House Republicans Mired in Budget Battles

The release of House Budget Chair Tom Price’s (R-GA) FY17 budget resolution, originally expected the week of February 22, was delayed due to significant disagreements among House Republican legislators. Conservatives are pushing House leadership to offset the cost of the $30 billion in spending cap relief for FY17. It is now unclear whether a House FY17 budget resolution will be produced at all this year and how appropriations bills will be affected.

Opponents to an additional $30 billion offset for sequester spending cap relief note that the “Bipartisan Budget Act of 2015” already offset the cost of its $80 billion spending cap relief ($50 billion for FY16 and $30 billion for FY17). In addition, even if $30 billion more in offsets were identified, reaching agreement on them would be quite difficult and likely would delay consideration of the FY17 appropriations bills, something House and Senate leadership are loathe to do.

Joel Friedman, Vice President for Federal Fiscal Policy for the Center on Budget and Policy Priorities, wrote in a February 25 blog that Congressional policymakers “essentially offset the cost of the sequestration relief with $80 billion of savings, based on Congressional Budget Office estimates.”  Mr. Friedman continues: “The savings accrue over ten years, and some of the offsets produce permanent savings further into the future. That’s good.  Because the funding increases are limited to 2016 and 2017, the deal would increase deficits early on but reduce them in later years - focusing more deficit reduction over the long run, where our most stubborn fiscal challenges lie.”  Members of the ultra-conservative House Freedom Caucus want another $30 billion in savings, all in mandatory spending, and they want the savings accounted for in FY17.

The delay of the House budget resolution could be a temporary hold-up or portend real difficulties producing any budget resolution in the House this year. The House does not have to pass a budget resolution for appropriations bills to be written because the “Bipartisan Budget Act of 2015” already established top-line spending caps for FY17. Appropriators have made clear that their FY17 spending bills will not be the vehicle for the $30 billion cuts, but appropriations bills could be held up if the House tries to pass stand-alone mandatory spending cuts before they consider appropriations bills.

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