[Senate Report 114-393]
[From the U.S. Government Publishing Office]
Calendar No. 703
114th Congress } { Report
2d Session } SENATE { 114-393
_______________________________________________________________________
SELECTUSA AUTHORIZATION ACT OF 2016
__________
R E P O R T
of the
COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
on
S. 3097
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
December 6, 2016.--Ordered to be printed
___________
U.S. GOVERNMENT PUBLISHING OFFICE
WASHINGTON : 2016
SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
one hundred fourteenth congress
second session
JOHN THUNE, South Dakota, Chairman
ROGER F. WICKER, Mississippi BILL NELSON, Florida
ROY BLUNT, Missouri MARIA CANTWELL, Washington
MARCO RUBIO, Florida CLAIRE McCASKILL, Missouri
KELLY AYOTTE, New Hampshire AMY KLOBUCHAR, Minnesota
TED CRUZ, Texas RICHARD BLUMENTHAL, Connecticut
DEB FISCHER, Nebraska BRIAN SCHATZ, Hawaii
JERRY MORAN, Kansas ED MARKEY, Massachusetts
DAN SULLIVAN, Alaska CORY BOOKER, New Jersey
RON JOHNSON, Wisconsin TOM UDALL, New Mexico
DEAN HELLER, Nevada JOE MANCHIN, West Virginia
CORY GARDNER, Colorado GARY PETERS, Michigan
STEVE DAINES, Montana
Nick Rossi, Staff Director
Adrian Arnakis, Deputy Staff Director
Jason Van Beek, General Counsel
Kim Lipsky, Democratic Staff Director
Christopher Day, Democratic Deputy Staff Director
Clint Odom, Democratic General Counsel
Calendar No. 703
114th Congress } { Report
SENATE
2d Session } { 114-393
======================================================================
SELECTUSA AUTHORIZATION ACT OF 2016
_______
December 6, 2016.--Ordered to be printed
_______
Mr. Thune, from the Committee on Commerce, Science, and Transportation,
submitted the following
R E P O R T
[To accompany S. 3097]
The Committee on Commerce, Science, and Transportation, to
which was referred the bill (S. 3097) to establish the
SelectUSA program, and for other purposes, having considered
the same, reports favorably thereon with an amendment (in the
nature of a substitute) and recommends that the bill (as
amended) do pass.
Purpose of the Bill
The purpose of S. 3097 is to authorize an existing program
within the International Trade Administration (ITA) at the
Department of Commerce known as the SelectUSA program. And in
response to an investigation by the Office of Inspector General
of the Department of Commerce that revealed travel and other
improprieties by the former Under Secretary for International
Trade, Stefan Selig, the purpose also is to require newly
appointed political appointees of the Department of Commerce to
undergo training on official travel and office renovation
policies. The SelectUSA program would continue to coordinate
investment-related resources across more than 20 Federal
agencies and operate as a partner to State and local economic
development efforts to promote the United States as the best
market for investment in the world. S. 3097 would codify the
structure, missions, and functions of the SelectUSA program,
among other things.
Background and Needs
On June 15, 2011, President Obama issued Executive Order
13577, which established SelectUSA, an initiative to attract
more foreign direct investment (FDI) in the United States.\1\
According to the Obama Administration, the Federal Government
lacked the centralized investment promotion infrastructure and
resources to attract business investment that is often found in
other industrialized countries.
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\1\Exec. Order No. 13577, at https://www.whitehouse.gov/the-press-
office/2011/06/15/executive-order-13577-selectusa-initiative.
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SelectUSA is housed within ITA at the Department of
Commerce. The aim of SelectUSA is to make attracting FDI as
important a component of U.S. foreign policy as promoting
exports.\2\ SelectUSA has designated global teams led by U.S.
ambassadors in 32 key countries to encourage foreign investment
into the United States and has established a ``coordinated
process'' to connect prospective investors with senior U.S.
officials.\3\ SelectUSA offers a number of tools for foreign
investors looking to invest in the United States, including a
list of various State and Federal programs that may be
available to foreign investors.\4\
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\2\Congressional Research Service Report RS21857, Foreign Direct
Investment in the United States: An Economic Analysis, by James K.
