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FY 20 President’s Budget Request; Spin and Reality

March 8, 2019

White House acting chief of staff Mick Mulvaney has said that the starting point for non-defense funding is the budget cap required under the Budget Control Act of 2011, which is about $55 billion below FY 19 funding levels. Beyond that, he has said that federal agencies were directed to produce budgets that assume another 5 percent cut.

So, whatever is in store for FDA in the President’s Budget Request, the overall climate for health programs is likely to be bleak. We are still hopeful for FDA because the Administration’s request last year (FY 19) so clearly recognized both needs and opportunities that required increased FDA funding.

It is guaranteed that OMB will make the FDA request sound much better than it really is. For example, in some recent years, the President has asked for food user fees that would replace BA dollars. Typically, a billion dollars for food safety (all BA dollars) might become a request for $800 million in BA and $250 million in proposed (and unrealistic) food user fees. OMB would say its proposal is a $50 million increase … while we would say that it has the effect of a $200 million cut because the Appropriations committees will need to find at least that much in additional BA dollars before the program would reach the prior year’s level.

This is not a partisan thing on OMB’s part. Regardless of who is in the White House, OMB tries every year to place the President’s request in the best light.

The OMB “headline” numbers will be widely circulated in the media, even though they do not provide an accurate or meaningful picture of the actual proposal being made by the President. The important numbers are in the budget tables,* not in the OMB summaries.

Here are some things to consider before believing or repeating the headline numbers:

  1. Proposed user fees are counted as actual funding, even though they are unlikely to become law or turn into dollars that the agency can spend.
  2. Annual increases built into the user fee agreements are treated as new dollars proposed by the President.
  3. Adding BA appropriations and user fees together provides an inaccurate picture of the President’s budget request. User fee monies are collected for very specific purposes and, while very valuable to the agency, cannot be used to pay for a wide variety of programs or fund new priorities and evolving needs.
  4. More than $700 million of the user fees are for the tobacco center and not available for FDA’s traditional responsibilities for safe foods and safe and effective medical products. (For a better understanding, go to the second question here. For a more in-depth analysis of how tobacco fees distort the FDA’s budget, go here.)

Further, ignore those who say you don’t have to pay attention because the President’s budget is dead on arrival, pointing to the likelihood that at least $50 billion will be added to the proposed non-defense spending. The reality: whether Congress accepts or rejects the President’s proposals or adds more money, his numbers will be used as a baseline when the subcommittees mark-up. That matters.

As soon as we have a firm grasp on what the President is actually proposing, we will be back to the Alliance membership with details that you can rely upon.

Editorial note: The Analysis and Commentary section is written by Steven Grossman, Deputy Executive Director of the Alliance for a Stronger FDA.

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* For those inclined to DIY: once text of the President’s request and supporting justification become available, I immediately search for the All-Purpose Table and the Summary of Changes, then start comparing them to the Budget Authority Crosswalk and Budget Authority by Activity.

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