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Time for Some Heartfelt “Thank you”s

May 5, 2017

The Alliance and all FDA stakeholder groups need to express gratitude to the Members and staff of the Appropriations Committees. For increasing FDA funding by nearly $70 million, we say: “Thank you.” Remarkably, they also anticipated problems likely to be created by the President’s budget request for FDA and they said: “No, we won’t play your budget games.” For this, we also say: “Thank you.”

Taken together, the two provisions, described and discussed below, will give FDA a fighting chance in what is likely to be a very difficult budget year.

The first piece of good news for FDA is the Committees’ report language that reads:

Further, USDA and FDA should be mindful of Congressional authority to determine and set final funding levels for fiscal year 2018. Therefore, the agencies should not presuppose program funding outcomes and prematurely initiate action to redirect staffing prior to knowing final outcomes on fiscal year 2018 program funding.

This negates an OMB directive that agencies should begin reducing their staffing levels to match what the President will be requesting for their agency. We anticipate that the President will recommend nearly the same total funding for the agency, but try to switch a billion dollars or more from budget authority (BA) funding to new proposed user fees. We don’t know if this will involve cuts in staffing levels; it may not.  At a minimum, the appropriations language in the Omnibus will prevent further erosion of FDA’s staffing levels between now and when the FY 18 appropriation for the agency has been determined.

The second piece of good news for FDA is contained in Section 716 of the Omnibus bill:

None of the funds appropriated by this or any other Act shall be used to pay the salaries and expenses of personnel who prepare or submit appropriations language as part of the President’s budget submission to the Congress for programs under the jurisdiction of the Appropriations Subcommittees on Agriculture, Rural Development, Food and Drug Administration, and Related Agencies that assumes revenues or reflects a reduction from the previous year due to user fees proposals that have not been enacted into law prior to the submission of the budget unless such budget submission identifies which additional spending reductions should occur in the event the user fees proposals are not enacted prior to the date of the convening of a committee of conference for the fiscal year 2018 appropriations Act.

This is not the easiest language to parse. However, our interpretation is that the Administration can’t propose any new user fees unless they identify exactly what programs they would cut to offset the revenue that would have come from the proposed user fee. If this is correct, the following two examples illustrate how it would work.

If the President proposes $1 billion in total food safety funding and it includes a proposed $250 million user fee as part of this total, … then the Administration would have to say: if no user fee is enacted, then take the $250 million from X (for example, nutrition programs and FSMA enforcement). This forces OMB to own the consequences of trying to fund FDA food programs with user fee proposals that are dead on arrival.

If the President proposes $2.7 billion in medical product funding, of which $1 billion would be new user fees, … then the Administration would have to acknowledge that if the user fees aren’t adopted then the consequence (assuming the cuts would come from medical products) would be wiping out more than half of the BA funding that supports CDER, CBER, CDRH, NCTA, CVM and the Office of the Commissioner.

At this point, we are educating Congress that the new user fees being proposed by the President represents “paper savings only” and in the real world will require massive spending cuts in the neighborhood of 37% of all BA funding. In both cases, having the Administration specify funding cuts gives us a more concrete and salient talking point than we have now.

Join me in writing, e-mailing, or tweeting “thanks” to the Members and staff of the Appropriations committees. They really delivered for us in the FY 17 Omnibus.

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