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Skriven 2006-02-06 23:33:26 av Whitehouse Press (1:3634/12.0)
Ärende: Press Release (0602068) for Mon, 2006 Feb 6
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Press Briefing on the President's Fiscal Year '07 Budget and Low-Income
Programs
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For Immediate Release
Office of the Press Secretary
February 6, 2006

Press Briefing on the President's Fiscal Year '07 Budget and Low-Income
Programs
Dwight D. Eisenhower Executive Office Building, Room 66



PARTICIPANTS
Jim Towey, Director, Office of Faith-Based and Community Initiatives
Claude Allen, Assistant to the President for Domestic Policy

2:35 P.M. EST

MR. ALLEN: Good afternoon. I'm Claude Allen, Domestic Policy Advisor to the
President.

DIRECTOR TOWEY: And I'm Jim Towey, Director of the Office of Faith-based
and Community Initiatives.

MR. ALLEN: We wanted to start off by giving what we think are some
highlights, and you've heard some of this before, but I think it's
important to put everything we talk about, when we talk about low-income
programs, into context; and what the administration's policy and philosophy
has been behind what we've done in this area.

Unemployment has dropped 12.7 percent, lowest monthly rate since July of
'01; 193,000 jobs created in the last month, since January; 2 million
created in the past year; 4.7 million since August of '03. Home ownership
has broadened to low-income individuals -- in fact, we have the highest
rate of minority home ownership on record; in 2005, the rate was 51.3
percent; female-headed households at 59.4 percent; families below median
income at 52.9 percent. And even young families with children, like Mr.
Towey and I, at 64.8 percent. And so we see the indicators of what is a
strong economy actually reaching down to low-income individuals.

In addition to that, the President has emphasized in his budget proposals
fiscal discipline and also focus on priorities that impact the budget
across the board. And we have focused on overall spending, reducing overall
spending, in terms of non-discretionary programs. And, yet, we've actually
increased funding for programs in this area by 44.5 percent since 2001. And
these are core programs that impact low-income individuals.

And I think -- so the message that I want to leave with you today is that
as far as the administration's proposals are concerned, when we look at
core safety net programs that impact low-income individuals, the state of
the union is not only strong, but in this area the programs are effective
and are working.

And the areas that I want to focus on, I think we look at, when you talk
about core safety net programs you're talking about housing, you're talking
about food, you're talking about health care, education, and you can even
throw work in as a means of folks coming out of poverty and low-income. So,
again, the safety net is tight and strong and I think those are some very
important points to bear in mind.

I'm going to let Jim talk a little bit about some of the specific programs
he's working on, and then just open it up for questions. I wanted to just
lay that out as a framework to discuss.

DIRECTOR TOWEY: Thanks, Claude. I just want to echo, I think, Claude's
points.

When the President took office I don't think anyone could have anticipated
the wave of extraordinary events of both dealing with the war on terror and
the need to keep America safe, as well as Hurricane Katrina and as well as
the pressures on the budget and the deficit. And in spite of these enormous
challenges that have confronted the President, he's maintained a
compassionate budget that meets essential needs of American citizens, and
also seeks to fund effective programs that have a meaningful intervention
in the lives of Americans.

During his time in office, the Faith-based and Community Initiative has
been one of the President's signature efforts to mobilize America's armies
of compassion to help the homeless and the addicted and the children of
prisoners and the kids that are at risk of gang involvement, as well as
helping some of the prisoners re-entering society. And this budget of the
President proposes $323 million for these programs, which is a 36 percent
increase from what was enacted in fiscal year 2006.

In addition, the President's budget continues America's humanitarian effort
to resettle refugees from across the world. The number we settled last year
exceeded 50,000; and the budget projects a similar number this year, with
an increase of $45 million. And, of course, these re-settlement agencies
often are faith-based and grassroots groups that provide this humanitarian
assistance to the stranger that we welcome into our midst.

Of course, the PEPFAR funding in the budget this year is a very impressive
amount of money, nearly a billion dollars over last year's budget request,
continuing the President's compassionate initiative dealing with AIDS in
Africa and elsewhere.

So there are a number of initiatives with the homeless, the community
health centers and other programs that I think are evidence of the
President -- during a very tight budgetary time with pressures from the
wake of Katrina and the war on terror, to the budget deficit and the needs
to rein in mandatory spending -- the President has put forward a reasonable
budget that's compassionate.

