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Mid-Year Appropriations Update

The appropriations process hit its long-anticipated brick wall last Thursday, as Democrats voted to block, 50-45, the $567 billion Defense spending bill from being considered on the Senate floor.  The move to consider the Defense spending bill as the first appropriations measure on the floor was part of a strategy formulated by Senate GOP Leader Mitch McConnell (R-KY) to put Democrats in the politically awkward position of choosing between a new budget agreement and the military. Senate Democrats continue to say that they want a negotiated budget to replace the spending cuts to national defense and domestic investments known as sequestration. Meanwhile, the White House threatened a veto of the bill should it reach the president’s desk.

Now that the appropriations process has reached its expected impasse, it might be a good time to start talking about the shape of a budget deal. Many hope to see something similar to the two-year deal brokered by Senator Patty Murray (D-WA) and Congressman Paul Ryan (R-WI). The advantage of this type of deal would help avoid another budget battle in 2016, when lawmakers will be campaigning. It also would allow the next Congress to negotiate the future sequester with a new president. Or they could try a fallback one-year deal.

Another option would be to approve a series of stopgap funding measures or a long-term continuing resolution that would stretch current FY2015 spending levels and policy priorities into next year. Such a deal may be undesirable for many, since it would provide agencies with little flexibility and would allocate less base funding for defense and domestic programs than the current appropriations bills. But the worse case scenario would be another government shutdown. No one wants it but everyone thinks they have the upper hand, including tea party conservatives, GOP leaders, defense hawks, and Senate Democrats.

Regardless of the bleak outlook for FY2016 appropriations, several bills continue to move through the process. The House has passed six of the twelve annual spending bills, including Commerce-Justice-Science, Defense, Energy-Water, Legislative Branch, Military Construction-VA, and Transportation-HUD. Interior-Environment is the seventh on the docket and will be considered this week. Three more bills have been reported out of committee and are ready for floor consideration: Financial Services, Interior-Environment and State-Foreign Operations. Homeland Security is the last of the twelve bills to be considered and has yet to get a subcommittee markup. Seven bills made it through the House last year before the process ground to a halt.

In the Senate, six spending bills have been reported out of committee: Defense, Energy-Water, Commerce-Justice-Science, Homeland Security, Interior-Environment, and Legislative Branch. Defense was the lone attempt to bring a bill to the Senate floor, though Republicans might give it another try in the near future to see if they can break the Democrats resolve to block spending bills.