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Federal advocacy update

Leslie Mozingo serves as a federal government relations consultant to the NCACC. After graduating from the University of Alabama in 1988, Leslie immediately moved to Washington, D.C. to start working for a Congressman. She left Capitol Hill to become a federal lobbyist in a firm where she remained for nearly 23 years until she launched Strategics Consulting. Contact Leslie at (202) 255-5760 or leslie@strategics.consulting. Website: www.strategics.consulting.

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Jul 20

Budget and Apporpriations: The Federal Funding Process

Posted on July 20, 2016 at 10:49 AM by Todd McGee

Congress is tasked annually with producing a budget resolution and appropriations bills that provide discretionary spending in each federal fiscal year for numerous activities -- such as national defense, homeland security, education, and social services. The remainder of federal spending comprises direct (or mandatory) spending and debt interest.

The annual process begins with the submission of the President’s budget request to the Congress, which is due on the first Monday in February, although that date often slips, especially at the beginning of a new administration. The President’s budget proposal is simply a request and has no binding authority on Congress. It is considered instead to be a detailed statement of the administration’s fiscal goals and policy preferences for that fiscal year.

When the President and Congressional majority are of different parties, and particularly during a Presidential election year, the President’s budget proposal is usually ignored by Congress. Regardless, Congress follows with its own budget resolution that sets discretionary spending ceilings for the upcoming fiscal year. While the resolution typically covers federal spending for 10 years, it is not binding beyond the approaching fiscal year. 

Like regular legislation, budget resolutions originate in committee, in this case the House and Senate Budget Committees, and must be approved by the whole chamber. The statutory deadline to complete the budget resolution is April 15, although that date slips frequently, too.

Many times during the last decade Congress did not adopt a budget resolution. Unlike regular legislation, budget resolutions do not require presidential action, can pass with a simple majority, and cannot be filibustered in the Senate. Due to their non-legislative status, and like the President’s budget, Congressional budget resolutions also serve as the majority’s message about their fiscal priorities.

The funding process then moves to the House and Senate Committees on Appropriations, where program-by-program funding levels are determined through action on 12 separate appropriations bills. Each of the 12 appropriations subcommittees is named for the federal agencies it is responsible for and generates the appropriations bill providing annual funding for those agencies, programs, projects and activities (for example, the Subcommittee on Labor-Health and Human Services, Education and Related Agencies).

During the subcommittee process primary agency officials testify on their budget requests, and members of Congress submit requests for programmatic levels and language. The subcommittee produces a draft bill that may or may not be amended (called a “markup”) before reporting it to the full committee. House and Senate Appropriations Committees hold their own markups and report their bills to their respective floors for further action. In recent years, formal committee action has sometimes skipped past the subcommittee level and began at full committee markup instead. Any differences between the two versions are resolved in a conference report, which is sent back to both chambers for adoption and cannot be amended in either chamber. The measure cannot be sent to the President until both houses have agreed to the entire text. 

Policy changes attached to appropriations bills are called “riders” and are typically language provisions that prohibit a federal agency from using any funding included in that bill for a certain activity. Policy riders can vary significantly between House and Senate and often complicate the process to the point of preventing the bill’s passage. Given the number of bills, programs, funding levels and other ways there can be disagreement between the House and the Senate, not to mention Congress and the White House, over appropriations bills during regular order, it is not surprising that these bills are frequently past deadline.

If action on one or more regular appropriations measures has not been completed by the start of the next fiscal year (the federal fiscal year starts Oct. 1), the agencies funded by these bills must cease non-essential activities. Traditionally Congress will pass a continuing resolution (CR), which is a short-term spending bill that extends funding for agencies and programs at the previous year’s levels, until action on remaining appropriations measures can be completed. CRs can range from a few days to a couple of weeks, to even a full year. To expedite passage, Congress often resorts to combining all remaining appropriations bills as one combined package called an omnibus bill. The omnibus bill gives members of Congress some coverage to vote for funding the government without necessarily supporting the funding level of a particular program they view as unfavorable and also makes a presidential veto over a particular issue far less likely. Whether appropriations bills are passed separately in regular order, or as a package, the President can either sign the legislation or veto it. A two-thirds vote is required in both chambers to overturn a veto.

As concerns for federal spending, deficits and debts have escalated, limits on current and future spending and creating mechanisms for enforcing these limits were created. The Budget Control Act of 2011 (BCA) granted President Obama a $2.1 trillion increase in the debt limit in exchange for an equal amount in spending cuts in future years. A “supercommittee” failed to find an additional $1.2 trillion in cuts to complete the deficit-reduction package by the Nov. 23, 2011 deadline, thereby triggering automatic, across-the-board cuts known as sequestration. This sequester of funding authority was to begin in 2013 and end in 2021, evenly divided over the nine-year period, with spending on wars and most entitlements like Social Security and Medicaid, as well as discretionary appropriations designated as emergency spending, exempt. Procedures were put in place to allow time for Congressional consideration of appropriations measures that comply with revised limits set by the BCA in order to avoid sequestration.

A two-year budget agreement negotiated last year between then-Speaker John Boehner (R-OH) and President Obama raised 2017 fiscal year limits by $30 billion to $1.07 trillion. Senate Majority Leader Mitch McConnell (R-KY), convinced the votes to pass a budget resolution were not there, has announced the Senate will move forward on FY17 appropriations without a budget. Speaker Paul Ryan (R-WI), committed to returning to regular order, was struggling to find the 218 votes needed for passage when the House left for spring recess on March 23. The law allows for the House to begin consideration of appropriations bills on May 15 in the event Congress has not passed a budget, and they can start sooner by voting to waive that rule. Alternatively, House Republicans are working on a mechanism that could make discretionary funding contingent on enactment of $30 billion in mandatory spending cuts as an amendment to the budget resolution (H Con Res 125) during floor consideration. While that might secure the simple majority votes needed to pass a House budget resolution now, it would very likely lose the votes necessary to pass the annual appropriations bills later and draw a veto.

Leslie Mozingo serves as a federal government relations consultant to the NCACC. Contact Leslie at 202.255.5760 or leslie@strategics.consulting. Website: www.strategics.consulting