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Sunday, October 23, 2016

President Proposes FY 2000 Budgets with More User Fees

September 1, 1999

President Clinton's FY 2000 budget proposes new user fees to offset programs administered by the USACE, the USCG and NOAA. The $3.9 billion budget request for the USACE provides a 21 percent increase over its FY 99 request, but is still below the $3.96 billion appropriated by Congress for USACE programs last year. Most of the increased spending is earmarked for deep-draft ports and channels and environmental programs, with inland waterways and flood protection projects funded at roughly the same level as in FY 99. As expected, accompanying the budget request is a proposal to repeal the Harbor Maintenance Tax (HMT) and replace it with a Harbor Services User Fee (HSUF). Few specifics regarding the fee are contained in the budget, except it would be assessed against carriers, would be uniform nationwide, and would collect approximately $980 million annually. Under the proposal, fees would be charged to vessels transiting the harbors of the U.S. These receipts would be available for the following fiscal year for appropriation to fund construction and operation and maintenance of the nation's channels. The budget proposes $1.2 billion for the USACE's general construction account, $257 million of which would come from the not-yet-enacted HSUF for port improvement construction. The budget requests $1.8 billion requests for the USACE's Operation and Maintenance account, with $693 million of that figure coming from the HSUF. For the USCG, the President requested $4.2 billion for FY 2000, as compared to a $4.1 billion request in FY 99. Surprisingly, this year's budget proposes the reintroduction of the same navigational assistance user fee proposed and rejected by Congress last year. The Administration's proposal would institute new USCG and NOAA user taxes for federal navigation safety services, such as aids to navigation and VTS systems. The USCG fee, to be collected from commercial cargo carriers, is projected to recover $41 million in FY 2000 and $165 million annually when fully implemented.

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