CHN: Domestic Spending for This Year Awaits Final Approval; The Process for Funding in 2010 is Underway

Unresolved differences between President Bush and Congressional Democrats over funding for most domestic programs for the current fiscal year which began on October 1, 2008 resulted in a temporary spending bill, called a continuing resolution (CR), which extends through March 6, 2009.  Only three of the 12 appropriations bills – Defense, Military Construction and Veterans Affairs, and Homeland Security – have received their full appropriations for FY 2009.  Funding for most domestic spending (except for programs like Medicaid and Social Security, which do not need annual appropriations) is largely frozen at 2008 levels in the CR.  However, to avert a reduction in services and to address the growing needs, some programs did receive annualized increases in the CR: the Women, Infants and Children (WIC) nutrition program, the Commodity Supplemental Food Program (CSFP) which provides food mostly to low-income seniors, Pell grants for low-income college students, the Low Income Home Energy Assistance Program (LIHEAP), and the Social Services Block Grant program.  For more details see Human Needs Report for October 9 at:  Congress intends to complete work on FY 2009 appropriations by passing an omnibus bill soon after it returns from President’s Day recess on February 23.
The American Recovery and Reinvestment Act, H.R. 1, which just passed the House and Senate on February 13, contains one- or two-year increases for a number of annually appropriated programs.  (See article in this edition of the Human Needs Report.)  These increases for budgeting purposes are considered emergency and temporary and will not be included in the baseline (starting point) that the Budget and Appropriations Committees will use for their work in determining funding levels for programs in FY 2010.

Typically the budget progress begins when the President releases his budget request to Congress during the first week of February.  The House and Senate then work to pass Budget Resolutions.  If they can come to agreement they then pass a Joint Budget Resolution which sets overall spending guidelines.  The outline provided by the Budget Resolution does not have the force of law and is not signed by the President (nor can it be vetoed by him).  By law the Budget Resolution is supposed to be approved by Congress by April 15, a deadline that often is not met.  Once the Resolution is passed and the overall spending level set, the House and Senate Appropriations Committees allocate the money to their 12 subcommittees, which work through the summer to distribute their allocations among the discretionary programs under their jurisdiction.

When a new Administration comes into power, the budget timeline is adjusted.  The Obama Administration has signaled that it plans to release a budget with an overall total for annually appropriated (aka “discretionary”) spending in the last week of February.  It will also subdivide spending by function, (broad categories such as national defense or education).   The Administration’s first budget will probably also include at least some of its assumptions for spending in mandatory or entitlement programs that do not need annual appropriations, as well as its projections for revenue and the likely size of the deficit by the end of FY 2010.   Enough detail will be included in the President’s budget for the House and Senate to begin work on their Budget Resolutions.  The House and Senate both plan to complete their budgets before Congress takes spring recess beginning April 4.  The Administration will release a more detailed program-by-program budget later in April which will signal to the Appropriation Committees its funding preferences for individual programs.

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