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LEGISLATIVE UPDATE FOR MARCH 2, 2017:

Legislative Update


BUDGET AND APPROPRIATIONS
Spending authority for Fiscal Year 2017, which began on September 30, 2016, continues to be provided by a Continuing Resolution (CR) for almost all federal agencies.  Only one of the regular FY 2017 appropriations bills—the Military Construction and Veterans Affairs bill ---has been passed.  The current CR expires on April 28, 2017 and on or before that date it will either need to be extended or the remaining bills will need to be passed to avoid a government shutdown. 

At this writing, the House filed the FY 2017 Defense Appropriations bill authorizing $524 billion in discretionary funding, as well as $68 billion for the war-related Overseas Contingency Operations (OCO) account. The full House of Representatives is expected to vote on the bill the week of March 6. 


 Action on the Defense Appropriation bill is spurring action on the other 10 appropriations bills which also could be passed in an Omnibus bill, or a series of mini-buses. The wrap up of the fiscal 2017 appropriations process is expected to also consider two upcoming supplemental spending requests from the White House.  A defense supplemental is expected to add about $30 billion in OCO spending.

The second supplemental item, for the Homeland Security bill, is expected to add between $12 million and $15 million for President Trump’s campaign promise for a border wall between the US and Mexico. The Department of Homeland Security has identified only $20 million in existing base funding that could be re-directed to the multi-billion dollar project, which together with supplemental funds, would be enough to cover a handful of contracts for wall prototypes.  Recent estimates for construction of the wall are approximately $21 billion.

The Trump Administration’s FY 2018 budget is still under development, although a budget summary is expected to be submitted to the Congress in March.  Early highlights of the Trump Administration’s budget plan include a $54 billion increase for the Department of Defense, which is expected to be offset by an equal reduction in funding for non-defense discretionary (NDD) spending, with the cuts to focus heavily on EPA and the Department of State.  Additionally, the administration wants to increase funding for border security, homeland security, and the Veterans Health Administration, which are all within the non-defense discretionary funding category and will require even more draconian cuts to the remaining non-defense discretionary programs.  In fact, in a recent hearing, House Labor-HHS Appropriations Subcommittee Chairman Tom Cole noted that if President Trump's budget plan to cut $54 billion from NDD were to come to fruition, Labor-HHS could expect a cut of at least $18 to $20 billion since the bill represents about one-third of all NDD funding. "There's no part of this budget that can escape unscathed if we have $18 to $20 billion in reductions," said Chairman Cole.  Due to the drastic cuts necessary to fund the Trump budget proposal, many Members of both parties have declared the Trump budget will be “dead on arrival”.

IS THERE WASTEFUL SPENDING AT DOD?
Advocates for non-defense discretionary programs, such as biomedical research and education, argued successfully during the Obama Administration that parity should be established between defense and non-defense spending, and for each dollar added to defense spending one dollar should be added to non-defense spending. The Trump Administration seems willing to rescind that concept of parity, and though many Members in both parties still believe in parity in “sharing the pain” of sequestration, many seem unwilling to consider looking closely at ways to cut DOD spending.  For example, in January 2015 the Department commissioned an internal study (http://apps.washingtonpost.com/g/documents/investigations/defense-business-board-study-from-jan-2015-identifying-125-billion-in-waste/2236/?ref) which documented up to $125 billion of wasteful DOD spending that could be used to fund higher priorities. The Department quickly buried the study and the Congress has also looked the other way. 


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