APA Federal Budget Blog: 2013

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December 13, 2013

House approves budget deal: Senate approval expected
Putting the agreement in context. 

The House voted 332 to 94 on Dec. 12 to approve a two-year budget outline, the Bipartisan Budget Agreement (BBA), that would partially overturn the sequester and introduce a bit of predictability to a federal budget process that has repeatedly broken down over the past three years. The Senate is expected to approve the agreement the week of Dec. 16.

Observers are praising the modest agreement as a sign, after several years of acrimony, that the two parties can work together to shake off the worst effects of congressional gridlock. For one thing, it must be seen as progress that a majority of the House Republican caucus voted to approve a deal that included revenues from sources other than spending cuts. While many Democrats were dissatisfied with the scope of the deal, and the fact that it didn't include an extension of unemployment benefits, which are due to expire Dec. 28, a majority of that party also supported the BBA.

To call the BBA a “modest” deal almost exaggerates. As you can see in the summary blog entry below, it adds funds to cover less than half of the costs of sequestration for the current fiscal year. But that modest bit of relief ($22.5 billion additional is available for non-defense discretionary programs such as scientific research) is very welcome.

This will be the last blog update until the new year (the APA website is undergoing revisions til then). Thanks very much for walking through the budget weeds with us in 2013. We will be back online in January.

December 12, 2013

Conference committee reports budget deal
Agreement will pay down but not eliminate sequester.

The House-Senate budget conference committee headed by Rep. Paul Ryan, R-Ohio, and Sen. Patty Murray, D-Wash., announced an agreement the evening of Dec. 10 that will allow for an increase in federal spending and for modest deficit reduction. As you may recall, the agreement that ended the 16-day federal government shutdown authorized this conference committee to set a top-line number — in other words, to determine whether the House budget, Senate budget or some figure in between, would govern how much the 13 appropriations committees have available to spend for fiscal year (FY) 2014. A primary reason that none of the spending bills have passed both chambers of Congress this year is lack of agreement on a budget. The conference committee opted to split the difference between the House- and Senate-passed top line numbers.

The $85 billion agreement, known as the Bipartisan Budget Agreement, or BBA, would partially repeal the sequester. It includes $63 billion that will reduce the size of the automatic cuts, and will prevent the $19 billion cut due to hit the Pentagon in January. The BBA will increase discretionary funding (that is, subject to annual appropriations) to around $1.012 trillion in FY 2014 and $1.015 trillion in 2015 up from FY 2013 post-sequestration funding of $987.5 billion. To offset the spending, the $63 billion would come from modest changes to several laws, including cuts to government contributions to federal worker pensions, higher security fees for the nation's airline passengers and cuts in future spending. Details can be found in a summary (PDF, 94KB) published by the conference committee.

The BBA would reduce the budget deficit by between $20 and $23 billion. It would ease the automatic spending cuts known as sequestration by $45 billion in 2014 and about $18 billion in 2015. The agreement replaces some but not all of the spending cuts due to take place: $64.6 billion in cuts would still take place in 2014 and $90.9 billion in 2015. The appropriations subcommittees would determine how the cuts, and new revenue, would be applied in each spending bill.

The BBA is scheduled for a vote in the House on Thursday, one day before that chamber recesses for the year. The Senate will vote next week. The agreement has been attacked by some conservative organizations, including the Club for Growth, for not including enough deficit reduction, and some Democrats are criticizing the deal because it does not stop the expiration of benefits for the long-term unemployed (those benefits will expire on Dec. 28). So issues remain on the table that could complicate the finalization of any agreement, but most observers expect both houses to approve the agreement.

In the coming days if the agreement is adopted, several of the FY 2014 appropriations bills will come up for a vote. Those bills will provide additional information about how research and education accounts will be impacted by the new top-line numbers. We at the Federal Budget Blog will continue to provide information about how research funding agencies will be affected. Bottom line — most agencies will have more money than last year, and all will have more certainty about their budgets for the next year and a half.

November 20, 2013

APA CEO calls on budget conferees to overturn sequestration
Calls on Congress to protect critical investments in research and anti-poverty programs.

Working against a late November deadline, and in the face of entrenched partisan differences, a House-Senate conference committee is meeting to negotiate the final budget ceiling, which dictates what the level of spending will be in fiscal year 2014. The American Psychological Association's CEO Norman Anderson, PhD, has written the conferees (PDF, 139KB), urging them to replace sequestration with a deficit reduction plan that allows for sustained investment in critical nondefense discretionary (NDD) programs (such as scientific research, education and public health).

Anderson's letter makes a strong case against sequestration. "These cuts have dealt devastating blows to key government programs that make our nation a world leader. As psychologists who provide mental health services, teach in universities, manage public health programs, and conduct research, we see the effects of sequestration all around us. Critical research sits on-hold; a generation of young researchers is being driven away by the lack of career opportunities; senior investigators are leaving research altogether; and prior investments in science are being undermined. Grants for mental health services and training for health care professionals are endangered. Low-income communities suffer from cuts to housing, food assistance, child care, Head Start, and other essential safety net programs. These cuts also slow economic growth and worsen unemployment."

Anderson concludes, "APA supports a balanced approach to deficit reduction, one that does not rely solely on spending cuts and that treats defense and non-defense programs equally. Sequester replacement should also protect low-income programs so that poverty and hardship are not increased, and it should strengthen the economic recovery and expand opportunity."

APA has also cosigned a letter (PDF, 40KB) by the Ad Hoc Group for Medical Research Funding that focuses on sequestration's impact on the National Institutes of Health (NIH).

In the agreement that ended the federal government shutdown in mid-October, Congress funded a continuing resolution that would pay for government services through Jan. 15. The agreement called for a budget conference committee to set a budget ceiling so that Congress may pass individual appropriations bills (such as the Labor-HHS-Education bill that funds the NIH). That conference is required to report its resolution by Dec. 15, although appropriations subcommittee chairs in the House and Senate have asked the committee to report by Thanksgiving so that they have time to bring spending bills to the floor. Additional sequestration cuts of $20 billion, which will primarily affect defense programs, are set to fall in early January if Congress does not pass legislation that delays or overturns them.

November 12, 2013

APA joins major advocacy push against sequestration
Automatic budget cuts have hit science — and other programs — hard.

When Congress mandates an across-the-board cut for everything from scientific research to national parks to special education, its impact goes far beyond numbers on a page. It's a veteran in Iowa struggling to find a stable home. It's a child in Central Point, Ore., going without Head Start and a man living with AIDS in Nashville, Tenn., who will no longer receive the care he needs.

Some 3,200 national, state and local organizations, including APA, have joined together to help give Congress the big picture: how the automatic budget cuts known as sequestration affect so many of the programs that Americans depend on. The coalition is called NDD United, because it focuses on the impact of automatic budget cuts on "non-defense discretionary" programs — scientific research, public safety, public health, education — which comprise less than one fifth of the federal budget, a proportion that continues to shrink.

That's why "Faces of Austerity: How Budget Cuts Have Made Us Sicker, Poorer, and Less Secure (PDF, 12.6MB)," the new report from NDD United, is so important. "Faces of Austerity" shines a light on the people behind the programs being cut as a result of Congress's dysfunctional budgeting process. The report is the first of its kind: a comprehensive, sector-by-sector look at what's happening far from Washington noise, on the ground across the country where seniors, children and families have been devastated by national budget cuts.

The report quotes psychologist Steve Warren, vice chancellor for research at the University of Kansas, from an interview he did with The Huffington Post in July. "It is like a slowly growing cancer," he said, speaking of sequestration. "It is going to do a lot of destruction over time. You are going to see people's careers end early on — assistant professors, associate professors. They will never get that grant at that critical time, and they're gone. You are going to see promising graduate students not be promising graduate students, and just leave. And it will play out over a period of many years."

The report highlights the work of people like Cheri Taylor, executive director of Pottersville (Calif.) Adult Day Services, which serves low-income clients with Alzheimer's disease or other dementia. Says Taylor, "These… programs allow people with Alzheimer's disease to remain in their homes longer and provide needed respite to their family caregivers. Any 'savings' from sequestration would pale in comparison to the added costs resulting from unnecessary hospitalizations, premature nursing home placements and greater financial and emotional strains on family caregivers."

Email or tweet the link (PDF, 12.6MB) to your member of Congress.

November 8, 2013

Budget conferees meet
Several proposals floated, but each has determined opponents.

The budget conference committee established as part of the deal to end the government shutdown met on Oct. 30. As each of the 29 members made opening statements, it was clear that there are still strong fault lines that must be bridged before any agreement is reached. By Dec. 13, conferees must agree on the "top line number" between the House-passed $967 billion and the Senate's figure of $1.058 trillion, which will allow the Appropriations Committee time to complete work on the unfinished funding bills by Jan. 15. 

