The legislation would rescind $9.5 billion of the $19 billion appropriated by Congress in 1980 for support of synthetic fuels. It would also limit the use of the remaining funds to those projects whose products will not cost significantly more than the projected market price of competing fuels.

The President's proposal is the result of careful review within the administration and reflects an effort to strike a balance between avoiding unnecessary and wasteful expenditures of scarce Federal dollars and preserving a sound, sensibly scaled national synthetic fuels program.

The administration also announced the President's intent to nominate three individuals to fill the current vacancies on the Board of Directors of the Synthetic Fuels Corporation. A fourth nomination is currently in progress.

Enactment of the proposed legislation would leave the Synthetic Fuels Corporation with approximately $4.6 billion in unobligated funds that could be used to support a wide array of carefully selected private synthetic fuels projects. These projects would be in addition to the four major synthetic fuels projects and other alternative energy grants totaling approximately $5 billion that have received Federal support from the funds appropriated to the Energy Security Reserve in 1980.

The Synthetic Fuels Corporation was established in 1980 with the enactment of the Energy Security Act of 1980 for the purpose of providing financial assistance to commercial-scale synthetic fuels projects.