Update for COHEAO Members on the Reopening of the Federal Government and Forthcoming Budget Negotiations

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October 18, 2013 · by mlivolsi · Spark Notes

October 16, 2013

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Prepared by: Harrison Wadsworth  (hwadsworth@wpllc.net)

The staff of the US Department of Education returned to work today in Washington and around the country, thanks to the passage yesterday of legislation funding the federal government for three more months.  This “continuing resolution” or CR merely keeps the government and its programs subject to annual appropriations operating at their Fiscal Year 2013 levels until January 15, 2014.

The Congress at the same time passed legislation raising the federal debt ceiling enough to get the country through early February without defaulting on its obligations.  Perkins Loan funding was not in doubt because of the revolving fund structure and the (unfortunate and unfair) circumstance where the only funds coming into Perkins are from loan repayments.  Funding of the Direct Loan Program could have been in question, although it’s not clear that those loans would have ceased because under federal cost measurement rules, the program makes a profit for the government.  Luckily the country and the nation’s students didn’t have to deal with this question today.

The House of Representatives voted 285-144 late Wednesday night to pass the Senate-negotiated fiscal package, with all 198 Democrats present voting “yes” and 144 Republicans voting “no.” Democratic votes carried the package to passage since only 87 of 232 Republican best online casino lawmakers voted to extend both government funding and the debt ceiling.  Earlier in the evening, the Senate voted 81-18 to pass the bill, with all Democrats and most Republicans voting for it.  President Barack Obama signed the bill as soon as he received it from the House last night.

COHEAO is grateful that Congress moved forward but we look with concern over what comes next: negotiations over the federal budget that have to be completed by January 15th or we will have another government shutdown.  Senator Patty Murray, chairwoman of the Budget Committee, and House Budget Committee Chairman Pat Ryan (R-WI) will initially lead the negotiations, but the House and Senate leaders and the Obama Administration will be making the final decisions as to what is or isn’t acceptable.  Democrats and Republicans alike, although for somewhat different reasons, want the automatic spending cuts (sequestration) that apply only to so-called discretionary spending to be replaced by a more thoughtful approach to spending.  Both say they want “entitlement reform” included but that’s a political minefield since the biggest entitlements include Social Security, Medicare, Medicaid and Veterans Benefits.

House Republicans have called for reductions in the big cuts scheduled for defense by further cutting non-defense discretionary programs, including education.  Most Democrats want to raise taxes as part of the package, while Republicans oppose any tax increases.   But some on both sides of the aisle are working on comprehensive tax reform legislation.  In other words, a deal will be difficult given how polarized the positions are on the big issues.

January 15th, in addition to being the date the CR expires is also the date the next round of sequestrations of discretionary spending are scheduled to kick in under the Budget Control Act of 2011.  In other words, the immediate crisis was averted by a three-headed crisis is looking in the second half of January.  COHEAO hopes the country’s leaders can figure out a way to move forward before we get there.