Both chairs of the House and Senate Budget committees suggested that the conference focus not on a sweeping budget fix but on a smaller agreement to replace the Fiscal Year (FY) 2014 sequester cuts set to go into effect on Jan. 15. On that day, in the absence of a deal, the overall spending cap will drop from $986 billion to $967 billion. Senate Budget Committee Chair Patty Murray, D-Wash., is seeking ways to avoid a new round of cuts, and many Republicans also hope to avoid them. Rep. Hal Rogers, R-Ky, chair of the House Appropriations Committee, said in July that he cannot legislate under the sequestration caps. Since the FY 2014 reductions would come almost solely from defense spending, many believe Republicans will be more inclined to offer concessions. Those cuts would set the Pentagon's base budget at about $475 billion, which is roughly $20 billion less than its current funding and $50 billion less than the Department of Defense asked for in its FY 2014 budget request.

You may recall that the House-passed budget assumed sequestration would happen in FY 2014, while the Senate budget assumed sequestration would be repealed. The $100 billion question (the approximate amount needed to close the gap between the Senate and House budgets) is where to find enough savings.  Democrats on the committee suggested raising additional revenue by eliminating some tax expenditures; that is, closing tax loopholes.  Some of the loopholes under discussion are: tax subsidies for yachts or vacation homes; tax-deferment of IRA contributions; and deduction of expenses involved in moving jobs from the U.S. to overseas. Meanwhile some Republican conferees would prefer to generate revenue by making changes to entitlement programs, and others seem satisfied with sequestration as a mechanism for deficit reduction. The conference committee will meet again on Nov. 13, likely to discuss broad proposals.

In news on sequestration's impact, NIH has updated its estimate of how many fewer grants it would be able to fund in FY 2013. The initial estimate posted on June 3, 2013, was 700. On Nov. 4, 2013, NIH posted the updated number. Actual competitive research project grants NIH was unable to fund: 640.  While that isn't a lot to celebrate, we are happy about the additional 60 grants that weren't lost.

October 23, 2013

Budget talks move out of the headlines for a while
As dust settles from shutdown showdown, sequestration is back on the table.

Now that the federal government has reopened and the threat of financial default has been tamped down for a few months, it’s time to take stock and see how the research funding agencies are managing. We also want to answer that burning question: Will the conference committee do something about sequestration?

First, recall how the mess was resolved. The deal brokered by the Senate and accepted by the House allows the government to be funded through Jan. 15, 2014 at "sequestration levels;" that is, without removing any of the cuts that have already been made. The debt limit was extended through Feb. 7. A budget conference has been established to negotiate a long-term spending plan with a target date of Dec. 13, 2013. The deal included back pay for furloughed federal workers and a provision to verify incomes of people who apply for subsidies under the Affordable Care Act.

So how are research funding agencies recovering from the unscheduled work stoppage? Sally Rockey, who is in charge of extramural research at NIH, said in her blog, “Because of the shut-down, over 200 review meetings had to be canceled and thousands of reviewers had to change their travel plans. More than 11,000 applications were affected by these cancellations. The shut-down also affected many of our major deadlines, including the October R01 deadline. Due to the shut-down timing, it is extraordinarily complex to reschedule all these deadlines and reviews. We have just published a guide notice explaining how we will proceed." See more on the website.

Acting National Science Foundation (NSF) Director Cora Marrett, in a note (PDF, 22KB) to the scientific community, declared: "The collective impacts of the funding lapse and sequestration will ripple across the scientific community for the foreseeable future, hindering the science and engineering progress so vital to our nation's future prosperity."

NSF has resumed accepting proposals through its FastLane system, although the foundation expects to announce revised due dates for those proposals whose deadlines were between Oct.1 and 25. Some revisions have already been announced (PDF, 54KB) and scientists are urged to contact program officers for additional information.

Sequestration is getting more attention as the House-Senate budget conference committee meetings begin. Budget Committee leaders Sens. Patty Murray, D-Wash., and Jeff Sessions, R-Ala., and Reps. Paul Ryan, R-Wis., and Chris Van Hollen, D-Md., have begun discussing how to proceed in the first budget conference since 2009. According to a report in the New York Times, instead of discussing a large deal with “significant new tax revenues and large-scale changes to Medicare, Medicaid and Social Security,” “they agreed, the talks will aim at a more modest, confidence-building measure to replace the sequestration cuts in 2014. Negotiators could aim higher, for a deal saving at least $1 trillion over the next nine years to substitute completely for the arbitrary sequestration cuts. But neither side was hopeful of that."

APA is an active participant in the NDD United Coalition, which advocates on behalf of the budgets of non-defense discretionary programs. In mid-November the coalition will release an important report on the impact of sequestration that will arm organizations in the coalition for a new round of advocacy in support of repealing sequestration. Stay tuned for more details.

October 16, 2013

So this is the real deal—House and Senate to vote on proposal to avoid default, reopen government
Default drama down to the wire with vote margins uncertain.

Senate Majority Leader Harry Reid, D-Nev., announced just after noon on Oct. 16 the results of an agreement with Minority Leader Mitch McConnell, R-Ky., that would reopen the government and raise the debt ceiling.

The version announced by House Speaker John Boehner, R-Ohio, on Tuesday, Oct. 15, was pulled from the House floor before a vote, presumably because it did not have enough votes to pass. Attention then shifted back to the Senate, where an agreement similar to the proposal announced yesterday will soon be introduced as S. 1569.

The Senate proposal would reopen the government, funding it until Jan. 15. It would also raise the debt limit until Feb. 7 to avert a first default on U.S. debt obligations. It also would require the House and Senate to name conferees for budget negotiations to reach a long-term spending accord. The plan does not include major concessions on President Obama’s signature Affordable Care Act, but does require greater steps to verify the incomes of individuals who apply for subsidies under that law. The bill also includes a provision requiring a proactive vote to disapprove extending the debt limit. This is referred to as the McConnell language, and if adopted may make it less likely that the debt ceiling votes can be used as political footballs.

The APA Science Government Relations Office has sent an Action Alert encouraging psychologists to email their members of Congress Wednesday afternoon in support of ending the government shutdown and avoiding a default. While the announcement of a bipartisan deal in the Senate is good news, it is not clear how the measure will fare in the House, so it isn’t too late to weigh in.

Stay tuned for further developments!

October 15, 2013

Emerging House and Senate proposals to end shutdown and avoid default
Big question as clock ticks: Can the two proposals be reconciled?

As of noon on Oct. 15, both the Senate and House are preparing proposals that would end the government shutdown and raise the debt ceiling to avoid a potential default on Oct. 17.

The Senate is putting finishing touches on a proposal that is reported to extend federal borrowing authority until Feb. 7, reopen the government and fund federal agencies through Jan. 15, 2014. The proposal includes authorization for a new round of talks over broader budget issues that could produce a plan to replace the next round of automatic spending cuts (i.e., the sequester) before Jan. 15. The next round of sequester cuts is scheduled to take an additional $20 billion out of federal agency budgets, primarily from the Pentagon. (The Federal Budget Blog entry below from Sept. 20 explains why the cuts in 2014 are set to come primarily from defense.)

The Senate framework includes minor changes to the Affordable Care Act (ACA). It adds new safeguards to ensure that people who receive federal subsidies to purchase health insurance under the law are eligible to receive them based on their income. The proposal may also include a delay of a $63 per person tax on people whose previous insurance policies would continue under the ACA, the so-called “belly button tax.”

This morning the House Republican leadership announced a separate proposal, one that would also reopen the government through Jan. 15 and lifting the debt ceiling through Feb. 7. However, the House proposal would make more extensive changes in the ACA. In addition to requiring new income verification standards for those seeking to qualify for health insurance subsidies, as the Senate proposal also does, it would delay the ACA’s medical device tax for two years and require that members of Congress, the Cabinet and the president forego subsidies for their health insurance. It also would authorize a budget conference with a Dec. 15 deadline, two days longer than the Dec. 13 deadline in the Senate plan. The House proposal would also prohibit the use of special measures to extend the Treasury Department’s borrowing authority past Feb. 7. The proposal would ensure a firm deadline for the next debt-limit increase, with no flexibility for the Treasury Department’s “extraordinary measures.” The White House seems very unlikely to give up any flexibility to manage the nation’s finances. The House proposal received a mixed response even among members of the Republican caucus.