MR. ALLEN: We'd be glad to open it up for questions.

Q Mr. Towey, in the most general terms, what does the $323 million include?

DIRECTOR TOWEY: The $323 million, Mike, would include $40 million for the
mentoring of the children of prisoners; $100 million for the Compassion
Capital Fund, a program the President started, of which $50 million would
go to the initiative Mrs. Bush has spearheaded, Helping America's Youth, to
prevent kids from getting into gang involvement. The Access to Recovery
program is $98 million. This is an innovated drug treatment program that
allows addicts to choose where they're served; it's operating in 14 states
and with one tribal government.

The Prisoner Re-entry Initiative is budgeted at $60 million. This continues
the President's effort to address some of the needs of the 600,000 inmates
that are returning to society this year. And then the new initiative the
President announced in the State of the Union address dealing with AIDs --
I count in that $323 million, $25 million which is going to be targeted for
outreach to the African American communities, which I think the statistics
support we have a health crisis within our African American community when
it comes to transmission of AIDS. There was a very interesting piece I'd
commend your attention to in The New York Times over the weekend, that
showed how one in five African American males age 40 to 49 has HIV/AIDS.

So we have an effort that's part of a $188 million initiative the President
launched that's in the budget. But the $25 million I counted adds up to the
$323 million, Mike.

Each one of those are targeted initiatives. I refer to them as that because
they were announced in the State of the Union address and then carried
forward through successive budgets. Some of them, like the Compassion
Capital Fund, started receiving funding in 2002; and others, like the gang
initiative, received its first amount of funding this year.

Q If I may ask one other quick question. It's 36 percent over -- enacted
last year. Do you know, by chance, about what it is over what was proposed
last year?

DIRECTOR TOWEY: Sure. Enacted, $236 million -- I think I've got the numbers
here, Mike; I'm going to try to do them by memory, and if I can't dig them
up, I'll get them to you. But if my memory serves me correctly, PRA --
let's see, Compassion Capital Fund receives $64 million. Yes, Prisoner
Re-entry received $25 million. The Access to Recovery received $98 million.
And the mentoring of children of prisoners received $49 million. That sum
is $236 million. And the budget this year will propose $323 million.

Q Are those programs, like, say, the children -- prisoners' children, are
those all run by faith-based organizations, or are they run by the
government?

DIRECTOR TOWEY: No. They're openly competed grant programs, Richard, that
provide funds for faith-based and community groups to compete. We'll be
providing data next month on the 2005 grant totals, broken down by
faith-based charities, secular not-for-profits, governmental entities;
we'll be providing the statistics for 2005. But these are openly competed
programs. And you'll see throughout government a range -- for example, some
grant programs have very little faith-based group involvement and others
have much higher levels.

Q I guess I see a little bit of tension between what some in the low-income
advocacy world see in the President's budget policies and what you're
describing, Claude. You're talking about a core of programs that are
increasing and are getting pretty healthy funding. But I think people in
the advocacy world see other programs that maybe you don't regard as quite
as effective that are getting cut.

MR. ALLEN: Sure, and I think it's very important to acknowledge that,
indeed, individual organizations and interest groups are going to focus on
the programs from which they get their funding from. But when you step back
and look at this administration's policies and its funding, programs that
serve low-income individuals, there is just -- you can only come to the
conclusion that there is a very strong commitment to these programs.

Look at the housing area, for example, where there is a billion dollar
increase in our Section 8 and home programs. That is an example.
Notwithstanding that, if you go down and drill down and find a specific
program, that when we look at it question is does it meet a high priority,
is that program effective at achieving the goals, and can we measure that
outcome. And if it doesn't meet that, then we're going to continue funding
housing programs that serve low-income individuals, but we're going to
target that money to the most effective programs to reach the most number
of individuals who can be served.

Q Well, the budget has 141 programs proposed to be cut. Do those include
faith-based -- I know it may be core faith-based programs, but programs
that would benefit faith-based or community organizations?

