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The FY 13 budget and appropriations process continues in earnest
this week with a number of House committees holding mark-ups to
conform to reconciliation instructions included in the House-passed
budget resolution, which went further than the August 2, 2011
compromise struck under the "Budget Control Act" (aka BCA
or "debt deal"). Reconciliation instructions are
contained only in budget resolutions and direct one or more
committees to develop and submit bills that change spending,
revenues, and/or the debt-limit so they align with the budget
resolution. In total, six committees are working to identify
– by April 27th – $261 billion in savings that
will be spread over a ten year time frame. This amount will result
in Congress enacting both the equivalent of the first-year of
sequester plus additional spending cuts beyond those of the BCA.
The last time Congress enacted a reconciliation bill was in
conjunction with the passage of health care reform in 2010.
Last week, the Ways and Means Committee reported out a bill that
reduces spending over ten years by $53 billion. The cuts are
comprised of: the elimination of the Social Services Block Grant;
rescinding the child tax credit; and defunding the subsidies in the
Patient Protection and Affordable Care Act (aka health reform).
Tuesday, the Energy and Commerce Committee began work on its
measure, which will reduce spending by $98 billion over ten years.
Items expected to be on the chopping block include: grants for
state exchanges (the funds that have not yet been spent/obligated);
the Public Health and Prevention Fund (it likely will be eliminated
entirely); and Medicaid DSH (rebasing allotments starting in FY
22).
Once all six committees have marked-up and reported their
respective bills, the House Budget Committee will weave all the
proposals and cuts together and report a single measure out to the
full House, which is expected to consider the omnibus spending cut
package in May. It is important to note that the Senate is unlikely
to do anything similar as both Senate Democrats and Republicans
have indicated their preference for sticking with the BCA numbers
– at least for now. Senate Majority Leader Reid
previously announced he is not bringing a budget measure to the
Senate floor because FY 13 spending caps were previously set by the
BCA. As such, there are no movements afoot in the Senate for a
budget or reconciliation at this time. Therefore the Senate has
leapfrogged over the budget and moved straight to moving the FY 13
appropriations bills, which taken all 12 together fund all the
activities of the government.
Last week President Obama issued a veto threat for any
appropriations measures that cut funding further than BCA amounts.
While Senate Democrats are holding to the BCA numbers because they
want to safeguard programs, Senate Republicans indicate they are
sticking to the BCA numbers in an effort to move appropriations
bills through the chamber on the front end, with the hope that they
can negotiate further cuts in conference at the end of the annual
process.
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