The positives: At least there are proposals now. And the two proposals have several similarities. The negative: time is running out on the Oct. 17 default deadline. If the Senate is able to bring its proposal to the floor and pass it Tuesday, and — a bigger “if”— the House can pass its proposal, there is, in theory, time to work out differences. But will a skeptic such as Sen. Ted Cruz, R-Texas, use delaying tactics to block consideration of the Senate proposal? And assuming the House and the Senate are each able to pass their individual proposals, will either body agree to the changes that would lead to an agreement the president can sign? Stay tuned!

October 11, 2013

House Republicans offer deal to delay U.S. default
Negotiations between White House, Congress to continue through weekend.

Blog readers can be forgiven any confusion about which self-inflicted federal disaster to read about first, but the news took a bit of a turn yesterday. President Obama has begun talks with House Republicans about their proposal to raise the federal debt limit for six weeks (until late November) in exchange for beginning negotiations on longer-term budget issues. The House majority did not offer a plan to end the federal shutdown or the sequester. The president “didn’t say yes and didn’t say no,” according to House Budget Committee Chairman Paul Ryan, R-Wisc., and continues to insist that Republicans reopen federal agencies before negotiations can begin on broader budget issues. So while that still sounds like a continuation of the stalemate, the fact that the two parties are talking about talking has to be seen as a positive step.

While a specific proposal has not been released, CQ News: CQ Morning Report says that Republicans appear to be moving toward a hybrid solution that combines reopening the government with an increase in the debt ceiling that would be tied to broader budget negotiations. U.S. Sen. Susan Collins, R-Maine, is floating a plan to do both, and that would also repeal or delay the Affordable Care Act’s medical device tax, as well as provide agencies two years of additional flexibility to manage sequestration’s automatic spending cuts. President Obama is meeting today with Senate Republicans.

Meanwhile, the Senate may vote as early as Saturday on the terms of debate for a measure that would raise the debt limit. Majority Leader Harry Reid, D-Nev., wanted to have a ”clean” measure ready in the event that other negotiations don’t bear fruit in time to avoid default. As if you could forget, Oct. 17 is the date on which, according to the U.S. Treasury, the U.S. can no longer borrow funds to meet its statutory obligations.

In many ways the interruption of university-based research has been the face of the shutdown. Here’s good article from Politico about the negative consequences of the federal government shutdown on federally funded research at U.S. academic institutions. The article, “As shutdown continues, university research doesn’t,” features graduate student Jeffery Mayse, a behavioral neuroscientist in the lab of psychologist Michaela Gallagher at Johns Hopkins University.

We here at APA want to know how the shutdown is affecting you; email us with your stories.

October 8, 2013

Yet more notes from the shutdown (day eight): Spotlight on defense
Most DoD-funded research proceeding despite shutdown.

Secretary of Defense Chuck Hagel called back to work about 90 percent of the 350,000 furloughed defense workers this week. Attorneys for the departments of Defense and Justice concluded that a new interpretation of the Pay Our Military Act allows the Department of Defense to eliminate furloughs for employees whose positions contribute to the readiness, morale and well-being of service members.

Most research funded by the Department of Defense has not been affected by furloughs, but some information functions may not be operational. For example, the U.S. Office of Naval Research (ONR) Facebook page is active, but the Air Force Office of Scientific Research (AFOSR) Twitter and Facebook are not being updated. The Army Research Institute for the Behavioral and Social Sciences has not been impacted by furloughs, but some functions at the Army Medical Research and Materiel Command (MRMC) may be. The message on the MRMC website notes, “Today many of our furloughed Civilian workforce were recalled to duty. We received very specific guidance as to what positions could return. Although a large portion of our workforce is on duty, it is NOT business as usual.”

You may have read that the House passed a bill to guarantee back pay to federal workers who have been furloughed. Although the bill has not been considered in the Senate, they are said to support it. That said, Harry Reid, D-Nev., the Senate majority leader, will not schedule such a vote in the Senate without a sure 60-vote margin to cut off debate (cloture). The Senate rules allow wide latitude to minority members to prolong debate and offer amendments, so there is always a “cloture calculus” before any bill is considered.

A few questions for our Budget Blog readers: Is your member of Congress accepting a salary during the government shutdown? Many are refusing their salaries or making arrangements to donate the amount of their paycheck. See this running tally in the Washington Post.

In case you missed it, here is a useful article from Pew Research about federal government statistics and reports that are affected by the shutdown. We here at APA want to know how the shutdown is affecting you; email us with your stories.

October 4, 2013

More notes from the shutdown
What is and what may be.

On day four of the federal government shutdown, we are reminded of the many ways in which federal services are threaded throughout ordinary civilian lives. Jog on a federal trail? It’s probably closed. Waiting for the federal jobs numbers that are released on the first Friday of every month? Sorry, the Bureau of Labor Statistics staffers who compile that report are furloughed. Want to call your member of Congress to complain about the shutdown? Your call may or may not be answered, depending on whether the office is open or closed. Congress is still in session, yet the government is shut down, and congressional offices have responded in different ways. Some offices sent staff home; some are operating with a reduced number of staff; and some appear to be operating as usual. For example, Illinois Sen. Mark Kirk's offices in Illinois and Washington, D.C., are fully staffed while Sen. Dick Durbin has closed his offices. The offices of U.S. Rep. Nita Lowey, D-N.Y., are open in D.C. and New York. Offices of U.S. Sen. Kelly Ayotte, R-N.H., are open with reduced staff. The offices of U.S. Sen. Tim Kaine, D-Va., are closed.

That’s “what is.” In the category of “what may be,” we here at the APA Federal Budget Blog are no better at prognosticating than others, but we read a lot, so we can share a bit of distilled conventional wisdom with you. Currently, there are enough votes in the Republican caucus, when added to the likely number of Democratic votes, to pass a continuing resolution (CR) out of the House of Representatives without Affordable Care Act riders. However, if House Speaker John Boehner, R-Ohio, were to schedule that vote, he would alienate the more conservative members of his caucus just as he needs to marshal enough votes in the House to pass an increase in the debt limit (deadline, according to the U.S. Treasury Department: Oct. 17). Given that a U.S. default on its debts would be by far the more damaging financial outcome, if the speaker has just one “get out of crisis free” card, he will play it with the debt ceiling. One possible strategy is that the CR and the debt limit resolution will be bound into one very important vote that would take place in mid-October. This strategy may only work if the White House and Democrats concede the issue of spending: That is, they would accept the House-level number of $967 billion, which is lower than the Senate and the president have proposed. Without that concession, at a minimum, it is difficult to imagine the speaker emerging from such an enormous, costly standoff with all of his limbs, not to mention his speakership, intact.

The Conventional-Wisdomers debate whether the shutdown can possibly end before the debt ceiling is raised. While we cannot answer this question, almost nobody thinks it will go on beyond the debt ceiling fix. Good thing, too – because even if closed jogging trails and delayed economic reports don’t seem dire, the negative consequences will start piling up soon enough. Consider:

The Department of Veterans Affairs is continuing to pay disability claims and pension payments, but without a new appropriation, it will run out of money for those essential services if the shutdown lasts more than two or three weeks. Also, the “essential” government employees who remain on the job doing important things like air traffic control will be due their next paycheck around Oct. 11. At that point the shutdown will affect 1.3 million more workers, excluding active duty military, who will be paid on time.

Please share your stories about how the federal shutdown is affecting you and your work. Write to your blogger today — we want to hear from you!

October 2, 2013

Notes from the shutdown
Legislation in House to partially restore government funding is resisted by Senate.

Much of the federal government has closed up shop and nearly 800,000 federal workers across the country have been furloughed. National parks and monuments are closed. The websites at several federal agencies, including the National Science Foundation, are offline, replaced by guidance about what the shutdown means for grantees and others. 

President Obama has invited congressional leaders to the White House to discuss the passage of a ”clean” continuing resolution or CR (funding for the government without extraneous legislation attached) and the need to raise the debt ceiling by mid-October. In the meantime, observers are counting the number of House Republicans who have said they are willing to vote for a clean CR. If Speaker of the House John Boehner, R-Ohio, were willing to break with the more intransigent elements in his caucus, he could bring up a funding resolution that would pass with Democratic votes plus enough Republican votes to put it over the top. Historically, however, House speakers do not like to bring up legislation that less than half of their caucus supports: That maneuver breaks the “Hastert Rule” named for former Speaker Dennis Hastert, R-Ill. 

It appears the House leadership has a few more cards in its hand, however. The House will vote Wednesday afternoon on five resolutions that would fund portions of the government through Dec. 15, 2013. One would allow some of the national parks and Smithsonian museums to reopen. One would pay for some veterans’ health care. One would allow the District of Columbia, whose budget is largely self-funded but has a federal component, to use its own funds to operate. The D.C. government is operating now by using contingency funds. Another bill would pay military reservists. A fifth bill (PDF, 74KB) would reopen the National Institutes of Health. House and Senate Democrats oppose this piecemeal strategy, and are holding out for a comprehensive solution to the budget crisis. President Obama has threatened a veto if any of the bills should reach his desk. The bills are expected to pass in the House. Stay tuned for further updates!

