What’s Good, Bad, and OK in the Omnibus Bill

COMMENTARY Budget and Spending

What’s Good, Bad, and OK in the Omnibus Bill

Feb 14th, 2019 8 min read

Commentary By

Justin Bogie @JustinBogie

Senior Policy Analyst in Fiscal Affairs

David Inserra

Policy Analyst for Homeland Security and Cyber Policy

Rachel Greszler

Research Fellow in Economics, Budget and Entitlements

Congress is back at it with a last-minute, massive spending bill that no one will have time to read. Omar Chatriwala/Getty Images

Key Takeaways

Lawmakers are expected vote on the bill by Thursday evening, less than 24 hours after its release, leaving no time for a thorough debate and amendment process.

The omnibus includes a 1.9 percent pay raise for federal employees, costing roughly $3.3 billion in 2019, and more than $40 billion over the next 10 years.

Lawmakers must get serious about following the budget process that is already in place and stop this dysfunction.

Congress is back at it with a last-minute, massive spending bill that no one will have time to read.

Late Wednesday night, House and Senate negotiators released text of a nearly 1,200 page omnibus spending bill that does nothing to reduce wasteful spending and is a letdown for America’s taxpayers.

Lawmakers are expected vote on the bill by Thursday evening, less than 24 hours after its release, leaving no time for a thorough debate and amendment process.

In total, the compromise agreement provides $333 billion to fund the nine remaining Cabinet agencies and related programs through Sept. 30.

As is the case with most compromises, the bill is far from perfect. It makes no effort to rein in wasteful spending and would limit funding for Immigration and Customs Enforcement to provide detention beds.

However, the agreement could have been even worse. Unlike past omnibus bills, this legislation does not include a laundry list of add-ons and does provide additional resources for border security.

Here’s the good, the bad, and the OK of the fiscal year 2019 omnibus bill.

The Good

Disaster Funding and Other Add-Ons Not Included

It was assumed that any compromise agreement would include billions of dollars in uncapped disaster spending. In the past month, the House and Senate both pursued disaster packages of $14.2 billion and $12.7 billion respectively.

While supplemental disaster funding is sometimes warranted, neither proposal directed any funding toward Federal Emergency Management Agency’s Disaster Relief Fund, the federal government’s primary lead in disaster response efforts. Instead, much of the money would have continued to abuse the disaster spending designation by sending funding to ineffective grant programs and subsidies that have no direct role in disaster response. 

Just because the omnibus didn’t include disaster funding doesn’t mean that Congress won’t pursue a package later. But the fact that Congress is separating disaster spending from a “must-pass” spending bill is a step in the right direction. It allows for a more thorough debate and alleviates the pressure for lawmakers to vote for something they may not agree with just because it is tied to a broader funding bill. 

The omnibus also didn’t attach reauthorization language for programs such as the Harbor Maintenance Trust Fund and Violence Against Women Act programs. In the past, government shutdown threats have been exploited as an opportunity to stuff legislation full of unrelated provisions. Not doing so will allow these programs and other federal expenditures to be more fully and openly debated outside the context of a massive spending bill.

The Bad

Adheres to the Bipartisan Budget Act of 2018 Spending Levels

The Bipartisan Budget Act of 2018 increased the Budget Control Act of 2011 discretionary spending caps by $296 for fiscal year 2018-19. This omnibus adheres to the higher spending levels.

Instead of using this bill as an opportunity to exhibit fiscal restraint and roll back some of the $68 billion in fiscal year 2019 domestic spending increases, Congress has instead chosen the status quo.

With the national debt now over $22 trillion, that’s doesn’t cut it. Lawmakers must get serious about making spending reforms and putting the budget back on a path to balance. This bill should have been the time to start taking small steps toward that goal.

Uses Gimmicks to Increase Spending

Changes in Mandatory Programs are one of the most commonly used gimmicks in the appropriations process. On paper, mandatory spending is delayed, creating new savings that can be put toward unrelated discretionary spending.

In reality, the vast majority of the delayed funding would never have been spent in the first place and generated no real savings. Each year, billions of dollars in new spending is enabled through Changes in Mandatory Programs.

The largest change each year is delayed spending from the Department of Justice’s Crime Victims Fund. The bill would cap spending from the Crime Victims Fund at $3.35 billion dollars in fiscal year 2019. However, the fund would consistently carry a balance of around $13 billion, meaning that any unobligated balance above $3.35 billion can now be captured as savings and used to circumvent the Budget Control Act caps.

And the Crime Victims Fund is not the only Change in Mandatory Programs. In fiscal year 2018, changes with no real savings increased spending by nearly $18 billion.

This gimmick undermines fiscal accountability and transparency and wastes taxpayers’ money. Congress must take steps to end this practice once and for all.

