Congress Reaches Deal for FY 2017, Preserves Programs Critical to Planning

After seven months of short-term spending bills, Congressional leadership reached a deal over the weekend to finalize spending for the current 2017 fiscal year that began in October.

The $1.16 trillion deal includes all 11 unfinished spending bills and provides level funding or a slight increase for most programs critical to planners.

This is a huge win for planners in a difficult political environment. The President proposed a devastating $18 billion cut to domestic programs in the current fiscal year, asking Congress to eliminate programs like TIGER and Choice Neighborhoods and for a 50 percent cut to the Community Development Block Grant (CDBG) program.

It should be noted that this proposal is different than the President's proposal for FY 2018, which is even more devastating than his requests for the current fiscal year.

Highlights of the FY 2017 Omnibus

Housing and Urban Development

The omnibus spending bill provides the Department of Housing and Urban Development with a 1 percent increase in funding overall. The bill includes level funding for CDBG at $3 billion and the HOME Investment Partnerships program at $950 million. Choice Neighborhoods received a 10 percent increase to a total funding level of $137.5 million, including $5 million for planning grants.

The bill also includes language prohibiting HUD from directing grantees to "undertake specific changes to existing zoning laws" as a part of implementing Affirmatively Furthering Fair Housing, though the bill stops short of prohibiting funding.

Transportation

The omnibus provides funding for the Department of Transportation based on levels enacted in the FAST Act. While the amounts are not a surprise, the certainty is welcome for local, state, and regional transportation agencies.

For discretionary transportation programs, the measure provides $500 million for new TIGER grants and $2.4 billion for New Starts transit grants. Both programs are targeted for elimination in the Trump administration's FY18 budget.

Although funding for the TIGER program remains level, the measure continues to prohibit DOT from providing planning grants. The bill will bring a sigh of relief in some communities where previous New Starts commitments had been under threat by the administration. Despite being targeted for elimination, New Starts will see a boost of $236 million in FY17. Funding is also provided for crude oil by rail safety and autonomous vehicle research initiatives.

Interior

In the omnibus, Congress plans to fund the Land and Water Conservation Fund (LWCF) at $400 million, a $50 million cut. The funding prioritizes state and local recreation programs while reducing federal land acquisition for national parks. State Assistance funding is held constant at $110 million, and the Outdoor Recreation Legacy Partnership (ORLP) program, which specifically funds urban and community park projects, maintains level funding at $12 million.

These levels will continue to support communities working to improve access to parks and open space for outdoor recreation.

EPA

The EPA funds conservation, infrastructure, and resilience projects critical to planners working on environmental issues around the country. The FY17 spending bill continues to support water infrastructure at the EPA maintaining level funding for the Clean Water State Revolving Fund and the Drinking Water State Revolving Fund at $1.4 billion and $863 million respectively.

Congress also provides $10 million for recently-created the Water Infrastructure Finance and Innovation Act (WIFIA). Funding to support brownfields redevelopment projects remains level as well.

Commerce

Data produced by the decennial Census and the annual American Community Survey helps planners better understand economic, social, and demographic indicators that make up communities. The Census Bureau's periodic censuses and programs, which include both the decennial Census and the American Community Survey, are slated to receive a small increase in FY17 appropriations.

As we approach the 2020 Census, now is the time Congress must begin truly ramping up appropriations to ensure the Census Bureau has the resources it needs to conduct an accurate and comprehensive census.

The Commerce Department's Economic Development Administration (EDA), which provides grants and assistance to help communities boost their economies, would also see a $15 million funding increase under this bill.

Finally, funding for the National Oceanic and Atmospheric Administration (NOAA) would decrease slightly in FY17 by about $90 million or 1.5 percent. Programs at NOAA support coastal communities working to improve resilience.

Other

The FY17 omnibus continues to fund Pre-Disaster Mitigation Grants under the Department of Homeland Security.

Process Going Forward

The omnibus spending package will be considered by the House on Wednesday, where it is expected to be approved easily on a bipartisan basis. It will then get final approval from the Senate, which will send the bill to the President for his signature by Friday night.

The spending deal ends over seven months of delays in finalizing spending for the current fiscal year.

Initially opting to postpone making final spending decisions until after the election, Congress approved a short-term spending bill that ran out in mid-December, with the intention of wrapping up work on the fiscal year during the lame duck. However, the then President-elect signaled to Congress that he would like to have input on spending in the current fiscal year, so legislators passed a short-term bill until April 28.

Congressional leadership, close to wrapping up negotiations, signaled last week that they needed an additional week of time, requiring the passage of yet another short-term spending bill that expires on this upcoming Friday, May 5.

The path to a deal was bumpy, but far less rocky than it could have been. Controversial policy riders and requests from the President to fund a border wall with Mexico and an increase defense spending were omitted, likely delaying a larger battle for later in the year.

Trouble Down the Road for Upcoming Fiscal Year 2018

Though recent conversations have focused on finalizing the current fiscal year, the ability of Congress to complete its budget and appropriations work before the upcoming FY 2018 that begins on October 1, 2017, is already questionable.

In a typical year, the President releases his budget proposal on the first Monday in February, allowing Congress to begin its work on a budget resolution and on appropriations bill. Though the President released an FY 2018 "skinny budget" in March, outlining a proposal of devastating cuts to federal planning programs, his full budget proposal is not expected until mid-May. This has prevented Congress from even beginning budget conversations, whereas this time last year both the House and Senate had already sent spending bills to the floor.

This limited timeline becomes more daunting when considering the controversial policy discussions that are likely to arise.

Rather than shut the government down on his 100th day in office, the President punted the battle of securing funding for his Mexican border wall to FY 2018. Additionally, his budget proposal calls for steep cuts to domestic programs, breaking a statutory parity between defense and non-defense spending that will require a change to the Budget Control Act, a heavy lift for Republicans that do not control a filibuster-proof majority of the Senate.

The willingness of the President to shut the government down over his policy requests has not been fully tested, but earlier today, he tweeted that "our country needs a good 'shutdown' in September."

Additionally, the willingness of House Speaker Paul Ryan (R-Wisc.) and Senate Majority Leader Mitch McConnell (R-Ky.) to defy the President's requests in order to avoid triggering a government shutdown has also not been fully tested.

Top image: U.S. Capitol Dome in spring. Photo by Flickr user MudflapDC (CC BY-NC-ND 2.0).