Category: Legislation

Yesterday, the House of Representatives failed to approve a continuing resolution (CR) that would fund federal government beyond September 30^th – the end of the federal fiscal year.  That CR would have extended funding at current levels through November 18^th.

Two issues caused the defeat of the bill.  First, the failed CR would have set the total annual spending level for the first seven weeks of FY12 at an annualized rate of $1.043 trillion, in accordance with the debt limit law approved in early August.  This is higher than the $1.019 trillion budget that the House adopted in April, which caused concerns for many House Republicans who want to see greater reductions in government spending.  The second contentious issue has to do with how to pay for disaster funding for states hit hard by Hurricane Irene and tornados.  The House bill would have provided $1 billion in FY11 money for the nation’s Disaster Relief Fund, offsetting that amount with a $1.5 billion cut in an energy-efficient auto program.  The CR also would have provided $2.65 billion in FY12 disaster spending.  Senate Democrats prefer a measure sponsored by Majority Leader Reid (D-NV) that would provide $500 million in FY11 disaster aid, without offsets, and $6.9 billion for FY12.  Disaster funding legislation has traditionally been approved without offsets.

With both chambers set for recess next week, a deal must be struck quickly to avoid a government shutdown when the new fiscal year begins October 1^st.  Late last night, the House Rules Committee approved a same-day measure that could allow the House to consider a revised version of the CR as soon as this afternoon.  There is some speculation that House leaders will pare spending levels CR as a way to attract additional support from conservative lawmakers.  However, Senate Democrats have taken a tough stand on that issue and say they will not agree to any CR that would alter spending levels set in the August debt agreement.  

We should learn more as the day goes on.

The Association of American Universities (AAU) released the following outlook today for the appropriations process scheduled to resume next week when congress returns from recess:  

The Senate Appropriations Committee will begin moving its FY12 bills next week as soon as the Senate returns from the August recess on September 6.  Two bills will be marked up that day in their respective subcommittees: Energy and Water and Homeland Security.  CQ Today reports that the full committee is expected to meet shortly after the subcommittee markups to adopt the FY12 spending cap and allocate funding among the panel’s 12 subcommittees.  Just one funding bill, Military Construction-Veterans, was approved by the Senate before the recess. 

 Senate Democratic leaders delayed approval of an FY12 budget resolution, which sets the discretionary spending ceiling for the fiscal year, because they could not gain majority support for any particular level of spending.  The issue was resolved on August 2 with enactment of the Budget Control Act, which included a discretionary spending total of $1.043 trillion for FY12.  That is $7 billion less than the FY11 level, but about $23 billion more than the level in the House-passed FY12 budget resolution.  

Earlier this year, the House passed an FY12 Budget Resolution that cut $30 billion from discretionary spending in FY11, and then approved six of its 12 appropriations bills based on those numbers.  The remaining bills include Commerce-Justice-Science, which funds the National Science Foundation and NASA, and Labor-HHS-Education, which funds the National Institutes of Health and student aid.

At this writing, House Republican leaders have not said how they will move forward on the remaining FY12 bills in light of the increased spending total, but they have expressed support for abiding by the higher overall number.  House Majority Leader Eric Cantor (R-VA), said in a memorandum to his Republican colleagues on August 17, “While all of us would like to have seen a lower discretionary appropriations ceiling for the upcoming fiscal year, the debt limit agreement did set a level of spending that is a real cut from the current year level.  I believe it is in our interest to enact into law full-year bills at this new lower level.”  House Appropriations Committee Chairman Hal Rogers (R-KY) stated his commitment to maintaining “the responsible 2012 spending level agreed to by the House, Senate, and White House under the recent debt ceiling agreement.” 

 While the Senate appropriations process is finally moving forward, the new fiscal year is just one month away, so there seems little chance that the House and Senate can approve all of their bills and reconcile them with one another by October 1.  The more likely scenario is congressional approval of one or more continuing resolutions to sustain funding into the new fiscal year, followed by some type of omnibus appropriations package.

The House approved the deficit reduction bill last night by a vote of 269-161; 95 Democrats and 66 Republicans voted against the measure.  Congressmen Adam Smith and Jim McDermott voted no, while the remaining members of our delegation voted in favor of the bill. The Senate is expected to clear deficit reduction legislation at noon today.  And while it is not on the President’s schedule for today, he is largely expected to sign the bill before the close of business.  With his signature, a six-month-long battle over raising the debt ceiling ends but the next round begins with future fights over spending, taxes, and entitlement programs.  

With that vote, the House went into recess last night and is not expected back in DC until after Labor Day.  The Senate will join their House colleagues once they conclude their vote.

As I reported yesterday, the legislation would cap discretionary spending for FY12 and FY13, effectively freezing it at current levels and only adjusting it to match historical levels of inflation (2.2 percent) through 2021. It would also create a joint congressional committee tasked with finding between $1.2 trillion and $1.5 trillion in new savings, and sending a proposal to the House and Senate floor for guaranteed votes by December 23^rd.  If those savings are not enacted, sweeping automatic budget cuts would be triggered.

Democrats are hopeful that the debt limit deal might generate more spending for domestic programs, while Republicans are concerned about cuts in defense.  The allocations would reverse cuts set in April by the House Republicans’ budget target, which would have lopped $30 billion from discretionary spending compared with FY11.  The Labor-HHS-Education and Transportation-HUD bills had been set to include the majority of those cuts and have yet to be unveiled in the House.  The extra funds could ease the path of those bills when they are marked up in September.  With an allocation to work from, Senate appropriators also hope to begin moving bills, which are almost certain to differ from their House-passed counterparts.