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Home :  Federal Budget & Tax : 
Federal Budget & Tax:      News     Blog     Background    



Wednesday, September 28, 2005

Frist Calls on Bush to Suspend Funding

Senate Majority Leader Bill Frist (R-TN) will call on President Bush today to give Congress a list of offsets to potentially make up for spending related to Hurricane Katrina. This request is partially based on the fact that Katrina spending has conservatives in both chambers of Congress worried about how this recovery spending will affect the nation's deficits.

Frist will also apparently call on the President to do a formal Budget Act "rescission request" that would temporarily -- and possibly permanently -- suspend some federal spending to help pay for Katrina relief. According to an aide, Frist did not provide details on possible dollar figures, either for the offsets or the rescission request. Under the Budget Act provision (which is also known as impoundment authority) the White House can temporarily suspend federal spending for up to 45 days of "continuous session," typically 60 days from the date of the request. Suspending regular spending to deal with the cost of Katrina is neither responsible nor is it necessary. Yes, Katrina spending will add to our deficit, but the deficit can be brought down by a combination of responsible spending cuts and phasing out (or repealing) certain tax cuts. Frist's "responsible" call for a suspension on spending leads one to wonder where he and other prominent GOP leaders were when Bush passed trillions of dollars worth of tax cuts in 2001 and 2003.





Posted by Becky Lewis, 05:29:09 PM



End of Fiscal Year Approaching

Fiscal year 2005 ends this Friday, Sept. 30, and House and Senate Republican leaders have not been able to pass all spending bills for FY 2006 on the floor. Thus, we can expect them to pass a stop-gap funding bill to cover federal government spending by the end of the week.

According to an aide, GOP leaders in both chambers will push through a CR to fund government programs through Nov. 18. While some believe this extension will give appropriators sufficient time to wrap up their work on the outstanding FY 2006 appropriations bills, others think GOP leaders will not make their ambitious goal to pass all of the bills as separate measures this year. While the House has passed all eleven of its spending bills, the Senate has only passed eight of twelve, and only two of those have been given final approval and sent to Bush for his signature.





Posted by Becky Lewis, 12:41:51 PM



Friday, September 23, 2005

FEMA Report Vague on how Money is Being Spent

By law, the Secretary of Homeland Security must provide Congress with weekly reports detailing how FEMA is spending Katrina relief funds. The first report was sent to Congress September 15, and the second was sent yesterday. According to Rep. David Obey (D-WI) -- ranking member on the House Appropriations Committee -- the second report sent to Congress has virtually no details in it, much like the first report.

Obey said, "We asked for specific information on how they are awarding contracts and who contracts are going to. Instead of telling us who is doing what and how, we got a few spreadsheets." In order to get spending details, Obey and Senate ranking member Robert Byrd (D-WV) had specifically sent a letter to the OMB. Their requests, however, were not heeded, and their letter never answered. Instead of knowing how the money is being spent, Obey said, "We don't know what the administration is doing because they don't know what they are doing. We don't know where the nearly $16 billion FEMA's allocated went, we don't know what they're planning to do with the $44 billion they've got left."





Posted by Becky Lewis, 04:52:59 PM



Wednesday, September 21, 2005

More On Cost of Rebuilding; Congress Passes Tax Bill

Many Republican leaders in the House and Senate are worried about the costs of rebuilding after Katrina, even though President Bush has promised, and rightly so, to devote all the funds needed to help the devastated region. Republicans who are worried about excessive deficit-financed spending are pushing for the costs will be offset (most are suggesting by cutting the budget elsewhere). To appease them, OMB Director Josh Bolten said Tuesday that the administration would consider offsets, but did not offer any details about what would be cut and by how much. As Stan Collender correctly points out (subscription required), any offsets proposed by the administration would to little, if anything, to reduce the amount Katrina relief spending will add to the deficit, and the national debt. Because President Bush refuses to even consider not extending or rolling back some of his first term tax cuts, it will be future generations who will be paying for reconstructing the Gulf Coast.

The federal government is required by law to pay at least 75 percent of the cost of rebuilding public infrastructure after a disaster (1988 Stafford Act). To comply, Congress -- besides approving about $64 billion in emergency spending -- has agreed on a tax-relief bill to expand deductions this year for victims. The final bill was scored by the Joint Committee on Taxation as costing $6.1 billion over 10 years. Congress hopes these targeted tax cuts will spur employment of low-income workers on the Gulf Coast.

In addition, President Bush signed three bills today to help in the aftermath of the disaster. The bills waive Pell Grant and other federal student loan requirements for displaced college students and expand Temporary Assistance to Needy Families eligibility for victims.

CNN.com: House Passes Tax Breaks for Hurricane Katrina Victims




Posted by Becky Lewis, 12:08:19 PM



Friday, September 16, 2005

Rep. Obey Calls Administration Reports on Spending "Useless"

In the most recent emergency supplemental bill for relief funding for the victims of Hurricane Katrina, the House and Senate included a provision that required the administration to provide weekly reports on how the money was being spent by FEMA and the Army Corps of Engineers. The Office of Management and Budget sent Congress the first of those reports late last night.

Today, the ranking minority member of the House Appropriations Committee David Obey (D-WI) called the report "useless" and reiterated the need for detailed information, saying, "Congress is spending an unprecedented amount of money on disaster relief, requiring unprecedented diligence to avoid waste, fraud and abuse. We need specific information to ensure accountability."





Posted by Adam Hughes, 04:24:55 PM



Thursday, September 15, 2005

Approps Dems Request Strict Oversight of Relief Funds

Yesterday, Sen. Robert Byrd (D-WV) and Rep. David Obey (D-WI) -- who are the ranking members on the Senate and House Appropriations Committees -- sent a letter to OMB Director Joshua B. Bolten sharing their thoughts on the type of detail they would like to see reported to them for oversite purposes of the current government relief spending. The letter requests that the OMB provide the Appropriations Committees with information regarding all spending, so the committee members "can determine whether taxpayer dollars are being spent wisely and efficiently."

Specifically, the letter requests:


  • Detailed information on every obligation, allocation, or expenditure that totals more than $50 million, broken down in no less than $50 million increments. The detailed information should include: the purpose; whether the work will be performed by the government or a contractor; and, if the work is performed by a contractor, the name of the contractor, the type of contract let (fixed-price, cost-plus), and whether the contract was sole-source, full and open competition, or limited competition;

  • The amount of credit card purchases by agency/mission assignment;

  • Weekly obligations, allocations, and expenditures by agency and state, and by purpose/mission assignment (for example, public assistance, debris removal, etc.);

  • Weekly status of the disaster relief fund, including unexpended balance, unobligated balance and unallocated balance; and

  • Information on any waivers granted.




  • Posted by Becky Lewis, 02:14:32 PM




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