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August 11, 2015

CHN: Odds of Year-End Deal on Spending Increase as August Recess Approaches

The Senate Appropriations Committee cleared its final appropriations bills on July 23, marking the first time in six years that all 12 appropriations bills have made it through that chamber’s committee (the House Appropriations Committee has also passed all 12 bills, and the full House has passed six of those 12). It looks to be a hollow milestone however, as it is unlikely any spending bills will get full Congressional approval by the September 30 fiscal year deadline.

Members of the House of Representatives headed home for the annual August recess last week, but before they did, House Speaker John Boehner acknowledged that a temporary extension of current spending levels, also known as a Continuing Resolution or CR, would be needed to prevent a government shutdown. As noted in the July 20 Human Needs Report, Senate Democrats have said they will block all appropriations bills from moving forward because they adhere to restrictive sequestration spending caps, and President Obama has threatened to veto the bills for the same reason. In addition, the House is scheduled to have only 10 legislative days in September, and the Senate only has 15 days, leaving too little time to work out a larger deal that both sides could agree upon. A CR would be expected to extend current funding into November or December.

This is around the same timeframe that several other spending and revenue decisions will need to fall within, setting up a possible large year-end package. Congress acted this week to stop federal highway fund spending from drying up, but they only extended the funding through the end of October (see separate article in this Human Needs Report for more information). The limit on federal borrowing will be reached towards the end of the calendar year. In fact, CQ reported that House Deputy Whip Tom Cole (R-OK) recently suggested combining a comprehensive FY16 spending bill with a long-term highway bill and a debt-ceiling increase.

The Senate is still in session this week and will start its August recess this weekend. Lawmakers in both chambers will return to DC after Labor Day. Congressional leaders and the White House will need to start negotiations on a spending deal. While there is bipartisan interest in negotiating spending levels that exceed the sequestration caps, there are very different ideas on what that looks like. Advocates for low-income people have been fighting for increases in appropriated programs from housing to education to nutrition, but they insist that these increases must not come at the expense of vital safety net programs like Medicaid, Medicare, SSI, SNAP/food stamps as some conservative legislators are calling for. Democratic leaders are proposing a $125 billion two-year sequester-relief deal or a $75 billion one-year sequester-relief deal, in which spending caps would be raised equally for defense and non-defense spending. This could be paid for using the revenue from a version of an international tax deal currently being called for as part of the highway bill. Senate Minority Leader Harry Reid (D-NV) thinks the timing of Pope Francis’ address to Congress on Sept. 24 could help make the case for funding programs that serve the poor and disadvantaged.

In addition, numerous policy riders have been attached to House or Senate appropriations bills, including attempts to block the Affordable Care Act, limit regulations on e-cigarettes, environmental protections and consumer financial protection, and prohibit the study of gun violence. These or other riders later offered as amendments risk controversies so bitter that they increase the chance of impasse and government shutdown.

The Human Needs Report will take a break in August while Congress is in recess. For updates in the interim, subscribe to CHN’s blog, Voices for Human Needs.

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