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LEGISLATIVE UPDATE FOR AUGUST 4, 2011:

Appropriations and Policy Update


The Budget Control Act of 2011-after a long debate the Debt Ceiling is raised:

After a long and dramatic debate, both the House and Senate passed the Budget Control Act of 2011 providing for, among other measures, a debt ceiling increase thereby avoiding a default on the Nation’s financial obligations. The bill was signed by the President on August 2, 2011. 

The bill establishes a two-step increase in the federal debt-limit ceiling, beginning with a $900 billion increase immediately and an additional $1.2 trillion - $1.5 trillion increase, to become available at the president’s request. The agreement puts off any need for future increases to the ceiling until after the November 2012 elections.  At this point, it also does not include any cuts to entitlement programs such as Medicare and Medicaid, nor does it increase tax revenue. 
 
Reductions in the federal deficit would be accomplished by imposing a cap on total spending for discretionary programs through 2021. This would produce savings of an estimated $917 billion over 10 years. For 2012 and 2013, separate caps would be imposed on defense and non-defense programs to prevent shifting funds from one to the other. The caps for 2014 – 2021 would not segregate security and non-defense spending.

A second round of spending cuts, as much as $1.5 trillion over 10 years, is to be identified by a Special Joint Committee of the Congress.

The House and Senate must vote on the Joint Committee’s recommendations without amendment by November 23.   If the House and/or Senate fail to approve the Committee’s recommendations, across-the-board cuts of $1.2 trillion will be triggered automatically. Those cuts would be divided equally between defense and non-defense programs.

The bill also requires the Congress to vote on a balanced budget amendment no sooner than October 1, 2011 and no later than December 31, 2011.  If one chamber passes a balanced budget amendment the other chamber would be required to consider it.

Below is the timeline for action by the Special Joint Committee:

August 16, 2011 - Joint Commission members are appointed. (3 Democratic Senators, 3 Republican Senators, 3 Republican Representatives, 3 Democratic Representatives)

September 14, 2011- The first Joint Commission meeting is to be 45 days after the bill passes.

October 14, 2011 - Each Senate& House committee may send Joint Committee recommendations for changes to reduce deficit by at least $1.5 trillion.
 
November 23, 2011 – The Joint Commission votes on:
1) The report containing a detailed statement of the findings, conclusions, and recommendations and the estimate of the Congressional Budget Office; and
2) Proposed legislative language.
 
December 2, 2011 - If the Joint Committee reaches agreement by a majority vote it then submits a report with legislative language to the President, Vice President and the Hill.
 
Next legislative day– The Joint Committee's legislative language is introduced in the Senate and the House.
 
December 9, 2011 - Any House and Senate Committee to which the Joint Committee's language is referred must report it to the House and Senate without amendment.  If Committees fail to report by this day, the bill will be automatically discharged to the House and Senate.  In the Senate, the motion to proceed is not debatable.  Consideration and debate is  limited to 30 hours.  No amendments are in order.  
 
December 23, 2011 - Vote on Joint Committee bill in both House and Senate.

January 21, 2012 - The Joint Committee sunsets and goes out of business.

FY 2012 Appropriations
Now that the debt ceiling debate has been resolved, the fiscal year (FY) 2012 appropriation process will proceed in September when the Congress returns from the August recess.   Under the debt ceiling deal, the discretionary spending cap for FY 2012 is $1.043 trillion, which is a $7 billion less than current FY 2011 level. This is $23 billion more than the House FY 2012 budget resolution which the House 302b spending ceilings have been based on and the compromise will therefore allow for more discretionary spending than is currently being considered in the House appropriations bills.  This means that for the bills that have not yet been marked up in the House, their 302(b) caps will be higher than originally set by the House Budget Resolution (for the bills that have already been reported, the increase in their caps will be dealt with when the bills go to conference with the Senate). 

Senate Appropriations Chairman Daniel Inouye (D-HI) has already begun drawing up a time frame for Subcommittee markups to begin when the Senate returns from recess.  The Labor-HHS-Education Subcommittee markup, for example, is expected to occur in the second week of September.  At this point, only one of the 12 spending bills, the Military/Veterans bill, has seen any action in the Senate.  In the House, of the 12 bills, six have passed, an additional three have been reported out of Committee and are awaiting floor action, and there are three left to be marked up.  The three that still need to be marked up include Labor-HHS-Education, Transportation and Foreign Operations.  In the Senate, only the Military Construction bill has been marked up and reported out of Committee and was passed by the full Senate on July 20.

The agreement reached permitting passage of the Budget Control Act of 2011 essentially establishes the 302a spending ceiling for the Appropriation Committee and also establishes within this overall ceiling an amount that may be allocated for defense and for non-defense programs. This overall ceiling and the sub-ceilings for defense and non-defense spending should greatly facilitate the process for the Committee. While the various appropriations subcommittees will still need to reach agreement on how to meet their respective spending targets, and while it is always possible for congressional Members to try to hold up the FY 2012 spending bills over extraneous policy riders or other matters, the legislation significantly reduces the chances of a sequel to last spring’s government shutdown drama.

Status of FY 2012 Appropriation Bills 

  HOUSE

  Appropriations                      Subcommittee          Full Committee           Floor

  Subcommittee                       Markup                    Markup                      Action

Agriculture

DONE

May 24

DONE

May 31

PASSED

June 16

Commerce, Justice and Science

DONE

July 7

DONE

July 13

Defense

 

DONE

June 1

DONE

June 14

PASSED

July 8

Energy & Water

DONE

June 2

DONE

June 15

PASSED

July 15

Financial Services

 

DONE

June 16

DONE

June 23

Homeland Security

DONE

May 13

DONE

May 24

PASSED

 June 2

Interior & Environment

 

DONE

July 7

DONE

July 12

Labor, Health and Human Services

Legislative Branch

DONE

July 7

DONE

July 13

PASSED

July 22

Military Construction/ Veterans Affairs

DONE

May 13

DONE

May 24

PASSED

June 14

State & Foreign Operations

Transportation/Housing and Urban Development

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