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APN Legislative Round-Up - July 14, 2006

I. Congress responds to kidnappings II. Senate FY07 ForOps - details

APN Legislative Round-Up for the week ending July 14, 2006

I. Congress responds to kidnappings
II. Senate FY07 ForOps - details

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I. CONGRESS RESPONDS TO KIDNAPPINGS
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Resolutions are circulating in both the House and Senate condemning the kidnapping of Israeli soldiers by Hamas and Hizballah, asserting Israel's right to self-defense, and reiterating U.S. support for Israel.

Action is expected on both resolutions early next week.

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II. SENATE FY07 FOROPS - DETAILS
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As noted in the June 30th edition of the Round-Up, in their version of the FY07 ForOps bill, Senate appropriators significantly restructured many aspects of the bill. This has impacted the way funds are allocated in the bill, reflecting an apparent effort to "rationalize" funding by moving away from providing "general use" economic aid (often accompanied by guidance on how it should be spent), and instead providing funds as part of a specific category related to their intended use (Israel is not impacted by this change, since economic aid to Israel is provided as lump-sum cash assistance, not linked to any specific program or use).

As a result of these changes, it is more difficult than in the past to directly compare the House and Senate versions of the bill. The summary provided below presents the Middle East-related items in the order in which they appear in the Senate bill.

[Note: The June 30th edition of the Round- Up, produced before the full bill and report text were available, included most of the major Middle East-related items in the bill, but omitted many details and items. In the interests of providing a full picture of what the bill contains, that information is repeated here, along with other Middle East related details of the bill.]

Key to acronyms:

>ESF (Economic Support Funds). This is the traditional funding category for non- military assistance to countries of the Middle East. According to USAID, ESF, "supports U.S. foreign policy objectives by providing economic assistance to allies and countries in transition to democracy, supporting Middle East peace negotiations, and financing economic stabilization programs." http://www.usaid.gov/policy/budget/cbj2007/a n/esf.html

>DA (Development Assistance). According to USAID, DA programs "promote economic opportunity, support just governance, and invest in people through education..." (http://www.usaid.gov/policy/budget/cbj2007/ an/)

> CSHPR: (Child Survival and Health Programs Fund). According to USAID, CSHPR programs "address critical health, HIV/AIDS, nutrition and family planning needs worldwide..." (http://www.usaid.gov/policy/budget/cbj2007/ an/csh.html)

>DF (Democracy Fund): Funding for programs for democracy, human rights, and governance.

>IMET (International Military Education and Training). Programs that bring foreign military officers to the U.S. for training.

>MRA (Migration and Refugee Assistance).

>NADR (Nonproliferation, Anti-Terrorism, Demining).

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A. BILL TEXT
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- Israeli Arab Scholarship Program: The bill authorizes that interest and earnings accruing to the Israeli Arab Scholarship fund as of Sept. 30, 2007 be used for expenses of the Program, to remain available until expended.

- Sec. 111: A new provision (which has already be passed into law by Congress numerous times but set aside as unconstitutional by the President) stipulating that for the purposes of birth certificates, passports, and certificates of nationality, the birthplace of those born in Jerusalem shall be stated as Israel (rather than simply "Jerusalem"), upon request of the citizen in question.

- Sec. 114: A perennial provision barring assistance to the Palestinian Broadcasting Corporation.

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- ESF:

ISRAEL: The bill stipulates that not less than $120 million in ESF shall be made available only for Israel, to be provided as a cash transfer disbursed within 30 days of the Act becoming law (as is usual practice with respect to aid for Israel).

LEBANON: The bill stipulates that not less than $6 million of the ESF funds appropriated for Lebanon be made available for scholarships and direct support of American educational institutions in Lebanon (the bill does not stipulate the total amount provided for Lebanon).

EGYPT: No mention.

JORDAN: No mention.

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- DF:

MUSLIMS (outside the Middle East): The bill stipulates that "assistance shall be made available for programs and activities promoting democracy in countries outside the Middle East with predominately Muslim populations

MUSLIMS (INCLUDING THE MIDDLE EAST): The bill stipulates that $5 million be used for programs utilizing Indonesian leaders to reduce the appeal of religious extremism in Islamic communities in Indonesia and other Islamic countries, including in the Middle East.

SYRIA: The bill stipulates that not less than $1.5 million be made available for programs that support the advancement of democracy in Syria.

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- MRA:

ISRAEL: The bill stipulates that not less than $40 million of the funds available under this heading be made available for refugees resettling in Israel.

