Federal Relations

CR Defeated in House

Yesterday, the House of Representatives failed to approve a continuing resolution (CR) that would fund federal government beyond September 30th – the end of the federal fiscal year.  That CR would have extended funding at current levels through November 18th.

Two issues caused the defeat of the bill.  First, the failed CR would have set the total annual spending level for the first seven weeks of FY12 at an annualized rate of $1.043 trillion, in accordance with the debt limit law approved in early August.  This is higher than the $1.019 trillion budget that the House adopted in April, which caused concerns for many House Republicans who want to see greater reductions in government spending.  The second contentious issue has to do with how to pay for disaster funding for states hit hard by Hurricane Irene and tornados.  The House bill would have provided $1 billion in FY11 money for the nation’s Disaster Relief Fund, offsetting that amount with a $1.5 billion cut in an energy-efficient auto program.  The CR also would have provided $2.65 billion in FY12 disaster spending.  Senate Democrats prefer a measure sponsored by Majority Leader Reid (D-NV) that would provide $500 million in FY11 disaster aid, without offsets, and $6.9 billion for FY12.  Disaster funding legislation has traditionally been approved without offsets.

With both chambers set for recess next week, a deal must be struck quickly to avoid a government shutdown when the new fiscal year begins October 1st.  Late last night, the House Rules Committee approved a same-day measure that could allow the House to consider a revised version of the CR as soon as this afternoon.  There is some speculation that House leaders will pare spending levels CR as a way to attract additional support from conservative lawmakers.  However, Senate Democrats have taken a tough stand on that issue and say they will not agree to any CR that would alter spending levels set in the August debt agreement.  

We should learn more as the day goes on.