Begin forwarded message: > From: Sarah Abernathy <abernathy@cef.org> > Date: January 12, 2017 at 3:15:38 PM EST > To: CEFMembersList <CEFMembersList@cef.org> > Subject: CEF Update: 01.12.17 -- Senate-passed budget resolution > > > > Thursday, January 12, 2017 > > Dear CEF Members: > > Senate passes fiscal year 2017 budget resolution – what does this mean? > > For those curious about the budget resolution now awaiting consideration by the House, below is a description of its purpose, why it won’t have a real effect on appropriations, and an amendment the Senate rejected that would have required dramatic spending cuts. > > · Senate passes 2017 budget resolution – Late last night the Senate voted 51-48 to approve a bare bones budget resolution for fiscal year 2017. Its main effect is to provide the reconciliation instructions that will pave the way for fast-track Senate consideration of legislation to repeal parts of the Affordable Care Act. (The House doesn’t need the special procedural protections offered by reconciliation because its Rules Committee can set parameters for floor consideration.) The House is expected to pass this budget resolution tomorrow without any amendments. > > · Reconciliation instructions – The resolution directs the committees with primary jurisdiction over health care (Senate Finance and Senate HELP, and House Ways and Means, and House Energy and Commerce Committees) to report legislation by January 27 that reduces the deficit by at least $1 billion (the total could be much larger, and could include gross increases and gross decreases as long as the net savings are at least $1 billion). It is not expected that the Senate HELP Committee will include any changes to student loan provisions in its reconciliation recommendations. We’re hearing that the instructed committees may miss the tight deadline for reporting their bills, especially as Republicans are now considering whether to include provisions to replace part of what they are repealing, rather than repealing Obamacare provisions first and then replacing some provisions later. > > · Budget’s spending levels do not actually change spending – The budget resolution sets spending, revenue, and debt levels for Congress to follow, but does not change any laws because it does not get signed into law. Thus, the budget resolution cannot amend the Budget Control Act caps on defense and non-defense discretionary (NDD) levels, but it can put in place budget points of order that could be raised against bills that violate certain limits. Existing examples of these procedural blocks include limiting the total amount of all advance appropriations, and providing a dollar limit or categorizing the circumstances for using “emergency” funding that is not subject to the discretionary caps. If nobody raises that point of order when a bill is considered, or if the House Rules Committee waives the point of order for a certain bill, then those budget resolution restrictions are not in effect. In addition, while the spending and revenue levels in the budget resolution generally assume enactment of certain policies, the budget resolution does not actually implement those policies. For example, recent Republican budget resolutions cut education spending levels on the assumption that Congress would eliminate all mandatory funding for Pell grants and eliminate subsidized student loans, but Congress never enacted legislation to make those changes happen. > > · Fiscal Year 2017 and 2018 discretionary caps are unchanged – As noted in our Update last Thursday, the spending and revenue levels in this budget resolution will not affect the FY 2017 appropriations bills still in limbo or the upcoming NDD or defense discretionary caps for FY 2018. This resolution sets spending levels at the Congressional Budget Office’s baseline level (i.e., discretionary spending at the cap levels, and mandatory spending at current law levels), with minor adjustments to reflect the continuing resolution. Current law levels for mandatory spending in budget function 500 (Education, Training, Employment, and Social Services) are therefore much higher than the levels in the budget approved by House Budget Committee Republicans last spring, which assumed large cuts in education spending. Since the 2017 post-sequester caps remain as set in law, it will be up to the Appropriations Committee this spring to live within those caps when it finalizes full-year funding for the 11 bills currently funded with a continuing resolution through April 28. If Congress decides to increase NDD funding in certain areas – say, for homeland security funding for a border wall – it will need to offset that increase with cuts to other NDD spending. > > · FY 2018 budget resolution later this spring – The spending levels in this budget resolution will be replaced by a 2018 budget resolution, probably in early April. That resolution is likely to assume changes in spending and revenue levels to reflect new Republican policies. I think it’s likely to cut NDD well below the austerity-level sequester cap for 2018, and assume defense spending above the defense cap – and that increase will require a change in the law setting the sequester cap. > > · Senate rejected 23 amendments – The Senate rejected all amendments, most on procedural grounds. All but one dealt with some aspect of repealing the Affordable Care Act, including an amendment by Senator Robert Menendez (D-NJ) to protect federal funding for states under the Medicaid expansion, which has some relevance to school health care funding. The only amendment not related to health care was the substitute offered by Senator Rand Paul (R-KY) designed to balance the budget within five years by freezing all on-budget spending (this excludes Social Security and the postal service). The amendment included many trillions of dollars of unallocated cuts, including $1.8 trillion in 2026 alone for “new efficiencies, consolidations, and other savings.” Cuts of the magnitude in this amendment would require devastating cuts to government services. The amendment was rejected by a vote of 14-83. > > Hope to see you all tomorrow at the CEF Friday meeting, 9am at the AFT offices (555 NJ Ave NW, 4th floor). > > - Sarah > > Sarah Abernathy, Deputy Executive Director > > 1800 M Street, NW > Suite 500 South > Washington, DC 20036 > T: 202-327-8125 > abernathy@cef.org > www.cef.org > > >