FDA and Continuing Resolutions: Everything You Need to Know

Q:  Is funding under a Continuing Resolution bad for FDA?
 
A:  Yes. The consequences of a CR are severe, even though CRs are usually temporary. The agency is currently carrying out FY23 programs using the FY22 (prior year) funding levels. They do not have the benefit of the increased monies proposed for FY23 by the President and both the House and Senate.

Further, FDA would be limited in its ability to start new initiatives (variously defined) for as long as it is on CR funding.

Last (but hardly least), CRs create uncertainty, which makes long term program and personnel planning difficult.

FDA stakeholders have much to gain from a smooth and timely appropriations process in December 2022, and nothing to gain from controversy, uncertainty, and funding under CRs.

Q: Are there reasons to be optimistic that FY 23 appropriations bills will be adopted in December?

A: Yes, there is a case for optimism. As difficult as it has been to negotiate compromises in Congress, the FY23 appropriations bills have three factors working in their favor.

First, a cohort of Republicans and Democrats in the Senate want to reach an agreement so that government spending is not the first fractious issue that a new House Republican majority takes up in the new year.  House Democrats agree.

Second, the Department of Defense fits into the same category as the FDA: agencies with rapidly growing missions that need additional resources. A full-year FY23 CR at FY22 funding levels would be a critically inadequate response. The Pentagon (along with the entire defense community) is pushing hard against a year-long CR.

Third, the FY 23 funding bills contain notable Congressionally directed spending (i.e., earmarks), all of which would be lost if there is a full-year CR. Many Members consider that incentive enough to reach a deal on the FY 23 spending bill.
 
Q: Are there reasons to be pessimistic that FY 23 appropriations bills will be adopted before next year?

A: Yes, there is a case for pessimism. Agreement on a topline number for total Federal discretionary spending is always elusive. House Republicans are likely to want delay on a deal until they become the majority in the House. Presumably, House Speaker Pelosi can pass funding bills without the Republicans, but it could get ugly.
 
Meantime, Senate Minority Leader McConnell says he wants FY23 appropriations issues resolved this year. He may not have sufficient support for that in the Republican caucus.

Also, Republicans have sharpened their rhetoric about too much federal spending. Apart from the need for more defense spending, Republicans might be satisfied with leaving non-defense spending at the FY22 levels. The Democrats might not agree with that, which could create a stalemate.

Q: Why isn’t there more information available about the negotiations and prospects for FY 23 appropriations bills?

A: In most years, the level of total spending (and the defense/non-defense split within that total) is resolved by leadership instead of the budget committees. Increasingly, that has tended to merge with the appropriations process, creating an endgame made up of the four leaders and the four Appropriations Chairs/Ranking Members. It is a far-reaching negotiation, and everyone holds their cards close to their chest.

Editorial Note: This week’s Analysis and Commentary section was written by the Alliance’s Executive Director, Steven Grossman.