|Sponsor||Rep. Obey, David R.|
|Date||July 1, 2010 (111th Congress, 2nd Session)|
|Staff Contact||Andy Koenig|
House is expected to begin consideration of the House Amendments to H.R. 4899, the Supplemental Appropriations Act of 2010, on Thursday, July 1, 2010, under a structured rule. The rule is expected to make in order five amendments which will be distributed when the rule becomes available. The rule may also split consideration of the bill into two separate votes. According to reports, one vote would be taken for the troop funding portion of the legislation and another taken for unrelated spending.
Budget enforcement resolution
The supplemental may be coupled with H.Res. 1493, a resolution for budget enforcement for fiscal year 2011. The budget resolution authorizes $1.121 trillion in discretionary spending for FY 2011. The resolution is an increase of more than $31 billion more than FY 2010’s spending despite the president’s pledge to freeze non-defense dictionary spending for three years. In another scenario, Democrats may structure the rule for consideration of the supplemental to “deem” the House Democrat’s FY 2011 budget resolution as passed with the rule. By using this tactic, House Democrats avoid introducing or debating a comprehensive budget for the U.S. While the House has deemed budgets in the past, it has never occurred without the House first considering and passing its own budget resolution beforehand. According to press reports, the reason Democrats refuse to address the fiscal crisis facing our country is because “there’s little appetite for taking on these issues in an election year.”
In either event, this does not represent a true budget. This resolution does not set spending priorities for the federal government, and it does not project federal spending, revenues and deficits over five the next five years. This represents the first time since the passage of the Budget Act of 1974 that the House has never failed to pass an initial budget to set the spending priorities for the following fiscal year.
H.R. 4899 provides approximately $75 billion in mandatory and discretionary spending for the wars in Iraq and Afghanistan, bailouts for state education accounts, disability compensation for Vietnam Veterans related to exposure to Agent Orange, the international assistance, Pell Grants, border security, and a myriad of other agencies and programs. In total, funding for Department of Defense war operations is $33 billion and nearly $4 billion is provided for international activities related to the ongoing conflicts in Iraq and Afghanistan. Thus, a total of $37.4 billion of the funding in the legislation is regarded by the Democrats as funding for the ongoing wars. The bill also includes $11.7 billion in rescissions from existing programs, including $3.5 billion in Department of Defense rescissions and nearly $2 billion in rescissions from unspent “stimulus” accounts. In addition, the legislation includes a number of unrelated policy provisions which are outlined below.
Note: The following summary is based on the House amendment to the Senate bill offered by Rep. Obey.
Troop Funding: The legislation includes $33 billion for the Department of Defense to conduct military operations in Iraq and Afghanistan. The bill includes funding for the operation and maintenance of the Army, Navy and Air Force and provides for the addition of 30,000 new personnel to be deployed to Afghanistan. On March 25, 2010, Secretary of Defense Robert M. Gates reiterated his request for $33 billion in Fiscal Year 2010 supplemental appropriations to support 30,000 additional troops deployed to Afghanistan per the offensive strategy set forth by President Obama.
State Education Bailout: The legislation includes $10 billion for an “Education Jobs Fund” to supplement states’ education costs. The bill stipulates that the funds shall be distributed by the Department of Education through their respective funding formulas or based on each district’s share of Title I funds. States may only use the funds to pay the salaries of employees and the bill prohibits the spending from being used to add to “rainy-day funds” or to reduce state debt. In addition, the bill prohibits states from reducing education expenditures below FY 2009 levels in order to receive the aid (2006 levels apply to states with “especially dire fiscal conditions”).
The fund is similar to the State Fiscal Stabilization Fund, which was created in the first stimulus and has already distributed $53.5 billion to states to supplement education budgets. The president claimed that this spending would create millions of jobs. Instead, the funding was used to subsidize pay for existing obligations, delaying tough budget decisions that would otherwise be essential. In a number of areas, cash-strapped state and local governments used the money to give employees raises. Meanwhile, these governments were shielded from budgeting within their means to meet funding gaps. In addition, states are barred from making reforms that would lower education spending and ease budget pressures. These federal bailouts not only allow state governments to skirt fiscal responsibility with fungible federal money, but they forbid them from cutting spending.
Pell Grants: The legislation includes $4.9 billion to bail out the shortfall in the Pell Grant Program.
International Assistance Programs: The legislation includes $3.3 billion in “International Assistance Programs,” including $2.5 billion for economic and security support of Iraq and Afghanistan. House Democrats categorize this spending as war funding because it supports the militaries of Iraq and Afghanistan. Including spending on international assistance programs, the total war funding in the bill is considered to be $37 billion.
Agent Orange: The bill includes $13.3 billion in new, mandatory spending to provide benefit payments to veterans of the Vietnam War who were exposed to Agent Orange. According to the Appropriations Committee Democrats, “An estimated 86,069 people will be eligible to receive retroactive payments and 67,259 people will be eligible to receive new benefits.”
Haiti: The legislation contains $2.93 billion provided in the Senate bill for relief in Haiti.
Energy Loans: The bill would guarantee $18 billion in Innovative Technology Loans through the Department of Energy. According to CBO, this provision will total $180 million.
Oil Spill: The bill provides a total of $304 million for the Gulf Coast oil spill. The bill contains $130 million for an unemployment benefits program, $83 million for unemployment assistance, $31 million for EPA inspections and studies, $12 million to investigate the spill, and $5 million for recovery planning.
