Deep Dive: Approving Short-Term Government Spending

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Deep Dive: Approving Short-Term Government Spending

This week, the House of Representatives and the Senate will vote on a bill to extend federal government funding until December 20. With government funding set to expire on November 21, failure to do this would result in a partial government shutdown. 

  

A previous Deep Dive examined the budget process that talks about the overall spending blueprint for the federal government. This Deep Dive will discuss the specific part affecting spending – the appropriations process. 

 

 

The Appropriations Process

 

Article I, Section 9, of the U.S. Constitution states: “No money shall be drawn from the Treasury, but in consequence of appropriations made by law.”

 

Federal government spending is divided into two categories:

  • Mandatory: Programs authorized by Congress that operate outside the regular spending process are entitlement programs, and their spending is deemed “mandatory.” For Social Security, Medicare, and Medicaid, anyone who meets certain qualification is entitled to benefits. Funding for these programs does not have to be authorized yearly by Congress, although the eligibility and payment rules can be changed.
  • Discretionary: To pay for other government activities, ranging from military operations undertaken by the Defense Department to operating national parks to paying congressional staff, Congress must pass 12 appropriations, or spending, bills. These bills operate on a fiscal year basis. If they do not become law, funds cannot be drawn from the U.S. Treasury to pay for the government operations they cover.

 

Appropriations Bills

 

The 12 appropriations bills that should be passed by Congress every fiscal year (October 1 through September 30) are:

  • Agriculture
  • Commerce/Justice/Science
  • Defense
  • Energy and Water
  • Financial Services
  • Homeland Security
  • Interior and Environment
  • Labor/Health and Human Services/Education
  • Legislative Branch
  • Military/Veterans
  • State/Foreign Operations
  • Transportation/Urban Development

 

You can see the progress of the Fiscal Year 2020 appropriations bills through Congress here.

 

The number and title of these bills can be changed by Congress. After the 2001 terrorist attacks, Congress re-organized the appropriations process, which at that time had operated with 13 appropriations bills.

 

Consolidated Appropriations/Continuing Appropriations/Omnibus Appropriations

 

While the spending process is supposed to proceed with the 12 bills being passed separately and signed into law by October 1 of each year, this almost never happens. In fact, since 1977 (when the current spending system was put in place), Congress has passed all of the appropriations bills on time in only four years. The last time it did this was 1997. The usual pattern is that Congress passes some, but not all, of the bills to be signed into law by October 1.

 

When this happens, Congress can take a variety of steps to avoid a government shutdown. It can pass a resolution for continuing appropriations, which fund the government for a specified period of time at the level of the previous fiscal year. During this time, it can then pass a consolidated appropriations act, which combines two or more appropriations bills. An omnibus appropriations bill generally wraps all the outstanding appropriations bills into a single act for the rest of the fiscal year.

 

If special spending needs arise during the fiscal year, Congress can also pass a supplemental appropriations bill, which provides funding more money than what was contained in the original spending bill.

 

Fiscal Year 2020

 

To avoid a government shutdown, Congress must pass these 12 spending bills (either in individual or consolidated form) and the president must sign them. So far this year, the House of Representatives has passed 10 bills (with only Homeland Security and Legislative Branch still remaining to be approved). The Senate has passed none. 

 

 

Instead of completing work on the individual spending bills by October 1 (the beginning of the new fiscal year), the House of Representatives and the Senate passed a continuing resolution, a short-term bill that funds the government at the previous fiscal year's level.  This legislation funded the government through November 21. If Congress does not act on another bill, or the president does not sign one, then there would be a partial government shutdown.

 

The 2018-2019 Government Shutdown

 

The last government shutdown occurred from December 2018 to January 2019. The beginnings of this shutdown began a year ago, with the failure of Congress to pass the necessary spending bills. Prior to the beginning of Fiscal Year 2019 (which began on October 1, 2018), Congress had only passed these appropriations bills:

  • Defense
  • Energy and Water
  • Labor/Health and Human Services/Education
  • Legislative Branch
  • Military/Veterans

 

Continuing resolutions funded the government agencies covered by the other appropriations bills through December 21. President Trump signaled his opposition to signing any spending bills that did not contain funding for a wall on the U.S.-Mexican border. As a consequence, the agencies not covered by the already-passed appropriations bills were shut down on that date.

 

The parts of the government that were covered by these spending bills could continue to operate as normal, however. Since the Legislative Branch appropriations bill was signed into law, congressional staffers could continue to be paid their salary. So could employees of the Energy Department, Defense Department, the Labor Department, the Department of Health and Human Services, and the Education Department.

 

When President Trump signed House Joint Resolution 28 on January 25, this reopened the portions of the federal government that were shut down until February 15. The signing of House Joint Resolution 31 by President Trump funds the federal government through the end of Fiscal Year 2019.

 

What This Means for You

 

The two-year budget deal that House Speaker Nancy Pelosi, Senate Majority Leader Mitch McConnell, and President Donald Trump agreed to over the summer was designed to eliminate the possibility of a government shutdown this year or next year. However, there is still disagreement between Republicans and Democrats in Congress over border funding. It appears that the leadership in the House and Senate as well as President Trump have agreed in principle to another short-term funding bill. That legislation, H.R. 3055, is set to be voted on by Congress this week. It will keep the government open until December 20. This gives negotiators more time to come to an agreement that has the possibility of funding the federal government through the end of this current fiscal year, avoiding a partial government shutdown.

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