Seemingly Wasteful Programs Not Easy to Cut : Government: West Texas helium reserve is one example of how a costly operation that serves little purpose can survive.

Even before the ink is dry on President Clinton’s new initiative to make government more efficient, the White House has quietly agreed to continue operating a controversial West Texas helium reserve whose chief benefactor is a congressman who lent crucial support to the Administration during this summer’s budget battle.

Critics said that the decision to spare the reserve, which came under intense scrutiny from the National Performance Review headed by Vice President Al Gore, amounted to a reward for the congressman’s vote. The Administration insisted, however, that the move was made for far more complex, economic reasons.

Whatever the motivation, the outcome serves as an example of the political and bureaucratic obstacles facing the Administration as it attempts to root out entrenched and seemingly wasteful spending programs.

The performance review’s report released Tuesday calls for streamlining the helium program, but stops short of proposing its elimination. Instead, the recommendations track closely with earlier proposals by Rep. Bill Sarpalius (D-Tex.), the program’s main benefactor in Congress, a spokesman for the congressman said.

Sarpalius, a crucial vote on the Administration’s budget, talked with President Clinton four times on the day of the vote in the House in early August and raised his concerns with the President then about the fate of the helium program. At the time, Clinton was cutting a series of deals with lawmakers in an effort to put his budget over the top.

Virtually every program in the federal government has important allies in Congress, and their supporters can offer good reasons for each program’s continued existence. Many, like the helium program, also would be so costly to eliminate quickly that they ultimately remain on the books so the government does not have to account for even larger taxpayer losses in the short run. So identifying programs that seem ripe for the budget knife is the easy part. Actually getting Congress to go along is much tougher.

The helium reserve, like so many other federal programs that now seem obsolete, began with the best of intentions.

The reserve, which supports 220 Bureau of Mines employees in Amarillo, Tex., was created in 1925 to ensure adequate reserves of the gas for the Army’s fleet of dirigibles. It was only a tiny program, however, until the early 1960s, when it was dramatically expanded in the early days of the space program. The government thought then that huge quantities of helium would be needed for space launches in the race to the moon.

So beginning in 1961, the government pumped more than 30 billion cubic feet of the gas into a huge underground reservoir near Amarillo, according to Dale Bippus, general manager of field operations for the helium program.

That reserve now contains enough helium to last the federal government at least 60 years. Only a small part of the helium has ever been used by the federal government and the Bureau of Mines has been saddled with ever-mounting debts, now totaling $1.3 billion, brought on by those excessive helium purchases for the reserve.

Despite the enormous supply, the Bureau of Mines still charges other federal agencies that use helium--most notably the National Aeronautics and Space Administration, the Pentagon and the Department of Energy--much higher prices than private suppliers charge on the open market, according to Bippus and congressional officials. By law, federal agencies are prohibited from buying helium from private suppliers. Thus, they represent a captive market for the bureau.

Clearly the program is an albatross but one that the government cannot easily discard.

In his book “Parliament of Whores,” satirist P. J. O’Rourke has called the helium program “amazingly stupid, even by government standards.” Some in Congress have taken up the cause against the program as well. Rep. Christopher Cox (R-Newport Beach), introduced legislation earlier this year that would have ended the helium reserve’s monopoly on sales to NASA. That legislation passed the House, but was declared “non-germane” under congressional rules, allowing the program to continue.

“There is no justification for this program’s existence,” acknowledged Elaine C. Karmarck, an adviser to Vice President Gore. “It is rather silly for the federal government to be in the helium business. “We identified this early on as one of those weird things that the government does. We don’t pretend this makes sense. But we are in the business and you can’t just cut the thing loose. You would then instantly reduce the value of those assets held by the government.”

What’s more, the helium reserve has become an important fixture in the Amarillo economy, with 220 jobs on the line--and Sarpalius and other Texas legislators are there to protect them. That adds up to a powerful mix of political forces supporting the continued existence of the helium reserve.

Karmarck insisted that the performance review task force decided not to eliminate the program even before its staffers met with Sarpalius and stressed that its recommendations were not influenced by any budget-related deal.

“We never were going to eliminate it,” Karmarck said. “As soon as we got into it, we realized this was complicated.”