Inside (the Beltway) Scoop

By | November 2, 2017

Congressional Leadership Begins Conversations about Raising the Budget Caps; Appropriations Committee Hearing Explores Facilities and Administrative Costs

With just over a month until the “continuing resolution” (CR) expires on December 8, press reports indicate that congressional leaders have finally begun conversations about raising the Budget Control Act (BCA) spending caps.

Increasing the defense and non-defense spending limits is a critical step towards completing work on the fiscal year (FY) 2018 appropriations bills. Republicans want more money for military programs. Democrats seek additional funds for domestic priorities and insist that any defense increase is matched for non-defense agencies. Under the current BCA limits, total spending in 2018 is $5 billion below FY 2017.

Speaking to reporters, House Minority Leader Nancy Pelosi (D-CA) acknowledged movement. “We have some discussions going on. We’re on a path, and I’m optimistic, but it has to happen soon,” she said. Pelosi said an agreement on raising the caps is “close” and speculated that Congress could put a deal in place without approving another CR.

House Labor, Health and Human Services (LHHS) Subcommittee Chairman Tom Cole (R-OK) agreed with Pelosi’s prediction that Congress will eventually reach an agreement. “We have to have the major players, which are the president, the majority leader, the speaker and the two minority leaders, give us a set of numbers. And once they do that, I think the rest of it will move fairly rapidly,” Cole said. When asked about the timetable for completing the FY 2018 appropriations process, Cole hinted that he expected legislators to be in session until Christmas.

Representative Hal Rogers (R-KY), a member of the House Appropriations Committee, also shared his colleagues’ optimism that Congress would resolve their differences over funding. Rogers confirmed that talks were ongoing and added, “We’re working out details now. It’s going well, so I don’t foresee any major difficulties.” He also dismissed the notion that disagreements between the two parties would lead to a government shutdown later in the year.

In addition to negotiating the final funding levels for each agency, Congress will have to address policy changes requested by the Trump administration, including a proposal to implement a 10 percent cap on facilities and administrative (F & A) costs. The issue of F & A reimbursements was discussed at an October 24 House LHHS Appropriations Subcommittee hearing.

Convened by Chairman Cole, the session featured witnesses from the University of Oklahoma, Fred Hutchinson Cancer Research Center, the University of Connecticut School of Medicine, and the University of California, San Francisco. In his opening statement, Cole stated, “Based on many discussions with researchers, administrators, and other research funders both in Oklahoma and across the country, I am very concerned that the proposed F & A rate cut would drastically reduce the amount and quality of research conducted in the U.S., and that public universities would be particularly hard hit.”

Other LHHS Subcommittee members raised questions about the institutional impact of a 10 percent F & A cap. Ranking Member Rosa DeLauro (D-CT) asked how universities would fill the gap between the actual costs of doing research versus the amount reimbursed by NIH.

Other questions raised during the hearing: would F & A caps hinder professional opportunities for younger scientists? Will biotechnology companies be harmed by the administration’s proposal? What recommendations could be made to reduce regulatory burden for the research community?