September 30, 2013

Lights out on Oct. 1?
Funding bills are still "in play" between House and Senate.

Today, Sept. 30, 2013, is the last day of fiscal year 2013. As most readers of the APA Federal Budget Blog know, a new funding bill must be passed by both houses of Congress and signed by the president no later than midnight to prevent the government from shutting down for lack of funds.

A few moments ago the Senate rejected a House-passed bill that would have funded the government through Nov. 15, delayed implementation of the Affordable Care Act for a year and repealed the Affordable Care Act's tax on medical devices. The ball is back in the court of the House of Representatives. Congressional Quarterly is reporting that the House will next send to the Senate a stopgap spending measure, plus a provision to delay for a year the Affordable Care Act's mandate that individuals buy health insurance, end federal contributions to members of Congress and their staff members' insurance, and add a requirement that executive branch political officials purchase health insurance in the exchanges set up by the law. These changes to the Affordable Care Act have been rejected by Democrats before, and there is no indication the Senate will welcome this latest package.

It appears the House leadership is hoping to extend its brinkmanship into the evening. The Democrats in the Senate seem united in refusal to accept any bill but a "clean" continuing resolution (just funding, no other legislation) so if the House pursues its quixotic quest to defund or defenestrate the Affordable Care Act, Oct. 1 will be an unpaid holiday for many, many federal workers.

The American Association for the Advancement of Science (AAAS) sent an update today about how research funding agencies will manage a shutdown.

The White House Office of Management and Budget has collected most current agency contingency plans, and direct links to a few key R&D agency plans are below, courtesy of AAAS:

  • Department of Health and Human Services (NIH, CDC and others) : 73 percent of NIH staff would be furloughed. Some of those that remain would continue providing inpatient and outpatient care for current patients of the NIH Clinical Center, though no new patients would be accepted. NIH staff would also maintain their animal stock, research infrastructure and data. Most FDA monitoring programs and CDC outbreak programs, including its seasonal influenza work, would cease.
  • National Science Foundation : Virtually all staff is to be furloughed, with those remaining responsible for the protection of life and property. NSF will be sending notices to awardees informing them that payments won't be made during the disruption, but that research that doesn't require federal employee intervention may proceed.
  • NASA : As mentioned above, ISS support and operational satellite missions will continue, but prelaunch development activities will mostly halt. As with other agencies, no new contracts or grants will be issued, and apparently citizens will not have "access to the NASA website."
  • USDA Research, Education and Economics : Just about all staff at the National Institute of Food and Agriculture and the Economic Research Service would be furloughed, though the Agricultural Research Service would retain several hundred staff to safeguard research animal populations, IT infrastructure and other assets.

September 20, 2013

The fiscal year ends Sept. 30 — and we’re back to brinksmanship
Oct. 1 government shutdown will result if Congress can’t agree whether to fund Affordable Care Act.

The House of Representatives today passed a bill to fund the government through Dec. 15, 2013 at fiscal year 2013 funding levels. But it's never that simple, is it? This Continuing Resolution also defunds the Affordable Care Act, which has survived 41 previous attempts in the House to repeal it. If the bill is not signed by the president before Oct. 1, the government will have no legal authorization to spend money and will shut down.

So, here's what most savvy observers expect to happen. The House passed the bill with the repeal. In the next few days the Senate will pass the bill with an amendment to strike the repeal. And then — the game of chicken begins in earnest. Before the bill can be sent to the president, the House and Senate must pass the same version. Will the Democrats blink to keep the government from shutting down? The Senate majority says the Senate does not have the votes to pass a provision repealing “Obamacare,” and President Obama says he will not sign a bill that repeals it. Will the House majority finally admit that they don't have the votes to get of the healthcare law, and pass the Continuing Resolution without the repeal? It's not “Breaking Bad,” but this is pretty compelling drama.

Your blogger promised you an update on sequestration — so here's the latest. Despite very heavy advocacy activity supporting a repeal, the path to repeal sequestration is just not there. What is needed is a “Grand Plan” in which federal spending, revenues and entitlements are on the table — the type of effort that led to the original Budget Control Act. Instead we have (continuing) gridlock. That may change with the coming imperative to raise the federal borrowing limit (debt limit) by mid-October. While the president has said he will not negotiate any policy changes on the back of raising the debt limit, an opportunity to negotiate may present itself. Certainly House Republicans would like to use the occasion to negotiate additional spending cuts or other issues.

Wondering what the cuts would be to research funding if sequestration remains in effect during FY 2014? A new report from the Center on Budget and Policy Priorities explains that because non-defense accounts have been cut more than defense accounts, sequestration in FY 2014 should fall mostly on defense: if, that is, Congress doesn't make other changes to the law, and if Congress sticks to the law as it was written. The report says:

“If sequestration remains in effect, non-defense discretionary funding in 2014 will be at about the same level as in 2013, while defense funding will be $20 billion below its 2013 funding level . This would occur largely because Congress made one-time changes to the BCA in the “fiscal cliff” bill that caused defense to be cut $20 billion less in 2013 than the BCA would have originally required under sequestration. In contrast, these changes had little net effect on funding for non-defense programs in 2013, causing it to be cut by roughly the same amount as originally called for.”

The bottom line from CBPP is that these defense reductions in 2014 are needed to restore the parity between defense and non-defense programs that the BCA requires, but which policymakers circumvented in 2013.

The chart prepared by CBPP shows that since FY 2010, non-defense discretionary (NDD) accounts (which include NIH, NSF, other non-defense science agencies) have been cut 15.7 percent, and defense 11.6 percent. If sequestration continues into FY 2014, NDD will have been cut by 17.8 percent since FY 2010, and defense by 17 percent.

Clearly the best outcome for science funding agencies is for sequestration to be repealed outright, but those agencies would no doubt be grateful to get through the upcoming budget cycle without additional cuts.

August 27, 2013

Stuck inside of DC with those fiscal cliff blues again...
Time to catch up on federal fiscal policy progress, or lack of it.

The House and Senate won’t return to Washington until Sept. 9. At that point there will be only three short weeks left until the end of fiscal year 2013, by which point Congress must pass some form of spending legislation — a continuing resolution, or CR for short — to keep the government from shutting down.

The possibility of a government shutdown hasn’t loomed since January 2013. That was the most recent point at which Congress and the president were able to reach an agreement on a "fiscal cliff" deal, and it resulted in a projected $600 billion tax increase over 10 years. The Speaker of the House John Boehner, R-Ohio, said at the time that he would not negotiate further with President Obama on a budget deal, and that the House majority wouldn’t compromise further on taxes. So as much as your blogger resists mentioning the words "shut down," that consequence must be added to the high stakes brew that Congress and the White House will be mixing during the fall.

The word is that the president himself will stay out of direct negotiations, and that the House and Senate leadership will make a short-term deal, a CR covering two or three months of government spending at the current level, to fund government activities through the end of 2013. (This deal would set up the next round of inconveniently timed high-stakes negotiations. If members of Congress aren’t working during the winter holidays, it must not be 21st century Washington.)

The U.S. Treasury has announced a complication: U.S. borrowing authority will expire around Oct. 15 of this year, a bit earlier than anticipated, and very near the moment when Congress has to pass a CR. Before that announcement, the assumption was that the congressional leadership might be able to produce a no-drama CR, saving the drama for the negotiations to extend the debt limit. Now, negotiations to develop a funding bill and to raise the $16.7 trillion debt limit are likely conflated. What sort of drama can we expect? The usual — the House majority would like the Affordable Care Act deleted, defunded and debunked, with a side of additional spending cuts. The president has said raising the debt limit is non-negotiable. Thus, the game of chicken will commence.

Readers may wonder if there is any hope for the larger sort of fiscal deal, in which the House, Senate and administration work together toward shared goals. There is a group of Republican senators meeting with the administration pushing toward that level of resolution, though their efforts are modest so far. A recent New York Times article   detailed the group’s efforts and the challenges it faces. Your blogger appreciates the optimism and doggedness of this group in the face of big obstacles.

The topic of sequestration deserves a full discussion so we’ll save that for the next blog post. Just know for now that there is a great deal of advocacy going on in support of repealing sequestration. APA is cosponsoring a major upcoming report about the consequences of sequestration, and APA staff will participate with coalition partners in a big lobbying sweep in early September.

July 15, 2013

House and Senate Committees are moving appropriations bills
No bills have passed both houses — no vetoes yet.

