Federal Update: Congress Tees Up Busy April

March 30, 2017

Following last week’s abrupt withdrawal of the GOP healthcare bill, Congressional Republicans huddled this week to regroup and refocus on the agenda ahead. In the near term, the Senate will turn its focus next week to the nomination of Judge Neil Gorsuch (JD’91) to the Supreme Court hoping to secure a visible win for the Trump administration and the Republican Congress. Congress will also be focused on finalizing FY17 appropriations before current funding expires on April 28.

FY17 (and beyond) Funding

The government is currently funded through a stopgap continuing resolution (CR) that runs through April 28.  Congressional appropriators signaled this week that they are working to resolve differences among parties and chambers to ease the way for an omnibus package or a series of “mini-buses” that would finalize the remaining 11 appropriations bills for FY17 (Military Construction-Veterans Affairs funding has already been completed).  While Democrats and Republicans work through the traditional funding sticking points, they also face complications from the Administration.

In the midst of the intense GOP effort to replace the ACA, President Trump released his “skinny budget” for FY18 (reported here) as well as a $33 billion supplemental Defense and border-security request for the current fiscal year.  The FY18 budget outline proposed broad, deep cuts to research, education, and student-aid accounts government wide, including the elimination of multiple agencies, and the outline drew wide criticism from Democrats and Republicans, who all but declared the budget proposal a nonstarter. The supplemental for FY17 recommends substantial new investments in military equipment as well as initial funding for programs that would support the construction of the border wall.  Unlike past supplementals which usually rely on emergency or off-budget war funding, the initial proposal from the Administration indicated offsetting cuts elsewhere in non-Defense programs without providing details.

This week, news media reported on a leaked list of $18 billion in proposed cuts for the current fiscal year to help pay for the Administration's Defense and security supplemental request, with research and education again being hit hard in this proposal.  While these cuts, if enacted, would be devastating at any time, they would be particularly difficult for agencies to absorb so deep into FY17.  Enacting funding levels is up to Congress, and appropriators—even the deficit hawks—are usually fiercely protective of the accounts within their jurisdiction, so the idea of making significant cuts to them mid-fiscal-year is anathema.  Even if Republicans in the House reversed course and attempted to boost Defense spending at the expense of non-Defense, doing so would require a change to statutory budget caps and therefore 60 votes in the Senate, which would be exceptionally unlikely given the chamber’s current 52-48 split. At this point, appropriators have indicated they intend to deal with the request within their final FY17 bills but do not seem to be adopting any of the proposed cuts; instead looking to emergency designation, currently funded activities, or delaying decisions on this funding until later fiscal years. However, it is a significant complication to efforts to move the FY17 funding bill. 

Despite a bipartisan desire to finalize FY17 funding through an omnibus or series of bills ahead of the April 28 deadline, there may not be agreement on policy or simply enough time to meet this goal, which would likely mean Congress simply extends the remainder of the year with a level-funded CR and starts anew with the FY18 process.  Among the stickiest issues are expiring health benefits for coal miners, funding for Planned Parenthood, money for a physical border wall, and the potential for increased Defense spending without a dollar-for-dollar non-Defense increase. How Republicans and Democrats navigate these waters, and the willingness of the Trump Administration to accept a compromise, will determine the final form FY17 funding takes.

At the same time, Congress is also beginning its consideration of the President's "skinny budget" for FY18, with early hearings.  The hearings have been hamstrung by new Administration guidance to agencies that would prohibit their discussing the budget proposal in any detail beyond that contained in the published blueprint. It seems this led to the postponement of congressional hearings with NIH Director Francis Collins and Secretary of Education Betsy DeVos earlier this month.  Health and Human Services Secretary Tom Price did testify at the House appropriations subcommittee that oversees his budget on March 29.  Many members expressed deep concern about the disastrous NIH cuts. Price expanded on the brief language included the blueprint on inefficiencies to single out Indirect Cost as an area for examination and savings, which he argued could be redirected to “actual” research.  Several members did pick up on this thread in their dialogue with the Secretary, some critical of this support, others—like Congresswoman Katherine Clark (D-MA, MPA’97)—supportive, but most agreed that there was more to look into here, suggesting work ahead for research community advocates. 

The Order of Events

On Monday, April 3, the Senate Judiciary Committee is primed to report Judge Gorsuch’s nomination favorably, and Majority Leader Mitch McConnell (R-KY) announced a full Senate vote will be held on Friday, April 7.  The nomination’s future, though, is unclear, as Democrats intend to filibuster Judge Gorsuch, leaving in play the so-called “nuclear option” that would entail changing Senate rules to remove the 60-vote threshold for Supreme Court nominees.  After next week, Congress will go into a two-week Easter/Passover recess before returning the week of April 24 – leaving them just four days to finalize current year spending before the current CR expires.

Once the decks are clear of FY17 funding and the Supreme Court nomination, Republicans and the Administration may take another shot at replacing the ACA or move on to tax reform because the procedural architecture that would allow these bills to move through the House and Senate with simple majorities only allows for one at a time. They could also move to consideration of the FY18 Budget Resolution.

Harvard’s Advocacy

As Congress negotiates these issues, our federal relations team remains closely engaged on University priorities, from academic and scientific research to student aid, and we will continue working with policymakers, key stakeholders, DC-based coalitions and associations, and fellow institutions to protect and advance these critical issues.  As always, please feel free to reach out to Kevin Casey (kevin_casey@harvard.edu), Suzanne Day (suzanne_day@harvard.edu), and Jon Groteboer (jon_groteboer@harvard.edu) with any questions or concerns.