FISCAL YEAR 2006 PRESIDENT'S BUDGET
Budget overview
February 7, 2005
On February 7, President Bush transmitted his fiscal year 2006 budget proposal to Congress, lending more detail to initiatives he outlined in his State of the Union address. The $2.5 trillion plan portends the hard fiscal reality that for the foreseeable future most every issue will be decided in the context of the budget.
- Overall discretionary spending growth for non-homeland security programs would be virtually frozen
- About 150 programs would be terminated or drastically cut, including 27 HHS programs totaling $1.9 billion and 48 education programs totaling $4.3 billion
- A total of 18 community development programs would be consolidated and cut by $1.8 billion, including community development block grants, rural housing and aid to Indian tribes
- Growth at the National Institutes of Health would be held to just over ½ percent, the lowest in more than two decades.
The president has pledged to cut the budget deficit in half by 2009, but at least for now, the government's fiscal health is worsening. The nonpartisan Congressional Budget Office just released its deficit forecast for the coming decade, projecting that the government will amass an additional $855 billion in debt between 2006 and 2015, an estimate that almost certainly understates the problem because it assumes no additional money will be spent on Iraq or Afghanistan, and excludes any costs associated with restructuring Social Security. CBO reports that tax cuts and spending enacted by Congress last year alone contributes $504 billion to the 10-year forecast.
CBO's projected deficit for this fiscal year grew to $427 billion, an increase of $15 billion over last year, even though tax receipts rose 11 percent in the first quarter of the fiscal year. Â
So much to process, so little time
The legislative work calendars published by the House and Senate make it hard to imagine how everything that has to get done will get done before the start of a new fiscal year October 1. Discounting for recesses, Congress will be working about 85 days between now and October 1, hardly enough time to develop a congressional budget resolution (overall spending plan), debate an $80 billion supplemental appropriation for Iraq and Afghanistan, provide tsunami relief aid, approve a debt ceiling increase, revise the tax structure and make previous tax cuts permanent, and pass appropriations bills required to keep the government running.Â
Congress could invoke both organizational and procedural changes to reduce the workload.  Added spending for Iraq and tsunami relief may be combined, while the debt ceiling and tax extensions could be done through a reconciliation bill (although that would require Congress to pass a budget resolution, something that has been neither quick nor easy in recent years). Lawmakers could also turn to a recent favorite—an omnibus appropriations bill—to eliminate time otherwise spent debating individual spending bills.
But even though the Republican majority is larger this year, that is no guarantee that any of these major issues will go smoothly. Factions within the Republican ranks have already begun voicing concerns, e.g. spending too high or too low, tax cuts are not big enough, etc. And in the Senate, the GOP is still five votes short of the 60 votes needed to stop a filibuster.
It seems safe to say that debate on many of these important issues could last well into 2006. Â
Department of Health and Human Services
For the programs that make up the Labor-HHS-Education appropriations bill the president's budget proposes $141.5 billion, a decrease of $2.4 billion below current funding levels. That portion of budget administered by the Department of Health and Human Services (HHS) totals $67 billion, including the following major programs.
Food and Drug Administration. – The fiscal year 2006 budget request for FDA is $1.9 billion, an increase of $81 million over current funding levels. The primary focus of the increase will be on protecting the food supply against intentional and accidental risks, drug safety, and ensuring that medical devices are safe and effective.
Health Resources and Services Administration. - The fiscal year 2006 budget proposes $6.5 billion for HRSA, a net decrease of $846 million below current funding levels. A total of $2 billion is requested for community health centers, an increase of $304 million over the current funding level, and enough to treat 16 million patients at 4,000 sites across the U.S. Maternal and child health block grants would be held to current funding levels of $724 million. Those program levels would be offset by cuts in the following areas-
                                                                                    (in millions)
           Health professions training                                   -$252
           Health community access                                    -$ 83
           Children's hospital GME                                     -$101
           Rural health                                                        -$115Â
           EMS for children                                                -$ 20
           Health care facilities                                            -$483
           Newborn hearing screening                                 -$ 13
Centers for Disease Control and Prevention. - The president's budget proposes a program level of $7.5 billion for CDC, a net decrease of $491 million below the current funding level. This includes program increases of $339 million, including expanded funding for flu vaccine, improvements in childhood immunizations, expanded global disease detection efforts and expansion of the national stockpile, with a focus on portable mass casualty treatment units. These increases are offset by reductions in construction (-$240 million), preventive health services block grants (-$131 million), state and local bioterrorism activities (-$130 million) and the stockpile of vaccines for children (-$166 million)
National Institutes of Health. - The president proposes $28.8 billion for NIH, or slightly more than ½ percent over current funding. Of the total, $1.8 billion is proposed for biodefense research, $2.9 billion for HIV/AIDS-related research, and $333 million to support the NIH "Roadmap" initiative. NIH will also continue work on a inter-Institute neuroscience initiative designed to improve the effectiveness and efficiency of research in this field. Another $26 million will be invested in developing genetically engineered mouse strains specifically for nervous system disease research; training in neuroimaging and computational biology; and specialized interdisciplinary centers that focus on animal models, cell culture, DNA sequencing and gene vectors. The proposed budget will support 38,746 projects, 400 fewer grants than in fiscal year 2005. NIH estimates the budget will fund 9,463 new and competing grants, 247 more than in fiscal year 2005, at an average cost of $347,000 per grant.