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- FMF:

ISRAEL: The bill stipulates that not less than $2.34 billion be made available for grants only for Israel, to be disbursed (per usual practice with respect to Israel) within 30 days of the Act becoming law. The bill also stipulates that of these funds, not less that $610 million shall be available for procurements in Israel (i.e. the funds do not have to be spent in the U.S., per normal practice).

JORDAN: The bill stipulates that $206 million shall be available for assistance to Jordan.

EGYPT: No mention.

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- Sec. 506: Perennial prohibition on taxation of United States assistance. While this provision appears generic (applying to all countries/entities receiving US aid) the only country/entity explicitly identified is the West Bank and Gaza. This reflects the genesis of this now perennial provision - the allegation in a previous year that the Palestinian Authority (PA) was taxing U.S. assistance provided to NGOs, thereby indirectly benefiting from US assistance designed specifically to bypass the PA.

- Sec. 507: Perennial prohibition on funding for certain countries, including Iran and Syria. The ban extends to loans, credits, and guarantees of the Export-Import Bank.

- Sec. 510: Commercial Leasing of Defense Articles. This perennial provision permits financing to be provided to Israel, Egypt and NATO and major non-NATO allies for the procurement by leasing (including leasing with an option to purchase) of defense articles from United States commercial suppliers, if the President determines that there are compelling foreign policy or national security reasons for those defense articles being provided by commercial lease rather than by government-to-government sale.

- Sec. 527: Perennial bill language prohibiting aid to any country which the President determines grants sanctuary to any individual or group that has committed an act of international terrorism, or any country that the President determines otherwise supports international terrorism. Provides the President the ability to waive the ban for national security or humanitarian reasons.

- Sec. 534 (j): Stipulates that of the ESF funds made available under this act for the Middle East Partnership Initiative, up to $35 million may be made available to establish and operate a Middle East Foundation, or any similar entity, whose purpose is to promote democracy, governance, human rights and the rule of law, as well as private enterprise development in the Middle East (similar to language in the House version).

- Sec. 535: Perennial provision condemning the Arab League boycott of Israel.

- Sec. 541: This provision bars aid to NGOs that fail "to provide upon timely request any document, file, or record necessary to the auditing requirements of the United States Agency for International Development." While this is a generic requirement, applying to all NGOs receiving US funds, the issue of audits of NGOs working with USAID has been especially focused on the West Bank and Gaza.

- Sec. 542: Bill language banning assistance to governments that export lethal military equipment to countries supporting international terrorism.

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- Sec. 547: Assistance for Egypt: This is a brand-new section consolidating several different Egypt-related elements in the bill and representing a paradigm shift in the U.S.-Egypt aid relationship (which has its roots in the Camp David Accord, and has thus historically been linked, informally, to U.S. assistance to Israel). As a result of the change, assistance to Egypt is strictly categorized and may only be used for specific purposes.

ESF: The bill stipulates that up to $310,827,000 should be made available for assistance to Egypt. The bill also stipulates that these funds may be available as cash transfer assistance ONLY for the purpose of supporting Egyptian implementation of significant economic and political reforms which are additional to those undertaken in previous fiscal years, and ONLY if the Secretary of States determines that the U.S. and Egypt have entered into a written agreement establishing benchmarks which demonstrate implementation during fiscal year 2007 of significant and additional economic and political reforms, and that all of those benchmarks have been met. In addition, the bill stipulates that the Secretary of State may reprogram these funds at any time (i.e., take them away from Egypt and use them for something else), and that if the Secretary cannot make the required determination by September 30, 2007, the funds SHALL be reprogrammed for some other purpose (rather than carried over until the determination can be made, as has been past practice).

"Project Assistance": The bill stipulates that of the funds appropriated under the heading "Development Assistance," not less than $44,572,000 shall be made available for assistance for Egypt for education programs.

"Democracy Fund": The bill stipulates that not less than $86,455,000 of the funds appropriated under the heading "Democracy Fund" shall be made available for assistance for Egypt for democracy, human rights, and governance programs. The bill also stipulates (as it has in recent years) that organizations implementing said programs shall not be subject to the prior approval of the Government of Egypt.

FMF: The bill includes perennial language requiring that current year estimated outlays (i.e., FMF funds for Egypt expected to be spent this fiscal year) be transferred to an interest-bearing account within 30 days of this Act becoming law.

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- Sec. 548: Perennial bill language (first inserted in the FY03 ForOps bill) stipulating that no funds appropriated in this Act may be used to support a Palestinian state unless the Secretary of State certifies the state has met a list of requirements related to fighting terror, democratic reform, and commitment to peace. As in the previous year, the President is granted the authority to waive these requirements for reasons of national security.

