The House Appropriations Committee officially kicked off the FY2019 appropriations season with two subcommittee markups this week. They began with two of the least controversial of the 12 annual spending bills – Military Construction-Veterans Affairs and Legislative Branch.

Military Construction-Veterans Affairs (MilCon-VA)

The $96.9B FY19 MilCon-VA spending bill is $4.2B above the FY18 enacted level and includes $921.4M in Overseas Contingency Operations (OCO) funding. The Department of Veterans Affairs received an increase of $3.9B in discretionary funds over the FY18 enacted level while military construction received an increase of $412M. The bill does not include the Administration’s request for an additional $1.9B for the Veterans Choice Program.

The bill includes some oversight provisions requiring reporting on the status of VA claims processing, requiring an ongoing GAO review of the development of the VA electronic health record, requiring quarterly VA reporting and Committee investigative staff review of the conversion of the VA financial management system, requiring quarterly briefings on large construction projects that are managed outside of VA, limiting funding transfers between construction projects, limiting changes in the scope of construction projects, and restricting certain spending actions without notification to Congress.

And while the bill is one of the least controversial of the spending bills, MilCon-VA appropriations subcommittee ranking member Debbie Wasserman Schultz (D-FL) protested the inclusion of a $69M provision to build a new prison for “high-value” terrorist suspects at Guantanamo Bay. Democrats want to shut down the prison. Forty-one terrorist suspects remain at the facility.

Legislative Branch

The $3.8B FY19 Legislative Branch spending bill is $132M above the FY18 enacted level. This excludes the Senate-only items, which, by tradition, is added later by the Senate.

The bill includes $1.2B to fund the operations of the House (an increase of $32M above FY18), $456.4M for the Capitol Police (an increase of $29.9M), $5.4M for the Office of Compliance, $642M for the Architect of the Capitol (an increase of $31.5M), $709.8M for the Library of Congress (an increase of $40M), $579M for the Government Accountability Office (same as FY18), $117M for the Government Publishing Office (same as FY18), and $5.6M for the Open World Leadership Center (same as FY18).

When the House returns the week of May 7, the Energy & Water Subcommittee will mark up its FY19 spending bill on Monday, May 7 at 5:30 pm. The Transportation-HUD Subcommittee is expected to hold its markup during the week of May 16. And while the spending season has begun, don’t expect it to be finished before the start of the new fiscal year on October 1.

House Military Construction-Veterans Affairs Bill

https://docs.house.gov/meetings/AP/AP18/20180426/108246/BILLS-115HR-SC-AP-FY2019-MilCon-SubcommitteeDraft.pdf

House Military Construction-Veterans Affairs Press Release

https://appropriations.house.gov/news/documentsingle.aspx?DocumentID=395270

Legislative Branch Bill

https://docs.house.gov/meetings/AP/AP24/20180426/108247/BILLS-115–AP–LegBranch.pdf

Legislative Branch Press Release

https://appropriations.house.gov/news/documentsingle.aspx?DocumentID=395271

Newly appointed Senate Appropriations Committee Chairman Richard Shelby (R-AL) said that he would like to return to “regular order” with the FY2019 appropriations bills. Senate appropriators are preparing to mark up their bills in May so that they can have some of them on the Senate floor in June, and then have three or four bills in conference before September. Shelby’s goal is to avoid another end-of-year omnibus, which President Trump has said he wouldn’t accept again.

The mid-term elections and the limited time available on the Senate floor for consideration, however, could lead to bills being packaged into smaller minibuses. Shelby is meeting with House Appropriations Committee Chairman Rodney Frelinghuysen (R-NJ) this week to discuss FY19 subcommittee allocations.

The House will begin marking up their spending bills on April 26 with the Military Construction-Veterans Affairs bill. Defense Appropriations Subcommittee Chairwoman Kay Granger (R-TX) said her bill would be marked up in the “middle of June.” Full committee markups in the House will begin May 8. The House hopes to have all of their FY19 spending bills done by mid-June or July. They are considering a strategy of bundling their bills into minibuses to speed their approval. House leadership is looking to the Senate for guidance on what they can get through their chamber, and that will drive in large part the strategy they employ in the House.

The White House is still considering cutting funds from the recently negotiated and enacted FY2018 omnibus appropriations bill despite warnings from several Democrats and Republicans in Congress that it could “poison the well” for future negotiations. Office of Management and Budget Director Mick Mulvaney is taking the lead on developing a rollback proposal that could cut anywhere from $30B – $60B. The White House expects to submit its proposal to Congress sometime around May 1. The House could take up the measure, but it isn’t clear if they would have the votes for passage. What is clear though is that it wouldn’t stand a chance of passage in the Senate.

Republican leaders in Congress instead are considering drafting a spending cuts package that would avoid the FY18 omnibus, which could help them win broader support. Leadership is looking for unexpended balances to include in the package that would not affect funding included in the FY18 omnibus. President Trump may not be satisfied with this approach though.

President Trump and Republican Congressional leaders are considering using a budget rescissions process to rollback some of the funding that was approved in the FY18 omnibus spending bill. However, reaction to this proposal has been tepid among some Republicans. They are looking to House Speaker Paul D. Ryan (R-WI) for guidance, but the Speaker has not made any public comments on the proposal.

The Congressional Budget and Impoundment Control Act of 1974 provides an expedited process for the President to propose and Congress to review a rescissions package identifying appropriations that the administration does not want to spend. The President must first submit a message to Congress specifying the amount of funds they want to rescind from which accounts and programs along with estimated fiscal and program effects and the reasons for the rescission. Congress would then have 45 legislative days to approve all or part of the President’s request. A rescissions package could pass the Senate with a simple majority vote.

After signing the FY18 omnibus, President Trump called on Congress to give him line-item veto authority on spending bills. The Supreme Court has declared the line item veto unconstitutional. This rescissions process could be a way around that, but he would need Congressional approval.

Republicans hold a slim 50-49 majority in the Senate, which will be 51-49 when Cindy Hyde-Smith is sworn in on Monday. With Sen. McCain (R-AZ) not voting, they can’t lose any Republicans in order to pass a rescissions package. And they may be reluctant to open up that can of worms given the effect it would have on negotiating future bipartisan spending deals.