MR. ALLEN: Again, if the program is not deemed effective, or the program
does not have demonstrated results, we're not going to shield a program
from scrutiny because it may or may not be a faith-based -- program that
faith-based organizations can benefit from. What we're looking at is,
again, maintaining the priorities in the budget, maintaining a commitment
to proven outcomes and a track record of demonstrated effectiveness, and
then we'll go with it from there. But, yes, some of those programs may
include and actually impact --

DIRECTOR TOWEY: And there's no litmus test here. The President is not
interested in religion, he's interested in results and he's trying to fund
programs that have proven to be effective. And it may be that some
program's faith-based organizations find that they've received grant
dollars from that have been cut, or they've been increased. But this budget
has attempted to fund priorities of the administration.

MR. ALLEN: But I also would point out, too, that the administration has
focused on opening more programs up by leveling the playing field for
faith-based organizations to compete on a level playing field with other
organizations. And so that has also happened in this budget. So a
faith-based organization that may serve, again, in the housing section, for
example, while a specific program may not have been funded at the level it
had been in the past, there's still opportunity for them to compete for
those funds.

Q Are you able to quantify and -- kind of speaking in the big picture --
the extent to which under this President your, kind of, philosophical and
ideological focus has shifted from government programs to private,
faith-based programs in funding, and the extent to which those government
programs might be more -- more of those have been cut, obviously, than
faith-based.

DIRECTOR TOWEY: I think, again, the filter has been on effectiveness,
Peter, and the effort has been to fund priorities of government, look at
effective partnerships, remove barriers that prevented these groups from
competing in the past, and then let the best group win. The reality is if
you looked at the data last year in the category of competitive non-formula
grants, the great majority of money went to secular not-for-profits and
government entities, not religious charities. So I think there hasn't been
any dramatic shift. What has happened, though, is barriers have been
removed and now we're seeing groups competing for the first time for these
grant dollars.

I'm going to Harrisburg, Pennsylvania, tomorrow; we've got a packed house
of groups that want to learn how to compete. This is our 21st conference
and each one of them, more and more groups are finding how they can work
with government. We're going to have new data out in March that's going to
show a dramatic increase in first-time grantees, continuing a trend since
the President started this initiative.

So from my standpoint, the initiative has never been about religion, but
about results and about funding the best provider, whomever it is. And I
think that -- is there a sense that there's more competition for these
dollars? You bet. There is a greater level of competition, and I guess that
does threaten the status quo. But at a time when budget resources are tight
because of the war on terror and other pressures, you need to have
competition. The poor deserve it.

Q Last year I remember there were questions about how you calculate the
amount of money that actually is going to faith-based groups, across the
agencies and across the budget. Have you all worked on a way to calculate
that more accurately?

DIRECTOR TOWEY: Each year -- you'll see the data next month, Peter, and
we'll be happy to give it to you. Each year I think we get a better focus.
I don't know if you can ever get a hundred percent accurate picture because
you have, at some point, to determine is the group faith-based or not -- if
you're counting dollars to religious charities, and we let them
self-identify. So we try as best as we can and we'll show you the data.

But I think what it's showing is greater competition, and we believe it's
going to lead to more effective results.

And the budget also represents an effort on President Bush's part to
promote individual choice in programs. The individuals can choose their
provider, instead of being shuffled through a program that may be a failing
program.

Q In terms of the mental health sector, there are a bunch of conservative
groups who argue mental health guides are medicalizing character, and in
such light they feel that under this administration the mental health
industry has been getting money for Teen Screen and for converting
character flaws or behavior decisions into medical problems. They cite the
new Freedom Commission, the SAMHSA support for Teen Screen and various
other things.

Is there anything in this budget that would suggest you are moving to
support character and community-based efforts on character and behavior,
rather than the mental health industry?

MR. ALLEN: I would say probably the one that stands out to me most directly
where we're focusing on helping young people avoid risk behaviors would be
the Helping America's Youth Initiative, which is targeted at at-risk youth
who are at risk of getting involved with alcohol, drugs, tobacco, sex and
violence, particularly with the focus on young boys and their getting
involved with gang activity.

I believe it's $150 million -- $50 million over three years, $50 million --
a three-year initiative, $50 million that really is working to identify
science-based, research-based, evidence-based ways of working with young
men and women, boys and girls, to help them navigate life successfully by
equipping them with skills to address these risk behaviors.