Jackson.
\3\Ibid.
\4\Ibid.
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Although the United States is the leading single
destination of FDI, it faces competition from other
industrialized economies, as well as developing economies. In
2014, the share of worldwide investment in the United States
dropped to 21 percent, down from 39 percent in 2000.\5\ Today,
virtually every economy in the world has a national institution
dedicated to investment promotion. S. 3097 would respond to the
need for a sustained and concerted effort to bring the United
States closer to the level of investment promotion agencies of
other nations that are competing for job-creating business
investment in the global economy.
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\5\Organization for International Investment, Foreign Direct
Investment in the United States, 2016, at http://ofii. org/sites/
default/ files/Foreign %20 Direct% 20Investment %20in% 20the% 20United%
20States% 202016%20Report.pdf.
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SelectUSA's mission is to facilitate job-creating business
investment into the United States and raise awareness of the
critical role that FDI plays in the U.S. economy.\6\ The
initiative helps companies of all sizes: find the information
they need to make decisions; connect to the right people at the
local level; and navigate the Federal regulatory system.\7\
According to its website, since its inception, SelectUSA has
facilitated over $23 billion in investment for the United
States and will provide services to nearly 1,000 investors and
economic development organizations.\8\
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\6\About SelectUSA, last visited Oct. 7, 2016, https://www.
selectusa. gov/about-selectusa.
\7\Ibid.
\8\Ibid.
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SelectUSA's current executive director is Vinai
Thummalapally, a former U.S. ambassador to Belize, who
coordinates activities both within the Department of Commerce
and with other Executive departments and agencies that have
activities relating to business investment decisions.
The Executive Order establishing SelectUSA requires the
Department of Commerce to provide funding and administrative
support through resources and staff to the extent permitted by
law and within existing appropriations. The Executive Order
also established the Federal Interagency Investment Working
Group (Working Group), which is convened and chaired by the
executive director of SelectUSA, in coordination with the
Director of the National Economic Council. The Working Group
consists of senior officials from the Treasury, Department of
State, Department of Defense, Department of Justice, Department
of the Interior, Department of Agriculture, Department of
Commerce, Department of Labor, Department of Veterans Affairs,
Department of Health and Human Services, Department of Housing
and Urban Development, Department of Transportation, Department
of Energy, Department of Education, Department of Homeland
Security, Environmental Protection Agency, Small Business
Administration, Export-Import Bank of the United States, Office
of the U.S. Trade Representative, Domestic Policy Council,
National Economic Council, National Security Staff, Office of
Management and Budget, and Council of Economic Advisers. The
Working Group coordinates activities to promote business
investment and respond to specific issues that affect business
decisions. The Department of Commerce provides funding and
administrative support for the Working Group to the extent
permitted by law and within existing appropriations.
Summary of Provisions
S. 3097 would authorize an existing program within the ITA
at the Department of Commerce known as the SelectUSA program.
Launched by the Obama Administration on June 15, 2011,\9\ the
SelectUSA program currently coordinates investment-related
resources across more than 20 Federal agencies and operates as
a partner to State and local economic development efforts to
promote the United States as the best market for investment in
the world. S. 3097 would, among other things: establish the
position of Executive Director for the SelectUSA program; set
forth the mission and functions of SelectUSA; and establish a
Federal Interagency Investment Working Group comprised of
senior officials from relevant agencies that would coordinate
activities to promote business investment.
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\9\Exec. Order No. 13577, 2011.
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In fiscal year (FY) 2016, SelectUSA received funding of $10
million within the amount appropriated for ITA. For FY 2017,
ITA requested $20 million for SelectUSA, a $10 million
increase.\10\ S. 3097 would authorize $15 million for SelectUSA
for each of FYs 2017 through 2021.
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\10\Department of Commerce, International Trade Administration
Budget Estimates, Fiscal Year 2017, Congressional Submission, 2016, at
http://www. osec. doc.gov/bmi/ budget/FY17CBJ/ ITA% 20FY% 202017%
20CBJ%20 Final% 20not 508.pdf.
