Unclear Picture for 2020 Federal Appropriations Bill

The multi-step process for Congress to approve an annual appropriations bill kicked off in April, setting the stage for bicameral, bi-partisan, and intraparty negotiations to fund the federal government. Looming over these negotiations is the threat of funding cuts under the Budget Control Act of 2011 and the President’s request for boarder wall funding, a request that held-up this fiscal year’s appropriations bill for months, shutting down parts of the government, including HUD.

 

The first step in the process is for Congress to lift budget caps and avoid steep cuts in funding through “sequestration,” as required under The Budget Control Act, passed in 2011. In April, House Democrats proposed a bill to lift the caps by $361 billion for fiscal years 2020 and 2021, but the bill was pulled from consideration after some Democrats voiced concerns and requested increased funding.

 

The House instead adopted a “deeming resolution” to allow the Appropriations Committee to begin work on a 2020 spending bill.  The resolution passed 219-201, with seven Democrats voting “No.”

 

On May 8th the House Appropriations Committee put the deeming resolution into action and approved funding levels for all 12 of its subcommittees, including Transportation, Housing and Urban Development (THUD), the subcommittee that funds most housing programs. The THUD subcommittee was authorized to write bills up to $75.8 billion, which is a $4.7 billion increase (7%) over current levels. 

 

Even though the subcommittees have been authorized to begin work on the spending bills, ultimately, in order to move forward on a 2020 spending bill, both the House and the Republican controlled Senate must pass a spending cap bill and the White House must sign it into law. If a budget cap deal is not reached, and sequestration is triggered, next year’s budget will be slashed by $125 billion ($71 billion for Defense and $54 billion for nondefense), a 10% reduction from 2019.

 

The 2020 fiscal year begins October 1st.