Government Shutdown Averted
Late September 30, President Obama signed a continuing resolution (CR) funding government programs through December 11, thereby forestalling a government shutdown. Both the Senate, by a vote of 78 to 20, and the House of Representatives, by a vote of 277-151, passed the CR earlier that day.
While the CR is considered to be "clean," and does not include controversial language defunding Planned Parenthood or other major policy changes, it does include a 0.21 percent across-the-board reduction to discretionary spending programs to stay within the FY2016 budget caps as set by the Budget Control Act (BCA) of 2011.
The CR also includes language allowing the Rural Housing Service (RHS) to amend rental assistance contracts for Section 515 rural rental housing and Sections 514 and 516 farm labor housing to provide supplemental funding for properties that had previously exhausted their funding under contracts entered into or renewed in FY2015. Prior to the CR’s passage, previous appropriations language had prohibited RHS from amending those contracts.
The CR provides time for budget negotiations, which Senate Majority Leader Mitch McConnell (R-KY) and House Speaker John Boehner (R-OH) have begun with President Obama, with the goal of modifying the BCA-determined FY2016 and FY2017 budget caps. Staff reportedly already have begun work on determining a new total spending limit and finding offsets for what is expected to be a two-year deal.
Senate Armed Services Committee Chairman John McCain (R-AZ) supports an additional $76 billion in defense spending over the two-year period. Democrats are pressing for an equal increase in non-defense discretionary programs, for a total of $152 billion above the current caps. However, the scope of the proposed cap increase and whether budget talks will be successful at all remains to be seen, and could be impacted by Speaker Boehner’s impending resignation, effective October 30.
An end of year spending package could include other major items, including a multiyear transportation bill, international tax reform, and tax extender legislation.