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CR-Level Funding at Start of FY 20 Approaches Certainty

September 13, 2019

Congress is back and the FY 20 funding situation has evolved. This is an update on our last two columns, “What Can Go Wrong?” (August 23, here) and “What Needs to Go Right?” (September 6, here).

What needs to go right: Primarily, the House and Senate 302(b) allocations need to come into alignment to: (1) unblock the DOD/L-HHS minibus, (2) assure that the later non-defense bills aren’t either enriched or shortchanged by L-HHS funding levels (which are about one-third of all non-defense spending), and (3) reflect that the House position on non-defense spending must be reduced by $15 billion to come into alignment with the Senate levels, which are set at the BBA ceiling.

Agreement on L-HHS funding would set the stage for the first minibus (DOD, L-HHS, another agency or two) to move forward in September, possibly even become law. While most of the rest of the government would still need to be funded under a CR, fast resolution of the first minibus should create momentum to address other spending bills (albeit, likely after October 1).

What could go wrong: the substantial differences between the House and likely Senate positions created a catalog of things that could derail progress.

House and Senate are misaligned on non-defense spending levels and have different priorities within the BBA ceilings.  The Senate adopted 302(b) allocations this week, which was the essential first step in resolving misalignment on both spending levels and spending priorities. The House can now formulate a new position with the ability to compare what they want with what the Senate wants.

Difficulties with non-defense spending may doom any early agreement to combine defense and HHS funding together. The Senate’s postponement of the L-HHS mark-up delays the entire appropriations process. While the progress made by the Senate 302(b) allocations is tangible, there are additional disagreements that will need to be resolved in the Senate, even before it’s position can be reconciled with the House.

Setting program funding levels may be easier than resolving any appropriations riders not covered by the BBA agreement. To get BBA passed, there were a number of side agreements, including one to maintain status quo on the controversial “poison pill” riders, which were not individually specified. That has left a lot of unknowns and became one of the factors that delayed the September 10 L-HHS subcommittee mark-up.

Manipulation of FY 19 spending undermines goodwill generated by the BBA agreement.  Congress continues to talk with the Administration about end-of-the-year FY 19 monies that could go unspent because of Administration policy objections. House and Senate leadership would like to see these resolved so they don’t become issues during consideration of the FY 20 CR.

Consequences of a CR. It is now virtually certain that FDA will begin the fiscal year with CR-level funding. The consequences of a CR are severe, even though they may be temporary. The FDA would need to carry out its programs using the FY 19 (prior year) funding levels, without the increased monies proposed for FY 20 by the House. Further, FDA would be limited in its ability to start new initiatives for as long as it is on CR funding. Last (but hardly least), CRs create uncertainty, which makes program and personnel planning difficult.

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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