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exceed the requested appropriation. As you may recall, our estimate was that $463 million would be deposited in the Panama Canal Commission Account in fiscal year 1980.
As you will note from the proposed Authorization Bill, we propose to establish an emergency fund of $25 million during fiscal year 81. This fund will be derived from revenues deposited in the Panama Canal Commission Fund in the Treasury plus the unexpended balance of the fund from 1980, which I have just mentioned. While the $25 million amount is short of the $40 million originally requested for fiscal year 1980, it appears adequate to cover any reasonably foreseeable emergency. It is certainly adequate to permit initiating emergency action while concurrently seeking a supplemental appropriation if required.
A second point of significance is the proposed capital program: $23 million has been requested for 1981, $17.9 million of that amount will be applied to transit projects. The sources of funds for this investment category are the depreciation allowance and the capital factor of 2.16 cents per Panama Canal ton included in the toll rate. In our estimation, this level of capital funding is adequate for nearterm requirements.
PROPOSED AMENDMENTS
I seek your assistance in revising certain items in the Bill currently awaiting floor action by the House of Representatives. If allowed to stand, these items will adversely affect the operation of the waterway and will certainly impede efforts to restore employee morale.
An insert in Section 2(d)(1) of the Bill provides that increases in expenditures for previously approved projects can be disapproved by any of the four authorization and appropriations committees or subcommittees. The phrase states, "Any of the committees or subcommittees may disapprove the increases in expenditures proposed by the Commission." The Bill already provides for an overall project category limit that we accept and will comply with even if certain projects experience difficulties. The effect of requiring the second approval is to delay the start of certain projects, or to suspend or abandon ongoing projects. The inefficiency and cost attendant to such a course of action argue strongly against the proposal. We ask that the language be deleted.
We believe that the Board should be given this reprograming authority so long as the amount authorized and appropriated by the Congress for the total capital program and major categories within it is not exceeded.
I recommend that the Committee also adopt language authorizing the Commission to initiate projects not included in the budget submission, but subsequently determined by the Board to be necessary for the efficient and safe operation of the Canal provided that 30 calendar days notice be given to both Houses of Congress and that such new project starts will not violate the ceiling for the various categories of capital projects. There have been cases in the past where similar reprogramming actions were ncessary to assure safety and to increase Canal capacity, such as replacement of the soft-nose center wall protectors at both Pedro Miguel and Gatun Locks as a result of marine accidents, and unprogrammed repair to the miter gates. Appropriate language was contained in Section 2(d)(1) of the Administration's Bill introduced in the House as H.R. 6516.
The remaining actions, which I believe are necessary, require restoration of budget limitations imposed by the House of Representatives in three activities. I shall mention each of these only briefly. The Administrator is prepared to provide more detailed justification.
Referring to the Bill, I first request that all limitations on the hire of vehicles, Section 2(a) (1), be removed. The funds are required to provide a contract for shuttle bus service that transports employees where duties are directly related to the actual movement of ships through the Canal. The cost of the contract is variable because of cost escalation clauses in the contract.
The reduction of $68,000 applied to the operation of guide services, Section 2(a) (6), would require one of two equally unfavorable actions. The Commission would either be required to remove the motor launch Las Cruces from service, or reduce the visitor facilities operations to an ineffective level. We therefore request that the limitation be raised to $340,000.
The final suggestion we offer is to restore the limitation on maintenance of facilities; Section 2(a) (11), from the $3.724 million level passed by the House to the budget level of $5,109 million. This item covers only housing retained by the Commission for use by employees. The proposed limitation constitutes a substantial adverse impact on an employee benefit ranking second only to pay as a