electorate in Callbrais
time and voted more heavily
Steve Reseatbal said organiz-
Texas and California.
unprecedented number of
are any asteration citi-
Derucred.
ing emong the 53,000 union
in New York Premo
Hispanics - for statewide
VISION 7 the lest or sec-
Desplae predictions that the
members in Rep Ted Stick-
- - Charder -
cans and Daminicm-Ameri-
offres: 20 candidates in -
and time. These voters lend
White House ses scande) would
land's Ohio district helped the
Big furnout Voters mark their bellots Tuesday an the Adult Educa
cans helped main the differ-
states, eight in New Mexico
b here at 7 higher percell
energize Republican activists,
Democratic incumbert hold
tion Center in Anderson S.C. Poll workers of the center reported an
ence for Democrat Rep
alone. or those, 12 are Demo-
ages then other voter groups.
edt polis indicated that voting
onle his seal. Rosenthal said in
unusually high amout for a nonpresidential-year election.
participation levels by mem
bor effors also played a big
hers of the religious right was
part in the Rep Lane Even's
down, from 17% of voters in
successful effort to hold a
1984 to IF: this year.
his sout.
Nationality, MAIOR and Airi-
If Sen. Harry Reid, D-Nev.,
Dems push to the end to increase black votes
can American voter hernout
ends up holding DATE his sent,
held stendy is the face of a see
Resentball mid, it will in part be
By Jessica Lee
USA 1V4
The Democratic National Committee
In a Real burst of telephone bank
ing me to go out and vote. It made me
scandal that many predicted
due to a hage project" the
USA TODAY
(DNC) spent a record $500,000 to get
activity, Democrats put Clinton's re-
feel really special, like I could do
would discourage traditional
unions mounted to urge Their
out the vote among African-Ameri-
corded voice to work in thousands of
something for our country."
Democrets.
members to take adventage of
Democrats from President Clinica
CREA II targeted voters - key gaberna-
phone calls in states such as Califor-
The Congressional Btack Cancus
After a primary season in
. Nevada law that allows them
on down put laser facus 00 getting AF
torial and Servate races in Georgia.
nia, New York, New Jersey, Ohio,
also pushed hard Rep. Charles Ren
which voters stayed away from
to vote early by mail.
ricen-American voters to the polls
New York, Nevade and Missouri
Texas Nevade and those in the Deep
gel, D-N.Y. raised $1.3 million lov b
the pails in droves sume =
Big labor mousted its most
Early PTR polls Tuesday showed that
Their bask was a delicate one. in
South
nal throut drive.
perso feared a near election boy-
massive get-out-the-vole drive
black voters, who are about 127 of the
some states where extensive appeals
Dora Vas. an African-American
The liberal People for the Ameri-
cott - the wake of President
ever. The AFL-CIO sent as mil-
voting age population were morking
BD the interests of black voters could
who IS a legal typist in Sacramento, got
can Way's last-minute ad campaign in
Cyntes's sex-and-fies scaedal.
tion pieces of mail and made
107 of the ballots
trigger a becklesh among whites. the
a call around 5:30 p.m. Monday when
cluded a radio spot by celebrated Mri-
11/25/98
the the wase't the case, at least
5.5 million phone calls to urge
But in early returns, that 107 was
DNC and Democratic congressional
she got home from work. "At Arst I
can-Americas author Tom Morrena
not everywhere in the country.
usion members to get to the
looking big enough to break more than
campaign acted as surragates to make
thought it was a prank." she says
that was targeted to listeners of black-
"Terseul was very good,
polls. in addition, the UNIONS
one Republican redoubt in the South.
the case for Democratic victory.
"Then 1 realized il was his voice will-
owned radio stations.
particularly among misor-
disputched thousands of volue-
Wes," said Rep. Martin Frost, a
leers is an unprecedently large
Texas Democrat. "The Hispin-
grass-roofs political missionary
there's a lot a state in the elec-
races were going down to the
paige were truly "radio" BC-
the airwaves
Gary Bauer, hase of Company
k members of Congress and
effort.
times and union members will
wire, district wenther was do-
live Groups that rug the game
"We did a lot of advertising
for Verting Families, 4 politi-
black members
#
"We have found that when
vote," Rosentbal
ing nothing to bonst known
the NAACP to the Care-
on radio stations aimed at tra-
cal action committee "We
involved in turnost
we talk to
members -
la
of the astion, to
For special-Haterest eroups,
paign for Working A
ditional tamilies" mid conser-
of up la 170 different
year. They made a differ-
by one, we
make the
chading several states where
the and days of the
targeted
supporters via
vative presidential candidate
a
the
11/25/98 17:02
2024081056
202 456 6244
NO.660 P004/006
Washington Post
Washington, DC
November 16, 1998
GOP Governors Look to Wield
Stronger Hand in Party Affairs
Br DAN BALL
Washington 1001 Sinff Water
Excerpted from above article
The success of Bush in Texas and his brother Jeb.
who was elected governor of Florida in his second
attempt at the office. has attracted particular attention
among Republicans since the midterm elections.
Beyond the appeal that comes with one of the
best-known names in Republican politics. the Bush
brothers stressed what they call "compassionate
conservatism"-in contrast to the congressional
wing's harder-edged ideology.
"I think the lesson of the election is that sharp-el-
bowed conservatism doesn't work and what they offer
is a new paradigm of compassionate conservatism,"
said Marshall Wittmann of the Heritage Foundation.
Both Bushes reached gut to minority voters and
proved (ar more popular among those constituencies
than most other Republicans running this year
(Arizona Sen. John McCain, who captured a majority
of the Hispanic vote. is one exception) George W.
Bush won 49 percent of the Hispanic vote in Texas
Jeb Bush captured about 60 percent of the Hispanic
vote in Florida By way of contrast. Dan Lungren, the
Republican gubernatorial nominee in California, won
less than a fifth of the Latino vote there.
Winning minority votes, say Republican strategists,
is crucial to the party's long-term Asbirations. "II you
look at the current demographic trends, relying
exclusively on male and white voters
is
a
recipe
(or
permanent minority status." said Raiph Reed, former
executive director of the Christian Confition.
15. NOVEMBER 5. 1998
P005/006
House Seats
A House Divided
Minorities Put Democrats Over Top in Key Races
n unallerable path to taking
Narrowest 2000 century House majorities:
52 in
Ay DENNES FARNEY
MAJORITY
selective, highly competitive races.
for grabs," said Frank Sharry. executive
are Support
Stalf Register of TIN. TREAT TENAL
TEAR
PARTY
In Alabama, for example, the victorious
MARGIN
director of the National Immigration For
acrats' lurnout effort was
Minority vuters were decisive in key
Democratic candidate for governor. Don-
rum, a pro-immigration group. "And while
1917-19
Republicant
I
elections Tuesday, reclaiming center age
aid Siegelman, drew 98% of the black vote.
Mexican-Americans lean Democratic.
1y's care support armong
1923-25
Papetificana
10
from the "angry white males" who torpe-
according to exit-poll estimates. Well over
they still vote by condidate and by issues."
members and women. In the
doed Democratic hopes four years ago.
98% of the black vote in New York went to
aal weeks, every level of the
1901-33
Republicans³
Mr. Bush reached out In them. a culturally
2
This time, it was norwhites. especially
Democratic Senate candidate Charles
conservative group. by stressing family is.
olved in the elfort, from the
1143-45
Democrate
13
African-Americans, particularly in the
Schumer, who custed Republican Incum-
sues and targeting a disproportionale
the 1,000 vnlunteers who
1953-55
Republicans
I
Deep South, who spearheaded a surprising
bent Sen. Alfonse Amale. lo Blinots, De-
amount of his campaign treasury to El
1 Washington state 10 beast
Democratic resurgence. Strategists of both
moetalic Sen. Card Museley-Brawn, who is
1987-90
Pase and other Hispanic areas.
Republicana
n
ollege professor and newly
parties concluded that black voles made
an African-American, lost re-election de
Minority voters also seem to have
issman Brian Raind.
1950-99
Republicans
NP
the difference in two Senate and two gu-
spile pulling an estimated 97% of the black
longer memories In California, GOP gu-
bernatorial races in the Smith. as well as in
lysis documents their sec-
vole. In Maryland, where incumbent De
Democrate - - of - House - No
California Das Lungren. who
the New l'ork Senale race. Democratic
Regulders dualis
mocratic Cov. Parris Clendening survived
participation arrong union
lost big to Democrat Gray Davis, was hert
candidates prevailed in all five.
a lough COP challenger. the black vote
T example, jumped to 22%
- - - - Reb - -
by the stringent stand
h 13% in 1994, when the De
santy members
Motivated by Threat lo Clinion
jumped to 20% of the total this year from
taken by COP Gov. PHE Wilson In 1994.
1 country - THE . Over
he
I
The black vote obviewsly was critical
only 12% in 1984, according tn senter politi-
Meanwhile, Successful appeals to minori-
No complete mum-
cal analyst David Braills of the Joint Cen-
lies, whether by Democrals or by Republi-
i voters' turned were avail-
in the onicome of many races," White
(er for Political and Economic Studies.
House prilster Mark Penn said. "They
cam such as Cev. Bush, also rested on
edolal evidence shows they
pared with the Democrats' It's Some of
were energized by seeing the Republican
A good economy, combened with
foundations that have taken years to build.
erence in several key races.
that could be allributed le the Democrats
right threaten President Clinton and all the
turnout appeals from President Clinton, b.
Gav. Bash, for example, "spoke out for
where Democrats
recruitment of more conservative candi-
Clinton administration stands for."
bow unions and others, made the differ-
Hisponics" while some other prominent
epel the Republicant effort to
dates, particularly in the South. But Mr.
Republican pollster Eddie Mahe
ence. Mr. Bosilis said. A recent survey by
Republicans were bashing Immigrants in
$ office for The first time
Gephardt argued that they were also at-
agreed. "We (Republicans) probably got
the Joint Center found that blacks, by a
the 1996 COP presidential primaries. noted
nation. black voter Inrnout
tracted to the party's (ocus one Issues rather
or: of the white vote in the South. he said.
51% majority. leM better off under the Clip-
We. Sharry. Meanwhile, President Clinton
than scandals.
mpared with 19% in 1954.
"Rut if you're only getting 74 OF 5% of the
Ion economy. "Blacks still aren't making
has studity championed Issues of black
by the Christian Coali-
News la the Wee Hours
black vote, it just makes it really. really.
as much as whites. but the black poverty
concern, said Mr. Bositis of the Joint Cen-
rate is at " all-time low."
ter for Pelitical and Studies.
at Democrats even managed
Christian Coalition Director Ramiy
really difficult in move the numbers. The
Pattern Among Hispanies
Asked M Mr. Clinion is indebled to black
he Republican Party's must
Tale agreed: "Democrals had an agenda.
Demacrats did an extraordinarily fine job
albeit a liberal agenda. and some agenda
in communicating the message, Those
Hispanics, a rapidly growing group ex-
voters, Mr. Bost ls replied: "If you look at
people are a threat lo you. and a threat is
pected to outsumber African-Americans
the 1998 budget deal. the White House al-
2024081056 202 456 6244
If-identified religious conser-
will beat no agenda every time."
always the most powerful motivator."
within a decade or so, also filled toward
ready has delivered to the black caucus."
and they valed for a Democ-
The full impact on the House races and
Paradaxically. exit poils show black
Democral on Tuesday. But their wite was
said they roled for a Regab-
the campaigns for governor couldn't be de-
hermout didn't increase on a national basis;
far less monotithic than the black vote.
Republicans garnered 67%
termined und the wee hours of the mem-
in fact. black veters accounted for an esti-
in California. Incombers Democratic
the religious right. as com-
ing. when West Coast results came in and
mated 107 of the total national vote this
Senator Barbara Roxer drew an estimated
close races were finally determined.
year. down from IIC in the last off-year elec-
Tyle of the Hispanic voie in ner WARTHEYE
Among the late gains for Democrats
tion of 1594. (Whites accounted for 82% of the
election bld. IShe and COP challenger
were two House seats in Washington, one
vote this year, Hispanics 58 and Asian-
Mall Fong sabit the Asian-American wile.)
in Wisconsin. and another in California.
Americans E.) Hut blacks gave an esti-
In Texas. GOP Gov. George IV. Dush wan
The Republicans managed their OWE off-
mated 58% of their wies lo Democrats. The
nearly half of the Mexican-American visite.
setting wins on the West Coast, picking up
black impact was especially concentrated in
The Hispanic vote is skill very much up
two California House seals and defeating
valed Gov. Pate Wilson (A)
Democrat Rep. Jay Johnson in Wisconsin.
Hopes of Some Tobacco
Foes Go Upin Smoke
will Gov Zell Miller (0)
Ret Mr. Johnson. a former television re-
the WALL. Stall Reporter
ney General Scott Harshbarger, who sued
Gov. Terry Bransted (A)
porter who rode Mr. Clinton's coaltails in
WASHINGTUN-When the proposed
lobacco companies and helped lo negative
1996 to win the beavily Republican district
national lobacco settlement was an-
the proposed settlement, lost 10 Republican
based round Green Bay. proved lo be the
nounced In June 1997. the attorneys gen-
Paul Cellucci in his bid for governor. Jay
eral who negotialed it were thought to be
11/25/98 17:03
only Democratic incumbent lo go down in
Nixon, Missouri's Democratic altorney
defeat. Five Republican incumbents, -
destined for higher office.
I
Rey Ramer (D)
general who sued tobacco companies in
But a bell hased on the settlement died
the other hand, lost their seats.
1997, lost his Senale race to incumbent Re
Homited Gov Lanten Chiles (D)
in the Senate, and sime of the altorneys
Among the late returns in the gover-
publican Christopher "Kil" Rond.
Gov. PM Ball (R)
general must prominently associated with
nors' races was the re-election of Hawaii
Not everyone associated with the anti-
Gov. Jim Edgar (R)
the antitobacco movement suffered de
Gov. Ben Cayetann, as endangered Demo
Lobacco movement lost. California Democ-
vited
Benjamin Neison (0)
feats in this week's electinas.
nil Gray Davis and Alabama Democral
eral hert by a weak economy. in Nebraska
with Gov. Bab Miller (0)
Minnesnta Allorney General Hubert II.
Donald Siegelman, both of whom had filed
and Colorado, Repubticant managed two
"Skip" [fumphrey. a Democral whose suit
private lawsuits as lieutenant governors
wind Gov. George Veingwich (R)
victories that helped to offset their losses in
against tobacco companies grabbed head-
against tobacco companies in solidarity
the Smith. Nebraska Gov. Ben Nelson will
lines, lost the governor's race to Reform
with the attorneys general, guberna-
be succeeded by Lincoln Blayer Mike Jo-
Gav. Ame Carlsier (R)
Party candidate former professional
torial efect
in their respective states.
Colorado's Roy R
will be
wrestler. The Body" Ventura.
Other attorneys general who had sued
succeeded by State TI
er
Owens.
In Massach
is.
ratic Altor-
tobacco
panies were re-elected.
NO. P006/006
n
legislative control game
Women, minorities propelled
graphic makeup of their states
time were decided OR local is
te legislatures
That power can be used by the
sees, not broad national trends
dominant political party to
As a result, they drew no lofty
legislatures on Election
draw lines that help their CBP
conclusions from the results.
they control as well as the
didutes win election to Com-
These are races that are de-
5 of
ment. Key gains
gress and the legislature.
cided as the neighborhood lev-
Democrats in key races
FB, North Carolina, Washington
Excessively partises redis-
d" says Mike Collins, spokes-
tricing, however, can be chat-
man for the Republican
By Jessica Lee and Marks Paente
**
chambers in Michigan
lenged in court. it often D done
National Committee.
USA TODAY
USA IVS
Republicans acknowledged their message falled to
controls both houses
to increase or reduce the
The most significant state
move enough POLITS House Speaker Newt Glagrich
influence of minurity veters.
legislative results came in
WASHINGTON Nationwide, voter turnout sank to a
promised to spend = Cale amount of time over the and
Democrat
GGP
Splll
Democrats across this
these states:
50-year lew Thesday, but strong local efforts be hrs out
week to 10 days" trying le and out why.
workess, minorities and union members helped Demo-
One reason for the unexpected outcome, activists from
country made is very clear that
Indiana, where Demo-
Mo.
they wast to be heard when M
crais wis several key contests and frastrate Republican
both parties sex is that name conservative voters M
crub broke a the in the House
Neb
ambitions in congressional and gebernatorial elections.
they were being tabes for granted, and other constitum-
onles time to draw district
to will a majority. That will
Nev.
lines," Moryland Senate Presi-
belp Democratic Gov. Frank
The ternout by eligible voters was 38.1%, the lowest
der leit wanted.
N.H.
dent Thorans Miller says.
O'Bannon combet a Republi-
since 1942," says Cards Gans, director of the Committee
in & reversed of recent election dynamics, African
for the Study of the American Electorate Voter News
Americans and Expanies seamed to feel needed while
N.J.
Going into the election, Re-
cam Senste.
N.M.
publicans had hoped to take
New Hampshire, where
Service, an association of television and wire service
religious conservatives complained that the GOP give
them short shrißt
N.Y.
X
control of a dosen OF more
Democrate took control of the
companies, reported a sightly higher turnout, 37% of the
state legislative chambers, in
Senate for the Arst time stace
voting-age popolation.
Ready This, director of the Christian Coalition, -
N.C.
cluding both houses in several
1912 and were Misely to pick up
Democrate attributed their better-than-expected show-
"an insues VOCUMEN in Washington, D.C." caused about
N.D.
states. They gained only in
about is seats in the Republi-
ing to unabashed New Dest confition-buthling OR Issues
one-fourth of to made membership to desert the GOP.
Ohio
Michigan and Minnesots.
CBG-FUR Herese.
such as education, health care and Sectal Security.
Overall, women turned out of about the same rate 6
Okla
North Carelisa. where
men. But according to the compartises Pew Research
6244
By contrast, Democrats
One?
X
picked up majoritles is Indi-
Democrats took the House and
Pa
am New Hampshire, North
padded their lend in the Sea-
Center, women "gave much stronger support to Demo-
That Interic high-water mark only entrances Bast's -
ALL
Caroline, Washington and Wis
ate. That will give Gev. Immes
crats them men gave to Republicans"
tential as a GOP presidential contender in 2000.
S.C.
consin. to Washington, they
Hand a unifled government.
in New Mark, Democral Charles Schumer stummed
S.O.
took over control of both
Washington, where bath
partics in Florida and Texas, Elignates basket BIR
three-term Republican Sea Al D'Amate, besting him by
bouses from Republicana.
houses moved into the Demo-
part to Democrats Their volues Med California Date
14 pelats. He did a will 80% of the Hispanic vote and 87%
202
The changes at the state lev-
cratic camp for Democratic
crets
till
as
Cre
Bastemnale,
who
was
elected
the
of the black vote, whereas be spfit the while vote.
el, unlike those in Congress,
Gov. Gery Locke
state's
IT
without
governer
Utah
In the Deep South, black volurs turned out be while
will have an immediate -
Wiscomein, where Demo-
Also
in
California,
Democrable
Sen
Berhara
Home
Vt
Democratic candidates. = 1994 the black vote -
pact. is Florida, Michigan and
crate took over the Senate and
best challenger Matt Form by 10 poluts. The call polls
Va'
X
about 19% of the total (in the region). It - 29% Main
Colorado, Republicans will
denied GOP Gev. Tommy
showed she not only mic but 85% of the
year," says David Besitis of the*Joint Center for Political
X
2024081056
When
control the governor's office
Thompson Fail control of the
black vote and 74% of the Elipanic vote.
and Economic Studies, 4 think task that studies Immes of
W.V.
X
and both branches of the legis-
legisloture.
HM Hispanic leyalty to Derharrats was not enough to
concern to Africas-Assericans.
Wis.
lature. In California, North
Michigan, where Republi-
make a dent in De paggerment of votes for Republican
Be says the termed exceeded African-Americant 27%
Wyo.
Carolina, Washington and Ale-
cans took over the House on
Gov. George W. Bush is Terms
share of the voting population, m unusally Not amt. h
bame, Democrats will exercise
the contails of GOP Cox Juhn
Exit polls conducted by the Southwest Voter Registra-
Georgia, black voters outpalied while voters to pet Demo
total control. One party will
Engler, who will have both
time Education Project showed Bush look 37% of the His-
-
Does
Inc
1
cret Day Barnes in the governer's mansion and elect The
control both legislative houses
houses is his camp.
USA TODAY
panic vote, with 63% going to his Democratic challenger
bert Bater as the state's first black atthroey general.
in 24 states, up from 18 today.
Minnesota, where Repub-
congressional and legisle-
This year. says Tim Storey of
licens took over the House
17:03
live district lines after the 2000
the National Conference of
With the Senate remaining
(
State Legislatores, "people
Democratic and Reform Party
Governors and legistatures
weren't looking for a whole lot
candidate Jesse Ventura elect-
redraw thuse reaps every )0
of change."
ed governor, power will be spät
years to reflect the demo-
Republicans say state elec-
three ways.
11/25/98
STATE OF THE UNION MEMORANDA TO THE PRESIDENT
TABLE OF CONTENTS
TAB 1:
Domestic Policy Council and National Economic Council
TAB 2:
Office of Speechwriting
TAB 3:
Council on Environmental Quality
TAB 4:
Office of Science and Technology Policy
TAB 5:
Climate Change Initiative
TAB 6:
Race Initiative
THE WHITE HOUSE
WASHINGTON
98 NOV
November 11, 1998
MEMORANDUM FOR THE PRESIDENT
FROM:
Bruce Reed
Gene Sperling
Elena Kagan
Sally Katzen
SUBJECT:
State of the Union/Budget Ideas
This memorandum provides a brief description of new ideas we are considering for the State of the
Union. Some work has been done on fleshing them out, but many need additional work and further
vetting through the interagency process. Most of these ideas involve increased spending, and you
will have to make choices among them and/or scale them back as you consider the FY 2000 budget.
Although our offices have worked together on many, if not most, of the ideas in this memo, we have
noted, where possible, which of our offices has the lead role with respect to each proposal. Options
relating to Social Security are not included in this memo.
EDUCATION AND TRAINING (DPC/NEC as specified)
1. Ending Social Promotion. Last year's budget proposal included $200 million for Education
Opportunity Zones in districts that agreed to remove bad teachers, turn around failing schools, and
end social promotions. The proposal required authorization, which Congress will never give us. For
next year, we recommend a simpler approach that uses existing authority and focuses entirely on
ending social promotion. We would like to expand our after-school program from $200 million to
$700 million and target this money to districts that end social promotion. These school districts
could use the money (as Chicago does) to provide extra help after school and mandatory summer
school for students who need it. (Cost: $300 million above FY99 budget.) (DPC)
2. Teacher Quality and Recruitment. Now that we're on track to begin hiring 100,000 new
teachers to reduce class size, we have an even greater responsibility to help communities attract
talented new teachers to the profession. We envision a five-part strategy on teacher quality and
recruitment: (1) a $100 million increase in the teacher recruitment scholarships we enacted this year
in the Higher Education Act, which would put us on course to attract 60,000 new teachers at high-
need schools over the next five years; (2) a $60 million initiative modeled after the successful
Troops-to-Teachers program that would help states expand alternative certification routes and
attract talented people from other professions, such as military personnel and employees in firms
being downsized; (3) a nationwide crackdown on teacher education schools, including new
regulations authorized by the Higher Education Act to require report cards for education schools;
(4) a $50 million increase in the Eisenhower program to send secondary school teachers who teach
2
outside their field back to college to take additional courses in the subjects they're teaching, coupled
with a new requirement that new secondary teachers pass competency tests in a subject before they
can teach it; and (5) a high-profile effort to help states make the most of the 15 percent set-aside for
teacher quality in the recently passed class size legislation. (Cost: about $210 million above FY99
budget). We are also exploring a politically interesting counter to private school choice: vouchers
for private school teachers -- i.e., an incentive program to encourage private school teachers to teach
in public schools. (DPC)
3. Work-Site Schools. One of the most promising new education ideas sprouting up around the
country is the creation of public schools at work sites, designed primarily to serve employees'
children. School districts provide the teachers and curriculum; companies provide facilities and
upkeep. These schools-at-work serve a host of objectives at once, by (1) providing new facilities
at no cost to the district; (2) increasing parental involvement in the schools and parental satisfaction
in the workplace; (3) reducing employee turnover and absenteeism; and (4) increasing school
diversity, because work sites are more diverse than residential neighborhoods. We propose a $100
million increase in an existing discretionary program to provide grants to 100 communities to launch
work-site schools. We also could seek a stand-alone bill (like the charter school law) to advance this
idea. In addition, we are working with Treasury to develop a tax credit for businesses that start on-
site schools, similar to the Kohl business tax credit for on-site child care that is already in our budget.
(Cost: $100 million for start-up grants. No estimate yet for tax credit, but it will be very small.)
(DPC/NEC)
4. Public School Choice. As support grows for private school vouchers, we must continue our
efforts to expand choices within the public schools. Charter schools are one answer, and we
recommend a $20 million increase, to $120 million, to keep us on track to 3,000 charter schools by
2002. Work-site schools are another. We also recommend increased funding for (1) an existing
grant program that helps urban and suburban school districts reduce racial isolation by forming
interdistrict magnet programs; and (2) magnet schools on university campuses, especially in urban
areas. (Cost: $25 million for interdistrict magnet programs; $15 million for 10 university-based
schools.) (DPC)
5. School Leadership Academies. Research has shown that an effective principal is the single
most important indicator of school success, yet little has been done at the national or state level to
improve the management skills of principals. We propose a small initiative to create school
leadership academies that would provide training in management, teacher evaluation, school
discipline, and other areas to elementary school principals in high-poverty districts. (Cost: $50
million) (DPC)
6. Class size. To stay on course to reach 100,000 new teachers in seven years, we will ask for $1.3
billion in the FY2000 budget. We are planning an ambitious rollout of the class size initiative over
the next year, as we award first-year funding, issue guidance to local districts on how the program
works, and so on. We also will press Congress to restore the local matching requirement and
strengthen the provisions to require competency testing of new teachers. (DPC)
3
7. Adult Literacy. According to the National Adult Literacy Survey, 44 million adults struggle
with a job application, cannot read to their children, or are left on the welfare rolls because they lack
basic skills. We are considering: (1) Workplace: a new tax credit and/or Federal grants to encourage
employers to provide adult basic education classes at the worksite, and setting aside funds for work-
based literacy projects within Welfare-to-Work competitive grants (se welfare section of this memo);
(2) Community: expanding the infrastructure and funding for adult basic education through the Adult
Education program, encouraging the development of programs focused on easing the transition to
the U.S. for new immigrants (through ESL and civics classes), subsidizing the provision of child care
on college campuses and other adult education sites, and launching a national information campaign
to make people aware of the problem of functional illiteracy and of available services; and (3) Home:
using the new Learning Anytime Anywhere Partnerships to create software for adult basic education
using $200 computers (e.g., WebTV, game players) and subsidizing public housing projects that
create computer literacy programs. (NEC)
8. National Campaign to Open Doors of College. Notwithstanding enormous strides we have
made in reducing the financial barriers to college, too many families assume college is more
expensive than it really is and are not aware of the aid that is available (Even among low-income
youth with high test scores, one-fourth say they have not been able to get much information about
financial aid for college). We are planning: (1) launching a major national public information
campaign about college costs and financial aid (e.g. naming a national chairman such as Bill Cosby,
having a national college visit day, etc.), (2) building on the authority in the new GEAR UP
program, providing every middle school (e.g. 7th grade counselor) with the ability to give students
a "21st Century Scholar Certificate," indicating the financial aid that they are eligible for. and (3)
seeking to provide every high-poverty middle school with a college partner. This does not require
any new investment, just some focus and creativity. (NEC)
9. Improving the College Success Rate. Getting people in the doors of college is not enough to
close the racial and income opportunity gaps. For example, only 21% of African-American and
18% of Hispanic students who begin college complete a bachelor's degree within 5 years compared
to 30% of White students. We are considering a package of policies, including: (1) a super-Pell
grant for the lowest income families and/or to encourage a full-time focus on school in the first year
of college (this would be expensive); (2) expanding successful mentoring and other support services
in colleges (including those aimed at graduate school preparation); (3) promoting college course-
taking while in high school; (4) improving maticulation between two-year and four-year colleges;
(5) encouraging partnerships between predominately minority-serving and predominately majority-
serving institutions of higher education (particularly to promote graduate study); and (6) establishing
a bridge fellowship program for graduate study in science and technology fields for minorities and
women. (NEC)
10. School Modernization. The current assumption is that we will repeat this year's proposal for
tax credits to build and renovate schools covering the interest on nearly $22 billion in bonds. We
are, however, critically comparing our current proposal against other possible mechanisms to ensure
4
we have the most effective approach. (NEC)
11. Further Expanding Junior ROTC. In response to the Los Angeles riots, Colin Powell
proposed and Congress approved in 1992 an expansion of the high school-based JROTC. Since
then, 1,000 units have been added primarily in urban areas, bringing the total to nearly 2,600 units
with 400,000 participants. The budget increased over that period from $76 million to $166 million.
There is a waiting list of more than 450 schools that would like to have a JROTC unit. Because
DOD does not plan any further expansion, these 450 schools on the waiting list will not likely be
added. We could propose adding another 900 units over the next few years, to reach the authorized
maximum of 3,500. Cost: about $235 million. (NEC)
12. Training American Workers for Current and Future Skills Gaps. We should
challenge the private sector to make specific commitments to train more American workers, which
they pledged to do during the debate on H1-B visas. They could provide more college scholarships
for women and minorities, partner with community colleges to develop cutting-edge curricula, and
encourage their employees to serve as telementors for middle school students to get them excited
about math and science. In addition, we are working on: (1) a program to foster partnerships
("Regional Skills Alliances") between industry and training providers to train both employed and
unemployed workers; (2) competitive grants to encourage companies to develop programs in which
they subsidize the training of individuals who they then commit to hire; (3) extensions and/or
expansions of some of the current training tax provisions (such as the lifelong learning tax credit and
Section 127) and (4) a major informational/media campaign by the Departments of Education and
Labor to inform all Americans about available training opportunities, financial aid, and job search
assistance to allow them to develop the skills required for employment opportunities around the
country. (NEC)
13. Making Job Training Universal. We are considering an initiative to make job training more
universal. The first component of this initiative would be to seek a significant increase in dislocated
worker funding -- about $190 million -- so that we are on path to provide training to every dislocated
worker who wants or needs it within five years. The second component would be to ensure that
every unemployed person is eligible for core labor market services, e.g., job search assistance. The
final component would be to take the steps necessary to ensure that every worker, regardless of
where they live, would be able to have access to a One-Stop Career Center (where they can learn
about job training, employment service activities, unemployment insurance, vocational
rehabilitation, adult education, and other assistance.) (NEC)
14. Community Computing Centers. We have roughly 650 computing community centers, which
empower low-income Americans in the Information Age by teaching them to type a cover letter and
a resume, search for job vacancies on the Internet, or even start an Internet-related business. These
efforts should be expanded. (NEC)
School safety - see CRIME section
5
SERVICE (DPC)
1. AmeriCorps Seniors. In the wake of John Glenn's return to space, we have an opportunity to
give other senior citizens a mission. We propose adding $25 million to the current AmeriCorps
program to create a senior corps of 10,000 volunteers to serve as tutors and mentors and in
afterschool programs. We would build on a successful demonstration program that recruits seniors
to serve 15-20 hours per week over a fixed period of time in schools and other community centers.
In exchange, seniors would be eligible for small incentives, including awards to participate in senior
learning programs. By inspiring responsibility among seniors, this initiative would provide an ideal
complement to Social Security reform. John Glenn has expressed some interest in playing a role in
AmeriCorps now that he's retired. We could invite him back to the State of the Union and place him
in charge of a national effort to inspire seniors to serve. (Cost: $25 million)
2. Expand AmeriCorps. We propose expanding the AmeriCorps program from its current level
of 50,000 members per year to approximately 70,000 per year, with the goal of reaching 100,000
per year by the end of this Administration. These additional members could be targeted to serve
primarily in after-school and summer school programs. (Cost: $75 million)
3. Expand Service Component of Work-Study Program. Nearly 1 million students now receive
federal work-study funding. Despite our efforts, colleges and universities are required to use only
7 percent of their work-study money for students employed in community service. The higher
education lobby would object, but we could propose a substantial increase in that requirement -- e.g.,
phasing it up to 25 percent over the next 3 years.
HEALTH CARE AND DISABILITIES (DPC/NEC as specified below)
1. Long-Term Care Initiative. This package could include: (1) a tax credit of up to $1,000 for
people with three or more limitations in activities of daily living (ADL) or their caregivers, at a cost
of about $6 billion over 5 years; (2) a plan for OPM to offer federal employees a choice of
high-quality private long-term care insurance policies at lower-than-market prices; (3) a family
caregiver support program, costing about $500 to $750 million over five years, that would provide
grants to states for "one-stop shops" to assist families who care for severely impaired elderly
relatives through counseling, training, and respite services; and (4) a nursing home quality initiative,
costing about $500 to $750 million over five years, that would include new enforcement provisions
(e.g., increased penalties), new funds for surveys of repeat offenders and improved surveyor training,
and perhaps a new commission to oversee HCFA's nursing home enforcement efforts and to
investigate other kinds of facilities where health care is offered (e.g., assisted living facilities).
(DPC/NEC)
2. Health Insurance Coverage Expansions. We could propose again, in new and improved forms:
(1) an initiative to encourage small businesses to form purchasing cooperatives for health insurance,
costing about $50 to 100 million over 5 years; (2) proposals to improve outreach for children's
health insurance; and (3) a proposal, more limited than last year's, to provide a Medicare buy-in for
6
certain people ages 55 to 65, benefiting about 30,000 people and costing $500 million over 5 years.