Substance Abuse and Mental Health Services Administration. - The president's budget proposes $3.3 billion for SAMHSA, a net decrease of $56 million below current funding. Funding for the substance abuse and mental health block grant programs are held steady at $1,7 billion and $433 million, respectively. The budget proposes $26 million for state grants aimed at reducing system fragmentation and increases services and support to individuals living with mental illness. The budget also proposes to continue efforts to prevent youth suicide, including programs authorized under the Garrett Lee Smith Act supporting state-wide early intervention and prevention strategies, aid to institutions of higher education, educational seminars and a national cross-site evaluation.
Agency for Healthcare Research and Quality. - The budget proposes $319 million for AHRQ, the same as this year's funding level. Focus will be on health costs, quality and outcomes, including $84 million for patient safety and $15 million for comparative effectiveness research. An estimated $50 million will be devoted to information technology investments, with an emphasis on small community and rural hospitals and health care systems
Centers for Medicare and Medicaid Services. – The president's budget includes $545.5 billion for Medicare, Medicaid and the State Children's Health Insurance program (SCHIP), an 11.4 percent increase over current program levels.
Administration for Children and Families. - The president's budget request for discretionary programs administered by ACF is $13.1 billion, a net decrease of $719 million below current funding levels. Increases in Head Start, abstinence education and faith-based initiatives are offset by reductions in community services block grants and low-income heating and energy assistance to the poor.
Administration on Aging. - The president proposes $1.4 billion for AoA, a reduction of $24 million below current funding. The request includes $162 million for the National Family Caregiver Support program, $26 million for grants to Native Americans, $54 million for health promotion and disease prevention programs and $12 million to continue the Alzheimer's state demonstration grant program.
Department of Education
For fiscal year 2006, the president is proposing $56.0 billion in discretionary appropriations for the Department of Education, a decrease of $527 million or 0.9 percent below current funding levels. This accounts for about 8 percent of the nation's $514 billion investment in education. Following are highlights of the president's proposal.
Elementary and Secondary Education. – The budget proposes $13.3 billion for Title I grants to local education agencies, an increase of $603 million to help schools implement reforms contained in the No Child Left Behind Act, and $1.5 billion for the president's new high school initiative. The budget also continues the Reading Is Fundamental Program at $25.3 million and Ready to Learn at $23.3 million. The Ready to Teach program, funded at $14.3 million in fiscal year 2005, would be eliminated under the president's proposal. The Safe Schools and Citizenship Education program would be funded at $$396.7 million, a net reduction of $464 million, or 53 percent. The request includes $88.5 million for grants to school districts for comprehensive drug and violence prevention projects, including mental health preventive and treatment services, and $87.5 million for grants to support drug prevention and school safety programs that research has demonstrated to be effective, including implementation and evaluation of additional approaches that show promise and effectiveness.
Special Education. - The president's budget proposes $12.1 billion for special education programs, an increase of $452.5 million over current funding levels. The bulk of this program, $11.0 billion, is awarded through formula grants to states, providing an average $1,599 for an estimated 6.9 million children.
Higher Education. - The budget includes $25.7 billion for student assistance programs, including $17.9 billion for Pell grants, $990.3 million for work-study programs and $6.5 billion for family education loans. For Title III-Aid for Institutional Development, the president proposes $418.5 million, slightly less than current funding. The budget includes $240.5 million for historically black colleges and universities, $95.9 million for Hispanic-serving institutions and $23.8 million for tribally controlled colleges and universities. In addition, the budget proposes to continue tribally controlled vocational and technical institutions at $7.4 million.