LegiStorm

Summary:

Congressional Research Service 7-5700 www.crs.gov R44030 Summary On February 2, 2015, the Obama Administration released its budget request for FY2016. The Administration's proposed budget included $474 million in special federal payments to the District of Columbia government. An additional $286 million was requested for the Court Services and Offender Supervision Agency (CSOSA) and the Public Defender Service, two federally chartered, independent agencies that work exclusively on behalf of the District criminal justice system. The combined budget requests totaled $760 million in special federal payments. Approximately 80% ($612 million) of the President's proposed budget request for the District would be targeted to the courts and criminal justice system. The President's budget request also included $83 million in support of education initiatives. On April 2, 2015, the mayor of the District of Columbia, Muriel Bowser, submitted her proposed budget request for FY2016 to the District of Columbia Council for approval. The budget request included $474 million in special federal payments, $12.9 billion in total operating expenditures and $1.2 billion in capital outlays. The mayor's budget request did not include funding for Court Services and Offender Supervision and the Public Defender Service, which are submitted under a different account. The Council, pursuant to the requirements of the Home Rule Act, had 56 days to review, amend, and approve the District's budget. The approved budget, comprising special federal payments, local sourced operating expenses, and general provisions, was submitted to the President for transmittal to Congress for its review and approval. The mayor's budget request also included provisions that would grant the District significant autonomy over its budgetary and legislative affairs. Specifically, the act would repeal portions of the District's code governing congressional review of all acts passed by the District of Columbia Council, including referendum and initiatives. The inclusion of budget autonomy provisions in the mayor's request is part of an ongoing campaign by District officials to assert the principle of home rule. In addition to the provisions included in the mayor's budget request, the District's delegate to Congress has also introduced legislation, H.R. 552, which would grant the city budget autonomy by eliminating all congressionally imposed mandates over the District's financial affairs, including the District's budget process, financial management and oversight, and short-term borrowing. The issue of budget autonomy is currently being reviewed by the D.C. Court of Appeals based on a challenge to a 2012 voter-approved referendum amending the city's home rule charter. On July 9, 2015, the House Appropriations Committee approved the Financial Services and General Government Appropriations Act of 2014, H.R. 2786, with an accompanying report (H. Rept. 114-194). The bill recommends $678.0 million in special federal payments to the District. On July 30, 2015, the Senate Appropriations Committee reported S. 1910, its version of the Financial Services and General Government Appropriations Act for FY2016, with an accompanying report (S. Rept. 114-97). As reported, the bill recommends $688.7 million in special federal payments to the District. Like its Senate counterpart, the House committee bill includes several general provisions governing budgetary and fiscal operations and controls, including prohibiting deficit spending within budget accounts and establishing restrictions on the reprogramming of local funds. Unlike the Senate committee bill, which would restrict the use of federal funds, the House committee bill would restrict the use of both District and federal funds for abortion service, except in cases of rape or incest, and where the life of the pregnant woman would be endangered if the fetus were carried to term. The Senate committee bill also includes a provision not included in the House committee version of the FSGG bill that would grant the city budget autonomy over the expenditure of locally raised funds for FY2017. This report will be updated as events warrant. Contents Introduction 1 FY2016 Budget Request 1 The President's FY2016 Budget Request 2 District's FY2016 Budget 3 Congressional Action 4 House Committee Bill, H.R. 2995 4 Senate Committee Bill, S. 1910 5 Special Federal Payments 6 Local Operating Budget 8 General Provisions: Key Policy Issues 9 Abortion Services 9 Local Budget Autonomy 11 Tables Table 1. Status of FSGG and District of Columbia Appropriations, FY2016 1 Table 2. District of Columbia Appropriations, FY2015-FY2016: Special Federal Payments 6 Table 3. Division of Expenses: District of Columbia Funds: FY2016 8 Table 4. Date of Enactment of the D.C. Appropriations Act, FY1996-FY2015 11 Contacts Author Contact Information 16 Introduction The authority for congressional review and approval of the District of Columbia's budget is derived from the Constitution and the District of Columbia