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Legislative History
S. 3907 was introduced on June 23, 2016, by Senator Schatz
and was referred to the Committee on Commerce, Science, and
Transportation of the Senate. The bill is cosponsored by
Senators Nelson, Heller, and Coons. On September 21, 2016, the
Committee met in open Executive Session and, by voice vote,
ordered S. 3097 to be reported with an amendment (in the nature
of a substitute).
Senators Rubio, Cruz, and Fischer requested to be recorded
in opposition to S. 3097. The Committee approved an amendment
by Senator Thune, which was cosponsored by Senators Heller,
Johnson, and Ayotte, that sets forth training requirements for
political appointees of the Department of Commerce, which were
originally recommended by the Inspector General of the
Department of Commerce after an investigation revealed travel
and other improprieties by the former Under Secretary of
Commerce for International Trade, Stefan Selig.\11\
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\11\Investigation into Travel & Other Improprieties in the Office
of a Politically Appointed Official, Inv. No. 15-044, Dep't of
Commerce, September 2016, (Final), at https://www. oig. doc.gov/
OIGPublications/ 15-0444.pdf.
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Estimated Costs
In accordance with paragraph 11(a) of rule XXVI of the
Standing Rules of the Senate and section 403 of the
Congressional Budget Act of 1974, the Committee provides the
following cost estimate, prepared by the Congressional Budget
Office:
S. 3097--SelectUSA Authorization Act of 2016
Summary: S. 3097 would establish the SelectUSA program
within the Department of Commerce (DOC) to facilitate business
investment in the United States. The bill would authorize the
appropriation of $15 million a year over the 2017-2021 period
for the operation of that program. S. 3097 would direct DOC to
annually certify that its employees who are political
appointees have received training on various government
policies. The bill also would require DOC to issue reports on
certain government office renovations and steps the department
has taken to empower whistleblowing. Lastly, the bill would
require the Government Accountability Office (GAO) to submit a
report to the Congress with recommendations on the
effectiveness of the SelectUSA program.
CBO estimates that implementing this bill would cost $67
million over the 2017-2021 period, assuming appropriation of
the authorized amounts. Enacting S. 3097 would not affect
direct spending or revenues; therefore, pay-as-you-go
procedures do not apply.
CBO estimates that enacting S. 3097 would not increase net
direct spending or on-budget deficits in any of the four
consecutive 10-year periods beginning in 2027.
S. 3097 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA)
and would impose no costs on state, local, or tribal
governments.
Estimated cost to the Federal Government: The estimated
budgetary effect of S. 3097 is shown in the following table.
The costs of this legislation fall within budget function 370
(commerce and housing credit).
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By fiscal year, in millions of dollars--
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2017 2018 2019 2020 2021 2017-2021
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INCREASES IN SPENDING SUBJECT TO APPROPRIATION
Estimated Authorization Level................................ 15 15 15 15 15 75
Estimated Outlays............................................ 8 14 15 15 15 67
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Basis of estimate: For this estimate, CBO assumes that the
bill will be enacted by the end of calendar year 2016, that the
authorized amounts will be appropriated each year, and that
outlays will follow the historical rate of spending for this
program.
S. 3097 would authorize the appropriation of $15 million
annually over the 2017-2021 period for DOC to implement the
SelectUSA program. The SelectUSA program was established in
2011 and is currently operated by the International Trade
Administration within DOC. The program's budget was $10 million
in 2016. Based on an analysis of information from DOC, CBO
estimates that implementing S. 3097 would cost $67 million over
the 2017-2021 period for the operations of the SelectUSA
program, assuming appropriations of the specified amounts. The
reporting and certification requirements would cost less than
$500,000 each year. Based on the costs of similar reports
conducted by GAO, CBO estimates that the increased costs to GAO
to conduct a study and issue a report on the SelectUSA program
would be insignificant.
Pay-As-You-Go considerations: None.
Increase in long-term direct spending and deficits: CBO
estimates that enacting S. 3097 would not increase net direct
spending or on-budget deficits in any of the four consecutive
10-year periods beginning in 2027.