(DPC/NEC)
3. Biomedical Research. We should again propose an increased investment in biomedical research
-- perhaps (depending on how we treat tobacco money in the budget) between $500 million and $1
billion. (DPC)
4. Antibiotics (Super Bug) Initiative. Resistance to antibiotics is becoming a public health crisis,
causing prolonged illnesses and even death. A new initiative, costing about $25 million each year,
could address this problem through: (1) a major outreach and education campaign involving
hospitals, health professionals, and managed care organizations; and (2) new research and
surveillance efforts to understand where and why antibiotic resistance occurs and to develop
effective responses. (DPC)
5. Bioterrorism Initiative. This initiative, costing $100-300 million each year, would: (1) train
epidemic intelligence officers who can coordinate with state health departments to identify and
respond to attacks; (2) develop a mass casualty emergency response system that includes primary
care, emergency transportation, and decontamination abilities; (3) create and maintain a stockpile
of pharmaceuticals; and (4) improve research to develop new vaccines and antibiotics to be used in
the event of attack. (DPC)
6. Prescription drug coverage for Medicare beneficiaries. We are considering a variety of
proposals to address the lack of coverage for prescription drugs in Medicare, including a
means-tested Medicaid option, an approach that would apply only in managed care, a traditional
benefit for all beneficiaries, and an unsubsidized purchasing mechanism that uses Medicare's size
as leverage for drug discounts for beneficiaries. If desirable, a proposal could be included in the
budget or coordinated with the March release of the Medicare Commission's recommendations. The
cost varies significantly depending on the proposal, ranging from $1 to 20 billion a year. A proposal
of this kind probably would depend on tobacco funding (see tobacco section below). (DPC/NEC)
7. Protecting beneficiaries from HMO withdrawals from Medicare. This year, a number of
HMOs pulled out of Medicare with only a few months notice, leaving 50,000 beneficiaries with no
plan options in their areas. You announced that the Administration would develop legislation to
prevent this behavior in the future, and we are currently reviewing the best approaches. (DPC)
8. Redesigning and increasing enrollment in Medicare's premium assistance program. Over
3 million low-income Medicare beneficiaries are eligible but do not receive Medicaid coverage of
their Medicare premiums and cost sharing. Many more may not get enough assistance through a
new provision that is supposed to help higher income beneficiaries. We are developing a range of
proposals, costing up to $500 million over five years, to use Social Security Offices to educate
beneficiaries about this program, reduce administrative complexity for states, and give them
incentives to engage in more aggressive outreach efforts. (DPC/NEC)
9. Disease Initiatives. We are working on several initiatives designed to combat particular diseases.
These initiatives, which you could choose to do individually or in combination, are: (1) an asthma
initiative, which will curb recent steep increases in asthma cases especially among young children,
by disseminating new treatment guidelines to state and local public health programs and encouraging
them to work with schools, child care organizations, businesses, and other community organizations;
(2) a mental illness initiative that will accompany a Surgeon General's report on this subject (and
perhaps a White House Conference recommended by Mrs. Gore) and will include public-private
partnerships to improve access to prevention and treatment, reforms in federal health programs to
improve delivery of mental health services, and funding increases in the mental health block grant;
and (3) a heart disease initiative, which could include: a new partnership with aging networks to
evaluate and improve nutrition; efforts to measure successful prevention approaches and replicate
them nationwide; and the creation of a network of educators, churches, and community-based
organizations to launch a nationwide awareness campaign. In each of these initiatives, the public
health efforts described above would supplement NIH funding of research projects. The estimated
cost of these initiatives is $50 million for asthma, $100 million for mental illness, and $20 million
for heart disease. (DPC)
10. Food Safety. We are working on a food safety initiative that will highlight safety standards and
enforcement. Included in this initiative are: (1) a repackaged and somewhat modified legislative
proposal giving the FDA and USDA additional enforcement powers (e.g., mandatory recalls and
civil penalties); (2) additional food-specific regulations and/or guidelines (e.g., for certain fruits and
vegetables); and (3) more extensive adoption of our model codes for restaurants and food service
workers. In addition, we will focus on improving coordination with state and local agencies that
regulate food safety in order to develop a wholly integrated national inspection system. (DPC)
11. Disability -- Health. A health-related disabilities package could include: (1) the Jeffords-
Kennedy Work Incentives Improvement Act, which enables people with disabilities to go back to
work by giving them an option to buy into Medicaid and Medicare, at a cost of about $1.2 billion
over 5 years; (2) a proposal, costing $50 million over five years, to promote the deinstitutionalization
of Medicaid beneficiaries by developing viable community-based care alternatives for people
residing in nursing homes after a "date certain"; and (3) a proposal to make Medigap supplemental
insurance more accessible to people with disabilities.
12. Diability - Getting People to Work. A work-related disabilities package could include: a tax
credit of $1,000 to $5,000 for working people with disabilities to assist them in paying for the costs
associated with employment, at a cost of about $1 to 2 billion over 5 years; a new competitive grant
program, developed by your disabilities task force, to increase the employment rate of adults with
disabilities; and efforts to ensure that new technologies are designed so as to be accessible to people
with disabilities (see technology section). (DPC/NEC)
8
TOBACCO (DPC)
1. State Menu. Our best vehicle for enacting tobacco legislation next year will be a legislative
waiver of federal Medicaid claims to the states' expected $200 billion settlement with the tobacco
companies. We will seek bipartisan agreement on a menu of uses for the federal share of state
money, with tobacco control and child care as our top priorities. We will try to use this measure as
a vehicle for other key elements of our tobacco policy, such as FDA jurisdiction and warning labels.
2. Price Increase. One of the most difficult budget decisions will be whether to assume a tobacco
tax increase in our budget request, and if so, what to do with the money. There are strong arguments
on each side of the question whether to include a tobacco tax increase in our budget. If we do
assume tobacco revenue, the candidates for it include: (1) assistance to tobacco farmers (about $1
billion a year); (2) the long-term care tax credit (about $1 billion a year); (3) other tax cuts, such as
a child care / stay-at-home tax credit and/or a reduction in the marriage penalty; (4) NIH research;
(5) public health programs; and (6) the Medicare trust fund and/or a new prescription drug benefit
for Medicare beneficiaries.
3. Medicare Suit Against Tobacco Companies. Our best leverage over the tobacco industry is
the prospect of a federal suit to recoup Medicare costs associated with smoking. We could call on
Congress to enact Senator Graham's legislation to authorize such a lawsuit (which would make the
Justice Department more likely to bring it). At the same time, we could ask for funds for DOJ and
HCFA to prepare a lawsuit against the tobacco industry. We could go further and pledge that any
proceeds from such a lawsuit would be used either to extend the life of the Medicare Trust Fund or
to provide a new prescription drug benefit to Medicare beneficiaries. (Cost: to be determined, but
probably small).
FAMILIES AND CHILDREN (DPC/NEC as specified)
1. Expansion of the Child Care and Development Block Grant (old policy). We propose to
expand the Child Care and Development Block Grant as we did in the FY 1999 Budget. The block
grant is the primary federal child care subsidy program, helping low-income working families to pay
for child care. Currently, between one and two million children are served by the program, leaving
roughly nine million children who are eligible but unserved. This proposal would cost at least $7.5
billion over five years. (DPC)
2. Tax Relief for Parents, Including Parents who Stay at Home. We are considering replacing
our last year's proposal to expand the Child and Dependent Care Tax Credit with a new proposal to
benefit all parents, including those who stay home. This change will address the criticism that our
child care initiative did little for stay-at-home parents. We are reviewing proposals to (1) double the
child tax credit to $1,000 per child for all children under the age of four, at a cost of about $12 billion
over five years; (2) increase the standard deduction for each child under the age of three by $1,000,
at a cost of about $3 billion over five years; or (3) expand the Child and Dependent Care Tax Credit
as we did last year and extend its benefits to parents with children below age three by assuming
9
minimum child care expenses of $150 each month, at a total cost of about $21 billion over five years.
Each of these proposals can be dialed up or down by adjusting either the age threshold or the dollar
amount. (DPC/NEC)
3. Tax Credit for Businesses Providing Child Care. We could again propose to provide a tax
credit to businesses that provide child care services for their employees. The credit, which covers
25% of qualified costs but may not exceed $150,000 per year, costs $500 million over 5 years. To
further build on this concept, we also propose to provide tax credits to businesses that provide on-site
schools (see education section). (DPC/NEC)
4. Parent Paid Leave Plan. Many workers cannot afford to take unpaid leave following the birth
or adoption of a child, even though they have access to an unpaid leave policy through FMLA or
voluntary employer benefit plans. To address this problem, we are considering a proposal to provide
eligible parents who already have access to unpaid leave with partial wage replacement for a set
period of time. The cost of the program, which would be administered through the Unemployment
Insurance System, varies according to the selected eligibility criteria. If we choose, for example, to
give $200 per week for four weeks to new parents with median income (about $37,000) or below,
the cost will be about $875 million for FY 2000 (including start-up and administrative expenses)
(DPC)
5. FMLA Expansion to Businesses with 25 Workers (old but unarticulated policy). Under
current law, workers are eligible for FMLA coverage only if they work at a business with 50 or more
employees and if they have worked at least twelve months and 1,250 hours for the employer. In
your last State of the Union, you called for covering more workers under the FMLA, but did not
fully articulate how you would do so. We could now advance a specific proposal to lower the
FMLA threshold to 25 or more workers, which would expand coverage for up to ten million more
American workers. (DPC/NEC)
6. Parent Education and Support Fund. We are considering proposals to create a competitive
grant program administered by HHS to fund parent education and support programs, including home
visitation programs and "second chance maternity homes" to support teen mothers and teach
parenting skills. This fund could cost about $500 million over five years. (DPC)
7. Adoption Registry. We are working on plans to create an Internet-based adoption registry of
foster care children waiting to be adopted, so that prospective adoptive parents can learn about these
waiting children. Funding this registry would require a very small increase in HHS's Adoption
Opportunities Grant Program. (DPC)
CRIME (DPC)
1. Crime Bill II. The 1994 Crime Act will expire at the end of the FY 2000 budget cycle,
guaranteeing that the next Congress will consider major crime legislation. We recommend that you
get a jump on this debate by using your State of the Union and FY 2000 budget to challenge
10
Congress to pass a new crime bill that builds on the core elements of the successful 1994 Act more
police, smarter punishment, and more prevention. Most of the money required is already built into
future budgets; continuation of the COPS program, however, will require new funds totaling about
$1 billion. We believe that a new Crime Act should include the following elements:
Community-Oriented Policing and Prosecution Services (COPPS). Your pledge to help
fund 100,000 more police is likely to be fulfilled before the end of next summer. A new
COPPS initiative (note the extra "P" for "Prosecution"), costing about $1.4 billion in the first
year, could include funds to: (1) hire, redeploy, and retain an estimated 7,500 more police
each year; (2) provide modern technology and equipment and support training in modern
policing techniques, with a special emphasis on "hot spots" technology; (3) hire, train, and
equip prosecutors to join local police in fighting crime on a more community-based, pro-
active basis; and (4) support partnerships between law enforcement and community-based
groups to prevent crime in their areas.
A new focus on probation supervision and coerced abstinence. The punishment title of
the crime bill now focuses largely on prison construction; we recommend shifting the focus
to a new "Certainty of Punishment" initiative that will support the expanded use of probation
supervision and of drug testing and treatment.
Gun initiatives. A new crime bill should include your longstanding firearms priorities
juvenile Brady, Brady II, federal CAP legislation and child safety locks. It also could
include new proposals to: (1) close the loophole that exempts many firearms sales at gun
shows and flea markets from Brady background checks; (2) expand the Youth Crime Gun
Interdiction Initiative (YCGII) -- to trace all crime guns and investigate gun traffickers -- to
an additional 20-40 cities; and (3) assemble gun strike forces -- teams of federal prosecutors
and ATF agents, acting with local law enforcement -- to target cities with high levels of gun
violence and crack down on gun traffickers.
Values-based crime prevention initiative. In addition to other crime bill prevention
programs, we could invest in promoting values-based crime and violence prevention efforts,
such as those of Rev. Eugene Rivers. Funds from this program would go to comprehensive
prevention programs run by faith-based and other institutions seking to instill and reinforce
common sense values in troubled youth.
2. Safe, Disciplined, and Drug-Free Schools. At the White House Conference on School Safety,
you announced that you would overhaul and strengthen the Safe and Drug-Free Schools Program.
Under this proposed reform, funds will be appropriately targeted to schools with serious drug and
crime problems, and schools will have to adopt rigorous, comprehensive school safety plans that
include: tough but fair discipline policies, such as zero tolerance for guns and drugs; safe passage
to and from schools; effective drug and violence policies and programs; annual school safety and
drug use report cards; links to after school programs; efforts to involve parents; and crisis
management plans. We also could include in this package (1) funds for states that adopt a policy
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of drug testing first-time applicants for drivers' licenses and (2) funds for school districts that adopt
a policy of drug testing middle and high school students with parental consent. We believe that these
reforms will require up to $450 million in new funding in FY 2000.
3. Parity for Substance Abuse Treatment. Appropriate substance abuse treatment remains
unavailable to nearly half of the people who need it. To help fill this treatment gap, we could
propose legislation to encourage parity between substance abuse treatment and other medical
benefits. Similar to the Mental Health Parity Act signed into law in 1996, a current draft of this
legislation would prohibit health care plans that provide a substance abuse benefit from setting
annual or lifetime dollar limits on this benefit at a lower level than those for other medical and
surgical benefits. At the same time, we would have to ensure that federal health programs provide
parity between substance abuse treatment and other medical benefits; we are still exploring the cost
of any necessary reforms to these programs.
4. Binge Drinking. We are working on a number of proposals regarding alcohol abuse, including
(1) promoting a voluntary code for alcohol advertisements directed toward minors; (2) banning
alcohol billboards near schools; (3) discouraging alcohol advertising on youth-oriented web sites;
(4) and funding educational efforts about the dangers of alcohol consumption.
PENSIONS (NEC)
1. Expanded Private Pension Plan Coverage: Last year, you announced several initiatives to
expand pension plan coverage which were not enacted, but which we continue to believe are
important and have substantial support on the Hill. We should again call for legislation that:
authorizes a simplified plan for small businesses that combines the best features of a defined benefit
and defined contribution plan (SMART), costing $313 million over five years; provides a three-year
tax credit to encourage small businesses to set up retirement programs, costing $508 million over
five years; and authorizes payroll deductions for IRAs. We are exploring ways to expand coverage
for moderate and lower-income workers. Consideration is also being given to ways of enabling
multiple small businesses to pool together for pension plan administration.
2. Women's Retirement Security: To underscore the importance of pensions for women's
retirement security, you would call for legislation enacting the two initiatives you announced in late
October namely, that time taken under FMLA should count toward retirement plan vesting
requirements and mandating that employer plans offer an option that pays less while the retired
employee is living but pays a survivor benefit equal to at least 75 percent of the benefit the couple
received while both were alive.
3. Pension Portability: You could renew your call for reducing vesting requirements from five years
to three years for employer matching contributions to 401(k) and other plans to reflect an increasingly
mobile workforce, and more workers moving in and out of the workforce over a lifetime. We are also
exploring various options that would increase pension portability and facilitate the movement of
retirement savings between plans, where this can be done without encouraging "leakage" or loss of
12
worker protections -- e.g., providing that federal employees can roll over retirement savings from
private sector qualified plans into the federal Thrift Savings Plan.
4. Expand Pension Right to Know Provisions: You could call for a pension right to know package
that provides for both workers and their spouses general information relating to retirement needs and
their benefits under employer retirement plans. In addition, an employee's spouse should have the
same rights to get information as the employee, before waiving the statutorily provided survivor
protection. You should call for a Pension Right to Know package that provides information for both
workers and their spouses. We are also working on an employee education program that would
provide employees with the tools they need to work with their employers to provide pension plans,
and are thinking about how to encourage courses in high schools on the importance of savings and
other general investment education (which can be combined with the Consumer Literacy and
Education campaign described below). Consideration is also being given to a savings stamp book
program in the schools (sell savings stamps in very small amounts; when the book is full, turn it in
for a U.S. savings bond) to help educate the young about how to reach savings goals.
5. Increase Retirement Security: To promote security, we are continuing to work on the pension
audit bill, changes to the multi employer (collectively bargained) plan rules, and expansion of
PBGC's missing participant program.
COMMUNITY EMPOWERMENT (DPC/NEC for all)
1. CDFI Tax Credit. We are looking at a proposal to extend tax incentives to encourage
investment in CDFIs, which would leverage additional private investment in distressed areas and
stimulate the economic revitalization of those areas. Under the proposal, $100 million in non-
refundable tax credits would be made available to the CDFI Fund to allocate among equity investors
in qualified CDFIs using a competitive process.
2. Microcredit Initiative. We are working to identify means to increase support for
microenterprise finance, both domestically and internationally. We are examining whether to build
on Senators Kennedy's and Domenici's PRIME legislation which would provide technical assistance
to microenterprise. We are also looking at increased funding for CDFI initiatives specifically
targeted to microenterprise. On the international side, we are looking at whether we can increase
microenterprise funding through USAID or MDBs, especially to countries hardest hit by the
financial crisis.
3. Clean Water, Parks, and Communities Bonds. We are examining three proposals to
encourage "green" infrastructure projects. The first model uses the same financing mechanism as
your school construction proposal for a menu of projects: protecting and improving water quality;
cleanup of contaminated sediments; waterfront reclamation and revitalization; stormwater runoff
control; purchasing of green spaces to prevent sprawl; park enhancements and revitalization, and
brownfields cleanup. The second model, which provides a smaller incentive than the first model,
would create new tax-exempt bond authority for these state and local areas to invest in clean water,
13
parks, and communities. The advantage of this model is that it builds on the current system of bond
finance. The final model would allocate tax credits (like the Low-Income Housing Tax Credit) to
states and local areas to provide to the developers of these green infrastructure projects.
6. Low-Income Housing and Homeownership Tax Credits. We recommend that you again
propose a 40-percent expansion of the Low-Income Housing Tax Credit, which would help develop
an additional 150,000-180,000 affordable housing units over the next five years, at a cost of $1.6
billion over five years. In addition, we are examining two kinds of tax credits to promote
homeownership among lower-income families. The first proposal would use the model of the Low-
Income Housing Tax Credit to create a Low-Income Homeownership Tax Credit. Under this
proposal, low-income families would receive a low- or zero-interest second mortgage, which would
reduce their upfront costs (e.g., downpayment and closing costs) and investors would receive tax
credits in return. The second proposal is a $5,000 tax credit for first-time homebuyers in
Empowerment Zones or Enterprise Communities. Finally, you can call on Congress to accelerate
the increase in the volume cap on private activity bonds, which would help states and localities
provide below-market mortgages to first-time homebuyers with relatively low incomes.
7. Housing for the Elderly Initiative. This proposal is designed to improve housing for elderly
people and thereby provide an alternative to nursing home care. In addition to providing capital to
improve and modify such housing to meet the needs of elderly residents, the initiative would provide
housing vouchers for low income elderly who live in housing developed through the Low-Income
Housing Tax Credit. Because the tax credit helps subsidize rent, this proposal would allow us to
leverage our resources and provide more vouchers to the poor elderly.
8. Re-Develop 10,000 Abandoned Buildings. Abandoned buildings are a symbol of urban blight,
and an action plan to turn this around will be a powerful signal of change. We are examining
different proposals to help re-develop 10,000 abandoned buildings, combining several existing
programs or providing grants or tax incentives to spur private-sector redevelopment of these sites.
9. Homelessness. We are working on a three-part proposal that would: (1) assist the approximately
250,000 homeless veterans by increasing residential alternatives, community-based contracted care,
job preparation activities, stand down activities (community-sponsored events that conduct one-stop
service delivery programs for homeless veterans), the distribution of clothing, and long-term
housing; (2) allow VA to sell surplus property with 10 percent of proceeds going to homeless
veterans; and (3) start a demonstration project targeted to the chronically homeless to test the most
promising models for moving the chronically homeless to self-sufficiency using a combination of
permanent housing and links to mainstream services. Cost: $105 million -- $60 million for VA and
$45 million for HUD demonstration project.
RURAL/AGRICULTURE (NEC/DPC as specified)
1. Strengthening the Safety Net. To help farmers suffering from the depressed export markets and
natural disasters, we are considering various reforms of the crop insurance program and closing gaps
14
in the emergency loan program. We are paying special attention to programs that will help small
family farms. (NEC)
2. Bringing the knowledge of land grant colleges to every rural American: The USDA spends
$1.6 billion on agricultural research, much of it at America's land grant colleges and universities.
The government could provide grants to ensure that this information is available on the Internet and
is well-organized --so that all rural Americans can easily access information on topics such as crops.
livestock, rural development, natural resource conservation, and food safety. (NEC)
3. Emergency Medical Services in Rural Areas. The presence of viable emergency systems is
critical for residents in rural areas, because of the high rates of injury associated with jobs in these
areas and the long distances to health providers. This proposal, costing about $50 million, would
provide funds to States and local communities to improve access to 911 services or alternative
emergency systems. It also would fund programs to help rural communities train local citizens in
CPR and first responder techniques and to recruit and retain emergency personnel. (DPC)
4. Rural Transportation. Transportation is crucial to the efforts of residents and businesses in
rural America to improve the livability of their communities and expand their economic activities.
We are developing a rural transportation initiative that will help those who live and work in rural
areas by improving the ability of farms and businesses to obtain materials and move their products
to markets, and by making it easier for small communities to attract additional commercial jet air
service. (NEC/DPC)
TECHNOLOGY (NEC)
1. Curbcuts on the Information Highway. We are looking at several options that would make
information technology usable by people with disabilities in a manner that improves their lives: (1)
investing in R&D (e.g., text-to-speech, automatic captioning, speech recognition); (2) giving
disabilities groups a seat at the table as the standards for new technologies are developed; (3) making
the government a model "user" of accessible technology; and (4) explore opportunities for greater
deployment. In addition, the tax credit for work-related impairment expenses for people with
disabilities could be used to expand the market for assistive technology.
2. A Digital Library for Science, Math and Engineering. We need to get every young student
and undergraduate excited about math, science and engineering. We are exploring creating a "digital
library," which would contain lectures from Nobel Prize laureates, have an ability to track and
replicate cutting-edge scientific experiments, and make it easier for students and teachers to locate
the best instructional material on the Internet.
3. Information Technology Research Initiative. Increasing our investment in information
technology research, which is currently about $1 billion of the federal research budget, could lead
to the following breakthroughs: supercomputers that can more rapidly perform important functions,
such as designing life-saving drugs and predicting severe weather systems; wireless networks that
15
can bring telemedicine and distance learning to rural America; a device of the size of a paper that
could monitor the vital signs of a senior citizen, send a "911" message in the event of a medical
emergency, and provide an exact location using global positioning technology; new software tools
that can help us cope with "information overload" by discovering patterns in huge quantities of data;
and intelligent spacecraft that can explore the Solar System. Options have been developed at
roughly $100, $200 and $400 million in FY2000; and $1, $2 and $3 billion over 5 years.
4. 21st Century Research Fund. One initiative that you announced in last year's budget that we
think is important to continue is the 21st Century Research Fund -- which provided across-the-board
support for civilian R&D at agencies such as NIH, NSF, and Energy. For FY99, Congress provided
a 10 percent increase for basic research, so this is an area where bipartisan cooperation is possible.
Currently, the FY2000 budget reflects only a 2% increase in civilian research.
WELFARE REFORM, CHILD SUPPORT ENFORCEMENT, AND CHILD WELFARE (DPC)
1. Reauthorize the Welfare-to-Work Program. Congress authorized the Welfare-to-Work
Program for only two years; if we wish to continue our current investment in the hardest-to-employ,
we will have to propose a reauthorization of about $1.5 billion annually. Within this funding level
we propose several set-asides, totaling $500 million, for the following specific purposes: (1) work-
based English-language literacy projects for immigrants and others; (2) work-based substance abuse
testing and treatment programs; (3) employment services for welfare recipients with disabilities; and
(4) a work-based program to promote responsible fatherhood, including efforts to increase low-
income fathers' employment and earnings and ensure that they provide financial and other support
to their children. At the same time, we should (1) seek an additional 50,000 welfare-to-work housing
vouchers, and (2) call on Congress to make permanent the Welfare-to-Work Tax Credit and the
Work Opportunity Tax Credit, both of which now expire on June 30, 1999.
2. Child Support. One initiative, costing just a few million dollars each year, would increase the
prosecution of egregious child support violators by establishing multi-agency teams, working with
state and local law enforcement, to identify, analyze, and investigate cases for prosecution. A pilot
project of this kind is already under way in five states; this proposal would put these units in place
all across the nation within the next several years. A second initiative would seek legislation to
exclude doctors and other health care providers who are delinquent in child support from the
Medicare program or from programs offering health professional loans.
3. Children "Aging Out" of Foster Care. Each year, nearly 20,000 18-year-olds "age out" of the
public child welfare system. Federal financial support for these young people ends just at the time
they are making the critical transition to adulthood. Areas for increased investment for these young
adults include: (1) expanding the independent living program, which provides services to foster care
children in this age group; (2) expanding the transitional living program, a competitive grant
program that funds community-based organizations that provide services to this population,
including housing support; and (3) giving states the option of using Federal Medicaid dollars to
provide health care coverage for this population. (Cost: roughly $150 million each year)
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CIVIL RIGHTS AND WOMEN'S RIGHTS (DPC)
1. Equal Pay. We are working on a program to be run by the EEOC and DOL to increase outreach
to businesses and employees about equal pay requirements, provide technical assistance to
businesses seeking to comply, improve training for EEOC employees, and expand enforcement
capabilities. In addition, the program will fund research on the nature and extent of wage
discrimination, as well as a new Women in Non-Traditional Occupations Initiative designed to
improve access of women into occupations such as construction and high technology. Cost: about
$20 million for EEOC and $10 million for DOL.
2. Abortion Violence. We are working on a comprehensive initiative to address violence against
providers of reproductive health services. This initiative may include: (1) a National Task Force
established by the Department of Justice that will conduct investigations of abortion violence, collect
and collate information related to clinic violence, and provide training to federal, state, and local law
enforcement personnel on how to address this problem; (2) special security measures, including
stepped-up U.S. Marshal support, at clinics identified to be at risk of violence; and (3) federal
guarantees of loans taken out by clinics that must rebuild after they have been attacked. Cost:
Unknown at this time.
TRANSPORTATION (NEC/DPC as specified)
1. Reauthorization of the FAA, with Focus on Modernization and Competition. A blue-ribbon
bi-partisan panel concluded last year that the air transportation system faces "gridlock" within a
decade without sweeping changes. We are considering various policy options to incorporate into
the FAA reauthorization that you will propose in 1999 (it is a must pass this year) that will: (1)
improve the efficiency and capacity of the nation's aviation system, and (2) enhance competition and
service to rural areas. Some of the components of this initiative would include: centralizing the air
traffic control services (ATS) in a performance-based organization (recommended by the bi-partisan
panel); financing ATS for commercial aviation through cost-based user fees (supported by the major
airlines); increasing Passenger Facility Charges (PFCs) to finance airport expansion nationwide
(supported by state and local governments); modifying federal rules on how airports can use PFCs
and other funds to encourage new airline entrants; and enhancing service to underserved areas.
We are also looking at ways to further competition in international aviation. The Administration has
extended the benefits of competition by negotiating dozens of bilateral open-skies agreements. We
could press our trading partners for World Wide Open Skies and explore lifting other restrictions on
foreign aviation investment and operation on a reciprocal basis. (NEC)
2. Auto Safety. We are making headway on auto safety. Last year, the number and rate of auto
fatalities declined. However, we still have a long way to go -- more than 40,000 Americans die in
auto accidents each year, at a direct cost of $150 billion. The keys are seatbelts (more) and alcohol
(less). We are working on a comprehensive initiative that would include: (1) meeting the President's
goal of 85 percent seatbelt compliance by the year 2000, which would save 4,000 lives and nearly
$7 billion; (2) promoting education initiatives like the Buckle-Up America campaign; (3) enforcing
the TEA-21 requirement that states lower the legal blood alcohol content level from 10 to .08; and
(4) pushing a new Administration initiative on children's safety that will target auto accidents, among
other problems, by promoting the use of child safety seats, booster seats (for children ages 4-8), and
bicycle helmets. (NEC/DPC)
3. Transportation Needs of the Aged. With the number of Americans over 65 expected to grow
by half by 2020, we should begin addressing the need to ensure their continued mobility,
independence and safety in their later years. We are only beginning to look at this issue with DOT,
which plans to hold six town meetings soon with senior citizens, medical experts, transportation
safety specialists, and others to discuss the problems and challenges and identify best practices. The
U.S. will host an international conference on this topic next year, in connection with the United
Nation's Year of Older Persons. This may be combined with the long-term care and the housing for
the elderly initiatives. (NEC)
4."Smart Growth" and Sustainable Development. One of the biggest challenges facing
America's communities is that "sprawl" development is threatening the long-term economic vitality
and quality of life in America's urban, suburban and rural areas. Although land use decisions should
remain the domain of state and local government, the federal government can be an effective partner.
First, we will continue investing in sustainable transportation. TEA-21 authorizes a record $41
billion over the next six years for transit; increases tax-free transit benefits; and expands
communities' ability to transfer funds from highway construction to transit, bicycle and pedestrian
programs, telecommuting and other forms of transportation that reduce congestion and pollution.
Second, we will provide incentives to make it easier for communities to pursue smart growth
policies, by exploring ways cities can capture the air quality benefits of sustainable development
and by supporting a private sector initiative that would encourage mortgage lenders to consider the
savings from "location efficiency"in making mortgage determinations for homebuyers . (NEC)
ENERGY (NEC)
1. Electricity Restructuring. You could call on Congress to enact legislation, to make the
electricity industry more competitive and to provide more choices for industrial, commercial and
residential customers. The Administration's Comprehensive Electricity Competition Act will save
consumers $20 billion a year. Retail competition will not only improve efficiency, but also reduce
the two-thirds waste of energy currently associated with fossil-fuel generation of electricity, thereby
cutting greenhouse gas emissions. Prominent Republicans have included electricity restructuring
on their list of priorities for 1999.
2. Distributed Generation ("Micropower"). To increase the consumer savings and environmental
benefits from electricity competition, the Administration will pursue legislation to eliminate
obstacles to the use of small, clean efficient generation technologies (e.g., fuel cells and
photovoltaics) that can be installed at or near the electricity user's site. Moving from large, central-
station generation of electricity to distributed generation by small, clean sources is analogous to the
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move from mainframe computers to personal computers.
FINANCIAL SERVICES (NEC/DPC as specified)
1. Consumer Financial Literacy and Education. We are currently developing a set of proposals
to promote consumer financial awareness and enhance consumer credit literacy, ranging from a
public awareness campaign to establishing an educational clearinghouse to disseminate quality
curricula to high school students. We are also working on a study to identify what the biggest
problems are with how Americans use consumer credit, and what basic banking services and steps
they can take to help themselves (this may be very important if bankruptcy reform is a live item next
year). Part of our focus is on reaching out to low-income households, building on (and expanding)
two existing government programs -- Treasury's Electronic Funds Transfer program that was a first
step in helping the "unbanked" enter into electronic commerce and a USDA extension program that
is providing some (limited) services to rural low-income families. This proposal would cost $5-10
million. (NEC)
2. Consumer Financial Bill of Rights. In order to respond to the outrage consumers feel about
ATM surcharges, without supporting economically questionable regulation of ATM fees, we are
considering a proposal either for the government or for financial institutions voluntarily to make
publicly available a list of basic banking services and fees on an individual or geographic basis to
be published periodically over the Internet. The services profiled would include, but would not be
limited to, charges for access to ATMs. We are also considering the adequacy of current credit card
disclosure requirements (again, relevant to bankruptcy reform) and other areas where information
about financial service arrangements would be helpful to consumers. This would cost $3-5 million.
(NEC/DPC)
11-25-98
THE WHITE HOUSE
WASHINGTON
November 23, 1998
MEMORANDUM FOR THE PRESIDENT
CC:
JOHN PODESTA
DOUG SOSNIK
FROM:
MICHAEL WALDMAN
SUBJECT:
STATE OF THE UNION CONTEXT & PURPOSES
This memorandum reflects initial discussions among Paul Begala, Maria Echaveste,
Mark Penn, and myself.
The 1999 State of the Union comes at a signal time for you and your administration. In
raw political terms, you enter your seventh year in office stronger than any comparable President
this century -- stronger than Roosevelt, stronger than Eisenhower, stronger than Reagan. Your
support in the country is strong. The Democrats' election success not only represents the first
such gain by a President's party since 1822; it also narrows the party divide in the House. The
public has endorsed your 'third way,' New Democrat policies an endorsement seen not only in
the Democrats' election success (on a platform of saving Social Security, fiscal responsibility,
HMO reform, and education), but also in the success of moderate Republican Governors and in
the success of reformed center-left parties in the UK, Italy, Germany, and Brazil. And the press
and pundits are now willing to admit that you were the pioneer of this approach.
At the same time, this address marks the last opportunity before Election Year 2000 to
command the public's attention as only a strong State of the Union can. (The Year 2000 State
of the Union will be held two weeks before the New Hampshire primaries.) And with less
than a year to go before the new millennium, there is added urgency to your call to strengthen
the nation for the 21st Century.
This speech should be viewed as having four principal goals.
First, it should demonstrate that you continue to have a vigorous agenda, one that can
define the political playing field. You did this very successfully in last year's speech, and in
the blizzard of policy announcements that led up to it. We believe you should announce an
array of small- to medium-sized policies in January, as part of the roll-up to the State of the
Union.
Second, more than recent State of the Union addresses, it should explicitly focus on the
economy - spelling out what we must do to advance our prosperity. A key element will be
Social Security (Should we put forward a plan? Convene negotiations) and the surplus. The
address should also include significant discussion of how to steer the economy through
international economic turbulence; this would be an opportunity to spell out your vision for an
international economy with a human face that you have talked about at the WTO and Council
on Foreign Relations. And it should press forward on education and health care as part of an
economic strategy.
Third, it should reach out to centrist Republicans to build a governing majority (on
terms that you define). Thus, you should press for action on those items (such as the
Patients' Bill of Rights, campaign finance reform, and other matters) that have notably
bipartisan support.
Finally, the speech is an opportunity to address specific constituencies and shore up
areas of political weakness. There should be a renewed focus on crime; specific attention to
rural issues and the elderly; a full discussion of military readiness. In addition. we would
appreciate your guidance on what you want to say about race.
***
We will forward to you some possible thematic approaches for discussion tomorrow.
POSSIBLE THEMATIC ELEMENTS
FOR 1999 STATE OF THE UNION
As before, the central theme should be: strengthening the nation for the 21st
Century. With only 346 days until the coming of the new millennium, this year must be a time
of focused action. We must step up to our long term challenges, advance our prosperity with our
new economic strategy for a new economy, press forward our progress on social issues, and find
ways to bind our nation together in the new century.
The American renaissance. Seven years ago, on our bestseller lists and on the
shopfloor, we asked, "America: What went wrong?" In your first Inaugural Address, you
declared, "There's nothing wrong with America that cannot be cured by what is right with
America." For seven years, the American people rose to the challenge of this new time. And
now, we enter the new century at a new peak of power and prosperity. Our economy is the
strongest in a generation and keeps the world moving forward; crime and welfare are at their
lowest levels in thirty years. A shimmering new economy, built on technology and science,
information and innovation, has risen, creating massive new affluence. We can count our
blessings as we ask: America: What went right?
Renewing progressive government -the third way. We have fashioned a new,
progressive government in tune with our time. We turned not to the failed policies of mindless
big government or heartless laissez faire. We did not seek to stop economic change and choke
off the benefits it can bring; instead, we welcome it, and seek to give individuals and families the
tools to thrive. This approach has been called "the Third Way," and it is now the American way.
Our people intuitively understand that this is the best, indeed the only, way to master the new
challenges of the 21st Century.
The moment of opportunity for the vital center. We have forged a new consensus, a
new common public philosophy that binds together Democrats and Republicans of goodwill.
This is a rare moment for action. The people have spoken, indeed have spoken with
unmistakable clarity: they want us to put politics aside and act, together, on their needs and their
concerns. You will reach out to Congress to make this a time of progress and not partisanship.
This should include a specific reference to the new congressional leadership.
Building a new American economy --and continuing our economic strength. Our
comprehensive economic strategy, enacted in 1993, has turned this country around and widened
the circle of opportunity. Today America's economy is the strongest in our memory, and
indeed, is the dynamo that propels the world economy. But change is constant, and the current
financial turmoil reminds us that we must act to advance that prosperity. We must hold fast to
our fiscal discipline, and give our families confidence that Social Security will be strong in the
21st Century.
Using this moment of prosperity to meet long-term challenges. The nation is at a
moment of unparalleled strength. We can and must use this national strength to build for the
future --to grapple today with the longest term challenges of tomorrow. America is aging; we
must address Social Security now, or we will pay more later. Climate change and other
environmental threats will condemn our grandchildren to disease and diminished quality of life,
unless we begin to address it now. We can make extraordinary strides in conquering disease in
the future if we invest in basic scientific research today. And so on.
Expanding the winners' circle. For most Americans these are indeed the best of times
-- but there are still some for whom it is the worst. We must use this moment of unparalleled
opportunity to bring the poor into the middle class mainstream -- to expand the winners' circle so
the American dream can be lived by people who just a few years ago were written off. In this
new economy, we don't have a single person to waste. That is why we must do more to help
working families -- raising the minimum wage, protecting the EITC. We must do more to
prevent crime and keep our communities safe. And we must do more to help those Americans
who are struggling the hardest --we can't forget those who are left behind.
