Legislative Update

Congress Moves to Spending Bills as Budget Plan Stalls: Congress took a two week recess in April after failing to agree on a 2007 budget resolution. Fiscal policy may continue to exasperate legislators on Capitol Hill after they reconvene on April 25. The Senate adopted its initial budget in March, but disagreements among Republican factions have kept the House budget from the floor. Under the Budget Act, appropriators can bring spending bills before the House after May 15 if Congress has failed to adopt a final budget resolution by that time.

While Republican moderates and conservatives in the House remain at odds over spending priorities, the House Appropriations Committee is beginning to mark up its fiscal 2007 spending bills. The Interior appropriations legislation, which includes funds for the National Endowment for the Arts (NEA), is expected to be among the first sent to the House floor, tentatively scheduled for mid-May.

On March 29, NEA Chair Dana Gioia testified before the House Interior Appropriations Subcommittee on behalf of the Administration’s budget proposal. The President’s fiscal year 2007 spending request leaves the arts endowment with level funding at $124.4 million. Challenge America would lose $3.462 million in the President’s budget plan, with $1.843 million of those funds going to increase program support and salaries and expenses, $1.117 million added to the NEA direct grants category, and $508,000 to be added to State and Regional Partnerships. Spending for American Masterpieces remains unchanged in the 2007 budget proposal.

In his statement to the House panel, Gioia described the NEA as having “broadened and democratized” its grants process through Challenge America–which he called “part of the DNA of the NEA.” According to Gioia, Challenge America ensures that direct grants reach arts organizations in every congressional district and works “to supplement our state arts agency and regional arts organizations grants.” In addition to giving high marks to the Challenge America program, Gioia outlined the progress of the national initiatives conceived under his chairmanship: Shakespeare in American Communities, NEA Jazz in the Schools, Operation Homecoming, American Masterpieces, and pilot programs launched for The Big Read.

In the meantime, the Congressional Arts Caucus co-chairs, Reps. Louise Slaughter (D-NY) and Christopher Shays (R-CT), gathered 122 House member signatures in support of a letter urging funding for the NEA at $170 million. This amount would represent an increase of more than $45 million and a return to the agency’s peak funding level of 1992. NASAA, working in coalition with other arts service organizations, advocates the $170 million funding level as an important restoration of funds cut over a decade ago from the NEA’s core grant-making programs, including Challenge America.

The Arts Caucus letter points out that the President’s budget “reallocates funds at the expense of some valuable programs” and highlights Challenge America. The legislators’ letter also calls attention to the value of NEA funds for:

leveraging private funding for arts organizations around the country,
investing in the economic growth of communities through arts programs,
supporting lifelong learning in the arts, and
helping to sustain support in local communities for arts education.

The outcome of the appropriations debate remains uncertain. The 2007 White House budget calls for a cap on discretionary domestic spending, and because the Bush budget would increase defense and security spending, such a cap actually amounts to cuts in many programs. The President’s spending plan proposes to continue squeezing funds out of that one-sixth of the budget left after defense and homeland security appropriations.

With an inflation rate of 3.2 percent since 2005, the level funding proposed by the President for federal arts spending would, in effect, impose cuts on actual available spending for arts activities. The budget resolution passed by the Senate in March rejected the President’s cap on domestic spending by increasing the budget total. Republican moderates in the House would like to force the same increase in spending for domestic discretionary funds in their version.

In late April, the House put together a bill aimed at tightening lobbying rules in Congress which would curb congressional earmarks for special projects. House appropriations committee leadership complained that only appropriations bill earmarks were targeted for special scrutiny–to be identified by the name of the sponsoring legislator and subject to floor votes to remove. In response, the House Republican leadership offered assurances that the new rules would apply to earmarks in other bills as well (such as the transportation legislation passed last year that was loaded with money for specific highways, bridges and other projects, or tax bills with favors narrowly written to apply to individual special interests.)

The political battle over the 2007 congressional budget reflects the frustrated desire of moderate Republicans and most Demaocrats to maintain support for popular domestic programs in the face of the President’s proposed budget cuts for the coming fiscal year. Conservatives who want to impose even deeper spending cuts feel they have compromised enough by accepting the President’s spending caps. Moderates say that added spending is needed for domestic discretionary programs. As the House continues to stalemate on the budget resolution, the issue disintegrates and focus shifts to battles over spending in individual appropriations bills.