White House and Congressional Leaders Reach Deal on FY 2020 & 2021 Budget

On August 2, President Trump signed into law a two-year federal budget deal totaling $2.7 trillion.

Background

The White House and congressional leaders announced on July 22 that a comprehensive deal had been worked out on the top line spending numbers for the U.S. discretionary budget for fiscal years 2020 and 2021. Pressure had been mounting on negotiators to reach a comprehensive budget deal that includes a two-year budget and raising the statutory debt ceiling. On July 12 Treasury Secretary Mnuchin testified before Congress that the U.S. may reach its statutory borrowing limit to pay its financial obligations by early September. The timing of the deadline on the statutory borrowing limit could impact the six-week district work period during the month of August prior to Congress returning after the labor day holiday.

The top line spending for both discretionary defense and non-defense programs totals $1.37 trillion for FY 2020, about $50 billion higher than FY 2019 level. For FY 2021, the top line number increases to $1.375 trillion.

For FY 2020, the budget deal would raise discretionary defense spending by $22 billion, to a total of $738 billion. Non-defense domestic program spending would increase by $27 billion, totaling $632 billion. The U.S. debt limit would be suspended through July 31, 2021.

The agreement also avoids automatic, across-the-board spending cuts established in the FY 2011 Budget Act.

Annual Appropriations for FY 2020 Still Incomplete

The U.S. Senate has not considered any of the appropriations bills to date. Chairman of the Senate Appropriations Committee, Richard Shelby (R-AL) has told members of the Senate Appropriations Committee that coming to an agreement on topline spending numbers is very important before the Senate takes up fiscal year 2020 appropriations. Senate and House leaders are continuing to work with the White House on reaching an agreement for the FY 2020 budget. Chairman Shelby also warned members about keeping controversial policy riders, “aka poison pills,” out of the appropriations process this year as they are likely to be considered on an expedited basis.

The U.S. House has completed work on ten (of the total twelve) appropriations bills for FY 2020. The ten bills were bundled into two, five-bill “minibuses” and included:

H.R. 3351, making appropriations for Financial Services and General Government was adopted 224-196, on June 26, 2019. The bill totals $24.55 billion.

H.R. 3055, adopted 227-194, on June 25, 2019. This 5-bill appropriations package totals $583.3 billion.

  1. (Departments of) Commerce, Justice, Science and Related Agencies Appropriations Act, (CJS),
  2. Agriculture, Rural Development, Food and Drug Administration,
  3. Interior and Environment,
  4. Military Construction, Veterans Affairs,
  5. Transportation and Housing and Urban Development Appropriations Act.

H.R. 2740, adopted 226-203, on June 19, 2019. This 4-bill appropriations package totals $983 billion.

  1. Labor, Health and Human Services, Education
  2. Defense
  3. State and Foreign Operations
  4. Energy and Water.

Agriculture, Rural Development, Food and Drug Administration

The FY 2020 Appropriations Bill for Agriculture, Rural Development, Food and Drug Administration and Related Agencies contains total discretionary funding of $24.3 billion for the Department of Agriculture, which is $1 billion above the fiscal year 2019 enacted level. In total, the bill allows for $155.3 billion in both discretionary and mandatory funding – $3.2 billion above the fiscal year 2019 enacted level.
Some of the details in bill include:

Rural Broadband – The legislation invests over $680 million in the expansion of broadband service to provide economic development opportunities and improved education and healthcare services. These significant investments in broadband reflect a commitment to enabling Americans in rural communities to access digital tools necessary to improve health, educational, and economic outcomes.

Supplemental Nutrition Assistance Program (SNAP) – The bill provides for $71.1 billion in required mandatory spending for SNAP. This includes $5 billion for the SNAP reserve fund.

