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LEGISLATIVE UPDATE FOR JANUARY 24, 2012:

Appropriations and Budget Update


FY 2012 Appropriations
On November 17th the House (298-121) and Senate (70-30) passed H.R. 2112, the Consolidated and Further Appropriations Act for 2012, also known as the “minibus” appropriations bill.  The bill included the following FY 2012 appropriations bills; Transportation, Housing and Urban Development; Commerce, Justice and Science; and Agriculture and FDA.


On December 16th the House passed the nine remaining appropriations bills in a final Conference agreement for H.R. 2055, the Consolidated Appropriations Act for 2012, by a vote of 296-121.  On December 17th the Senate passed the Conference agreement 67-32.  The President signed into law the Consolidated Appropriations Act for 2012 on December 23rd (P.L. 112-74). 


Below are funding highlights included in the final Consolidated Appropriations Act for 2012.


Labor, Health and Human Services
The bill totals $156.3 billion in current year discretionary funding and eliminates 19 programs totaling more than $219 million. This total is $1.1 billion below last year’s level and $24.5 billion below the President’s request.


Department of Health and Human Services – The Department of Health and Human Services is funded at $69.7 billion, which is a decrease of $700 million below the last year’s level and $3.4 billion below the President’s budget request. 


Health Resources and Services Administration – The bill provides $6.4 billion, a decrease of $41 million below FY’2011 funding levels.  The majority of the decreases are in the health professions programs.  There are few increases within HRSA with the exception of the $15 million provided for the AIDS drug Assistance program that provides medications to low-income, uninsured individuals with HIV/AIDS.


Centers for Disease Control and Prevention (CDC) – The legislation includes $6.1 billion for the CDC, an increase of $38 million above last year’s level and $269 million below the President’s budget request. The largest increase in CDC is for the immunizations and respiratory diseases.  The bill includes $579.3 million for this line item, an increase of $100.3 million over the FY’2011 funding level.  The additional funding will allow more immunizations to be available through the existing network of private and public immunization providers, and support and expand the network as needed.


National Institutes of Health (NIH) – The bill provides $30.7 billion for the NIH,  in funding, an increase of $299 million above last year’s level and $758 million below the President’s request. This bill assumes NIH will support the same number of research project grants as last year.   The NIH no longer has the requirement to transfer $300 million into the Global AIDS Program.  Within the total funding is provided for the following Institutes:


National Cancer Institute - $5.1 billion, $23.2 million over FY’2011
National of Allergy and Infectious Diseases - $4.4 billion, $20.5 million over FY’2011
National Institute of Biomedical Imaging and Bioengineering - $338.9 million, $25.1 million over FY’2011
National Heart, Lung and Blood Institute - $3.1 billion, $15.1 million over FY’2011
National Institute of Neurological Disorders and Stroke - $1.6 billion, $7.4 million over FY’2011
National Children’s Study - Bill language is also included providing $193,880,000 for the National Children's Study.


National Center for Advancing Translational Sciences (NCATS) - Also included in the agreement are the elimination of the National Center for Research Resources and the creation of the National Center for Advancing Translational Sciences.   NCATS, funded at $576.4 million, will study steps in the therapeutics development and implementation process, consult with experts in academia and the biotechnology and pharmaceutical industries to identify bottlenecks in the processes that are amenable to re-engineering, and develop new technologies and innovative methods for streamlining the processes. In order to evaluate these innovations and new approaches, NCATS will undertake targeted therapeutics development and implementation projects. In all of these efforts, the conferees expect that NCA TS will complement, not compete with, the efforts of the private sector.


Cures Acceleration Network (CAN) -The conferees provide NCATS with up to $10 million to support the CAN Board and related activities.


Prevention and Public Health Fund – The bill includes $1 billion for this Fund including:
$40 million for epidemiology and laboratory capacity grants
$100 million for tobacco prevention
$35 million for environmental public health tracking


Bioterrorism Advanced Research and Development Authority - The bill provides $415 million, the same level as last year.


Substance Abuse and Mental Health Administration (SAMHSA) – The bill funds SAMHSA at a level of $3.5 billion – $27 million below last year’s level and $73 million below the President’s budget request. Within this total, the Substance Abuse Block Grant program receives $1.8 billion, an increase of $21 million over last year, and the Mental Health Block Grant receives $461 million, an increase of $41 million over last year.


Centers for Medicare and Medicaid Services (CMS) – The bill contains $3.9 billion for CMS Program Management, which is $241 million over last year’s level and $517 million below the President’s request.  Over the last 10 years, the number of CMS beneficiaries (those receiving Medicare, Medicaid and Children’s Health Insurance Program benefits) has increased by 51% – partially due to an aging U.S. population. The bill attempts to keep pace with the increase in beneficiaries to ensure those who rely on these programs receive needed benefits.


Energy & Water Development
The bill provides a total of $32.01 billion for the Army Corps of Engineers, the Department of the Interior, and the Department of Energy.  The funding levels are $328 million above FY 2011 enacted levels.


Department of Energy, Office of Science (OS) – The bill contains $4.889 billion for the Office of Science, $46 million above FY 2011 levels to focus on breakthroughs in energy applications and develop the next-generation high performance computing systems.


Advanced Research Projects Agency-Energy (ARPA-E)-  The bill funds ARPA-E at a level of $275 million, $95 million above FY 2011 levels to develop high-risk promising future energy technologies.

Energy and Efficiency and Renewable Energy (EERE)- Funding for EERE increased $20 million over FY 2011 levels to $1.815 billion to advance solar, biomass, and vehicle technologies.

FY 2013 Budget Process
On January 24, 2012 the President will deliver his annual State of the Union Address before Congress.  The President’s address will lay out a “blueprint for an America built to last” focused on growing the economy and creating jobs.  The President will discuss four “pillars” to support his blueprint including 1) American Manufacturing; 2) American Energy; 3) Skills for American Workers; and 4) American Values.

On February 13, the President is scheduled to release his formal FY 2013 Budget Request to Congress which is one week later than required under the law stating the budget be released the first Monday in February.  On January 9, the President’s Chief of Staff, Bill Daley formally stepped down from that position.  The President appointed Jacob Lew, Director of the Office of Management and Budget, to succeed Mr. Daley as his new Chief of Staff.  On January 17, the President announced that current Deputy Director for Management and Chief Performance Officer Jeffery Zients will serve as Acting Director of the Office of Management and Budget with Heather Higginbottom continuing on as Deputy Director.


With the failure of the Congressional Super-Committee to achieve its goals to address the Nation’s deficit, automatic spending reductions or sequesters are due to begin in 2013.  The White House budget will renew the President’s request to call for lawmaker’s to come up with $1.2 trillion in spending cuts to avoid the sequesters.  If lawmakers were to reach an agreement, they would have to amend the Budget Control Act to turn off the sequester. Unless the law is changed, OMB will implement the sequester in January 2013 that would cut discretionary spending by a projected $97 billion in that year. The law calls for annual sequestrations totaling almost $1 trillion and saving $1.2 trillion, including reduced interest costs, through fiscal 2021.

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