Bush still weighing rejection of $5.1 billion emergency fund

The White House has not decided yet whether to release a $5.1 billion contingency package that Congress authorized in the $28.9 billion 2002 supplemental spending bill last month, but there are indications President Bush is leaning toward rejecting the money, a move that will aggravate appropriators.

"The issue is still under review," an OMB spokeswoman said. "We'll have a decision as soon as we have a decision."

A report in Saturday's Washington Post, quoting unidentified administration sources, said top White House aides were urging Bush to teach Congress a lesson about overspending by rejecting the contingency funds. The package includes money for veterans' medical care, the Transportation Security Administration, foreign aid, election reform and a host of other homeland security items.

Appropriators sought to force the administration's hand on the package, which is mostly made up of money that Bush did not request, by designating it an "all or nothing" item.

The designation forces the White House to either declare the entire $5.1 billion an emergency need and release all the money or to reject the entire package outright and kill projects popular with members of Congress, including leading Republicans.

The president still has nearly three weeks to decide. During the long debate on the supplemental, the administration complained that Congress was trying to appropriate money that could not be spent by the end of the 2002 fiscal year and that many agencies still had money left from the $40 billion that Congress appropriated on an emergency basis after the Sept. 11 terrorist attacks.

In yet another signal that the administration may be prepping Congress for the eventual rejection of the contingency package, OMB released a report late Friday which said that as of June 30, federal agencies had yet to obligate $14 billion of that $40 billion, and that "historic trends would indicate that current funding levels are sufficient to cover agencies for the remaining weeks of the fiscal year."

The only agencies likely to spend most of their funds were the Defense Department and the TSA, according to the report. Under the supplemental, Defense received $14.3 billion, while TSA received $3.85 billion, although $480 million of that is tied up in the contingency account.

A spokesman for Senate Appropriations, Chairman Robert Byrd, D-W.Va., said today the senator "remains hopeful that the president will agree with Congress on the emergency nature of these items."

If the administration eventually decides to reject the money, it may ask Congress to appropriate additional funds in the fiscal 2003 budget for some of the items-a move that will not sit well with congressional appropriators who have already complained about OMB's intransigence on 2003 spending parameters.