Q But $50 million versus tens of billions a year on mental health is not a
lot of -- it's not a big comparison.

MR. ALLEN: Again, the substance is in the SAMHSA area. SAMHSA also is
focused on risk avoidance programs, and not simply risk reduction programs.
And the risk avoidance programs actually focus on giving kids assets that
we know, based on science, work effectively -- that is connectedness to
parents, connectedness to schools, and connectedness to communities. And so
Helping America's Youth is actually an umbrella that brings in and helps
focus what SAMHSA is spending its money on, in a way that will get results.

And so just as we're focused in every other area on outcomes and results,
with young people we're also focused on those programs that work to help
them be equipped so that they can actually make choices that are healthy
and good choices for them.

Q Is there any time you cut money for any of the groups or activities or
approaches that you feel are less effective?

MR. ALLEN: In the SAMHSA area, we would have to -- I would defer to the
budget folks on it because I can't think of --

Q In the broader area. Can you cite any cuts you made because of
competition, because one approach is better than another?

MR. ALLEN: Well, I can tell you that in the '07 budget we propose 141
programs that were deemed ineffective or otherwise not demonstrating
results. And so that whole list you can find something in there. I don't
have the list of the 141; maybe we can just get that for you.

DIRECTOR TOWEY: I think TANF is a good example of an approach where -- the
funding for TANF is maintained -- has been maintained over the years, even
though the caseloads have gone down. But there was an effort by Congress to
try new approaches and to discard old approaches, and I think everyone
agreed that in the 10 years since welfare reform took place we've seen
dramatic changes for the better. And so those are examples --

MR. ALLEN: I think another area that I'd cite to you also is in the CDBG
program. One of the major issues in that program is that we have some --
almost about an $800 million program, and about half of those programs are
earmarked. So, therefore, without a regard to whether the community has a
need for low-income individuals to be served, whether the program is
effective, or not, half of the budget for the CDBG program is tied up in
earmarks.

Well, the President has made a direct appeal to Congress to work with them
in earmark reform. And so here's an example where we can work with
targeting limited resources to the communities that have the highest needs,
as opposed to giving it to the wealthiest communities in the country
because it has been earmarked in that direction. So those are some of the
areas that we focus on, as well, in the budget.

And along with programs that have been effected -- I think you had
mentioned the 141 programs in the '07 budget, but the history of it is, is
in '05 we had, I believe it was 65 programs that were proposed for
elimination or reduction, and Congress enacted seven of them -- the cuts,
and that was about $300 million worth of programs. In '06, the President
proposed 154 programs to be slated for elimination or reduction; Congress
approved of 89 of them, for $6.5 billion. And this year we're proposing the
141, for about $13.5 billion.

And so we see Congress coming along, working with us as we provide them
more and more information on effectiveness of programs and whether they
meet the priorities for what we're serving. So even Congress is working
with us to address this issue as we find challenges in the budget areas.

Q Is the CDBG in this year's cuts?

MR. ALLEN: Actually, CDBG -- we are preparing for a -- you may recall the
Strengthening America's Communities Initiative last year, that did not
receive a lot of strong attention, even though there's a recognition that
there needed to be reforms in the CDBG program. That program will go back
-- HUD is preparing a proposal right now to go to Congress for legislation
that would actually bring the reforms that we were speaking about in the
program, changing the funding formula, and then compete it by making a pot
of money available for communities that are performing well to actually
compete for it.

The numbers for CDBG -- let me make sure I've got those for you -- it goes
from the '06 enacted level of $3.7 billion down to $3.0 billion. And we get
there by consolidating 17 programs under the -- and going after largely the
administrative dollars that would be from the consolidation. And most of
those would be consolidated in the Department of Commerce, and then HUD
will also be focused on getting some performance out of those programs that
will come into CDGB at HUD, as well.

Q Jim, in the five years since the Faith-based Initiative has been up and
going, how many of the primary barriers have been removed, in your
estimation, in terms of allowing groups to compete for funds?

DIRECTOR TOWEY: When the President took office, at Housing and Urban
Development, for example, there were regulations that said if your program
has, "any religious influence," you can't receive government monies.
Regulations like that had a chilling effect in competition as well as in
allowing the poor to access effective programs and providers.

