April 13, 2011
The House is expected to vote today on the final agreement on the FY 2011 “continuing resolution” (HR 1473), funding discretionary federal programs for the remaining six months of the current fiscal year. As has been widely reported in the press, this final agreement follows months of partisan stalemate that nearly shutdown the federal government last week.
While there are cuts to a number of programs, the final agreement on the “continuing resolution” largely restores deep reductions included in an earlier version of the legislation (HR 1), which passed the House in February. This included a seven percent reduction to mental illness research and a 70 percent reduction to a critical program that builds supportive housing for non-elderly adults living with mental illness.
As part of the agreement between the President and bipartisan congressional leaders, all discretionary programs would be subject to an across-the-board 0.2 percent rescission. Beyond this mandatory reduction, the final “continuing resolution” will leave program administrators and agency heads significant leeway in how to allocate any reductions that must be realized between now and the end of the current fiscal year, September 30, 2011. In many cases, funding levels are set for entire agencies with no direction from Congress as to what functions to cut (e.g., personnel, contracts, discretionary grants, etc.). As a result, the legislation requires each agency to submit a plan to Congress within 30 days on how all reductions are to be imposed.
In a major victory, investments in biomedical research at the National Institutes of Health (NIH) will not face a significant cut below its current FY 2010 level of $30.8 billion. This includes the National Institute of Mental Health (NIMH). In addition to the 0.2 percent rescission noted above, there is a $210 million reduction for NIH that will be imposed on a pro-rata basis across all NIH institutes and centers. For NIMH, this will mean less than a 0.9 percent reduction. This will leave NIMH close to its FY 2010 level of $1.489 billion for the remaining months of the current fiscal year. By contrast, the House passed “continuing resolution” would have imposed a 7 percent reduction on NIMH, an $86 million cut.
Mental illness and substance abuse treatment services at the Substance Abuse and Mental Health Services Administration (SAMHSA) would be subject to a $52 million reduction under the final “continuing resolution,” a $45 million cut, plus the 0.2 percent rescission imposed on all agencies and programs. This is about a 1.5 percent cut to SAMHSA’s overall budget of $3.386 billion. By contrast, the House-passed version of HR 1 would have imposed a $200 million cut to SAMHSA. It is unclear at this point how SAMHSA Administrator Pam Hyde will allocate these reductions within the agency’s budget. More than two thirds of the SAMHSA’s budget is formula grant programs for the states that funds critical mental health and substance abuse treatment services.
In a major victory, the final “continuing resolution” for FY 2011 restores a 70 percent reduction that had been proposed in the House-passed version of HR 1 to the HUD Section 811 program, a critical resource that builds permanent supportive housing for people living with severe disabilities, including serious mental illness.
The final “continuing resolution” allocates $150 million for the Section 811 program. This is well above the $90.36 million that was allocated in the House version that passed in February. This $150 million total restores funding for development of new supportive housing units in 2011 (the House completely eliminated these funds). For FY 2011, $50 million will be available for production of new units.
More importantly, it allows for renewal of all existing rent and operating subsidies associated with the program. This includes funding for both “project-based” operating subsidies (known as PRACs) and “mainstream tenant-based voucher” renewals. PRAC renewals are needed to keep existing supportive housing units in place for current tenants. Likewise “mainstream” voucher renewal funding is needed to keep certain rental vouchers in place. The House-passed version of HR 1 failed to provide sufficient funding for these operating and rent subsidy renewals. It would have meant that current lease compliant tenants in 811 housing would have been placed at risk of losing their housing before September 30.
For programs under the McKinney-Vento Homeless Assistance Act, the final “continuing resolution” allocates $1.9 billion. This is $180 million above the level in HR 1 and provides enough funding to ensure that all current rent and operating subsidies under the Shelter Plus Care and SHP permanent housing programs are renewed this year. In addition, the final version of the “continuing resolution” allocates $50 million for new supportive housing units under the VASH program (the joint HUD-VA program that funds supportive housing for homeless veterans).
Funding for Social Security’s mandatory entitlement programs (including SSI and SSDI) are not included in the discretionary budget. However, SSA’s administrative functions are subject to the agency’s discretionary budget, known as the Limitation on Administrative Expenses (LAE). Providing sufficient funds to SSA through the LAE is critical to helping the agency keep pace with the large and growing backlog of administrative appeals that often leave claimants for SSI and SSDI eligibility waiting years for hearing decisions. For the remaining months of the current fiscal year, SSA will have to absorb a $25 million cut to its FY 2010 LAE of $10.8 billion, on top of the $21.6 million mandatory 0.2 percent rescission imposed on all agencies and programs. The final bill also imposes a $21.6 million rescission for information technology improvements.