109th Congress

FY 2007 Budget Resolution

S. Con. Res. 83, H. Con. Res. 376, H.R. 5386, H.R. 4939

Background

The annual budget resolution passed by the House and Senate sets annual spending caps for discretionary programs, including the National Institutes of Health (NIH), which determine the amounts available to the House and Senate Appropriations subcommittees as they fund agencies. Since budget resolutions are in the form of concurrent resolutions, these measures do not go to the President after final passage by Congress. However, the budget resolution plays a major role in the overall annual budget process. A budget resolution establishes broad budgetary parameters, and included in the budget blueprint are discretionary spending caps, called 302(a) allocations. The term “302(a) allocations” is derived from section 302(a) of the 1974 Budget Act, which created the House and Senate Budget Committees and set forth the budget process. Once a final budget measure is adopted by Congress and the House and Senate Appropriations Committees know their 302(a) allocations (total discretionary budget authority), the two full Appropriations Committees begin the process of dividing this funding for distribution to their 10 subcommittees. The funding allocated to the 10 subcommittees is commonly called 302(b) allocations, derived from section 302(b) of the 1974 Budget Act. After receiving their 302(b) allocations, the Appropriations subcommittees can begin the process of drafting and reporting their annual spending measures back to the full Appropriations Committees.

When a final budget resolution for fiscal year (FY) 2007 had not passed both chambers by May 15, 2006, the House and Senate moved ahead with consideration of the annual appropriations bills. In 2002, Congress did not agree to a budget resolution for FY 2003. In the absence of a budget resolution, the House agreed to H. Res. 428 (107th Congress) and H. Res. 5 (108th Congress), deeming the House-adopted FY 2003 budget resolution (H. Con. Res. 353, 107th Congress) to have been adopted by Congress for budget enforcement purposes. The Senate did not take similar action.

SENATE ACTION

On March 17, the Senate narrowly passed the FY 2007 budget resolution, S. Con. Res. 83, by a vote of 51 to 49. Although the budget resolution does not bind appropriators to an amendment’s discretionary spending assumptions for specific programs, Senate Labor, Health and Human Services (HHS), Education and Related Agencies Appropriations Subcommittee Chair, Senator Arlen Specter (R-PA), and cosponsor Senator Tom Harkin (D-IA) succeeded in adding $7 billion to the cap on advance appropriations, with the increase aimed at education, health, and labor programs. The Senate budget resolution recommends $29.350 billion for NIH in FY 2007, which is $1 billion over the FY 2006 appropriation and the President’s budget request. The Senate Budget Committee Web site states, “The Chairman’s mark assumes an increase of $1 billion over the President’s request for a total budget of $29.6 billion. This allows NIH spending to keep pace with biomedical inflation.” The Specter-Harkin amendment would provide NIH with a $2-billion increase over the President’s Budget. Even with this increase, the amount is below the amount provided in FY 2005 when adjusted for inflation. The amendment accomplishes this by increasing the cap on FY 2008 advances by $7 billion. These advances can be used in labor and education programs to provide additional FY 2007 funding for priority health and education programs, including NIH, the Centers for Disease Control and Prevention, the Health Resources and Services Administration, vocational education, K–12 and higher education, the Low Income Home Energy Assistance Program, and others.

The amendment raises the cap on advances, but it does not raise the discretionary caps for either FY 2007 or 2008.

HOUSE ACTION

The House resolution, H. Con. Res. 376, had been abandoned by the House leadership on April 6, when it became clear that there were not sufficient votes at that time to pass the measure. An amendment similar to the Specter-Harkin amendment in the Senate (to provide an additional $7 billion for health and education programs, of which $2 billion would be directed to NIH) had been offered in markup of this resolution by Representative Rosa DeLauro (D-CT), but it was defeated by a party-line vote. Representative Michael Castle (R-DE) had planned to offer a floor amendment similar to the DeLauro amendment, although his version would have shifted funds from defense and other programs instead of raising the cap. In the absence of a House-passed budget resolution, the House Appropriations Committee began to move forward using the Budget Committee-reported totals to set allocations for the Appropriations subcommittees, which would have likely left NIH with the President’s Budget level. Under the President’s Budget, the FY 2007 Labor-HHS-Education appropriations bill would face a $4.2-billion reduction from current levels.

However, in the first week of May, the House Appropriations Committee Chair, Representative Jerry Lewis (R-CA), proposed to increase Appropriations subcommittee allocations for nonsecurity domestic spending programs by almost $6 billion over the President’s proposals. That funding shift would be accomplished by taking $4 billion from defense, $2.4 billion from foreign operations, and $824 million from military construction (homeland security would, however, receive $1 billion more). The Labor-HHS-Education bill would receive $4.1 billion more than the President’s Budget to boost the bill’s discretionary spending to $843 million over current levels, although the $4.1 billion would still leave the Labor-HHS-Education measure well below what is needed to fund current services on an inflationary basis.

In the early morning hours of May 18, the House passed H. Con. Res. 376, the FY 2007 House Budget Resolution, by a vote of 218 to 210. Twelve conservative Republicans voted against the bill, joined by all the Democrats. The Republican moderates, including Representative Castle, voted for the resolution. The rule for debate of H. Con. Res. 376 self-executed two provisions into the budget resolution related to the Labor-HHS-Education appropriations bill: 1) a Sense of the House provision “recognizing the need” to increase the Labor-HHS-Education allocation by $7.158 billion above the President’s Budget (but not taking action to achieve that objective) and 2) a “reserve fund” provision that states that if savings are enacted in mandatory programs and if those savings are designated to be used for the Labor-HHS-Education bill, that bill’s allocation can be increased, but not by more than $3.1 billion.

Based on this, the resolution appears to provide an additional $7 billion above the President’s budget request for Labor-HHS-Education ($4 billion of which are slated to be transferred per Committee Chair Lewis and $3.1 billion from the “reserve fund”), while not raising discretionary caps. Differences between the House and Senate resolutions remain; however, this is a positive action for NIH and possibly an opportunity for House appropriators to provide NIH with a budget above the President’s request.

Status and Outlook

The Senate budget resolution, S. Con. Res. 83, was passed by the Senate on March 16, 2006. The FY 2007 House budget resolution, H. Con. Res. 376, was passed by the House on May 18, 2006. Also on May 18, the House deemed the House budget (H. Con. Res. 376) to be in effect by attaching such language to the FY 2007 Interior-Environment appropriations bill (H.R. 5386), on which there was a floor vote. No conference action between the Senate and House is scheduled on these two resolutions, and although it remains highly unlikely that the House and Senate will reach a bicameral deal on their competing budget plans, the House can nonetheless proceed under the spending restrictions of its own blueprint. Senate leaders plan to use the 2006 emergency supplemental spending bill (H.R. 4939) for the conflicts in Iraq and Afghanistan and hurricane recovery to deem an $873-billion FY 2007 discretionary budget cap for the Senate. Without that action, Senate appropriators are operating under the FY 2006 budget resolution (H. Con. Res. 95), which prescribes an $866-billion cap for FY 2007, $7 billion less than the President’s budget request and $23 billion below the amount outlined in the Senate’s FY 2007 budget resolution (S. Con. Res. 83).