Congress and FY2014 Appropriations

As we reported last month, before adjourning for the holidays, members of the House of Representatives and Senate were able to negotiate a budget resolution that set overall spending limits for fiscal year 2014. While only an early step in the budget process, the announcement was significant as it was the first time since 2010 that such an agreement had been reached.

With the current funding bill for the federal government expiring on January 15 and members of both chambers returning to Washington this week, work on a formal budget (including appropriations to individual agencies) has accelerated. As of press time, members of Congress have not been presented with a budget for the remainder of the fiscal year, making it quite likely that Congress will need to pass another short-term funding bill to prevent the government from closing again. What this will mean for the National Endowment for the Arts (NEA) is not entirely clear, however we expect funding for the agency to remain consistent for the remainder of the year.

While this news is frustrating, there are several positive points to consider. First and foremost, there is strong sentiment among leaders from both parties that funding for the government must not be allowed to lapse. Therefore, while it may require some additional time, the chances of Congress passing a formal budget for the NEA and other federal agencies for the first time since FY2010 seem high. Second, because the budget deal struck last month addressed the sequester for FY2014, one of the major stumbling blocks that led to the most recent government shutdown will not be an issue during these negotiations.

NASAA will keep a close watch as Congress continues to monitor the budget negotiations. We’d also like to highlight several other important dates in the near future. On January 28, President Obama will deliver his sixth State of the Union address, in which he is expected to urge Congress to continue to work together to embark on a more stable fiscal course. In February or March, the Treasury Department is expected to reach the limit of its borrowing authority. These deadlines could complicate budget talks, not only for the remainder of FY2014, but for FY2015 as well—which will begin immediately upon passage of the 2014 budget.