On April 15, Rep. Mike Michaud (D-ME) and Rep. John Duncan (R-TN) sent a bipartisan letter to House Appropriators asking their support of FY2012 level funding of $257.5 million for EDA in FY2014. The letter also requests full funding for the Public Works program at $111million. The letter included 62 Members of Congress as co-signers. Click here to view the final letter.

The bill also contains a provision blocking the pay of House and Senate members if their respective chambers do not produce a budget resolution, as required by law.  House leaders included this provision because the Senate has failed to adopt a budget resolution for three years.  Budget resolutions, while not carrying the force of law, help both chambers set spending priorities and enable a more predictable and efficient appropriations process.  When the annual spending bills are not completed and the government relies on continuing resolutions, long-term planning for any agency or organization that receives federal funding is extremely difficult.  The Senate has indicated it will pass H.R. 325 and President Obama has indicated that he will sign the legislation. Click here to view the full text of H.R. 325.

Appropriators have made significant progress in working out differences between the House and Senate spending bills and they had hoped several bills could be rolled into a FY2013 spending omnibus. However, passage is unlikely because Congressional leaders are focused on a deal to avoid the fiscal cliff and emergency spending relief for states and communities affected by Hurricane Sandy. The new Congress is likely to focus attention on the FY2014 budget process come January.

According to the memo, “Agencies should continue normal spending and operations” in early fiscal 2013, which officially began on October 1. This message came as part of a document OMB normally issues each year in late September detailing how federal agencies should operate under stopgap continuing resolutions (or “CRs”). However, this year is more complicated as the CR (H. J. Res. 117) signed into law by President Obama last week extends most federal operations for six months, a longer period than most CRs.

In a separate notice issued to agencies on the FY2013 CR, OMB also urged Congress to pass a “balanced package of deficit reduction” so that the automatic, across-the-board cuts built into last year’s debt-limit deal (P.L. 112-25) can be replaced with a more targeted approach to budget cutting. In mid-September, OMB released a report that projected sequester cuts of 9.4 percent to non-exempt defense discretionary spending and 8.2 percent to non-exempt domestic discretionary spending.

Unless Congress acts to avert or postpone the sequester before the January 2 deadline, OMB will need to trigger the actions needed to make $109 billion in cuts for the fiscal 2013 accounts of most federal programs. Both Republicans and Democrats have criticized this method for making cuts, and there have been calls from lawmakers and stakeholder groups across the political spectrum to prevent the sequester.

It remains unclear whether Congress will be able to reach a compromise on the sequester after the November elections. Republicans want to replace the cuts with alternative reductions, and the GOP-led House passed a budget resolution this year that included extensive cuts to domestic spending while eliminating the cuts to the Defense Department that would come under sequester. Democrats want an approach that would include higher tax revenues and alternative cuts to replace the sequester.

The CR reflects the $1.047 trillion cap set for discretionary spending in the 2011 Budget Control Act (P.L. 112-25), which is approximately $8 billion over current federal government spending and represents about a 0.621 percent increase for most federal agencies and programs.

The CR followed an agreement negotiated by the Administration and Congressional leaders before the August recess who were anxious to avoid a government shutdown so close to the November elections. Although it remains unclear how and when Congress will complete the fiscal 2013 appropriations process, Appropriators in both the House and Senate hope to complete work on FY2013 spending during the lame-duck session with an omnibus package (which would combine all or several  appropriations bills into one large measure).  However, with the CR now guaranteeing funding for federal programs through late March, leaders may choose to delay finalizing FY2013 appropriations and instead focus on issues like the expiring tax cuts and the automatic, across-the-board spending cuts known as the “sequester.”