Self-Government and Government Reorganization Act of 1973 (Home Rule Act). The Constitution gives Congress the power to "exercise exclusive Legislation in all Cases whatsoever" pertaining to the District of Columbia. In 1973, Congress granted the city limited home rule authority and empowered citizens of the District to elect a mayor and city council. However, Congress retained the authority to review and approve all District laws, including the District's annual budget. As required by the Home Rule Act, the city council must approve a budget within 56 days after receiving a budget proposal from the mayor. The approved budget must then be transmitted to the President, who forwards it to Congress for its review, modification, and approval through the annual appropriations process. This typically includes subcommittee hearings, which may take place before the actual budget submission to Congress; subcommittee and committee markups in the House and the Senate; committee reports and votes; floor action; conference report consideration; and final passage. This budget review and approval process must be completed within approximately 120 calendar days before the beginning of the District's fiscal year on October 1. FY2016 Budget Request Congress not only appropriates federal payments to the District to fund certain activities, but also reviews, and may modify, the District's entire budget, including the expenditure of local funds as outlined in the District's Home Rule Act. Since FY2006, the District's appropriations act has been included in a multi-agency appropriations bill; before FY2006 the District budget was considered by the House and the Senate as a stand-alone bill. It is currently included in the Financial Services and General Government Appropriations bill (FSGG). Table 1 will track the District's appropriation for FY2016 as it moves through the congressional review process. Table 1. Status of FSGG and District of Columbia Appropriations, FY2016 Markup House Report House Passage Senate Report Senate Passage Conf. Report Conference Report Approval Public Law House Senate House Senate 6/17/2015 7/23/2015 7/9/2015 H.Rept. 114-194 7/30/2015 S.Rept. 114-97 District of Columbia appropriations acts typically include the following three components: Special federal payments appropriated by Congress to be used to meet certain statutory obligations and to fund particular initiatives or activities of interest to Congress or the Administration. The District's operating budget, which includes funds to cover the day-to-day functions, activities, and responsibilities of the government; enterprise funds that provide for the operation and maintenance of government facilities or services that are entirely or primarily supported by user-based fees; and long-term capital outlays such as road improvements. District operating budget expenditures are paid for by revenues generated through local taxes (sales and income), federal funds for which the District qualifies, and fees and other sources of funds. General provisions are typically the third component of the District's budget reviewed and approved by Congress. These provisions can be grouped into several distinct but overlapping categories, with the most predominant being provisions relating to fiscal and budgetary directives and controls. Other provisions include administrative directives and controls, limitations on lobbying for statehood or congressional voting representation, congressional oversight, and congressionally imposed restrictions and prohibitions related to social policy. It should be noted that Congress has, from time to time, included language authorizing new programmatic initiatives or amendments to the District of Columbia home rule charter in the District's Appropriations bill. For example, in 1995, Congress included language authorizing the creation of public charter schools in the District of Columbia as part of P.L. 104-134, a consolidated appropriation measure. In 2004, Congress included statutory provisions creating a school voucher program as part of the District of Columbia Appropriations, which was a component of a consolidated appropriations act, P.L. 108-199. The President's FY2016 Budget Request On February 2, 2015, the Obama Administration released its detailed budget request for FY2016. The Administration's proposed budget included $760 million in special federal payments to the District of Columbia, including court services, offender supervision and public defender services, which is $80 million more than the District's FY2015 appropriation of $680 million. The proposed $80 million increase includes additional funding for the Tuition Assistance Program, court operations, and court services. The request also includes $20 million in funding for a mix of new initiatives, including the promotion of solar energy, the redevelopment of the St. Elizabeths campus, affordable housing, and funds for the arts. Approximately 80% ($612.4 million) of the President's proposed budget request for the District would be targeted