Congress is back; House Passes Reconciliation; POTUS’s Last Budget Request Projected to be released (one week late)

According to a tweet posted by OMB Director Shaun Donovan today, the President's budget request, the last of his administration should be released on February 9th; that makes the budget about a week and a day late, according to the statutory deadline (it requires the president submit the budget request to Congress on the first Monday of February). The appropriations process is expected to ramp up quickly immediately upon its release.

Congressional Quarterly notes that House Budget Committee Chairman Price intends to mark up a fiscal 2017 budget resolution early this spring. Of course, the Bipartisan Budget Act of 2015 already sets the "302(a)" level for discretionary spending for FY 2017. Expect little deviation from that level at least for this fiscal year. Still, a budget resolution would allow the House and Senate to include reconciliation instructions, which would allow Congress to take up a tax system overhaul or changes to entitlements under expedited procedures. It could also be used to make changes to the budget process itself.

Budget Balancing Act: The tax extenders package that passed with the Consolidated Appropriations Act in December made many tax breaks permanent and delayed the implementation of others. All in all, the tax and spending legislation increased the deficit by $680 billion over the next ten years. $157 billion of that increase is the result of extension of refundable tax credits, as CQ reports.

With the topline discretionary allocations already established for FY 2017 under the Bipartisan Budget Act, less revenue coming into the Treasury will require deeper spending cuts in the budget resolutions if lawmakers want to balance the budget over 10 years. Expect cuts to entitlements and non-defense discretionary (NDD) in the out-years in the forthcoming proposals.

Last updated: January 8, 2016