EXECUTIVE OFFICE OF THE PRESIDENT
COUNCIL ON ENVIRONMENTAL QUALITY
WASHINGTON DC 20503
98 NGV 11 PM10:14
November 11. 1998
MEMORANDUM FOR THE PRESIDENT
FROM:
GEORGE T. FRAMPTON, JR
GTFL.
SUBJECT: PROPOSED 1999 STATE OF THE UNION INITIATIVES
The following is a set of six potential State of the Union announcements for your consideration. In
some cases. these announcements have more than one part and could be presented as separate.
smaller announcements or packaged into a single, larger announcement.
A LANDS LEGACY
Action: You would announce a broad strategy or a series of targeted initiatives (depending on
available budget) built around a new vision of conservation with the aim of reconnecting people and
the land.
Background: Time and again over the past century, Americans have demonstrated their commitment
to preserving our greatest natural treasures. This Administration has added immeasurably to this
impressive legacy with steps to protect Yellowstone, the red rock canyons of Utah and California's
old-growth redwoods.
Increasingly, though, we face new conservation challenges that call for a new conservation ethic.
Having preserved so many of our "crown jewels" -- places prized precisely because they are pristine
and remote -- we must focus now as well on natural wonders in our very backyards. A conservation
ethic for the 21 st century recognizes people as part of the natural landscape. and seeks to preserve
natural and open spaces in each community, within reach of every citizen.
This approach is implicit in many of the Administration's conservation efforts -- for instance.
Everglades restoration, habitat conservation planning, and acquisition through the Land and Water
Conservation Fund of threatened lands near urban areas. This initiative would more fully articulate
this new conservation vision and set in motion collaborative strategies to fulfill it in both urban and
rural settings.
One vehicle for this initiative is an ambitious proposal by Interior called Partnership for America's
Resources. This proposal would draw on and significantly expand several existing funds, including
the Land and Water Conservation Fund, and establish new dedicated funding sources to generate a
total of about $3 billion a year through 2009. These funds would support a wide range of acquisition
and restoration programs at the federal, state and local levels. If the budget were to allow, this
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proposal would crown the Administration's solid conservation record, closing the century with a
dramatic achievement matching that of Theodore Roosevelt at the century's start.
An alternate approach would be a streamlined version of Interior's proposal that draws as well on
other agencies` resources and incorporates targeted tax incentives. Each element would cultivate
positive connections between people and the land. for instance by promoting sustainable forestry on
private lands. protecting farmland from development. supporting efforts that protect wildlife while
accommodating growth. or ensuring city and suburban dwellers easy access to nature and open
space. The initiatives could include:
Northern Forests - A collaborative effort with local government. property owners, the
conservation community and the states of New York. Maine. New Hampshire and Vermont
to preserve the natural and economic values of the largest contiguous wild forest in the
eastern United States. Up to 3.5 million acres now owned by timber companies are or soon
will be for sale. Disposition of this land will have profound impacts on the economy and
environment of this region.
Parks and Communities - A collaborative.effort with state and local governments and the
private sector guided by the vision of open space and recreation within walking distance of
every child in America. Eighty percent of Americans live in urban areas, and half have no
park or open space within walking distance of their home. This initiative could include a
commitment to create or rehabilitate 1000 parks or recreation facilities.
Farmland Preservation - Tax incentives and increased USDA funding to help preserve
farmland threatened by development. This is a key component of the livability agenda
launched by the Vice President, which highlights the close connection between loss of prime
farmland and runaway sprawl.
Lewis and Clark National Preserve - Redesignation of a stretch of the Missouri River in
Montana (now part Wild and Scenic River, part National Wildlife Refuge) to commemorate
the Lewis and Clark expedition, which explored the area in 1805.
Conservation Incentives - A targeted tax incentive that reduces tax on capital gains realized
through transfer of property that will remain under conservation easement.
Habitat Protection - Increased cost-share funding to acquire habitat in regions undertaking
comprehensive conservation planning to balance growth and endangered species needs (as
recently completed in Orange, Riverside and San Diego counties).
Cost: TBD, depending on scope.
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CLEAN AIR FUND
Action: You would propose $1 billion in new funding to provide low-interest financing for projects
that achieve early reductions in air pollution and/or greenhouse gas emissions. giving cities and
states a significant nonregulatory tool in the fight for cleaner air.
Background: One of the Administration's top environmental accomplishments is the adoption of
tough standards to reduce smog and soot. We also have proposed strengthening standards to reduce
regional haze in the West. While these steps have been well received by the public. many mayors
and governors continue to cite them as constraints on economic growth. These concerns. which are
likely to become more pronounced as the standards are implemented. stem in part from concerns
about the cost of compliance.
In addition, one of the Administration's top climate change priorities is encouraging early. voluntary
action to reduce greenhouse gases. Again. one barrier is concerns about the capital investment
necessary to achieve these reductions.
In the case of water quality, strong bipartisan majorities in Congress have long supported a revolving
fund to finance state and local infrastructure projects to reduce water pollution. This proposal would
take a similar approach to air emissions. For soot or smog-related emissions. funding would be made
available to states upon demonstration, consistent with EPA guidelines, that a project would achieve
reductions sooner than required, or from sources not subject to regulation. For greenhouse gas
emissions, funding would be made available upon a demonstration consistent with DOE guidelines
that the project would achieve "early" reductions that otherwise would not have been made.
Guidelines will ensure that the fund does not compensate polluters for taking action already required
by regulation.
We are reviewing with Treasury a number of possible models for the fund and for allocating
financing, ranging from the existing clean water state revolving funds to the school-construction
model to that used for low-income housing tax credit.
Cost: $1 billion annually in fund capitalization (outlay rates significantly lower, and may be reduced
over time by operation of a cost cap in the President's implementation plan for the new soot and
smog standards). Differential costs of alternative financing mechanisms TBD.
A NEW PARTNERSHIP FOR LAKES AND COASTS
Action: You would launch a new initiative to protect America's coasts and the Great Lakes, propose
new funding to help farmers combat water pollution, and call on Congress to reauthorize and
strengthen the Clean Water Act.
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Background: The five-year Clean Water Action Plan you launched earlier this year establishes a
solid framework for addressing the next generation of clean water challenges. principally nonpoint
source pollution. This initiative underscores some unfinished business -- reauthorization of the Clean
Water Act. and increased funding for farmers -- and targets additional resources to the specific and
urgent needs of the Great Lakes and coastal areas. Specifically. it would create a dedicated source
of funding (subject to state cost-sharing) to restore wetlands. accelerate cleanup of contaminated
sediment. and support local partnerships to restore estuaries.
Each of these issues has a strong economic component. Along the Gulf Coast. loss of wetlands raises
the risk of catastrophic damage from hurricanes and floods. Sediment contamination hampers urban
redevelopment. damages commercial and recreational fisheries in regions like the Great Lakes. and
undermines the competitiveness of our ports by increasing dredging costs. Pollution of estuaries
destroys commercial fisheries, threatens drinking water, and increases pollution control costs.
This initiative would: commit an additional $300 million a year to restore wetlands in Louisiana and
other Gulf states (this funding mechanism, a variation on the Landrieu-Dingell proposal. also would
support Everglades restoration); commit an additional $280 million a year for sediment cleanup and
natural resource restoration: and commit an additional $100 million a year to implement estuary
recovery plans developed in partnership with states and local communities.
Cost: $680 million.
In addition, the following proposals could be included in this initiative, or announced before the
State of the Union:
Save the Colorado Initiative - You would propose funding to remove uranium mine tailings
in Moab, Utah, that are contaminating endangered species and the Colorado River, a major
water source for California. The Atlas Corporation, which operated the mine, recently filed
for bankruptcy, making it inevitable under current law that the Department of Energy will
bear ultimate responsibility for the cleanup. Democrats and Republicans in both the
California and Utah delegations have united behind Congressman George Miller (D-CA) in
demanding that the tailings be moved. Governor Leavitt and Secretary Babbitt strongly
support the proposal. Cost: $125 million over five years, assuming Atlas will be able to pay
$7 million over the same period.
Helping Farmers Protect Water Quality - As part of your Clean Water Action Plan. you
requested $100 million in FY 1999 for a USDA program to help farmers control polluted
runoff. This funding was denied by Congress. As an alternative, you would announce
flexible use of Commodity Credit Corporation funds for the same purpose. USDA is
exploring how much funding could be made available this way. Cost: TBD
4
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ENVIRONMENT-TO-WORK INITIATIVE
Action: You would announce a $100 million-a-year initiative to train former welfare recipients and
other workers for jobs in environmental cleanup and energy efficiency: and to retrain timber
workers. miners and fishermen for environmental restoration work.
Background: One of the overriding themes of the Administration's environmental message is that
a healthy environment and a strong economy go hand in hand. Yet despite notable successes -- for
instance. brownfields cleanup and our Jobs in the Woods program in the Pacific Northwest --
environmental initiatives are not always seen as being in the interests of organized labor.
This interagency initiative would address these concerns in both urban and rural areas by providing
training for high-paying jobs in emerging environmental fields. In cities, it would train workers in
hazardous waste and brownfields cleanup, and in lead and asbestos abatement (jobs for which poorly
educated workers are often illegally recruited). In rural regions. it would build on Jobs in the Woods
to retrain timber workers in other regions where harvest levels are projected to decline; retrain
fishermen in areas with declining stocks to do habitat restoration; and train a new generation of mine
workers for mine reclamation and watershed restoration work. In addition. it would train workers
to conduct energy audits and perform other energy efficiency work in both urban and rural settings.
Cost: $100 million, with a portion funded from the Abandoned Mine Reclamation Fund.
PRESERVING AND EXPLORING OUR OCEAN FRONTIER
Action: You would announce designation of a new national marine sanctuary, set a goal of doubling
the number of marine sanctuaries over the next 10 years, and propose legislation to strengthen
protections within existing and new sanctuaries.
Background: At the dawn of the 20th century, under the leadership of President Teddy Roosevelt.
America committed itself to a new lands ethic, preserving irreplaceable pieces of our rich landscape
for all time. As we approach the 21st century, a comparable opportunity beckons off our shores. As
you noted in your address to the National Ocean Conference, the oceans are a vast frontier largely
unexplored, and largely unprotected.
Over the past quarter-century, the federal government has created 12 national marine sanctuaries
encompassing 18,000 square miles of coral reefs, kelp forests and other ocean ecosystems that are
home to a variety of endangered marine life. Management plans for each sanctuary are developed
in collaboration with nearby communities, commercial fishermen, marine-related industry,
conservationists, and marine scientists. The level of protection varies among the sanctuaries. with
some little more than boundaries on a map.
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There is a growing call from the scientific and conservation communities to both strengthen and
expand the sanctuary system. This proposal would meet both objectives. First. you would announce
the designation by the Commerce Department of a new sanctuary. (Prime candidates include
"seamounts" off California, underwater canyons and ledges off Cape Hatteras and Massachusetts.
brine pools and vents in the Gulf of Mexico, and waters off the Northern Mariana Islands.) Second.
you would set a goal of 24 sanctuaries -- double the current number -- by 2009. You could invite
Congress to work with the Administration in identifying areas for designation. Third. you would
propose legislation to set a minimum level of protection within the sanctuaries.
A new exploration venture by the National Geographic Society. in partnership with the Goldman
Foundation. presents an ideal opportunity to amplify our message. Dr. Sylvia Earle. former chief
scientist at NOAA and recently honored as Time Magazine's first Hero of the Earth. will explore
each of the existing sanctuaries in state-of-the-art submersibles.
Cost: An additional $6 million in FY 2000, $21 million in FY 2001. and $36 million in FY 2002.
DECLARING WAR ON ASTHMA
Action: You would launch a national campaign to halt the dramatic increase in asthma incidence
and, ultimately. to reduce by half the number of children who die from the disease or suffer severe
symptoms.
Background: Asthma afflicts more than 5.5 million children in America and is the leading cause of
childhood hospitalization. The number of children suffering asthma has doubled in the past 15 years.
and the number dying from it has tripled in the last 20 years. Black and Hispanic children are twice
likely as white children to develop the disease.
The Administration has launched several efforts to combat asthma. including tougher air quality
standards and recent grants to universities to establish environmental health research centers. This
initiative would expand successful programs by HHS and EPA to reduce asthma risks in schools and
homes through education. It also would support additional monitoring and research to better track
incidence and develop potential cures.
Cost: $55 million.
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THE WHITE HOUSE
WASHINGTON
98 NUV 11 -10:15
November 10. 1998
MEMORANDUM FOR THE PRESIDENT
FROM:
NEAL LANE neal
SUBJECT:
1999 State of the Union Address
This memorandum makes recommendations for themes to include in your next State of the
Union Address to underscore your vision for the 21st century. The emphasis is on cementing
your leadership in science and technology, a theme that should generate substantial bipartisan
support.
Background
You have been consistent and eloquent about your commitment to investing in America's future.
Every year of your presidency you have increased the S&T budget. The Research Fund for
America -- an unprecedented proposal for support of S&T in your FY 1999 budget request -
fared extremely well in Congress. You have helped to persuade the American people that
continued American leadership in the world and a better quality of life for all Americans depend
on our enduring commitment to research and to technology. You have secured a broad
consensus that we have a responsibility to develop technology for public needs.
The following are suggested themes for your consideration.
1.
Information Technology Research Initiative
Why: Information technologies have the potential to do for the creation and management of
knowledge what the invention of electricity did for the production and distribution of
power. Electricity not only was a good substitute for candles and steam engines, it
empowered every American family and every American business by making energy
affordable and accessible. New information technologies can provide every American
with an extraordinary set of tools - whatever their age and health and wherever they live.
They can allow families to stay in touch, enable small businesses to participate in
international alliances, and make it possible for employees to keep up with job
opportunities and get the training they need. These technologies have the power to
strengthen our military forces and make them more adaptable to a complex range of
threats, improve health services, provide unprecedented opportunities for persons with
disabilities, expand learning opportunities for people of all ages, strengthen crime-
fighting, protect the environment, and create more accessible and efficient government.
In the years ahead, information technologies will continue to be a driving engine of
economic growth and job creation. Their contribution is already astonishing Between
1995 and 1997, firms associated with these technologies contributed one third of US
economic growth; in 1996 the industry employed over 7 million people in the US. These
technologies have greatly strengthened our competitive position in international markets
because our uniquely flexible industries have been quick to recognize and seize the
opportunities these technologies offer.
Computing and information technology research is also essential to avoiding major
vulnerabilities that our information-rich economy is beginning to encounter. We are
increasingly dependent on powerful information tools to manage air and highway traffic.
financial networks, medical information systems, and many other parts of the critical
infrastructure that support our economy. New tools are required to design information
systems that will remain reliable and secure.
Information technology (IT) has made research in all scientific fields more productive,
while accelerating the pace of scientific discovery. Predicting climate change, or
sequencing the human genome, for example, would not be conceivable without powerful
computational tools. New information tools are essential if we are to convert our
knowledge of the human genome into an understanding of how the genes actually work,
and to develop practical tools for combating disease and disability.
In your June 1998 MIT commencement speech, you highlighted the importance of
information technology to America's future by indicating your intention to call for
"significant increases in computing and communications research" in your FY 2000
budget. Your IT Advisory Committee, in its recent interim report, assessed the current
Federal effort in information technology research and has made a number of solid
recommendations as to how additional funding could be most effectively used.
What: Major new research programs in DARPA and NSF targeted on advanced software design,
making information systems easy to use, and managing the high-speed, flexible
communication systems emerging to link billions of computing devices embedded in
everything from cell phones to TV sets. Long-term, high risk research on advanced
computation and communication (cryogenic devices, DNA and quantum computing).
In these agencies, as well as NIH, DOC, DOE, and NASA, funding the procurement of
high-speed computers for medical, environmental, and other scientific research, and
funding to help these communities make full use of these new tools.
Cost: $200-300M in FY 2000; $3B over five years.
2.
Millennium Research Fund
Why: Such a Fund would reaffirm your commitment to lead America into the 21" century with
investments that improve the quality of life and keep the economy growing. Half of our
economic productivity in the last half-century is attributable to technological innovation
and the science that supported it. The knowledge-based society of the next century only
increases the importance of research, innovation, and human capital as our principal
strengths. This fund would build on the success of the Research Fund for America.
expanding its scope to include all civilian and university-based research. It would also
trump the non-specific Congressional proposals to "double" research funding with a
detailed plan for strategic growth in S&T budgets.
What: A commitment to substantial. sustained support for a balanced portfolio of civilian and
university-based research, including DOD 6.1 and 6.2., to ensure continued US
leadership across the scientific frontiers. In addition to information technology, special
emphasis is given to research on vital national needs, including:
Biomedical -- Win the war on cancer and declare war on asthma, mental illness, and
heart disease.
Physical Science, Engineering, and Technology -- Develop new materials, chemicals
electronics, and manufacturing technologies essential to providing American
industries a competitive edge.
Global Change -- Ensure that regional economies, relying on agriculture or tourism,
prosper even in the face of climate change, and save the planet for future generations
Climate Change Technology -- Promote energy efficiency, the use of renewables, and
reduce greenhouse gas emissions.
Learning and Teaching -- Understand human learning by conducting basic research
and large-scale "clinical" trials of education practices, including education
technology.
Critical Infrastructure Protection -- Protect our infrastructure, from information
systems to power systems, against terrorist threats, natural disasters, and human error.
Aviation Safety and Security -- Reduce aviation fatal accident rate by a factor of five
within 10 years.
Emerging Infectious Disease -- Reduce the threat of bioterrorism and the
vulnerabilities to reemerging diseases, such as tuberculosis.
Ecosystem Sciences -- Eradicate the algal blooms and other water problems that
threaten fisheries and other U.S. coastal businesses.
Plant Genome -- Breed pest- and drought-resistant plants that ensure America
continues to feed the world.
Transportation -- Foster breakthrough automotive technologies, achieve threefold
improvement in fuel efficiency by 2004.
Food Safety -- Eliminate deaths and illnesses from food poisoning.
Cost: Doubling the Federal investment in these research areas over ten years would
require approximately $3B in FY 2000 (7% increase); and $20B over five years.
THE WHITE HOUSE
98 NOV 11 PM10:15
WASHINGTON
November 6, 1998
MEMORANDUM FOR THE PRESIDENT
FROM:
TODD STERN
SUBJECT:
State of the Union Climate Change Ideas
Last year's State of the Union included a substantial section (16 lines) on climate change. Our
specific announcement was your five-year, $6 billion program of tax cuts and R&D to spur
energy efficiency and the development of renewable energy. This year's environmental section
of the speech should, of course, include climate change. Below are three specific deliverables
that could be included in the speech.
Getting Energy Efficient Products into Our Homes. While R&D into new energy saving
technologies is extremely important, economists also recognize that we could achieve enormous
reductions of greenhouse gases if consumers took advantage of the energy saving products
already in the marketplace. You could announce a new initiative to help move a designated list
of several major Energy Star products (e.g., refrigerators, washing machines, air conditioners,
furnaces) off the shelves and into consumers' homes. The initiative would consist of the
following elements: (1) a partnership with major manufacturers to launch a campaign to inform
consumers about the financial and environmental benefits of retiring older appliances early and
replacing them with new, energy efficient models. (The retired products would be recycled,
producing further energy savings.) DOE has been engaged in discussions with GE, Whirlpool,
Maytag, Amana and White Consolidated, who are all prepared to participate; (2) rebates from the
manufacturers and/or electric utilities; (3) federal financial incentives, which could take the form
of tax incentives or rebates. Rough estimates suggest that for a cost of around $1 billion
annually, the federal government could provide an incentive equal to around 10% of the purchase
price of selected Energy Star equipment. This program could save millions of tons of carbon
emissions annually and save consumers hundreds of dollars a year on their energy bills.
Bioenergy Growing an Alternative to Fossil Fuels. Biomass represents a major potential
resource for our energy future. It can be used to make fuel, burned directly to produce electricity,
and used for the production of chemicals. By growing products like switch grass on idle
cropland and putting agricultural and wood waste to good use, some experts predict we could
eventually produce energy equivalent to more than half of our current annual crude oil imports.
You could launch a partnership with farmers, the forest products industry, power companies,
chemical companies and others to develop a clean, biomass-based energy industry. Such an
initiative would not only be good energy policy, but would give farmers something to like about
dealing with climate change. Senators Lugar and Harkin, among others, are very interested in
biomass. DOE and USDA are already making substantial investments in bioenergy. We can do
this initiative with funding that fits within the total available for the second year of the five-year
Climate Change Technology Initiative you announced last year.
Financing of Clean Energy Projects. The CEQ State of the Union memo includes an idea for a
revolving fund to finance state and local infrastructure projects to reduce air pollution or
greenhouse gases. The idea would be to fund projects achieving early reductions that wouldn't
otherwise be made. For a full discussion of this idea, see the CEQ memo.
THE HARV ARD LAW SCHOOL
11
CAMBRIDGE MA 02138
November 11. 1998
MEMORANDUM FOR THE PRESIDENT
Through: Maria Echaveste
Deputy Chief of Staff
From:
Christopher Edley, Jr.
Professor of Law
Re:
Race and the State of the Union: A "Vision" Option and a "Program" Option
My premise is that I will deliver a virtually complete draft of your race book in December, but
the final product will not be released until after the SOTU.
Vision Option: Building on some of the rhetoric from SOTU'98 and SOTU'97, summarize the
vision of One America with racial and ethnic justice that will be the centerpiece of your race
book. In these paragraphs you would veer sharply away from the familiar laundry lists of the
Policymaker-in-Chief to instead demonstrate and exploit your unclouded title to the bully pulpit.
In brief: The America you envision for the 21st century must have opportunity so broad
and deep that there is no visible legacy of slavery or conquest or colonialism. It must
have communities so open and inclusive that each of us celebrates the richness of our
diversity, as that diversity fuels not our fears, but our strength. And, in that America, our
hearts will be healed of the prejudices and stereotypes that too often divide us today; our
vigilance will prevent the wounds from ever reopening. We can chart our progress
towards this vision as we close the disparities in educational achievement and in
victimization by violent crime; as we slowly reverse the trends towards racial and ethnic
separateness in our communities and schools; and as we finally win the battles to combat
the oppressions of discrimination and stereotype.
Since you will have discussed education, welfare-to-work and other opportunity measures, you
can briefly note that these are elements of how we can achieve the vision. You can praise the
work of religious leaders, higher education leaders and others in advancing this vision, and
announce the follow-on entity to continue the race initiative.
Program Option: After noting that you will soon release your report on the race initiative, you
would highlight two or three substantive "mountain tops" in your policy workplan for the nation.
(The book will contain more mountain tops and abbreviated mention of foothills.) Possibilities:
(1) Educational achievement: Your vision requires that the nation undertake a more focused,
dramatic and sustained effort to tackle the intolerable achievement disparities between poor and
rich, between minority and non-minority. The era of excuses is over -- for everyone.
Recommendation. Provide large-scale grant-in-aid support to states and or metropolitan areas that
commit to develop comprehensive, peer-reviewed plans for removing resource inequities.
enhancing accountability, and eliminating disparities in student achievement. (This builds on the
Comprehensive School Reform Demonstration Program. but is far more substantial in scale. less
prescriptive, focused on systems rather than individual school sites. and with accountability for
results). The undertaking parallels your announced goal of narrowing health disparities. Instead of a
formula program like Title I, this substantial "honey pot" would not attract participation from all
jurisdictions initially, which is fine.
(2) Jobs: We must break the back of the endemic hyper-unemployment of young adults in our
most distressed poor communities, eventually eliminating the racial and regional disparities in
joblessness. Recommendation: Challenge states and metro area jurisdictions to raise the
employment rate of young adults in distressed neighborhoods through regional strategies.
Provide substantial new resources and greatly enhanced flexibility with categorical federal and
state programs, for interested jurisdictions willing to accept accountability for creatively tackling
the especially difficult problems of young adult unemployment. Flexibly link programs in
education, training, job search, transportation, employer networking, day care, housing
assistance, drug treatment, and many more. But results must matter.
(3) Economic Development: We can do more to harness the power of financial institutions and
markets to create opportunity in distressed communities here at home, just as we try to do
abroad. Recommendation: The Federal Home Loan Bank Board system in years past helped
make home ownership a reality for many. In the new century, the FHLBB should have a new
mission: working side-by-side with CDFIs to fuel economic revitalization in our most distressed
communities through affordable financing of a range of job-creating projects.
(4) Combating Discrimination and Hate : The fight against ordinary discrimination is not
finished. Last year's budget included an increase for some civil rights law enforcement agencies,
to help those standing in line waiting for justice. Now, we must sustain that investment and
extend it to other enforcers of our basic rights - the civil rights division in the Department of
Justice, the Office for Civil Rights in the Department of Education, etc. As we do so, we can re-
engineer those efforts to emphasize voluntary compliance, technical assistance, education and
dispute resolution. And complementing this law enforcement effort is the business of healing
communities threatened by racial and ethnic division. The Community Relations Service has
been an often unsung hero, with a few dozen public servants bringing wisdom and hope to
community after community, after church burnings and riots - and before disturbances flare up.
The nation needs to invest in this resource to create One America.
In these policy examples, I am urging you to address underlying structural problems, eschewing
band-aids and incrementalism. Whether or not you use them in the State of the Union, I hope you
will consider them for FY 2000 and the future.
Recommendation: For the SOTU, as much as I like the policy ideas, I recommend the bully
pulpit option.
Jen:
This is an excerpt of a document we did for Bruce and Elena that references the health care items
that I would recommend Shirley pushing. I divided them into two categories:
1. Proposals initiated by the First Lady's office.
2. Health care priorities that I think the First Lady would want to push.
Call me with questions. Thanks a lot.
cj
Jenn just
received this from
Chris &thought
you might need
this NOW
[
GROUP ONE:
Medicaid for foster care children. (new First Lady's office initiative) Children who grow up
in foster care arrangements often are less prepared for the challenges of adulthood; their rates of
unemployment and lack of insurance are much higher than average. This policy allows states to
continue Medicaid coverage for foster care children who turn 18 and lose Medicaid eligibility
(extended through age 23). This policy is supported by HHS, OMB, DPC and NEC.
Cost. HHS estimate: $50 million over 5 years
Status / Recommendation. OMB is supportive if funds are available. We assume that this
initiative will make the final cut without much of a push from you.
Medicaid Asthma Initiative. (new First Lady's office initiative). Over the past 15 years, the
number of children afflicted with asthma has doubled to total about 6 million. HHS's initiative
(described in the discretionary program list) includes grants through the Public Health Service.
OMB has proposed that HHS provide competitive start-up grants for states to develop disease
management programs through Medicaid. This both links the funding with the Medicaid
providers who most often see these children and takes some of the pressure off of the
discretionary budget.
Cost. OMB estimate: $50 million in 2000
Status / Recommendation. OMB is supportive if funds are available. We assume that this
initiative will make the final cut without much of a push from you.
can
Providing needed education funds to children's hospitals. (new First Lady's office initiative)
propersi
Medicare has invested billions of dollars in graduate medical education to hospitals since 1966.
However, because of its current distribution formula, free-standing children's hospitals are forced
to shoulder the majority of the cost of training pediatricians, placing them at a severe financial
disadvantage. This proposal creates a new discretionary grant program to provide GME funds
what ber? does t
through the PHS in order to provide freestanding children's hospitals with Federal financing for
the cost of providing graduate medical education. This proposal is strongly supported by the First
Lady's office, DPC, and the National Association of Children's Hospitals. HHS does not oppose
this proposal, as long as it is not funded through the Medicare trust fund.
Cost. Original DPC cost estimate: $285 million
Issues. OMB is strongly opposed to this proposal because they believe that the children's
hospitals are financially stable and do not need additional federal assistance.
Response / Recommendation. We believe that there is a legitimate equity argument here, as these
hospitals shoulder much of the responsibility for training the nations' pediatricians and pediatric
subspecialists. The current proposal is one seventh of the amount proposed by the children's
hospitals, but would still be supported primarily because it would address the inequities faced by
facilities training pediatricians and other pediatric subspecialists. We will need to push hard to
get any funding here. When this proposal is contrasted with other priorities in the budget, this is a
tough sell. (You have come way down on the costs, though.)
Status.
OMB: +(0); WH Need: +$40 million
GROUP TWO:
Family Caregiver Support Program. (new initiative) Approximately 22.4 million U.S
households provide caregiving services that currently enable their elderly relatives to remain in
the community, providing services that would cost over $100 billion annually if provided by
home health care aides. This proposal creates a new national program through the
Administration on Aging to support Americans who care for chronically ill or disabled family
member or friends. It provides State grants for "one-stop-shop" access point to provide
services, such as information and counseling as well as respite services and adult day care.
This proposal is a priority for the Vice President, DPC, and NEC, and viewed by OMB as a solid
initiative.
Cost. Original HHS cost estimate: $150 million
Response / Recommendation. The OMB passback level prevents the establishment of a
national program, providing only enough funds to establish systems in a limited number of
States. This policy is a critically important component of the long term care initiative, as it
complements the long term care tax credit. Funding of this proposal is necessary to obtain
broad based validation from the advocacy community for our entire long term care package.
This is a great women's issue for the First Lady to push.
Status.
OMB passback: +$10 million; WH need: additional +$140 million; HHS appeal:
additional +$140 million
Investing in DoD cancer research programs. (new DPC proposal) Every year the Congress
funds programs at DoD for prostate and breast cancer research. While every White House
principal has highlighted these innovative, widely acclaimed research programs, we have never
proposed a single dollar for them in our budgets. We are also proposing an investment in
osteoporosis research at the DoD.
Cost. Original DPC estimate: $250 million
Issues: DoD is likely to be resistant to this concept as they believe that although they have
developed a model program in response to a Congressional mandate, biomedical research is
not within their military mission.
Response: Because the Defense budget will be so large this year, we believe it to be an
opportune time to push for significant funding increases in research for diseases such as
osteoporosis, cancer, and heart disease. This is probably important, because increases in the
NIH budget will likely be very low this year. Also, those diseases have an obvious and
disproportionate impact on women.
Status.
OMB: +(0); WH Need: earmark $200 million of DoD increase
Enhancing mental health services. (new Tipper Gore initiative) Approximately 44 million
adults and 14 million children suffer from a mental disorder annually. This proposal increases
funding to SAMHSA to enable states to provide critical mental health services, including access
to prevention and treatment services and providing new incentives to communities who have
implemented effective mental health programs. This proposal increases funding to SAMHSA as
well as raising awareness about mental health through enhancing the current level of funding
provided to States through the mental health block grants. This proposal is strongly supported by
the Vice President's office and Tipper Gore's office.
Cost. Original HHS cost estimate: $146 million
Response /Recommendation. The mental health community would strongly reject OMB's
contention that research grants in any way substitute for support for direct services. Moreover, it
would be extremely embarrassing for Mrs. Gore and the White House in general to defend such a
poor funding stream for mental health at a time when we plan on hosting a White House
Conference on Mental Health for this spring to raise awareness about mental illness. In addition,
next year, HHS will release a Surgeon General's report documenting the widespread incidence
and impact of mental illness. Therefore, we believe it is critical to make a new investment in
mental health services. This is not absolutely necessary for a push, but would be a nice thing
to do on behalf of Tipper Gore.
Status.
OMB passback: +(0); WH Need: +$100 million; HHS appeal +$116 million
Possible Settleout Range
Request
Low
High
CEQ
Costal Salmon
125
100
100
Lands and Livability
500-750
375
375
Clean Air Fund
250
250
250
HHS
CDC
75
60
60
Long-Term Care
150
150
150
AIDS
28
28
CBC AIDS
50
50
Mental Health (SAMSHA)
75
65
65
Race and Health
50
50
50
Children's Hospital
40
40
40
Tobacco -- PH CDC
27
27
27
Tobacco -- FDA
66
32
32
Educational Research - NIHD
25
10
15
Food Safety
50
40
40
Education
Adult Literacy
255
110
180
Social promotion
350
350
350
Quality
18
18
Urban/Rural Computing
75-100
60
60
Shift general Ed Tech increase
[25]
TLC
41
41
Charter Schools
9
5
10
Stay in College
50-100
25
25
Title I Accountability
250
0
0
Technology for Disabled
40-60
35
35
Native Americans
10
10
10
Education Research
25
Labor
Universal re-employment
300
210
250
Youth employment
212
170
170
FMLA/Paid Leave
8
8
8
Child Labor
Enforcement
3
Standards
40
40
40
Equal Pay
20
20
20
NLRB
10
10
10
458
458
Urban Instituto Ini tiat
SBA
238
Treasury
25
HUD Abandoned buildings
100
50
50
Treasury
Firearms
25
15
15
Americorps
100
80
80
Child Labor
20-30
Microcredit
10
10
10
Deduct Education
-500
-500
Total
2502
2592
+
12/15/98 03:56 PM
+Russia
CHILD CARE AND DEVELOPMENT BLOCK GRANT
Policy and Cost. We propose to expand the Child Care and Development Block Grant (CCDBG)
at a cost of $10.5 billion over 5 years, and to maintain the structure that we proposed last year to
devote $7.5 billion to expand subsidies and $3 billion to support early childhood education and child
care quality. This will maintain last year's level of commitment to new mandatory dollars for child
care subsidies and quality.
We will more affirmatively package the overall investment as an increase in the block grant, with
a portion reserved for community-based child care improvements. With the additional $7.5 billion
over five years for child care subsidies (assuming the 80/20 match advanced last year), one million
more children will be served, for a total of 2.25 million children in 2004. The $3 billion will go to
communities to support early childhood education, home visiting and parent education, and child
care quality improvements for infants and toddlers.
Unresolved Issues and Objections. Our goal is to maintain our commitment to the significant
child care initiative that the President put forward last year, while repackaging the proposal as a
commitment to increasing the block grant for both subsidies and quality child care, rather than as
a new separate program for early learning.
It is clear that our proposal will be judged by the advocacy community primarily on the funding
level, so that it is important not to lower our commitment below $10.5 in mandatory funds.
We believe that we need to maintain a strong commitment to child care quality and early childhood
education. Many advocates, as well as some Member of Congress such as Senators Kerrey and
Kennedy, have similarly argued that we should not retreat from the early learning fund. As you
know, we had floated the idea of collapsing the early learning fund and building on the existing set-
aside in CCDBG for infants and toddlers. While the advocates are somewhat open to altering our
proposal given the difficulty of obtaining authorization for a new program, most see using the set-
aside as an endgame and view our best starting position as a commitment to last year's proposal.
In addition, given that the infant and toddler set-aside is currently only $50 million, it would be
difficult to imagine raising it to $600 million per year and would therefore most likely endanger the
funding level for early learning. Finally, some advocates strongly support targeting any new quality
dollars to communities, rather than to states, a goal that will be difficult to meet if we build on the
existing set-aside. Therefore, we propose to maintain our commitment to the balance between
subsidies and quality advanced last year, because, regardless of its prospects for passage, it is
considered the best starting point to congressional negotiations and addresses the growing need to
target dollars to the community level.
Status. HHS and NEC continue to support maintaining the Early Learning Fund. We have not had
extensive discussions yet with OMB.
