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Appropriations and Policy Update

FY 2011 Appropriations Outlook
As Congress returns from the summer recess efforts to pass the regular FY 2011 appropriations bills by the time the new Fiscal Year begins on October 1 has been all but abandoned.  Instead of the regular process the Senate Appropriations Committee is expected to meet and markup the first Continuing Resolution (CR) during the week of September 27.  It is likely that the first CR will extend until mid November and several additional CRs will be requested before an Omnibus bill can be approved.  Many have hoped for a clean CR to extend the current funding rate and to include only technical fixes.  The Administration however, has requested several items, including:

• $5.2 billion for the President’s Race to the Top education initiative  
• $700 million for the Pakistan Counterinsurgency Capability Fund
• $624 million for the National Nuclear Security Administration
• $800 million to Child Care and Development Block Grants

Democrats in the Senate are also floating the idea of adding $2.5 billion to the CR to continue a job subsidy program (the Temporary Assistance for Needy Families welfare program) that was included in the stimulus package and is set to expire on October 1.  The necessary 60 votes needed to pass a CR in the Senate will likely result in some political posturing on the overall spending levels for FY 2011.  An amendment is likely to be offered by Senators Claire McCaskill (D-MO) and Jeff Sessions (R-AL) to cap discretionary spending to a level $20 billion below the Administration’s request for FY 2011.  Republican leaders have also requested that the CR spending level be set at the FY 2008 levels.

The CR is expected to extend funding for Federal agencies through the November election and cover all appropriations bills.

Other Legislation
While a stopgap spending bill must be passed prior to October 1 to keep the government in operation, Congress is likely to consider legislation to extend the Bush Administration’s tax cuts which are set to expire on December 31.  The current Administration’s plan is to extend the tax cuts for individuals making less than $200,000 and couples earning less than $250,000 per year.  The plan has the support of most Democrats in the House and Senate, but it is unlikely a bill will be brought up for a vote prior to the November elections.


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