H.R. 1035: Morris K. Udall Scholarship and Excellence in National Environmental Policy Amendments Act, as amended

H.R. 1035

Morris K. Udall Scholarship and Excellence in National Environmental Policy Amendments Act, as amended

Sponsor
Rep. Michael H. Michaud

Date
October 7, 2009 (111th Congress, 1st Session)

Staff Contact
Communications

Floor Situation

H.R. 1035 is being considered under suspension of the rules, requiring a two-thirds vote for passage. The legislation was passed by the House on July 28, 2009, by voice vote. The Senate passed the bill, with an amendment, by unanimous consent on September 23, 2009.

Bill Summary

Morris K. Udall Scholarship and Excellence in National Environmental Policy Amendments Act: H.R. 1035 amends the Morris K. Udall Scholarship and Excellence in National Environmental and Native American Public Policy Act of 1992 to rename: (1) the Act, the Morris K. Udall and Stewart L. Udall Foundation Act; (2) the Morris K. Udall Scholarship and Excellence in National Environmental Policy Trust Fund, the Morris K. Udall and Stewart L. Udall Trust Fund; (3) the Morris K. Udall Scholarship and Excellence in National Environmental Policy Foundation, the Morris K. Udall and Stewart L. Udall Foundation; and (4) Morris K. Udall Scholars, the Udall Scholars.

The bill requires the Executive Director of the Foundation to be paid at a senior executive rate.  The bill directs the Foundation to award grants to the Udall Center for Studies in Public Policy, at the University of Arizona, to conduct training, research, and other activities with regard to the involvement of Native American and Alaska Native professionals in health care and public policy.  The bill allows the use of reasonable amounts of the Trust Fund for official reception and representation expenses, not to exceed $5,000 for a fiscal year.

Travel Promotion Act:  The bill also includes the text of S.1023, the Travel Promotion Act. 

Visitor Tax:  The bill would impose a fee on foreign visitors to the U.S. from Visa Waiver Program countries, to be established and collected by the Secretary of Homeland Security.  The initial fee would be $10 per travel authorization.  These fees would be deposited into the Fund described below.  The Secretary would not be able to collect the fee after September 30, 2014.

Corporation for Travel Promotion:  This provision would establish a nonprofit Corporation for Travel Promotion to be headed by an 11-member board of directors to be appointed by the Secretary of Commerce.  Board members would not receive compensation.  The bill does allow the Corporation to have an executive director and employees. 

The Corporation would develop and execute a plan to (1) provide information to foreign visitors regarding U.S. entry requirements and fees; (2) identify "misconceptions" regarding U.S. entry policies; (3) advertise and promote the benefits of travel to the U.S.; (4) ensure that all States and D.C. benefit from international travel; and (5) prioritize activities towards countries and populations most likely to travel to the U.S.  Specifically, the Corporation would be able obtain grants and enter into contracts with companies, State, and federal agencies, and hire consultants, for example. 

Limitations on Expenditures:  The Corporation would not be able to spend more than $25 million on any campaign, unless approved by two-thirds of the board members.  The Corporation would have to adopt a budget for each fiscal year and undergo annual audits.  The budget would be sent to the Secretary of Commerce and would available to the public on the Corporation's website.  The Corporation is required to submit an annual report to Congress.

Annual Assessment:  The bill would authorize the Corporation to impose and collect an annual assessment on U.S. members of the travel industry represented on the Board, in proportion to their share of the aggregate revenue of the industry.  The initial aggregate assessment could not exceed $20 million.  The assessment would have to be approved by a majority of members of the industry in a referendum.  The Corporation would be able to bring suit in federal court to compel compliance with this assessment.

Travel Promotion Fund:  Under the bill, a Travel Promotion Fund would be established in the Treasury.  In Fiscal Year 2010, the Treasury Secretary would make up to $10 million available to cover the Corporation's initial activities.  In Fiscal Years 2011-2014, the Secretary would make up to $100 million available to the Fund.  No funds would be available to the Corporation in Fiscal Year 2011, unless the Corporation provides matching non-federal funds equal to at least 50 percent.  In Fiscal Years after 2011, the Corporation would have to provide matching funds equal to 100 percent.  Goods and services other than money may be included in non-federal source matches, but could not account for more than 80 percent of the required match. 