Moving fiscal year 2014 spending bills from committee to floor is a high priority in the House and Senate between now and the August legislative recess. To date (July 15) four of the thirteen appropriations bills have been approved by the House Appropriations Committee; one of those, the energy and water bill, has begun debate on the floor, and the defense appropriations bill is scheduled for floor debate soon. In the Senate, six of the spending bills have been approved by the Senate Appropriations Committee, including the bill that funds the National Institutes of Health.

On July 11, the Senate Appropriations Committee approved a bill providing $30.955 billion for NIH, an increase of $1.80 billion (6.18 percent) above the FY 2013 funding level under the agency’s sequestration operating plan. That level replaces the cuts from sequestration and also includes a small increase over the FY 2012 NIH budget. Senate Labor-Health and Human Services (LHHS) Appropriations Subcommittee Chairman Tom Harkin, D-Iowa, noted, “This bill includes priorities from both sides of the aisle, on topics ranging from Alzheimer’s disease research and public health to science and math education and teacher quality.” LHHS Subcommittee Ranking Member Jerry Moran, R-Kan., used his opening statement to note that biomedical research was one area of the bill that received bipartisan support. The total NIH funding level includes $40 million to implement the new Brain Research through Application of Innovative Neurotechnologies (BRAIN) Initiative as well as increased funding for Alzheimer’s research. The bill also provides $10 million to the Centers for Disease Control and Prevention to “build the public health research base on how to reduce the threat of firearm-related violence.” The report (PDF, 768KB) accompanying S. 1284 explains the committee’s priorities in more detail.

Sequestration continues, and advocacy to overturn sequestration continues as well. APA is an active member of the Nondefense Discretionary (NDD) Coalition which works to educate policymakers about the adverse impacts of automatic across-the-board cuts on this portion of the budget. The NDD coalition has a new website: give it a look.

While we have your attention: Thanks for hanging in with us while the APA website upgraded its infrastructure, which should mean more room to blog! And in non-budget-related news, the Federal Budget Blog salutes our former Science Government Relations colleague Karen Studwell, JD, who has taken a new position down the hall as APA’s Director of the Education Government Relations Office.

June 7, 2013

Obama threatens appropriations vetoes
Obama hopes enforcing caps will encourage comprehensive budget deal.

Last week the White House issued a Statement of Administration Policy (SAP) saying that the president’s advisors would recommend vetoes of the House Military Construction-VA (H.R. 2216) and Homeland Security (H.R. 2217) appropriations bills unless Congress changes the overall funding allocations for fiscal year 2014 because the House’s spending levels shortchange domestic spending needs. And while the SAP addressed the House’s first two bills, the White House notes that its veto threat will also be applied to “any other legislation that implements the House Republican budget framework.”

The logic here is that the president wants to repeal sequestration, not mess around with it. President Obama has repeatedly urged Congress to revise the Budget Control Act of 2011 (BCA) to overturn sequestration and allow the cap on regular discretionary spending to rise from about $967 billion to $1.058 trillion.

The House appropriations bills are being written to the specs of the House-passed (Ryan) budget, which as you may recall favored defense spending at the expense of non-defense discretionary accounts. As the House Appropriations Committee is now proceeding, defense funding would exceed its BCA spending cap by as much as $45 billion (essentially, as if sequestration never hit defense at all). Non-defense discretionary accounts would fall below their BCA cap by the same amount and, as a result, most areas outside defense would face deep cuts.

Unless Congress rewrites the Budget Control Act, federal operating expenses in FY 2014 will be reduced by about $21 billion from $988 billion in FY 2013, a level that takes into account the sequester that already has triggered furloughs and reduced many services.

Senate Appropriations Chairwoman Barbara Mikulski, D-Md., will use $1.058 trillion as the cap in her chamber’s spending bills, as that was the cap in the Senate-passed budget. Senate versions of the bills will be marked up the week of June 17, beginning with the Military Construction-VA bill.

The president issued similar veto threats last year when the House considered FY 2013 spending bills with a cap below the level set under the 2011 deficit reduction agreement. The House passed seven of the FY 2013 bills on the floor, but the Senate took up none of the measures, so no stand-alone bills reached the White House desk.

Note: The APA website is undergoing some infrastructure improvements, so the Federal Budget Blog will be on hiatus until mid-July. We apologize for the interruption, but we’ll be back as soon as possible!

May 14, 2013

What will federal spending look like for FY 14?
Republican Appropriators sound off.

The House and Senate Appropriations Committees have begun holding hearings as a prelude to drafting the fiscal year 2014 funding bills. The Chair of the House Appropriations Committee, Rep. Harold Rogers, R-Ky., was quoted in early May saying that that his party’s lawmakers will face tough choices given that they are now planning to produce bills with an overall cap of $91 billion less than this year under sequestration.

The recent budget-control laws would cap the federal government’s regular discretionary operating expenses at about $967 billion. The current level of $984 billion has led to furloughs of workers and other cutbacks throughout government programs. At NIH, for example, the agency expects to lose $1.6 billion or 5.5 percent this year under sequestration. NIH expects to fund more than 1,300 fewer grants this year, including 703 fewer new grants.

Chairman Rogers, who opposes the sequester, said that he expects the cuts in spending to be replaced in a broader fiscal deal sometime later this year. Rogers speculated that his committee may have to work on two sets of bills for Fiscal 2014, one group reflecting the $967 billion cap and the other set at a different spending level determined by a future agreement between Democratic and Republican leadership.

The Senate-adopted budget level was higher than that of the House because it assumed sequestration would be canceled. Senate Appropriations Chairwoman Barbara Mikukski, D-Md., is trying to get Republican support to draft bills in her committee and chamber at the pre-sequester level of $1.058 trillion. Senate Republicans, who did not vote for the Senate-passed budget, are still pushing back.

Policy differences between the two parties remain as strong as ever. A conference committee to resolve differences between the House and Senate budgets remains unlikely. A failure to resolve differences in spending in the next few months could mean very different sets of spending bills emerging from the House and Senate, which would each still require negotiation later in the session. So if negotiation doesn’t take place over the budget levels, it will still be required for Congress to adopt spending legislation.

April 26, 2013

Sequestration Brings Airline Delays, Federal Closings, New Warnings
Meditations on pain and gain.

Your blogger and her ilk have been wondering when the pain of sequestration would start to ripple through the wider public. Scientists and academics have been keenly aware of the difficulties spawned by the automatic across-the-board cuts that went into effect on March 1. In fact, as White House public outreach staff tell us, the science community has been the most active of all concerned constituencies when it comes to advocating against the cuts. But when, we wondered, was everyone else going to begin to notice that the cuts have real consequences?

Perhaps in early March when outraged congressmen began to scold the White House for cancelling tours?  Perhaps in mid-March when the House and Senate office buildings closed some entrances to allow for furloughs of Capitol police, resulting in long lines of visitors at the entrance metal detectors?  Nothe answer is this week, because as we head into summer vacation season, delays have begun at many major airports. The Federal Aviation Administration has begun implementing furloughs of all staff, including air traffic controllers, to reach its target of $637 million in savings by Sept. 30. Each of the nation’s 15,000 controllers will take 11 furlough days before the end of the fiscal year, and the days are carefully scheduled to minimize the impact on the traveling public. And yet, the traveling public was hit with noticeable delays on April 22, the first day of furloughs.

You can see flight delays and the reasons for them on the Current FAA Airport Delays page at the Flightstats website. Flyer beware!

The Internal Revenue Service is also commencing furloughs, but has chosen to close IRS offices completely on furlough days to realize additional savings from building operations, etc. IRS Acting Commissioner Steve Miller said in a note to staff on April 19: “The first furlough days will be May 24, June 14, July 5, July 22 and Aug. 30, with another two days possible in August or September. All public-facing operations will be closed on these dates, including our toll-free operations and taxpayer assistance centers.”

Adding to the drumbeat of serious news about sequestration, Secretary of the Army John McHugh and Army Chief of Staff Gen. Ray Odierno testified (PDF, 228KB) before the Senate Armed Services Committee on April 23, expressing concern about the cuts the Defense Department is experiencing. The department is required to cut nearly $42 billion by the end of September. If no action is taken to reverse sequestration, the cuts will continue into future years. The Army's share of the automatic cuts over the next six months is $7.6 billion. According to Secretary McHugh, the Army may have to reduce its force by over 100,000 beyond currently planned reductions if sequestration continues into fiscal year 2014 and beyond.

Recall that the budget adopted by the House would cancel sequestration for defense, but not for non-defense accounts. The budget adopted by the Senate and the one proposed by President Obama would cancel sequestration for both defense and non-defense accounts. Only a law passed by both houses and signed by the president could end sequestration, and that hypothetical law would have to include provisions for revenue that would replace the savings yielded by the automatic cuts. So far the odds of such a law passing both houses of Congress have not improved, but as the consequences of the cuts become more onerous, the odds may change.