Intergovernmental and private-sector impact: S. 3097
contains no intergovernmental or private-sector mandates as
defined in UMRA and would impose no costs on state, local, or
tribal governments.
Estimate prepared by: Federal costs: Stephen Rabent; Impact
on state, local, and tribal governments: Rachel Austin; Impact
on the private sector: Logan Smith.
Estimated approved by: H. Samuel Papenfuss, Deputy
Assistant Director for Budget Analysis.
Regulatory Impact
In accordance with paragraph 11(b) of rule XXVI of the
Standing Rules of the Senate, the Committee provides the
following evaluation of the regulatory impact of the
legislation, as reported:
number of persons covered
A key measure of the number of persons covered by
authorizing a program that encourages FDI is the number of
people in the United States who are directly employed by U.S.
affiliates of international companies.\12\ As of 2014, the most
recent data available, nearly 6.4 million people in the United
States were directly employed by U.S. affiliates of
international companies. These U.S. affiliates account for more
than one-quarter of U.S. goods exported and spent $57 billion
on U.S. research and development that year.\13\
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\12\Letter from Department of Commerce General Counsel, Kelly R.
Welsh, to Chairman John Thune, U.S. Senate Commerce, Science &
Transportation Committee, 2016, at https://ogc.commerce.gov/sites/
ogc.commerce.gov/files/media/files/2016/
selectusa_authorization_act_of_2016.pdf.
\13\Ibid.
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economic impact
Section 2 of the bill would provide that the mission of
SelectUSA is to facilitate business investment in the United
States in order to create jobs, spur economic growth, and
promote U.S. competitiveness. FDI helps drive economic growth,
job creation, innovation, and exports. The activities of the
SelectUSA program would contribute to the stock of FDI in the
United States, which was $2.9 trillion on a historical-cost
basis in 2014.\14\
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\14\Department of Commerce, Economics & Statistics Administration,
Foreign Direct Investment in the United States: Update to 2013 Report,
June 20, 2016, at http://esa.gov/reports/foreign-direct-investment-
united-states-update-2013-report.
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privacy
S. 3907 would not have any adverse impact on the personal
privacy of individuals.
paperwork
The bill would not increase paperwork requirements for
private individuals or businesses. The bill would require
several reports and notifications from the Federal Government.
Section 4 of the bill would require annual reports and
notifications to Congress on SelectUSA's activities during the
preceding FY. Section 5 of the bill would require an assessment
by the Government Accountability Office of the effectiveness of
SelectUSA in increasing, encouraging, and supporting FDI in the
United States.
Section 6 of the bill would require the Secretary of
Commerce, at the beginning of each FY, to certify to Congress
that each newly appointed political official of the Department
of Commerce has received training on key regulations and
policies governing official travel, among other things, as well
as a report on renovations to the office suite of the Under
Secretary for International Trade not later than 30 days after
the date of enactment of the Act. S. 3097 also would require
the Secretary of Commerce to submit a report to Congress on the
steps the Secretary has taken to encourage whistleblowing by
subordinates who observe instances of potential regulatory,
policy, or rule violations.
Congressionally Directed Spending
In compliance with paragraph 4(b) of rule XLIV of the
Standing Rules of the Senate, the Committee provides that no
provisions contained in the bill, as reported, meet the
definition of congressionally directed spending items under the
rule.
Section-by-Section Analysis
Section 1. Short title.
This section would provide that the Act may be cited as the
``SelectUSA Authorization Act of 2016''.
Section 2. Establishment of SelectUSA.
This section would establish in the Department of Commerce
the SelectUSA program as a ``Government-wide program to attract
and retain investment in the United States economy.'' It also
would direct the Secretary of Commerce to designate a senior
staff member to be the executive director of SelectUSA, who
shall coordinate activities relating to business investment
decisions within the Department of Commerce and with other
Federal agencies with responsibility for such activities.
This section would set forth the mission of SelectUSA as
facilitating business investment in the United States in order
to create jobs, spur economic growth, and promote U.S.
competitiveness, among other things. It also would set forth
the functions of SelectUSA, which would be to coordinate
outreach and engagement by the Federal Government to promote
the United States as the premiere location to operate a
business, and to endeavor to coordinate and avoid duplication
with other Federal agencies, among other things. This section
also would require SelectUSA to report periodically to the
President, through the National Economic Council, the Domestic
Policy Council, and the National Security Staff, on outreach
activities of SelectUSA.
