Removing Barriers Blog

Bipartisan Budget Agreement Reached
Posted July 29, 2019 by CUNA Advocacy

Last week, budget negotiations between the Administration and Congressional leaders bore fruit as all parties agreed to suspend mandatory discretionary budget cuts included in the Budget Control Act of 2011.  These spending cuts would have gone into effect starting September 30, 2019.  Negotiators also agreed to suspend the federal statutory debt ceiling through July 31, 2021.  Absent any agreement, the debt ceiling was expected to be breached later next month. 

The product of these negotiations was H.R. 3877, the Bipartisan Budget Act of 2019, which passed the House of Representatives yesterday afternoon in a bipartisan vote of 284 to 149.  The Senate is expected to pass this legislation next week and the president has agreed to sign it into law. 

The legislation will spend $1.37 trillion in fiscal year (FY) 2020, and raise spending for military and non-military programs by $320 billion in FY 2020 and 2021.  Had this agreement not been reached, $125 billion in automatic spending would have started on October 1st, the first day of FY 2020.  Under the deal, total discretionary spending will increase slightly to $1.375 trillion in FY 2021.  The new legislation does provide for $77 billion in offsets to partially pay for the new spending increases. 

While the House-passed legislation provides a legal framework for the budget deal, the Congress and the Administration still must complete the FY 2020 and 2021 appropriations process.  In other words, the agreement reached this week does not guarantee that a government shutdown will be averted nor that one or several continuing resolutions will not be needed.  The House has adjourned for its summer recess and Senate is expected to adjourn next week.  Both chambers are expected to reconvene September 9th.  That provides precious few days for the Congress to pass appropriations legislation before funding expires on September 30th. 

This budget agreement means that cuts to credit union priorities will likely be averted.  Such priorities include funding for the Small Business Administration, the Community Development Financial Institutions Fund and the Community Development Revolving Loan Fund.