Continuing Resolution Would Give Congress More Time to Debate 2012 Budget

With only weeks until the end of fiscal year (FY) 2011 on Sept. 30 and Congress far from completing the FY 2012 budget, lawmakers are again looking to pass a Continuing Resolution to give them more time to finalize the FY 2012 budget.   

In compliance the Budget Control Act of 2011 passed this summer to raise the debt ceiling, House Appropriations Committee Chairman Hal Rogers (R-KY) introduced a FY 2012 Continuing Resolution (CR) that includes a 1.409 percent cut to projected FY 2012 spending to meet an overall $1.043 trillion cap. Though it is unclear how the House CR would affect the Department of Education’s budget, the Pell Grant Program and other financial aid programs will most likely not be affected by this short-term spending bill.

The Budget Control Act, requires Congress maintain the $1.043 trillion spending limit on discretionary spending in FY 2012. Since certain programs, such as the Pell Grant Program, will inevitably cost more in 2012 than in 2011, maintaining FY 2011 spending levels for some programs could requires cuts to other programs.

Roger’s CR would fund federal programs through Nov. 18, giving Congress a couple of months to pass a more permanent spending bill for FY 2012. The final spending bill will likely  take into consideration the recommendations of the Debt Super Committee, which is tasked with creating $1.5 trillion in budget savings to reduce the nation’s deficit.

For the Pell Grant Program, the Budget Control Act provides "add-on" mandatory funding, making it easier to maintain the $5,550 maximum Pell in FY 2012, if discretionary funding is cut. 

While discretionary spending is often subject to negotiations in Congress, mandatory spending applies to programs required by law to support certain functions. The Pell Grant for example is funded through both mandatory and discretionary funding. Currently the $5,550 maximum award is funded through $4,860 from discretionary funds and $690 from mandatory funds.

Congress is scheduled to adjourn on Sept. 23 for the remainder of the month so the CR would have to pass both chambers and be sent to President Obama for signature by that date.