Hoyer Pessimistic about FY14 Budget Compromise

by Rick Antonucci, Analyst

In a press interview, Minority Whip Steny Hoyer, representative from Maryland, stated that he did not believe there was any chance Congress would pass a budget before October. The budgets passed by the Republican led House and the Democrat led Senate have a $91 Billion disparity and Hoyer says that the Republicans are unwilling to go to conference until the Senate reduces their budget to match that of the House. He feels certain that the ongoing stalemate will lead to the next fiscal year starting with a continuing resolution (CR). Additionally, this will keep the current funding levels unchanged from FY13 which mean sequestered levels will likely remain intact for the time being. This setback reflects the longstanding impasse within Congress over the federal budget as Congress hasn’t passed a formal budget since 2008, instead relying on series of continuing resolutions and appropriations bills to keep the government operating. The President’s budget attempts to remedy this disparity with a plan that reduces the deficit while still fully funding each new initiative.

So what does this mean for you as we head into FY14? Since a continuing resolution’s sole purpose is to keep the government from shutting down, budget levels do not change and there are no new starts. Most agencies under the current CR are operating under FY12 levels. Agencies in this situation are usually more hesitant to pursue major initiatives or make strategic purchases, instead focusing on day to day operations. There are exceptions, however, DOD, DOJ, USDA, NASA, DHS, and DOC will have some more flexibility in creating new programs as they have been granted appropriations bills to provide funding beyond the CR.

Is there an end in sight? Not until there can be some kind of compromise between the House and Senate proposed budgets. However, just because there have been severe cuts due to sequestration does not mean that there is not money out there. While new program starts are scarce during continuing resolutions, opportunities exist within operations and maintenance budgets, particularly in the area of refreshes and license renewals. Also, expect some agencies to seek Congressional approval to shift money around to pursue their high priority initiatives.