Yesterday, the House of Representatives cleared H.R. 3, the Spending Cuts to Expired and Unnecessary Programs Act, by a vote of 210-206. Requested by the White House on May 8th using the presidential rescission authority under the 1974 Congressional Budget and Impoundment Control Act, the approximately $14.7 billion package of spending cuts, introduced and shepherded by House Majority Leader Kevin McCarthy (R-CA), derive from unspent agency funds.
Under the 1974 budget law, the president can submit a formal rescissions proposal to Congress, for Congress to then consider the requested cancellation of spending under expedited procedures, including a simple majority vote in the Senate (51 vote threshold instead of the usual 60 needed votes). If Congress fails to act on the White House’s proposal within 45 continuous congressional session days (not counting days whether either chamber is in recess for more than three days), then the president must spend the money, and cannot re-propose the same recessions. However, if both chambers approve the spending cut proposal, the funding is then rescinded, with the funds going to general deficit reduction purposes. The last presidential rescissions package was formally sent to Congress in 2000.
Specifically, H.R. 3 provides for the cancellation of previously-congressionally approved spending from 34 accounts, including the rescission of unobligated balances from prior years, and reductions to certain budget authority for mandatory programs. The measure does not rescind any of the funding provided by the Fiscal Year (FY) 2018 omnibus enacted in March, but was crafted in reaction to deficit concerns in the White House and among certain members of Congress following enactment of both the FY 2018 omnibus and tax code changes in December. The Congressional Budget Office has estimated that while $14.7 billion in budget authority would be rescinded, only $1.1 billion in actual spending (outlays) would be reduced over the next ten years. Rescission areas include the Department of Energy’s Advanced Technology Vehicles Manufacturing Loan Program and Innovative Technology Loan Guarantees, as well as the Department of Health and Human Services’ nonrecurring expenses fund for various administrative expenses such as facilities, information technology, and other acquisition projects.
The measure faces an uphill future in the Senate, with Senate Majority Leader Mitch McConnell (R-KY) publicly stating it “is going to be very difficult” to advance the legislation in the Senate chamber. Senator Mike Lee (R-UT) filed a similar spending cuts measure, S. 2979, last month. The Senate has until June 22 before the procedural protections (lower vote threshold) expires.
The White House has made H.R. 3 a top legislative priority, and has indicated it is interested in additional rescission proposals, though there is already bipartisan pushback from Congress regarding targeting previously provided spending, including for funds contained in the recently enacted FY 2018 omnibus, as well as expressions of concern that it is the legislative branch, and not the executive, that is responsible for determining funding. Additionally, there are also concerns over the plan for FY 2019, which begins on October 1st, as the White House has stated it is open to a government shutdown if Congress does not provide certain funding priorities.
I will keep you updated on these funding developments, which continue to make it difficult for the orderly operation of agency functions, as well as for you and other federal employees, who are simply trying to do the jobs you were hired to do.