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Potential Promise … But Storm Clouds on Horizon

May 10, 2019

Q: The House appropriations committee marked up the L-HHS bill this week and NIH (and other public health programs) did quite well. Is that a portent of good things for FDA?
A: Maybe. There appears to be renewed awareness that investing today in agencies such as NIH and CDC will pay off tomorrow. This is also true for FDA and over the last decade the Ag/FDA appropriations subcommittees have proven to be great supporters of the agency. That is reason for optimism. On the other hand,  the L-HHS subcommittee was allocated $11.8 billion over FY 19, a 6.6 percent increase. Ag/FDA was given only a 3% increase. However, there are a lot of variables involved in determining  how much money is available for agency increases. So, this comparison may be more dramatic than the reality of how much each subcommittee has to spend.

Q: None of these early House numbers matter if no agreement is reached to raise the spending caps for FY 19. How might that play out?

A: It would be easier to resolve (and to predict) if there were just two sides trying to find some middle ground to agree upon. However, both House and Senate know that the caps need to be raised, but the President has hinted he would veto such a deal. There are defense hawks who favor raising only the defense cap or raising it by a significantly greater degree than non-defense, while there is sentiment in the House to give a larger cap increase to non-defense programs. There are at least a few Members of Congress who would be okay if the OCO (overseas contingency operations, essentially war funding), which is off-budget, were used to increase defense spending. Democrats and some Republicans (including some defense hawks) feel that would be a dangerous budgetary precedent. If caps are to be raised, some constituencies in Congress are for bringing it only up to the FY 19 level, while others are looking for major increases in the caps, albeit with many groups proposing different target numbers.

It seems unavoidable that this will be resolved by leadership — House and Senate, Democrat and Republican. There is the will on the Hill for the budget deal to be done quickly. However, that seems unlikely given the number of different viewpoints and the  ideological bent of discussions.

Q: Is there any chance that the Congress will finish the FY 20 appropriations by October 1?

A: That seems unlikely. In several recent years, we thought Congress was going to achieve “regular order” appropriations and be done by the start of the new fiscal year. Those years were more promising than this one, but still all or some of the government was funded on a Continuing Resolution on October 1. There are a number of reasons why the process slows, but this year’s key one — the need to raise budget caps already in law — is going to be hard to resolve.

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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