$3.3 Billion Federal Pay Raise Ignores Performance While Increasing Pay Inequity

The omnibus includes a 1.9 percent pay raise for federal employees, costing roughly $3.3 billion in 2019, and more than $40 billion over the next 10 years.

This would overturn a December 2018 executive order from President Donald Trump freezing federal pay. And, for more than half of federal workers, it will serve as their second pay raise in 2019 because federal workers receive both cost-of-living increases as well as step increases based on tenure.

On average, federal employees receive $121,000 in total compensation, compared to average private-sector total compensation of $69,000. Part of this differential stems from the fact that federal workers have more education and experience, on average, but studies consistently find that federal employees receive a significant compensation premium.

While a freeze in federal pay is not the most efficient way to address this gap (primarily because the government’s highest-level employees are actually undercompensated), it is one way of chipping away at the growing inequity.

Until Congress enacts comprehensive federal compensation reforms, lawmakers should not increase the compensation gap through automatic pay raises that ignore performance. A better solution would have been to provide funding for the president’s proposed $1 billion workforce fund to attract, retain, and reward the government’s highest performers.

Limits Funding For Immigrant Detention Beds and Fails to Close Loopholes

The area of the bill with the most potential for harm is in the critical areas of immigration enforcement, particularly detention beds.

As the number of caravans, children, families, and asylum seekers has drastically risen, the administration has been handcuffed by loopholes and prevented from quickly removing many illegal immigrants. The result is that many illegal border crossers or asylum seekers are “caught and released,” and many will disappear into the public and never be seen again.

The Trump administration has attempted to limit catch and release, both at the border but also in the interior, by expanding the number of detention beds.

In this bill, Democratic efforts to set a hard cap on immigration detention were stopped, but the bill does try to push the administration to reduce the number of detention beds by limiting funding. That said, administration is allowed to transfer or reprogram funds to expand detention, but does so at the expense of other homeland security programs.

In essence, the bill forces the Department of Homeland Security to steal from other important security and preparedness missions in order to fulfill the immigration enforcement mission.

Critically, the bill fails to address the key loopholes in U.S. immigration lawthat have encouraged the drastic increases in asylum claims and families and children coming to the border. Without fixes to these loopholes and other immigration enforcement tools, border security is only a superficial fix and detention beds will always be too few.

Overall, the bill may take some steps forward on immigration, but it falls short of providing the fixes we desperately need.

Continues Congress’ Dysfunctional Budget Process

Text of the 1,169-page compromise bill was released just before midnight on Wednesday. Within 24 hours, Congress will likely have voted on it and by Friday morning, the omnibus could already be law.

Once again, Congress is ignoring its own budget rules. The House requires that text of legislation be available for at least 72 hours before a vote is held.

This is not the way the process is supposed to work. It leaves no time for lawmakers to even read the bill, let alone have a chance to debate and offer amendments to improve the legislation.

That’s just a symptom of the larger problem. The fiscal year is already more than four months old and Congress still hasn’t finalized funding. If lawmakers were doing their job and passing budget and appropriations bills on time, continuing resolutions, omnibus bills, and government shutdowns could become obsolete, or at least the exception rather than the rule.

Congress should strengthen the budget process that it has in place and provide incentives to make the process function more smoothly.

One potential option would be a “no budget, no pay” provision, in which lawmakers’ salaries are withheld when budget deadlines are missed. This could motivate them to abide by budget deadlines. Sen. Mike Braun, R-Imd., recently introduced a bill that would implement this enforcement mechanism.

The OK

Provides New Border Wall and Technology Funding

The most controversial elements of the bill are the immigration provisions.

The bill includes $1.375 billion for new border wall funding—short of what the president has requested, but which will still be put to good use in high-traffic areas in the Rio Grande Valley Sector.

It also included much-needed technology and tools that can support physical infrastructure and also support inspection of vehicles at ports of entry. Given that most dangerous drugs like Fentanyl and other opioids enter the U.S. through U.S. ports of entry, such tools are important additions.

These provisions strike a good balance between cost-effective border barriers, border security technology, and valuable infrastructure and tools at our ports of entry—yet they are unlikely to be enough to secure the border.

The bill also worryingly adds some limits on where border barriers can be placed, such as in various natural parks and some cities.

Taxpayers Deserve a Responsible and Transparent Spending Process

While the omnibus bill is not exactly what conservatives would have wanted, it could have been worse—for instance, spending even more money on wasteful programs and less money on border security.

But the process that led to this bill was a complete failure. Lawmakers must get serious about following the budget process that is already in place and stop this dysfunction. Taxpayers cannot afford year after year of bloated spending bills and budget uncertainty.

This piece originally appeared in The Daily Signal