By Erlinda A. Doherty
The Office of Management and Budget released a portion of the president’s $4.7 trillion fiscal year (FY) 2020 budget request, which calls for a 9 percent reduction in discretionary spending for nondefense activities, but an increase of 5 percent, or $33.4 billion over FY 2019 levels for defense spending.
The proposal imposes its own budget “caps” through the reductions—essentially abiding by restrictions of the 2011 Budget Control Act—but ultimately circumvents the limits through cap-exempt Overseas Contingency Operations (OCO) funding increases.
With the goal of achieving a balanced budget in 15 years, President Donald Trump requests $718 billion for the Pentagon, made up of $553 billion in base dollars and $165 billion in OCO funding. The proposal also includes $8.6 billion for border wall funding, reduced Medicare spending of $850 billion from drug cost savings, and major reform of Medicaid expected to generate $241 billion in savings over 10 years.
While the Departments of Commerce (DOC), Homeland Security (DHS), Treasury, and Veteran Affairs (VA) are slated for funding increases, those experiencing the most drastic reductions include the departments of Agriculture (USDA), Education (ED), Energy (DOE), Health and Human Services (HHS), State, Transportation (DOT) and the Environmental Protection Agency (EPA).
The president’s budget is the first step in what is expected to be a protracted appropriations process. The House and Senate have criticized his proposal arguing in favor of a deal raising caps for both defense and non-defense spending. But with uncertainty surrounding those negotiations appropriators are poised to produce spending bills under their own top-line budget figures. The expiring debt ceiling must also be addressed as currently the Treasury is working under “extraordinary measures” to avoid default through FY 2019.
As a result of the piecemeal budget rollout, agency-specific supplemental charts will not be released until next week.
View the Federal Funds Information for States (FFIS) table that compares the president’s proposal to FY 2018-2019 funding levels for Major Discretionary and Mandatory Programs.
See NCSL’s summary of select agency funding highlights.
Erlinda A. Doherty is the Budgets and Revenue Committee director in NCSL's Washington, D.C., office..