Mike's Blog

I’m sure many are planning for your annual Groundhog’s Day festivities. One less thing to be concerned with this Friday is that while the prior continuing resolution (CR) that NIH operated under was in effect, had been set to expire on February 2, this has now been superseded by another CR that moves the drop-dead date to March 8 (another Friday) for NIH, with a companion CR that goes until March 1. While this gives the appearance of the whole month of February to nail down the details for a full FY24 budget, Congress has plenty of other agenda items and pressing concerns to deal with. At the same time, even though February this year conveniently offers twenty-nine days, the actual scheduled legislatives work sessions are limited with the House and Senate listing only ten working days each.

Exactly how all of this will play out is uncertain at this time. There may be emerging chatter (ruminations, lamentations, etc.) of the implications for NIH. A recent Congressional Budget office (CBO) letter to the House Budget Committee lays out the various scenarios that could arise as a result of the Fiscal Responsibility Act of 2023 (FRA). You may recall that the FRA was the resolution of the debt ceiling debate last year. While the FRA suspended the debt ceiling until January 1, 2025, it also included language concerning overall federal spending and revenue.

While I don’t recommend this reading material (unless you suffer from insomnia), there is a handy visual aid on page 3 of the CBO letter that provides possible scenarios that could play out depending on what Congress does (or does not do) between now and April 30^th. There may be some head scratching as to how a 1% sequestration in the FRA can result in larger potential sequestrations. Ah, the vagaries and nuances of federal budgeting. Bear in mind that the 1% sequestration is based on the prior FY23 enacted budget and not the FY24 CRs we are operating under. Both the Department of Veterans Affairs (which is also exempt from sequestration), and Indian Health Services received advance appropriations for FY24 in amounts higher than FY23. There are some additional considerations related to the Federal Housing Administration as well as budget authority cancellations in FY24 relative to FY23 that also add to the overall discretionary (NIH is in the category of ‘discretionary’) funding total to which the 1% is applied. Finally, the Office of Management and Budget (OMB) has some latitude in distributing the sequester.

So, with all that, bear in mind that no one knows at this point what will happen or how any of this plays out. Congress can do whatever they want, including waiving the FRA entirely (not likely, but still possible). Regardless of what you hear, NIH in general tends to follow the mantra, ‘hope for the best, but plan for the worst.’

The budget is not just a collection of numbers, but an expression of our values and aspirations.
- Jack Lew