CQ Article: OMB proposals to cut $18 billion from FY 2017 CR 3/28/2017

March 27, 2017 – 10:46 p.m.

Details on Trump’s Fiscal 2017 Budget Cuts

By Paul M. Krawzak and Kellie Mejdrich, CQ Roll Call

The Office of Management and Budget has proposed $17.9 billion in specific spending cuts to offset higher proposed defense and border security spending in the current fiscal year, according to a document obtained Monday by CQ.

In a spreadsheet outlining the fiscal 2017 reductions shared with some Republican lawmakers, the White House budget office suggests cutting Pell Grant funding by $1.3 billion; National Institutes of Health funding by $1.2 billion; and the Community Development Block Grant program by $1.5 billion, among billions of dollars in other reductions across federal agencies.

A person with knowledge of the document told CQ it was sent out by the administration, and an administration official confirmed a list of proposed fiscal 2017 cuts had been distributed. The document shows spending reductions spread across nine Appropriations subcommittees that allocate nondefense discretionary dollars.

The Labor-HHS-Education Subcommittee would take the biggest hit at $7.2 billion, while State-Foreign Operations would be chopped by $2.8 billion. Defense and most of Homeland Security are not included in the spreadsheet.

None of the spending reductions would go into effect without Congress’ approval, and appropriators in interviews Monday already were balking at such dramatic changes in current year funding. Negotiations are concluded on some spending bills.

An OMB official declined to comment Monday night on the proposal.

Specifics on Cuts

President Donald Trump asked for $30 billion in increased defense spending and $3 billion more for border security in fiscal 2017, which ends Sept. 30, as part of his fiscal 2018 budget submission last month.

As an offset, he asked Congress to cut $18 billion in nondefense spending but without offering any details at the time. The spending reductions sent to some members of Congress represent the first fleshing out of how the cuts would be made. The government is now operating under a continuing resolution (PL 114-254) that runs out April 28.

The document said the NIH cuts, about a 4 percent reduction from the funding level in the CR, could be achieved by eliminating $50 million in spending on IDeA grants and reducing research grants by $1.182 billion.

Institutional Development Awards, or IDeA program grants, are aimed at broadening the geographic distribution of federal funding for biomedical research across the nation, including in rural and medically underserved communities.

Referring to the proposed cuts in the Community Development Block Grants program, a 50 percent reduction from the stopgap level, the document said no grants have been awarded for the current fiscal year, the program is unauthorized “and has been challenged to demonstrate its effectiveness given the breadth of activities it can support.”

The Community Development Block Grant program provides funds to state and local governments for a wide variety of projects including infrastructure, economic development, public facilities, community centers and housing.

On Pell Grants, which are awarded to college students determined to have financial need, the White House document said that based on the Congressional Budget Office’s January spending projection, the Pell Grant program has an $8.5 billion unobligated balance going into fiscal 2017. The document said that the rescission “would still leave the program on solid footing.”

Many of the fiscal 2017 cuts are achieved by targeting programs similar to those targeted in Trump’s fiscal 2018 budget outline, including the State Department, Pell Grant money, NIH, foreign aid and the Department of Housing and Urban Development.

Trump also proposes to slash a large amount of funding for the subcommittee that oversees transportation, housing and urban development, according to the document.

But Rep. David E. Price, the top Democrat on the House Transportation-HUD Appropriations Subcommittee, said the subcommittee had already wrapped up bipartisan negotiations “months ago,” though he conceded: “the ink isn’t – it’s not finalized in every aspect, but it’s basically there.”

Late in the Year

Rep. Tom Cole, chairman of the Labor-HHS-Education Subcommittee on House Appropriations, said $18 billion in cuts would be problematic so late in the fiscal year.

“Well, you know that’s fine but it’s a little late in the process. We’ve closed out our bills,” Cole said.

“No entering administration should be negotiating the budget for the year it’s in, because they don’t have the people there to do it. They just got an OMB director, they don’t have a lot of their staff, they don’t have their people in places in the Cabinet agencies in order to make intelligent decisions and even recommendations,” Cole said.

Sen. Lamar Alexander, who heads up the Senate Appropriations Energy-Water Subcommittee, also seemed to shake off the Trump fiscal 2017 request.

“I think that’s a little late,” Alexander, R-Tenn., said Monday.

“You know, presidents do things like that and … the responsibility for appropriations is with the Congress and we respect the president. He suggested some things, and of course we’ll look at them, but we’ll write the budget,” Alexander said.