FY2021 Omnibus

On November 17, Republican senators released 12 bills to fund the government through September 2021, the first move toward negotiations with House Democrats, who passed their 12 bills during the summer. While Ranking Appropriations Senator Patrick Leahy (D-VT) highlighted several objections to the Republicans’ proposals, which differ greatly from the House-passed versions, the two parties were able to clinch a deal on November 25 on top line funding levels for a total package of $1.4 trillion. The agreed funding plan establishes overall totals for 12 appropriations bills that will be rolled into one massive omnibus bill that would boost federal budgets for the rest of FY2021, which ends on September 30 next year. Negotiators will keep the specific funding levels for agencies and programs — known as 302(b)s — under wraps until the detailed bipartisan, bicameral omnibus is finalized. Some issues to resolve range from NIH allocations as the House version includes shrewd legislative drafting that establishes an emergency health funding account similar to the military’s Overseas Contingency Operations that has helped the DoD circumvent funding constraints since the aftermath of the September 11th attacks. It enables a total of $235 billion increase for NIH and CDC tied to COVID that avoids the Budget Control Act caps, however the Senate version does not include this account and has lower funding. Another difference is the Senate funds the EPA with less funding than the House version in the Interior bill and includes funding for the border wall in the Homeland Security bill, a lingering sticking point that could shut down the entire process as it has done before. Within Defense, the Senate version totals $698 billion and prioritizes F-35 jets and within the Transportation bill, the emergency infrastructure funding in the House is excluded in the Senate version. However, there is some agreed prioritization as both the House and Senate support $12.5 billion for the VA MISSION Act in their Military Construction-Veterans Affairs bills and a boost for nutrition relief in the Agriculture-FDA appropriations bills. Because the House bills passed that chamber, the House can negotiate with a stronger hand. As details are hammered out, we will keep track and share updates.

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COVID Package

Majority Leader McConnell is backing Secretary Mnuchin’s proposal to use $580 billion that was allocated for Federal Reserve loan guarantees, small business aid and other virus relief programs that is unspent for targeted relief measures. One challenge is the reclaimed Federal Reserve funds are loans, not grants, and cannot be tapped for other programs under congressional budget scoring conventions. The Congressional Budget Office assumes that loans will be repaid, so there are no measurable savings from not offering the loans. Ways and Means Chairman Richard Neal (D-MA) and Democratic leadership oppose this proposal.

Whiplash on a Coronavirus Deal

On October 6, one day after being released from the hospital after contracting Covid-19, President Trump blamed Speaker Pelosi (D-CA) for the failure to reach an agreement on the coronavirus relief legislation and called off all negotiations. The stock market plunged (which was already teetering as traders have been warning of market volatility for some time). By nightfall, Trump sent multiple tweets that reversed his stance, calling for the immediate approval of $25 billion in support for the airlines and another $135 billion for small businesses. However, the Democrats are also seeking more funds for coronavirus response needs spanning from healthcare to childcare to unemployment benefits. On October 2, the House passed by 214-207 their $2.2 trillion revised HEROES bill, which includes a second round of $1,200 stimulus checks, $600 weekly federal unemployment benefits, $436 billion in new state and local aid, $282 billion for education and childcare, new money for airline and restaurant industries, Affordable Care Act subsidies for the unemployed, increased federal matching funds for Medicaid and additional money for providers, among other things. No House GOP lawmaker voted for it; 18 Democrats voted "no" and 10 Republican were no-shows.

Currently, the details of a deal include somewhere between the HEROES bill and Secretary Mnuchin’s most recent offer, which includes a $1.62 trillion package: $250 billion for state and local aid (about $100 billion more than Republicans were willing to offer in the last round of negotiations) and $400 per week in unemployment retroactive to September 12 and lasting through January 1, 2021 (which is less than the $600 a week Democrats want, but $100 more than Senate Republicans have proposed). The two sides disagree on major issues, such as funding for state and local aid, business tax provisions, and the Child Income Tax Credit. As the days tick away, election day draws closer and the schism grows between the two parties, making a deal all but impossible.