- Sec. 549: Perennial bill language stipulating that no funds appropriated in this Act may be used to create any U.S. government office in Jerusalem to conduct business with the Palestinian Authority or any successor Palestinian governing entity. Includes a national security waiver.

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- Sec. 550: This section consolidates in one place several perennial sections and some new language prohibiting, conditioning, and restricting U.S. relations with the PLO and the Palestinian Authority. These include:

> a perennial limitation on assistance to the PLO;

> new language (similar to language included in the FY06 Supplemental Appropriations bill) barring assistance to the PA unless the Secretary of State determines that the PA has met the Quartet requirements - is committed to non-violence, recognizes Israel, and accepts previous agreements. The section includes limited Presidential waiver authority with respect to assistance for the Office of the President of the PA.

> redundant language (included also at the beginning of the bill) barring assistance to the Palestinian Broadcasting Corporation;

>language stipulating requirements for oversight, vetting, and audits of assistance for the West Bank and Gaza, and prohibiting assistance for the purposes of honoring individuals who commit or have committed acts of terror.

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- Sec. 574: This section enumerates rescissions included in the bill (i.e., cases where the Committee is rescinding - taking back - funds previously appropriated for some purpose but not yet expended). Under this section, the bill rescinds $75 million in ESF funds previously appropriated for assistance for the West Bank and Gaza, and $200 million in ESF funds previously appropriated for assistance for Egypt.

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B. REPORT LANGUAGE
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The report accompanying the bill text breaks down the bill provisions by country, providing detailed aid tables for each country, as well as text explaining the Committee's intent.

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Egypt
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CSHPF: $22,146,000 DA: $44,572,000 ESF: $301,827,000 DF: $86,455,000 FMF: $1,300,000,000 IMET: $1,235,000 NADR: $1,860,000 Total: $1,758,095,000

The report notes that the level of funding provided by the Committee is the same as the level requested by the President, and that the categories reflect the appropriate funding accounts. In addition to reiterating the restrictions on cash transfer assistance included in the bill text, the report notes that the Committee remains "concerned with the lack of political reform in Egypt and the incarceration of secularist politicians, including Ayman Nour. The Committee believes the State Department should be far more vocal in publicly condemning human rights abuses in Egypt." The report also directs the State Department to submit a report regarding the Government of Egypt's harassment of and discrimination against Egyptians who have converted to another religion.

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Israel
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ESF: $120,000,000 FMF: $2,340,000,000 NADR: $320,000 Total: $2,460,320,000

The report notes that the funding is identical to what was requested by the President. The report notes that the Committee supports the request for $40 million under the MRA account (not included in the table), and states that with the ongoing decrease in humanitarian migrants to Israel, the Committee expects this amount to decrease by $5 million in FY09, and $10 million in FY10.

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Jordan
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CSHPF: $17,000,000 DA: $34,000,000 ESF: $182,000,000 DF: $12,000,000 FMF: $206,000,000 IMET: $3,060,000 NARD: $1,641,000 Peace Corps: $1,614,000 Total: $457,315,000

The report notes that the Committee "recognizes and appreciates the contributions of Jordan in the global war on terror. The Committee encourages the administration to request additional ESF and FMF assistance for Jordan in future supplemental appropriations acts."

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Lebanon
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DA: $300,000 ESF: $25,200,000 DF: $15,000,000 FMF: $4,800,000 IMET: $935,000 NADR: $2,000,000 Total: $48,235,000

The report notes that the Committee is recommending a total of $5 million over the President's budget request (included in the funds for DF). The report language notes that the Committee, "recognizes the opportunity to strengthen democracy and rule of law in Lebanon, and recommends $15,000,000 under the DF for programs and activities for these purposes. The Committee encourages the State Department to develop a comprehensive strategy for the advancement of democracy and security in Lebanon, which, if properly implemented, could serve to blunt Syrian influence in that country..." The Senate also requires the Secretary of State, in consultation with the Secretary of Defense, to submit a report to Congress on "U.S. policy and objectives in Lebanon (to include the disarming of Hizbollah, the expansion of the Lebanese army to the southern part of that country, and the protection of Lebanon's eastern border)."

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West Bank and Gaza
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ESF: $25,000,000

This is $125 million less than requested by the President, and $25 million more than provided by the House (which specifically stipulated that none of the funds appropriated under this Act may be made available for assistance for the West Bank and Gaza). Of this amount, the report notes that the Committee recommends that $5 million go to the Holy Family Hospital in Bethlehem.

