For the third time this year, Congressional leaders faced a federal government shutdown over budget negotiations. However, unlike the April and August deals, this deal came days – instead of hours – before the deadline.
At issue was a dispute over how to fund disaster relief, a concern that was heightened in late August after an earthquake struck central Virginia and Hurricane Irene caused flooding in the Northeast.
Although Democrats said the Federal Emergency Management Agency needed more funding, they agreed to accept a Republican plan to spend $3.65 billion in disaster relief money, $1 billion of which would have gone toward the budget for the current fiscal year, which will end Friday. Republicans, concerned about adding to the budget deficit, refused to support the funding without $1.6 billion in accompanying cuts. Their largest target was an auto loan program popular with Democrats, leading to the standoff.
The showdown between the two sides was averted on Monday, when FEMA said it could make ends meet through the end of the week. That led to an agreement that calls for the agency and other government disaster relief programs to forgo the $1 billion in proposed funding for this week. Beginning Saturday and running to Nov. 18, FEMA can begin to tap the remaining $2.65 billion for ongoing efforts.
Although the deal avoids a federal government shutdown, it does not resolve the debate over how much funding FEMA needs in the next fiscal year. The White House has said that FEMA will need $4.6 billion in funding – a number that many Democrats believe to be underestimated. The Democrats plan to push for FEMA to be fully funded with the hope that the scope of funding may be broadened somewhat. Both parties agree that the current deal is a good template for meeting each other half-way.
To read MACo’s prior coverage of the Federal budget negotiations, please click one of the following links:
Federal Cutback Effects on Maryland Still Uncertain (August 11, 2011)
Federal Government Shutdown Could Hit Maryland Economy Hard (posted 3/1/11)