Stephen Boyd’s Capitol Hill briefing for Alabama’s business, financial, defense and government affairs executives.
Arduous Appropriations Process May Finally Be Near Resolution Just as New Federal Funding Cycle Begins
The Schedule. The House of Representatives and the Senate are each scheduled to be in legislative session this week and next ahead of a two-week congressional recess that brackets the Easter holiday. Driving this legislative period is a major government spending deadline that looms on March 22, the last workday of the month.
Light at the End of the Tunnel for FY24 Spending Bills? The tortured saga of the Fiscal Year 2024 spending cycle continues to be a drag on a Congress that is, unbelievably, still working to finalize spending that should have been in place 163 days ago.
Perhaps an end is finally in sight. To make sense of the end game, here’s a summary of a confusing process that may eventually allocate $1.66 trillion in federal funding.
Since last October, the government has operated on a series of necessary but undesirable short-term, stop-gap Continuing Resolutions. The CRs prevent a government shutdown (good) but tie the hands of government managers seeking to allocate new funds to meet evolving challenges (bad). That paralysis trickles down to the contractor community as businesses are left in limbo when their government customers lack the ability to execute new contracts for goods and services.
In November, the CR was bifurcated to create two separate deadlines. After some interim extensions, the first of the two deadlines came due last week. For its part, Congress narrowly avoided a partial government shutdown on Friday when the Senate finalized a $459 billion package of six FY24 appropriations bills. That package, which includes half the bills but only about 30 percent of the total discretionary funding needed across the government, included money for federal departments that manage agriculture, housing, veterans’ programs, energy and transportation. President Joe Biden signed the package into law on Saturday.
Though the Senate acted last, much of the holdup had been in the House. There, action was delayed for months due to Republican infighting over which conservative policy riders (i.e., amendments that change the permanent law governing a program funded by the bill) would be attached.
On this, Republican House Speaker Mike Johnson has been in a tough spot from the start. The far right’s wish list is never going to fly in a Democrat-controlled Senate or at the Biden White House. Worse, Johnson’s own caucus’s inability to work together to pass legislation greatly diminishes his leverage in talks with Senate Democrats. Frankly, he can’t do much about those realities.
In the end, the bills contained modest reductions to spending but dropped most of the controversial policy riders. The House passed the package under Suspension of the Rules, a maneuver that circumvents the House rules committee—now influenced by voices on the right—in favor of a direct route to the floor for legislation that can achieve a two-thirds majority vote. The 1,050-page package passed 339-85. More Democrats voted “yes” than Republicans.
The work is not done, and the second deadline—March 22—stands to be a tougher test with all of the same uncomfortable political dynamics in play, but much more spending hanging in the balance. The second set of bills contains funding for two of the big drivers of spending: defense and health and human services—each has powerful vested interests inside and outside of government. The package will also include homeland security funding, which is sure to raise tensions around border security issues.
Final passage is far from guaranteed; expect this process to come down to the wire. Another CR is always possible.
Cuts to the FBI in Huntsville? One of the relatively few “wins” for right-wing hardliners touted in last week’s spending package was a $654 million cut to federal law enforcement. This responds to the dubious argument that overreaching federal law enforcement has turned against the American people. But, in an example of the Republican-on-Republican political sniping that followed, one GOP representative countered that the cut was nothing more than a Potemkin reversal of former Senator Richard Shelby’s earmark to fund the FBI’s second headquarters in Huntsville. For those familiar with annual government funding cycles, that claim didn’t make much sense. Indeed, Alabama Sen. Katie Britt and Rep. Dale Strong each issued statements noting the construction was already funded. Work at the FBI’s new HQ2—it’s a first-class addition to the Redstone Arsenal community—seems on track. The facility will be home to more than 4,000 federal workers.
Israel and Ukraine Funding Languishes. The Biden Administration’s October 2023 request for $76 billion in supplemental funding for Israel and Ukraine continues to tread water as war rages.
In Israel, a semi-brokered cease-fire seems to have fallen apart as Hamas terrorists continue to detain hostages and as disease and famine begin to ravage the Palestinian community. The U.S. is ramping up efforts to provide aid, including new plans to build a temporary port to facilitate the delivery of supplies. Those steps come as the Biden Administration’s support for Israel draws deep divisions in the Democratic Party that could impact the 2024 election. More than 100,000 Democrats in Michigan—home to a large Arab-American population—voted for “uncommitted” during the recent primary.
In Ukraine, more than 355,000 Russian troops have reportedly been killed during the Russian invasion, but limited weapons and ammo are now hindering the Ukrainian resistance. Russian forces have made modest territorial gains.
The Senate passed an aid package in February that awaits House consideration, which is unlikely before April — if at all.
President Biden’s FY25 Budget Release. With last week’s State of the Union address now complete, Congress expects to receive Biden’s Fiscal Year 2025 budget proposal later today. In practice, members and staff have already commenced the initial stages of the FY25 process, but the budget submission marks the official kickoff to a budget and spending cycle that — given the contentious presidential election season ahead — will likely be just as convoluted as the last.
Dysfunction in Congress Driving Member Departures. The 118th Congress stands to be among the least productive in U.S. history. In the last twenty years, each two-year Congress has averaged about 390 enacted laws. The current Congress, which is 60 percent complete, has resulted in just 39 enacted laws. And while it’s true that modern legislating often means combining multiple bills into single laws, the departure from the norm remains eye-opening.
No surprise here: recent Gallup data shows Congressional approval ratings are at a historically low 12%.
More interesting, members themselves may agree. To date, about 10% of House members are choosing to retire or run for another office. (Another seven members have already resigned or died.) There’s always turnover, but beyond the numbers the emerging trend to watch is the type of members stepping away—and why. Four current House committee chairmen have announced an intent to leave, and a fifth has hinted he might—an unusual decision for members who have reached the powerful perch that seniority brings. And a number of departers have directly cited dissatisfaction with congressional infighting as a driving factor. Member morale and productivity is highest when there is a sense of meaningful contribution — substantive debate, productive compromise, and ample voting — that justifies time away from family and friends. Perhaps some are now calculating that a legislature overly focused on political posturing, social media clicks, and performance theatre doesn’t warrant the sacrifice. What does that portend for the country’s future?
Stephen E. Boyd is a Partner at Horizons Global Solutions. Previously, Boyd served as a Senate-confirmed Assistant Attorney General at the U.S. Department of Justice, Chief of Staff for Alabama members in both the U.S. Senate and U.S. House of Representatives, and as a Communications Director of the Senate Committee on the Judiciary. He resides in the Washington, D.C. area. Opinions expressed herein are his own. Contact Stephen at [email protected], via X at @SEBOYD79, or on LinkedIn.