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Other Report Language
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- Under "Contributions for International Peacekeeping Activities," the report includes a table showing full funding of the President's request for the UN Disengagement Observer Force on the Golan Heights ($11,241,000) and the UN Interim Force in Lebanon ($24,228,000).

- Under "Center for Middle Eastern-Western Dialogue," the report notes that the Committee recommends $750,000 for the Dialogue's Trust Fund.

- Under "International Broadcasting Operations," the report includes a table showing full funding ($89,804,000) for Middle East Broadcasting Networks.

- Under "Child Survival and Maternal Health," (funds for which are included under various funding categories) the report includes a table detailing funding provided for programs around the world, including for Egypt ($6,519,000), Jordan ($6,500,000) and Yemen ($2,300,000).

- Under "Family Planning/Reproductive Health," (funds for which are included under various funding categories), the report includes a table detailing funding provided for programs around the world, including for Egypt ($13,017,000), Jordan ($10,000,000) and Yemen ($2,383,000).

- Under "HIV/AIDS," (funds for which are included under various funding categories), the report includes a table detailing funding provided for programs around the world, including for Egypt ($1,488,000) and Jordan ($500,000).

- Under "Other Infectious Diseases," (funds for which are included under various funding categories), the report includes a table detailing funding provided for programs around the world, including for Egypt ($1,122,000).

- Under "American Schools and Hospitals Abroad" the report notes that the Committee "continues to be impressed with the contributions to United States interests made by several institutions and believes they warrant consideration for further ASHA support." The Committee lists a number of institutions around the world, including the Lebanese American University, the Hadassah Medical Organization, the American University of Beirut, and the Feinberg Graduate School of the Weizmann Institute of Science.

- Under "Basic Education," (funds for which are included under various funding categories), the report includes a table detailing funding provided for programs around the world, including for Egypt ($44,572,000), Jordan ($34,000,000), Lebanon ($300,000), Morocco ($5,400,000) and Yemen ($5,319,000).

- Under "Economic Support Funds," (funds for which are included under various funding categories), the report includes a table detailing funding provided for programs around the world, including:

Egypt: $301,827,000 Israel: $120,000,000 Jordan: $182,000,000 Lebanon: $25,200,000 Middle East Multilaterals: $1,000,000 Middle East Partnership Initiative (MEPI): $75,000,000 Middle East Regional Cooperation: $500,000 Morocco: $3,000,000 West Bank/Gaza: $25,000,000 Yemen: $0 Reconciliation Programs (Global): $20,000,000

With respect to MEPI, the report notes that Committee recommendation is $45 million less than the President's request. Of the amount provided, $9 million is for scholarship programs at institutions not controlled by the government of the country where they are located, and recognized by the U.S. Department of Education - including the American University of Beirut, the American University of Cairo, and the Lebanese American University. The Committee also "encourages the State Department to consider a proposal from the Manachem [sic] Begin Center to advance peace through educational outreach activities to key Israeli and demographic sectors, enhanced Arab-Israeli contacts and exchanges, and reconciliation programs."

With respect to Reconciliation Programs, the report lists some organizations that the Committee believes "are among those deserving consideration for support." These include:

>The Arava Institute for Environmental Studies >Seeds of Peace >Facing History and Ourselves >Middle East People-to-People Coexistence Program >Interns for Peace

With respect to the West Bank and Gaza program, the report notes that the Committee "continues to support the First Regional Cooperative Program for Health to be conducted by the Hebrew University's Kuvin Center and Al Quds University."

- Under "Democracy Funds," (funds for which are included under various funding categories), the report includes a table detailing funding provided for programs around the world, including Egypt ($86,455,000), Jordan ($12,000,000), Lebanon ($15,000,000), Syria ($1,500,000), Morocco ($5,000,000) and Yemen ($1,998,000).

- Under "Migration and Refugee Assistance" the table lists the Near East as receiving $113,325,000 (of which $40,000,000 is earmarked in the bill text for Israel). The report notes that "...as the Magen David Adom Society of Israel has been accorded membership in the International Red Cross and Red Crescent Movement, restrictions on a headquarters contribution to the International Committee of the Red Cross are not continued."

- Under "Foreign Military Financing" the table lists funding for Israel ($2,340,000,000), Jordan ($206,000,000) and Egypt ($1,300,000,000).

For more information, visit the APN web site at www.peacenow.org or contact APN Government Relations Director Lara Friedman at 202/728-1893, or at lfriedman@peacenow.org.