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Continuing Resolution Enacted

On September 30, the Senate passed and President Trump signed, a short-term funding bill several hours before the deadline to prevent a government shutdown. The Senate voted 84 to 100 to keep the government funded at current levels through December 11, setting up another funding fight after the November elections and just before the holidays. The House passed this funding bill in mid-September. The House also passed FY2021 Appropriations bills in July, but the Senate has yet to release any of their spending bills. Movement on those bills is not expected until after the November election. Speaker Pelosi, Senate Appropriations Chairman Richard Shelby (R-AL) and Senate Appropriations Vice Chairman Patrick Leahy (D-VT), have discussed the importance of appropriators trying to meet the December 11 continuing resolution deadline.

The House and Senate leadership failed to negotiate a Covid-19 deal with Secretary Mnuchin and the administration to address the economic slump due to over 30 million people filing for unemployment and continuing challenges of managing the Covid-19 pandemic ranging from healthcare to online education. Democrats had offered to cut their original stimulus proposal called the HEROES Act that passed the House in May totaling $3.5 trillion by roughly one third, but insisted on funding assistance to states, cities, and other municipalities. The administration rejected the Democrats’ topline number and offered to put in no more than $150 billion for local assistance. Despite this failure, the FY2021 appropriations process moved forward in the House at the end of July. On July 24, the House passed a minibus that included: Agriculture/FDA, Interior, Environment, MilCon-VA and State. On July 31, the House passed a second minibus that included: Commerce Justice and Science, Defense, Energy and Water, Financial Services, Labor Health and Human Services and Transportation Housing and Urban Development. Some details of interest are below.

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House FY21 Agriculture-FDA Appropriations Bill

The House passed the Agriculture-FDA appropriations bill on July 24, 2020. This bill funds the FDA for FY21 at $3.21 billion, which is an increase of over $40 million from FY20 but over $8 million less than the administration requested. The House bill provides increased funding for medical product safety and includes new initiatives to advance a new influenza vaccine manufacturing technologies and funding to develop a framework for regulating CBD products. In addition, the bill includes a strong focus on continuing efforts to increase the safety and cybersecurity of medical devices. The bill also appropriates $70 million to accelerate medical product development as authorized in the 21st Century Cures Act. To modernize prescription drug development, it encourages FDA to expand its efforts to improve prescription drug manufacturing and quality.

To help combat antimicrobial resistance the House provided an additional $1 million for the Center for Veterinary Medicine (CVM) to support implementation of the FDA’s 5-year plan for supporting antimicrobial stewardship in animals. This plan includes steps to mitigate antibiotic resistance by ensuring that medically important antibiotics for use in food-producing animals have clearly defined durations of use. The agency is expected to issue draft guidance describing a strategy for clearly defining durations of use that are consistent with existing regulations and guidance by the end of FY 21.

This legislation also encourages FDA to examine the policies and regulations surrounding automated compounding to incorporate and incentivize the use of automation technology to enhance safety and improve accuracy in drug compounding. It encourages the FDA to understand how automated microbial detection systems in health care manufacturing technologies can increase the efficiency and safety of the domestic medical product manufacturing and supply chain to decrease US reliance on global supply chains. The bill also comments on FDA’s finalized guidance document on Bacterial Risk Control Strategies for Blood Collection Establishments and Transfusion Services. Congress is still concerned about the risk and encourages the FDA to ensure future approvals are consistent with this guidance and are supported by patient safety data.

Of course, Covid-19 is addressed in the bill. The FDA portion of bill provides funding and guidance for the Covid-19 pandemic and expresses concern with the delays at the beginning of the crisis. It instructs the FDA to contract with an outside entity to provide an assessment of its COVID-19 response, highlighting the failures and successes, to better understand how the agency can improve its response capabilities and enhance its ongoing activities to protect the public health.

