Analysts: Next Fiscal Year Likely to Begin With Continuing Resolution

By Jon Harper

Despite the existing agreement on topline spending in fiscal year 2017, budget experts do not expect lawmakers to pass a defense appropriations bill before the start of the next fiscal year.

“I think it’s safe to say we’ll start the year on a continuing resolution because there’s a long track record of doing that,” said Todd Harrison, director of defense budget analysis at the Center for Strategic and International Studies, during a recent panel discussion. “It may be a foregone conclusion.”

The Bipartisan Budget Act of 2015 set topline defense spending at $610 billion in fiscal year 2017, and the legislation was supposed to provide budget stability and predictability for Pentagon planners.

Roger Zakheim, a visiting fellow at the American Enterprise Institute, noted the dispute between hawkish Republicans — who want more defense spending — and fiscal conservatives in the Freedom Caucus who don’t want to boost the Pentagon’s budget without cutting other federal programs to offset it.

“The reality is the fights [and] the environment on the Hill really hasn’t changed at all even with the Bipartisan Budget Act” of 2015, he said.

“If you look at the House of Representatives right now, they’re struggling to pass a budget,” he said. “There’s about a $30 billion debate between the fiscal hawks and the defense hawks. … What that means is that despite having a majority in the House, [Republicans] are going to struggle to put in a budget that even meets the administration’s last budget request.”

Election year politics could also diminish the chances of getting a defense budget passed before Sept. 30, the end of this fiscal year. “With the presidential election coming into place … that disincentivizes anybody to move on this request,” Zakheim said.

“You’ll probably see no action on it until we get to the first quarter of the next fiscal year, in which case I think you’ll see an embrace [of what the Obama administration requested] or perhaps even an increase” depending on who is elected, he added.

A continuing resolution would maintain fiscal year 2016 funding levels until a new budget is passed. Starting the next fiscal year in such a way won’t have a big impact on overall Defense Department funding levels, but it will complicate acquisitions and delay new programs if it lasts well into 2017, analysts said.

“Because the ’17 [topline] levels are essentially the same as the ’16 levels, you don’t have this problem about a big jump” in spending getting stymied, said Mark Cancian, a senior adviser at CSIS. “The amounts aren’t that big of a deal … but when you start going six months or more then that becomes a big deal” because it has an impact on program authorities.

Photo: iStock

Topics: Defense Department, DOD Budget

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