Briefing on the President's FY17 Budget Request for the U.S. Department of State and USAID

Special Briefing
Heather Higginbottom
Deputy Secretary of State for Management and Resources 
U.S. Agency for International Development (USAID) Administrator Gayle Smith
Washington, DC
February 9, 2016

MR KIRBY: Good afternoon, everybody. Today we’re going to kick off the daily briefing with a discussion of the President’s Fiscal Year ’17 budget for the State Department. I have two guest briefers here that will spend some time with you going through the big pieces of that: the Deputy Secretary for Management and Resources Heather Higginbottom is here, as well as the USAID Administrator Gayle Smith. Each of them will have a short opening statement. We’ll start with the deputy secretary, and then we’ll have time for a few questions after that, after which time we’ll get into the normal daily briefing.

I will moderate the Q&A, so please look to me if you have a question and please introduce yourself and who you’re with, your outlet, before you ask the question. And given that we’re trying to cram a lot into a briefing, I’d ask that you limit the follow-ups. Let’s give a few people a chance to get at it with questions. So with that, deputy secretary.

DEPUTY SECRETARY HIGGINBOTTOM: Good afternoon. Thank you, John, very much. As you know, earlier today President Obama released his Fiscal Year 2017 budget request to Congress. And I am pleased to be here today with my friend and colleague USAID Administrator Gayle Smith so we can present the State and USAID budget.

This request reflects the resources required to advance President Obama and Secretary Kerry’s vision for our nation’s foreign policy. It totals $50.1 billion, which is just about 1 percent of the federal budget. Just 1 percent of the federal budget supports our foreign assistance and our operations at home and abroad. As Secretary Kerry has said, American leadership isn’t just a button that you push in time of emergency; it must be backed by resources. And this 1 percent of the federal budget supports some of our nation’s most critical efforts to advance the safety, values, and prosperity of the American people.

And we are committed to efficient and effective use of these resources. Our request is aligned with the Bipartisan Budget Act passed by Congress last year, which set spending levels for Fiscal Years 2016 and 2017. The $50.1 billion request includes a base of 32 – $35.2 billion and an overseas contingency operations request of $14.9 billion.

As you know, yesterday President Obama announced an emergency funding request to prepare for and respond to the Zika virus. The Administration has requested roughly $1.8 billion in emergency funding, of which the State and USAID portion is about $375 million.

I’ll just highlight a few of our budget priorities. Our request seeks to advance security and confront new threats around the globe, including resources to fight the extremist groups of today and to prevent new terrorist organizations from gaining strength in the future. It includes $4.1 billion to degrade and destroy ISIL, intensifying pressure against the group while bolstering our partners. The funds will also help stabilize communities liberated from ISIL, assist those who have fled the conflict, and discredit terrorist propaganda.

Our request includes $953 million to support an integrated, free, and peaceful Europe, including assistance for a democratic Ukraine and to enhance energy independence and good governance for the security and prosperity of the region.

In our own hemisphere, the State/AID request includes $750 million out of a total federal budget request of a billion dollars for Central America. With these resources, we will continue to implement our strategy to address the underlying factors driving migration from the region. In Colombia, we’re requesting $400 million – an increase of $100 million above last year’s level – to act quickly to reinforce peace as the country works to end its decades-long conflict.

We are requesting $7.1 billion for assistance to Africa, which will allow us to continue to advance peace, good governance, health, and economic growth across the continent.

The budget request of $1.5 billion for the Asia Pacific region will advance our long-term strategic investment there. We’ll continue to open markets for U.S. businesses thought he Trans-Pacific Partnership as well as other efforts. And we’ll work to improve security, prosperity, and human rights across the region.

The budget calls for assistance and operations funding of $2.5 billion for Afghanistan and nearly $860 million for Pakistan to sustain our commitment to both countries, including in the fight against violent extremists.

Many of our priorities are global in nature and not limited to a single region. So we rely on regional and international organizations, such as the United Nations, to address collective challenges. Our request includes over $4.7 billion for international organizations, peacekeeping, and security sector reform efforts worldwide.

In light of the worst refugee crisis since World War II, our humanitarian assistance request of $6.2 billion reflects our commitment to help the nations carrying the biggest burdens as well as the refugees themselves.

The request includes almost $1 billion to fight climate change through the Global Climate Initiative. This includes 500 million for the Green Climate Fund, and when combined with the Department of Treasury, the Administration has requested $750 million for the Green Climate Fund, which will help developing countries leverage public and private financing to reduce carbon pollution and strengthen their resilience to the effects of climate change.