FMLA and Paid Leave Research and Evaluation Fund
Policy. The purpose of creating an FMLA/Paid Leave Research and Evaluation Fund is to
strengthen the foundation for innovation in the States toward providing paid parental leave
benefits for lower-income American workers. Today, a few states are providing these benefits
and several states are exploring strategies to do so. However, many unanswered questions
remain. This fund would serve to (1) explore how best to structure paid leave delivery systems;
(2) evaluate current state systems; and (3) support state efforts to design or explore paid leave
systems, e.g. through a state paid leave commission. In addition, this fund would provide needed
resources to update the data in the 1995 national FMLA Commission leave study, to answer
important questions such as how many Americans have benefited from the FMLA since its
enactment.
Cost. The cost of this FMLA and Paid Leave Research and Evaluation Fund is $10 million for
FY 2000; it would be administered by the Department of Labor.
Objections and Status. The DPC has engaged in discussions primarily with the Department of
Labor to explore a number of paid leave policy options -- including a federal system of providing
benefits, a demonstration fund, and research and evaluation efforts -- and has determined with
DOL input that a research fund is a necessary foundation for either of the other more ambitious
options. While OMB has been involved in broader discussions of paid leave, we have not
discussed the research fund with them.
Head Start Expansion
Policy and Cost. The purpose of our Head Start expansion policy is to reach the President's
goal of serving 1 million children with Head Start services by the year 2002. The 1999
reauthorization of Head Start made that goal more expensive to accomplish because it increased
significantly the percentage of expansion dollars (new money in the program) that must be
targeted to quality, rather than to serving more children. Before the reauthorization, twenty-five
percent of expansion dollars were targeted to quality; under current law, the quality percentage
rises sharply but phases down over time -- 50 percent in FY 2000, 47.5 percent in FY 2001, and
35 percent in FY 2002. Another factor making it difficult to meet our goal is the gradual
expansion of Early Head Start, which carries a more expensive per-child cost. OMB and HHS
also disagree about the per-child cost of Head Start services.
Our FY99 budget (before the reauthorization) assumed the creation of 44,000 new slots in FY00,
for a total enrollment of 910,000. OMB advises that adding 44,000 slots in FY00 under current
law requires a funding level of $5.266 billion. Due to lower than projected participation rates in
1997 and 1998, however, adding 44,000 new slots brings the program to only 881,000 and would
require $5.8 billion over the five-year guidance levels to achieve our goal. Reaching 910,000
slots in FY00, as assumed in the FY99 budget, would require over 70,000 new slots in FY00,
costing $6.6 billion over the five year guidance level to reach our goal.
OMB estimates that its FY00 Head Start guidance level -- $4,997 billion -- will allow the
program to add about 20,000 in FY00, for a total enrollment of 857,000. Under this scenario,
reaching the 1 million by 2002 would require adding 71,000 new slots in each of FYS 2001 and
2002, which, OMB calculates, would cost roughly $5.3 billion over the five year guidance levels.
HHS' amended request (after the reauthorization) and appeal for Head Start for FY00 is $5,395
billion, with which they propose to create 54,000 new slots for a total of 892,000 slots in 2000.
Objections and Status. OMB anticipates that the discussion of the FY00 and out-year Head
Start funding levels will take place during Shalala's meeting with Lew. The options to be
considered will be (1) commit to the goal and invest the dollars necessary to reach it; (2) commit
to reaching 1 million children but over a longer time, e.g. by 2004; (3) walk away from our goal.
The DPC should affirm that we must determine and commit to a path to reach the 1 million
participation goal, perhaps over a longer period.
CHILD WELFARE: CHILDREN AGING OUT OF FOSTER CARE
Policy and Cost. We recommend advancing several proposals to assist young people who "age
out" of the foster care system, i.e. who enter the foster care due to abuse and neglect, are unable
to return to their birth families, and do not find permanency with an adoptive family. Federal
financial support to them ends just at the time they are making the critical transition to adulthood.
First, we propose to significantly increase the Independent Living program, the main federal
program that assists this population. Working essentially as a block grant to states and
administered by HHS, the program provides services to support these young people as they earn
a high school diploma; receive vocational training and education; and learn daily living skills
such as budgeting, career planning, and securing housing and employment. The Independent
Living program has not been increased since 1992; increasing this mandatory program by 50
percent, as we propose, will cost $175 million over five years.
Second, we propose to increase the Transitional Living program, a discretionary program
administered by HHS which provides funds to local community-based organizations for
residential care, life skills training, and other support services to homeless adolescents, ages 16-
21. Unlike the Independent Living program, this program is able to fund housing. We propose
to increase the program by $5 million in FY 2000, up from $15 million in FY 1999.
Third, we propose to ensure Medicaid coverage for this population up to age 24 (see DPC Health
Team memo), for an estimated cost of $50 million over four years. Finally, we propose to extend
IV-E eligibility for federal maintenance payments beyond age 18 for certain purposes, for a cost
of approximately $50 million over five years.
Objections. HHS and OMB have been extremely receptive to advancing a multi-faceted
proposal in this area. The child welfare advocacy community is also highly supportive.
Cost Overview and Status.
(1)
Independent Living program (Mandatory) -- $175 million over five years to increase the
program by 50 percent. HHS requested this increase and OMB included it in its
passback.
(2)
Transitional Living Program (Discretionary) -- $5 million increase over FY 1999 for a
total of $20 million. HHS did not include this in its request, but OMB included it in its
passback.
(3)
Medicaid coverage (Mandatory) -- $50 million over five years. HHS did not include this
in its request; OMB included in its passback.
(4)
IV-E Eligibility Extension (Mandatory) -- $50 million over four years. HHS did not
request; OMB planning to include in a later passback.
Expansion of the DCTC to Provide Benefits to Stay-at-Home Parents
Policy: We propose to extend the benefits of our Child and Dependent Care Tax Credit
(CDCTC) (as we proposed to change it last year) to stay-at-home parents with young children, by
assuming minimum child-care expenses of $600 per year.
The CDCTC is equal to a percentage of the taxpayer's employment-related expenditures for child
or dependent care, with the amount of the credit depending on the taxpayer's income. The
CDCTC proposal we advanced last year would increase the credit from its current rate of 30% to
50% for those with incomes under $30,000, and gradually phase it down to 20% at $59,000 of
income. This proposal, which only provides a credit to families with actual child care expenses,
costs $4.5 billion over five years, under current economic assumptions. (This is actually $.3
billion less than Treasury's estimate last year, which was $4.8 billion.)
This year, we propose to build on the CDCTC proposal we put forward by allowing all families,
including those where one parent does not work, with a child under the age of two to have
assumed expenses of $600 per year per child. Under this proposal, the maximum allowable
expenses for those with actual child care costs would increase from $2,400 to $3,000 for one
child and $4,800 to $6,000 for two children. The maximum benefit for a stay-at-home family
with one child under one would be $300.
Cost: The cost of this proposal and our CDCTC proposal is $6.1 billion. However, it only
requires $.8 billion in new dollars because Treasury now estimates that the CDCTC proposal we
put forward last year is $.3 billion less than they had previously estimated, and we are replacing
the business tax credit, which is $.5 billion, with this proposal.
Unresolved Issues and Concerns: The child care and women's community is supportive of
advancing a proposal that benefits families in which one parent stays at home, but oppose doing
so at the expense of the CDCTC proposal we put forward last year. Therefore, they strongly urge
that any benefits targeted towards stay-at-home families must be on top of last year's proposal.
Status: We have worked closely with the Treasury Department to develop this proposal. While
they have raised concerns regarding the merits of proposals to help parents who stay at home,
they are generally supportive of this proposal.
PRESIDENT CLINTON'S PROPOSAL:
CHILD CARE THAT STRENGTHENS AMERICAN FAMILIES
"Not a single American family should ever have to choose between the job they
need and the child they love.
President Bill Clinton
State of the Union Address, January 27, 1998
President Clinton announced an historic initiative to improve child care for America's working
families. The initiative proposes over $20 billion over five years for child care -- to help
working families pay for child care, build a good supply of after-school programs, improve
the safety and quality of care, and promote early learning.
ENSURING AFFORDABLE, ACCESSIBLE, SAFE CHILD CARE. The President's child care initiative
responds to the struggles our nation's working parents face in finding child care they can
afford, trust and rely on. The new initiative:
Makes child care more affordable for working families. To help working families
struggling to meet the costs of child care, the initiative invests $7.5 billion over five
years to double the number of children receiving child care subsidies to more than two
million by the year 2003. The initiative also invests $5.1 billion over five years to
increase tax credits for child care for three million families and provides a new tax
credit for businesses that offer child care services to their employees at a cost of $500
million over five years.
Increases access to and promotes early learning and healthy child development.
To improve early learning, the initiative includes $3 billion over five years to establish
an Early Learning Fund that helps local communities improve the quality and safety of
child care for children ages zero to five. The initiative also increases investment in
Head Start and doubles the number of children served by Early Head Start to 80,000.
Improves the safety and quality of child care. To help ensure safe, quality child care,
the initiative: steps up enforcement of state health and safety standards in child care
settings, facilitates background checks on child care providers, increases scholarships and
training for child care providers, and invests in child care research and evaluation.
Expands access to safe after-school care. To help create safe, positive learning
environments for American school-age children who lack adult supervision during a
typical week, the initiative increases the 21 st Century Learning Center Program by $800
million over five years to provide after-school care for up to half a million children a
year.
MAKES CHILD CARE MORE AFFORDABLE FOR WORKING FAMILIES
Doubles the Number of Children Receiving Child Care Subsidies to More than Two
Million. The President proposes to expand the Child Care and Development Block Grant to help
working families struggling to meet the costs of child care. This block grant is the primary
federal subsidy program to pay for child care, enabling low-income parents to work. Funds are
distributed by formula to the states to operate direct child care subsidy programs, as well as to
improve the quality and availability of care. The President's initiative will more than double the
number of children served from the one million served in FY 95 (the latest year for which data
are available). The President's budget will increase funding for the block grant by $7.5 billion
(with a match) over five years, which will enable states to provide subsidies for more than two
million children by 2003.
Increases Tax Credits for Child Care for Three Million Working Families. The Child and
Dependent Care Tax Credit provides tax relief to taxpayers who pay for the care of a child under
13 or a disabled dependent or spouse in order to work. The credit is equal to a percentage of the
taxpayer's employment-related expenditures for child or dependent care, with the amount of the
credit depending on the taxpayer's income. The President's proposal increases the credit for
families earning under $60,000, providing an additional average tax cut of $358 for these
families and eliminating income tax liability for almost all families with incomes below 200% of
poverty ($35,000 for a family of four) that take the maximum allowable child care expenses
under the law. The President's budget will include $5.1 billion over five years to expand the
Child and Dependent Care Tax Credit for three million working families.
Provides New Business Tax Credits. The child care initiative includes a tax credit to
businesses that provide child care services for their employees, by building or expanding child
care facilities, operating existing facilities, training child care workers, or providing child care
resources and referral services to employees. The credit covers 25% of qualified costs, but may
not exceed $150,000 per year. The President's budget will include approximately $500 million
over five years for these tax credits.
PROMOTES EARLY LEARNING AND HEALTHY CHILD DEVELOPMENT
Promotes Early Learning. Research shows that children's experiences in the earliest years are
critical to their development and future success. The President's proposed Early Learning Fund
provides challenge grants to communities (distributed by states) to support programs to improve
early learning and the quality and safety of child care for children ages zero to five. Funds may
be used for the following activities: providing basic training to child care providers (including
first aid and CPR); connecting individual child care providers to centers for education and
support; assisting child care providers to meet accreditation and licensing requirements; linking
child care providers with health professionals; reducing group sizes and child-to-staff ratios; and
providing home visits, parent education, and consumer education about child care.
The President's Early Learning Fund builds on state initiatives such as North Carolina's
Smart Start, which helps North Carolina's children enter school healthy and ready to succeed.
Smart Start funds a broad variety of local efforts, including improving staff-to-child ratios, health
linkages that have raised immunization rates, and parent education and mentoring programs to
give new parents support. The President's budget will include $3 billion over five years for this
fund.
Increases Investment in Head Start and Doubles the Number of Children Served by Early
Head Start. Head Start provides early, continuous and comprehensive child development and
family support services, preparing children for a lifetime of learning and development. The
President is committed to reauthorize Head Start and reach one million children by 2002. The
President's budget will invest $3.8 billion over five years to keep on track his commitment to
serving one million children by 2002, and to double the number of infants and toddlers in Early
Head Start to 80,000.
IMPROVES THE QUALITY OF CHILD CARE
Steps Up Enforcement of State Health and Safety Standards. Building on the military's
model child care program, this proposed initiative will fund state efforts to improve licensing
systems and enforce child care health and safety standards, including by increasing unannounced
inspections of child care settings. The President's budget will include $500 million over five
years for this program.
Facilitates Background Checks on Child Care Providers. On the day of the White House
Conference on Child Care, the President transmitted to Congress the National Crime Prevention
and Privacy Compact, which will facilitate effective background checks on child care providers
by eliminating state law barriers to sharing criminal history information for non-criminal
purposes. Although the vast majority of child care providers are dedicated to the teaching and
nurturing of children, one tragedy in child care is too many. Background checks are an important
way to ensure that the people watching our children are fit for this responsibility.
Increases Scholarships and Training for Child Care Providers. At the White House
Conference on Child Care, the President proposed establishing a Child Care Provider
Scholarship Fund to enable states to provide scholarship funds to students working toward a
child care credential. Eligible child care workers must commit to remaining in the field for at
least one year for each year of assistance received and will earn increased compensation or
bonuses when they complete their course work. The President proposed a federal investment of
$250 million over five years, which will support 50,000 scholarships per year. The President is
also proposing to expand the Department of Labor's Child Care Apprenticeship Program to fund
the training of child care providers.
Invests in Research. Because too little is known about our child care system, the President's
budget will increase support for data, research, and evaluation. This research fund will also
support a National Center on Child Care Statistics and a child care hotline that parents can call to
get information about how to find child care in their communities and how to identify
appropriate, quality care for their children. In addition, the research fund will support
demonstration projects to test approaches to help new parents who choose to stay home to care
for their newborns or newly adopted children. The President's budget will include $150 million
over five years for this fund.
EXPANDS AND STREAMLINES AFTER-SCHOOL CARE
An estimated five million school-age children spend time as "latchkey kids" without adult
supervision during a typical week. Research indicates that during these unsupervised hours
children are more likely to engage in at-risk behavior, such as crime, drugs, and alcohol use. To
meet this pressing demand, the President is proposing a dramatic expansion of after-school care.
Provides After-School Care for up to Half a Million Children a Year. The President proposes
a dramatic expansion of the 21st Century Community Learning Center Program to provide start-
up funds (with a local match) to school-community partnerships to establish or expand before-
and after-school programs for school-age children. The program increases the supply of after-
school care in a cost-effective manner primarily by funding programs that use public schools and
their existing resources, such as computers, gymnasiums, and sports equipment. The program
also includes a set aside to fund programs run by community organizations. The President's
budget will request $800 million of entirely new money for this program, for a total of $1 billion
over five years.
Improves Coordination of Federal After-School Initiatives to Help Communities Make Best
Use of Existing Resources. The President will put in place a collaborative effort involving
numerous federal agencies to eliminate duplication and better coordinate federal funding for
after-school programs in three to five pilot cities, including the District of Columbia.
FY00 Discretionary Initiatives
Initiative by Agency
Amount
($ million)
DEPARTMENT OF EDUCATION
Adult Literacy
355 180
Social Promotion/After School
350
benis top priorts
Teacher Quality
18m Troops to Teachers
0
Urban and Rural Computing Centers (or HUD or Commerce)
75-100 60
Charter Schools and Choice
9
Stay-in-College Initiative
50-100 25
Title I Accountability Fund
200
You Can Go to College Campaign
0
Technology for Disabled Americans
40-60 35
Native Americans
10
Education Research
25 ?
SUBTOTAL
1,014-1,109
660m
500
DEPARTMENT OF LABOR
Universal Re-employment
300
Youth Employment
Ec/42 ?. two
Sons
FMLA and Paid Leave Research Fund
8
Child Labor Enforcement
w)
3
40
International Labor Standards
40
lookat
Equal Pay (also EEOC)
20
maybe wrmt
SUBTOTAL
583
HHS
Bioterrorism
65
Superbug
10
Long-term Care (Family Support, Nursing Home Quality,
150
Medicare Limitation Education)
AIDs: Ryan White (28) and CBC Initiative (50)
78
Mental Health
7565
Race & Health
50
Rural Emergency Services
25 cut
Tobacco -- Public Health (CDC)
27
Tobacco -- FDA Enforcement
66
40
ca
Children's Hospitals
Education Research
25 - cut ,00/15
Food Safety (w/USDA)
50 50 40
SUBTOTAL
661
HUD
youthbirld
20 - part
70m
for
youth
50 100 ?
et
Abandoned Buildings
SBA
Trillion Dollar Roundtable
-Urbac
150
238
DEPARTMENT OF TREASURY
Trillion Dollar Roundtable (CDFI)
urban
25
Firearms Enforcement (w/DOJ)
2510
Financial Consumer Bill of Rights
an ed, not
25 10 or nothing
SUBTOTAL
75
EPA
Climate Investment Fund
250
DEPARTMENT OF COMMERCE
Coastal Salmon Restoration
125100
DEPARTMENT OF INTERIOR
Lands Legacy and Livability
375 500-750 ?
CORPORATION FOR NATIONAL SERVICE
100
15
1580
stretch to
DEPARTMENT OF STATE
st 85 or 90
Child Labor (AID)
isthis dabacount
20-30
Microcredit
10
SUBTOTAL
30-40
NSF
some
Information Technology Initiative
14-29
85
somered
Digital Library for Education (also Smithsonian)
20
SUBTOTAL
34-49
DEPARTMENT OF ENERGY
250
Global Climate Change -- Research and Technology (also Ag,
75
EPA, NSF,NASA,NOAA)
Russia Initiative (also State and DoD)
185-535
SUBTOTAL
260-685
AGRICULTURE
Integrated Science for Ecosystem Challenges (also NOAA)
50
VETERANS AFFAIRS
Smoking Cessation
90
DEPARTMENT OF JUSTICE
COPS II
650
Redirect Prison Funds to Coerced Abstinence and
100
Alternatives to Incarceration
Child Support
10
Medicare Suit (w/HHS,DoD,VA, OPM)
20
Child Welfare Judicial Reform
5
Abortion Safety
5
SUBTOTAL
790
DEPARTMENT OF DEFENSE
Information Technology Initiative
100
Smoking Cessation
60
Medical Research
200
SUBTOTAL
360
TOTAL
5.2-5.9
11
CC EK CJ
HEALTH
HUMAN to ATMENT SERVICES
JEN AK
THE SECRETARY OF HEALTH AND HUMAN SERVICES
WASHINGTON, D.C. 20201
Tom PJW
USA
CR
November 5, 1998
FYI-
Mostly stuff
we're alreade
doing
TO THE HONORABLE BRUCE REED, WH
-BR
This is the White Paper on Working Families we discussed. We think
a Domestic Policy led working group could pull together an exciting new
Presidential initiative for next year.
Donn 98hlole
Donna E. Shalala
Enclosure
Working Families Initiative
White Paper
Since 1993, the Clinton Administration has made working families a priority through increases in
the minimum wage and the Earned Income Tax Credit (EITC), through the Children's Health
Insurance Program, and through expansion of child care funding. Additional important
accomplishments include enactment of the HOPE Scholarship and Lifetime Learning tax credits, the
Family and Medical Leave Act, welfare-to-work housing vouchers and the Job Access program. In
addition, the strong economy has contributed to an increase in the number of working families.
Between January 1993 and June 1998, non-farm employment grew by more than 16 million net new
jobs, an increase of almost 15 percent. Unemployment has fallen from 7.3 percent to 4.5 percent,
while millions of new workers have joined the labor force.
Working parents in America should not have to worry about being unable to feed, house, clothe, or
access medical care for their children. Yet 5.3 million children under the age of 13 were poor in
1996 even though their families included an adult who was in the labor force for more than half the
year. Over 10.5 million children lacked health insurance coverage. This paper lays out an agenda
to move these families out of poverty through work and through strengthening the critical supports
to work, an agenda that builds on the considerable progress this Administration has already made
in supporting working families and preventing parents from having to choose, in the President's
words, "between the job they need and the child they love." The agenda proposed is a broad one,
not located in any single Federal Department or state agency, because there is no single magic bullet
that will ensure that low-income workers get jobs, keep them, succeed in them, and are able to meet
their families' basic needs. Rather, it will take the whole Administration working together, joined
by a wide range of public and private partners.
Our basic goal for working families should be that every working parent can provide for his or
her children's basic needs and for the family's health. This goal means that working parents
should be able to support their families at incomes above the poverty line. It also means, for
example, that they and their children should have enough to eat, that they should be able to find and
afford the child care and transportation that they need in order to work, that the care children receive
should promote their healthy development and safety, and that no working family should be forced
onto welfare because of a temporary interruption in work, or because earnings are so low or so
unstable that welfare seems the only way to provide for the family.
The Administration has made important progress toward this goal. For example, the
Administration's expansion of the EITC effectively gave a pay raise to about 18.5 million low-
income working families in 1996. Yet much is left to be done:
The Administration's successful efforts to increase the minimum wage and improve the
EITC have had a major combined effect on low-income families -- but families still struggle
to pay for child care, transportation, health insurance, rent, and food. For example, in 1992,
prior to the new policies of the Clinton Administration, a single mother with two children
working full-time at the minimum wage would have earned just $8,840 a year. After
subtracting federal taxes and adding the EITC and food stamps, her net income would have
1
been just $12,596. In 1997, after the Clinton Administration's changes, the same mother
would be earning $10,712 annually as a result of the minimum wage increase, and her EITC
payment would more than double, to $3,656. Including food stamps, her net after-tax
income would increase to $16,777. (See Attachment A.)
Yet while her family's total income is now above poverty, this mother still is at considerable
risk of failing to meet her children's needs and perhaps having to leave her job if something
goes wrong. For example, even with the major increase in child care assistance enacted as
part of the welfare reform legislation, her chances of getting a child care subsidy would be
very uncertain, depending on the state in which she lives or her place on a waiting list. If she
couldn't get help with child care, or had to pay a substantial co-payment, she would be
juggling rent, food, utilities, transportation, and child care costs out of her income just above
the official poverty line -- and probably skimping on food, doctor visits, or utility bills in
order to pay the rent.
To make a difference for these working families who fall through the cracks in today's programs and
supports, we need to understand why these gaps exist.
Far too often, working families do not receive program benefits or supports that could make a
difference to their lives and their children's lives -- and perhaps even make the difference in their
ability to hold onto a job rather than give up and seek welfare or other assistance -- even though they
are eligible. Sometimes, the benefits are only available at a location (such as the welfare office) or
time that is inconvenient for parents who work; sometimes, no one has told them about their
eligibility; sometimes, they are discouraged by long waiting lists; and sometimes, detailed policy
or verification rules create unintended barriers. HHS estimates that more than four million children
are eligible for Medicaid but not enrolled. The Administration has worked with States to begin to
attack this problem through efforts such as outreach to families eligible for Medicaid and CHIP, the
promotion of child care consumer education, and technical assistance to States provided through the
Child Care Bureau and the Office of Family Assistance.
Sometimes, critical programs or supports are targeted in ways that do not reach all the working
families who need them. For instance, the EITC, while a critical source of support for many low-
income working families, does not provide enough support to lift families from poverty if they work
only part-time or face extended periods of unemployment. Large families are also likely to remain
poor in spite of the EITC, because payments do not increase for families with more than two
children. Similarly, unemployment insurance is often not available to low-wage workers who
experience unemployment after a period of part-time or seasonal work.
In other cases, critical programs or supports, like child care and housing assistance, have eligibility
criteria that include working families but are underfunded and don't reach all eligible families. In
the case of child care, we estimate that only a little more than 1 in 10 of the families eligible under
Federal law actually receive assistance.
2
Therefore, to close these gaps, build on the Administration's accomplishments to date, and take the
next steps toward a legacy where every parent who works is able to meet his or her children's needs,
we propose a range of strategies that fit under five key themes:
Removing bureaucratic barriers to work and maximizing the effectiveness of existing
programs
Building secure, reliable supports for work, such as Food Stamps, child care, health care,
housing;
Helping families earn a living wage, through improvements in the minimum wage, education
and skill development among low-wage workers, and job creation;
Helping families weather temporary breaks in employment without being forced to rely on
welfare, through improved access to unemployment insurance for low-wage workers and
possibly through improved availability of parental leave for low-income families; and
Meeting the particular needs of families who are especially likely to work and still be poor,
such as families with a disabled member and immigrant families. According to the Urban
Institute, families with a foreign-born parent represent 16 percent of all working families, but 25
percent of working families with incomes below 150 percent of the poverty line.
Families Who Work and Are Poor
In 1996, more than one-third of the poor, or about 13 million people, were working adults or children
under 13 living with a working adult. In these families, an adult spent more than half the year in the
labor force but family income was below the poverty level (approximately $12,600 for a family of
three).
Working poor families live close to the edge of disaster. Even minor problems -- illness, school
vacations that leave children without care, a broken-down car -- too often result in job loss and
financial crisis. Every day, working poor parents may face wrenching questions: Do I send my sick
child to school, or risk losing my job? Is it worth taking six buses every day in order to bring my
child to that day care center? Do I tell my boss that I can't work evenings, because I'd have to leave
my teenager at home alone? If I pay the rent instead of the electric bill, will they turn off the heat?
Living this close to the edge, low-income working families also suffer consequences that are not
directly reflected in the poverty statistics, such as hunger and housing instability. In 1995, according
to the USDA, 4 million American households, many of whom included an employed family
member, experienced moderate or severe hunger. The National Center on Homeless and Poverty
reports that 25 to 40 percent of the homeless population work. And almost half of working poor
adults lack health insurance.
Working families may be poor for three major reasons (See Attachment B):
3
1.
Because they earn low wages, which are often closely related to low levels of
education. People who go to college, on average, earn more than those who do not. In 1996, the
poverty rate was 16.2 percent for working adults (in the labor force at least half the year) with
less than a high school diploma, 6.3 percent for working adults with just a high school diploma,
3.2 percent for working adults with an Associate degree, and 1.5 percent for those with a four-
year degree. Unemployment is also much higher for those with less education. In recent
decades, wages have fallen for workers with high school degrees or less, but have risen for those
with more education.
2.
Because they experience frequent periods of unemployment and part-time work.
With the help of the EITC, workers who are employed full-time year-round, even at the
minimum wage, can escape poverty. However, many low-wage jobs are part-time, temporary,
or contingent. In 1996, workers who usually worked part-time were three times as likely to be
poor as workers who usually worked full-time.
3.
Because they have only one wage earner in the household. In 1996, the poverty rate
for families with one member in the labor force was more than seven times that of families with
two or more members.
Because families headed by a single mother are often affected by more than one of these factors, they
are disproportionately likely to be among the working poor. Nearly half of working poor families
were headed by a woman in 1996. In addition, immigrant families, families with a disabled member
and those facing other barriers to work are particularly likely to be poor.
A final reason why families who work at low wages and intermittent hours may have great difficulty
meeting their children's basic needs is the high cost of work. One recent study found that formal
child care for a single child would take 38% of the income of a parent employed full-time at the
minimum wage. Transportation is also a major expense. A 1992 study found that average
transportation costs for low-income working mothers ranged from $100 to $200 a month, depending
on the availability of public transportation. At the same time, even relatively low levels of earnings
may result in reductions in other family income, including welfare, food stamps, medical assistance,
and housing subsidies.
What the Administration Has Already Accomplished
The Administration has taken important steps to help working families -- through increases in the
minimum wage, expansions in the Earned Income Tax Credit (EITC) and in child care funding, and
the dramatic expansion in children's health insurance coverage through the Children's Health
Insurance Program (CHIP). These steps have had an important impact on at least some of these key
goals (See Attachment C):
The 1996 and 1997 minimum wage increases raised the wages of workers in 1.4 million poor
families and 649,000 near-poor families.
The EITC, which provides targeted tax relief to low-income working individuals and families,
was greatly expanded during the Clinton Administration. In 1993, the EITC just offset the
negative impact of federal income and payroll taxes on poverty; by 1996, it offset the impact of
taxes for 1.2 million children and lifted an additional 1.2 million children out of poverty.
4
Congress has enacted several Clinton Administration proposals to make college more affordable
to low-income and middle-class students. The new "HOPE Scholarship" tax credit provides up
to a $1,500 tax credit for students in the first two years of college or vocational school. The
Lifetime Learning tax credit is targeted to adults who want to go back to school, change careers,
or upgrade their skills, and to students in the later years of college and graduate education. The
maximum Pell Grant was also just increased to $4,500, a 50 percent increase.
The new Children's Health Insurance Program (CHIP) allocates $24 billion over the next five
years to help states expand health insurance coverage to the children of working poor families.
Forty-five plans have been approved; these plans estimate that they will provide health insurance
for nearly 2.5 million currently uninsured children within the next three years.
The additional child care funds that the President insisted on in the welfare reform legislation
have enabled hundreds of thousands of families to receive affordable child care while they work.
Child support collections have increased by 68 percent since 1992, to a record $13.4 billion in
1997. Paternity establishments are also at record levels.
The new housing law will create 50,000 new Section 8 housing vouchers this year for families
moving from welfare to work, and will make an additional 40,000 vouchers available by
eliminating a mandatory three-month waiting period to reissue vouchers. The law will also allow
communities to reward work and fight concentrations of extreme poverty by allowing moderate-
income working families to live in public housing where the poorest residents on welfare are
now concentrated, while reserving most Section 8 vouchers for the neediest families.
The Family and Medical Leave Act has enabled millions of workers to take unpaid leave to care
for a young child or other family member, without risking their jobs.
The Clinton Administration, through welfare reform legislation and earlier waivers, has
supported changes that allow families who work at a low wage and receive welfare to keep more
of the money they earn.
The Access to Jobs program represents an investment in transportation for families leaving
welfare to work; for the first time, the Department of Health and Human Services, the
Department of Transportation, and the Department of Labor are working together to leverage
resources from all three agencies to improve transportation availability and affordability for low-
income workers.
Yet, extraordinary as these accomplishments are, they leave millions of working parents still unable
to meet the needs of their children. For example:
While the increase in the minimum wage has been enormously important to families, it has not
yet returned to its 1979 value when adjusted for inflation. The real value of the minimum wage
(in 1997 dollars) fell from $6.29 in 1979 to about $4.30 in 1989 before being increased to $5.15
in 1997.
While CHIP should have a very important impact on the proportion of children who lack health
insurance, there continue to be reasons for concern about working poor families. Almost half
of working poor adults lack health insurance, and even where children and adults are guaranteed
coverage (for example, through transitional Medicaid provisions), some families may be lost in
the system. In 1995, just 38 percent of children under age 11 who were eligible for Medicaid but
did not receive cash assistance were enrolled in the Medicaid program. More recent evidence
points to a much higher incidence of families who are eligible for but not receiving Medicaid.
5
The continuation of health insurance is an especially critical concern for families with disabled
members, because they visit the doctor and are hospitalized more often than the non-disabled
population; as noted above, these families are also especially likely to be found among the
working poor. (See Attachment D.)
Even with the additional child care resources in the welfare reform legislation, only about 1 in
10 children eligible under the Federal law are now receiving child care subsidies. Because of
resource limitations, some states set eligibility far below what is allowed in the law: in as many
as 37 states, a family of three with $28,000 of income is not eligible for any child care subsidy
at all. In addition, most states aren't able to reach even all the families that meet their eligibility
requirements. Availability of infant care and care during non-standard hours also remains a
serious problem. For these reasons, the President has proposed a historic Child Care Initiative
to ensure quality, affordable child care for working families.
What We Propose
To build on this record of promise and ensure that families who work are able to meet their
children's basic needs, we must put together a range of strategies, because there is no one solution
that will help every family make a secure living from work. Instead, we need to look at everything
we do that touches working families to make sure that we are supporting rather than discouraging
work. Departments throughout the government have numerous opportunities to make a difference
in the lives of low-income working families by maximizing the effectiveness of their existing
programs and finding new ways of serving working families.
Based on the evidence about why working families are poor and what strategies show the most
promise of supporting families effectively, we propose that the Administration should commit to five
steps that together will make sure that parents who work can meet their children's basic needs:
1. Remove Bureaucratic Barriers to Work and Maximize the Effectiveness of Existing
Programs
Low-income working parents face an incredible challenge to hold down a job, raise their
children, and manage relations with multiple bureaucracies to obtain all the supports that the
family needs. Families' attempts to support themselves through work should not be hampered by
bureaucratic processes nor through the unintended consequences of well-meaning policies. We
must mount a major campaign to ensure that families gain access to these supports by using
Federal leadership not only to streamline national rules, but to change service delivery at the
State and local levels.
Examine programs for low-income families throughout the government to find ways to
change program hours and operations, strengthen outreach efforts, eliminate barriers of
language and culture, and modify eligibility rules to make them fit the needs of working
families.
HHS and other Departments can take on critical leadership in finding and eliminating barriers to
work scattered throughout government programs serving low-income people. Efforts to root out
6
bureaucratic barriers have proved fruitful recently. The Federal and state governments eliminated
the old AFDC rules which curbed families' incentives to work while they were receiving cash
assistance. In addition, HHS eliminated Medicaid's "100 hour rule," which limited states'
ability to serve two-parent families. We should also explore innovations in programs' designs to
reach working families. For instance, the EITC is an example of a program that is easily
accessible to busy working families; instead of having to visit a welfare office, or fill out a
separate application form, workers get the EITC simply by filling out their tax return.
More powerful examples are included in proposals that the Food and Nutrition Service is
considering for the FY 2000 budget. Some proposals would affect eligibility criteria, such as
proposals in past budgets to ease the consideration of vehicles as resources to help assure that
low-income workers have access to reliable transportation, or to restore eligibility for more legal
immigrants who work hard and contribute to American society. Other proposals would affect
food stamp administrative requirements in ways that simplify working households' participation
in the Food Stamp Program and improve their access to the program. Similarly, States are
experimenting with ways to make the WIC program more accessible to working parents through
adjustment of service hours to accommodate job schedules.
Actively engage state leadership in outreach to working families through incentives, targets,
mandates, and technical assistance.
Policymakers and administrators at the state and local level are necessary allies in ensuring that
programs meet the needs of working families through the flexibility that is provided to them in
Federal law.. Many state and local officials are already implementing these strategies. For
instance, in the transportation field, some states and communities have removed eligibility
restrictions to allow narrowly targeted transportation systems (e.g., for senior citizens and people
with disabilities) to help low-income workers to get to their jobs. We should explore ways to
build on these efforts by offering technical assistance that helps state and local governments use
the flexibility they have to serve working families and by finding ways to create incentives and
rewards for states that choose to serve more working families.
State and local outreach is critical in programs like the Food Stamp program; estimates show that
less than half of those individuals in households with earnings who were eligible for food stamps
actually received them in August of 1995. Some of these individuals may not realize that they
are eligible for benefits, while others may not be connected to the right systems to receive
benefits or find the receipt of Food Stamps too stigmatizing to apply. State and local
administrators are positioned to make adjustments in how they implement the program to meet
the needs of working families.
Encourage states to provide earnings disregards or other supplements to working families
receiving TANF assistance.