So through 15 regulatory actions in eight federal agencies, we were able to
remove these barriers. We're now working with 31 governors that have
Faith-based and Community Initiative offices, so that they can do the same
at the state level, where tens of billions of dollars of federal funds are
administered. Today I expect -- while we speak, right now, in Pennsylvania,
we have state and local officials meeting with federal folks to talk about
the equal treatment regulations.

So we're seeing those barriers removed, and as a result, we're seeing much
greater interest in application, and we'll be able to document that group.
So we're pleased with that.

In terms of Congress passing the reauthorization of the welfare reform, the
TANF bill, Temporary Assistance to Needy Families, that will extend
charitable choice protections into the year 2010. This is a first during
the President's time in office to see these religious hiring protections
guaranteed again. And so we're excited about that, and we'll expand to a
new program, through that legislation.

So the President is moving forward with the initiative effectively, and now
we see the conferees in the House and Senate looking at incentives for more
charitable giving. So those provisions are now before that conference. So
there's progress on all fronts. And we've seen the barriers removed.

Q So with that progress, as you stated, is the challenge then to educate or
train these groups through these conferences? Is that kind of shifting as
the primary goal now?

DIRECTOR TOWEY: It certainly is part of it, to provide them technical
assistance -- them and anyone. We enroll any comer. It's first come, first
served registration for these regional conferences to give them the
technical assistance, because we think that heightens the competition and
leads to the best providers. In the past, often grants went to the best
connected provider or the one with the best grant writer, and not
necessarily the most effective program.

And I'll give you an example. Take the mammoth Head Start Program. Even
though it's considered a competitive grant program, the reality is it's
very hard once you've been certified as a Head Start provider to ever lose
that, whether they're effective or not. And that has crowded out
faith-based organizations from even being able to compete for the funds.

That's one of the single biggest barriers -- program barriers that are out
there. When you look at HHS's numbers next month, you'll discover that one
area where there's a concern is in Head Start, because there's a strangle
hold on those funds by the existing providers. Some of them are very
effective, don't get me wrong; but some aren't. And right now there's no
way to -- Claude is serving the President, and his predecessor, Margaret,
have been looking at reforms in Head Start. But the reality is, when you
talk about difficulties in making changes, very often it's been the
faith-based group that's been shut out, or the small grassroots group
that's not connected, in favor or the provider that's been there for a long
time, and some have been effective, some haven't.

Q Jim, you've been giving out grants to the large organizations, small
organizations. What's the range for grants? What's the biggest grant you
give out? What's the smallest? Is there some kind of an average --

DIRECTOR TOWEY: We don't have an average, Richard, but we have a mini-grant
program at HHS in the Compassion Capital Fund this year that gave out 300
grants of $50,000 each. For small grassroots groups, not-for-profits, they
can do wonders with $50,000. The larger grants typically would go in
Section 202 housing. Those can be in the millions of dollars each. So it
will vary. Typically, the Section 202 HUD housing program, roughly half of
the providers are faith-based organizations.

Q Can I ask about two programs that aren't very closely related? One is
LIHEAP, and the other is the Community Services Block Grant. This is a
block grant to goes to, as you well know, community action agencies. You
actually hand out some of the LIHEAP money. The way we're looking at the
budget, both of those are getting squeezed a little bit, although in the
case of the CSBG, it's getting zeroed. Although, I think that money may be
heading somewhere else. But can you just talk about the philosophy behind
those two?

MR. ALLEN: Yes, I think, again, looking at, particularly CSBG program, the
question is, whether the program was effective, and could we track what the
program was doing. And, frankly, we could not. It is very difficult,
because of the way the money goes down to states, localities, it is -- they
can spend it on just about anything. And therefore there's no way to track
whether it is going to effective -- to programs or to specific needs, and
whether it's effective, in terms of meeting the objectives of the programs.
And so there are other block grant programs that are more effective that we
thought would be most appropriate to find those resources going into.

Q That's where that money is going then?

MR. ALLEN: Well, no, I don't want to make it set up -- it goes from CSBG to
another program specifically, and I don't want to make that comparison,
because, no, that's not the way we've looked at the budget. We didn't say,
let's close down the CSBG program and take all that money and transfer it
somewhere. No, that's not the way we've done it.

