Industry Insights
Regular Unregularity
By Kaitlyn Snyder
4 min read
The White House recently released its Fiscal Year (FY) 2024 budget request.
In DC, there’s an adage that the President proposes, and Congress disposes. The President’s budget is largely understood to be a statement of values from the current administration and a starting point for months of negotiation to follow.
Following the presidential budget request, the process passes to Congress with its mandate to control the purse strings. The budget committees for each chamber set 302a allocations, which control all discretionary funding for the federal government (not mandatory programs that exist outside of the budget process, like Social Security, Medicaid, etc.).
The 302as then go to the House and Senate Appropriations Committees to be divvied up into 302bs among 12 subcommittees, by which the entire federal government is divided. From there, the topline 302b number is divided among the myriad of programs within each subcommittee’s jurisdiction.
National Housing & Rehabilitation Association and its partners at the Campaign for Housing and Community Development Funding advocate for the highest 302b funding level for affordable housing community development programs. NH&RA primarily pays attention to two subcommittees – Transportation, Housing and Urban Development and Other Related Agencies, as well as Agriculture, Rural Development, Food and Drug Administration and Related Agencies.
Under regular order, each House and Senate subcommittee advances its own spending bill, which needs approval from the full appropriations committee before going to the floor of each chamber. Then a reconciliation committee meets to resolve any differences between the House and Senate bills ahead of the new fiscal year on October 1.
Unregular Order
But regular order is far from regular, “in the four decades since the current system for budgeting and spending tax dollars has been in effect, Congress has managed to pass all its required appropriations measures on time only four times: in fiscal 1977 (the first full fiscal year under the current system), 1989, 1995 and 1997.”
In the absence of regular order, Congress funds the federal government through Continuing Resolutions, which essentially take the previous year’s funding levels and continue them for a set period. These are primarily used to buy additional negotiating time, but flat funding can be particularly harmful to market-based housing programs when enacted for long periods of time. Congress also uses omnibuses (all 12 bills) and minibuses (more than one bill) to lump bills together and advance the work of appropriations subcommittees.
The Road Ahead
FY 2024 funding will likely be particularly challenging for several reasons:
- Divided Government: Democrats controlled the White House, House and Senate in FYs 2022 and 2023. During his bid for speakership, Representative Kevin McCarthy (R-CA) agreed to create a budget that balances over the next decade.
- Looming Debt Ceiling: The federal government is set to hit its debt limit in July 2023. And while these two items are separate and distinct, they are often lumped together.
Some within the Republican party are calling for a near freeze on discretionary spending and an end to multiple programs, in exchange for raising the debt ceiling. Meanwhile, President Joseph Biden, Jr. (D) has stated that he will not negotiate on the debt ceiling.
At the time of publication, the budget committees have yet to set their 302as. Take a moment to sign your organization to the 302b funding letter for affordable housing and community development programs.
Congressionally directed spending (earmarks) were reauthorized in 2021. When Republicans took back the House, they set an earmark limit of 0.5 percent of the total discretionary spending (aka 302a) and each House member is limited to 15 requests.
Appropriations committees will soon start their work and Congressional offices will submit member requests for committees to consider. The House deadline for members to submit requests was March 31 and the Senate deadline is April 6. This Resource Guide for Constituents has more information on submitting a request to your elected officials.
Anyone who tells you they know how this year will play out is lying, but history may be an indicator of the road ahead. During a Democratic-controlled Senate and White House and Republican-controlled House, Congress passed the Budget Control Act of 2011, which placed strict caps on funding levels through FY 2021. Though it’s worth noting that the full impact of sequestration never took effect, with Congress overriding the pre-determined caps each year.