April 17, 2013

President Obama Releases 2014 Budget
The budget is equal parts “vision” and “negotiating position.”

President Obama released his 2014 budget on April 10. Maintaining the nation’s investments in research and development and Science, Technology, Engineering and Math (STEM) education was a primary theme. The budget request for research and development totaled $142.8 billion, a 1.3 percent increase over fiscal 2012 enacted levels but a small decline when inflation is taken into account. Non-defense research spending would rise to $69.6 billion, a nine percent increase from 2012 levels. That increase would be offset by a significant reduction to the development side of R&D, which would get $71.5 billion, focused mainly on weapons programs at the Pentagon.

White House Office of Science and Technology policy director John P. Holdren told representatives of scientific organizations at an OSTP budget briefing that the request demonstrates the administration’s commitment to scientific research, particularly considering that the overall budget reduces discretionary spending to its lowest share of the economy since President Eisenhower’s administration.

Funding for the National Institutes of Health (NIH), the National Science Foundation (NSF) and the Veterans Administration (VA) Medical and Prosthetic Research Program would increase above the FY 2012 enacted levels.

The NIH program level for FY 2014 is $31.331 billion, an increase of $471 million (1.5 percent) over the FY 2012 program level of $30.860 billion. NIH estimates that it will spend $16.9 billion to support 36,610 research project grants (RPGs) in FY 2014, an increase of $382 million and 351 grants over than FY 2012. Within this total, NIH estimates it will support 10,269 new and competing renewal RPGs, an increase of 1,283 grants over FY 2012. Programs emphasized within the NIH budget include: the BRAIN Initiative; opportunities and challenges associated with big data; translational science; and recruiting and retaining diverse scientific talent and creativity.

The administration’s budget requests an appropriation of $7.6 billion for NSF. This is $593 million or 8.4 percent above the FY 2012 enacted level and maintains the administration’s commitment to increase funding for basic research agencies. NSF will invest in a broad portfolio of fundamental inquiry, as well as strategic investments in areas such as cyber infrastructure, clean energy and training. The NSF budget includes focused investments on scientific and engineering training, as well as the cultivation of a globally-competitive high-tech workforce. Other proposals include the consolidation of science, technology and mathematics education programs across the federal government; the expansion of research opportunities for early college students through an increase of $13 million above the 2012 enacted level, to $79 million; and the consolidation of an array of NSF’s graduate education programs into a single $325 million fellowship entity.

The president’s budget reduces funding for the Centers for Disease Control and Prevention (CDC) by over $270 million from the FY 2012 enacted level, for a total program level of $6.895 billion. The president’s request slashes the agency’s actual budget authority by $439, and continues the trend of relying on backfilling from the Prevention and Public Health Fund and other fund transfers. The agency’s Prevention Research Centers program sees a decrease in funding, while the National Center for Health Statistics sees a significant increase.

The VA Medical and Prosthetic Research program would receive $586 million, an increase of $5 million (0.8 percent) above the FY 2012 level. A summary (98KB, PDF) of the proposed VA budget notes that investing in medical and prosthetic research supports efforts to advance the care and quality of life for veterans. The National Aeronautics and Space Administration (NASA) request proposes $17.7 billion, down a scant 0.3 percent from fiscal 2012’s enacted levels.

Overall the budget would increase spending in 2014 by nearly $160 billion beyond what the Congressional Budget Office projected in February — a result of canceling sequestration and of new spending initiatives. Many of the president’s proposed savings would phase in toward the end of the 10-year budget window, such as the plan to recalculate cost of living increases to reduce entitlement spending. The deficit would drop to $744 billion, or 4.4 percent of GDP — the lowest of the past five years — and continue dropping to 2.8 percent of GDP in 2016 and 1.7 percent in 2023 assuming the economy continues to improve. The accumulated U.S. debt, meanwhile, would rise $8.1 trillion to $25.3 trillion over the decade.

The president positioned his budget to the political right of the budget the Senate approved last month, especially with the inclusion of entitlement reforms, with the expectation that it could serve as a blueprint for a new round of negotiations with the more conservative House leadership on long-term economic policies. However, the Obama budget did not receive a positive reception. The president’s proposed $580 billion in tax increases (including a tobacco tax increase that would pay for a new preschool program for four-year-olds) remains a sticking point.

April 16, 2013

FY 2013 is Final, Now on to FY 2014
Science agency budgets caught in debates about federal spending.

A summary of how research funding fared in the FY 2013 budget and what to look for as congress moves to the FY 2014 budget is provided in the latest issue of Psychological Science Agenda .

March 27, 2013

Congress Approves Fiscal Year 2013 Funding — How is Science Funding Affected?
Sequestration was not repealed.

The good news is that Congress has finally approved H.R. 933 , FY 2013 Appropriations, after a series of temporary resolutions. This means that science funding agencies can finally make decisions about how to manage their programs between now and Sept. 30, 2013.

In the category of "not good news": the bill sets up nearly $10 billion in cuts to research and development. The bill reduces research and development funding by $506.6 million from FY 2012 levels, according to estimates by the American Association for the Advancement of Science (AAAS) (PDF, 35KB), but because it also leaves sequestration in place, federal R&D may be reduced by $9.6 billion in all below last year’s levels, a 6.9 percent decline.

According to a useful summary by AAAS, Department of Defense (DOD) R&D will be reduced by around $7.0 billion (9.4 percent below FY 2012), with Congress cutting $1.3 billion and sequestration accounting for the rest — though the percentage cut from the Defense Health Program research will be somewhat smaller than that of the DOD overall cuts due to a congressional boost.

Cuts to nondefense research agencies were not uniform. National Science Foundation R&D received an increase of $152 million or 2.7 percent, which would leave the agency's R&D budget only 2.4 percent below FY 2012 levels after sequestration. The political science research program at the National Science Foundation was preserved but with evident restrictions: see Coburn amendment restricts NSF political science funding. And despite a small boost to NIH, sequestration will still leave the agency’s R&D funding roughly $1.4 billion or 4.8 percent below FY 2012 levels.

When adjusted for inflation, these figures put federal R&D investment at its lowest level since FY 2002, and more than $25 billion in constant dollars below the all-time peak in 2010. This represents a roughly 17.1 percent decline in just three years. AAAS’s R&D Budget website has additional details.

The House and Senate passed their respective budgets last week: our next blog post will include an examination of the two chambers’ differing visions for fiscal health and governance.

March 20, 2013

Wrapping up Fiscal Year 2013 and Budgeting for 2014 in the Same Week
Will either of these bills fix sequestration? Don't hold your breath.

The House and Senate must agree on legislation to fund the final six months of fiscal year 2013 before the current spending legislation expires on March 27. Because the House is scheduled to recess for Easter beginning March 21, the pressure is on for the Senate to complete its bill and send it back to the House. Problem is, senators like to offer amendments, and voting on or tabling all the amendments has been a challenge. The Senate is amending H.R. 933 , the House-passed bill. 

Like the House bill, the Senate amendments preserve existing spending caps, which set non-emergency discretionary spending authority for 2013 at about $984 billion after the spending sequester is taken into account, down from $1.043 trillion in fiscal 2012. So far, senators have rebuffed efforts by members of both parties to make substantial changes to the bill in order to speed its completion. Last week, the Senate rejected an amendment by Sen. Tom Harkin, D-Iowa, that would have boosted funding for education and medical research, but also rejected an amendment to bar funding for the Affordable Care Act. At press time the Senate had amended the bill to include $164 million more for programs in the Departments of Labor, Health and Human Services and Education, $83 million more for Defense, and less for programs in Commerce, Science, Transportation (-$224 million) and Interior (-$779 million). It appears that the sequestration will not be repealed in this legislation, although agencies may be allowed more flexibility to distribute the automatic cuts in less harmful ways.

It's worth remembering as the House begins consideration today of H. Con. Res. 25, the Republican fiscal year 2014 Budget Resolution, that budgets are guidelines and aspirational documents. We pay attention to them for the "big picture," since they don't carry the force of law, and any assumptions about changes to law must be enacted separately. Authored by House Budget Committee Chair Paul Ryan, R-Wis., H. Con. Res. 25 would cut non-defense discretionary spendingby more than $1 trillion over 10 years below the level of the 2011 Budget Control Act caps, which already reduced spending to its lowest level as a share of the Gross Domestic Product since 1962. The resolution would end the Medicare guarantee for future retirees and replace it with a voucher program. It would also save $810 billion by turning Medicaid into a capped block grant. This budget also relies on a repeal of the Affordable Care Act, despite the fact that the ACA was upheld by the Supreme Court and withstood over 30 votes on repeal last Congress. One reason this budget is so draconian is that it was very important to the Republican Caucus that Chairman Ryan offer a budget that balances in ten years.

