GM 17-021

Update on Status of FY 2017 Appropriations; Current Funding Expires Midnight April 28, 2017

Congress adjourned today for a two week break, leaving in limbo the status of FY 2017 funding for federal agencies which is set to expire midnight of April 28, 2017. Congress reconvenes April 24, leaving four days to reach a final agreement, for the legislation to pass the House and Senate, and to be sent to and signed by the President in order to avoid a partial government shutdown. The only FY 2017 appropriations bill enacted thus far is the Military Construction/Veterans Administration bill; thus the agreement would cover all other federal agencies.

Federal agencies (other than Military Construction/VA) are being funded under a Continuing Resolution (CR) which provides funding primarily at pro rata FY 2016 levels and conditions. Given that there are only five months left in the fiscal year, there is some limitation on the changes that can effectively be made at this point in time. It has been 21 years (1996) since Congress did not need to rely on at least some form of CR to keep federal agencies funded.

Up in the air is whether final FY 2017 funding will be provided through yet another CR at FY 2016 levels and conditions, an omnibus appropriations bill which reflects some of the FY 2017 Appropriations Committee recommendations, or a hybrid of these approaches. Even a CR which extends through the remaining five months of the fiscal year could contain a limited number of “anomalies” (funding levels which differ from the FY 2016 amounts).

We understand that there have been productive behind-the-scenes negotiations on FY 2017 appropriations bills in an effort to reach agreement on legislation which would reflect some of the changes recommended by the House and Senate Appropriations Committees, rather than to only continue funding at FY 2016 levels and conditions. For instance, the House Appropriations Committee has recommended increases for the Indian Health Service (IHS) in the areas of built-in costs, Purchased/Referred Care and Urban Indian Health while the Senate Committee has proposed more funding for IHS behavioral health. For the Bureau of Indian Education (BIE), FY 2016 represented an important step forward in terms of Congress providing full funding for Tribal Grant Support Costs along with substantial increases for School Construction and School Facilities Operations and Maintenance. For FY 2017, the House and Senate Appropriations Committees have proposed further increases for Tribal Grant Support Costs and School Facilities Operations and Maintenance while the House Appropriations Committee has also proposed an increase for Indian School Equalization Program (ISEP) formula funds, the primary funding source for educational programs at BIE-funded K-12 schools.
As of this writing, we understand that some unresolved issues remain. An apparent pitfall – and one that could result in at least a short-term government shutdown due to opposition from Democrats – is the Administration’s 11th hour proposal to increase FY 2017 defense spending by $30 billion and provide $3 billion for initial work on construction of a wall on our southern border. The Trump Administration proposal to partially offset the defense spending proposal is to reduce domestic discretionary spending by $18 billion – a proposal that is opposed by members of both parties.

Meanwhile, the Trump Administration is expected to release its detailed proposed
FY 2018 budget in mid-May. We reported in our General Memorandum 17-020 (March 23, 2017) on their proposed FY 2018 “skinny” budget. The House Appropriations Subcommittee on Interior, Environment and Related Agencies has said they would like to have an FY 2018 hearing for public witnesses on Indian programs under its jurisdiction but thus far no date has been set.

We will continue to follow and report on FY 2017 and other appropriations matters.
Please let us know if we may provide additional information or assistance.