Appropriations Update and Continuing Resolutions

Matt Glassman | March 2, 2022

Where are we with government funding?   It’s déjà vu all over again, as Congress passes another Continuing Resolution (CR).  The FY2022 congressional appropriations process—which will provide funding for the federal government from October 1, 2021 until September 30, 2022—is once again delaying final action. After its failure to enact full year appropriations bills by October 1, Congress has passed a series of continuing resolutions   (the first through December 3; a second through February 22) to keep the government operating on a temporary basis. Bowing to reality, a third continuing resolution was passed last month, and will keep the government operating through March 11.  The appropriations state of play is best understood via the historical context, Senate hurdles, calendar challenges, the legislative priorities that came first, and finally a deeper dive in those two very familiar letters: the CR.

Historical context:

While the annual appropriations process is rarely completed on time—it has been more than 25 years since all 12 regular appropriations acts were signed into law by October 1—the process this year has been slower than typical.  Only nine of the twelve regular appropriations bills made it to the floor of the House, and none have been considered on the Senate floor. Since FY2010, only four appropriations seasons have dragged into March on continuing resolutions.  And while congressional leaders appear to have agreed on a “framework” for top-line numbers in the inevitable omnibus, the details of the framework remain murky. Numerous policy riders also remain up in the air, to be negotiated between now and the deadline.

Senate hurdles:

One explanation for the slow-going is pretty obvious. Appropriations bills are subject to debate in the Senate, and thus require 60 votes to end a filibuster by the minority. Given the certainty of such a filibuster on partisan bills, Democratic leaders have no choice but to negotiate the terms of the bills with the Republicans, who in turn can seek to use their leverage to pull the bills further toward their positions.  A further complication this year is the evenly-divided Senate power-sharing agreement; with an even number of Republicans and Democrats, the Senate Appropriations Committee cannot simply report out Democratic bills.

Calendar challenges:

The political calendar has also caused complications.  As with almost all first-year administrations, President Biden’s budget was not released in early February, but instead was delayed until the end of May. The expiration of the Budget Control Act also meant no statutory spending caps were in place, leaving appropriators without guidance on topline numbers. Since a budget resolution could not be moved until negotiations over reconciliation instructions were finalized, a “deeming” resolution was passed in the House in June, but Senate Budget didn’t file a 302(a) allocation until September.

Other bills came first:

Finally, legislative priorities pointed both parties away from the appropriations process. The Democrats focused their legislative energy throughout the year on the Biden administration’s big items: initially the American Rescue Plan Act in January and February, and then the Infrastructure Investment and Jobs Act (the  “bipartisan infrastructure bill”) and the administration’s Build Back Better reconciliation bill beginning in the summer. For their part, Republicans have had little incentive to focus on FY22 appropriations. Any continuing resolutions keep in place FY21 appropriations levels, which were negotiated and finalized with President Trump still in office. Many Republican members would probably prefer a year-long continuing resolution to an FY22 set of bills negotiated against the proposed Biden administration budget.

A budget patch with problems: CRs

The problems that continuing resolutions pose to executive-branch functioning are well known. They create uncertainty in the budget execution process, force the execution of funds into compressed time periods once appropriated, require contracts to be rewritten, wreck schedules for both new starts and ongoing programs, making recruiting and hiring employees more difficult , and lack the specificity (especially for Defense funding) that usually accompanies regular appropriations acts. As Secretary of Defense James Mattis wrote in 2017 that a continuing resolution is “disruptive and detrimental” and “manifests in impacts on training, readiness and maintenance, personnel, and contracting.”

Continuing resolutions also affect operations in the legislative branch. First, Congress relies on annual appropriations for its funding just like the executive branch, meaning all the budgeting and execution issues are the same. Continuing resolutions also prove problematic for the legislative process. Delaying final FY22 numbers until well into spring 2022 means Congress either gets a delayed FY23 budget request from the administration, agency budget documents that don’t reflect reality, or both. Which in turn makes it tougher for appropriations staff to properly vet requests, conduct oversight, and produce individual bills. In effect, continuing resolutions and omnibus legislation beget continuing resolutions and omnibus legislation.

Looking ahead: not the worst case scenario:

Here is a bit of good news in all the chaos. As with any appropriations deadline, there is the possibility of a government shutdown if Congress does not produce either an omnibus appropriations bill or another continuing resolution by March 11. Such a shutdown, however, seems unlikely. Almost all past shutdowns of more than a few days have been driven by a party (or a faction of a party) desiring a shutdown for political reasons. Currently, such a faction does not appear to exist. Democrats, with unified control, are presumably wary of being blamed for any shutdown. Republicans, sensing the 2022 political winds in their favor, are unlikely to want to create a situation as politically unpredictable as a shutdown. But neither of these precludes the possibility of a full year continuing resolution similar to what happened in 2007.

Matt Glassman is a Senior Fellow at the Government Affairs Institute


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