Friday, December 23, 2011

President Signs Legislation Funding SEC for FY 2012 and Authorizing CFTC Fund Transfer

President Obama signed the Consolidated Appropriations Act, which provides $1,321,000,000 for the SEC for FY 2012 instead of $1,185,000,000 as proposed by the House and $1,407,483,130 as proposed by the Senate. The conference agreement provided that $1,321,000,000 be derived from offsetting collections resulting in no net appropriation. The conference agreement also provided that the SEC Office of Inspector General must receive no less than $6,795,000 as proposed by the Senate, instead of$6,790,000 as proposed by the House. The legislation contains a provision allowing the CFTC to transfer $10 million in funding between the agency’s Information Technology account and its Salaries and Expenses account.

The Act also makes available $100,000 for expenses for consultations and meetings hosted by the SEC with foreign regulatory officials to exchange views concerning securities matters. It also rescinds $25 million from the unobligated balances available in the SEC Reserve Fund established by Section 991 of the Dodd-Frank Act, which created a Reserve Fund that the SEC could use as it deems necessary to carry out its functions.

While the Consolidated Appropriations Act generally withholds funding for interagency commissions, councils, or committees, the legislation specifically states that funds made available to the CFTC and SEC may be used for the interagency funding and sponsorship of a joint advisory committee to advise on emerging regulatory issues.

The conferees did not adopt the Senate designation of $483, 130 specifically for the strengthening of the acquisition workforce. However, while not designating funding, the Conference Committee remains concerned about the SEC's acquisition processes and expects the SEC to dedicate sufficient resources to strengthening the agency's capacity and capabilities of the acquisition workforce.

The conferees remain concerned with the SEC's lack of judgment in its past
leasing practices. (H 112-131) The conferees are aware of the SEC's arrangement with the General Services Administration, which the conferees believe is a good first step. The conferees intend to closely monitor how the SEC exercises its leasing authority to ensure that the Commission has adequately reformed its leasing practices. The conferees are also concerned about the unauthorized destruction of documents by the SEC.

Due to the above concerns, the conferees direct the SEC to provide the House and Senate Appropriations Committees with corrective action reports, submitted to the SEC Inspector General, related to lease agreements and document destruction no later than 30 days after enactment.