Congress and President Reach Two Year Budget Deal

Congress and President Reach Two Year Budget Deal

This week, House Democratic leadership, Senate Republican leadership, and the President reached a deal to lift the overall spending caps imposed by the Budget Control Act (BCA) of 2011 for the next two years and to increase the nation’s debt limit for two years. Despite some opposition from both conservative Republicans and progressive Democrats, it is expected that the House will pass the legislation today, and the Senate will pass it next week with the President signing the bill shortly thereafter. Most importantly, the bill provides certainty of overall spending for the next two years and should significantly help to avoid the threat of a shutdown of the federal government during that time.

Specifically, the bill sets the FY20 spending cap for non-defense discretionary programs at $621.5B, an increase of $24.5B over the FY19 cap and an increase of $78.5B over what the BCA cap would have imposed without this legislation. The FY21 spending cap is set at $626.5B. Overall, the two-year deal results in $54B in increases over the FY19 levels.

Although this budget deal sets the overall spending level, both the House and Senate will still need to come to an agreement on the specific spending levels for each agency and program through the appropriations bills.