Q&A: consequences of delay in FY 22/23 appropriations; Timing for user fee reauthorization.

The Consequences of Delays in the Funding of FDA

Q: Do delays in finalizing FY 22 appropriations affect the discussion of the President’s FY 23 budget request?
A: Yes. In the absence of FY 22 base funding levels, the President’s request will compare his proposed FY 23 numbers with FY 21 base funding. This will cause confusion that will continue for the entire funding cycle. If, for example, the President calls for a $200 million increase at FDA (from the $3.2 billion in FY 21 to $3.4 billion) it will be unclear if that is new money (above FY 22) or not new money (if, as we hope, FDA receives $3.4 billion in FY 22).

Q: Do delays in the State of the Union and the President’s Budget Requestion push back the entire FY 23 appropriations process?
A: Only to a degree. As 2022 is an election year, Members of Congress have an understandable incentive to hit the campaign trail. Typically, this means that FY 23 appropriations needs to be completed (or a two-month CR enacted) by the first week of October. Consequently, early delays will likely yield compression rather than extension of the FY 23 appropriations process.

Q: If the FY 22 appropriations bills are completed by March 11, what are the likely impacts on FDA for both FY 22 and FY 23.
A: For FY 22, FDA will have less than 7 months to implement all its new initiatives, address backlogs created by pandemic work and the late arrival of funds, make sure staff needs are met, and assure critical personnel decisions are made. We often talk about how CR’s wreak havoc with program and personnel planning. This is what will be occurring.

The FY 22 funding levels are based on FDA’s needs last summer and FDA will need to gain further ground when the President’s FY 23 budget is released. FDA’s workload continues to grow at a rapid pace—additional responsibilities from Congress, increased complexity of science, globalization of the food and medical markets, and unplanned but urgent public health needs.

Q: How important is the timing of the user fee renewal legislation?
A: While outside our usual range of questions, we do have some insights based on watching recent user fee renewal cycles. The optimum situation is for the legislation to reach the President’s desk no later than August 1. Earlier would be even better.

Why is timing so critical? First, many of the user fee invoices should go out in August and September for payment at the beginning of, or early in, the upcoming fiscal year. Second, FDA will likely need to send out 60-day termination notices (i.e., on August 1, 2022) to anybody whose position would be unfunded if the user fee programs were not reauthorized for FY 23. Even if you feel certain the user fee programs will be renewed, it is unnerving to receive a termination notice or listen to workplace assurances that you will still have a job. This will impact morale and, potentially, employee retention.

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