Congress is debating proposals to fund the federal government past September 30, amid efforts to defund the Affordable Care Act. Here are some of the leading questions about the continuing resolution that keeps the government operating and about the related debt ceiling debates on Capitol Hill.
1. What is a continuing resolution (CR)?
A CR provides temporary funding for the federal government in absence of the “normal” appropriations process in Congress. A CR defines a funding level over a specified period of time. For example, the last CR was signed into law on March 26, 2013, and funded the government, at current funding levels, through September 30, 2013 (end of the 2013 fiscal year). Because the budget for the next fiscal year was not finalized, a new CR is needed by the end of September to avoid a government shutdown. It is important to note that mandatory spending for programs like Social Security and Medicare continues independent of the CR process.
2. Why do we need a CR?
The last time Congress passed a budget was in 2009. Since then, federal government operations have been funded by a series of continuing resolutions. Typically, the budget process begins with the administration submitting a budget proposal in February for the following fiscal year. Congress reviews the request, and each chamber passes budget resolutions, which are eventually reconciled, passed, and sent to the President for signing. A CR is essentially a short-term “stop-gap” measure in the event the formal appropriations process fails to achieve agreement. While a CR can be a useful tool to buy time while differences are being resolved, it is not intended to replace the normal federal budget process.
3. What does Obamacare have to do with the CR?
On September 20, the House passed a continuing resolution bill to fund the federal government through December 15, 2013. The bill also includes a provision that removes funding appropriated for the Affordable Care Act. This bill is now being considered by the Senate. It is expected that the Senate will revise the bill by adding back funding for Obamacare and returning it to the House for consideration. The question is whether the House will pass that version of the bill or risk a government shutdown.
4. What is the status of the debt ceiling?
According to estimates, the federal government will reach its borrowing limitation somewhere between mid-October and early November. The debt ceiling prohibits the Treasury from borrowing more than a defined amount to pay the bills Congress has instructed the government to pay. Congress must act to raise the so-called debt ceiling to prevent the government from defaulting on its obligations.
The main question surrounds how the debt ceiling negotiation will be resolved. Signals from House Republicans point to several key demands in exchange for raising the debt ceiling including a one-year delay of the health-care reform law’s individual mandate, some triggers around future tax reform, and authorization of the Keystone pipeline. It is possible that conservatives in the House may acquiesce on demands for de-funding Obamacare through the CR process in exchange for using the debt ceiling debate to delay the individual mandate for a year. Democratic Congressional leadership as well as the President are on record as saying they will not negotiate over the debt ceiling.