President Signs Six-month CR; OMB Issues Spending Guidance that Assumes NIH/NEI Funding at the FY2012 Level

President Signs Six-Month CR; OMB Issues Spending Guidance that Assumes NIH/NEI Funding at the FY2012 Level

Legislative Update
October 1, 2012

On Friday, September 28, President Obama signed the six-month Continuing Resolution (CR, House Joint Resolution 117) that funds most government operations at the Fiscal Year (FY) 2012 funding level until March 27, 2013. The CR, which avoids the threat of a government shutdown when FY2013 begins on October 1 since Congress did not pass appropriations bills, was passed by the Senate on September 22 and the House on September 13.

The Office of Management and Budget (OMB) also issued spending guidance on September 28. Although the CR had an across-the-board spending increase of 0.612 percent, the OMB guidance indicates that each federal agency will only receive that increase if a request is made for this additional funding. At this time, it is unclear whether the Department of Health and Human Services (DHHS) plans to make such a request on behalf of some or all of its agencies, including the National Institutes of Health (NIH). Absent that request, NIH and the National Eye Institute (NEI) would be funded during the six-month CR at the FY2012 level, or $30.64 billion and $702.7 million, respectively. This assumes that the NIH’s Office of AIDS Research will not transfer $8.2 million from the NEI due to the dissolution of the Cytomegalovirus (CMV) retinitis clinical trials, as proposed in the President’s FY2013 budget and the Senate’s FY2013 Labor, Health and Human Services, and Education (LHHS) spending bill.

The CR, however, does not alter the sequester-the automatic budget cuts to both defense and nondefense discretionary spending set to take effect on January 2, 2013. Without Congressional action before the end of 2012, nondefense discretionary programs, including NIH and NEI funding, will be cut by at least 8.2 percent, or $2.518 billion and $57.6 million, respectively, per a September 14 report issued by the OMB, which was mandated by the Sequester Transparency Act.