one quick answer would be:
Proposed is subjunctive. so u need a 'that' .
Subjunctive words need to be followed by a 'that'

Hope this clears your confusion

Hi Ricosh,

Slightly less quick answer (did my best to keep it short):

What's being used in the correct answer choice, as noted above, is a form of the subjunctive mood. We use this form of the subjunctive mood with directive verbs like "propose." The subjunctive in this case requires:

Directive verb + "that" + ROOT form of the subordinate verb.
(The root form is simply the infinitive minus the "to" ... in this case, "be")

So in the question at hand, this rule gives us the following correct use of the subjunctive:
"The commission proposed that funding ... be obtained ...."

Now, to your proposed (and admittedly more concise) alternative, here's the catch: although in common speech, we often drop or ignore the "that," it's not actually correct to do so.

Hope that helps!

Steve P.

ahhh, thanks you two! totally helps....seems so simple, right in front of my face now in my manhattan sc book. damn!

request that
propose that
desired that
ect ect...

totally makes sense!