Several different budget bills will be considered in the House, including a Democratic version that would slowly scale down some spending while maintaining a projected deficit of $610 billion by the end of 10 years. House conservatives also released an alternative budget resolution on March 18 that calls for a balanced budget in four years. The Ryan budget is expected to pass.

The Senate Budget Committee's budget resolution authored by Chair Patty Murray, D-Wash., employs a combination of new revenue and spending cuts to reduce the deficit by $1.8 trillion according to the Congressional Budget Office. S. Con. Res. 8 would direct the Finance Committee to increase revenue by $975 billion over 10 years. It would replace the fiscal year 2013 sequester with a combination of new revenue and spending cuts. It calls for cutting $23 billion from agriculture programs, and includes some economic stimulus in the form of infrastructure improvements and worker training.

It seems unlikely, given the gulf between House and Senate economic aspirations as expressed in the committee budgets, that the two bodies will be able to conference their budgets and come up with a guideline both chambers will abide by. Still, they must agree to overall spending limits in order to approve fiscal year 2014 appropriations bills later in the year. We'll get back to this conundrum after they've dispatched the fiscal year 2013 funding legislation. Stay tuned!

March 4, 2013

No, you didn't imagine it
Some policy makers believe the impact of sequestration is overblown.

They say that where you stand depends on where you sit. And if you are sitting in a lab supported by federal funds, working with students who are supported by federal funds, eating food that's been inspected with federal funds and riding home on a transit system that's maintained with federal funds, you may well be concerned about the impact of sequestration on your life and work. If you don't do any of those things, or believe the cuts are too small to have any catastrophic effect, you may be unconcerned. It is true of course that the real impact of the cuts will roll out over time, so on this first Monday of sequestration, things for most people are much the same as last Thursday. Some policy makers have accused President Obama and many Democrats of rampant "Chicken Little-ism."

Still, another date of doom is on the horizon, and having done as much as possible to raise the alarm about the impact of March 1, the president and congressional leaders are laying the groundwork for a deal to fund the government through Sept. 30. The good news, if there is any, is that the congressional appropriators have more of a central role in this part of March Madness. The appropriators for the most part understand government programs and compromise, and are eager to reclaim their primacy through the recommencement of "regular order." That means passing all the bills on time. The stakes for the Continuing Resolution negotiations that will now take over congressional energies for the next three weeks are high. No deal means the government shuts down. We at the blog are reasonably sure nobody wants this, although we believed that about sequestration, too, for a while.

You may be wondering if there is anything you can still do to call attention to the impact of sequestration, now that the latest deadline is knocking it off the front pages. We suggest:

  • Kicking it up a notch. Instead of writing another letter, go visit your members of Congress at town hall meetings or appearances in the home district, and make your case in person.
  • If your lab can offer good "visuals," invite your representative and her/his staff over to see your work and hear more about it.
  • Get together with others who are feeling the impact, in other scientific departments and plan joint action.
  • Write a letter to the editor or Op-ed for your local paper.

APA can help with good advice about these and other ideas. Contact Pat Kobor if you have questions.

February 22, 2013

Sequestration Round-up: Stories About Adverse Impacts Are Everywhere
NIH and its defenders speak out.

To summarize all the summaries you may have been reading: it looks as though the across-the-board cuts known as sequestration will likely go into effect on March 1. Senate Democrats will probably bring multiple bills to the floor next week that would cancel the cuts, but none of the bills appears palatable to the House leadership. Both houses of Congress would need to pass legislation in order to cancel or delay sequestration. But whether sequestration will remain in effect for a month, or for the rest of the year, is not known. That may depend on the public outcry — or lack of it — when the cuts hit.

This week stories about sequestration were all over all the news media. Amid stories about the negative impact of across-the-board cuts on air travel, civilian employees of the Department of Defense and the National Zoo (“sealquestration?”) were two important stories about the impact of cuts on federal science agencies.

U.S. Senator Barbara Mikulski, D-Md., chair of the Senate Appropriations Committee, visited the National Institutes of Health on Feb. 20 to hear from Director Francis Collins how he anticipates that NIH will cope if sequestration goes into effect on March 1. Accounts of their news conference make clear that Sen. Mikulski expects the Senate to consider legislative alternatives next week, and hopes to persuade Senate Republicans to support them. Appropriations Committee bills will be negotiated before March 27 when the fiscal year 2013 Continuing Resolution, which now funds the government, will expire. Most observers expect that legislation to include a fix for sequestration, but how to develop a fix that will appeal to all sides poses real challenges.   

Elias Zerhouni, who served as NIH director under President George W. Bush, spoke to the Washington Post about the adverse consequences of sequestration. He said, "I don't want to sound dramatic, but it's not theoretical. People have crocodile tears for all the various types of cuts, but this kind of cut is damaging. It's not something that you can manage year to year. It's an investment. They cannot go up and down with the political winds.”

Most federal agencies have provided some information about how sequestration would affect their programs and missions. Many agencies sent letters to the Senate Appropriations Committee in response to a request for information on impacts. The U.S. Office of Management and Budget expects to provide more detailed information about impacts in the coming days. 

February 19, 2013

Brace for Impact
Most observers think sequestration will go into effect, temporarily.

APA and other organizations that are urging Congress to avoid disruptive automatic budget cuts were invited to the White House today to hear a short speech on the consequences of sequestration . Standing in front of firefighters and other first responders whose jobs might be in jeopardy if $85 billion in pending cuts go into effect, President Obama made a plea for Congress to work with him to adopt legislation that will delay the cuts set to go into effect on March 1. He suggested that at a minimum, Congress should pass a smaller bill that would allow time for more comprehensive legislation, such as tax or entitlement reform, to be negotiated. 

Senate Democrats plan to bring a deficit reduction bill to the floor the week of February 25 that would include cuts to agricultural subsidies and would tax oil derived from tar sands, as oil from other sources is taxed. The $110 billion bill would also raise taxes on millionaires, and would meet the Budget Control Act’s deficit reduction targets through December. Senate Minority Leader Mitch McConnell, R-Ky., has said the Senate Republicans oppose the inclusion of new revenue in any bill to suspend sequestration. House Speaker John Boehner, R-Ohio, has said if the Senate passes a bill, the House will work with Senate leadership, but cautioned that the House will not consider a bill that does not bring the U.S. budget to balance within ten years.

While it's true that Congress is often able to pull a rabbit out of a hat at the last minute, most observers doubt that any sequestration-lifting legislation can pass the Senate (where 60 votes will be needed to prevent a filibuster) before March 1. A more comprehensive budget agreement might be possible by the end of March, when House and Senate appropriators must extend the fiscal year 2013 Continuing Resolution that currently funds most federal programs.  

If sequestration does go into effect on March 1, it is not known how quickly cuts would then occur. Some programmatic cuts may be immediate, but cuts involving personnel would take longer. Federal agencies are required to give employees 30 days' notice before furloughs occur.

If you have not yet communicated with your U.S. Senators and Representative about this issue, allow us to suggest a quick and easy way: send an email through APA's action alert.

February 11, 2013

Administration Gets Specific About Pending Cuts
Cuts to be deeper than previously reported.

The White House Office of Management and Budget issued a news release on Feb. 8 with specific information about how the pending across-the-board cuts of sequestration would affect federal agencies. Advocates had been wondering how the level of the pending cuts had altered since passage in January of the American Taxpayer Relief Act (PDF, 245KB).

According to the release, “The Office of Management and Budget now calculates that sequestration will require an annual reduction of roughly 5 percent for nondefense programs and roughly 8 percent for defense programs. However, given that these cuts must be achieved over only seven months instead of 12, the effective percentage reductions will be approximately 9 percent for nondefense programs and 13 percent for defense programs.”

The White House news release also provided examples of the impact of the cuts:

  • “Cuts to the Mental Health Block Grant program would result in over 373,000 seriously mentally ill adults and seriously emotionally disturbed children not receiving needed mental health services. This cut would likely lead to increased hospitalizations, involvement in the criminal justice system, and homelessness for these individuals.”
  • “Our ability to teach our kids the skills they’ll need for the jobs of the future would be put at risk. 70,000 young children would be kicked off Head Start, 10,000 teacher jobs would be put at risk, and funding for up to 7,200 special education teachers, aides, and staff could be cut.”
  • “Cuts to the AIDS Drug Assistance Program could result in 7,400 fewer patients having access to life saving HIV medications.”
  • “The National Institutes of Health (NIH) would be forced to delay or halt vital scientific projects and make hundreds fewer research awards. Since each research award supports up to seven research positions, several thousand personnel could lose their jobs.”
  • “The National Science Foundation (NSF) would issue nearly 1,000 fewer research grants and awards, impacting an estimated 12,000 scientists and students and curtailing critical scientific research.”

