On October 16, 2013, the Senate and House approved and the President signed, HR 2755, a Continuing Resolution (CR) which provides FY 2014 appropriations for three months, thus allowing the federal government to reassume full operations. It also suspends the statutory debt limit through February 7, 2014. The CR will provide funding at the FY 2013 post-sequestration level through January 15, 2014. The agreement came literally at the midnight hour as the Treasury Department had determined that the federal government would no longer be able to borrow money to pay its already incurred obligations as of October 17.
In separate action, also on October 16, the House and Senate agreed, via unanimous consent resolutions, to establish a House-Senate conference committee charged with reaching an agreement on a FY 2014 Budget Resolution and making other proposals in an effort to negate the necessity of another round of sequestration of funds, currently set to go into effect in mid-January. We report below on the CR and on the newly formed committee.
FY 2014 Continuing Resolution.
The CR does not, as advocated by the most conservative Republicans, repeal or de-fund the Affordable Care Act (PL 111-148) which includes the authorization of the Indian Health Care Improvement Act. Insistence by House Republicans on including such ACA provisions in the CR led to the 16-day partial federal government shutdown.
Also of note is that the CR does not contain the provision recommended by the Office of Management and Budget (OMB) but opposed by Indian Country to impose contract support costs caps on individual Indian Self-Determination Act agreements. Neither House nor Senate CRs accepted this OMB proposal.
Funding Level. The CR provides funding at the FY 2013 post-sequester level of $986.3 billion, a figure that is a compromise between the House Budget Resolution cap of $967 billion and the Senate Budget Resolution cap of $1.058 trillion. Funds will generally be provided on a pro rata basis at the FY 2013 levels under the authority and conditions of the FY 2013 Appropriations Act.
Limitations on the Distribution of Funds. Funds will not be distributed for programs that may have high initial rates of operation or for which funds are fully distributed at the beginning of the fiscal year based on the possibility that Congress might eliminate or reduce funding for those particular programs. With regard to distribution of funds during the covered period, the CR states: “this joint resolution shall be implemented so that only the most limited funding action of that permitted in the joint resolution shall be taken in order to provide for continuation of projects and activities.” However, agencies will be allowed to apportion funds in a manner that would avoid furloughing employees.
Mandatory Funding Programs. Funding for entitlement and mandatory payments which was provided for FY 2013 as well as activities under the Food and Nutrition Act will be continued at a rate that maintains current program levels. The CR will also extend the authorization for the Temporary Assistance for Needy Families program (although not for the program’s Contingency Fund) through the period of the CR.
Retroactive Pay for Furloughed Federal Employees. The CR provides for retroactive pay for federal employees furloughed as a result of the government shutdown (Section 115). Federal employees have not had a pay increase for three years, and the CR will provide them a one percent pay raise effective January 2014, although it will require a Presidential order to implement it.
Reimbursement for Grantees using Non-federal Funds during the Shutdown. The CR will provide reimbursement plus interest to states and other federal grantees (including tribes and tribal organizations which receive federal grant funds) who used state or non-federal funds to carry out grant programs which would have otherwise been provided by the federal government but for the shutdown (Section 116).
Indian Self-Determination and Education Assistance Agreements (ISDEAA) Retroactively Funded. The CR appropriates funds retroactive to October 1, 2013, (Section 118) and extends through January 15, 2014. Thus tribes operating under ISDEAA agreements should receive funding for operations for the entire period. If tribes and tribal organizations have furloughed employees during the October 1-16, 2013, shutdown, they can use their CR funding, among other things, to retroactively pay the furloughed employees. Thus, while the shutdown may have affected the timing of the receipt of ISDEAA funding, the CR provides for retroactive funding from the beginning of the fiscal year.
Anomalies. The CR contains anomalies (provisions that do not adhere to FY 2013 funding levels and/or conditions) including:
• $600 million increase for Forest Service firefighting
• $36 million increase for Interior Department firefighting ($15 million would be allocated for burned-area rehabilitation)
• $2.5 billion for the Veterans Benefit disability claims processing
• $470 million in additional budget authority for Social Security disability reviews
• $1 billion for federal court Defender Services
• Extension through the 2015-2016 school year of the provision allowing teachers in alternative certification programs to be considered “highly qualified” under federal law
House-Senate Budget Conference Committee
The Budget conference committee is to be co-chaired by Senate Budget Committee Chair Murray (D-WA) and House Budget Committee Chair Ryan (R-WI). The conference committee is charged with completing a conference report by December 13 which will propose topline discretionary spending levels for FY 2014 and may include a framework for a tax overhaul and entitlement reforms which may serve as an alternative to the new sequester cuts which are set to take effect January 15, 2014. Currently, there is a nearly $91 billion difference between the House and Senate budget resolutions (H. Con. Res. 25 and S. Con. Res. 8, respectively). One restriction that Members in the House and Senate agreed to is that the committee is barred from including an increase in the debt ceiling in any agreement that they put forward.
House conferees are Representatives: Cole (R-OK); Price (R-GA); and Black (R-TN) (all members of the House Budget Committee) and Representatives: Clyburn (D-SC); Van Hollen (D-MD); and Lowey (D-NY). Clyburn is the Assistant Minority Leader, Van Hollen is the Ranking Member on the House Budget Committee, and Lowey is the Ranking Member on the House Appropriations Committee. Senate conferees are all members of the Senate Budget Committee: Ranking Member Sessions (R-AL) and Senators: Wyden (D-OR); Nelson (D-FL); Stabenow (D-MI); Sanders (I-VT); Whitehouse (D-RI); Warner (D-VA); Merkley (D-OR); Coons (D-DE); Baldwin (D-WI); Kaine (D-VA); King (I-ME); Grassley (R-IA); Enzi (R-WY); Crapo (R-ID); Graham (R-SC); Portman (R-OH); Toomey (R-PA); Johnson (R-WI); Ayotte (R-NH); Wicker (R-MS).
While Co-Chairs Murray and Ryan as well as Senator Sessions and Representative Van Hollen have held an initial, informal meeting, we understand that the conference committee plans to formally convene the week of October 28, 2013.
Please let us know if we may provide additional information regarding the Continuing Appropriations Act, 2014.
