CHN: Senate to Take up Spending Cuts Package This Week

June 19, 2018

The Senate will take up the White House’s proposed package of domestic spending cuts, also known as rescissions, this week, just in time to meet the June 22nd deadline for using special rules that would allow the package to pass with a simple majority vote. While Senate Majority Leader Mitch McConnell (R-KY) had previously not said whether he would bring up the package, the bill’s sponsor, Sen. Mike Lee (R-UT), collected signatures from 20 senators to trigger a little-used rule in the Senate to force the bill out of committee and onto the floor. The House narrowly passed (210-206) the package, which totals nearly $15 billion in cuts, on June 6; 19 Republicans joined all Democrats in opposing it. All Democrats in the Senate are expected to oppose it too, and its passage in the Senate is not a done deal, since several Republican Senators have also voiced concerns about the package.

Proposed by the Trump Administration, the package would cut roughly $7 billion from the Children’s Health Insurance Program (CHIP), including nearly $1.9 billion from a CHIP reserve fund that could make it harder for states to respond to rising enrollments in the aftermath of disasters or rising unemployment. According to the National Low Income Housing Coalition, the package includes $220 million in rescinded funds from housing, rental assistance, and community revitalization efforts that, if passed, would exacerbate the affordable housing crisis in this country. The rescission specifically targets funds for a program that helps improve the outcomes of public housing residents and helps them to gain self-sufficiency. The package also cuts or “rescinds” $800 million from a program that funds Medicare and Medicaid innovations – a program that is estimated to save $3 for every $1 spent. Other unspent funds to be rescinded have previously been approved by Congress as part of bipartisan agreements that allow needed increases in health, education, and other important programs.

In an effort to get more votes for the package in the House, the Trump Administration revised the package to eliminate some other controversial cuts, including money to fight the Ebola virus in Africa and funds to help victims of Superstorm Sandy. The current Senate version of the package mirrors the original Trump proposal, before the revisions, though that could change. The Congressional Budget Office, Congress’s nonpartisan scorekeeper, has said the rescissions plan would reduce the deficit by $1.1 billion over the next decade (the estimate of deficit reduction is so low because CBO estimates that under current law, much of the money would not be spent). Office of Management and Budget Director Mick Mulvaney had said additional rescissions packages may follow in the coming months.

Once OMB sends a rescissions request to Congress, Congress has 45 days to vote on all of it, part of it, or none of it, and rescissions can be passed with a simple majority in both chambers. According to CQ, even without congressional action, the funding proposed in the request is frozen for 45 days. And because the days are counted when Congress is in session, funds proposed for cancellation could be blocked for months, especially considering the congressional calendar in an election year. However, Congress can reject the rescissions sooner, and, if Congress takes no action to approve the rescissions, funding is reinstated at the end of the 45 legislative day period.

Advocates oppose the rescissions not only because of the bad cuts to housing, health, and other programs, but because they believe the loss of these dollars will make it harder to provide adequate funding levels for human needs priorities in FY19 and beyond. Funds that are genuinely not needed have been the source for increases in other domestic programs; if these funds become unavailable, such increases cannot occur. CHN was joined by 150 national organizations in sending a letter to Congress opposing the cuts. While many human needs programs received funding increases in FY18 over FY17 levels, new research by CHN found that nearly 70 percent of more than 181 important human needs programs tracked have lost ground since FY 2010 after adjusting for inflation. This and future rescissions packages, if approved, would prevent continuing the progress made this year in restoring adequate funding levels for these programs. The rescissions package would also set a dangerous precedent for undoing bipartisan spending decisions. For more information, see CHN’s statement on the rescissions package.



Categories: Budget and Appropriations