Capitol to Capitol
An Information Service of NCSL's Standing Committees

Volume 18   Issue 14 - April 19, 2011
 

SIGNED, SEALED, DELIVERED

FY 2011 appropriations have finally concluded, just 197 days into the fiscal year. The spending agreement, H.R. 1473, secured House and Senate approval on Thursday before being signed by the president on April 15. H.R. 1473 cuts nearly $40 billion from FY 2010 appropriations, including reductions to the supplemental nutrition program for woman, infants, and children (WIC), the low-income household energy assistance program (LIHEAP) contingency fund and high speed rail. An analysis by the Federal Funds Assistance for States (FFIS) shows states should expect a 4.1 percent reduction in domestic discretionary federal funding in FY 2011 compared with FY 2010. For more information, please view NCSL’s appropriations summary at http://www.ncsl.org/default.aspx?TabId=22511. (NCSL contacts: Michael Bird, Jeff Hurley)


HOUSE FIRST OUT OF BUDGET RESOLUTION CHUTE

Last Friday the U.S. House of Representatives approved H. Con. Res. 34), a FY 2012 budget resolution and 10-year budget blueprint by Wisconsin Rep. Paul Ryan that shaves future deficits by $4.4 trillion. The legislation cleared the House 235-193 and met the April 15 deadline for budget resolution passage. The resolution calls for more flexibility for states by giving block grants for Medicaid and Food Stamps (SNAP), reducing domestic non-security discretionary spending below FY 2008 levels and converting Medicare into a premium support program in 2022. It would extend 2001 and 2003 tax cuts permanently, institute corporate tax reform and repeal federal health care reform laws. A summary of the “Path to Prosperity” is available at http://www.ncsl.org/default.aspx?TabId=22501. The House handily beat back four alternative budget resolutions offered by Maryland Rep. Chris Van Hollen for the Democratic minority, the Congressional Black Caucus, the Congressional Progressive Caucus and the Republican Study Committee. H.Con. Res. 34’s fate in the Senate seems bleak—but it does provide contrast to and a starting point for negotiations with the Senate budget resolution and the presidential deficit reduction outline released on April 13, 2011 (see story below). (NCSL staff contacts: Michael Bird, Jeff Hurley)


PRESIDENT SUPPLEMENTS EARLIER DEFICIT REDUCTION OFFER

On April 13, President Barack Obama released a 12-page, 12-year deficit reduction outline, moving beyond the recommendations made in his FY 2012 budget. The president calls for reducing the deficit by $4 trillion by putting all revenue and spending issues on the table. He recommends cutting domestic and defense security by a combined $1.2 trillion and imposing a 3:1 spending to revenue ratio for bringing down the deficit. His outline places enforceable triggers on direct spending, including tax expenditures, provides exemptions for low-income programs, Social Security and Medicare , and rejects block grants for Medicaid. The president, instead, supports more flexibility, accountability and efficiency in Medicaid and instituting a countercyclical Medicaid match trigger. His plan cuts $360 billion in mandatory entitlement programs, urges an end to 2001 and 2003 tax cuts for those making more than $250,000, and advocates reforming corporate taxes, reducing tax expenditures and closing tax loopholes. For more information, go to: http://www.whitehouse.gov/the-press-office/2011/04/13/fact-sheet-presidents-framework-shared-prosperity-and-shared-fiscal-resp). The president’s proposal leaves the U.S. Senate as the only player without a leadership- or committee-drafted budget resolution or deficit reduction outline. (NCSL staff contacts: Michael Bird, Jeff Hurley)


SO WHERE IS THE SENATE?

North Dakota Senator Kent Conrad, chairman of the Senate Budget Committee, intends to start drafting his own budget resolution over the two-week congressional recess that began last Friday. He continues to wait for the bipartisan “Gang of Six” to reach consensus on a comprehensive, long-term deficit reduction plan that would track recommendations made by the president’s National Commission on Fiscal Responsibility and Reform. The “Gang of Six” includes Senators Saxby Chambliss (Georgia), Mark Warner (Virginia), Tom Coburn (Oklahoma), Dick Durbin (Illinois), Mike Crapo (Idaho) and Conrad. Over the weekend, Senator Warner indicated the group was “very close.” Senator Coburn stated “nobody is going to like what we come up with … and that’s one thing that would be an indicator that it is probably the best compromise we’re going to be able to get.” Stay tuned. (NCSL staff contacts: Michael Bird, Jeff Hurley)


NCSL ADVANCES ITS DEFICIT REDUCTION PLATFORM

On April 15, NCSL’s leaders met with President Obama, Vice President Joe Biden and key economic and health advisers to discuss unfunded federal mandates, deficit reduction principles, the streamlined sales tax and health care reform. Please see a summary of the meeting and list of participating legislators at http://www.ncsl.org/default.aspx?tabid=22537. The following day, NCSL’s Deficit Reduction Task Force reviewed details of Rep. Ryan’s budget resolution and deficit reduction blueprint with the congressman’s budget staff. (NCSL staff contacts: Michael Bird, Jeff Hurley)


NEXT UP—DEBT CEILING

With a spending agreement finally concluded for FY 2011, raising the nation’s debt limit is the next pressing issue in need of resolution. While Treasury Secretary Timothy Geithner previously stated the nation will reach its $14.29 trillion debt ceiling between mid-May and mid-April, he also mentioned the Department of Treasury could take “extraordinary” measures to delay defaults until July 8. A potential vote to raise the debt limit could include a package of either additional spending cuts or debt reduction plans. To help jumpstart discussions, the president has requested congressional leadership to appoint negotiators to have “budget talks” with the White House. Senate Majority Leader Harry Reid of Nevada has appointed the chairs of the Senate Appropriations and Finance Committees, Senator Daniel Inouye of Hawaii and Senator Max Baucus of Montana, respectively. In the House, House Minority Leader Nancy Pelosi has selected the Budget Committee Ranking Member Chris Van Hollen of Maryland along with James Clyburn of South Carolina. Congressional Republicans have yet to select their negotiators. Stay tuned. (NCSL staff contacts: Michael Bird, Jeff Hurley)


HEALTH FUND REPEALER TO SENATE

Last week the House passed H.R. 1217, one of five consecutively numbered bills repealing various aspects of federal health care reform and/or health mandatory/entitlement spending. H.R. 1217 would repeal the Prevention and Public Health Fund created in the 2010 federal health care reform legislation to support prevention and public health programs in order to curb the growth in health care costs. The legislation passed 236-183. It does not appear to have legs in the Senate. (NCSL staff contacts: Joy Johnson Wilson, Rachel Morgan)


SURFACE TRANSPORTATION REAUTHORIZATION PRINCIPLES UNVEILED

NCSL, governors and county and city officials announced seven principles last week that represent consensus perspectives for reauthorization of surface transportation programs. The principles address funding, safety, program reform and system performance issues. Please go to http://www.ncsl.org/default.aspx?TabId=22525 for additional information. (NCSL staff contacts: Molly Ramsdell, Helen Narvasa)