We also continue to prioritize assistance for democracy, human rights, and governance, for which we have requested $2.7 billion. And we’ve also continued to prioritize funding for global health, and our request includes robust assistance for longstanding efforts to address both HIV/AIDS and malaria.

We couldn’t support any of our foreign policy or assistance priorities without our people and our platforms. We are requesting $6.1 billion for the security and maintenance of our domestic and overseas facilities. We’ve requested $5 billion for the ongoing operations of the State Department and increased resources to tackle emerging challenges such as climate change, cybersecurity, and counterterrorism. We’ve also requested increased resources for Freedom of Information Act processing and to recruit and support a skilled and diverse workforce.

The President’s Fiscal Year 2017 budget reflects the depth and breadth of our global interests. This is an investment in the future of our nation and our leadership in the world, and we look forward to working with Congress to secure this funding. And with that, I’ll turn it over to Administrator Smith to talk about the USAID request.

ADMINISTRATOR SMITH: Thanks, Heather. Good afternoon, everybody. My thanks to the deputy secretary, who is both a friend and a great colleague in working these through.

You may know that six years ago, President Obama chose to elevate development and put it on par with defense and diplomacy. And I’m glad to say that six years later, we’ve got results that USAID is leading that effort, and in the FY ’17 budget we’ve got the resources to support it. A quick note is I think the dollars that we put in the budgets tell only part of the story in terms of our development assessments. On both the development and humanitarian sides, we use our leadership to get other countries to step up and make the contributions that they should make. As well, we are leveraging every dollar – and this is something USAID and other agencies have worked very hard on these last six years – to increase the flows of private sector assistance.

I’d like to talk about four main areas of the USAID budget. The first is fostering and sustaining the development progress we’ve seen all over the world. This includes $8.6 billion for lifesaving global health programs, where we are seeing tremendous results on reducing maternal and child deaths, moving towards an AIDS-free generation, and fighting malaria and other infectious diseases. This includes an additional $200 million for malaria; 978 million for the President’s Feed the Future food security initiative, where, again, over the last five years we’ve registered results in reducing stunting and increasing incomes; 291 million for Power Africa, which is part – USAID is the lead of an agency-wide effort to double access to electricity in Africa. This is an initiative through which we’ve mobilized $44 billion in private and public investments in support of that mission.

As Heather mentioned, the request in the second category will help us prevent, mitigate, and respond to humanitarian crises. The United States is the world’s leader in responding to crises. Heather referenced the aggregate number, which includes our refugee funding, as well as from USAID $3.4 billion that allows our men and women to respond to emergencies all over the world.

The third area is in support with our partners at State and other agencies of addressing threats to national security and global stability. Heather’s referenced some of these in Central America, Ukraine, Afghanistan, Pakistan, and others.

Finally, this request also supports the men and women of USAID to carry out their jobs, and importantly, to support what one might describe as force multipliers – the teams that do the work on technology and innovation that allow us to modernize how we approach development and reach scale, and also and importantly, the people who do the work on evidence and analysis that allow us to ensure that we’re investing our resources in the best possible way.

I think with that I will stop, and we’re ready to take your questions.

MR KIRBY: We’ll start with you, Arshad.

QUESTION: Two questions, please. Secretary Higginbottom, you noted and the fact sheet states that the humanitarian budget is 6.2 billion. Can you tell us what the comparison would be for the estimate for 2016?

DEPUTY SECRETARY HIGGINBOTTOM: Yes. So I just want to, as I answer that question, echo something that Gayle said, which is that we remain the leader of humanitarian assistance funding in the world. And President Obama and Secretary Kerry are committed to bringing more partners into this space, both with their contributions of resources and with other commitments. And Secretary Kerry spoke about that recently in Davos.

Last year, we were grateful that Congress provided a significant increase in our humanitarian assistance accounts. And combined with that increase and what we’ve requested, we feel like we’ll be prepared to respond to the crises that we face. And the specific numbers – in FY ’16, the – all the humanitarian accounts were – totaled $7.6 billion, and our request this year is $6.2 billion.

QUESTION: Do you by have chance have the actual FY ’15 number there?

DEPUTY SECRETARY HIGGINBOTTOM: I don’t have it with me, but we can get it for you no problem.

QUESTION: Great. And then one other question, which – and I just want to make sure what – I understand correctly what some of your colleagues told us earlier. Looking at the refugee and migration account, it appears as if – if you looked at expected outlays, that you’re expecting to spend about $800 million less this year than last year. What they said, if I understood it correctly, was that because you had gotten this big bump in humanitarian – in the humanitarian budget writ large for FY ’16, that you would have enough money to meet the needs.