What we're looking at is whether there's coverage for the types of programs
for which CSBG money has been used. One area where it has been effective
is, again, in terms of addressing Katrina. We have requested additional
funding in these programs to serve the evacuees and to respond in the
disaster area. For example, in the social service block grant program we
requested $500 million for that purpose, and that money was serving a very
specific and targeted purpose, as opposed to what the program typically
would be very broad, and how it could be utilized. So we did that and
looked at that that way.

Q Can I interrupt and ask, are the same agencies, administer that money,
the Social Services Block Grant?

MR. ALLEN: Yes, both of those are administered out Administration for
Children and Families, the FSBG program in large part. CSBG has some also,
I believe, in HUD, and maybe in a couple of other agencies, but primarily
ACF has the lead on those two block grant program.

DIRECTOR TOWEY: Office of Community Services, as well.

Q And on LIHEAP?

MR. ALLEN: On LIHEAP, there actually has been increase in LIHEAP. In fact,
I believe -- I want to make sure I give you the right number -- the request
is $2.032 billion off of '07, an increase from $1.98 billion in '06,
enacted number. And, again, working with Congress, we know that Congress
moved the '06 money into '07, and we're willing to work with them on how
they try to deal with the '06 need for LIHEAP funds. We've been very
fortunate to have --

DIRECTOR TOWEY: That's the contingency --

MR. ALLEN: Yes, the contingency fund is also a huge increase, of $750
million in '07, over $181 million in '06. So the administration has
responded, and responded in a big way, to the concerns for the energy needs
of the season. Fortunately, January has been a warmer month than
anticipated, and so we hope that we'll be able to continue to work to
provide heating assistance to --

Q Can I ask you a quick follow up? There was an advocacy agency that says
LIHEAP is actually getting a cut to $1.7 billion, and they may be basing
that on your BA or something? I don't know --

MR. ALLEN: I'm not sure where that number comes from. We'd have to look at
it. Again, I think when you look at the numbers that we've got going up for
the request, there is significant increase in LIHEAP. I think what they may
be looking at is what Congress did, and that is, is I believe Congress took
what we had for '06, which was $1.7 billion -- yes, I think what Congress
did -- we had a request of -- let me see, '07 is $2.8 billion. Yes, we had
initially supported an additional $1 billion in '06 to address this year's
energy needs around the country, but Congress added it to the '07 figure.
And so we are willing to work with Congress over how they fund '06 in this
area.

DIRECTOR TOWEY: John, if I can add on the issue of the advocacy groups,
because I meet with them a lot, Claude meets with them a lot. I've never
met a group that didn't want to see more funds going to the organizations
for which they advocate. That's the nature of advocacy. And I think the
difficulty, of course, is those groups that are advocating on the human
services front do not have the responsibility of conducting the war on
terror or decreasing the deficit or providing for Katrina relief and all
the other pressures that are brought to bear on the budget.

So had not these enormous events intervened during this administration, who
knows what the budget would look like today. But the reality is the
President has to play the hand he's dealt. And when you have a war on
terror and you have the requirements of the homeland security and you have
Katrina relief that's $88 billion that came out nowhere -- when Claude and
I were first doing budget meetings last year, in the summer, there's $100
billion that wasn't anticipated that's gone -- $88 billion now, and there's
another $18 billion placeholder in the budget. So, you know, we're looking
at this evolves from year to year, and it puts a lot of pressure. We can
understand the advocacy organizations' concern about funding, but the
reality is, the President has to look at the whole pie and he has to keep
the economy running.

MR. ALLEN: But I think with the numbers it would be very difficult for me
to see where any organization would suggest that this administration has
not responded to the needs for LIHEAP funding when we have an emergency
request of $750 million for the '07 budget request contingency fund, and
we've increased the base funding, as well to $2.032 billion. So I don't
understand, again -- that doesn't -- the figures that we have.

And I think that's the message I think you take away. When you look at this
administration's track record from '01 to present, there has been a
significant increase in resources targeted to low-income Americans across
the board, whether that -- again, as I said, when you look at housing, you
look at health, you look at education, you look at food. The WIC programs
received significant increases in funding, very much so.

And even when you look at work-related issues, this administration has
demonstrated a commitment to low-income Americans.

Q Jim, on the refugee resettlement, what's the new goal for that? And is
that complicated politically because we're kind of in the midst of the
immigration thing?