Almost all states have increased earnings disregards in TANF compared to AFDC, which means
that working families who are in low-wage jobs can get a direct monthly supplement to earnings
through their welfare check. However, because of time limits, this risks having the effect of
using up a family's eligibility. Illinois has dealt with this problem by paying individuals who
7
work more than a minimum threshold in a month with state dollars so that they don't accumulate
that month toward the time limit. We could encourage states to consider using MOE dollars to
?
enhance earnings without triggering the TANF rules. A more systematic approach would be to
propose legislation that would allow a family to receive assistance funded by TANF without
triggering the federal 60-month time limit if they were only receiving work supports or if they
NO, the
were receiving limited assistance to supplement a paycheck.
no evid
that people
2. Build Secure, Reliable Supports for Work
will or sho
stay roll
Parents who work in low-wage jobs with uncertain hours need to be able to count on reliable and
for year
affordable supports in order to keep their jobs and meet family needs. Child care, health
to get this
insurance, food assistance, housing and transportation all have important potential to help
help. Time
families. Regular, reliable child support payments are also key for low-income families.
limits are
a problem 1
Ensure that Food Stamps and other food programs provide sufficient support for children and people wh
adults in low-income working families.
aren't work
Food stamps provide a critical support for low-income working families. For a family with two
children and one adult working at the minimum wage, food stamps would provide about one
third of family income (considerably more than the EITC) if the parent worked 20 hours a week.
Food stamps would provide just under one fifth of family income (slightly less than the EITC) if
the parent worked 40 hours a week.
The Department of Agriculture is exploring ways to strengthen the supports that food stamps and
other Food and Nutrition Service (FNS) programs offer to working families. For example, the
Department of Agriculture is considering review of the Thrifty Food Plan (the basis of food
stamp benefits) to understand if it appropriately reflects the reduced food preparation time that
working households have available.
The Department of Agriculture is also looking to its Child Nutrition programs to support
working families. The pending reauthorization bills for the Child Nutrition programs propose to
Didn't
expand eligibility for subsidized after-school snacks for children up to age 18 and to do
these
demonstrations to expand eligibility for school breakfasts, which not only subsidize the cost of
pass?
the family's food, but also assure working parents that children are receiving a nutritious
breakfast before school.
Continue to improve the availability of health insurance through Medicaid/ CHIP.
Much of the work that needs to be done here is about outreach and removal of bureaucratic
barriers such as burdensome processes and excessive eligibility documentation.
In addition, for low-income working parents, we should consider strategies which modestly
expand Medicaid eligibility, such as simplification of transitional benefits for persons moving
from welfare to work, or extension of Medicaid to all adults receiving benefits under TANF.
Many of these would require legislation or Medicaid spending increases.
8
Pass the President's Child Care Initiative.
Because child care is so critical to the ability of parents to work and the ability of children to
develop and learn, and because the cost and availability of child care are central to the ability of
low-income working parents to succeed at work, it is essential to pass the President's Child Care
Initiative. This initiative focuses on both quality and affordability; in particular, it closes a
critical gap by expanding child care subsidies to reach low-income working families who are
currently not being reached but who earn too little to take advantage of the Child and Dependent
Care Tax Credit.
Encourage workplaces to provide employee and family assistance programs to assist low-wage
earners in meeting personal and family demands, including substance abuse early
intervention and treatment.
We can work to promote the use of employee and family assistance programs (EFAP) and
ensure that their design and operation include special assistance to those entering the workplace
from welfare. These EFAPs, working jointly with human resources departments and health care
plans, should provide prevention, early intervention and treatment for substance abuse and
mental health problems, parenting programs for employees and assistance for employees in
finding appropriate child and elder care. In addition, we can perform outreach to small
businesses to help them identify and access sources of support for their employees, since they are
unlikely to have the internal capacity of large corporations with human resource departments and
EFAPs.
Ensure that the subsidized housing system is designed to help families connect to employment
and employment support services.
Housing assistance has an important role to play in helping families obtain and maintain
employment and affects families' ability to work in multiple ways. The recently passed housing
bill is an important step in increasing the availability of affordable housing. The Department of
Housing and Urban Development could explore their legislation and regulations to avoid and
eliminate situations in which a family's earned income gains are subsumed by a reduction in
their housing subsidy. Early discussions between HHS and HUD indicate that there is great
potential in collaborations that help convene local housing, welfare, and job development
agencies, which separately serve the same families, to begin a dialogue about how they can work
together to support working families. Other collaborative projects might include exploring ways
to promote affordable housing options closer to available jobs, to explore transportation solutions
to connect public housing to high-density employment areas, to examine how the system serves
immigrant families which are, on average, larger families, and to promote the location of
supportive services (e.g. child care) in and around subsidized housing.
Revamp the transportation system to fit new commuting patterns and better serve low-income
workers.
The next step beyond the Access to Jobs program is to focus at the federal, state, and local levels
on using the entire transportation system to meet the needs of low-income workers. There may
9
be some interest in additional budget investments in order to leverage changes in the existing
transportation infrastructure.
Continue to strengthen Child Support Enforcement, with a focus on working families.
Regular, reliable, sufficient child support payments are a critical support for low-income working
families with single parents, because they make it possible to count on a stream of income to
supplement earnings and pay the bills even with uncertain work hours. In addition, of course,
children deserve and have a right to the financial and emotional support of both parents. Under
the Clinton Administration's leadership, child support collections and paternity establishment
rates have reached record levels. The Administration and Congress worked together to pass the
toughest child support laws in our Nation's history, as part of the 1996 welfare reform law, and
we must build on these efforts. It is also important to learn from and expand upon the HHS
demonstrations that promote employment and parental involvement opportunities for low-
income non-custodial parents.
3. Help Families Earn a Living Wage
Preserve the value of the minimum wage.
We should increase the minimum wage to improve the earnings both of parents at the very bottom
of the labor market and those who are in jobs just above those entry levels, whose wages often rise
with the minimum wage as employers seek to preserve a spread in the wages of their more skilled
or experienced workers. We also need to continue increasing the minimum wage over time, in order
to keep up with the rising costs imposed by inflation.
Expand the EITC, support state EITC's, or identify other opportunities to support family income
through the tax system.
The Administration could consider the possibility of further expansion of the EITC at the Federal
level, but it is also critical to avoid any risk to the progress already made. Another possibility is to
seek opportunities for encouraging more states to provide additional support through state EITC's.
Nine states currently provide a supplement modeled on the Federal EITC (five refundable, four non-
refundable).
Stimulate job creation in areas that still suffer from high unemployment.
While nationwide unemployment is at historically low levels, many pockets of high unemployment
remain, particularly in remote rural areas and in inner cities. In these areas, job creation strategies
may be appropriate, especially when aimed at populations who are particularly disadvantaged in the
labor market, such as young workers, immigrant workers, workers without high school diplomas,
or women who are returning to the workforce after years on welfare. The $3 billion Welfare to
Work grants program, proposed and championed by the Administration, is an important step at
delivering extra assistance toward areas with many challenges in moving people into jobs.
10
Experience suggests that community-based projects are more likely to be tailored to local needs and
to respond to local labor market conditions than large national programs. We should continue to
utilize a network of community-based organizations, specifically community development
corporations, that create public-private ventures to stimulate employment at the local level.
Empowerment Zones and Enterprise Communities provide a powerful example of leveraging
resources for job creation and a vehicle for testing models tailored to local needs.
There are several local programs that may provide appropriate models for local job creation
strategies. The New Hope project in Milwaukee, Wisconsin, places individuals in paid community
service jobs with non-profit agencies for up to six months, if they are unable to find full-time work
in an eight-week job search. YouthBuild gives disadvantaged teenagers and young adults an
opportunity to do meaningful work in their communities while continuing to develop academic and
leadership skills. Participants spend half their time learning basic construction skills while building
and renovating affordable housing, and half of the time in YouthBuild alternative schools. The
AFDC Homemaker-Home Health Aide demonstrations, operated in seven states in the 1980's,
provided AFDC recipients with four to eight weeks of formal training in homemaker and home
health aide services, followed by up to a year of full-time, subsidized employment.
Make college more accessible for low-income families
Nearly half of low-income students are unqualified or marginally qualified for college when they
graduate high school. Moreover, among those low-income high school graduates who were qualified
for college, less than 80 percent had attended any post-secondary institution within two years --
compared to almost 90 percent of qualified middle-income graduates and more than 95 percent of
qualified high-income graduates. Implementation of the new GEAR UP program represents an
essential first step by ensuring that students receive financial aid information, rigorous courses,
tutoring, mentoring, and scholarships for college through competitive grants to states and local
partnerships of colleges and middle schools in high-poverty areas. In addition, we can take steps
to take into account the needs of dependent children in determining financial aid eligibility. For
instance, we can increase the Pell Grants' dependent care allowance.
Enhance skills and support career development among low-income workers.
Low wages that don't rise even after a period of time in the labor force are a big reason that families
are trapped in poverty. Lack of education and job skills are the primary reasons for persistently low
wages. Our success in this area will be increasingly depend on our ability to reach workers whose
first language is not English. By 2000, 22 percent of workers entering the labor force will be
workers whose primary language is not English.
Among the ways to combat this problem is to work with colleges to make continuing education more
accessible to working adults, particularly low-income adults and those who have previously failed
in school settings. Adults without high school degrees and those who are unemployed or not in the
labor force are actually less likely to participate in adult education than those who have more
education and those who are employed. In addition, more needs to be done to ensure that students
who combine school and work complete their studies. Of part-time students enrolled in post-
11
secondary education in 1989-90, just 25 percent had earned a degree or were still enrolled four years
later, compared to 73 percent of students who attended school full-time at least part of the year.
States and communities across the country are experimenting with a wide variety of strategies and
partnerships to enhance the learning and skill development of entry-level workers and to help them
use those skills in a next job. While many of these efforts are still in the preliminary stages, some
general principles can be drawn from them: in a strong economy, low-wage earners should seize the
opportunity to look for a job with advancement potential. Education and training must be work-
focused, and linked to employers' needs with cooperation between employers and training providers.
Training must be accessible for all workers, including those with learning disabilities or limited
English proficiency.
We should consider a variety of investments in these areas, and we expect that both the Department
of Labor and the Department of Education are interested in making investments. In addition to
supporting programs directly, it is important to use incentive strategies -- such as the High
Performance Bonus and Welfare-to-Work grants performance bonus -- and to invest in technical
assistance and evaluation, in order to stimulate, identify, and disseminate new approaches that are
successful.
4. Help Families Weather Temporary Breaks in Employment
Improve access to Unemployment Insurance (UI) for low-income working families.
Right now, low-income workers who lose jobs through no fault of their own have less chance than
middle income workers to get unemployment insurance to help them through periods of
unemployment. We need to change that if we are to help working parents count on work, meet their
children's needs, and avoid having to rely on welfare in a time of temporary job loss.
Under current rules, most low-wage workers who become unemployed will not qualify for UI
benefits. Low wage earners often work seasonal or part-time jobs and most will not accumulate
enough earnings to meet eligibility criteria. In addition, workers who leave their jobs for family
responsibilities or who are available only for part-time work will not qualify in many states. This
affects low-wage mothers in particular. Recent estimates indicate that among women who leave
welfare to work, only about 10 percent would qualify for UI if they became unemployed. The
proportion of unemployed workers receiving UI benefits is low among the general population as
well, falling from about one-half in 1970 to about one-third in 1996. A significant reason for this
decline is state eligibility restrictions, with over three-quarters of states adopting tighter eligibility
criteria since 1981.
There are at least two possible strategies that could make more low wage workers qualify for UI.
We could expand UI by making changes at the Federal level, or we could encourage state
investments to expand UI eligibility, either through the regular UI system or through investment of
other resources (such as TANF MOE funds). At the Federal level, the Department of Labor is
currently gathering a variety of opinions on what eligibility changes the Administration should
propose for the FY 2000 legislative package. For example, one proposal would change the
12
calculation of prior earnings in determining whether a worker is qualified, counting the most recent
quarter of earnings whereas currently the calculation is usually based on an earlier period. This
change would increase the number of workers qualified for unemployment insurance benefits by
about 8 percent.
Improve the availability of parental leave for low-income working families.
To help low-income working parents keep the stability of their work lives through the birth and
infancy of a child, we could build on the important step that the Administration took by enacting the
Family and Medical Leave Act (FMLA). Unfortunately, for low-income parents, there are two
important gaps in this protection:
First, while FMLA guaranteed to many workers that they could take unpaid leave without losing
their jobs, many others are not covered, either because they work for a small employer, or because
they did not work enough hours in order to qualify. In addition, unpaid leave may not be a real
option for these families, forcing parents either to choose work over the needs of an infant or to
suffer a sharp decrease in family income. In a recent survey on leave usage, 3.4 percent of workers
reported needing FMLA leave in the previous eighteen months, but not taking it. The most common
reason (63.9 percent) for not taking leave was that they couldn't afford it.
To address these problems, we could consider expansion of unpaid leave or the introduction of paid
leave strategies for either the Federal or the state level. We know that at least two states have chosen
to use Federal or state child care money to support low-income families at home with children, and
we could explore whether others are interested in experimenting with approaches to paid leave for
low-income families. A few states have also raised the possibility of using the UI system to provide
paid parental leave.
5. Meet the needs of families with particular barriers to work, such as families with a disabled
member or immigrant families.
There is an important overlap between the immigrant and disability agendas on which HHS has been
providing such leadership and the working families agenda, because these are families who are
especially likely to work and still be poor. Families may need supports that address their particular
needs - such as a job coach so a disabled adult can succeed on the job or English classes at night for
a working parent. They also need full access to the basic supports described earlier: for example,
child care to meet the needs of children with disabilities and skill development opportunities need
to be accessible to parents with limited English.
In families with a child or children with a disability, there are enormous needs related to child care,
personal care assistance, and health care and other home care needs that must be addressed to enable
the parent(s) to continue, or begin, employment. For adults who have a disability, whether mental
illness, mental retardation/developmenta disability, or a physical disability, there may be a need for
additional assistance to allow the family to remain together and promote the fullest independence
of all the family members in the most integrated setting possible. Support for workers with
disabilities is also an important part of the welfare-to-work agenda, as survey data indicate that as
many as 40 percent of welfare recipients have a disability of some type.
13
Ensure that immigrant working families have access to the English and citizenship instruction
and that legal, language, and cultural barriers do not keep them from receiving the work supports
and training that they need to succeed at work.
The President has welcomed all immigrant families, with a charge to "honor laws, embrace our
culture, learn our language, know our history, and when the time comes, [to] become citizens."
Working poor immigrant families will face a tougher challenge in fulfilling the President's charge
due to the demands of simply feeding and housing their children. In order to end poverty among
immigrant working families and speed their process in becoming Americans, there are a number of
specific strategies to implement. First, working immigrant parents must have access to English
classes and employers should be encouraged to offer worksite English classes before, during, or after
work. Second, we should ensure that barriers of language and culture do not preclude working
immigrants from getting the training that they need to succeed at work and move up career ladders.
Families should also have access to bilingual and bicultural child care for their children while parents
are working. Third, we should partner with employers to ensure that working families have
assistance in preparing for citizenship.
Finally, we should consider whether there are further next steps in increasing access of working
immigrant families to Medicaid, CHIP, TANF and Food Stamps, regardless of when they entered
the U.S.. For instance, the Health Care Finance Administration (HCFA) is developing specific
outreach strategies for Latino/Hispanic groups across the country. These safety net programs can
assist immigrant working families in reaching and sustaining economic self-sufficiency.
Ensure that both public and private health coverage systems are designed to meet the needs of
workers with disabilities.
The Administration has been active in developing options for states to offer for people with
disabilities opportunities to retain access to their health coverage when they go or return to work.
Last year's Balanced Budget Act contained a new option for states to continue Medicaid coverage
for SSI-eligible individuals with incomes up to 250 percent of poverty. Currently, HHS is
considering proposing legislation that would extend and improve on this recently adopted option,
extending Medicaid to disabled people with higher incomes and assets and also permitting certain
disabled Medicare beneficiaries to remain permanently on the program even if they return to work.
The Health Care Financing Administration is responsible for administering the Mental Health Parity
Act of 1996, which is designed to make sure that private sector health coverage does not have
different, lower limits for mental health services compared to general medical/surgical services. The
Substance Abuse and Mental Health Services Administration (SAMHSA) is currently involved in
gathering information through various studies on the costs and benefits of parity, which will help
employers and consumers make informed decisions about purchasing health plans where mental
health benefits are included. In plans where mental health benefits do not have parity with
medical/surgical benefits, this information could be used to improve mental health benefit coverage,
which is crucial to helping people who struggle with mental disorders to stay employed.
14
Integrate employment and supportive services for workers with disabilities into a one-stop system.
HHS is participating in an inter-agency effort to eliminate barriers and support employment for
people with disabilities. This effort, led by the Department of Labor, is developing a program of
competitive grants to states entitled the BRIDGE (Building Resources for Individuals with
Disabilities to Gain Employment) program. The BRIDGE program will emphasize a single point-of-
entry or "one-stop" service for adults with disabilities seeking to find and keep a job. Each adult
with a disability should be able to learn about, receive advice about, and gain access to all of the
services needed to succeed in competitive employment with the least effort possible, preferably with
a single call or office visit. Each of the services should be sufficiently integrated with all of the other
services so that they accomplish the goal of supporting long-term employment. The BRIDGE
program exemplifies new workforce system infrastructure approaches at the state and local level that
promote universal access through One-Stop Centers, integrated service delivery, enhanced customer
information, and choice to improve employment potential and opportunity.
Attached are additional charts and examples.
15
Attachment A-1
DISPOSABLE INCOME FOR A SINGLE MOTHER AND TWO CHILDREN
By Hours Worked each Week
(in current dollars)
1992 Prior to Clinton Administration Policies
20 hours
40 hours
40 hours
at $4.25
at $4.25
at $5.10
Annual Earnings
$4,420
$8,840
$10,608
FICA
-338
-676
-812
EITC
813
1,384
1,384
Food Stamps
3,504
3,048
2,724
Net Income
$8,399
$12,596
$13,904
1997 After Clinton Administration Policies
20 hours
40 hours
40 hours
at $5.15
at $5.15
at $6.18
Earnings
$5,356
$10,712
$12,854
FICA
-410
-819
-983
EITC
2,142
3,656
3,461
Food Stamps
3,780
3,228
2,844
Net Income
$10,869
$16,777
$18,176
Change (Clinton - Pre-Clinton)
Earnings
$936
$1,872
$2,246
FICA
-72
-143
-172
EITC
1,329
2,272
2,077
Food Stamps
276
180
120
Change In Net Income
in current dollars
$2,469
$4,181
$4,272
in constant 1997 dollars
$1,260
$2,367
$2,270
This analysis reflects the following:
The minimum wage increased to $5.15 from $4.25 ($4.86 in 1997 dollars).
The maximum EITC subsidy increased from 18.4% of the first $7,520 to 40% of the first $9,140.
Child Care expenses are assumed to be 20% of earnings.
Food Stamp benefit calculations assume an excess shelter cost deduction of 100% of the allowable maximum.
Attachment A-2
DISPOSABLE INCOME FOR A SINGLE MOTHER AND TWO CHILDREN
Living in a Moderate Benefit State By Hours Worked each Week
(In current dollars)
1992 Prior to Clinton Administration Policies & Welfare Reform
20 hours
40 hours
40 hours
at $4.25
at $4.25
at $5.10
Annual Earnings
$4,420
$8,840
$10,608
FICA
-338
-676
-812
EITC
813
1,384
1,384
Cash Assistance
2.592
0
o
Food Stamps
3,060
3,048
2,724
Net Income
$10,547
$12,596
$13,904
1997 After Clinton Administration Policies & Welfare Reform Were Enacted
20 hours
40 hours
40 hours
at $5.15
at $5.15
at $6.18
Earnings
$5,356
$10,712
$12,854
FICA
-410
-819
-983
EITC
2,142
3,656
3,461
Cash Assistance
3,444
1,836
1,188
Food Stamps
3,156
2,676
2,484
Net Income
$13,689
$18,061
$19,004
Change (Clinton Pre-Clinton)
Earnings
$936
$1,872
$2,246
FICA
-72
-143
-172
EITC
1,329
2,272
2,077
Cash Assistance
852
1,836
1,188
Food Stamps
96
-372
-240
Change In Net Income
in current dollars
$3,141
$5,465
$5,100
in constant 1997 dollars
$1,623
$3,651
$3,098
This analysis reflects the following:
The minimum wage increased to $5.15 from $4.25 ($4.86 in 1997 dollars).
The maximum EITC subsidy increased from 18.4% of the first $7,520 to 40% of the first $9,140.
Child Care expenses are assumed to be 20% of earnings.
Food Stamp benefit calculations assume an excess shelter cost deduction of 100% of the allowable maximum.
Attachment B
Causes of Poverty among Working Families
Several factors contribute to the extent of poverty among working families:
Low wages: The working poor are concentrated in certain low-wage jobs. In 1996,
nearly three-fourths of the working poor were employed in one of the following three
occupational groups: service; technical, sales, and administrative support; and operators,
fabricators and laborers. Low wages are often closely related to low levels of education.
Workers without a high school diploma were more than twice as likely to be poor as
workers who had completed high school, and 10 times more likely to be poor than
workers who had graduated college.
Unemployment and part-time work: With the help of the EITC, workers who are
employed full-time year-round, even at the minimum wage, can escape poverty.
However, many low-wage jobs are part-time, temporary, or contingent. In 1996, workers
who usually worked part-time were three times as likely to be poor as workers who
usually worked full-time (12.4 percent versus 4.1 percent), and those who worked part-
time because they could not find full-time employment were even more likely to be poor
(24.9 percent). Many poor workers who usually worked full-time experienced
unemployment (28.4 percent) or involuntary part-time work (15.8 percent) at some point
during the year. In addition, a recent report based on monthly data suggests that a
significant number of non-poor families (based on annual income) may be poor for one
or more months due to fluctuations in income.
Family structure: Families with only one wage-earner are much more likely to be poor
than families with two or more working members. In 1996, the poverty rate for families
with one member in the labor force was more than seven times that of families with two
or more members in the labor force (14.6 versus 1.9 percent). Also, because the poverty
threshold increases with family size, given the same income, families with more children
are poor more often than families with less.
Because families headed by a single mother are often affected by more than one of these factors,
they are disproportionately likely to be among the working poor. Nearly half of working poor
families were headed by a woman in 1996. The poverty rate for families with children that were
maintained by a woman who was the sole supporter of the family was 26.6 percent.
Source: BLS: A Profile of the Working Poor, 1996. December 1997
Attachment C
Impact of Transfers and Taxes on Poverty
The official poverty rate calculations include cash benefits, such as AFDC/TANF and Social
Security, but do not include near-cash benefits, such as Food Stamps and housing assistance.
They also do not include payroll and income taxes, which reduce families' take-home pay, or the
Earned Income Tax Credit, a refundable credit which adds to family income. However, by
recalculating the poverty rate, first excluding all transfers, and then adding both cash and near-
cash benefits, as well as taxes, we can estimate the impact of these programs on poverty.
In 1995, the pre-transfer poverty rate for individuals in families with children under 18 was 20
percent. Transfers from the federal government reduced that rate to 13 percent, a decline of more
than 35 percent.
The fraction of individuals in poor families lifted from poverty has grown consistently since
1983. Most of this growth has come from increases in the Earned Income Tax Credit (EITC).
Before 1993, the net impact of federal taxes was to take money away from poor families,
primarily through Social Security payroll taxes. (The EITC is only available to families and
individuals with earned income.)
Unemployment Insurance has a relatively small impact on the poverty rate because most poor
workers do not have enough earnings or consistent labor market participation to qualify for UI
benefits.
Anti-Poverty Effectiveness of Cash and Near-Cash Transfers
for All Persons in Families with Related Children Under 18, 1995
Percent of Otherwise Poor Persons
Removed from Poverty Due to:
Social Insurance (other than Social Security)
3.5
Social Security
6.1
Means-Tested Cash Benefits
6.6
Food and Housing Benefits
12.5
EITC and Federal Payroll and Income Taxes
6.6
Total
35.2
Source: DHHS, Indicators of Welfare Dependence, October 1997
Attachment D
Health Care Coverage of Poor and Near-Poor Adults and Children
Health care coverage is a fundamental aspect of well-being. Individuals without health insurance
are less likely to seek preventive care and early treatment, and could be more likely to develop
serious illnesses as a result.
In 1997, 43.4 million people, or 16.1 percent of the population, did not have any health insurance
coverage, an increase of 1.7 million from 1996 in spite of the robust economy. Among poor
people, 11.2 million (31.6 percent) were not covered. Almost half of working poor adults lack
health insurance. Because many low-wage jobs do not provide health insurance, working poor
and near-poor adults are actually less likely to have health insurance coverage than their non-
working counterparts, who are more likely to be covered by Medicaid.
Percent Lacking Health Insurance Coverage
Total
Poor
Total
16.1
31.6
Adults who worked during year
18.1
47.6
Working-age adults who did not work
26.2
38.5
Children
15.0
23.8
Source: U.S. Census Bureau, March supplement to the 1998 Current Population Survey (data from calendar year
1997)
By law, families leaving the TANF rolls maintain their eligibility for Medicaid for up to one
year. Nonetheless, there is evidence, from a 1997 GAO study of three states and from several
states' own studies of welfare "leavers", that among families whose welfare benefits are
terminated or who leave welfare for work, participation in Medicaid declines significantly and is
not offset by a corresponding increase in private insurance coverage.
The continuation of health insurance is an especially critical concern for individuals with
disabilities, as they visit the doctor and are hospitalized more often than the non-disabled
population, and have higher average medical expenses. One study showed that annual per capital
health care spending for adults with moderate disabilities was six times, and for adults with
significant disabilities was twelve times, that for non-disabled working age adults.
final
THE WHITE HOUSE
WASHINGTON
November 11, 1998
MEMORANDUM FOR THE PRESIDENT
FROM:
Bruce Reed
Gene Sperling
Elena Kagan
Sally Katzen
SUBJECT:
State of the Union/Budget Ideas
This memorandum provides a brief description of new ideas we are considering for the State of the
Union. Some work has been done on fleshing them out, but many need additional work and further
vetting through the interagency process. Most of these ideas involve increased spending, and you
will have to make choices among them and/or scale them back as you consider the FY 2000 budget.
Although our offices have worked together on many, if not most, of the ideas in this memo, we have
noted, where possible, which of our offices has the lead role with respect to each proposal. Options
relating to Social Security are not included in this memo.
EDUCATION AND TRAINING (DPC/NEC as specified)
1. Ending Social Promotion. Last year's budget proposal included $200 million for Education
Opportunity Zones in districts that agreed to remove bad teachers, turn around failing schools, and
end social promotions. The proposal required authorization, which Congress will never give us. For
next year, we recommend a simpler approach that uses existing authority and focuses entirely on
ending social promotion. We would like to expand our after-school program from $200 million to
$700 million and target this money to districts that end social promotion. These school districts
could use the money (as Chicago does) to provide extra help after school and mandatory summer
school for students who need it. (Cost: $300 million above FY99 budget.) (DPC)
2. Teacher Quality and Recruitment. Now that we're on track to begin hiring 100,000 new
teachers to reduce class size, we have an even greater responsibility to help communities attract
talented new teachers to the profession. We envision a five-part strategy on teacher quality and
recruitment: (1) a $100 million increase in the teacher recruitment scholarships we enacted this year
in the Higher Education Act, which would put us on course to attract 60,000 new teachers at high-
need schools over the next five years; (2) a $60 million initiative modeled after the successful
Troops-to-Teachers program - that would help states expand alternative certification routes and
attract talented people from other professions, such as military personnel and employees in firms
being downsized; (3) a nationwide crackdown on teacher education schools, including new
regulations authorized by the Higher Education Act to require report cards for education schools;
(4) a $50 million increase in the Eisenhower program to send secondary school teachers who teach
2
outside their field back to college to take additional courses in the subjects they're teaching, coupled
with a new requirement that new secondary teachers pass competency tests in a subject before they
can teach it; and (5) a high-profile effort to help states make the most of the 15 percent set-aside for
teacher quality in the recently passed class size legislation. (Cost: about $210 million above FY99
budget). We are also exploring a politically interesting counter to private school choice: vouchers
for private school teachers -- i.e., an incentive program to encourage private school teachers to teach
in public schools. (DPC)
3. Work-Site Schools. One of the most promising new education ideas sprouting up around the
country is the creation of public schools at work sites, designed primarily to serve employees'
children. School districts provide the teachers and curriculum; companies provide facilities and
upkeep. These schools-at-work serve a host of objectives at once, by (1) providing new facilities
at no cost to the district; (2) increasing parental involvement in the schools and parental satisfaction
in the workplace; (3) reducing employee turnover and absenteeism; and (4) increasing school
diversity, because work sites are more diverse than residential neighborhoods. We propose a $100
million increase in an existing discretionary program to provide grants to 100 communities to launch
work-site schools. We also could seek a stand-alone bill (like the charter school law) to advance this
idea. In addition, we are working with Treasury to develop a tax credit for businesses that start on-
site schools, similar to the Kohl business tax credit for on-site child care that is already in our budget.
(Cost: $100 million for start-up grants. No estimate yet for tax credit, but it will be very small.)
(DPC/NEC)
4. Public School Choice. As support grows for private school vouchers, we must continue our
efforts to expand choices within the public schools. Charter schools are one answer, and we
recommend a $20 million increase, to $120 million, to keep us on track to 3,000 charter schools by
2002. Work-site schools are another. We also recommend increased funding for (1) an existing
grant program that helps urban and suburban school districts reduce racial isolation by forming
interdistrict magnet programs; and (2) magnet schools on university campuses, especially in urban
areas. (Cost: $25 million for interdistrict magnet programs; $15 million for 10 university-based
schools.) (DPC)
5. School Leadership Academies. Research has shown that an effective principal is the single
most important indicator of school success, yet little has been done at the national or state level to
improve the management skills of principals. We propose a small initiative to create school
leadership academies that would provide training in management, teacher evaluation, school
discipline, and other areas to elementary school principals in high-poverty districts. (Cost: $50
million) (DPC)
6. Class size. To stay on course to reach 100,000 new teachers in seven years, we will ask for $1.3
billion in the FY2000 budget. We are planning an ambitious rollout of the class size initiative over
the next year, as we award first-year funding, issue guidance to local districts on how the program
works, and so on. We also will press Congress to restore the local matching requirement and
strengthen the provisions to require competency testing of new teachers. (DPC)
3
7. Adult Literacy. According to the National Adult Literacy Survey, 44 million adults struggle
with a job application, cannot read to their children, or are left on the welfare rolls because they lack
basic skills. We are considering: (1) Workplace: a new tax credit and/or Federal grants to encourage
employers to provide adult basic education classes at the worksite, and setting aside funds for work-
based literacy projects within Welfare-to-Work competitive grants (se welfare section of this memo);
(2) Community: expanding the infrastructure and funding for adult basic education through the Adult
Education program, encouraging the development of programs focused on easing the transition to
the U.S. for new immigrants (through ESL and civics classes), subsidizing the provision of child care
on college campuses and other adult education sites, and launching a national information campaign
to make people aware of the problem of functional illiteracy and of available services; and (3) Home:
using the new Learning Anytime Anywhere Partnerships to create software for adult basic education
using $200 computers (e.g., WebTV, game players) and subsidizing public housing projects that
create computer literacy programs. (NEC)
8. National Campaign to Open Doors of College. Notwithstanding enormous strides we have
made in reducing the financial barriers to college, too many families assume college is more
expensive than it really is and are not aware of the aid that is available (Even among low-income
youth with high test scores, one-fourth say they have not been able to get much information about
financial aid for college). We are planning: (1) launching a major national public information
campaign about college costs and financial aid (e.g. naming a national chairman such as Bill Cosby,
having a national college visit day, etc.), (2) building on the authority in the new GEAR UP
program, providing every middle school (e.g. 7th grade counselor) with the ability to give students
a "21st Century Scholar Certificate," indicating the financial aid that they are eligible for, and (3)
seeking to provide every high-poverty middle school with a college partner. This does not require
any new investment, just some focus and creativity. (NEC)
9. Improving the College Success Rate. Getting people in the doors of college is not enough to
close the racial and income opportunity gaps. For example, only 21% of African-American and
18% of Hispanic students who begin college complete a bachelor's degree within 5 years compared
to 30% of White students. We are considering a package of policies, including: (1) a super-Pell
grant for the lowest income families and/or to encourage a full-time focus on school in the first year
of college (this would be expensive); (2) expanding successful mentoring and other support services
in colleges (including those aimed at graduate school preparation); (3) promoting college course-
taking while in high school; (4) improving maticulation between two-year and four-year colleges;
(5) encouraging partnerships between predominately minority-serving and predominately majority-
serving institutions of higher education (particularly to promote graduate study); and (6) establishing
a bridge fellowship program for graduate study in science and technology fields for minorities and
women. (NEC)
10. School Modernization. The current assumption is that we will repeat this year's proposal for
tax credits to build and renovate schools covering the interest on nearly $22 billion in bonds. We
are, however, critically comparing our current proposal against other possible mechanisms to ensure
4
we have the most effective approach. (NEC)
11. Further Expanding Junior ROTC. In response to the Los Angeles riots, Colin Powell
proposed and Congress approved in 1992 an expansion of the high school-based JROTC. Since
then, 1,000 units have been added primarily in urban areas, bringing the total to nearly 2,600 units
with 400,000 participants. The budget increased over that period from $76 million to $166 million.
There is a waiting list of more than 450 schools that would like to have a JROTC unit. Because
DOD does not plan any further expansion, these 450 schools on the waiting list will not likely be
added. We could propose adding another 900 units over the next few years, to reach the authorized
maximum of 3,500. Cost: about $235 million. (NEC)
12. Training American Workers for Current and Future Skills Gaps. We should
challenge the private sector to make specific commitments to train more American workers, which
they pledged to do during the debate on H1-B visas. They could provide more college scholarships
for women and minorities, partner with community colleges to develop cutting-edge curricula, and
encourage their employees to serve as telementors for middle school students to get them excited
about math and science. In addition, we are working on: (1) a program to foster partnerships
("Regional Skills Alliances") between industry and training providers to train both employed and
unemployed workers; (2) competitive grants to encourage companies to develop programs in which
they subsidize the training of individuals who they then commit to hire; (3) extensions and/or
expansions of some of the current training tax provisions (such as the lifelong learning tax credit and
Section 127) and (4) a major informational/media campaign by the Departments of Education and
Labor to inform all Americans about available training opportunities, financial aid, and job search
assistance to allow them to develop the skills required for employment opportunities around the
country. (NEC)
13. Making Job Training Universal. We are considering an initiative to make job training more
universal. The first component of this initiative would be to seek a significant increase in dislocated
worker funding -- about $190 million -- so that we are on path to provide training to every dislocated
worker who wants or needs it within five years. The second component would be to ensure that
every unemployed person is eligible for core labor market services, e.g., job search assistance. The
final component would be to take the steps necessary to ensure that every worker, regardless of
where they live, would be able to have access to a One-Stop Career Center (where they can learn
about job training, employment service activities, unemployment insurance, vocational
rehabilitation, adult education, and other assistance.) (NEC)
14. Community Computing Centers. We have roughly 650 computing community centers, which
empower low-income Americans in the Information Age by teaching them to type a cover letter and
a resume, search for job vacancies on the Internet, or even start an Internet-related business. These
efforts should be expanded. (NEC)
School safety - see CRIME section
5
SERVICE (DPC)
1. AmeriCorps Seniors. In the wake of John Glenn's return to space, we have an opportunity to
give other senior citizens a mission. We propose adding $25 million to the current AmeriCorps
program to create a senior corps of 10,000 volunteers to serve as tutors and mentors and in
afterschool programs. We would build on a successful demonstration program that recruits seniors
to serve 15-20 hours per week over a fixed period of time in schools and other community centers.