G2G worked with the Committee to focus on rare cancer therapeutics and the underrepresentation of women and minorities in clinical trials that worsens health outcomes and hinders women’s health innovation. Both are included in the legislation. Building off of the first-time ever $5 million FDA allocation dedicated to rare cancer in FY20, the House included an additional $2.5 million to address gaps in the system, streamline resources, accelerate the development of rare cancer therapies and advance the field of cancer research overall, mirroring the efforts of the National Cancer Institute’s Developmental Therapeutics Program. Also, to improve cancer immunotherapy clinical trials, the legislation urges the FDA to work with the research community and pharmaceutical industry and provide guidance for standardizing clinical trial design for immunotherapy-based combinations in order to help clinicians better select optimal treatment options for their patients. The FDA is required to provide a report on its work to increase women and minority representation in clinical trials, female mice representation in pre-clinical trials, data on differences in male and female responses to medications, including sex-specific biomarkers in simulation models and transparency in addressing biological differences.

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FY21 Labor, Health and Human Services, Education (LHHS) House Appropriations

On July 31, 2020, the House passed an appropriations package that included funding and provisions for the Departments of Labor, Education and Health and Human Services. The entire package for FY21 totals $196.5 billion. This is $20.8 billion more than what the President requested and $2.4 billion more than FY20. Specifically, this includes $96.4 billion for the Health and Human Services, $73.5 billion for the Department of Education and $12.7 billion for the Department of Labor. It includes $4.5 billion in emergency supplemental appropriations for BARDA to support advanced research and development and advanced manufacturing of vaccines and therapeutics.

The bill provides additional funding to help fight the Covid-19 pandemic including:

• $9 billion for the CDC for public health and emergency preparedness and response, including $4 billion for a vaccination campaign
• $5 billion for the NIH
• $5 billion for the Public Health Emergency Fund
• $4.5 billion for the Biomedical Advanced Research and Development Authority, including $3.5 billion for advanced research, production, and purchase of vaccines

Under the bill, HHS would be required to report weekly to Congress during the pandemic on the inventory of ventilators and personal protective equipment in the Strategic National Stockpile. The bill provides a total of $47 billion for NIH, which is an increase of $5.5 billion above the FY20 level with $5 billion of the funding categorized as emergency appropriations to avoid the current budget caps set long before the Covid-19 pandemic. The House bill increases funding for each of the Institutes and Centers under NIH by no less than 7%. Some of the targeted investments in high-priority areas, include:

• $150 million to support CDC’s efforts to reduce new HIV infections by 90% in 10 years
• $30 million for the Diabetes Prevention Program
• $67 million for racial and ethnic health disparities, Racial and Ethnic Approach to Community Health (REACH)
• $68 million for the safe motherhood program
• $10 million for a new effort focused on healthy aging
• $7.5 million for domestic violence prevention

This legislative package includes $9 billion in emergency supplemental funding for the following public health and emergency response activities:

• $4 billion for enhanced public health prevention efforts including an influenza vaccination campaign
• $2 billion for Public Health Emergency Preparedness cooperative agreements to increase State and local public health emergency response capabilities
• $1 billion to improve capabilities at State and local public health laboratories
• $400 million to modernize public health data surveillance and analytics
• $400 million for the Infectious Diseases Rapid Response Reserve Fund

The bill includes $7.2 billion for Health Resources and Services Administration (HRSA), an increase of $159 million over FY20. HRSA provides healthcare to people who are geographically isolated or are part of economically and medically vulnerable.

• $1.65 billion for the Health Centers program which includes $10 million to support school-based health centers
• $981 million to improve maternal and child health, including an additional $25 million for the Maternal and Child Health Block Grant

The bill directs NIH to transfer $195 million from the NIH Innovation Account to NCI to support the Cancer Moonshot initiative. G2G successfully secured language in the report to advance how the federal government addresses rare cancer, molecular diagnostics and advanced drug development; respond to radiation exposure through imaging technologies; and address racial bias in the delivery of healthcare.

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House FY21 Defense Appropriations Bill

On July 31, 2020 the House passed a package to fund the Department of Defense for FY21 (separate from the National Defense Authorization Act that passed the House on July 12). This includes operations and maintenance, readiness activities, research and development, equipment modernization, and health and quality-of-life programs for servicemembers and their families, as well as a 3% pay increase for our troops. This bill provides $694.6 billion for DoD, which is an increase of $1.3 billion above the FY20, and $3.7 billion below the President’s budget request.