Food and Drug Administration (FDA) – The FDA receives a total of $3.26 billion in discretionary funding in the bill, $184 million above the 2019 enacted level. Total funding for the FDA, including revenue from user fees, is $5.86 billion. Within this total, the Committee provides target increases for medical product and food safety activities, including new initiatives to revolutionize the safety of the nation’s blood supply and to enable faster responses to foodborne illness outbreaks. In addition, the bill includes a strong focus on continuing FDA’s efforts to advance generic drug reviews and increase medical product manufacturing in the U.S. The bill also appropriates $75 million to accelerate medical product development as authorized in the 21st Century Cures Act.

Marketing Programs – The bill provides $183 million, $24 million above 2019 and $68 million above the request, to facilitate the movement of agriculture products and open market opportunities. This includes $18 million for the National Organic Program to protect the integrity of the USDA Organic label. The bill also provides $23.4 million in discretionary funds to the Agricultural Marketing Service and Rural Development for the Local Agriculture Market Program to continue supporting local food and value-added agriculture.

The measure includes $16.5 million for USDA-AMS Specialty Crop Division to implement Industrial Hemp provisions in the 2018 Farm Bill. The Committee understands that USDA is working on implementing the Hemp Production Program as authorized by the 2018 Farm Bill and encourages the Department to use existing resources to issue regulations as soon as possible.

Animal and Plant Health – The legislation includes $1.034 billion – $23 million above the fiscal year 2019 enacted level – for the Animal and Plant Health Inspection Service. This funding will support programs to help control or eradicate plant and animal pests and diseases that can be crippling to U.S. producers. The funding level provides increases that will help address harmful pests and diseases such as cattle fever ticks and chronic wasting disease, while maintaining increases from past years for citrus greening.

Of the total amount provided to APHIS, $186.5 million is provided for Specialty Crop Pests. This is $513,000 above the FY 2019 level. Within the amount included for Specialty Crop Pests, the Committee includes:

  • $63,640,000 for fruit fly exclusion and detection;
  • $61,000,000 for citrus health, including $3,000,000 for the Huanglongbing Multi-Agency Coordination efforts;
  • $21,100,000 for the glassy-winged sharpshooter;
  • $6,318,000 for the pale cyst nematode;
  • $6,500,000 for the light brown apple moth;
  • $6,600,000 for the European grapevine moth; and
  • $12,000,000 for spotted lanternfly.

USDA-APHIS Wildlife Service Damage Management is increased by $1.4 million above the FY 2019 level, to $109.8 million.

Interior and Environment

he FY 2020 Appropriations Bill for Interior and Environment and Related Agencies includes total discretionary funding of $37.3 billion. The House increased the annual EPA budget by $3.3 billion over the Trump Administrations budget request and $1.73 billion over the FY 2019 enacted level.

Environmental Protection Agency (EPA) – The bill provides a total of $9.53 billion in for EPA – $677 million above the 2019 enacted level and $3.30 billion above the President’s budget request.
Of this amount, the bill includes $4.42 billion for State and Tribal Assistance Grants (STAG). This includes a total $3.08 billion for Clean Water and Drinking Water State Revolving Funds which is $319 million over the FY 2019 enacted level.

Of the total $3.08 billion, $1.3 billion of the funding is provided to the Drinking Water State Revolving Fund & allows the financing of green infrastructure and energy efficiency projects. $1.3 billion is the authorized level of appropriation for FY 2020 in the America’s Water Infrastructure Act (AWIA) that was enacted in October 2018. AWIA reauthorized the Drinking Water State Revolving Fund (SRF) program and amended the list of eligible uses for Drinking Water SRF. It also gave states new authorities and requirements for administering the program. For FY 2021 AWIA authorizes $1.95 billion for the SRF Fund.

If Congress and the Administration can find a way to agree on a comprehensive infrastructure package for the U.S., House Democrats are readying a proposal that will significantly increase the amount of funding for the Drinking Water State Revolving Fund to:

$4.14 billion in FY 2022 $4.8 billion in FY 2023 $5.5 billion in FY 2024.

Negotiations broke off between House Democrats and The White House in late May. Efforts continue to revive negotiations and find ways to pay for the infrastructure package. House leaders on the Energy and Commerce Committee are ready to include drinking water provisions into an infrastructure package if it begins to move in Congress.


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