In exchange, seniors would be eligible for small incentives, including awards to participate in senior
learning programs. By inspiring responsibility among seniors, this initiative would provide an ideal
complement to Social Security reform. John Glenn has expressed some interest in playing a role in
AmeriCorps now that he's retired. We could invite him back to the State of the Union and place him
in charge of a national effort to inspire seniors to serve. (Cost: $25 million)
2. Expand AmeriCorps. We propose expanding the AmeriCorps program from its current level
of 50,000 members per year to approximately 70,000 per year, with the goal of reaching 100,000
per year by the end of this Administration. These additional members could be targeted to serve
primarily in after-school and summer school programs. (Cost: $75 million)
3. Expand Service Component of Work-Study Program. Nearly 1 million students now receive
federal work-study funding. Despite our efforts, colleges and universities are required to use only
7 percent of their work-study money for students employed in community service. The higher
education lobby would object, but we could propose a substantial increase in that requirement -- e.g.,
phasing it up to 25 percent over the next 3 years.
HEALTH CARE AND DISABILITIES (DPC/NEC as specified below)
1. Long-Term Care Initiative. This package could include: (1) a tax credit of up to $1,000 for
people with three or more limitations in activities of daily living (ADL) or their caregivers, at a cost
of about $6 billion over 5 years; (2) a plan for OPM to offer federal employees a choice of
high-quality private long-term care insurance policies at lower-than-market prices; (3) a family
caregiver support program, costing about $500 to $750 million over five years, that would provide
grants to states for "one-stop shops" to assist families who care for severely impaired elderly
relatives through counseling, training, and respite services; and (4) a nursing home quality initiative,
costing about $500 to $750 million over five years, that would include new enforcement provisions
(e.g., increased penalties), new funds for surveys of repeat offenders and improved surveyor training,
and perhaps a new commission to oversee HCFA's nursing home enforcement efforts and to
investigate other kinds of facilities where health care is offered (e.g., assisted living facilities).
(DPC/NEC)
2. Health Insurance Coverage Expansions. We could propose again, in new and improved forms:
(1) an initiative to encourage small businesses to form purchasing cooperatives for health insurance,
costing about $50 to 100 million over 5 years; (2) proposals to improve outreach for children's
health insurance; and (3) a proposal, more limited than last year's, to provide a Medicare buy-in for
6
certain people ages 55 to 65, benefiting about 30,000 people and costing $500 million over 5 years.
(DPC/NEC)
3. Biomedical Research. We should again propose an increased investment in biomedical research
-- perhaps (depending on how we treat tobacco money in the budget) between $500 million and $1
billion. (DPC)
4. Antibiotics (Super Bug) Initiative. Resistance to antibiotics is becoming a public health crisis,
causing prolonged illnesses and even death. A new initiative, costing about $25 million each year,
could address this problem through: (1) a major outreach and education campaign involving
hospitals, health professionals, and managed care organizations; and (2) new research and
surveillance efforts to understand where and why antibiotic resistance occurs and to develop
effective responses. (DPC)
5. Bioterrorism Initiative. This initiative, costing $100-300 million each year, would: (1) train
epidemic intelligence officers who can coordinate with state health departments to identify and
respond to attacks; (2) develop a mass casualty emergency response system that includes primary
care, emergency transportation, and decontamination abilities; (3) create and maintain a stockpile
of pharmaceuticals; and (4) improve research to develop new vaccines and antibiotics to be used in
the event of attack. (DPC)
6. Prescription drug coverage for Medicare beneficiaries. We are considering a variety of
proposals to address the lack of coverage for prescription drugs in Medicare, including a
means-tested Medicaid option, an approach that would apply only in managed care, a traditional
benefit for all beneficiaries, and an unsubsidized purchasing mechanism that uses Medicare's size
as leverage for drug discounts for beneficiaries. If desirable, a proposal could be included in the
budget or coordinated with the March release of the Medicare Commission's recommendations. The
cost varies significantly depending on the proposal, ranging from $1 to 20 billion a year. A proposal
of this kind probably would depend on tobacco funding (see tobacco section below). (DPC/NEC)
7. Protecting beneficiaries from HMO withdrawals from Medicare. This year, a number of
HMOs pulled out of Medicare with only a few months notice, leaving 50,000 beneficiaries with no
plan options in their areas. You announced that the Administration would develop legislation to
prevent this behavior in the future, and we are currently reviewing the best approaches. (DPC)
8. Redesigning and increasing enrollment in Medicare's premium assistance program. Over
3 million low-income Medicare beneficiaries are eligible but do not receive Medicaid coverage of
their Medicare premiums and cost sharing. Many more may not get enough assistance through a
new provision that is supposed to help higher income beneficiaries. We are developing a range of
proposals, costing up to $500 million over five years, to use Social Security Offices to educate
beneficiaries about this program, reduce administrative complexity for states, and give them
incentives to engage in more aggressive outreach efforts. (DPC/NEC)
7
9. Disease Initiatives. We are working on several initiatives designed to combat particular diseases.
These initiatives, which you could choose to do individually or in combination, are: (1) an asthma
initiative, which will curb recent steep increases in asthma cases especially among young children,
by disseminating new treatment guidelines to state and local public health programs and encouraging
them to work with schools, child care organizations, businesses, and other community organizations;
(2) a mental illness initiative that will accompany a Surgeon General's report on this subject (and
perhaps a White House Conference recommended by Mrs. Gore) and will include public-private
partnerships to improve access to prevention and treatment, reforms in federal health programs to
improve delivery of mental health services, and funding increases in the mental health block grant;
and (3) a heart disease initiative, which could include: a new partnership with aging networks to
evaluate and improve nutrition; efforts to measure successful prevention approaches and replicate
them nationwide; and the creation of a network of educators, churches, and community-based
organizations to launch a nationwide awareness campaign. In each of these initiatives, the public
health efforts described above would supplement NIH funding of research projects. The estimated
cost of these initiatives is $50 million for asthma, $100 million for mental illness, and $20 million
for heart disease. (DPC)
10. Food Safety. We are working on a food safety initiative that will highlight safety standards and
enforcement. Included in this initiative are: (1) a repackaged and somewhat modified legislative
proposal giving the FDA and USDA additional enforcement powers (e.g., mandatory recalls and
civil penalties); (2) additional food-specific regulations and/or guidelines (e.g., for certain fruits and
vegetables); and (3) more extensive adoption of our model codes for restaurants and food service
workers. In addition, we will focus on improving coordination with state and local agencies that
regulate food safety in order to develop a wholly integrated national inspection system. (DPC)
11. Disability - Health. A health-related disabilities package could include: (1) the Jeffords-
Kennedy Work Incentives Improvement Act, which enables people with disabilities to go back to
work by giving them an option to buy into Medicaid and Medicare, at a cost of about $1.2 billion
over 5 years; (2) a proposal, costing $50 million over five years, to promote the deinstitutionalization
of Medicaid beneficiaries by developing viable community-based care alternatives for people
residing in nursing homes after a "date certain"; and (3) a proposal to make Medigap supplemental
insurance more accessible to people with disabilities.
12. Diability - Getting People to Work. A work-related disabilities package could include: a tax
credit of $1,000 to $5,000 for working people with disabilities to assist them in paying for the costs
associated with employment, at a cost of about $1 to 2 billion over 5 years; a new competitive grant
program, developed by your disabilities task force, to increase the employment rate of adults with
disabilities; and efforts to ensure that new technologies are designed so as to be accessible to people
with disabilities (see technology section). (DPC/NEC)
8
TOBACCO (DPC)
1. State Menu. Our best vehicle for enacting tobacco legislation next year will be a legislative
waiver of federal Medicaid claims to the states' expected $200 billion settlement with the tobacco
companies. We will seek bipartisan agreement on a menu of uses for the federal share of state
money, with tobacco control and child care as our top priorities. We will try to use this measure as
a vehicle for other key elements of our tobacco policy, such as FDA jurisdiction and warning labels.
2. Price Increase. One of the most difficult budget decisions will be whether to assume a tobacco
tax increase in our budget request, and if so, what to do with the money. There are strong arguments
on each side of the question whether to include a tobacco tax increase in our budget. If we do
assume tobacco revenue, the candidates for it include: (1) assistance to tobacco farmers (about $1
billion a year); (2) the long-term care tax credit (about $1 billion a year); (3) other tax cuts, such as
a child care / stay-at-home tax credit and/or a reduction in the marriage penalty; (4) NIH research;
(5) public health programs; and (6) the Medicare trust fund and/or a new prescription drug benefit
for Medicare beneficiaries.
3. Medicare Suit Against Tobacco Companies. Our best leverage over the tobacco industry is
the prospect of a federal suit to recoup Medicare costs associated with smoking. We could call on
Congress to enact Senator Graham's legislation to authorize such a lawsuit (which would make the
Justice Department more likely to bring it). At the same time, we could ask for funds for DOJ and
HCFA to prepare a lawsuit against the tobacco industry. We could go further and pledge that any
proceeds from such a lawsuit would be used either to extend the life of the Medicare Trust Fund or
to provide a new prescription drug benefit to Medicare beneficiaries. (Cost: to be determined, but
probably small).
FAMILIES AND CHILDREN (DPC/NEC as specified)
1. Expansion of the Child Care and Development Block Grant (old policy). We propose to
expand the Child Care and Development Block Grant as we did in the FY 1999 Budget. The block
grant is the primary federal child care subsidy program, helping low-income working families to pay
for child care. Currently, between one and two million children are served by the program, leaving
roughly nine million children who are eligible but unserved. This proposal would cost at least $7.5
billion over five years. (DPC)
2. Tax Relief for Parents, Including Parents who Stay at Home. We are considering replacing
our last year's proposal to expand the Child and Dependent Care Tax Credit with a new proposal to
benefit all parents, including those who stay home. This change will address the criticism that our
child care initiative did little for stay-at-home parents. We are reviewing proposals to (1) double the
child tax credit to $1,000 per child for all children under the age of four, at a cost of about $12 billion
over five years; (2) increase the standard deduction for each child under the age of three by $1,000,
at a cost of about $3 billion over five years; or (3) expand the Child and Dependent Care Tax Credit
as we did last year and extend its benefits to parents with children below age three by assuming
9
minimum child care expenses of $150 each month, at a total cost of about $21 billion over five years.
Each of these proposals can be dialed up or down by adjusting either the age threshold or the dollar
amount. (DPC/NEC)
3. Tax Credit for Businesses Providing Child Care. We could again propose to provide a tax
credit to businesses that provide child care services for their employees. The credit, which covers
25% of qualified costs but may not exceed $150,000 per year, costs $500 million over 5 years. To
further build on this concept, we also propose to provide tax credits to businesses that provide on-site
schools (see education section). (DPC/NEC)
4. Parent Paid Leave Plan. Many workers cannot afford to take unpaid leave following the birth
or adoption of a child, even though they have access to an unpaid leave policy through FMLA or
voluntary employer benefit plans. To address this problem, we are considering a proposal to provide
eligible parents who already have access to unpaid leave with partial wage replacement for a set
period of time. The cost of the program, which would be administered through the Unemployment
Insurance System, varies according to the selected eligibility criteria. If we choose, for example, to
give $200 per week for four weeks to new parents with median income (about $37,000) or below,
the cost will be about $875 million for FY 2000 (including start-up and administrative expenses).
(DPC)
5. FMLA Expansion to Businesses with 25 Workers (old but unarticulated policy). Under
current law, workers are eligible for FMLA coverage only if they work at a business with 50 or more
employees and if they have worked at least twelve months and 1,250 hours for the employer. In
your last State of the Union, you called for covering more workers under the FMLA, but did not
fully articulate how you would do so. We could now advance a specific proposal to lower the
FMLA threshold to 25 or more workers, which would expand coverage for up to ten million more
American workers. (DPC/NEC)
6. Parent Education and Support Fund. We are considering proposals to create a competitive
grant program administered by HHS to fund parent education and support programs, including home
visitation programs and "second chance maternity homes" to support teen mothers and teach
parenting skills. This fund could cost about $500 million over five years. (DPC)
7. Adoption Registry. We are working on plans to create an Internet-based adoption registry of
foster care children waiting to be adopted, so that prospective adoptive parents can learn about these
waiting children. Funding this registry would require a very small increase in HHS's Adoption
Opportunities Grant Program. (DPC)
CRIME (DPC)
1. Crime Bill II. The 1994 Crime Act will expire at the end of the FY 2000 budget cycle,
guaranteeing that the next Congress will consider major crime legislation. We recommend that you
get a jump on this debate by using your State of the Union and FY 2000 budget to challenge
10
Congress to pass a new crime bill that builds on the core elements of the successful 1994 Act -- more
police, smarter punishment, and more prevention. Most of the money required is already built into
future budgets; continuation of the COPS program, however, will require new funds totaling about
$1 billion. We believe that a new Crime Act should include the following elements:
Community-Oriented Policing and Prosecution Services (COPPS). Your pledge to help
fund 100,000 more police is likely to be fulfilled before the end of next summer. A new
COPPS initiative (note the extra "P" for "Prosecution"), costing about $1.4 billion in the first
year, could include funds to: (1) hire, redeploy, and retain an estimated 7,500 more police
each year; (2) provide modern technology and equipment and support training in modern
policing techniques, with a special emphasis on "hot spots" technology; (3) hire, train, and
equip prosecutors to join local police in fighting crime on a more community-based, pro-
active basis; and (4) support partnerships between law enforcement and community-based
groups to prevent crime in their areas.
A new focus on probation supervision and coerced abstinence. The punishment title of
the crime bill now focuses largely on prison construction; we recommend shifting the focus
to a new "Certainty of Punishment" initiative that will support the expanded use of probation
supervision and of drug testing and treatment.
Gun initiatives. A new crime bill should include your longstanding firearms priorities --
juvenile Brady, Brady II, federal CAP legislation and child safety locks. It also could
include new proposals to: (1) close the loophole that exempts many firearms sales at gun
shows and flea markets from Brady background checks; (2) expand the Youth Crime Gun
Interdiction Initiative (YCGII) -- to trace all crime guns and investigate gun traffickers -- to
an additional 20-40 cities; and (3) assemble gun strike forces -- teams of federal prosecutors
and ATF agents, acting with local law enforcement -- to target cities with high levels of gun
violence and crack down on gun traffickers.
Values-based crime prevention initiative. In addition to other crime bill prevention
programs, we could invest in promoting values-based crime and violence prevention efforts,
such as those of Rev. Eugene Rivers. Funds from this program would go to comprehensive
prevention programs run by faith-based and other institutions seking to instill and reinforce
common sense values in troubled youth.
2. Safe, Disciplined, and Drug-Free Schools. At the White House Conference on School Safety,
you announced that you would overhaul and strengthen the Safe and Drug-Free Schools Program.
Under this proposed reform, funds will be appropriately targeted to schools with serious drug and
crime problems, and schools will have to adopt rigorous, comprehensive school safety plans that
include: tough but fair discipline policies, such as zero tolerance for guns and drugs; safe passage
to and from schools; effective drug and violence policies and programs; annual school safety and
drug use report cards; links to after school programs; efforts to involve parents; and crisis
management plans. We also could include in this package (1) funds for states that adopt a policy
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of drug testing first-time applicants for drivers' licenses and (2) funds for school districts that adopt
a policy of drug testing middle and high school students with parental consent. We believe that these
reforms will require up to $450 million in new funding in FY 2000.
3. Parity for Substance Abuse Treatment. Appropriate substance abuse treatment remains
unavailable to nearly half of the people who need it. To help fill this treatment gap, we could
propose legislation to encourage parity between substance abuse treatment and other medical
benefits. Similar to the Mental Health Parity Act signed into law in 1996, a current draft of this
legislation would prohibit health care plans that provide a substance abuse benefit from setting
annual or lifetime dollar limits on this benefit at a lower level than those for other medical and
surgical benefits. At the same time, we would have to ensure that federal health programs provide
parity between substance abuse treatment and other medical benefits; we are still exploring the cost
of any necessary reforms to these programs.
4. Binge Drinking. We are working on a number of proposals regarding alcohol abuse, including
(1) promoting a voluntary code for alcohol advertisements directed toward minors; (2) banning
alcohol billboards near schools; (3) discouraging alcohol advertising on youth-oriented web sites;
(4) and funding educational efforts about the dangers of alcohol consumption.
PENSIONS (NEC)
1. Expanded Private Pension Plan Coverage: Last year, you announced several initiatives to
expand pension plan coverage which were not enacted, but which we continue to believe are
important and have substantial support on the Hill. We should again call for legislation that:
authorizes a simplified plan for small businesses that combines the best features of a defined benefit
and defined contribution plan (SMART), costing $313 million over five years; provides a three-year
tax credit to encourage small businesses to set up retirement programs, costing $508 million over
five years; and authorizes payroll deductions for IRAs. We are exploring ways to expand coverage
for moderate and lower-income workers. Consideration is also being given to ways of enabling
multiple small businesses to pool together for pension plan administration.
2. Women's Retirement Security: To underscore the importance of pensions for women's
retirement security, you would call for legislation enacting the two initiatives you announced in late
October -- namely, that time taken under FMLA should count toward retirement plan vesting
requirements and mandating that employer plans offer an option that pays less while the retired
employee is living but pays a survivor benefit equal to at least 75 percent of the benefit the couple
received while both were alive.
3. Pension Portability: You could renew your call for reducing vesting requirements from five years
to three years for employer matching contributions to 401(k) and other plans to reflect an increasingly
mobile workforce, and more workers moving in and out of the workforce over a lifetime. We are also
exploring various options that would increase pension portability and facilitate the movement of
retirement savings between plans, where this can be done without encouraging "leakage" or loss of
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worker protections -- e.g., providing that federal employees can roll over retirement savings from
private sector qualified plans into the federal Thrift Savings Plan.
4. Expand Pension Right to Know Provisions: You could call for a pension right to know package:
that provides for both workers and their spouses general information relating to retirement needs and
their benefits under employer retirement plans. In addition, an employee's spouse should have the
same rights to get information as the employee, before waiving the statutorily provided survivor
protection. You should call for a Pension Right to Know package that provides information for both
workers and their spouses. We are also working on an employee education program that would
provide employees with the tools they need to work with their employers to provide pension plans,
and are thinking about how to encourage courses in high schools on the importance of savings and
other general investment education (which can be combined with the Consumer Literacy and
Education campaign described below). Consideration is also being given to a savings stamp book
program in the schools (sell savings stamps in very small amounts; when the book is full, turn it in
for a U.S. savings bond) to help educate the young about how to reach savings goals.
5. Increase Retirement Security: To promote security, we are continuing to work on the pension
audit bill, changes to the multi employer (collectively bargained) plan rules, and expansion of
PBGC's missing participant program.
COMMUNITY EMPOWERMENT (DPC/NEC for all)
1.
CDFI Tax Credit. We are looking at a proposal to extend tax incentives to encourage
investment in CDFIs, which would leverage additional private investment in distressed areas and
stimulate the economic revitalization of those areas. Under the proposal, $100 million in non-
refundable tax credits would be made available to the CDFI Fund to allocate among equity investors
in qualified CDFIs using a competitive process.
2. Microcredit Initiative. We are working to identify means to increase support for
microenterprise finance, both domestically and internationally. We are examining whether to build
on Senators Kennedy's and Domenici's PRIME legislation which would provide technical assistance
to microenterprise. We are also looking at increased funding for CDFI initiatives specifically
targeted to microenterprise. On the international side, we are looking at whether we can increase
microenterprise funding through USAID or MDBs, especially to countries hardest hit by the
financial crisis.
3. Clean Water, Parks, and Communities Bonds. We are examining three proposals to
encourage "green" infrastructure projects. The first model uses the same financing mechanism as
your school construction proposal for a menu of projects: protecting and improving water quality;
cleanup of contaminated sediments; waterfront reclamation and revitalization; stormwater runoff
control; purchasing of green spaces to prevent sprawl; park enhancements and revitalization, and
brownfields cleanup. The second model, which provides a smaller incentive than the first model,
would create new tax-exempt bond authority for these state and local areas to invest in clean water,
13
parks, and communities. The advantage of this model is that it builds on the current system of bond
finance. The final model would allocate tax credits (like the Low-Income Housing Tax Credit) to
states and local areas to provide to the developers of these green infrastructure projects.
6. Low-Income Housing and Homeownership Tax Credits. We recommend that you again
propose a 40-percent expansion of the Low-Income Housing Tax Credit, which would help develop
an additional 150,000-180,000 affordable housing units over the next five years, at a cost of $1.6
billion over five years. In addition, we are examining two kinds of tax credits to promote
homeownership among lower-income families. The first proposal would use the model of the Low-
Income Housing Tax Credit to create a Low-Income Homeownership Tax Credit. Under this
proposal, low-income families would receive a low- or zero-interest second mortgage, which would
reduce their upfront costs (e.g., downpayment and closing costs) and investors would receive tax
credits in return. The second proposal is a $5,000 tax credit for first-time homebuyers in
Empowerment Zones or Enterprise Communities. Finally, you can call on Congress to accelerate
the increase in the volume cap on private activity bonds, which would help states and localities
provide below-market mortgages to first-time homebuyers with relatively low incomes.
7. Housing for the Elderly Initiative. This proposal is designed to improve housing for elderly
people and thereby provide an alternative to nursing home care. In addition to providing capital to
improve and modify such housing to meet the needs of elderly residents, the initiative would provide
housing vouchers for low income elderly who live in housing developed through the Low-Income
Housing Tax Credit. Because the tax credit helps subsidize rent, this proposal would allow us to
leverage our resources and provide more vouchers to the poor elderly.
8. Re-Develop 10,000 Abandoned Buildings. Abandoned buildings are a symbol of urban blight,
and an action plan to turn this around will be a powerful signal of change. We are examining
different proposals to help re-develop 10,000 abandoned buildings, combining several existing
programs or providing grants or tax incentives to spur private-sector redevelopment of these sites.
9. Homelessness. We are working on a three-part proposal that would: (1) assist the approximately
250,000 homeless veterans by increasing residential alternatives, community-based contracted care,
job preparation activities, stand down activities (community-sponsored events that conduct one-stop
service delivery programs for homeless veterans), the distribution of clothing, and long-term
housing; (2) allow VA to sell surplus property with 10 percent of proceeds going to homeless
veterans; and (3) start a demonstration project targeted to the chronically homeless to test the most
promising models for moving the chronically homeless to self-sufficiency using a combination of
permanent housing and links to mainstream services. Cost: $105 million -- $60 million for VA and
$45 million for HUD demonstration project.
RURAL/AGRICULTURE (NEC/DPC as specified)
1. Strengthening the Safety Net. To help farmers suffering from the depressed export markets and
natural disasters, we are considering various reforms of the crop insurance program and closing gaps
14
in the emergency loan program. We are paying special attention to programs that will help small
family farms. (NEC)
2. Bringing the knowledge of land grant colleges to every rural American: The USDA spends
$1.6 billion on agricultural research, much of it at America's land grant colleges and universities.
The government could provide grants to ensure that this information is available on the Internet and
is well-organized --SO that all rural Americans can easily access information on topics such as crops,
livestock, rural development, natural resource conservation, and food safety. (NEC)
3. Emergency Medical Services in Rural Areas. The presence of viable emergency systems is
critical for residents in rural areas, because of the high rates of injury associated with jobs in these
areas and the long distances to health providers. This proposal, costing about $50 million, would
provide funds to States and local communities to improve access to 911 services or alternative
emergency systems. It also would fund programs to help rural communities train local citizens in
CPR and first responder techniques and to recruit and retain emergency personnel. (DPC)
4. Rural Transportation. Transportation is crucial to the efforts of residents and businesses in
rural America to improve the livability of their communities and expand their economic activities.
We are developing a rural transportation initiative that will help those who live and work in rural
areas by improving the ability of farms and businesses to obtain materials and move their products
to markets, and by making it easier for small communities to attract additional commercial jet air
service. (NEC/DPC)
TECHNOLOGY (NEC)
1. Curbcuts on the Information Highway. We are looking at several options that would make
information technology usable by people with disabilities in a manner that improves their lives: (1)
investing in R&D (e.g., text-to-speech, automatic captioning, speech recognition); (2) giving
disabilities groups a seat at the table as the standards for new technologies are developed; (3) making
the government a model "user" of accessible technology; and (4) explore opportunities for greater
deployment. In addition, the tax credit for work-related impairment expenses for people with
disabilities could be used to expand the market for assistive technology.
2. A Digital Library for Science, Math and Engineering. We need to get every young student
and undergraduate excited about math, science and engineering. We are exploring creating a "digital
library," which would contain lectures from Nobel Prize laureates, have an ability to track and
replicate cutting-edge scientific experiments, and make it easier for students and teachers to locate
the best instructional material on the Internet.
3. Information Technology Research Initiative. Increasing our investment in information
technology research, which is currently about $1 billion of the federal research budget, could lead
to the following breakthroughs: supercomputers that can more rapidly perform important functions,
such as designing life-saving drugs and predicting severe weather systems; wireless networks that
15
can bring telemedicine and distance learning to rural America; a device of the size of a paper that
could monitor the vital signs of a senior citizen, send a "911" message in the event of a medical
emergency, and provide an exact location using global positioning technology; new software tools
that can help us cope with "information overload" by discovering patterns in huge quantities of data;
and intelligent spacecraft that can explore the Solar System. Options have been developed at
roughly $100, $200 and $400 million in FY2000; and $1, $2 and $3 billion over 5 years.
4. 21st Century Research Fund. One initiative that you announced in last year's budget that we
think is important to continue is the 21st Century Research Fund -- which provided across-the-board
support for civilian R&D at agencies such as NIH, NSF, and Energy. For FY99, Congress provided
a 10 percent increase for basic research, so this is an area where bipartisan cooperation is possible.
Currently, the FY2000 budget reflects only a 2% increase in civilian research.
WELFARE REFORM, CHILD SUPPORT ENFORCEMENT, AND CHILD WELFARE (DPC)
1. Reauthorize the Welfare-to-Work Program. Congress authorized the Welfare-to-Work
Program for only two years; if we wish to continue our current investment in the hardest-to-employ,
we will have to propose a reauthorization of about $1.5 billion annually. Within this funding level,
we propose several set-asides, totaling $500 million, for the following specific purposes: (1) work-
based English-language literacy projects for immigrants and others; (2) work-based substance abuse
testing and treatment programs; (3) employment services for welfare recipients with disabilities; and
(4) a work-based program to promote responsible fatherhood, including efforts to increase low-
income fathers' employment and earnings and ensure that they provide financial and other support
to their children. At the same time, we should (1) seek an additional 50,000 welfare-to-work housing
vouchers, and (2) call on Congress to make permanent the Welfare-to-Work Tax Credit and the
Work Opportunity Tax Credit, both of which now expire on June 30, 1999.
2. Child Support. One initiative, costing just a few million dollars each year, would increase the
prosecution of egregious child support violators by establishing multi-agency teams, working with
state and local law enforcement, to identify, analyze, and investigate cases for prosecution. A pilot
project of this kind is already under way in five states; this proposal would put these units in place
all across the nation within the next several years. A second initiative would seek legislation to
exclude doctors and other health care providers who are delinquent in child support from the
Medicare program or from programs offering health professional loans.
3. Children "Aging Out" of Foster Care. Each year, nearly 20,000 18-year-olds "age out" of the
public child welfare system. Federal financial support for these young people ends just at the time
they are making the critical transition to adulthood. Areas for increased investment for these young
adults include: (1) expanding the independent living program, which provides services to foster care
children in this age group; (2) expanding the transitional living program, a competitive grant
program that funds community-based organizations that provide services to this population,
including housing support; and (3) giving states the option of using Federal Medicaid dollars to
provide health care coverage for this population. (Cost: roughly $150 million each year)
16
CIVIL RIGHTS AND WOMEN'S RIGHTS (DPC)
1. Equal Pay. We are working on a program to be run by the EEOC and DOL to increase outreach
to businesses and employees about equal pay requirements, provide technical assistance to
businesses seeking to comply, improve training for EEOC employees, and expand enforcement
capabilities. In addition, the program will fund research on the nature and extent of wage
discrimination, as well as a new Women in Non-Traditional Occupations Initiative designed to
improve access of women into occupations such as construction and high technology. Cost: about
$20 million for EEOC and $10 million for DOL.
2. Abortion Violence. We are working on a comprehensive initiative to address violence against
providers of reproductive health services. This initiative may include: (1) a National Task Force
established by the Department of Justice that will conduct investigations of abortion violence, collect
and collate information related to clinic violence, and provide training to federal, state, and local law
enforcement personnel on how to address this problem; (2) special security measures, including
stepped-up U.S. Marshal support, at clinics identified to be at risk of violence; and (3) federal
guarantees of loans taken out by clinics that must rebuild after they have been attacked. Cost:
Unknown at this time.
TRANSPORTATION (NEC/DPC as specified)
1. Reauthorization of the FAA, with Focus on Modernization and Competition. A blue-ribbon
bi-partisan panel concluded last year that the air transportation system faces "gridlock" within a
decade without sweeping changes. We are considering various policy options to incorporate into
the FAA reauthorization that you will propose in 1999 (it is a must pass this year) that will: (1)
improve the efficiency and capacity of the nation's aviation system, and (2) enhance competition and
service to rural areas. Some of the components of this initiative would include: centralizing the air
traffic control services (ATS) in a performance-based organization (recommended by the bi-partisan
panel); financing ATS for commercial aviation through cost-based user fees (supported by the major
airlines); increasing Passenger Facility Charges (PFCs) to finance airport expansion nationwide
(supported by state and local governments); modifying federal rules on how airports can use PFCs
and other funds to encourage new airline entrants; and enhancing service to underserved areas.
We are also looking at ways to further competition in international aviation. The Administration has
extended the benefits of competition by negotiating dozens of bilateral open-skies agreements. We
could press our trading partners for World Wide Open Skies and explore lifting other restrictions on
foreign aviation investment and operation on a reciprocal basis. (NEC)
2. Auto Safety. We are making headway on auto safety. Last year, the number and rate of auto
fatalities declined. However, we still have a long way to go -- more than 40,000 Americans die in
auto accidents each year, at a direct cost of $150 billion. The keys are seatbelts (more) and alcohol
(less). We are working on a comprehensive initiative that would include: (1) meeting the President's
goal of 85 percent seatbelt compliance by the year 2000, which would save 4,000 lives and nearly
17
$7 billion; (2) promoting education initiatives like the Buckle-Up America campaign; (3) enforcing
the TEA-21 requirement that states lower the legal blood alcohol content level from 10 to .08; and
(4) pushing a new Administration initiative on children's safety that will target auto accidents, among
other problems, by promoting the use of child safety seats, booster seats (for children ages 4-8), and
bicycle helmets. (NEC/DPC)
3. Transportation Needs of the Aged. With the number of Americans over 65 expected to grow
by half by 2020, we should begin addressing the need to ensure their continued mobility,
independence and safety in their later years. We are only beginning to look at this issue with DOT,
which plans to hold six town meetings soon with senior citizens, medical experts, transportation
safety specialists, and others to discuss the problems and challenges and identify best practices. The
U.S. will host an international conference on this topic next year, in connection with the United
Nation's Year of Older Persons. This may be combined with the long-term care and the housing for
the elderly initiatives. (NEC)
4."Smart Growth" and Sustainable Development. One of the biggest challenges facing
America's communities is that "sprawl" development is threatening the long-term economic vitality
and quality of life in America's urban, suburban and rural areas. Although land use decisions should
remain the domain of state and local government, the federal government can be an effective partner.
First, we will continue investing in sustainable transportation. TEA-21 authorizes a record $41
billion over the next six years for transit; increases tax-free transit benefits; and expands
communities' ability to transfer funds from highway construction to transit, bicycle and pedestrian
programs, telecommuting and other forms of transportation that reduce congestion and pollution.
Second, we will provide incentives to make it easier for communities to pursue smart growth
policies, by exploring ways cities can capture the air quality benefits of sustainable development
and by supporting a private sector initiative that would encourage mortgage lenders to consider the
savings from "location efficiency"in making mortgage determinations for homebuyers (NEC)
ENERGY (NEC)
1. Electricity Restructuring. You could call on Congress to enact legislation, to make the
electricity industry more competitive and to provide more choices for industrial, commercial and
residential customers. The Administration's Comprehensive Electricity Competition Act will save
consumers $20 billion a year. Retail competition will not only improve efficiency, but also reduce
the two-thirds waste of energy currently associated with fossil-fuel generation of electricity, thereby
cutting greenhouse gas emissions. Prominent Republicans have included electricity restructuring
on their list of priorities for 1999.
2. Distributed Generation ("Micropower"). To increase the consumer savings and environmental
benefits from electricity competition, the Administration will pursue legislation to eliminate
obstacles to the use of small, clean efficient generation technologies (e.g., fuel cells and
photovoltaics) that can be installed at or near the electricity user's site. Moving from large, central-
station generation of electricity to distributed generation by small, clean sources is analogous to the
18
move from mainframe computers to personal computers.
FINANCIAL SERVICES (NEC/DPC as specified)
1. Consumer Financial Literacy and Education. We are currently developing a set of proposals
to promote consumer financial awareness and enhance consumer credit literacy, ranging from a
public awareness campaign to establishing an educational clearinghouse to disseminate quality
curricula to high school students. We are also working on a study to identify what the biggest
problems are with how Americans use consumer credit, and what basic banking services and steps
they can take to help themselves (this may be very important if bankruptcy reform is a live item next
year). Part of our focus is on reaching out to low-income households, building on (and expanding)
two existing government programs -- Treasury's Electronic Funds Transfer program that was a first
step in helping the "unbanked" enter into electronic commerce and a USDA extension program that
is providing some (limited) services to rural low-income families. This proposal would cost $5-10
million. (NEC)
2. Consumer Financial Bill of Rights. In order to respond to the outrage consumers feel about
ATM surcharges, without supporting economically questionable regulation of ATM fees, we are
considering a proposal either for the government or for financial institutions voluntarily to make
publicly available a list of basic banking services and fees on an individual or geographic basis to
be published periodically over the Internet. The services profiled would include, but would not be
limited to, charges for access to ATMs. We are also considering the adequacy of current credit card
disclosure requirements (again, relevant to bankruptcy reform) and other areas where information
about financial service arrangements would be helpful to consumers. This would cost $3-5 million.
(NEC/DPC)
November 5, 1998
MEMORANDUM FOR THE PRESIDENT
FROM:
Bruce Reed
Gene Sperling
Elena Kagan
Sally Katzen
SUBJECT:
State of the Union/Budget Ideas
This memorandum provides a brief description of new ideas we are considering for the State of the
Union. Some work has been done on fleshing them out, but many need additional work and further
vetting through the interagency process. Most of these ideas involve increased spending, and you
will have to make choices among them and/or scale them back as you consider the FY 2000 budget.
Although our offices have worked together on many, if not most, of the ideas in this memo, we have
noted, where possible, which of our offices has the lead role with respect to each proposal. Options
relating to Social Security are not included in this memo.
EDUCATION AND TRAINING (DPC/NEC as specified)
1. Ending Social Promotion. Last year's budget proposal included $200 million for Education
Opportunity Zones in districts that agreed to remove bad teachers, turn around failing schools, and
end social promotions. The proposal required authorization, which Congress will never give us. For
next year, we recommend a simpler approach that uses existing authority and focuses entirely on
ending social promotion. We would like to expand our after-school program from $200 million to
$700 million and give a disproportionate share of this money to districts that end social promotion.
These school districts could use the money (as Chicago does) to provide extra help after school and
mandatory summer school for students who need it. (Cost: $300 million above FY99 budget.)