The mood in Washington is pessimistic that sequestration can be avoided this time, but some parties are busy crafting alternatives. Senate Democrats are planning to introduce a bill this week that will offer cuts and revenues and delay the sequester for a few months. Several committees, including Senate Appropriations and Armed Services, are planning hearings.  If the Senate takes up a bill the week of Feb. 25 there will be enough time to pass it before the sequester takes effect on March 1. However, there is no indication that the House would consider the bill.

APA is asking the psychological science community to write your members of Congress to remind them that the discretionary accounts have already absorbed $1.4 trillion in cuts and to urge them to support a balanced approach to deficit reduction that does not rely solely on spending cuts. Take action online and, if you haven't yet, be sure to sign up for APA’s Public Policy Advocacy Network.

January 28, 2013

Ominous Rumblings — Sequestration May Become the Battleground on Spending Cuts
Federal agencies brace for impact.

Rep. Paul Ryan, R-Wisc., of the Romney-Ryan presidential ticket and chair of the House Budget Committee, has been strategizing with his party about how Republicans can achieve significant spending cuts in this session of Congress. His eyes have alighted on sequestration, the automatic spending cuts set to strike on March 1 unless Congress acts to avoid them. Given that the recent debt ceiling bill (H.R. 325) did not include spending cuts, and given that other measures that might reduce spending (e.g., entitlement reform) require lengthy and difficult negotiations, sequestration looks to be a logical vehicle on which the House leadership might choose to take a stand.

APA is active in coalitions such as the Coalition for Health Funding and NDD United (remember, that’s ‘non-defense discretionary’) that are advocating against sequestration and in favor of a balanced approach to deficit reduction. Watch for alerts to APA’s Public Policy Advocacy Network suggesting ways you can continue to make your voice heard about these pending cuts.

A Washington Post article yesterday on how federal agencies are preparing for the possibility of sequestration quotes psychologist Steve Higgins of the University of Vermont about the consequences he and his research labs have already experienced. 

The Department of Defense has asked Congress for permission to begin furloughing civilian employees one day a week if the cuts are not avoided. This action would amount to a 20 percent pay cut for civilian employees for the remaining five months of fiscal year 2013. 

U.S. Senator Patty Murray, D-Wash., chair of the Senate Budget Committee, announced today the launch of an online platform through which members of the public can engage with the committee.

Murray writes, “'My Budget' goes live today to help you share your stories, ideas, and priorities. It will give working families, students, and seniors one more way to let us know what a fair budget means to them. And in the weeks and months ahead, we will be adding additional tools and resources to enable people across the country to have their voices heard loud and clear as we tackle our budget and economic challenges and to help them engage their friends, organize, and advocate for their budget values and priorities.”

January 23, 2013

House Leadership Offers Short-Term Debt Limit Deal
Everyone look away: Nobody can see the debt limit until May 19. 

On the negative side, this is another short-term fix that will expire in four months, adding another "date of doom" to the calendar. But on the plus side —wow— who expected the House leadership to offer to "suspend" the debt limit? Yes, the debt limit is a creature of Congress, and Congress may, if it chooses, sort of pretend it doesn’t exist. That’s what they’re doing. 

The House proposal would suspend the debt ceiling until May 19, which will allow the U.S. to continue to borrow to meet financial obligations without requiring Congress to vote on raising the debt ceiling. But to be clear, the bill does actually increase the debt limit by an amount to be determined later. The increase can then be tied to a specific date, presumably the date they reach agreement, without Congress having to vote to make it so. Transparent? No. But less excruciating? Definitely. All your blogger can say is, wow.

Legislation to effect the House leadership proposal, H.R. 325, will be brought to the House today (Wednesday, January 23, 2013).

There is one additional condition, however. The (majority Republican) House of Representatives has complained that the (majority Democratic) Senate has not produced its own budget in four years (although Senate Democrats are quick to point out that the Senate did pass the Budget Control Act, which sets overall spending ceilings, which is the primary function of a budget). If the House and Senate fail to produce separate budgets by April 15, members’ salaries would be escrowed until the budgets appear. 

Speaking of dates of doom, H.R. 325 will neither affect the process nor alter the effective date of the sequester: March 1. The current continuing resolution which funds the government lasts through March 27. And we all know that the Ides of March will fall between those two dates. 

January 14, 2013

More on the American Taxpayer Relief Act, and What Happens Next
Checking under the sofa for a spare $1 trillion.

By now, readers who are employed may have received an altered paycheck, and wondered again just how the American Taxpayer Relief Act (ATRA), which was signed by the president early in 2013, changed several tax laws. For example, the payroll tax "holiday" expired, so your check probably reflects increased Social Security withholding.

The White House released information on ATRA that explains its provisions, along with the administration's take on the legislation.

ATRA raises approximately $620 billion in new revenues and will save more than $100 billion in federal interest payments, according to the Office of Management and Budget. Instead of tackling sequestration directly, ATRA delays sequestration until March 1, 2013, allowing more time for Congress and the administration to negotiate a solution.

Because of the revenues raised, ATRA also reduces the total amount subject to the sequester over the next nine years by $24 billion. So the annual cuts would be smaller, around $107 billion per year instead of $109 billion per year before ATRA. The organization Federal Funds Information for States (FFIS) has released an estimate of the new sequester cuts following enactment of ATRA. Should the sequester take effect in March, FFIS predicts that the cut to non-defense discretionary accounts will be 5.9 percent across the board.

Last year’s uncertain budget picture has become this year’s uncertain budget picture. Federal agencies must continue to plan for the possibility of large 2013 budget cuts, which, if they should happen, would be proportionally more onerous since they would necessarily be distributed over fewer months of the fiscal year.

Keep in mind, to make the threat of spending cuts go away, it will take revenue —approximately $1 trillion to cancel sequestration. And remember it’s very unlikely Congress would go along with a proposal to completely avoid any new spending cuts. The "Boehner Rule" for deficit reduction pushed by the House leadership is $1 in cuts for every $1 in revenue. But wait, there’s more: to stabilize the debt, according to the Center for Budget and Policy Priorities, around $1.4 trillion is needed —the House leadership is very adamant on this principle, though it might quibble with the amount needed. And to raise the debt ceiling for a year (did we mention, Speaker Boehner’s position is, again, $1 of spending cuts for each $1 increase in the debt ceiling) an additional $1 trillion is needed.

That’s right, another wild card is the federal debt ceiling, which must be raised soon —some say, mid-February, others say mid-March— to avoid default on U.S. financial obligations. Although the administration has declined to pursue creative ways of raising the debt ceiling without Congress’s approval (nope, no trillion-dollar coin!) the president has said he will not negotiate with Congress to pay debts the nation has already incurred. The congressional leadership has a different view.

The White House will present its fiscal year 2014 budget a few weeks late, likely in late February. In the meantime, the government is funded via continuing resolution at 2012 levels through the end of March. Congressional appropriations committees are working on completing the 2013 funding bills in the absence of information about whether sequestration cuts will be applied to the bills before the year ends.

It’s all pretty gloomy, and gloomily familiar. But most observers agree that the real dysfunction isn’t that the philosophical and policy differences between parties are so large. The breaking point has been a lack of willingness to compromise and work across party lines. That’s the real significance of the passage of ATRA: the administration and Congress were able to reach agreement (in the classic way that satisfied nobody) and avoided some genuinely bad consequences. So your blogger is thinking of it this way: the financial-policy machinery may be broken, but the players still know their way around duct tape. Sometimes duct tape is all you need.

January 1, 2013

Congress Passes Legislation to Thwart Fiscal Cliff
Bill postpones across-the-board spending cuts.

Happy New Year, blog readers! The legislation passed by Congress, which the president is expected to sign this week, deals primarily with expiring tax laws that would have raised taxes on Americans at all income levels. The new legislation raises income tax rates on families making more than $450,000 a year (and individuals making more than $400,000), and extends tax benefits for middle-income families. Those benefits include the American Opportunity Tax Credit, which allows students and their parents to claim up to $2,500 a year for college expenses. Research and development tax breaks, such as the one for investment in wind energy, also were extended.

The new legislation does not eliminate the sequester, but postpones its effects for two months, giving Congress extra time to negotiate a solution. The new bill also does not raise the debt ceiling. The U.S. hit its borrowing limit on New Year’s Eve, and the Treasury Dept. is taking administrative measures to delay the need to raise the debt ceiling in order to avoid default, for what also is projected to be around two months.

More details will be available within the next few days.