Could another federal government shutdown be on the way this month? Nobody seems to want that to happen, but nobody can rule it out, either. The federal fiscal year started October 1. But because Congress failed to pass a fiscal year 2020 budget, the federal government is currently operating under a continuing resolution (CR), a short-term agreement that maintains spending levels at the 2019 level.
This resolution expires on November 21, so in theory lawmakers have until then to pass an actual budget. If not, lawmakers could pass another CR, or there could be another government shutdown, especially since the impeachment process is moving forward at the same time as the budget talks. Here is a look at some of the many hurdles in the federal budget process.
Early in the year, the agencies and departments of the executive branch submit their budget proposals to the White House. The administration then uses those proposals to draft a budget, and it sends that budget proposal to Congress, usually by the first Monday of February. This is mostly a procedural step, however.
“Historically, presidents’ budgets have been dead on arrival,” then-Chairman of the Senate Finance Committee Charles Grassley noted in 2001. “In our system, the president proposes and the Congress disposes.” That remains true some two decades later.
The next step is supposed to be for Congress to pass a budget resolution. Each House can hold hearings and question administration officials about their budget requests. By mid-April, both Houses are supposed to have passed “concurrent” resolutions, which are not legally binding but do express the will of the Congress. These resolutions form a broad outline, explaining how much money the federal government is expected to raise in taxes and how much it plans to spend. Budget resolutions also serve as a high-level guide to appropriators, who are tasked with setting spending levels for specific programs and agencies.
However, lawmakers can skip the budget resolution step, which is what they did this year. In that case, the most recent budget resolution from a previous year remains in place, and lawmakers may move directly to considering budget bills.
Instead of passing an entire discretionary budget, lawmakers break it down into 12 different spending bills, each of which must pass in the House and the Senate. This allows particular committees in each house to hold hearings and discuss spending priorities. They then send the 12 bills to the floor for consideration.
Lawmakers often combine several of the spending measures into a single “omnibus” bill. For example, this summer the House rolled together five bills that would cover Commerce, Justice, Science, Military Construction, Veterans Affairs, Agriculture, Transportation/HUD and Interior/Environment spending. In fact, the House already passed 10 of the 12 measures it needs to deal with. The Senate has passed four of the 12.
The Senate’s delay was partially because lawmakers weren’t sure how much they’d be allowed to spend. Over the summer, President Donald Trump signed a bill that lifted the debt ceiling and set discretionary spending at about $1.37 trillion for 2020. The Senate has been moving ahead with that limit in mind.
Of course, all this debate is only over discretionary spending, the portion that’s actually allocated by Congress every year. Almost two thirds of federal spending is mandatory, primarily on programs such as Social Security and Medicare. Such spending is expected to account for $2.841 trillion in this fiscal year, and no lawmaker ever votes on it. It’s automatic.
Finally, it’s worth noting that the government shutdown that stretched from last December into January was only a partial one. That’s because lawmakers approved seven of the 12 necessary spending bills last autumn. Something similar could happen again if the Senate approves only some of the House measures.
Still, any shutdown is disruptive, and indicates that the budget process isn’t operating smoothly. As Senate Majority Leader Mitch McConnell put it last year, “I don’t like shutdowns. I don’t think they work for anybody, and I hope they will be avoided.” Time will tell.
Rich Tucker is Director of Public Policy Communications at NAIOP, where he develops and executes communication strategies to raise the visibility of NAIOP’s advocacy work on behalf of the industry