to the courts and criminal justice system. This includes $274.4 million in support of court operations; $49.9 million for Defender Services; $244.7 million for the Court Services and Offender Supervision Agency for the District of Columbia, an independent federal agency responsible for the District's pretrial services, adult probation, and parole supervision functions; $1.9 million for the Criminal Justice Coordinating Council; $40.9 million for the public defender's office; and $565,000 to cover costs associated with investigating judicial misconduct complaints and recommending candidates to the President for vacancies to the District of Columbia Court of Appeals and the District of Columbia Superior Court. The President's budget request totals $83.6 million in support of education initiatives, including $43.2 million to support elementary and secondary education, $435,000 to support the D.C. National Guard college access program, and $40 million for college tuition assistance. These amounts represent 10.9% of the Administration's budget request for the District of Columbia for FY2016. The President's budget also includes a general provision in support of budget and legislative autonomy for the District. District's FY2016 Budget On April 2, 2015, the mayor of the District of Columbia submitted a proposed budget to the District of Columbia Council. The FY2016 budget request includes $12.2 billion in operating expenditures and $1.2 billion in capital outlays. The special federal payments section of the mayor's budget request is consistent with the Administration's budget submission, excluding funding for court services and public defender offices. The mayor's budget request also includes general provisions that would grant the District greater self-governance. The act proposes to provide some level of budget autonomy in the expenditure of local funds and legislative autonomy. Specifically, the act, if approved by Congress, would amend the District's home rule charter by removing language that currently subjects the District's general fund budget to the congressional appropriations process. Also, the proposed amendment would make the annual operating/local budget effective upon passage by the District Council. The mayor would be directed to submit to the President for transmittal to Congress that portion of the budget with respect to special federal payments for its review and approval. The amendment would only require the mayor to notify the Speaker of House and the President of the Senate regarding that portion of the budget covering the expenditure of local funds. No congressional action would be needed. In addition, the mayor's budget request for FY2016 includes provisions intended to advance the principles of home rule. The mayor's proposal would enact the Local Budget Autonomy Amendment Act of 2012; shorten the congressional review period (which currently allows Congress 30 legislative days to review non-criminal-code legislation passed by the District of Columbia Council and 60 days for legislation related to criminal offenses, procedures, and prisoners) by eliminating language that excludes Saturdays, Sundays, holidays, and any day on which neither chamber is in session because of an adjournment sine die, a recess of more than three days, or an adjournment of more than three days beginning on the day the legislation is transmitted to the House or Senate; and no longer subject proposed charter amendments to the 35-day congressional review period. As a fallback position, should Congress fail to enact the mayor's proposal, the mayoral budget request also includes language that would allow for the expenditure of local funds as outlined in an approved budget request act or continuing budget resolution if Congress fails to enact a District appropriations at the beginning of a fiscal year starting with FY2017. This provision would be void if Congress approves amendments to the home rule charter granting the District budget autonomy or if Congress enacts the Local Budget Autonomy Amendment Act of 2012, as passed by the District of Columbia Council and ratified by District voters. Congressional Action In the coming weeks and months, Congress will continue review the District's budget and consider additional federal assistance to the District as part of the appropriations process for FY2016. This section of the report will discuss congressional action as it occurs. House Committee Bill, H.R. 2995 On July 9, 2015, the House Appropriations Committee approved the Financial Services and General Government Appropriations Act of 2014, H.R. 2995, with an accompanying report (H.Rept. 114-194). The bill included $678.0 million in special federal payments to the District. This amount is $1.63 million less than appropriated for FY2015, $81.8 million less than requested by the Obama Administration and $10.7 million less than recommended by the Senate committee bill. The bill does not include funding for the District's Water and Sewer Authority, and recommends a substantial decrease in the