(DPC)
2. Teacher Quality and Recruitment. Now that we're on track to begin hiring 100,000 new
teachers to reduce class size, we have an even greater responsibility to help communities attract
talented new teachers to the profession. We envision a five-part strategy on teacher quality and
recruitment: (1) a $100 million increase in the teacher recruitment scholarships we enacted this year
in the Higher Education Act, which would put us on course to attract 60,000 new teachers at high-
need schools over the next five years; (2) a $60 million initiative -- modeled after the successful
Troops-to-Teachers program -- that would help states expand alternative certification routes and
attract talented people from other professions, such as military personnel and employees in firms
being downsized; (3) a nationwide crackdown on teacher education schools, including new
regulations authorized by the Higher Education Act to require report cards for education schools;
2
(4) a $50 million increase in the Eisenhower program to send secondary school teachers who teach
outside their field back to college to take additional courses in the subjects they're teaching, coupled
with a new requirement that new secondary teachers pass competency tests in a subject before they
can teach it; and (5) a high-profile effort to help states make the most of the 15 percent set-aside for
teacher quality in the recently passed class size legislation. (Cost: about $210 million above FY99
budget). We are also exploring a politically interesting counter to private school choice: vouchers
for private school teachers -- i.e., an incentive program to encourage private school teachers to teach
in public schools. (DPC)
3. Work-Site Schools. One of the most promising new education ideas sprouting up around the
country is the creation of public schools at work sites, designed primarily to serve employees'
children. School districts provide the teachers and curriculum; companies provide facilities and
upkeep. These schools-at-work serve a host of objectives at once, by (1) providing new facilities
at no cost to the district; (2) increasing parental involvement in the schools and parental satisfaction
in the workplace; (3) reducing employee turnover and absenteeism; and (4) increasing school
diversity, because work sites are more diverse than residential neighborhoods. We propose a $100
million increase in an existing discretionary program to provide grants to 100 communities to launch
work-site schools. We also could seek a stand-alone bill (like the charter school law) to advance this
idea. In addition, we are working with Treasury to develop a tax credit for businesses that start on-
site schools, similar to the Kohl business tax credit for on-site child care that is already in our budget.
(Cost: $100 million for start-up grants. No estimate yet for tax credit, but it will be very small.)
(DPC/NEC)
4. Public School Choice. As support grows for private school vouchers, we must continue our
efforts to expand choices within the public schools. Charter schools are one answer, and we
recommend a $20 million increase, to $120 million, to keep us on track to 3,000 charter schools by
2002. Work-site schools are another. We also recommend increased funding for (1) an existing
grant program that helps urban and suburban school districts reduce racial isolation by forming
interdistrict magnet programs; and (2) magnet schools on university campuses, especially in urban
areas. (Cost: $25 million for interdistrict magnet programs; $15 million for 10 university-based
schools.) (DPC)
5. School Leadership Academies. Research has shown that an effective principal is the single
most important indicator of school success, yet little has been done at the national or state level to
improve the management skills of principals. We propose a small initiative to create school
leadership academies that would provide training in management, teacher evaluation, school
discipline, and other areas to elementary school principals in high-poverty districts. (Cost: $50
million) (DPC)
6. Class size. To stay on course to reach 100,000 new teachers in seven years, we will ask for $1.3
billion in the FY2000 budget. We are planning an ambitious rollout of the class size initiative over
the next year, as we award first-year funding, issue guidance to local districts on how the program
works, and so on. We also will press Congress to restore the local matching requirement and
3
strengthen the provisions to require competency testing of new teachers. (DPC)
7. Partnership for a Literate America. According to the National Adult Literacy Survey, 44
million adults struggle with a job application, cannot read to their children, or are left on the welfare
rolls because they lack basic skills. We are considering: (1) Workplace: a new tax credit and/or
Federal grants to encourage employers to provide adult basic education classes at the worksite, and
setting aside funds for work-based literacy projects within Welfare-to-Work competitive grants (se
welfare section of this memo); (2) Community: expanding the infrastructure and funding for adult
basic education through the Adult Education program, encouraging the development of programs
focused on easing the transition to the U.S. for new immigrants (through ESL and civics classes),
subsidizing the provision of child care on college campuses and other adult education sites, and
launching a national information campaign to make people aware of the problem of functional
illiteracy and of available services; and (3) Home: using the new Learning Anytime Anywhere
Partnerships to create software for adult basic education using $200 computers (e.g., WebTV, game
players) and subsidizing public housing projects that create computer literacy programs. (NEC)
8. National Campaign to Open Doors of College. Notwithstanding enormous strides we have
made in reducing the financial barriers to college, too many families assume college is more
expensive than it really is and are not aware of the aid that is available (Even among low-income
youth with high test scores, one-fourth say they have not been able to get much information about
financial aid for college). We are planning: (1) launching a major national public information
campaign about college costs and financial aid (e.g. naming a national chairman such as Bill Cosby,
having a national college visit day, etc.), (2) building on the authority in the new GEAR UP
program, providing every middle school (e.g. 7th grade counselor) with the ability to give students
a "21st Century Scholar Certificate," indicating the financial aid that they are eligible for, and (3)
seeking to provide every high-poverty middle school with a college partner. This does not require
any new investment, just some focus and creativity. (NEC)
9. Improving the College Success Rate. Getting people in the doors of college is not enough to
close the racial and income opportunity gaps. For example, only 21% of African-American and
18% of Hispanic students who begin college complete a bachelor's degree within 5 years compared
to 30% of White students. We are considering a package of policies to increase degree attainment
among low-income and minority students, including: (1) a super-Pell grant for the lowest income
families and/or to encourage a full-time focus on school in the first year of college (this would be
expensive); (2) expanding successful mentoring and other support services in colleges (including
those aimed at graduate school preparation); (3) promoting college course-taking while in high
school; (4) improving articulation between two-year and four-year colleges; (5) encouraging
partnerships between predominately minority-serving and predominately majority-serving
institutions of higher education (particularly to promote graduate study); and (6) establishing a
bridge fellowship program for graduate study in science and technology fields for minorities and
women. (NEC)
10. School Modernization. The current assumption is that we will repeat this year's proposal for
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tax credits to build and renovate schools covering the interest on nearly $22 billion in bonds. We
are however, critically comparing our current proposal against other possible mechanisms to ensure
we have the most effective approach. (NEC)
11. Further Expanding Junior ROTC. In response to the Los Angeles riots, Colin Powell
proposed and Congress approved in 1992 an expansion of the high school-based JROTC. Since
then, 1,000 units have been added primarily in urban areas, bringing the total to nearly 2,600 units
with 400,000 participants. The budget increased over that period from $76 million to $166 million.
There is a waiting list of more than 450 schools that would like to have a JROTC unit. Because
DOD does not plan any further expansion, these 450 schools on the waiting list will not likely be
added. We could propose adding another 900 units over the next few years, to reach the authorized
maximum of 3,500. Cost: about $235 million. (NEC)
12. Training American Workers for Current and Future Skills Gaps. We should
challenge the private sector to make specific commitments to train more American workers, which
they pledged to do during the debate on H1-B visas. They could provide more college scholarships
for women and minorities, partner with community colleges to develop cutting-edge curricula, and
encourage their employees to serve as telementors for middle school students to get them excited
about math and science. In addition, we are working on: (1) a program to foster partnerships
("Regional Skills Alliances") between industry and training providers to train both employed and
unemployed workers; (2) competitive grants to encourage companies to develop programs in which
they subsidize the training of individuals who they then commit to hire; (3) extensions and/or
expansions of some of the current training tax provisions (such as the lifelong learning tax credit and
Section 127); (4) a major informational/media campaign by the Departments of Education and Labor
to inform all Americans about available training opportunities, financial aid, and job search
assistance to allow them to develop the skills required for employment opportunities around the
country; (5) the adult literacy initiative described above; and (6) the "Improving the College Success
Rate" initiative described above. (NEC)
13. Making Job Training Universal. We are considering an initiative to make job training more
universal. The first component of this initiative would be to seek a significant increase in dislocated
worker funding -- about $190 million -- so that we are on path to provide training to every dislocated
worker who wants or needs it within five years. The second component would be to ensure that job
search assistance is available for every unemployed person. The final component would be to take
the steps necessary to ensure that every worker, regardless of where they live, would be able to have
access to a One-Stop Career Center (where they can learn about job training, employment service
activities, unemployment insurance, vocational rehabilitation, adult education, and other assistance.)
(NEC)
School safety see CRIME section
5
SERVICE (DPC)
1. AmeriCorps Seniors. In the wake of John Glenn's return to space, we have an opportunity to
give other senior citizens a mission. We propose adding $25 million to the current AmeriCorps
program to create a senior corps of 10,000 volunteers to serve as tutors and mentors and in
afterschool programs. We would build on a successful demonstration program that recruits seniors
to serve 15-20 hours per week over a fixed period of time in schools and other community centers.
In exchange, seniors would be eligible for small incentives, including awards to participate in senior
learning programs. By inspiring responsibility among seniors, this initiative would provide an ideal
complement to Social Security reform. John Glenn has expressed some interest in playing a role in
AmeriCorps now that he's retired. We could invite him back to the State of the Union and place him
in charge of a national effort to inspire seniors to serve. (Cost: $25 million)
2. Expand AmeriCorps. We propose expanding the AmeriCorps program from its current level
of 50,000 members per year to approximately 70,000 per year, with the goal of reaching 100,000
per year by the end of this Administration. These additional members could be targeted to serve
primarily in after-school and summer school programs. (Cost: $75 million)
3. Expand Service Component of Work-Study Program. Nearly 1 million students now receive
federal work-study funding. Despite our efforts, colleges and universities are required to use only
7 percent of their work-study money for students employed in community service. The higher
education lobby would object, but we could propose a substantial increase in that requirement -- e.g.,
phasing it up to 25 percent over the next 3 years.
HEALTH CARE (DPC/NEC as specified below)
1. Long-Term Care Initiative. This package could include: (1) a tax credit of up to $1,000 for
people with three or more limitations in activities of daily living (ADL) or their caregivers, at a cost
of about $6 billion over 5 years; (2) a plan for OPM to offer federal employees a choice of
high-quality private long-term care insurance policies at lower-than-market prices; (3) a family
caregiver support program, costing about $500 to $750 million over five years, that would provide
grants to states for "one-stop shops" to assist families who care for severely impaired elderly
relatives through counseling, training, and respite services; and (4) a nursing home quality initiative,
costing about $500 to $750 million over five years, that would include new enforcement provisions
(e.g., increased penalties), new funds for surveys of repeat offenders and improved surveyor training,
and perhaps a new commission to oversee HCFA's nursing home enforcement efforts and to
investigate other kinds of facilities where health care is offered (e.g., assisted living facilities).
(DPC/NEC)
2. Disability Proposals. A health-related disabilities package could include: (1) the Jeffords-
Kennedy Work Incentives Improvement Act, which enables people with disabilities to go back to
work by giving them an option to buy into Medicaid and Medicare, at a cost of about $1.2 billion
over 5 years; (2) a proposal, costing $50 million over five years, to promote the deinstitutionalization
6
of Medicaid beneficiaries by developing viable community-based care alternatives for people
residing in nursing homes after a "date certain"; and (3) a proposal to make Medigap supplemental
insurance more accessible to people with disabilities. A separate work-related disabilities package
could include: a tax credit of $1,000 to $5,000 for working people with disabilities to assist them in
paying for the costs associated with employment, at a cost of about $1 to 2 billion over 5 years; a
new competitive grant program, developed by your disabilities task force, to increase the
employment rate of adults with disabilities; and efforts to ensure that new technologies are designed
so as to be accessible to people with disabilities (see technology section). (DPC/NEC)
3. Health Insurance Coverage Expansions. We could propose again, in somewhat new and
improved forms: (1) an initiative to encourage small businesses to form purchasing cooperatives for
health insurance, costing about $50 to 100 million over 5 years; (2) proposals to improve outreach
for children's health insurance; and (3) a proposal, more limited than last year's, to provide a
Medicare buy-in for certain people ages 55 to 65, benefiting about 30,000 people and costing $500
million over 5 years. (DPC/NEC)
4. Biomedical Research. We should again propose an increased investment in biomedical research
-- perhaps (depending on how we treat tobacco money in the budget) between $500 million and $1
billion. (DPC)
5. Antibiotics (Super Bug) Initiative. Resistance to antibiotics is becoming a public health crisis,
causing prolonged illnesses and even death. A new initiative, costing about $25 million each year,
could address this problem through: (1) a major outreach and education campaign involving
hospitals, health professionals, and managed care organizations; and (2) new research and
surveillance efforts to understand where and why antibiotic resistance occurs and to develop
effective responses. (DPC)
6. Bioterrorism Initiative. This initiative, costing $100-300 million each year, would: (1) train
epidemic intelligence officers who can coordinate with state health departments to identify and
respond to attacks; (2) develop a mass casualty emergency response system that includes primary
care, emergency transportation, and decontamination abilities; (3) create and maintain a stockpile
of pharmaceuticals; and (4) improve research to develop new vaccines and antibiotics to be used in
the event of attack. (DPC)
7. Protecting beneficiaries from HMO withdrawals from Medicare. This year, a number of
HMOs pulled out of Medicare with only a few months notice, leaving 50,000 beneficiaries with no
plan options in their areas. You announced that the Administration would develop legislation to
prevent this behavior in the future, and we are currently reviewing the best approaches. (DPC)
8. Redesigning and increasing enrollment in Medicare's premium assistance program. Over
3 million low-income Medicare beneficiaries are eligible but do not receive Medicaid coverage of
their Medicare premiums and cost sharing. Many more may not get enough assistance through a
new provision that is supposed to help higher income beneficiaries. We are developing a range of
7
proposals, costing up to $500 million over five years, to use Social Security Offices to educate
beneficiaries about this program, reduce administrative complexity for states, and give them
incentives to engage in more aggressive outreach efforts. (DPC/NEC)
9. Prescription drug coverage for Medicare beneficiaries. We are considering a variety of
proposals to address the lack of coverage for prescription drugs in Medicare, including a
means-tested Medicaid option, an approach that would apply only in managed care, a traditional
benefit for all beneficiaries, and an unsubsidized purchasing mechanism that uses Medicare's size
as leverage for drug discounts for beneficiaries. If desirable, a proposal could be included in the
budget or coordinated with the March release of the Medicare Commission's recommendations. The
cost varies significantly depending on the proposal, ranging from $1 to 20 billion a year.
(DPC/NEC)
10. Disease Initiatives. We are working on several initiatives designed to combat particular
diseases. These initiatives, which you could choose to do individually or in combination, are: (1)
an asthma initiative, which will curb recent steep increases in asthma cases especially among young
children, by disseminating new treatment guidelines to state and local public health programs and
encouraging them to work with schools, child care organizations, businesses, and other community
organizations; (2) a mental illness initiative that will accompany a Surgeon General's report on this
subject (and perhaps a White House Conference recommended by Mrs. Gore) and will include
public-private partnerships to improve access to prevention and treatment, reforms in federal health
programs to improve delivery of mental health services, and funding increases in the mental health
block grant; and (3) a heart disease initiative, which could include: a new partnership with aging
networks to evaluate and improve nutrition; efforts to measure successful prevention approaches and
replicate them nationwide; and the creation of a network of educators, churches, and community-
based organizations to launch a nationwide awareness campaign. In each of these initiatives, the
public health efforts described above would supplement NIH funding of research projects. The
estimated cost of these initiatives is $50 million for asthma, $100 million for mental illness, and $20
million for heart disease. (DPC)
11. Food Safety. We are working on a food safety initiative that will highlight safety standards and
enforcement. Included in this initiative are: (1) a repackaged and somewhat modified legislative
proposal giving the FDA and USDA additional enforcement powers (e.g., mandatory recalls and
civil penalties); (2) additional food-specific regulations and/or guidelines (e.g., for certain fruits and
vegetables); and (3) more extensive adoption of our model codes for restaurants and food service
workers. In addition, we will focus on improving coordination with state and local agencies that
regulate food safety in order to develop a wholly integrated national inspection system. (DPC)
TOBACCO (DPC)
1. State Menu. Our best vehicle for enacting tobacco legislation next year will be a legislative
waiver of federal Medicaid claims to the states' expected $200 billion settlement with the tobacco
companies. We will seek bipartisan agreement on a menu of uses for the federal share of state
8
money, with tobacco control and child care as our top priorities. We will try to use this measure as
a vehicle for other key elements of our tobacco policy, such as FDA jurisdiction and warning labels.
2. Price Increase. One of the most difficult budget decisions will be whether to assume a tobacco
tax increase in our budget request, and if so, what to do with the money. There are strong arguments
on each side of the question whether to include a tobacco tax increase in our budget. If we do
assume tobacco revenue, the candidates for it include: (1) assistance to tobacco farmers (about $1
billion a year); (2) the long-term care tax credit (about $1 billion a year); (3) other tax cuts, such as
a child care / stay-at-home tax credit and/or a reduction in the marriage penalty; (4) NIH research;
(5) public health programs; and (6) the Medicare trust fund and/or a new prescription drug benefit
for Medicare beneficiaries.
FAMILIES AND CHILDREN (DPC/NEC as specified)
1. Expansion of the Child Care and Development Block Grant (old policy). We propose to
expand the Child Care and Development Block Grant as we did in the FY 1999 Budget. The block
grant is the primary federal child care subsidy program, helping low-income working families to pay
for child care. Currently, between one and two million children are served by the program, leaving
roughly nine million children who are eligible but unserved. This proposal would cost at least $7.5
billion over five years. (DPC)
2. Tax Relief for Parents, Including Parents who Stay at Home. We are considering replacing
our last year's proposal to expand the Child and Dependent Care Tax Credit with a new proposal to
benefit all parents, including those who stay home. This change will address the criticism that our
child care initiative did little for stay-at-home parents. We are reviewing proposals to (1) double the
child tax credit to $1,000 per child for all children under the age of four, at a cost of about $12 billion
over five years; (2) increase the standard deduction for each child under the age of three by $1,000,
at a cost of about $3 billion over five years; or (3) expand the Child and Dependent Care Tax Credit
as we did last year and extend its benefits to parents with children below age three by assuming
minimum child care expenses of $150 each month, at a total cost of about $21 billion over five years.
Each of these proposals can be dialed up or down by adjusting either the age threshold or the dollar
amount. (DPC/NEC)
3. Tax Credit for Businesses Providing Child Care. We could again propose to provide a tax
credit to businesses that provide child care services for their employees. The credit, which covers
25% of qualified costs but may not exceed $150,000 per year, costs $500 million over 5 years. To
further build on this concept, we also propose to provide tax credits to businesses that provide on-site
schools (see education section). (DPC/NEC)
4. Parent Paid Leave Plan. Many workers cannot afford to take unpaid leave following the birth
or adoption of a child, even though they have access to an unpaid leave policy through FMLA or
voluntary employer benefit plans. To address this problem, we are considering a proposal to provide
eligible parents who already have access to unpaid leave with partial wage replacement for a set
9
period of time. The cost of the program, which would be administered through the Unemployment
Insurance System, varies according to the selected eligibility criteria. If we choose, for example, to
give $200 per week for four weeks to new parents with median income (about $37,000) or below,
the cost will be about $875 million for FY 2000 (including start-up and administrative expenses).
(DPC)
5. FMLA Expansion to Businesses with 25 Workers (old but unarticulated policy). Under
current law, workers are eligible for FMLA coverage only if they work at a business with 50 or more
employees and if they have worked at least twelve months and 1,250 hours for the employer. In
your last State of the Union, you called for covering more workers under the FMLA, but did not
fully articulate how you would do so. We could now advance a specific proposal to lower the
FMLA threshold to 25 or more workers, which would expand coverage for up to ten million more
American workers. (DPC/NEC)
6. Parent Education and Support Fund. We are considering proposals to create a competitive
grant program administered by HHS to fund parent education and support programs, including home
visitation programs and "second chance maternity homes" to support teen mothers and teach
parenting skills. This fund could cost about $500 million over five years. (DPC)
7. Adoption Registry. We are working on plans to create an Internet-based adoption registry of
foster care children waiting to be adopted, so that prospective adoptive parents can learn about these
waiting children. Funding this registry would require very smally increase in HHS's Adoption
Opportunities Grant Program. (DPC)
COMMUNITY EMPOWERMENT (DPC/NEC for all)
1. CDFI Tax Credit. We are looking at a proposal to extend tax incentives to encourage
investment in CDFIs, which would leverage additional private investment in distressed areas and
stimulate the economic revitalization of those areas. Under the proposal, $100 million in non-
refundable tax credits would be made available to the CDFI Fund to allocate among equity investors
in qualified CDFIs using a competitive process.
2. Microcredit Initiative. We are working to identify means to increase support for
microenterprise finance, both domestically and internationally. We are examining whether to build
on Senators Kennedy's and Domenici's PRIME legislation which would provide technical assistance
to microenterprise. We are also looking at increased funding for CDFI initiatives specifically
targeted to microenterprise, and CRA and other regulatory reform designed to enhance bank lending
to microenterprise funds. On the international side, we are looking at whether we can increase
microenterprise funding through USAID or MDBs, especially to countries hardest hit by the
financial crisis.
3. Clean Water, Parks, and Communities Bonds. We are examining three proposals to
encourage "green" infrastructure projects. The first model uses the same financing mechanism as
10
your school construction proposal for a menu of projects: protecting and improving water quality;
cleanup of contaminated sediments; waterfront reclamation and revitalization; stormwater runoff
control; purchasing of green spaces to prevent sprawl; park enhancements and revitalization, and
brownfields cleanup. The second model, which provides a smaller incentive than the first model,
would create new tax-exempt bond authority for these state and local areas to invest in clean water,
parks, and communities. The advantage of this model is that it builds on the current system of bond
finance. The final model would allocate tax credits (like the Low-Income Housing Tax Credit) to
states and local areas to provide to the developers of these green infrastructure projects.
4. Employment Tax Credits. The Work Opportunity Tax Credit and the Welfare-To-Work Tax
Credit encourage employers to hire and retain members of certain economically disadvantaged
targeted groups. Both credits will expire on June 30, 1999. Under this proposal the two credits
would be made permanent.
5. Re-Develop 10,000 Abandoned Buildings. Abandoned buildings are a symbol of urban blight,
and an action plan to turn this around will be a powerful signal of change. We are examining
different proposals to help re-develop 10,000 abandoned buildings, combining several existing
programs or providing grants or tax incentives to spur private-sector redevelopment of these sites.
6. Low-Income Housing Tax Credit and Regional Affordable Housing Initiative. Last year,
you proposed a 40-percent expansion of the Low-Income Housing Tax Credit to spur the private
sector to develop more affordable rental housing for low-income Americans. We recommend that
you again ask Congress to take this action, which would restore the value of the credit to its 1986
level and help develop an additional 150,000-180,000 affordable housing units over the next five
years. This proposal would cost $1.6 billion over five years. At the same time, you could propose
a Regional Affordable Housing Initiative to increase the availability of affordable housing in areas
with high growth in low-skilled jobs and inadequate supplies of housing for low-income workers.
This proposal could be funded through HUD's HOME program and would cost $125 million over
five years.
7.
Homeownership Tax Credit. We are examining two kinds of tax credits to promote
homeownership among lower-income families, who generally do not benefit from the mortgage
interest deduction. The first proposal would use the model of the Low-Income Housing Tax Credit
to create a Low-Income Homeownership Tax Credit. Under this proposal, low-income families
would receive a low- or zero-interest second mortgage, which would reduce their upfront costs (e.g.,
downpayment and closing costs) and investors would receive tax credits in return. The second
proposal is a $5,000 tax credit for first-time homebuyers in Empowerment Zones or Enterprise
Communities.
8. Housing for the Elderly Initiative. This proposal is designed to improve housing for elderly
people and thereby provide an alternative to nursing home care. In addition to providing capital to
improve and modify such housing to meet the needs of elderly residents, the initiative would provide
housing vouchers for low income elderly who live in housing developed through the Low-Income
11
Housing Tax Credit. Because the tax credit helps subsidize rent, this proposal would allow us to
leverage our resources and provide more vouchers to the poor elderly.
9. Incremental Tenant-based Section 8 Vouchers. To build on our success in this past year's
budget, we recommend seeking an additional 50,000 welfare-to-work housing vouchers and another
25,000 vouchers to meet the needs of the homeless, including elderly homeless and homeless
veterans.
10. Homelessness. We are working on a three-part proposal that would: (1) assist the
approximately 250,000 homeless veterans by increasing residential alternatives, community-based
contracted care, job preparation activities, stand down activities (community-sponsored events that
conduct one-stop service delivery programs for homeless veterans), the distribution of clothing, and
long-term housing; (2) allow VA to sell surplus property with 10 percent of proceeds going to
homeless veterans; and (3) start a demonstration project targeted to the chronically homeless to test
the most promising models for moving the chronically homeless to self-sufficiency using a
combination of permanent housing and links to mainstream services. Cost: $105 million -- $60
million for VA and $45 million for HUD demonstration project.
RURAL/AGRICULTURE (NEC/DPC as specified)
1. Strengthening the Safety Net. To help farmers suffering from the depressed export markets and
natural disasters, we are considering various reforms of the crop insurance program and closing gaps
in the emergency loan program. We are paying special attention to programs that will help small
family farms. (NEC)
2. Bringing the knowledge of land grant colleges to every rural American: The USDA spends
$1.6 billion on agricultural research, much of it at America's land grant colleges and universities.
The government could provide grants to ensure that this information is available on the Internet and
is well-organized --so that all rural Americans can easily access information on topics such as crops,
livestock, rural development, natural resource conservation, and food safety. (NEC)
3. Emergency Medical Services in Rural Areas. The presence of viable emergency systems is
critical for residents in rural areas, because of the high rates of injury associated with jobs in these
areas and the long distances to health providers. This proposal, costing about $50 million, would
provide funds to States and local communities to improve access to 911 services or alternative
emergency systems. It also would fund programs to help rural communities train local citizens in
CPR and first responder techniques and to recruit and retain emergency personnel. (DPC)
TECHNOLOGY (NEC)
1. Curbcuts on the Information Highway. We are looking at several options that would make
information technology usable by people with disabilities in a manner that improves their lives: (1)
investing in R&D (e.g., text-to-speech, automatic captioning, speech recognition); (2) giving
12
disabilities groups a seat at the table as the standards for new technologies are developed; and (3)
making the government a model "user" of accessible technology. In addition, the tax credit for
work-related impairment expenses for people with disabilities could be used to expand the market
for assistive technology.
2. A Digital Library for Science, Math and Engineering. We need to get every young student
and undergraduate excited about math, science and engineering. One approach we are exploring is
creating a "digital library," which would contain lectures from Nobel Prize laureates, have an ability
to track and replicate cutting-edge scientific experiments, and make it easier for students and
teachers to locate the best instructional material on the Internet.
3. A User-Friendly Information Age Government. American citizens should not have to learn
the "org chart" of the federal government. Building on the efforts of the Vice President's
"reinventing government" activities, the Administration will be developing a series of "one stop
shops" that tie together the most useful information and on-line transactions for students, senior
citizens, exporters, and small businesses.
4. Information Technology Research Initiative. Increasing our investment in information
technology research, which is currently about $1 billion of the federal research budget, could lead
to the following breakthroughs: supercomputers that can more rapidly perform important functions,
such as designing life-saving drugs and predicting severe weather systems; wireless networks that
can bring telemedicine and distance learning to rural America; a device of the size of a paper that
could monitor the vital signs of a senior citizen, send a "911" message in the event of a medical
emergency, and provide an exact location using global positioning technology; new software tools
that can help us cope with "information overload" by discovering patterns in huge quantities of data;
and intelligent spacecraft that can explore the Solar System. Options have been developed at
roughly $100, $200 and $400 million in FY2000; and $1, $2 and $3 billion over 5 years.
5. 21st Century Research Fund. One initiative that you announced in last year's budget that we
think is important to continue is the 21 st Century Research Fund -- which provided across-the-board
support for civilian R&D at agencies such as NIH, NSF, and Energy. This year, Congress provided
a 10 percent increase for basic research, so this is an area where bipartisan cooperation is possible.
CRIME (DPC)
1. Crime Bill II. The 1994 Crime Act will expire at the end of the FY 2000 budget cycle,
guaranteeing that the next Congress will consider major crime legislation. We recommend that you
get a jump on this debate by using your State of the Union and FY 2000 budget to challenge
Congress to pass a new crime bill that builds on the core elements of the successful 1994 Act -- more
police, smarter punishment, and more prevention. Most of the money required is already built into
future budgets; continuation of the COPS program, however, will require new funds totaling about
$1 billion. We believe that a new Crime Act should include the following elements:
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Community-Oriented Policing and Prosecution Services (COPPS). Your pledge to help
fund 100,000 more police is likely to be fulfilled before the end of next summer. A new
COPPS initiative (note the extra "P" for "Prosecution"), costing about $1.4 billion in the first
year, could include funds to: (1) hire, redeploy, and retain an estimated 7,500 more police
each year; (2) provide modern technology and equipment and support training in modern
policing techniques, with a special emphasis on "hot spots" technology; (3) hire, train, and
equip prosecutors to join local police in fighting crime on a more community-based, pro-
active basis; and (4) support partnerships between law enforcement and community-based
groups to prevent crime in their areas.
A new focus on probation supervision and coerced abstinence. The punishment title of
the crime bill now focuses largely on prison construction; we recommend shifting the focus
to a new "Certainty of Punishment" initiative that will support the expanded use of probation
supervision and of drug testing and treatment.
Gun initiatives. A new crime bill should include your longstanding firearms priorities --
juvenile Brady, Brady II, federal CAP legislation and child safety locks. It also could
include new proposals to: (1) close the loophole that exempts many firearms sales at gun
shows and flea markets from Brady background checks; (2) expand the Youth Crime Gun
Interdiction Initiative (YCGII) -- to trace all crime guns and investigate gun traffickers -- to
an additional 20-40 cities; and (3) assemble gun strike forces -- teams of federal prosecutors
and ATF agents, acting with local law enforcement -- to target cities with high levels of gun
violence and crack down on gun traffickers.
Values-based crime prevention initiative. In addition to other crime bill prevention
programs, we could invest in promoting values-based crime and violence prevention efforts,
such as those of Rev. Eugene Rivers. Funds from this program would go to comprehensive
prevention programs run by faith-based and other institutions seking to instill and reinforce
common sense values in troubled youth.
2. Safe, Disciplined, and Drug-Free Schools. At the White House Conference on School Safety,
you announced that you would overhaul and strengthen the Safe and Drug-Free Schools Program.
Under this proposed reform, funds will be appropriately targeted to schools with serious drug and
crime problems, and schools will have to adopt rigorous, comprehensive school safety plans that
include: tough but fair discipline policies, such as zero tolerance for guns and drugs; safe passage
to and from schools; effective drug and violence policies and programs; annual school safety and
drug use report cards; links to after school programs; efforts to involve parents; and crisis
management plans. We also could include in this package (1) funds for states that adopt a policy
of drug testing first-time applicants for drivers' licenses and (2) funds for school districts that adopt
a policy of drug testing middle and high school students with parental consent. We believe that these
reforms will require up to $450 million in new funding in FY 2000.
3. Parity for Substance Abuse Treatment. Appropriate substance abuse treatment remains
14
unavailable to nearly half of the people who need it. To help fill this treatment gap, we could
propose legislation to encourage parity between substance abuse treatment and other medical
benefits. Similar to the Mental Health Parity Act signed into law in 1996, a current draft of this
legislation would prohibit health care plans that provide a substance abuse benefit from setting
annual or lifetime dollar limits on this benefit at a lower level than those for other medical and
surgical benefits. At the same time, we would have to ensure that federal health programs provide
parity between substance abuse treatment and other medical benefits; we are still exploring the cost
of any necessary reforms to these programs.
4. Binge Drinking. We are working on a number of proposals regarding alcohol abuse, including
(1) promoting a voluntary code for alcohol advertisements directed toward minors; (2) banning
alcohol billboards near schools; (3) discouraging alcohol advertising on youth-oriented web sites;
(4) and funding educational efforts about the dangers of alcohol consumption.
WELFARE REFORM, CHILD SUPPORT ENFORCEMENT, AND CHILD WELFARE (DPC)
1. Reauthorize the Welfare-to-Work Program. Congress authorized the Welfare-to-Work
Program for only two years; if we wish to continue our current investment in the hardest-to-employ,
we will have to propose a reauthorization of about $1.5 billion annually. Within this funding level,
we propose several set-asides, totaling $500 million, for the following specific purposes: (1) work-
based English-language literacy projects for immigrants and others; (2) work-based substance abuse
testing and treatment programs; (3) employment services for welfare recipients with disabilities; and
(4) a work-based program to promote responsible fatherhood, including efforts to increase low-
income fathers' employment and earnings and ensure that they provide financial and other support
to their children.
2. Child Support. One initiative, costing just a few million dollars each year, would increase the
prosecution of egregious child support violators by establishing multi-agency teams, working with
state and local law enforcement, to identify, analyze, and investigate cases for prosecution. A pilot
project of this kind is already under way in five states; this proposal would put these units in place
all across the nation within the next several years. A second initiative would seek legislation to
exclude doctors and other health care providers who are delinquent in child support from the
Medicare program or from programs offering health professional loans.
3. Children "Aging Out" of Foster Care. Each year, nearly 20,000 18-year-olds "age out" of the
public child welfare system. Federal financial support for these young people ends just at the time
they are making the critical transition to adulthood. Areas for increased investment for these young
adults include: (1) expanding the independent living program, which provides services to foster care
children in this age group; (2) expanding the transitional living program, a competitive grant
program that funds community-based organizations that provide services to this population,
including housing support; and (3) giving states the option of using Federal Medicaid dollars to
provide health care coverage for this population. (Cost: roughly $150 million each year)
15
Welfare-to-Work Housing Vouchers and Tax Credit -- see COMMUNITY EMPOWERMENT
Section
CIVIL RIGHTS AND WOMEN'S RIGHTS (DPC)
1. Equal Pay. We are working on a program to be run by the EEOC and DOL to increase outreach
to businesses and employees about equal pay requirements, provide technical assistance to
businesses seeking to comply, improve training for EEOC employees, and expand enforcement
capabilities. In addition, the program will fund research on the nature and extent of wage
discrimination, as well as a new Women in Non-Traditional Occupations Initiative designed to
improve access of women into occupations such as construction and high technology. Cost: about
$20 million for EEOC and $10 million for DOL.
2. Abortion Violence. We are working on a comprehensive initiative to address violence against
providers of reproductive health services. This initiative may include: (1) a National Task Force
established by the Department of Justice that will conduct investigations of abortion violence, collect
and collate information related to clinic violence, and provide training to federal, state, and local law
enforcement personnel on how to address this problem; (2) special security measures, including
stepped-up U.S. Marshal support, at clinics identified to be at risk of violence; and (3) federal
guarantees of loans taken out by clinics that must rebuild after they have been attacked. Cost:
Unknown at this time.
TRANSPORTATION (NEC/DPC as specified)
1. Reauthorization of the FAA, with Focus on Modernization and Competition. A blue-ribbon
panel concluded last year that the air transportation system faces "gridlock" within a decade without
sweeping changes. We are considering various policy options to incorporate into the FAA
reauthorization that you will likely propose in 1999 that will: (1) improve the efficiency and capacity
of the nation's aviation system, and (2) enhance competition and service to rural areas. Some of the
components of this initiative would include: centralizing the air traffic control services (ATS) in a
performance-based organization; financing ATS for commercial aviation through cost-based user
fees; increasing Passenger Facility Charges (PFCs) to finance airport expansion nationwide;
modifying federal rules on how airports can use PFCs and other funds to encourage new airline
entrants; and enhancing service to underserved areas.