DIRECTOR TOWEY: As you know, the refugee resettlement program after
September 11th came to a near halt as they dealt with the security issues
of screening individuals before they came to America from all these
different refugee camps. But the program happily was resuscitated through
efforts by the President and the Secretary of State. And this past year for
the second continuous year, we've had over 50,000 refugees resettled. I
believe the ceiling this year, Peter, is 55,000. But I'd ask -- you're
going to have to get the number from State.

I think the budget is sufficient to handle at least 50,000 refugees
resettled. And the President has made it clear that's his commitment. They
are experiencing difficulties in some camps, I'm told, with some delays in
getting clearances for refugees to be resettled. But the President's
commitment is unmistakable. And he spoke of the refugees in his State of
the Union.

Q That's not back up to the pre-9/11 levels, is it?

DIRECTOR TOWEY: It is not. I believe it's equivalent to it, Peter. If you
look at it historically during the spike-up during the boat people
resettlement, we had hundreds of thousands resettled. It then tailored off
after -- into the late '90s. And I think when the President took office,
it's equivalent, but it may be a little under. I think you're right. I
think it's a little below.

Q In terms of watching the political struggle over the reallocation of
funding, as you seem to be offering, what should I be watching in Congress
for -- for incumbent advocacy groups seeking to establish rules to protect
their share of the spending?

MR. ALLEN: It's called earmarks. (Laughter.) Again, I think that the
President has made a commitment to working with Congress to reform
earmarks. It is vitally important that we do so. The President rolled out
last week the American Competitiveness Initiative. As an example, in the
research area in science and technology, making sure that America remains
competitive, we see a large number of earmarks. And these earmarks, whether
it's in the discretionary programs or in the mandatory side where we find
earmarks, it actually takes away from the executive branch's ability to
target resources to priority areas in a timely fashion. And so we believe
it's critically important to work with Congress for real earmark reform.

HHS, the Labor H bill, we saw that bill go through that had no earmarks in
it. That shows that Congress can do it when it puts its mind to it, and we
will work with them on that.

Additionally, I think the other key message to recognize is that we have
focused largely on the discretionary budget. I think it's very important
that we recognize that the mandatory budget -- that is largely Social
Security, Medicare, Medicaid, the President has called for -- to work with
Congress to reform each of those programs because if we do not do so, by
2030, those three programs will eat up about 60 percent of the budget. And
we'll continue to see how do we address priorities when a portion of the
budget becomes more and more out of reach because we haven't taken on the
difficult task of reforming it. So those are some areas that you'll find
that we'll be focusing with Congress on, as well.

Q You say the earmarks interfere with the program's ability to target
resources. What about the argument on Capitol Hill that earmarks are placed
by individual members who presumably know what is needed by their district,
and therefore it's better for them to be able to allocate the funding in
that --

MR. ALLEN: Well, I think that's why it's important for us to work with
Congress because again we want identify priorities. What are their
priorities that need to be addressed. And exactly -- for example, in the
area of science, we know the National Science Foundation, the Department of
Commerce's Office of NIST, and the Department of Energy's Office of Science
where many of the dollars that are going towards maintaining America's
competitiveness are earmarked, that takes away the ability to focus on
things such as energy independence, to focus on next generation research
because it's being taken -- siphoned off for a specific project or
proposal.

Again, I cite the example of the CDBG monies, where we see, yes, a congress
person, a congressman or senator may deem that there's an area in their
state that should get some CDBG money, but when you're looking at
nationally where the highest priorities for low-income individuals are, and
the needs for those communities, you need somebody who is able to step back
and look at that in an objective way to say that we're going to target
resources to the most needy.

The President in the State of the Union address said that we will take care
of the poor and the elderly. And working with Congress to do that means we
must have meaningful earmark reform.

Q The HHS Secretary earlier today addressed new initiatives in the HHS
funding, including things like private-public cooperation for hereditary
disease research, and even the health savings accounts, those sort of
things. Will you recruit or solicit the help of faith-based and community
organizations to help, I guess, maybe -- even with the health savings
accounts, they said they need to get more information out there for people.

