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Minutes of PCSCB Hearings on 1/30-31/98

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Commission to Study Capital Budgetting

March 7, 1998


Hearings of January 30 and Meeting of January 31, 1998


Transcript available

The hearings and meeting were transcribed. Copies of the complete transcriptions are available upon request.

Hearings of Friday, January 30, 1998

Introduction. The co-chairs of the Commission, Kathleen Brown and Jon Corzine, began the hearings shortly after 9:00 a.m. on Friday, January 30, in the Senate Budget Committee Hearing Room, Room 608 Dirksen Senate Office Building, Washington, DC. All Commissioners were present at this time or shortly thereafter, except for Laura D'Andrea Tyson, who gave prior notification that she could not attend, and Richard Leone, who was ill. Sitting at the table with the Commissioners were Barry Anderson, Executive Director of the Commission, and William Dinkelacker, Designated Federal Official from the Department of the Treasury. As required by the Federal Advisory Committee Act, the meeting had been announced in the Federal Register.

           Several items were distributed to the public and the Commission or available at the meeting:

--        an agenda;
--        the fact sheet about the Commission;
--        the press release announcing the meeting;
--        the announcement in the Federal Register regarding the meeting;
--        draft minutes of the December 13 meeting; and
--        three items prepared by staff for discussion:

    • "Budgeting for Capital in the Federal Government" (draft working paper, January 14, 1998; prepared at the request of the co-chairs);
    • "Materials for the Orientation on the Federal Budget;" and
    • "Materials about the Federal Budget Process" (January 15, 1998).
In addition, written testimony of witnesses was distributed during the day.

Purpose. The purpose of the hearings was to take testimony from the witnesses about capital budgeting, ask them questions and, as time permitted, to hear a staff presentation about the Federal budget.

Testimony. The following persons appeared before the Commission:

9:00      Senator Robert G. Torricelli (NJ)

10:00    Representative Robert E. Wise, Jr. (WV) and Representative James L. Oberstar (MN)

11:00    Senator Frank R. Lautenberg (NJ)

1:30      Delegate Eleanor Holmes Norton (DC)

3:00      Senator Michael B. Enzi (WY)

3:30      Edward G. Rendell, mayor of Philadelphia and Chairman, Rebuild America Coalition, with
             James Lebenthal, Vice Chairman, Rebuild America Coalition, and William Bertera,
             Executive Director, Rebuild America Coalition

4:00      William R. Buechner, Director of Economics and Research, American Road and
             Transportation Builders Association

Written testimony was submitted by Senators Domenici (who could not appear), Lautenberg and Enzi; Representatives Wise and Oberstar; Delegate Norton; and Mr. Buechner. Copies of the written testimony are available upon request to the Executive Director, Barry Anderson.

As time permitted during the day, Phil Dame and Justine Rodriguez presented information about the Federal budget process based on the staff handout, "Materials for the Orientation on the Federal Budget."

The hearings ended about 5:00 p.m. after the testimony of Mr. Buechner.

Meeting of Saturday, January 31, 1998

Introduction. The co-chairs opened the meeting at 9:05 a.m. in the Truman Room of the White House Conference Center, 726 Jackson Place, NW, Washington, DC. The meeting was open to the public. Sitting at the table with the Commissioners were Barry Anderson, Executive Director of the Commission, and William Dinkelacker, Designated Federal Official from the Department of the Treasury. As required by the Federal Advisory Committee Act, the meeting had been announced in the Federal Register.

The same handouts were available to the public as those on January 30. In addition, staff distributed:
--        a paper, "Charging Programs for the Full Cost of Using Capital;"
--        a set of charts, "Federally Owned Capital Investment;" and
--        a set of tables, "Income, Outgo, and Balances of Trust Funds Group."

During the meeting, the co-chairs distributed three items, all of which were discussed by the Commissioners:

--        "Potential Additional Participants," a list of organizations that might be invited to testify
           or submit written testimony;
--        Report Outline; and
--        Proposed Working Groups.
Minutes.--The Commission approved the draft minutes of the December 13 meeting as written. They immediately announced that the March 6 and 7 hearings and meeting would be held in Washington, DC, not in San Francisco, a change from what had been discussed in the December 13 meeting.

Staff presentations. Staff sitting at the witness table to present information about the Federal Budget were Phil Dame, Justine Rodriguez, Bob Kilpatrick, Rusty Moran, and Art Stigile. Until about 10:00 a.m., they discussed the Budget Enforcement Act, capital acquisition funds, and trust funds. Barry Anderson discussed the budget process in the Congress, including the development and approval of the budget resolution; the allocations of spending among the congressional committees and subcommittees; the Budget Enforcement Act; enactment of appropriations, a reconciliation bill, and other legislation before October 1; and related issues.

Throughout the presentations there were many questions and observations by the Commissioners.

Materials distributed by the co-chairs. About 10:00 a.m. the co-chairs distributed the three items noted above (invitees for testimony, proposed outline, and proposed work groups). There continued to be discussion of all three items, especially the topics for the work groups, the areas they would cover, and the preferences of the Commissioners assigned to each. The work groups and Commission assignments were as follows:

A.       Mission Statement and Basic Questions for Commission to Answer
           Commissioners: Jon Corzine, Kathleen Brown, Woody Brittian, Stan Collender

B.       Inventory of Capital Budgeting in Other Government and Private Sector Entities and
           Possible Models
           Commissioners: Luis Nogales, Dick Leone, Steve Rattner

C.       Micro and Macro-economic Perspectives on Public Investment and Quantification of Value
           of Public Investment
           Commissioners: Carol O'Cleireacain, David Levy, Herb Stein

D.       Definition of Capital and Budget Discipline
           Commissioners: Jim Lynn, Cynthia Metzler

E.       Depreciation and Intergenerational/Timing Issues
           Commissioners: Rudy Penner, Orin Kramer, Robert Rubin

F.       Federal Budget and Funding/Financing Process
           Commissioners: Stan Collender, Rudy Penner

The co-chairs asked that staff be assigned to assist each work group. The lead Commissioner for each group was asked to report back to the Commission on March 7 with a work program for their group.

The meeting adjourned at 12:25 p.m.

President's Commission to Study Capital Budgeting

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