White House Confirms FY2014 Budget Request Will be Late, But Not How Late

One of the worst kept secrets in Washington in the past couple of weeks has been that the Obama Administration will miss the February 4, 2013 deadline for submitting its FY2014 budget request to Congress.  By law, the request should be submitted on the first Monday in February.  It has been clear for weeks that could not happen, but the White House declined to make the delay official until now.

On Friday, however, acting Office of Management and Budget (OMB) Director Jeffrey Zients told House Budget Committee chairman Paul Ryan (R-WI) that it would not be submitted on schedule.   He did not say when it would be released, however.  Widespread rumors are that it will not be ready until March.

A House aide was quoted by The Hill newspaper as complaining this is the fourth time in five years that the budget request will be late.   He failed to note that Congress has not completed its work on a budget by its legal deadline, October 1 (when new fiscal years begin), in recent memory.  In fact, the budget for the current fiscal year, FY2013, remains in limbo.  The government is currently operating under a Continuing Resolution (CR) that, in general, funds agencies at their FY2012 levels.  The CR lasts until March 27, half way through the fiscal year, meaning that agencies will have to cope with whatever spending changes are required in the span of just 6 months rather than 12.

With resolution of the sequester, the debt limit, and FY2013 funding still up in the air, it is no surprise that the executive branch is having trouble formulating the budget request for the future, never mind sorting out how to handle the rest of this fiscal year.

Deputy Secretary of Defense Ashton Carter issued a memo last week entitled “Handling Budget Uncertainty in Fiscal Year 2013” instructing the department on how to prepare for the possibility that the CR will be extended for the entirety of FY2013.  “Because most operating funding was planned to increase from Fiscal Year (FY) 2012 to FY2013, but is instead being held at FY2012 levels under the CR, funds will run short at current rates of expenditure if the CR continues through the end of the fiscal year in its current form,” according to a copy of the memo posted by the publication Government Executive.

Meantime, Politico reports that some House Republicans, including House Republican Conference Chairwoman Cathy McMorris Rodgers (R-WA), are “seriously entertaining dramatic steps” including a government shutdown to demonstrate their insistence that government spending be cut.   The Congressional Research Service (CRS) has a useful report on government shutdowns, including an explanation of the twin shutdowns in 1995 and 1996 when House Republicans under the leadership of then-House Speaker Newt Gingrich and President Bill Clinton clashed over spending and the debt limit.  First was a 5-day shutdown between November 13-19, 1995, and then a 21-day shutdown between December 15, 1995 and January 6, 1996.  The latter is the longest government shutdown on record.

The ominous political clouds on the horizon make the New Year’s Eve “fiscal cliff” debate seem like a cakewalk.  On New Year’s Eve, Congress punted on the sequester, simply delaying it for two months – to March 1.  The United States already hit the $16.4 trillion debt ceiling and the Treasury is paying bills with money that it should be putting in federal employee retirement accounts and other such “emergency” measures.   They expect to exhaust those methods by the end of February.   The President today demanded that Congress increase the debt limit, but some House Republicans are threatening to let the government default, though others prefer the government shutdown path.

In such an environment, it is hardly surprising that the request for FY2014 will be late.