Federal Relations

September 23, 2011

Fate of CR Uncertain

Late last night (or early morning, if you want to be more accurate), the House approved a continuing resolution (CR) to keep federal government running past September 30th but the bill faces challenges in the Senate this morning.  Even before passage of the House bill, Senate Majority Leader Reid (D-NV) warned his caucus would block approval in the Senate and instead take the debate into next week when lawmakers had hoped to be on recess for the Jewish New Year, Rosh Hashanah.

Running through November 18th, the House CR keeps faith with the August budget accords, imposing a 1.5 percent across-the-board cut on domestic and defense agencies alike to meet the target of $1.043 trillion for FY12.  But the level of disaster aid, $3.65 billion over the next 13 months, is less than half of what the Senate wants and Republicans have insisted on about $1.6 billion in offsets targeted at Democratic priorities.  The House bill would take $1.5 billion from an advanced technology manufacturing program for the auto industry to pay for a portion of disaster relief.  Additionally, a new $100 million cut was added to the bill late Thursday, rescinding unobligated money in an alternative energy loan fund that helped finance Solyndra LLC, the controversial solar panel manufacturer in California that has filed for bankruptcy protection.

The Senate is poised to reject the House-passed CR this morning, leaving congressional leaders scrambling for a deal to avert a government shutdown at the end of next week.  It is predicted that the Senate will amend the House bill and then pass the package to eliminate $1.5 billion in offsets. This will certainly anger House Republicans and almost guarantees that passage of any CR won’t happen today.  Yesterday, Senate leadership released a statement saying they are ready to stay in Washington next week to “do the work the American people expect us to do and I hope the House Republican leadership will do the same.”

If the House had removed the offsets instead of adding to them in the second CR attempt, Democrats say that would have paved the way for Democratic votes in both chambers to approve the measure.

House Republicans and Senate Democrats have been at odds for more than a week over whether any of the disaster aid should be offset.  The House-passed bill (HR 2608) was largely unchanged from a measure defeated Wednesday in the House by a unified Democratic party and four dozen conservatives seeking to hold the line on spending.  The only major change was the addition of a new $100 million offset rescinding money for the loan program that supported the defunct solar panel maker Solyndra.  House GOP conservatives, who opposed the initial version, said they switched their votes after becoming convinced by party leaders that there was no better option.

The fun will continue this morning in the Senate.  Stay tuned for more…