budget & appropriations

The latest news and legislative activity affecting budget and appropriations

July 11, 2019
legislative updates

Appropriations Update
The House has passed 10 of its 12 spending measures for FY2020, while the Senate is waiting for a budget caps deal before introducing its bills. On June 25 the House passed its second minibus package (H.R. 3055), which includes Agriculture-FDA, Commerce-Justice-Science, Interior-Environment, Military Construction-VA, and Transportation-HUD. It passed the Financial Service-General Government bill (H.R. 3351) separately on June 26. The two outstanding bills in the House are Homeland Security and Legislative Branch, which was dropped from the first minibus package amid criticism over member pay increases.

Appropriations, Budget Caps and Debt Ceiling Extension
Negotiations between the White House and congressional leaders to raise the budget caps and lift the federal debt limit continue to inch along. However, Speaker Pelosi (D-CA) spoke with Treasury Secretary Steven Mnuchin this week, reporting it was positive. Senate Finance Chairman Shelby (R-AL) has previously said that if a budget caps deal isn’t reached by July 1, he wants the Senate to deem its own set of stand-in numbers so appropriators can mark up their bills, but McConnell wants a deal first. Government funding runs out on September 30 and without new spending bills or a stopgap measure, the government would shut down October 1.

Earmarks
The Senate GOP recently behind closed doors added a permanent ban on earmarked spending to their conference rules even though House Democrats and Republicans had begun discussions on how to return to earmarking bills. A moratorium on earmarks from 2011 expired in January. House Appropriations Chairwoman Nita Lowey (D-NY) said in March that earmarks wouldn't return this year, but left the door open for the future, saying when applicable, they can change rules to permit members to request earmarks.

May 31, 2019
legislative updates

House Democrats scrapped plans to vote on a spending cap bill (H.R. 2021) last month because of disputes over balancing military and domestic discretionary spending. The House instead adopted a resolution (H. Res. 293) that permits House Appropriations Committee to write measures reflecting the bill’s proposed caps of $664 billion for defense (plus oversees funding not restricted by budgetary caps) and $631 billion for nondefense and started passing bills out of committee in April and May. President Trump and congressional Republicans want at least $750 billion for defense, including funds that are outside the spending cap. Senate Appropriations Chairman Richard Shelby (R-AL) has chosen not to schedule markups while waiting for a budget deal to be struck and aims to bundle bills. Meanwhile, the debt ceiling limit will be reached this summer so the White House indicated it prefers a debt limit deal done quickly to avoid instability in the economy.

As for the FY2020 appropriations process, several bills have already been marked up in the House and passed by full committee including Labor-HHS, MilCon-VA, State-Foreign Operations, Commerce-Justice-Science, Defense, Energy-Water, and Interior-Environment. Two other bills have passed subcommittees and will be voted on in the full committee next week and then bills will start to be considered on the House floor throughout June and leading up to the August recess. See details below.

Status of current U.S. House & Senate FY20 Appropriations Bills:

Earmarks

The Senate GOP recently behind closed doors added a permanent ban on earmarked spending to their conference rules even though House Democrats and Republicans had begun discussions on how to return to earmarking bills. A moratorium on earmarks from 2011 expired in January. House Appropriations Chairwoman Nita Lowey (D-NY) said in March that earmarks wouldn't return this year, but left the door open for the future, saying when applicable, they can change rules to permit members to request earmarks.

April 30, 2019
legislative updates

Appropriations

G2G attended appropriations hearings in Congress, tracking the LHHS and DoD budget hearings in particular in the House and Senate. A range of issues were covered but it is clear that NIH Director Collins is very committed to increasing his budget and being able to make more NIH awards. He and several Members of Congress spoke about the importance of young investigators and building the pipeline of future research. While Director Collins stated the NIH does not develop drugs, it plays an essential role and through NCATS can partner with industry to accelerate development. Both he and Chairwoman DeLauro (D-CT) agreed that NIH must step in when the market won’t to address neglected diseases, such as rare cancers. Within the Defense hearings ranging from F-35s to Defense HealthAgency, the DoD is equally forthcoming on the need for increased spending and has put a renewed focus on R&D to deploy modern technologies for the warfighter. All of this points to the need for a new budget caps agreement to avoid sequestration by year’s end.

 

Despite no new deal and a failed attempt to pass a budget raising the caps in the House, the House appropriators forged ahead drafting appropriations bills during the recess, abiding the budget legislation that passed committee. House BudgetChairman John Yarmuth’s (D-KY) bill, H.R. 2021, passed committee along party lines and aims to increase the caps under the Budget Control Act for FY2020-21by raising nondefense cap for FY2020 to $631 billion (+$34 billion or +5.7%over FY2019) and the defense cap for FY2020 to $664 billion (+$33 billion, or+2.6% over FY2019). Before the recess, the House adopted a rule to provide consideration of Chairman Yarmuth’s bill and establish a budget for FY2020, which automatically allowed House appropriators to allocate $1.3 trillion in base discretionary spending, without specifying for defense and nondefense programs. This allowed appropriations bills to be drafted during the recess so we expect markups of the 12 appropriations bills to begin in May in the House.

President’s Budget Proposal

Space exploration, disease research and affordable housing programs are among dozens of suggested cuts in the President’s FY2020 budget request released in March.It calls for a 9 percent cut to non-defense discretionary spending, including:

  • NASA: Cut $198 million from NASA’s Space Launch System, funding Block 1 but deferring funding for the upgraded, more expensive Block 1B. Eliminate NASA’s Office of STEM Engagement, cutting $110 million.
  • NIH: Cut $4.5 billion from NIH to go from $38 billion to $33.5 billion.
  • National Cancer Institute (NCI): Cut funding from $6.2 billion to $5.2 billion, but include a new $50 million per year pediatric cancer research program.
  • Foreign Aid: Eliminate funding for the State Department’s $3 billion Development Assistance account and the $760 million Assistance for Europe, Eurasia and Central Asia account, which would be covered by a consolidated Economic Support and Development Fund.
  • UN Climate Efforts: Give $6.4 million to the United Nations Framework Convention on Climate Change set up in 1992 to oversee talks toward a global climate accord and coordinate the global response to the issue, but zero funding for the Green Climate Fund, which was zeroed out during Trump’s first year in office.
  • Export-Import Bank: Cut the Export-Import Bank’s administrative budget from $110 million to $96 million.
  • Interior Department: Cut $178 million to five discretionary programs, including grants for abandoned mine reclamation and an Indian loans program.
  • FCC: Cut 1 percent to $335.7 million, although it would support agency efforts to expand internet access to underserved parts of the country, promote new technologies and services, protect consumers, and reform agency processes.