Border Security: The bill provides a total of $701 million for border security. Spending in the bill includes $208 million for border patrol agents, $201 million for Department of Justice programs, $136 million for Customs and Border Protection (CBP) officer staffing and pay raises, $50 million to deploy National Guard troops and $30 million for drug and smuggling interdiction. While these funds are presumably meant to increase the number of agents at the southern border, the House Appropriations Committee Republican staff notes that, “In an admission that it is unlikely these border patrol agents will actually be hired quickly, the bill gives until September 30, 2012 to spend this money on hiring. Funding to permanently increase the size of the Border Patrol can and should have been included in the FY11 Homeland Security bill that was marked up last week.”
Medicare Waste Spending: The bill spends $538 million in an effort to deter waste, fraud and abuse in Medicare.
FEMA: The legislation provides $5.1 billion to pay for the lingering costs of past disasters, such as Hurricanes Katrina, Rita, Ike, and Gustav, and the Midwest floods of 2008.
Emergency Food Assistance: The bill provides $50 million for the Emergency Food Assistance Program for food purchases to distribute through local emergency food providers. This program received $150 million in the Democrats’ stimulus bill. In addition, this bill rescinds $487 milling from the Women and Infant Children (WIC) food assistance program.
Corps of Engineers: The legislation provides $178 million for the Army Corps of Engineers to fund natural disaster response.
Rural Loans: The legislation provides $31.5 million to support $950 million in farm loans.
Fort Hood: The bill provides $16.5 million to replace the Soldier Readiness Processing Center at Fort Hood, Texas.
DoD Schools: The bill includes $163 million for improvements to schools on DoD installations.
Port of Guam Improvements: The legislation provides $50 million for improvements to port facilities in Guam.
Mine Safety: The legislation provides $22 million for mine safety enforcement.
CDBG Disaster Assistance: The legislation provides $100 million to increase Community Development Block Grants in areas that have experienced flooding.
Forests: The legislation provides $18 million for “emergency forest restoration.”
Fisheries: The legislation provides $26 million for fisheries that have been affected by natural disasters.
Drought Relief: The legislation provides $10 million for emergency drought relief.
Highway Safety Studies: The legislation provides $15 million for a highway safety study.
Financial Crisis Report: The legislation provides $2 million to “investigate the causes of the recent financial crisis.”
Economic Development Administration: The legislation provides $49 million in funding for the Economic Development Administration (EDA).
Police Radios: The bill includes $13 million in funding for a new Capitol Police radio system.
Unrelated Policy Provisions
Collective Bargaining Rights: The bill contains 18 pages of the Public Safety Employer-Employee Cooperation Act, a contentious piece of legislation which requires state and local governments to collectively bargain with all law enforcement officers, firefighters, and emergency personnel. This language is strongly opposed by the National Sheriff’s Association and many state and local governments.
Relocation of FBI Headquarters: The legislation includes language directing GSA to give Congress a report within 90 days on a plan to relocate the FBI Headquarters building to somewhere in the Washington Metro region. Neither GSA nor FBI has ever requested funding, or authority to consider, approve, or move the FBI’s HQ—a project that would cost billions. This also has not been considered through the normal agency and congressional process for GSA building projects.
Disqualification of a specific road from a certain Highway Program: The legislation includes language changing current law to remove 10 miles of road in Pennsylvania from the Appalachian Development Highway System (ADHS). This change was made without notification or consultation of the impacted Member or his district. Under current law, the number of total miles in the ADHS is capped. By making this change, another community in another Member’s district becomes eligible for inclusion in the Appalachian Development Highway System.
Amendment to Outer Continental Shelf Act: The bill includes language to require 90 days, or such time as the Secretary of Interior determines necessary, to conduct environmental reviews for offshore drilling permits.
New Unemployment Compensation Programs for Oil Spill: The bill includes 22 pages of authorizing language creating a new unemployment compensation program for individuals impacted by the Gulf oil spill. This extensive language, which has never been considered by the authorizing committees of jurisdiction, would provide “such sums as may be necessary” to fund a new mandatory program notwithstanding the fact that the responsible party has already set up a $20 billion escrow fund to settle claims, such as loss of income, brought by those affected by the spill.
Generic Drugs: The bill contains authorizing language related to marketing of generic drugs. This provision has been criticized as an accounting gimmick that does not offset any new domestic discretionary spending added this year, but instead relies on estimates that savings will occur in future years.
Computation of Medicaid Average Manufacturer Price: the bill contains language to make a change that the Administration had already intended to, and has the authority to make without legislation. This provision is an accounting gimmick that doesn’t create any new savings, but instead is being included to claim “savings” in future years that was already going to occur.
In order to offset a fraction of the cost of the non-defense spending and the bill into alignment with the president’s request, Democrats inserted $11.7 billion in rescissions and mandatory funding reductions. However, according to the Republican staff of the Appropriations Committee:
The Obey amendment would cut defense spending by over $3 billion. By comparison, only $2 billion is cut from unobligated stimulus funds. And, rather than making the hard choices now by identifying real cuts in a $1.1 trillion budget, almost $5 billion – or a third of their savings – are estimated to come in later years from changes in mandatory programs. These future savings are unlikely to occur if Democrats are in charge; instead this deficit spending will go on the taxpayers tab.
A list of the specific rescissions in the bill follows.
According to a CBO, H.R. 4899 (including offsets) contains $47 billion in discretionary spending and $13.3 billion in mandatory spending. In total, the legislation contains $60.8 billion in discretionary and mandatory spending that is not offset.