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Budget Deal Passes Congress

December 20, 2013

On Wednesday, the Senate passed the Bipartisan Budget Act and the president is expected to sign it into law. The legislation, which was negotiated between House and Senate Budget Committee Chairmen Paul Ryan (R-WI) and Patty Murray (D-WA), aims to ease sequester cuts for two years--$40 billion in the first year and $23 billion in the second year, evenly split between defense and non-defense programs. The law sets overall discretionary spending for the current fiscal year (FY 2014) at $1.012 trillion--about halfway between the Senate budget level of $1.058 trillion and the House budget level of $967 billion. In comparison, in 2014, the nondefense discretionary funds sequester cut under current law is $36.6 billion, and in 2015 it is $36.9 billion. Under the agreement, this would be reduced to $14.2 billion in 2014 and $27.5 billion in 2015, but which programs would see relief from the lower sequester number remains unknown until the appropriations process plays out. The agreement also sets nondefense discretionary spending at $491.8 billion. Additionally, the sequester relief is fully offset by savings elsewhere in the budget, and the deal includes specific deficit-reduction provisions and aims to reduce the deficit by roughly $23 billion. You can read the summary, the bill text, and a section-by-section breakdown. It may also be important to note that this is the first bipartisan budget agreement from a divided Congress since 1986.

While there is $22.4 billion in sequester relief in non-defense discretionary programs in FY 2014, it is not yet clear if such relief will apply to all programs. There is nothing in the law that states the sequester relief funds shall be applied to all programs, so the reality remains that public health programs may continue to see full sequester cuts. We will not know how this relief will be applied until we see spending allocations granted to the appropriations subcommittees. Subcommittees have received these allocations, but this information has not been made public. Additionally, it is also unclear if the appropriators will write a Labor, Health and Human Services appropriations bill. We are again waiting to see what action comes out of the Appropriations Committee to determine whether or not a Labor-HHS bill will be included in the development of an omnibus spending package, or if the bill will simply be a full-year continuing resolution (CR). ASTHO Government Relations staff will continue to monitor the process and will update as necessary.

If you have any questions, please contact Chris Gould on ASTHO's staff