We are also looking at ways to further competition in international aviation. The Administration has
extended the benefits of competition by negotiating dozens of bilateral open-skies agreements. We
could press our trading partners for World Wide Open Skies and explore lifting other restrictions on
foreign aviation investment and operation on a reciprocal basis. (NEC)
2. Auto Safety. We are making headway on auto safety. Last year, the number and rate of auto
fatalities declined. However, we still have a long way to go -- more than 40,000 Americans die in
auto accidents each year, at a direct cost of $150 billion. The keys are seatbelts (more) and alcohol
16
(less). We are working on a comprehensive initiative that would include: (1) meeting the President's
goal of 85 percent seatbelt compliance by the year 2000, which would save 4,000 lives and nearly
$7 billion; (2) promoting education initiatives like the Buckle-Up America campaign; (3) enforcing
the TEA-21 requirement that states lower the legal blood alcohol content level from .10 to .08; and
(4) pushing a new Administration initiative on children's safety that will target auto accidents, among
other problems, by promoting the use of child safety seats, booster seats (for children ages 4-8), and
bicycle helmets. (NEC/DPC)
3. Transportation Needs of the Aged. With the number of Americans over 65 expected to grow
by half by 2020, we should begin addressing the need to ensure their continued mobility,
independence and safety in their later years. We are only beginning to look at this issue with DOT,
which plans to hold six town meetings soon with senior citizens, medical experts, transportation
safety specialists, and others to discuss the problems and challenges and identify best practices. The
U.S. will host an international conference on this topic next year, in connection with the United
Nation's Year of Older Persons. This may be combined with the long-term care and the housing for
the elderly initiatives. (NEC)
4. Sustainable Development and "Smart Growth." Sensible, flexible transportation initiatives
can improve both our economy and our quality of life. First, we will continue investing in
sustainable transportation. TEA-21 authorizes a record $41 billion over the next six years for transit;
increases tax-free transit benefits; and expands communities' ability to transfer funds from highway
construction to transit, bicycle and pedestrian programs, telecommuting and other forms of
transportation that reduce congestion and pollution. Second, we need to empower communities to
make smart choices, choosing the right transportation investments for their needs. As result of a new
policy DOT announced in April, communities can now use federal funds to clean and reuse
"brownfields," preserving farms and forests for the future. Third, we need to make communities
more livable, with support for low-cost projects with big quality-of-life benefits, such as bicycle
paths and historic preservation. (NEC)
ENERGY (NEC)
1. Proposing the Comprehensive Electricity Competition Act. You could call on Congress to
enact the electricity restructuring legislation Act, to make the electricity industry more competitive
and to provide more choices for industrial, commercial and residential customers. The
Administration's Comprehensive Electricity Competition Act will save consumers $20 billion a
year. Retail competition will not only improve efficiency, but also reduce the two-thirds waste of
energy currently associated with fossil-fuel generation of electricity, thereby cutting greenhouse gas
emissions.
2. Distributed Generation ("Micropower"). To increase the consumer savings and environmental
benefits from electricity competition, the Administration will pursue legislation to eliminate
obstacles to the use of small, clean efficient generation technologies (e.g., fuel cells and
photovoltaics) that can be installed at or near the electricity user's site. Moving from large, central-
17
station generation of electricity to distributed generation by small, clean sources is analogous to the
move from mainframe computers to personal computers.
PENSIONS (NEC)
1. Expanded Private Pension Plan Coverage: Last year, you announced several initiatives to
expand pension plan coverage which were not enacted, but which we continue to believe are
important and have substantial support on the Hill. We should again call for legislation that:
authorizes a simplified plan for small businesses that combines the best features of a defined benefit
and defined contribution plan (SMART), costing $313 million over five years; provides a three-year
tax credit to encourage small businesses to set up retirement programs, costing $508 million over
five years; and authorizes payroll deductions for IRAs. We are exploring ways to expand coverage
for moderate and lower-income workers. Consideration is also being given to ways of enabling
multiple small businesses to pool together for pension plan administration.
2. Women's Retirement Security: To underscore the importance of pensions for women's
retirement security, you would call for legislation enacting the two initiatives you announced in late
October -- namely, that time taken under FMLA should count toward retirement plan vesting
requirements and mandating that employer plans offer an option that pays less while the retired
employee is living but pays a survivor benefit equal to at least 75 percent of the benefit the couple
received while both were alive.
3. Pension Portability: You could renew your call for reducing vesting requirements from five years
to three years for employer matching contributions to 401(k) and other plans to reflect an increasingly
mobile workforce, and more workers moving in and out of the workforce over a lifetime. We are also
exploring various options that would increase pension portability and facilitate the movement of
retirement savings between plans, where this can be done without encouraging "leakage" or loss of
worker protections -- e.g., providing that federal employees can roll over retirement savings from
private sector qualified plans into the federal Thrift Savings Plan.
4. Expand Pension Right to Know Provisions: You could call for a pension right to know package
that provides for both workers and their spouses general information relating to retirement needs and
their benefits under employer retirement plans. In addition, an employee's spouse should have the
same rights to get information as the employee, before waiving the statutorily provided survivor
protection. You should call for a Pension Right to Know package that provides information for both
workers and their spouses. We are also working on an employee education program that would
provide employees with the tools they need to work with their employers to provide pension plans,
and are thinking about how to encourage courses in high schools on the importance of savings and
other general investment education (which can be combined with the Consumer Literacy and
Education campaign described below). Consideration is also being given to a savings stamp book
program in the schools (sell savings stamps in very small amounts; when the book is full, turn it in
for a U.S. savings bond) to help educate the young about how to reach savings goals.
18
5. Increase Retirement Security: To promote security, we are continuing to work on the pension
audit bill, changes to the multi employer (collectively bargained) plan rules, and expansion of
PBGC's missing participant program.
FINANCIAL SERVICES (NEC/DPC as specified)
1. Consumer Financial Literacy and Education. We are currently developing a set of proposals
to promote consumer financial awareness and enhance consumer credit literacy, ranging from a
public awareness campaign to establishing an educational clearinghouse to disseminate quality
curricula to high school students. We are also working on a study to identify what the biggest
problems are with how Americans use consumer credit, and what basic banking services and steps
they can take to help themselves (this may be very important if bankruptcy reform is a live item next
year). Part of our focus is on reaching out to low-income households, building on (and expanding)
two existing government programs -- Treasury's Electronic Funds Transfer program that was a first
step in helping the "unbanked" enter into electronic commerce and a USDA extension program that
is providing some (limited) services to rural low-income families. This proposal would cost $5-10
million. (NEC)
2. Consumer Financial Bill of Rights. In order to respond to the outrage consumers feel about
ATM surcharges, without supporting economically questionable regulation of ATM fees, we are
considering a proposal either for the government or for financial institutions voluntarily to make
publicly available a list of basic banking services and fees on an individual or geographic basis to
be published periodically over the Internet. The services profiled would include, but would not be
limited to, charges for access to ATMs. We are also considering the adequacy of current credit card
disclosure requirements (again, relevant to bankruptcy reform) and other areas where information
about financial service arrangements would be helpful to consumers. This would cost $3-5 million.
(NEC/DPC)
PROPOSED IDEAS FOR THE 1999 STATE OF THE UNION
Education and Training
Education
Expand the Education Research Initiative to provide all citizens the math and science
Research Initiative
skills they need for full participation in an increasingly "knowledge-based" social and
(OSTP)
economic system.
Fund an enhanced research effort to help determine the most effective methods for
teaching and learning.
Math and Science
Ensure sufficient numbers of teachers trained and retained in math and science teaching
Teachers Initiative
through enhanced teacher training and partnerships between school boards and local
(OSTP)
industries.
Ending Social
Expand after-school programs from $200M to $700M; target this money to districts that
Promotion
end social promotion.
(DPC/NEC)
Teacher Quality
Recruit 60,000 new teachers at high-need schools over the next 5 years ($100M
and Recruitment:
increase in the teacher recruitment scholarships enacted this year in the Higher
5-Part Strategy
Education Act).
(DPC/NEC)
Assist states to expand alternative certification routes and attract talented people from
other professions ($60M).
Crack down on teacher education schools.
Send secondary school teachers who teach outside their field back to college to take
additional courses in the subjects they're teaching, and require that new secondary
teachers pass competency tests in a subject before they can teach it ($50M increase in
the Eisenhower program).
Assist states in maximizing the 15% set-aside for teacher quality in the class size
legislation (approx. $210M above FY99 budget).
Encourage private school teachers to teach in public schools by providing vouchers.
Work-Site Schools
Create public schools at work sites ($100M increase in an existing discretionary
(DPC/NEC)
program to provide grants to 100 communities to launch work-site schools OR seek a
stand-alone bill).
Currently working with Treasury to develop a tax credit for businesses that start
on-site schools.
Public School
Support 3,000 charter schools by 2002 ($20M increase to $120M).
Choice
Increase funding for interdistrict magnet programs ($25M) and university-based
(DPC/NEC)
magnet schools ($15M).
School Leadership
Create school leadership academies that provide training in management, teacher
Academies
evaluation, school discipline, and other areas to elementary school principals in
(DPC/NEC)
high-poverty districts ($50M).
Class Size
Reach 100,000 new teachers in seven years ($1.3B in FY2000).
(DPC/NEC)
Press Congress to restore the local matching requirement and strengthen the provisions
to require competency testing of new teachers.
School
Repeat this year's proposal for tax credits to build and renovate schools covering the
Modernization
interest on nearly $22B in bonds.
(DPC/NEC)
Compare current proposal against other alternatives.
1
Partnership for a
Encourage employers to provide adult basic education classes at the worksite by
Literate America
providing a new tax credit and/or federal grants, and set aside funds for work-based
(DPC/NEC)
literacy projects within Welfare to Work competitive grants.
Expand the infrastructure and funding for adult basic education, encourage the
development of ESL and civic classes, and launch a national literacy information
campaign.
Use the new Learning Anytime Anywhere Partnerships to create software for adult
basic education using $200 computers and subsidizing public housing developments
that create computer literacy programs.
National
Launch a national information campaign about college costs and financial aid.
Campaign to Open
Build on GEAR UP to enable every middle school to give students a "21st Century
Doors of College
Scholar Certificate," indicating the financial aid for which they are eligible.
(DPC/NEC)
Seek to provide every high-poverty middle school with a college partner.
Improving the
Increase degree attainment among low-income and minority students by:
College Success
A super-Pell grant for the lowest income families and to encourage a full-time focus
Rate
on school in the first year of college.
(DPC/NEC)
Expanding successful mentoring and other support services in colleges.
Promoting college course-taking while in high school.
Encouraging partnerships between predominately minority-serving and predominately
majority-serving institutions of higher education.
Establishing a bridge fellowship program for graduate study in science and technology
fields for minorities and women.
Further Expanding
Add another 900 JROTC units over the next few years, to reach the authorized maximum
Junior ROTC
of 3500 ($235M).
(DPC/NEC)
Training American
Challenge the private sector to make good on their promise made during the H1-B
Workers for
debate to train more American workers.
Current and Future
Foster partnerships between industry and train providers to train both employed and
Skills Gaps
unemployed workers.
(DPC/NEC)
Provide competitive grants to encourage companies to develop programs in which
they subsidize the training of individuals who they then commit to hire.
Extend and expand some of the current training tax provisions.
Launch an informational/media campaign by the Departments of Education and Labor
to inform all Americans about available training opportunities, financial aid, and job
search assistance.
Develop the adult literacy and the "Improving the College Success Rate" initiatives.
Making Job
Seek a significant increase in dislocated worker funding so as to provide training to
Training Universal
every dislocated worker who wants or needs it within five years ($190M).
(DPC/NEC)
Ensure that job search assistance is available for every unemployed person.
Make available to every worker access to a One-Stop Career Center.
2
Service
AmeriCorps
Create a senior corps of 10,000 AmeriCorps volunteers to serve as tutors and mentors in
Seniors
after-school programs ($25M).
(DPC/NEC)
Expand
Expand the AmeriCorps program from its current level of 50,000 members per year to
AmeriCorps
approximately 70,000 per year, with the goal of reaching 100,000 per year by the end of
(DPC/NEC)
the Administration ($75M).
Work-Study
Increase from 7% to 25% over the next 3 years the required percentage of work-study
Program
money for students employed in community service.
(DPC/NEC)
Health Care
Long-Term Care
Develop a package program with the following components:
Initiative
A tax credit of up to $1,000 for people with 3 or more limitations in activities of daily
(DPC/NEC)
living or their caregivers ($6B/5 years).
A plan for OPM to offer federal employees a choice of high-quality private long-term
care insurance policies at lower-than-market prices.
A family caregiver support program providing grants to states for one-stop shops to
assist families who care for severely impaired elderly relatives $500-$750M/5 years).
A nursing home quality initiative that would include new enforcement provisions, new
funds for surveys of repeat offenders, and improved surveyor training; also, perhaps a
commission to oversee HCFA's nursing home enforcement efforts and to investigate
other kinds of facilities where health care is offered ($500-$750M/5 years).
Disability
Develop a health-related disabilities package which could include: (1) The
Proposals
Jeffords-Kennedy Work Incentives Improvement Act, enabling people with disabilities
(DPC/NEC)
to go back to work by giving them an option to buy into Medicaid and Medicare
($1.2B/5 years); (2) Promoting the deinstitutionalization of Medicaid beneficiaries by
developing viable community-based care alternatives for people residing in nursing
homes after a "date certain" ($50M/5 years); and (3) Making Medigap supplemental
insurance more accessible to people with disabilities.
Consider an alternative package which could include: (1) A tax credit of $1,000 to
$5,000 for working people with disabilities to assist them in paying for the costs
associated with employment ($1B-$2B/5 years); (2) A new competitive grant program
to increase the employment rate of adults with disabilities; and (3) Efforts to ensure
that new technologies are designed so as to be accessible to people with disabilities.
Health Insurance
Encourage small businesses to form purchasing cooperatives for health insurance
Coverage
($50-$100M/5 years).
Expansions
Improve outreach for children's health insurance.
(DPC/NEC)
Provide a Medicare buy-in for certain people ages 55-65, benefiting about 30,000
people ($500M/5 years).
HMO Withdrawals
Develop legislation, as promised by POTUS, to prevent HMOs from pulling out of
From Medicare
Medicare with only a few month's notice.
(DPC/NEC)
Biomedical
Propose (again) an increased investment in biomedical research ($500M-$1B--depending
Research
on how tobacco money is treated in the budget).
(DPC/NEC)
3
Antibiotics (Super
Launch a major outreach, education, and research campaign to understand where and why
Bug) Initiative
antibiotic resistance occurs and to develop an effective response ($25M/year).
(DPC/NEC)
Bioterrorism
Develop a $100-$300M/year bioterrorism initiative to:
Initiative
Train epidemic intelligence officers who can coordinate with state health departments
(DPC/NEC)
to identify and respond to attacks.
Develop a mass casualty emergency response system that includes primary care,
emergency transportation, and decontamination abilities.
Create and maintain a stockpile of pharmaceuticals.
Develop new vaccines and antibiotics to be used in the event of attack.
Medicare's
Develop a range of proposals ($500M/5 years) to:
Premium
Use Social Security Offices to educate low-income Medicare beneficiaries of their
Assistance
eligibility to receive Medicaid coverage of their Medicare premiums and cost sharing.
Program
Reduce administrative complexity for states.
(DPC/NEC)
Give states incentives to engage in more aggressive outreach efforts.
Prescription Drug
Consider a variety of proposals to address the lack of coverage for prescription drugs in
Coverage for
Medicare ($1-$20B/year) including:
Medicare
A means-tested Medicaid option.
Beneficiaries
A traditional benefit for all beneficiaries.
(DPC/NEC)
An unsubsidized purchasing mechanism that uses Medicare's size as leverage for drug
discounts for beneficiaries.
Disease Initiatives
Curb recent steep increases in asthma cases by disseminating new treatment
(DPC/NEC)
guidelines to state and local public health programs and encouraging them to work
with schools, child care organizations, businesses, and other community organizations
($50M).
Launch a mental health initiative to accompany the Surgeon General's report on this
subject (and possibly a White House Conference recommended by Mrs. Gore) which
will include public-private partnerships to improve access to prevention and treatment,
reforms in federal health programs to improve delivery of mental health services, and
funding increases in the mental health block grant ($100M).
Develop a heart disease initiative ($20M).
Declaring War on
Launch a national campaign to halt the dramatic increase in asthma and, ultimately, reduce
Asthma (CEQ)
by half the number of children who die from the disease or suffer severe symptoms
($55M).
Food Safety
An initiative that will include:
(DPC/NEC)
A legislative proposal giving the FDA and USDA additional enforcement powers.
Additional food-specific regulations or guidelines.
More extensive adoption of the model codes for restaurants and food service workers.
An integrated national inspection system of state and local agencies that regulate food
safety.
4
Tobacco
State Menu
Enact a legislative waiver of federal Medicaid claims to the states' expected $200B
(DPC/NEC)
settlement with the tobacco companies.
Seek bipartisan agreement on a menu of uses for the federal share of state money, with
tobacco control and child care as the top priorities.
Attempt to use this measure as a vehicle for other key elements of tobacco policy, such
as FDA jurisdiction and warning labels.
Price Increase
If assuming tobacco revenue, candidates include:
(DPC/NEC)
Assistance to tobacco farmers ($1B/year).
Long-term care tax credit ($1B/year).
Other tax cuts, such as a child care/stay-at-home care tax credit and/or a reduction in
the marriage penalty.
NIH research.
Public health programs.
Medicare trust fund and a new prescription drug benefit for Medicare beneficiaries.
Families and Children
CDBG
Expand CDBG as in FY99 (at least $7.5B/5 years).
(DPC/NEC)
Tax Relief for
Consider replacing last year's proposal to expand the Child and Dependent Care Tax
Parents, Including
Credit with a new proposal to benefit all parents:
Parents Who Stay
Double the child tax credit to $1000/child for all children under four ($12B/5 years).
at Home
Increase the standard deduction for each child under 3 by $1,000 ($3B/5 years).
(DPC/NEC)
Expand the Child and Dependent Care Tax Credit and extend its benefits to parents
with children below age three by assuming minimum child care expenses of $150 each
month ($21B/5 years).
Tax Credits for
Propose (again) to provide a tax credit to businesses that provide child care services
Businesses With
for their employees ($500M/5 years).
Child Care
Provide tax credits to businesses that provide on-site schools (see education section).
(DPC/NEC)
Parent Paid Leave
Consider providing eligible parents who already have access to unpaid leave with partial
Plan
wage replacement for a set period of time (price varies according to the eligibility criteria).
(DPC/NEC)
FMLA Expansion
Expand coverage for up to 10M more American workers by lowering the FMLA threshold
to Businesses with
to 25 or more workers (an old but unarticulated policy).
25 Workers
(DPC/NEC)
Parent Education
Consider creating a competitive grant program administered by HHS to fund parent
and Support Fund
education and support programs, including home visitation programs and "second chance
(DPC/NEC)
maternity homes" to support teen mothers and teach parenting skills ($500M/5 years).
Adoption Registry
Create an Internet-based adoption registry of foster care children waiting to be adopted, so
(DPC/NEC)
that prospective adoptive parents can learn about these waiting children (a small increase
in HHS's Adoption Opportunity Grant Program).
5
Community Empowerment
CDFI Tax Credit
Extend tax incentives to encourage investment in CDFIs; leverage additional private
(DPC/NEC)
investment in distressed areas and stimulate the economic revitalization of those areas.
($100M in nonrefundable tax credits would be made available to the CDFI FUND to
allocate among equity investors in qualified CDFIs using a competitive process).
Microcredit
Identify means to increase support for microenterprise finance.
Initiative
Examine whether to build on Senators Kennedy's and Domenici's PRIME legislation
(DPC/NEC)
which would provide technical assistance to microenterprise.
Look at increased funding for CDFI initiatives specifically targeted to
microenterprise, and CRA and other regulatory reform designed to enhance bank
lending to microenterprise funds.
Determine whether to increase microenterprise funding through USAID or MDBs,
especially to countries hardest hit by the financial crisis.
Employment Tax
Make permanent the Work Opportunity and the Welfare-To-Work Tax Credits to
Credits
encourage employers to hire and retain members of certain economically disadvantaged
(DPC/NEC)
targeted groups (both credits will expire on June 30, 1999).
Abandoned
Help to re-develop 100,000 abandoned buildings.
Buildings
(DPC/NEC)
Low-Income
Recommend that POTUS again ask Congress for a 40% expansion of the
Housing Tax Credit
Low-Income Housing Tax Credit, which would restore the value of the credit to its
and Regional
1986 level and help develop an additional 150,000-180,000 affordable housing units
Affordable Housing
over the next five years ($1.6B/5 years).
Initiative
Launch a Regional Affordable Housing Initiative to increase the availability of
(DPC/NEC)
affordable housing in areas with high growth in low-skilled jobs and inadequate
supplies of housing for low-income workers ($125M/5 years and could be funded
through HUD's HOME program).
Homeownership
Use the Low-Income Housing Tax Credit model to create a Low-Income
Tax Credit
Homeownership Tax Credit whereby low-income families would receive a low-or
(DPC/NEC)
zero-interest second mortgage.
Provide a $4000 tax credit for first-time homebuyers in Empowerment Zones or
Enterprise Communities.
Housing for the
Provide housing vouchers for low income elderly who live in housing developed through
Elderly Initiative
the Low-Income Housing Tax Credit (in addition to providing capital to improve and
(DPC/NEC)
modify housing to meet the needs of elderly residents).
Tenant-based
Seek an additional 50,000 welfare-to-work housing vouchers and 25,000 vouchers to
Section 8 Vouchers
meet the needs of the homeless, including elderly homeless and homeless veterans.
(DPC/NEC)
Homelessness
A 3 part-proposal ($60M for VA and $45M for HUD demonstration project):
(DPC/NEC)
Assist the approximately 250,000 homeless veterans by increasing residential
alternatives, community-based contracted care, job preparation activities, stand down
activities, clothing distribution, and long-term housing.
Allow VA to sell surplus property with 10% of proceeds going to homeless veterans.
Identify promising models for moving the chronically homeless to self-sufficiency by
using a combination of permanent housing and links to mainstream services.
6
Environment
Clean Water, Parks,
Encourage "green" infrastructure projects (3 models):
and Communities
Use the same financing mechanism as the school construction proposal for a menu of
Bonds
projects including protecting and improving water quality; purchasing green spaces to
(NEC/DPC)
prevent sprawl; and cleaning up brownfields.
Create new tax-exempt bond authority for state and local areas to invest in clean
water, parks, and communities; build on the current system of bond finance.
Allocate tax credits (like the Low-Income Housing Tax Credit) to states and local
areas to provide to the developers of these green infrastructure projects.
Lands Legacy
Preserve natural and open spaces in each community, within reach of every citizen:
(CEQ)
Create a Partnership for America's Resources (Interior) by drawing on and
expanding several existing funds, including the Land and Water Conservation Fund,
and establishing new funding sources to generate a total of about $3B a year through
2009; these funds would support a wide range of acquisition and restoration programs
at the federal, state and local levels; OR
Launch a streamlined version of Interior's proposal that draws as well on other
agencies' resources and incorporates targeted tax incentives. Initiatives could
include northern forests, parks and communities, farmland preservation, Lewis and
Clark national preserve, conservation incentives, and habitat protection.
Clean Air Fund
Propose $1B in new funding to provide low-interest financing for projects that achieve
(CEQ/Special
early reductions in air pollution and greenhouse emissions, giving cities and states a
Projects)
nonregulatory tool in the fight for cleaner air; partners include EPA, DOE, and Treasury.
A New Partnership
Launch a new initiative to protect America's coasts and the Great Lakes.
for Lakes and
Propose new funding to help farmers combat water pollution.
Coasts (CEQ)
Call on Congress to reauthorize and strengthen the Clean Water Act.
Restore wetlands in Louisiana and other Gulf states ($300M/year); fund sediment
cleanup and natural resource restoration ($280M/year); and implement estuary
recovery plans developed with states and local communities ($100M/year).
Environment to
Commit $100M/year (with a portion from the Abandoned Mine Reclamation Fund) to:
Work (CEQ)
Train former welfare recipients and other workers for jobs in environmental cleanup
and energy efficiency.
Retrain timber workers, miners, and fishermen for environmental restoration work.
Preserving and
Commit an additional $6M in FY2000, $21M in FY2001, and $36M in FY2002 to:
Exploring Our
Designate a new national marine sanctuary.
Ocean Frontier
Double the number of marine sanctuaries over the next 10 years.
(CEQ)
Strengthen protections within existing and new sanctuaries.
Getting Energy
Move several major Energy Star products off the shelves and into consumers' homes:
Efficient Products
Launch a campaign to inform consumers about the financial/environmental benefits
Into Our Homes
of retiring older appliances and replacing them with energy efficient models (DOE).
(Special Projects)
Provide rebates from the manufacturers and electric utilities.
Offer federal financial incentives in the form of tax incentives or rebates.
Bioenergy --An
Launch a partnership with farmers, the forest products industry, power companies,
Alternative to Fossil
chemical companies, and others to develop a clean, biomass-based energy industry (DOE
Fuels
and USDA are already making substantial investments in bioenergy).
(Special Projects)
7
Rural/Agriculture
Strengthening the
Reform the crop insurance program and close gaps in the emergency loan program.
Safety Net
Launch programs that will help small family farms.
(DPC/NEC)
Make Accessible
Provide grants to ensure that the information held by land grant colleges re: agricultural
the Knowledge of
research is available on the Internet and is well organized so that all rural Americans can
Land Grant
easily access this information.
Colleges
(DPC/NEC)
Emergency Medical
Authorize $50M to:
Services in Rural
Improve access to 911 services or alternative emergency systems in rural areas.
Areas
Assist rural communities train local citizens in CPR and first responder techniques
(DPC/NEC)
and to recruit and retain emergency personnel.
Technology
Curbcuts on the
Make information technology usable by people with disabilities:
Information
Invest in R&D.
Highway
Give disabilities groups a seat at the table as the standards for new technologies are
(DPC/NEC)
developed.
Make the government a model "user" of accessible technology.
Use the tax credit for work-related impairment expenses for people with disabilities
to expand the market for assistive technology.
Information
Establish partnerships among school boards, community colleges, universities, and
Technology
corporate America to address the shortage of IT industry workers.
Workforce Initiative
(OSTP)
A Digital Library
Explore creating a "digital library" which would contain lectures from Nobel Prize
for Science, Math
laureates, have an ability to track and replicate cutting-edge scientific experiments, and
and Engineering
make it easier for students and teachers to locate the best instructional material on the
(DPC/NEC)
Internet.
A User-Friendly
Develop a series of "one-stop shops" that tie together the most useful information and
Information Age
on-line transactions for students, senior citizens, exporters, and small businesses.
Government
(DPC/NEC)
Space Station
Capitalize on Americans' interest in space exploration to build Congressional support.
(OSTP)
Information
Develop options at roughly $100, $200, and $400M in FY2000; and $1, $2, and $3B over
Technology
5 years.
Research Initiative
(DPC/NEC/OSTP)
21st Century
Continue the 21st Century Research Fund, which provided across-the-board support for
Research Fund
civilian R&D at agencies such as NIH, NSF, and Energy.
(DPC/NEC/OSTP)
8
Crime
Crime Bill II
Pass a new crime bill that builds on the core elements of the 1994 Act:
(DPC/NEC)
Community-Oriented Policing and Prosecution Services (COPPS). POTUS' pledge
to help fund 100,000 more police is likely to be fulfilled before the end of next
summer. A new COPPS initiative could include funds to: (1) Hire, redeploy, and
retain an estimated 7500 more police/year; (2) Provide modern technology and
equipment and support training in modern policing techniques, with a special
emphasis on "hot spots" technology; (3) Hire, train, and equip prosecutors to join
local police in fighting crime on a more community-based, proactive basis; and (4)
Support partnership between law enforcement and community-based groups to
prevent crime in their areas.
Shift the focus from prison construction to a new "certainty of punishment" that will
support the expanded use of probation supervision and of drug testing and treatment.
Include the longstanding firearms priorities--juvenile Brady, Brady II, federal CAP
legislation and child safety locks. Also include new proposals: (1) Close the loophole
that exempts many firearms sales at gun shows and flea markets from Brady
background checks; (2) Expand the Youth Crime Gun Interdiction Initiative (YCGII)
--to trace all crime guns and investigate gun traffickers - --to an additional 20-40 cities;
and (3) Assemble gun strike forces --teams of federal prosecutors and ATF agents,
acting with local enforcement--to target cities with high levels of gun violence and
crack down on gun traffickers.
Invest in promoting values-based crime and violence prevention efforts; support
comprehensive prevention programs run by faith-based and other institutions.
Safe, Disciplined,
POTUS announced he would overhaul and strengthen the Safe and Drug-Free School
and Drug-Free
Program (up to $450M in new FY2000 funding):
Schools
Target funds to schools with serious drug and crime problems.
(DPC/NEC)
Require that school adopt rigorous, comprehensive school safety plans.
Fund states that adopt a policy of drug testing first-time applicants for drivers'
licenses.
Fund school districts that adopt a policy of drug testing middle and high school
students with parental consent.
Parity for Substance
Propose legislation to encourage parity between substance abuse treatment and other
Abuse Treatment
medical benefits.
(DPC/NEC)
Ensure that federal health programs provide parity between substance abuse
treatment and other medical benefits.
Binge Drinking
Promote a voluntary code for alcohol advertisements directed toward minors.
(DPC/NEC)
Ban alcohol billboards near schools.
Discourage alcohol advertising on youth-oriented web sites.
Fund educational efforts about the dangers of alcohol consumption.
Energy
Comprehensive
Enact the Electricity Restructuring Legislation Act, to make the electricity industry more
Electricity
competitive and to provide more choices for industrial, commercial, and residential
Competition Act
customers.
(DPC/NEC)
"Micropower"
Pursue legislation to attain the use of small, clean efficient generation technologies that
(DPC/NEC)
can be installed at or near the electricity user's site.
9
Welfare Reform, Child Support Enforcement, and Child Welfare
Reauthorize
Reauthorize the current investment ($1.5B).
Welfare-to-Work
Authorize several set-asides: (1) Work-based English-language literacy projects; (2)
(DPC/NEC)
Work-based substance abuse testing and treatment programs; (3) Employment
services for welfare recipients with disabilities; and (4) A work-based program to
promote responsible fatherhood ($500M).
Child Support
Increase the prosecution of egregious child support violators by establishing
(DPC/NEC)
multi-agency teams (a few million dollars/year).
Seek legislation to exclude doctors and other health care providers who are
delinquent in child support from the Medicare program or from programs offering
health professional loans.
Children "Aging
Authorize $150M/year to:
Out" of Foster Care
Expand the independent living program, which provides services to "aging-out"
(DPC/NEC)
foster care children.
Expand the transitional living program, including housing support.
Give states the option of using Federal Medicaid dollars to provide health care
coverage to children aging out of foster care.
Civil Rights and Women's Rights
Equal Pay
Provide $20M to EEOC and $10M to DOL to:
(DPC/NEC)
Increase outreach to businesses and employees about equal pay requirements, provide
technical assistance to businesses seeking to comply, improve training for EEOC
employees, and expand enforcement capabilities.
Fund research on the nature and extent of wage discrimination as well as a new
Women in Non-Traditional Occupations Initiative.
Abortion Violence
Address violence against providers of reproductive health services:
(DPC/NEC)
Launch a national task force established by DOJ that will conduct investigations of
abortion violence, collect and collate information related to clinic violence, and
provide training to federal, state, and local law enforcement personnel on how to
address this problem.
Authorize special security measures, including stepped-up U.S. Marshal support, at
clinics identified to be at risk of violence.
Provide federal guarantees of loans taken out by clinics that must rebuild after they
have been attacked.
Financial Services
Consumer Financial
Approve $5-$10M to:
Literacy and
Promote consumer financial awareness and enhance consumer credit literacy.
Education
Identify problems with how Americans use consumer credit and solutions.
(DPC/NEC)
Reach out to low-income households; expand two existing government programs
--Treasury's Electronic Funds Transfer program and a USDA extension program that
is providing some (limited) services to rural low-income families.
Consumer Financial
Consider making publicly available a list of basic banking services and fees on an
Bill of Rights
individual or geographic basis to be published periodically over the Internet.
(DPC/NEC)
Consider the adequacy of current credit card disclosure requirements and other areas
where information about financial service arrangements would be helpful ($3-$5M).
10
Transportation
Reauthorization of
Improve the efficiency and capacity of the nation's aviation system, and enhance
the FAA, Focusing
competition and service to rural areas by centralizing the air traffic control services in
on Modernization
a performance-based organization, financing ATS for commercial aviation through
and Competition
cost-based user fees, increasing Passenger Facility Charges to finance airport
(DPC/NEC)
expansion nationwide, modifying federal rules on how airports can use PFCs and
other funds to encourage new airline entrants, and enhancing services to underserved
areas.
Further competition in international aviation by pressing our trading partners for
World Wide Open Skies and exploring lifting other restrictions on foreign aviation
investment and operation on a reciprocal basis.
Auto Safety
Develop a comprehensive initiative that would include:
(DPC/NEC)
Meeting the President's goal of 85% seatbelt compliance by the year 2000.
Promoting education initiatives like the Buckle-Up America campaign.
Enforcing the TEA-21 requirement that states lower the legal blood alcohol content
level from .10 to .08.
Promoting the use of child safety seats, booster seats, and bicycle helmets.
Transportation
Ensure the continued mobility, independence, and safety of Americans in their later
Needs of the Aged
years.
(DPC/NEC)
Cooperate with DOT, which plans to hold six town meetings with senior citizens,
medical experts, transportation safety specialists, and others to discuss the problems
and challenges and identify best practices.
Leverage the US-hosted international conference on this topic next year, in
connection with the UN's Year of Older Persons.
Sustainable
Continue investing in sustainable transportation (TEA-21 authorizes $41B over the
Development and
next 6 years for transit).
"Smart Growth"
Empower communities to make smart choices, choosing the right transportation
(DPC/NEC)
investments for their needs. As a result of a new DOT policy, communities can now
use federal funds to clean and reuse brownfields.
Make communities more livable, with support for low-cost projects with big
quality-of-life benefits, such as bicycle paths and historic preservation.
11
Pensions
Expanded Private
Call for legislation that (1) authorizes a simplified plan for small businesses that
Pension Plan
combines the best features of a defined benefit and defined contribution plan
Coverage
($313B/5 years); (2) provides a 3-year tax credit to encourage small businesses to set
(DPC/NEC)
up retirement programs ($508M/5 years); and (3) authorizes payroll deductions for
IRAs.
Expand coverage for moderate and lower-income workers.
Enable multiple small businesses to pool together for pension plan administration.
Women's
Enact the two initiatives announced in late October:
Retirement Security
Count time taken under FMLA toward retirement plan vesting requirements.
(DPC/NEC)
Mandate that employer plans offer an option that pays less while the retired employee
is living, but pays a survivor benefit equal to at least 75% of the benefit the couple
received while both were alive.
Pension Portability
Renew the call for reducing vesting requirements from 5 years to 3 years for
(DPC/NEC)
employer matching contributions to 401(k) and other plans to reflect an increasingly
mobile workforce.
Increase pension portability and facilitate the movement of retirement savings
between plans, where this can be done without encouraging "leakage" or loss of
worker protections.
Expand Pension
Call for a pension right to know package that provides for both workers and their
Right to Know
spouses general information relating to retirement needs and their benefits under
Provisions
employer retirement plans.
(DPC/NEC)
Provide an employee's spouse the same rights to get information as the employee.
Provide employees with the tools they need to work with their employers to provide
pension plans, and are consider how to encourage courses in high schools on the
importance of savings and other general investment education.
Introduce savings stamp book programs in the schools to help educate the young
about how to reach savings goals.
Increase Retirement
Continue to work on the pension audit bill, modify the multi-employer plan rules, and
Security
expand PBGC's missing participant program.
(DPC/NEC)
12