Congress and Trump Administration Strike Deal to Lift Spending Caps

Congress and the White House announced yesterday evening an agreement to lift the low federal spending caps on defense and domestic priorities by $320 billion for fiscal years (FYs) 2020 and 2021. The House will vote on the proposal this week before leaving for recess through September 9, and the Senate will likely vote next week. The deal also raises the federal debt ceiling until July 31, 2021.

The two-year budget agreement provides a significant increase for defense and domestic spending over the levels set by the Budget Control Act of 2011. The proposal will increase domestic spending above current levels by $27 billion for FY20 and $29 billion for FY21. Under the agreement, domestic programs will receive a 4.5% increase in funding over FY19 levels, which is $15 billion less than the amounts included in the House-approved spending bills.

As part of the agreement, House Democrats have promised to exclude policy riders from spending bills for the next two fiscal years. Some Democrats have expressed concerns the deal does not include restrictions on the use of funds for the construction of a border wall, and some Republicans object to the lack of spending offsets that will exacerbate the deficit.

It is critical for advocates to continue to urge Congress to provide the highest level of funding possible for affordable housing and community development. Now that congressional leadership has reached an agreement, the Senate will begin working on their spending bills. The robust spending package passed by the House earlier this year is likely the high-water mark for housing and community development programs – advocates should urge their members of Congress to fund those programs at the House-approved levels. For more details on the House bill, see NLIHC’s analysis and budget chart.

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