Office of Travel Promotion:  The bill would establish an Office of Travel Promotion at the Department of Commerce.  This office would serve as a liaison to the Corporation and support programs to increase the number of international visitors to the U.S.

Authorization of Appropriations:  The bill would authorize such sums as may be necessary to the Secretary of Commerce for Fiscal Years 2010-2014 to carry out expanded research programs at the existing Office of Travel and Tourism Industries.

 

Background

The scholarship was created in 1992 to honor former Arizona Congressman Morris K. Udall. Through the operation of internship, scholarship and fellowship programs, financed by a permanent trust fund endowment, the program is designed to increase opportunities for young Americans to pursue careers related to the environment and to Native Americans and Alaska Natives who intend to pursue careers in health care and tribal public policy.

The Senate amendment to the bill struck a section that would authorize such sums as may be necessary for (1) the Trust Fund; and (2) the Environmental Dispute Resolution Fund, for the operating costs of the United States Institute for Environmental Conflict Resolution. The bill also now includes the text of S.1023, the Travel Promotion Act. The Senate passed that bill by a vote of 79-19 on September 9, 2009.

Some Members may have several concerns with this provision that would create a government tourism advertising campaign funded by taxes on international visitors. Some Members may believe that taxing visitors during an economic downturn would in fact discourage visitors coming to the U.S. Furthermore, according to the Heritage Foundation, the tourism industry is the second-largest service export industry, and thus some Members may view it as a subsidy to large companies.

Additionally, the European Union has informed the Obama Administration that it opposes this provision. In a June 19, 2009, letter, the European Commission Ambassador wrote that the provision would "constitute a step backwards in our joint endeavour to ease transatlantic mobility" and have "potentially negative implications on reciprocal visa-free travel between the EU and the U.S." This could feasibly mean reciprocal taxes on American travelers to Europe.

 

Cost

A CBO estimate for the education portion of H.R. 1035 is not yet available.

According to CBO, the new federal bureaucracies created by the bill, the Corporation for Travel Promotion and the Office of Travel Promotion, would increase direct spending by $630 million over five years and $1.2 billion over ten years. In addition, CBO estimates that the bill would result in approximately $80 million in spending subject to appropriation over the next five years.

In order to comply with PAYGO rules, the legislation includes three provisions that CBO estimates will increase revenues. First, the bill would require the DHS to increase the user fee, or surtax, on people who participate in the government's visa waiver program. Under current law, the fees cannot exceed the cost of covering the program's overhead. H.R. 1035 would impose an additional $10 fee to all visa waiver program participants that would be applied to the cost of the travel promotion agency. The Corporation would have to match the amount of money they receive from the DHS fee increase with funds from assessments and voluntary contributions described below. CBO estimates the increased fees would bring in $810 million over ten years.

Second, the Corporation for Travel Promotion would be authorized to impose new assessments on private members of the travel industry "in proportion to their share of the aggregate international travel and tourism revenue of the industry." The bill allows the Corporation to collect a total of $20 million in assessments each year. The bill authorizes the Corporation to make an assessment if a majority of travel industry members approve it in a referendum. Therefore, a simple majority of travel industry members could approve an assessment against one of their competitors. According to CBO, these assessments would qualify as unfunded private sector mandates under the legislation.

Finally, the bill would allow the Corporation to accept private voluntary donations from travel industry members. Voluntary contribution would be counted as offsetting receipts, along with the new user fees and assessments. According to CBO, the Corporation expects to receive estimates that private industry donations to the government program will total $660 million over ten years.

When these three revenue raisers are combined, CBO estimates that the legislation would provide approximately $1.7 billion in offsetting receipts over ten years. According to CBO's estimate, offsetting receipts would offset the bill's $1.23 billion cost and reduce budget deficits by $425 million. However, some Members may be concerned that a portion of the offset is achieved by increasing fees for participants in the visa waiver program above the amount necessary to cover costs.