amount proposed to be appropriated for the Resident Tuition Support (college access) program ($20 million less than the amount requested by the Administration and $10 million less than appropriated in FY2015). The bill also recommends $45 million in funding to support the District of Columbia Public Schools ($15 million), public charter schools ($15 million), and private school vouchers ($15 million). General Provisions Like its Senate counterpart, the House committee bill includes several general provisions governing budgetary and fiscal operations and controls, including prohibiting deficit spending within budget accounts, establishing restrictions on the reprogramming of funds, and allowing the transfer of local funds to capital and enterprise fund accounts. In addition, the bill would require the city's Chief Financial Officer to submit a revised appropriated funds operating budget for the District public schools within 30 days after the passage of the bill. The House committee bill also includes several general provisions relating to statehood or congressional representation for the District, including provisions that would continue prohibiting the use of federal funds to support or defeat any legislation being considered by Congress or a state legislature; cover salaries, expenses, and other costs associated with the office of Statehood Representative and Statehood Senator for the District of Columbia; and support efforts by the District of Columbia Attorney General or any other officer of the District government to provide assistance for any petition drive or civil action seeking voting representation in Congress for citizens of the District. Unlike the Senate committee bill, H.R. 2995 would restrict the use of both District and federal funds for abortion service, except in cases of rape or incest, and where the life of the pregnant woman would be endangered if the fetus were carried to term. The bill also includes a provision that would prohibit the use of federal funds to enact any law that would decriminalize or regulate the use of marijuana. In addition, the bill would continue to prohibit the use of federal funds to administer a needle exchange program. Senate Committee Bill, S. 1910 On July 30, 2015, the Senate Appropriations Committee reported S. 1910, its version of the Financial Services and General Government Appropriations Act for FY2016, with an accompanying report (S. Rept. 114-97). As reported, the bill recommends $688.7 million in special federal payments to the District. This amount is approximately $9.1 million more than appropriated for FY2015, and $71.1 million less than requested by the Administration. The bill includes $28.4 million less in funding for court operations than requested by the Administration, but only $900,000 less than appropriated in FY2015. It would appropriate $1.8 million less than the President's FY2014 request, for elementary and secondary education initiatives. These funds would be allocated among three specific initiatives: public school improvements ($15 million), support for public charter schools ($15 million), and funding a private school voucher program ($15 million for evaluation and administration activities). The Senate report accompanying the bill noted that there were sufficient unexpended funds available from pervious appropriations to meet the needs of the program. General Provisions The Senate committee bill's general provisions mirrored some of the language included in the House committee bill. Like the House committee bill, S. 1910 includes provisions governing budgetary and fiscal operations and controls. It also includes provisions restricting or prohibiting the use of federal funds to support District statehood or congressional voting representation and includes provisions that would continue prohibiting the use of federal funds to support or defeat any legislation being considered by Congress or a state legislature; cover salaries, expenses, and other costs associated with the office of Statehood Representative and Statehood Senator for the District of Columbia; and support efforts by the District of Columbia Attorney General or any other officer of the District government to provide assistance for any petition drive or civil action seeking voting representation in Congress for citizens of the District. The bill also included changes in two provisions that city officials have sought to eliminate or modify. The bill would continue the prohibition against the use of federal funds to provide abortion services; and maintain the current prohibition on the use of federal funds to support a needle exchange program. The Senate committee bill includes provisions not included in the House Committee version of the FSGG bill. The Senate measure would grant the city budget autonomy over the expenditure of locally raised funds for FY2017. Specifically, the Senate measure would grant the District the authority to spend local funds if Congress failed to pass a continuing resolution or enact a federal appropriation authorizing