What I don’t understand, though, is where within that 7.6 billion from last – from the current year’s humanitarian budget you’re going to be getting the money that you can then turn over to refugee and migration so that you have the money to meet the need.

DEPUTY SECRETARY HIGGINBOTTOM: So this process will – it doesn’t happen as soon as a bill is written and we sort of sit down and know exactly what we’re going to spend at what time and so forth. A big part of what’s in the humanitarian accounts is what Gayle talked about, the ability to respond to disasters. When you’re looking at the MRA account – Migration and Refugee Assistance – we’ll do some planning. Certainly our folks are doing that. They’ll look at the allocation of resources. But that process is ongoing. We received the FY ’16 budget – excuse me – appropriations bill in December, and so that analysis and work is going on. But we do make estimates about what we think we need.

And as I’m sure my colleagues have also noted, the budget, as I noted – this budget request falls in the parameters of the FY ’17 numbers, topline level that was in the Bipartisan Budget Act for both OCO and base. So we’re capped in both of those categories in how high we can go. And so we’ve balanced what we think we need in this space, in the humanitarian accounts, with what we received last year in order to meet our needs across the entire budget. So it’s balancing those priorities, as all budgets have to do.

QUESTION: So you can’t say where exactly the MRA stuff will come from?

DEPUTY SECRETARY HIGGINBOTTOM: That’s right, not at this point.

QUESTION: And then last one for me. Why, given how extensive have been the Migration and Refugee Assistance needs this year because of the huge migration flows, right, out of Syria and elsewhere – how is it that you’ve ended up with money or that you expect to have money left over at the end of FY ’16 that you then apply to FY ’17?

DEPUTY SECRETARY HIGGINBOTTOM: It is the case that we have had some carryover funds in the past as well, and we look at what we can get out at certain points and what we think the needs are. And it’s not an uncommon phenomenon in this space. And for the last several years, we’ve actually had carryover funds to do that. But I think what’s really important and the way the Administration has approached this is we’re not going to be in a situation year after year after year to continue to lead the entire world in this space. We have to bring other partners into this, and that’s a big part of what we’re focused on this year.

Gayle, sorry.

QUESTION: Thank you.

ADMINISTRATOR SMITH: Yeah, I would just reiterate that there are several other things we do to manage where the numbers come out. One is provide assistance to people in need before they become refugees, and including in the hopes they will not have the need to flee. So that’s number one. Number two, and this has been a very aggressive push, particularly in the last couple years – we did it in Ebola; we’re doing it now in El Nino, which is proving to be a huge potential crisis in a number of regions – is deliberately enlist support from others. We are overwhelmingly the leading donor. I think we’re quite prepared to lead, but I think we’re very aggressive in ensuring that the burden is shared.

QUESTION: Justin Arnold, Yomiuri Shimbun. You mentioned 1.5 billion for the Asia Pacific rebalance, and part of that was for TPP. Can you go a little bit deeper – what is that going to be used for? Is it advocacy?

DEPUTY SECRETARY HIGGINBOTTOM: So the total – the sum total of the request for the Asia Pacific region will cover a number of different activities. Some of the increase will be for TPP implementation. Maritime security is another area, particularly with issues around the South China Sea, of interest. And if you look in our materials, you can go through some of the others. We have human rights programming, we have a series of different programs. But some of that increase over last year will be towards TPP implementation and maritime security.

QUESTION: Thank you.

QUESTION: On foreign aids, do you have specific numbers regarding Israel, Egypt, Iraq, and Lebanon?


QUESTION: Please, thank you.

DEPUTY SECRETARY HIGGINBOTTOM: So Iraq, our foreign assistance is $1.8 billion. Yeah – does that include operating, too? That’s combined in our operating assistance as well. We’ll get you the breakdown for foreign assistance. We do have it. Israel’s --

QUESTION: (Inaudible) the comparisons for the prior years when you get us that?


QUESTION: Thank you, yeah.


QUESTION: Egypt, Israel.

DEPUTY SECRETARY HIGGINBOTTOM: Egypt is $1.5 billion of assistance. Israel is 3.1 billion. Jordan is a billion. And did you have another country?

QUESTION: Lebanon?

DEPUTY SECRETARY HIGGINBOTTOM: Lebanon is 233.5 million. And we would be happy to provide you with a comparison to prior years. We don’t have all the allocations done for FY ’16 yet because that process takes a little while. As I noted, we just got the bill in December; allocation per country takes a while. We’ll give you the best information we have now.

QUESTION: Thank you.

MR KIRBY: Any more? Okay. Thank you very much, everybody.