December 20, 2013

International Affairs Budget Update, 12-20-13

1. Budget Agreement Passes both Houses

Following last week’s passage in the House by a strong bipartisan vote of 332-94, the Senate on Wednesday passed the FY14 and FY15 budget agreement (H. J. Res 59) by a vote of 64-36. The President is expected to sign the measure into law today.

As we reported last week, the budget agreement forged by Senator Patty Murray (D-WA) and Representative Paul Ryan (R-WI) revises sequester cuts and boosts discretionary spending for FY14 and FY15. The agreement raises FY14 discretionary spending to $1.012 trillion—splitting the difference between the sequestration and House level of $967 billion and the Senate level of $1.058 trillion. Non-defense discretionary spending, which includes International Affairs programs, will increase $22 billion from current levels while defense spending increases $2 billion.

Whether International Affairs programs will benefit from the $22 billion boost in non-defense discretionary spending is uncertain. The demands for additional resources for other non-defense discretionary programs and the decline in Overseas Contingency Operations (OCO) levels mean a significant increase in International Affairs funding is unlikely.

The final funding level for OCO will be a key determinant in the total funding for International Affairs programs. In recent years, Congress has used an increased OCO level to cover emergency issues beyond Afghanistan, Pakistan, and Iraq—such as the humanitarian response in Syria and embassy security. Current OCO funding is $10.6 billion, but the Administration requested only $3.8 billion due to drawdowns in the Frontline States. The House and Senate both provide $6.5 billion in their draft FY14 bills, and it is unlikely that the final OCO allocation would exceed that. Therefore, this reduction in OCO funding could result in a decrease in total International Affairs funding.

International Affairs Budget Snapshot

FY14 CR FY14 House Appropriation  FY14 Senate Appropriation  FY14 Final
$41.6 billion Base $35.4 billion
$45.7 billion
$10.6 billionOCO $6.5 billion OCO $6.5 billion OCO ??OCO
$52.2 billion $41.9 billion $52.2 billion ???


Leaders on Capitol Hill have largely reached agreement on the final FY14 appropriations allocations and are beginning to craft an FY14 omnibus appropriations bill that will be taken up by both chambers the week of January 6. The allocations are very closely held and will not be made public until the omnibus is filed in early January.  The current CR expires on January 15, 2014.

USGLC has been urging our allies in leadership and on the Appropriations Committee to utilize the $22 billion in non-defense discretionary spending and the Overseas Contingency Operations (OCO) account to provide a strong funding allocation for International Affairs program. Leaders of our National Security Advisory Council sent this letter to the Hill last week.

We will keep you updated on developments as the appropriations process moves forward.

2.     Update on Nominations

The Senate is continuing to move forward several of the President’s nominations for key leadership posts relating to International Affairs programs.  Last week the Senate confirmed 74-17 Heather Higginbottom to be Deputy Secretary of State for Management and Resources and on Monday confirmed 78-16 Anne Patterson to be Assistant Secretary of State for Near Eastern Affairs.

Yesterday the Senate Foreign Relations Committee approved the nominations of Dana Hyde to be Chief Executive Officer at the Millennium Challenge Corporation and Mark Lopes to be United States Executive Director of the Inter-American Development Bank.  Both Hyde and Lopes testified before the Committee about their nominations prior to the Thanksgiving recess.

Sarah Sewall’s nomination to be Under Secretary of State for Civilian Security, Democracy, and Human Rights could be confirmed by the Senate before the Christmas break as part of a nominations package put forward by Majority Leader Harry Reid (D-NV).  In addition to Hyde, Lopes, Sewall, and a handful of other nominations, the Senate also needs to confirm Carolyn Hessler-Radelet as Director of the Peace Corps; Daniel Yohannes to be the U.S. representative to the Organization for Economic Cooperation and Development; and Richard Stengel to be Under Secretary for Public Diplomacy.

3.     Year-End Legislative Roundup

In past few weeks Congress has acted on several key bills related to the International Affairs Budget.  A summary of this action is outlined below.

PEPFAR Reauthorization
On November 19th the House passed the PEPFAR Stewardship and Oversight Act (S. 1545) by a voice vote following Senate passage of the bill by unanimous consent the previous day. Members speaking in support of the bill during House floor debate included House Foreign Affairs Committee Chairman Ed Royce (R-CA) and Ranking Member Eliot Engel (D-NY), who co-sponsored the companion bill in the House (H.R. 3177), as well as House Minority Leader Nancy Pelosi (D-CA).  The President signed the bill into law earlier this month. The legislation, co-sponsored by Senate Foreign Relations Committee Chairman Robert Menendez (D-NJ) and Ranking Member Bob Corker (R-TN), is narrow in scope and makes no changes overall to policy provisions and funding levels, focusing instead on ensuring effective oversight of current programs. Among other provisions, the bill:

  • Extends authorities for PEPFAR until 2018 that would otherwise expire;
  • Expands and improves monitoring and reporting requirements for programs;
  • Updates requirements for annual reporting to reflect PEPFAR’s shift towards more country-owned programs;
  • Caps U.S. participation in the Global Fund to Fight AIDS, Tuberculosis, and Malaria (Global Fund) at 33%; and
  • Extends funding requirements for treatment and orphans and vulnerable children.

Africa Exports Bill
On November 21st the House Foreign Affairs Subcommittee on Africa, Global Health, Human Rights, and International Organizations approved by voice vote the Increasing American Jobs Through Greater Exports to Africa Act of 2013 (H.R. 1777), which directs the President to establish a comprehensive U.S. strategy for public and private investment, trade, and development in Africa.  By prioritizing the alignment of U.S. commercial interests with global development priorities in Africa, the legislation aims to improve the competitiveness of U.S. businesses in Africa and boost American exports to Africa by 200 percent within 10 years. “Improving the competitiveness of U.S. business in Africa,” said Subcommittee Chairman Chris Smith (R-NJ), who introduced the legislation, “is in America’s interests as well, since more prosperous Africans can afford U.S. manufactured goods.”  The legislation also calls for increasing the number of Export-Import Bank employees dedicated to expanding business development for Africa, as well as Overseas Private Investment Corporation (OPIC) staff needed to promote sustainable development in Africa and help U.S. businesses to expand into African markets. The Secretary of Commerce is also directed to ensure that at least 10 total U.S. and Foreign Commercial Service officers are assigned to U.S. embassies in Africa for each of the first five fiscal years after enactment of this Act.

Humanitarian Assistance Bill
On November 18th Representatives Chris Smith (R-NJ), Jim McGovern (D-MA), and Jeff Fortenberry (R-NE) introduced the Humanitarian Assistance Facilitation Act of 2013 (H.R. 3526). The legislation, which has broad support within the NGO development community, aims to overcome unintended consequences of U.S. counter-terrorism restrictions put in place since September 11th. Some of these regulations and restrictions have had the effect of discouraging, delaying, and interfering with the delivery of life-saving humanitarian assistance to victims located in areas where terrorists operate. The bill authorizes the delivery of humanitarian aid in places under control of sanctioned and terrorist-related groups, but with safeguards that ensure such groups will not benefit. Sixty-six humanitarian, development, and advocacy organizations have issued a statement in strong support of the legislation.

4.     2014 Calendar

Congress will convene for the second session of the 113th Congress the second week of January. Click here for the House and Senate 2014 calendars.

Dates of note for the beginning of next year include:

January 6: Senate Convenes
January 7: House of Representatives Convenes
January 20-24: Congressional Recess
January 28: State of the Union Address
January 30-31: House Republican Retreat