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The Government is Open Again…Now What?

As everyone now knows, at almost literally the 11th hour on October 16th, the House and Senate agreed and the President signed two critical measures into law – HR 2775, the Continuing Appropriations Act of 2014 and H Con Res 25, the Budget Resolution.  These two measures reopened the Federal Government and allowed the U.S. Treasury to continue to meet its obligations.  More specifically, HR 2775 provides funding at existing FY 13 levels until January 15th, when across-the-board discretionary spending cuts are set to take effect under the terms of 2011’s Budget Control Act.  H Con Res 25 allows the President to suspend the debt limit until February 7th.

But what else do these measures do?

  • Calls for a bicameral budget conference.  House and Senate conferees must report by December 14th on a budget plan that considers taxes, entitlements, and discretionary spending for the remainder of the fiscal year before the CR expires on January 15th.  House Conferees include:  Paul Ryan (R-WI), Tom Cole (R-OK), Tom Price (R-GA), Diane Black (R-TN), Jim Clyburn (D-SC), Chris VanHollen (D-MD), Nita Lowey (D-NY).  Senate Conferees include all members of the Senate Budget Committee — 12 Democrats led by Patty Murray (WA) and 10 Republicans led by Jeff Sessions (AL).
  • By default, gives all Federal workers a one percent cost of living increase effective January 1.  Because the just passed measure was silent on raises, the default is President Obama’s Executive Order 13641 (April 2013) that ends the pay freeze and provides an across-the-board increase.
  • Increases the Army Corps of Engineers spending authorization for the Olmsted dam project on the Illinois-Kentucky border by $1.2 billion.
  • Extends the DHS Chemical Facility Anti-Terrorism Standards (CFATS) program designed to inspect and secure plants that store high levels of hazardous chemicals.
  • Provides $600 million to the Forest Service and $36 million to the Interior Department to replenish funds used in fighting wildfires.
  • Raises the Federal Highway Administration’s emergency spending cap from $100 million to $450 million to cover Colorado flood damage.

The next steps will need to be taken carefully.  Will Congress decide to reevaluate discretionary spending levels for bare-bones budgets at agencies like EPA and Department of Interior?  Will the House determination to follow the letter of the law as prescribed by the 2011 Budget Control Act that would decrease discretionary spending to $967 billion prevail…or will the Senate’s preference to vacate that language and return to a more traditional funding scheme ($1,058 trillion) be the preferred approach?  Can Congress solve the problems they’ve created through normal means or will they establish another “Super Committee” to try to strike a “grand bargain”?  These are all questions we’ll follow with interest in the weeks and months ahead.