This section also would emphasize increased opportunities
for rural areas and smaller States, requiring SelectUSA to
endeavor to increase FDI opportunities in such areas. Among
other things, it would require SelectUSA to endeavor to hold
conferences and events in rural areas and smaller States, when
practicable.
Lastly, this section would require all Federal agencies
with responsibility for activities relating to business
investment decisions to cooperate with SelectUSA, as requested
by the executive director, to support the objectives of
SelectUSA.
Section 3. Federal Interagency Investment Working Group.
This section would establish the Federal Interagency
Investment Working Group, referred to as the ``Working Group,''
which would be convened and chaired by the executive director
of SelectUSA, in coordination with the Director of the National
Economic Council. The Working Group would consist of senior
officials from agencies represented on the Trade Promotion
Coordinating Committee, an interagency committee established
under the Export Enhancement Act of 1992 (Public Law 102-429;
106 Stat. 2186) to provide a unifying framework to coordinate
the export promotion and export financing activities of the
U.S. Government.\15\ The functions of the Working Group would
be to coordinate activities to promote business investment and
respond to specific issues that affect business investment
decisions.
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\15\The Trade Promotion Coordinating Committee, Helping U.S.
Companies Export, last visited Oct. 7, 2016, at http://2016.export.gov/
advocacy/eg.
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Section 4. Reports and notifications to Congress.
This section would require that, not later than December 31
of each year, the Secretary of Commerce submit to Congress a
report on the activities of SelectUSA during the preceding FY.
The report would be required to include a description of the
outreach activities of SelectUSA, a statement of the funds used
by SelectUSA, and an assessment of the number of foreign firms
that located in the United States using the services provided
by SelectUSA, among other things.
Section 5. Government Accountability Office assessment of effectiveness
of SelectUSA.
This section would require the Comptroller General to
submit to Congress, not later than 1 year after the date of
enactment, a report assessing the effectiveness of SelectUSA in
increasing, encouraging, and supporting FDI in the United
States. The report would be required to include recommendations
for ways SelectUSA may increase FDI in the United States and
better serve rural areas and smaller States, among other
things.
Section 6. Requirements for political appointees of Department of
Commerce.
This section would require the Secretary of Commerce, at
the beginning of each FY, to certify to Congress that each
newly appointed political official of the Department of
Commerce has received training on: regulations and policies
governing the use of subordinates for non-official business;
restrictions against the use of the political appointee's title
or position for personal gain or creating the appearance of
such use; key regulations and policies governing official
travel; and the advisability of monitoring renovation work done
to their office suites to ensure the cost of such work does not
contravene congressional budget restrictions.
This section also would require the Secretary of Commerce
to submit to Congress, not later than 30 days after the date of
enactment, a written report regarding the renovations to the
office suite of the Under Secretary for International Trade
regarding whether expenditures associated with those
renovations exceeded the $5,000 limit imposed by Congress and
whether the expenditures contravened the Anti-Deficiency Act.
This section also would require the Secretary of Commerce
to certify to Congress, not later than 30 days after the date
of enactment, that the Secretary has implemented procedures
requiring thorough documentation to support the categorization
of any work performed on an office suite of a politically
appointed official as general or routine maintenance, or
renovation work that is subject to congressional budget
restrictions.
This section also would require the Secretary of Commerce
to submit to Congress, not later than 30 days after the date of
enactment, a report on the steps the Secretary has taken to
make subordinates working for politically appointed officials
feel empowered to report instances of potential regulatory,
policy, or rule violations to their superiors or to the
Inspector General of the Department of Commerce.
Section 7. Authorization of appropriations for SelectUSA.
This section would authorize to be appropriated $15 million
for each of FYs 2017 through 2021 to carry out the SelectUSA
program.
Changes in Existing Law
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, the Committee states that the
bill as reported would make no change to existing law.
[all]