MR. ALLEN: Absolutely. In part because we will not leave any partner
unturned that is going to work with us to address these issues because
health savings accounts, again, if we have more people in the faith
community who are members of a congregation of faith to take advantage of
health savings accounts, that benefits all Americans. So it doesn't make
sense that we would cordon off a portion of the team to work with on these
issues because they happened to be faith-based.

Again, we're not -- we'd want to include them in these activities because
there is -- many Americans are members of communities of faith; many
Americans in communities of faith have clearly health care needs, and we
need to work with them, just as we work with them in terms of our obesity
campaigns; our other messaging campaigns to address issues that are
confronting their congregants, we will do the same to solicit their support
as we go forward on these initiatives.

Jim, you have anything else to add?

DIRECTOR TOWEY: Hit it on the head.

Q One other question. On the TANF reauthorization and the Budget Reduction
Act, you said it extends charitable choice. And did I understand you
correctly when you said it will extend to one more program? And which one
is that?

DIRECTOR TOWEY: The new program, the Fatherhood and Marriage Initiative
that's in the bill will have charitable choice protections.

Q Does the Marriage Initiative have those also?

DIRECTOR TOWEY: I believe all those programs are under the umbrella of
TANF. And they're both newly authorized, and they will have charitable
choice protection. So this is an important development and continues, I
think, the President's evidence of his commitment to persevere on the
initiative, both on the regulatory front and in Congress.

And when Claude talked about earmarks, if you asked the Attorney General
what the biggest barrier his faith-based and small groups face in Justice
to access juvenile delinquent dollars or other at-risk youth, he'll point
out earmarks. Some of his programs are 100 percent-earmarked. And when you
look at who actually gets the funds, it's a very small percentage of
religious charities. And the question arises, how were those screened, and
how fair is that for the groups out there competing. So the earmark issue
is not only a budgetary issue, it's also a fairness one.

MR. ALLEN: And I think even beyond that, the question is, is whether the
programs that are getting it under an earmark are effective. That really is
the driver. Are they as effective as another program that might be able to
compete for that if it were not earmarked?

DIRECTOR TOWEY: We had two legal cases this year regarding the First
Amendment and the Faith-based Initiative that involved earmarked programs.

Q Are those disputes -- of which I've read about and written about
occasionally -- about freedom of religious, church-state and also sexual
orientation or autonomy, are those arguments ever used to protect incumbent
grantees from competition?

DIRECTOR TOWEY: The White House doesn't grant money. You'd have to ask the
departments what they face. But what our interest is, is a level playing
field; let the best program win.

Q Going back to the Helping America's Youth Initiative -- you said $50
million is going to be earmarked for that program --

MR. ALLEN: Not earmarked, but included in the budget. (Laughter.)

Q Okay, sorry. Of that, how much is going to mentor youth? Do you know
that, by any chance?

MR. ALLEN: I don't know the exact dollar figures. We do have a program that
really focuses on mentoring youth.

DIRECTOR TOWEY: A separate program -- mentoring of the children of
prisoners, the budget has $40 million for that program this year, within
the $50 million diverting children from gang involvement. This will involve
outreach workers. There will be a competitive grant program like we have
seen in the Compassion Capital Fund from year to year to year. It will be a
competitive program where we will target areas of the country where gang
involvement is high.

And then organizations will have to demonstrate an ability -- a proven
record and ability to engage that community and divert youth from it. Some
may be mentoring programs. Big Brothers and Big Sisters is a good example
of a program that not only will mentor the children of prisoners, but is
also involved in diverting kids from gang involvement. So that grant
programs specifics, this year there will be $30 million being spent on it
in the '06 enacted money. For the $64 million of the Compassion Capital
Fund, $30 million will go to the at-risk youth this year.

And I believe Claude has additional funds that have been identified for the
Gang Prevention Initiative. But then the budget for '07 proposes $50
million of CCF, half of the money to go for these gang prevention
activities. And I'm sure some of the grantees -- we don't tell them what
their application has to show; we want the result, which is diversion from
gang involvement.

Q So is that -- but in terms of the amount that's given in 2006, is it more
than 2005?

DIRECTOR TOWEY: '05 didn't exist.

MR. ALLEN: It didn't exist. The program did not exist.

DIRECTOR TOWEY: He proposed that program in the State of the Union in '05.

Q Thank you.

END 3:17 P.M. EST

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