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[[underlined]] General Comments [[/underlined]]

The [[underlined]] Prospectus [[/underlined]] highlights the Institution's extensive backlog of programmatic infrastructure requirements in the chapter "Stewardship of the Public Trust." These requirements continue to receive attention as the principal area needing operating support in future years. Other chapters emphasize the Institutions's global environmental research, cultural pluralism, education, facility repair and restoration, and construction plans. The continued facility and program development of the National Museum of the American Indian also receives major emphasis in the next five-year plan.

The Smithsonian faces uncertain times with regard to future funding growth as the government deals with budget balancing problems, as competition for donor and private funds increases and and as the general economic climate continues to undulate. The resource projections in the [[underlined]] Prospectus [[/underlined]] reflect this uncertainty.

[[underlined]] Operational Growth

Federal Operations [[/underlined]]

Institutional Federal operating projections build on the fiscal year 1993 request submitted to the Office of Management and Budget. The impact on operations in outyears of potential reductions as a result of final Congressional action on fiscal year 1992 appropriations and Executive Branch reviews of fiscal year 1993 are highly uncertain at present. The Institution will refine the projections for future years for the January final [[underline]] Prospectus [[/underlined]] as this information becomes available. The Institution currently projects Federal operating funding at $483 million in fiscal year 1997. The projections contain virtually no new program growth except for the National Museum of the American Indian for which operating projections are preliminary. The Institution anticipates operational costs of $25 million in fiscal year 1997 for the Museum. Otherwise, Institutional projections reflect the estimated cost increase associated with eliminating the infrastructure backlog ($10 million per year for three years) and expected legislated pay actions and inflation.

[[underlined]] Trust Operations [[/underlined]] 

Trust projections for future years remain conservative, with gross revenues from unrestricted operations growing moderately. The projected requirements, shown as $332 million for fiscal year 1997 in the following table, result from growth associated with auxiliary and development of the [[underlined]] Smithsonian [[/underlined]] magazine, Smithsonian Institution Press, museum shops, mail order division, and concession operations, and the results of investing in fund-raising activities, especially the national campaign to raise funds for the partially trust-funded construction of the Mall facility for the National Museum of the American Indian.

[[underlined]] Government Grants and Contracts [[/underlined]]

Grant and contract activity is difficult to project because of the uncertainty surrounding Federal funding for source agencies in future years. The Institution's objectives are to maintain at least a relatively stable