Congress Poised to Complete Fiscal Year 11 Appropriations
Last night the House of Representatives filed HR 1473, the Full Year Continuing Resolution for FY 11. This bill, which will be considered by the House on Wednesday and by Senate on Thursday, completes action on appropriations for FY 11. With enactment of the current year spending Congress will immediately turn to the FY 12 appropriations process.
The bill cuts $38.5 billion from the FY 10 rate of domestic discretionary spending. This amount is $78.5 billion less than the FY 11 budget and more three-quarters of the way to the House Republican goal of cutting $100 billion. That additional $22 billion, or a little more, is contained in separate legislation – the House Budget Resolution for next fiscal year – FY 12 -- that is on the House floor today.
The attached chart contains a summary of spending decisions made in the bill for rural housing and other housing and community development programs. While there are few eliminations – HUD’s Rural Innovation’s Fund is one -- there are plenty of reductions.
In general, rural housing programs were held at program level freeze and fared better than many other programs. The increase in fees on section 502 guarantees was an important factor in appropriations committee decision making. Based on FY 10 spending, the many short term continuing resolutions passed by Congress carried forward $172 million in budget authority used to support the guarantee. In August, Congress changed the fee structure to make the guarantee a no cost program. However, because it was appropriated in FY 10, the subsidy cost for guaranteed was carried over, but was no longer necessary and therefore available to address cost cutting requirement s of the initial House bill.
Congress, led by the House, increased budget authority to maintain FY 10 rates in the face of higher subsidy costs. Equally important, Congress did not accept any administration recommendations, based on the FY 12 budget. The budget proposed to end most rural housing programs. OMB officials attempted to insert administration proposals throughout final deliberations.
While this is an important victory, the spending debate is far from over. The Administration’s rural housing budget is terrible and, if this CR is any guide, they are working at it. At least in the House, an additional $20 billion or more in spending cuts is on the way. However, for the moment – from April 16 when the final CR takes effect through September 30 – there is still a rural housing program.