With the release of the President's Budget request on April 10th, the appropriations process for fiscal year (FY) 2014 officially began.
Typically, appropriations season is heralded by the rollout of the President's Budget on the first Monday in February. This year, the Obama Administration delayed its budget request by over two months, preferring to first handle sequestration (the automatic spending cuts of $85 billion) and the extension of FY 2013 appropriations.
With admirable bipartisan cooperation, Congress passed a measure in March to finish out the FY 2013 budget process. The hybrid mini-bus and continuing resolution (CR) included half-year appropriations bills for five of the twelve appropriations subcommittees (Defense, Military Construction-Veterans Affairs, Agriculture, Commerce-Justice-Science, and Homeland Security) and extended CR funding levels for all other accounts. The accounts covered by new bill language get the benefit of newly-adjusted funding levels and updated Congressional directives.
This mini-bus/CR was written to the post-sequester level of $984 billion, reduced from the $1.043 billion spending rate in the first half of FY 2013, to match the level dictated by the Budget Control Act of 2011 (the BCA). The BCA imposed automatic spending caps if Congress could not agree on requisite amounts of deficit reduction.
The BCA has even worse consequences for FY 2014 -- namely, a spending cap of $966 billion, or 1.8% below current levels. Both the House and Senate Budget Resolutions acknowledge the cap of $966 billion, unless other measures are taken to reduce the deficit. Thus, the writing is on the wall -- appropriations will continue to shrink in FY 2014, unless a grand bargain on deficit reduction can be reached. In a time of shrinking resources, private groups and government agencies are refocusing their efforts from pursuing new and additional funding to simply preserving current funding levels in accounts that matter to them.
Despite the BCA's $966 billion cap, Senate Appropriations Committee Chairwoman Barbara Mikulski (D-MD) announced she expects to work from the $1.058 trillion level contained in the President's Budget request. Regardless of whether the eventual top line is $1.058 trillion, $966 billion, or somewhere in between -- Democrats and Republicans will differ greatly on the how to spend the money.
The House and Senate Appropriations Committees set their own "302(b)" allocations, which divvy up the discretionary funds among twelve subcommittees. The House and Senate could set drastically different 302(b)s -- for example, the House could short-change bills heavy on social services to fund other bills at higher levels, or the Senate could squeeze defense-related bills to ensure higher non-defense spending.
Leaders of both Appropriations Committees say they are committed to having "regular order" as much as possible this year -- i.e., passing all twelve appropriations bills through Committee, then through Congress. To get that done, they must try to stick to a traditional appropriations schedule, which involves meeting with constituents and conducting hearings in the early spring, marking up bills in May and June, and voting on bills in June and July. The two-month delay in the budget rollout will compress the time available for hearings and constituent meetings.
This year also represents the first time Chairwoman Mikulski will lead a full appropriations process. Observers noted that she and House Appropriations Chairman Hal Rogers (R-KY) worked well together during the recent CR negotiations. It will be interesting to see if that continues, as Senate Appropriations staff begin to assert her prerogatives and the prerogatives of also-new Ranking Member Richard Shelby (R-AL). It is also the first time House Appropriations Ranking Member Nita Lowey (D-NY) will lead her party through a full appropriations process, although she had a trial by fire earlier this year in helping shepherd the Hurricane Sandy Supplemental Appropriations bill through the House.