1.  State-Foreign Operations Bill Moves Forward in Senate

With the House out of session this week the Senate Appropriations Committee took up its twelfth and final FY17 spending bill, approving the State-Foreign Operations (SFOPS) bill, which funds 96% of the International Affairs Budget.

On Tuesday, the State-Foreign Operations Subcommittee quickly approved the bill and on Wednesday the full Committee approved the bill unanimously. As previously reported, the Senate’s total allocation of $52.1 billion includes $37.2 billion in base funding and $14.9 billion in Overseas Contingency Operations (OCO) funding. The total allocation is $600 million (1%) below the FY16 enacted level, though it is $100 million above the House allocation.

State-Foreign Operations Snapshot

* CBO’s re-estimate of the Administration’s request

Notably, the bill includes an increase in funding for Israel and establishes a Near East and Africa Relief and Recovery Fund to help support areas in the Middle East and Africa recovering from extremist control. The bill also maintains funding to address the refugee crisis at current spending levels. Additionally, the bill:

Boosts Funding for Diplomatic Security, Development Assistance, and Global Health

• Diplomatic and Embassy Security: The bill provides $6.1 billion for embassy security, fully funding the Administration’s request.

• Development Assistance: The Senate bill fully funds the Administration’s request for this account, providing a $179 million increase from FY16.

• Global Health Programs: The bill increases funding by $162 million—2% above current levels and $89 million more than requested.

Cuts Security and Humanitarian Assistance, but Provides More than Administration Requested

• International Security Assistance: The bill provides $8.32 billion for these programs, approximately $500 million below the enacted FY16 level, but $215 million more than requested. As noted above, the bill also includes a $300 million increase in funding for Israel.

• Humanitarian Assistance: The bill maintains level funding for the Migration and Refugee Assistance and Emergency Migration and Refugee Assistance programs but cuts funding for International Disaster Assistance by $400 million. With this cut, the combined total for humanitarian assistance is down from FY16 but still about $700 million above the requested level. The bill also includes $400 million in transfer authority should additional funding be needed.

Cuts Funding for Multilateral Assistance

• Multilateral Assistance: The bill provides $2.34 billion for multilateral assistance, $277 million less than provide in FY16 and $275 million less than requested.

Provides Mixed Outcome for Other Accounts

• Economic Support Fund: The bill holds this funding flat at the FY16 level, but provides $1.8 billion less than requested.

• UN Peacekeeping and International Organizations: The bill funds UN Peacekeeping and contributions to international organizations 1% below the requested level and slightly below current levels.

Like the House State-Foreign Operations bill, the Senate bill contains a number of controversial policy riders and funding restrictions, including a prohibition on funding the Green Climate Fund and codification of the Mexico City Policy (both of which were struck during the full Committee markup as mentioned below), which prohibits federal funding for foreign NGOs that provide abortion services.

Full Committee Markup Summary

During the full Committee markup, both Senators Lindsey Graham (R-SC) and Patrick Leahy (D-VT), Chairman and Ranking Member of the Subcommittee respectively, noted the many global challenges facing the U.S. and the need for significantly more funding for international affairs programs in order to strengthen America’s global leadership. In fact, Senator Graham mentioned that he is working with Senate Democrats and the Administration on a possible supplemental spending package that would significantly increase funding to address the threat of violent extremism in the Middle East and Africa.

Over the course of the markup, a number of amendments were offered, including several related to Iran and Cuba. Other amendments of note include:

• A Manager’s Amendment making technical and non-controversial changes to the underlying bill. Passed by voice vote.

• An amendment offered by Senator Jeanne Shaheen (D-NH) to increase family planning funding at the State Department and USAID by $124 million, restore $37.5 million in funding to UNFPA, and permanently repeal the Mexico City Policy. Passed 17-13, with all Democrats and three Republicans (Senators Susan Collins (R-ME), Lisa Murkowski (R-AK), and Mark Kirk (R-IL)) supporting it.

• An amendment offered by Senator Jeff Merkley (D-OR) to eliminate the prohibition on funding for the Green Climate Fund and to provide $500 million for the Fund. Passed by voice vote.

In addition, a few notable amendments were offered but withdrawn or only discussed, including:

• An amendment offered by Senator Chris Coons (D-DE) to restore funding to UNESCO. Withdrawn.

• An amendment discussed but not offered by Senator James Lankford (R-OK) to enforce the 25% cap on UN peacekeeping dues.

Next Steps

Given that the Senate has less than 30 days left on the legislative calendar before the election, we are unlikely to see the State-Foreign Operations bill move any farther through the legislative process. On the House side, appropriators are committed to re-scheduling both the Subcommittee and full Committee markup of the spending bills after the July 4^th recess.

With so little time left on the legislative calendar, the question now becomes when Congress will pass a Continuing Resolution (CR) before the fiscal year ends on September 30^th. Regardless of the timing of the vote, which usually occurs in September, it is likely that the CR would fund the government through at least late November or early December, with a possible omnibus in late December.

2.  Zika Funding Stalls in Senate

On Tuesday Senate Democrats blocked the Zika supplemental conference report from moving forward by a vote of 52-48, delaying any deal on funding to combat the virus until at least next month. Senator Joe Donnelly (D-IN) was the only Democrat to vote for the conference report and Senators James Lankford (R-OK) and Mike Lee (R-UT) joined Democrats in voting no. Majority Leader Mitch McConnell (R-KY) also voted no in order to ensure he could bring the measure back up for a vote in the coming weeks. The procedural motion required 60 votes to move forward.

As we reported last week, the funding package—which includes $175 million for the State Department and USAID—has been caught up in several contentious issues, including Democrats’ criticism that the $1.1 billion package falls too short of the President’s $1.9 billion request, controversial policy riders, and objection to the bill being paid for by cuts to Obamacare and remaining Ebola balances. The Senate is expected to reconsider the legislation when it returns from the July 4 ^th recess.

3.  Foreign Aid Transparency Bill One Step Closer to President’s Desk 

The Foreign Aid Transparency and Accountability Act moved one step closer to the President’s desk this week when the Senate passed the bill by unanimous consent. The legislation, H.R. 3766, authored by Representatives Ted Poe (R-TX) and Gerry Connolly (D-VA) and shepherded through the Senate by Senators Marco Rubio (R-FL) and Ben Cardin (D-MD), ensures that U.S. foreign assistance programs continue to be effective, accountable, and results-driven. USGLC released a statement applauding Congress for working to build upon the game-changing reforms to foreign assistance programs that have taken place over the last decade.