On November 17, after intense pressure from education, health care, and other advocates, the House of Representatives defeated, by a vote of 224 to 209, the fiscal year 2006 Labor, Health and Human Services (HHS), and Education spending bill that had emerged from the Senate-House conference process, with 22 Republicans joining all House Democrats in opposition. The bill would have provided $56.5 billion for the Department of Education-$169 million below the House-passed bill, $212 million below the Senate-passed bill, and $59.1 million below FY 2005 appropriations. The defeat marks the first time since 1995 that a conference report, a compromise version of the bills passed by the House and the Senate, was defeated in the House.
In speaking against the bill, Representative David Obey (D-WI) noted that the bill would have cut education funding for the first time in a decade. “Education programs under the No Child Left Behind rubric are cut by $784 million below last year,” he said. “That is $13 billion below the authorization, and on a cumulative basis, it is some $40 billion short of what we promised we would have provided these past years since we passed No Child Left Behind.”
In addition to a lack of funding for education, rural health care, and other priorities, the bill also did not contain money for earmarks included earlier by individual members. Often referred to as “pork projects,” earmarks are very narrow in scope, often only benefiting a single congressional district. Senator Arlen Specter (R-PA), chairman of the Senate Appropriations Subcommittee on Labor, HHS, and Educationand one of the negotiators in the House-Senate conference, explained that removing the earmarks freed up money for other priorities:
The removal of the earmarks has focused the attention of the members of both bodies about the blatant inadequacy of the allocation for this subcommittee, which funds the major capital assets for our nation for health, education, and worker training. Had the $1 billion been spent on earmarks, we would have sustained intolerable cuts in programs such as [the Low Income Home Energy Assistance Program], community health centers, community services block grant, health professionals, including nursing and Head Start. With inflation considered, program cuts will occur in these and other programs such as NIH, Title I, and special education even without the earmarks.
After its defeat, the funding bill was sent back to House-Senate conference for further negotiation. On November 18, the Senate voted 66 to 28 to instruct its negotiators to designate the bill’s $2.2 billion for the Low Income Home Energy Assistance Program (LIHEAP) as “emergency spending,” which would not count the money toward the bill’s $142.5 billion spending cap. Specter also argued that such a designation would free the money to use for other programs.
As a result of failing to pass the Labor-HHS-Education spending bill, the House and Senate enacted a continuing resolution that would temporarily fund these programs until December 17, or until a spending bill can be enacted into law. However, the continuing resolution funds programs under the Labor-HHS-Education spending bill at the lowest of the FY 2005 level, the House-passed FY 2006 level, or the Senate-passed FY 2006 level. (A chart comparing the different funding levels for selected education programs is available here)
If Congress is unable to come to agreement on an appropriations bill and chooses to extend the continuing resolution to fund these programs throughout FY 2006, rather than having it expire on December 17, existing education programs could be cut by as much as $1.4 billion. While some House Republicans are in favor of such an extension, the Senate is unlikely to agree. One option to a yearlong continuing resolution under discussion is to combine the bill with the FY 2006 Defense appropriations bill, all but guaranteeing its passage.
A final decision on the Labor-HHS-Education spending bill is not expected until the Senate returns from its Thanksgiving break on December 12. The House will return the week of December 5.
|Congressional Action on Budget Measures Begins to Heat Up
Over the last several weeks, Congress has stepped up activity on two measures that affect revenue and expenses in the federal budget. The first is a tax cut package that contains an extension of the 2003 tax break on capital gains and dividends, among other provisions. The second is a budget reconciliation bill that would cut spending on mandatory programs, such as Medicaid and student loans.
On November 17, the Senate passed $74 billion in tax cuts and about $14.5 billion in offsets, or initiatives that will raise revenue, for a final cost of $59.6 billion. Included among the tax breaks were a deduction for tuition and related higher-education expenses that would expire in 2005, as well as a series of tax incentives designed to promote economic activity along the Gulf Coast.
The original Senate package came with a $68.8 billion price tag and would have extended the 2003 tax break on capital gains and dividends. However, Senator Olympia J. Snowe (R-ME), who often acts as the moderate swing vote in the closely divided Senate Finance Committee, was successful in getting the Senate to remove tax breaks on capital gains and dividends. “I believe it is not a question of whether or not we support tax cuts,” she said. “It is really a question of what we can afford to do now in the current economic and fiscal climate.”
Earlier that week, the House Ways and Means Committee gave its approval to a $56.1 billion tax cut package. Unlike the Senate, the House package includes a 2-year extension of the 2003 tax break on capital gains and dividends. Conservatives are expected to push for the inclusion of that tax break in the final version, to be negotiated in a House-Senate conference after the House passes its final version of the bill, which is expected no sooner than the week of December 5. According to CQ Weekly, some House moderates were “clearly hesitant about the public relations problems inherent in voting for a tax cut so soon after voting to reduce spending programs.”
On November 18, the House of Representatives passed a $49.9 billion bill that will cut funding from Medicare, food stamps, and student loans by a very slim 217 to 215 margin; 14 Republicans joined all Democrats in voting against the bill. CQ Weekly called the bill’s passage a “hard-fought win” for the Republican leadership team, which had “struggled for the past two months to unite the moderate and conservative wings of the party.” The bill now goes to a House-Senate conference, which is expected to be quite contentious. Earlier this month, the Senate passed a very different $35 billion package that included fewer cuts to programs for the poor.