The Military Personnel funding is $157.7 billion in base funding for active, reserve and National Guard military personnel, a decrease of $1.2 billion below the budget request and an increase of $7.5 billion above FY20. The bill provides funding for active duty end strength of 1,351,500, an increase of 12,000. The bill also funds our reserve component to the strength of 802,000, an increase of 1,200. This package also provides $323 million for Services’ Sexual Assault Prevention and Response programs at the DoD.

For the Operation and Maintenance accounts, the House provided a total of $254.5 billion for FY21. This includes an additional $116 million to upgrade childcare facilities for military families. The FY21 Procurement total is $140.1 billion. This includes a $4.1 billion increase for additional investments in ground vehicles, aircraft and ships. To assist the DoD during the pandemic, $450 million was provided for resupply and recovery for Covid-19.

For R&D, the House provides a total of $104.6 billion for Research, Development and Evaluation programs. It includes $3.51 billion for DARPA research programs. The R&D funding covers basic and advanced projects and includes focused funding and directives on everything spanning from military medical research to hypersonics to cybersecurity. The bill includes several specific investments to ensure that the US has the workforce trained and ready in cybersecurity and STEM fields to protect our national interests today and in the future.

G2G worked with the committee specifically to address cybersecurity workforce issues and to protect hardware and embedded systems. This includes language to address the widespread shortages in cybersecurity talent across both the public and private sectors. The bill also includes dozens of recommendations from the Cyberspace Solarium Commission, including the position of Under Secretary of Defense (Research and Engineering) to direct cyber-oriented units to collaborate with local colleges and universities on research, fellowships, internships, and cooperative work experiences to expand cyber-oriented education opportunities and grow the cybersecurity workforce. It also encourages the Under Secretary to prioritize collaboration with colleges and universities near military installations as well as the veteran population and state cyber ranges in executing these workforce training programs. The partnership of the Air Force Research Laboratory with the Center for Hardware and Embedded Systems Security and Trust is an example of such a collaboration that the Committee calls out in the bill.

Military medical issues are addressed in the Defense Appropriations bill. The Defense Health Programs received $33.3 billion and adds $512.5 million for cancer research in the bill. The bill continues the first-ever separate funding line for rare cancer that G2G advocated for and secured in last year’s bill in this year’s bill as well. G2G remains actively engaged in the Defense Health Research Consortium and worked to increase military medical R&D funding. The program funding levels include:

• $150 million for the breast cancer research program
• $110 million for the prostate cancer research program
• $50 million for the kidney cancer research program
• $35 million for the ovarian cancer research program
• $20 million for the lung cancer research program
• $20 million for the melanoma research program
• $10 million for the pancreatic cancer research program
• $7.5 million for the rare cancer research program
• $110 million for the cancer research program
• Adds $175 million for the peer reviewed psychological health and TBI research program
• Adds $40 million for spinal cord research
• Adds $40 million for the Joint Warfighter Medical Research Program
• Adds $150 million for Covid-19 Resupply and Recovery

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House FY21 Transportation, Housing and Urban Development Appropriations (THUD)

The House passed the THUD appropriations bill on July 31, 2020. This bill provides $107.2 billion for the Department of Transportation which is an increase of over $20 billion over FY20 and over $19 billion over what the President requested. This bill includes:

• $1 billion for National Infrastructure Investments including the TIGER and BUILD grants.
• $3 million the Highly Automated Systems Safety Center of Excellence
• $18. 1 billion for the FAA
• $16.9 billion for the Highway Trust Fund an increase of over $14 billion from FY20
• $3 billion for the Federal Railroad Administration

The House bill makes significant investments to improve our aging infrastructure. This includes a $100 million investment that G2G advocated for the Magnetic Levitation Technology Deployment Program that includes hyperloop technology. In addition, there were several provisions included in the package that seek to make changes within the DOT and to make Americans safer. The package requires Amtrak, airlines and public transit systems to require passengers and employees to wear face masks due to the COIVD-19 pandemic. The FRA would not be allowed to reallocate funding from a high-speed rail project in California until after lawsuits surrounding the project are finalized and would provide $5 billion for a MAGLEV train between Washington, DC and New York City.