the expenditure of local funds before the start of the District's 2017 fiscal year. The Senate Committee bill also includes provisions that would amend the District's Opportunity Scholarship Program by establishing additional certification requirements for private elementary and secondary schools participating in the scholarship program; and amend the District's college access program by reducing the household income threshold for resident tuition assistance grants. Special Federal Payments Both the President and Congress may propose financial assistance to the District in the form of special federal payments in support of specific activities or priorities. As noted in the sections above, the Obama Administration budget proposal for FY2016 includes a request for $760 million in special federal payments for the District of Columbia. Table 2 shows details of the District's federal payments, including the FY2015-enacted amounts, the amounts included in the President's FY2016 budget request, the amounts included in the budget approved by the city, the amounts recommended by the House and Senate Appropriations Committees, and the final amounts appropriated. Table 2. District of Columbia Appropriations, FY2015-FY2016: Special Federal Payments (in millions of dollars) FY2015 Enacted FY2016 Admin. Request FY2016 Mayoral Request FY2016 House Committee FY2016 Senate Committee FY2016 Enacted Resident Tuition Support 30.000 40.000 40.000 20.000 30.000 Emergency Planning and Security 12.500 14.900 14.900 12.500 13.000 District of Columbia Courts 245.110 274.401 274.401 259.100 246.000 Defender Services 49.890 49.890 49.890 49.890 49.890 Court Services and Offender Supervision Agency 234.000 244.763 —-a 242.750 242.000 Public Defender Service 41.231 40.889 —-a 40.889 40.889 Criminal Justice Coordinating Council 1.900 1.900 1.900 1.900 1.900 Judicial Commissions 0.565 0.565 0.565 0.565 0.565 Water and Sewer Authority 14.000 24.300 24.300 0.000 14.000 School Improvement 45.000 43.200 43.200 45.000 45.000 Public Schools 15.000 20 20 15.000 15.000 Public Charter Schools 15.000 20 20 15.000 15.000 Education Vouchers-linked activities 15.000 3.200 3.200 15.000 15.000 D.C. National Guard 0.435 0.435 0.435 0.435 0.435 D.C. Committee on Arts and Humanities — 1.000 1.000 — — Climate Risk Management — 0.750 0.750 — — Mass Transit Innovation — 1.000 1.000 — — Supportive Housing — 6.000 6.000 — — Solar Power Initiative — 1.000 1.000 — — St. Elizabeths Hospital Campus Redevelopment — 9.800 9.800 — — HIV/AIDS Prevention 5.000 5.000 5.000 5.000 5.000 Special Federal Payments (total) 679.631 759.793 474.141 678.029 688.679 Sources: FY2015 Enacted is taken from the President's FY2016 budget request. FY2016 amounts were taken from President's FY2016 budget documents, the District's 2015 Budget Request Act for FY2016, and House and Senate Appropriations Committee reports (H.Rept. 114-194 and S.Rept. 114-97). Columns may not equal the total due to rounding. Not included in the mayor's budget request. This is a federally chartered entity working exclusively on behalf of the District. Its budget request is submitted under a separate account. Local Operating Budget As noted previously, the District's General Fund Budget for FY2016, which was released by the mayor on April 2, 2015, totaled $12.9 billion, including $11.1 billion for operating expenses and $1.8 billion for enterprise funds (Table 3). These expenditures, which are supported by locally raised revenues, must be approved by Congress. Under the District's Home Rule Act, Congress retains the power to review and approve all legislative acts of the District government, including its annual budget. Table 3. Division of Expenses: District of Columbia Funds: FY2016 (in millions of dollars) District House Senate Final General Fund Government Direction and Support 798.611 798.611 798.611 Economic Development and Regulation 534.865 534.865 534.865 Public Safety and Justice 1,295.583 1,295.583 1,295.583 Public Education 2,225.104 2,225.104 2,225.104 Human Support Services 4,441.995 4,441.995 4,441.995 Public Works 768.921 768.921 768.921 Financing and Other 1,088.281 1,088.281 1,088.281 Total General Operating Expenses 11,153.360 11,153.360 11,153.360 Enterprise Funds WASA 541.605 541.605 541.605 Washington Aqueduct 62.728 62.728 62.728 Lottery 220.000 220.000 220.000 Retirement Board 32.302 32.302 32.302 Convention Center 129.670 129.670 129.670 Housing Finance Agency 10.798 10.798 10.798 University of D.C. 150.459 150.459 150.459 Library Trust Fund 0.017 0.017 0.017 Unemployment Insurance Trust Fund 235.000 235.000 235.000 Housing Production Trust Fund 100.000 100.000 100.000 Tax Increment Financing 64.256 64.256 64.256 Baseball Fund 67.507 67.507 67.507 Repayment of PILOT 18.741 18.741 18.741 Not-for-Profit Hospital Corporation 129.000 129.000 129.000 Health Benefit Exchange Authority 32.513 32.513 32.513 Total Enterprise Funds 1,794.596 1,794.596 1,794.596 Total Operating Expenses 12,947.956 12,947.956 12,947.956 Capital Fund Capital Construction 1,772.734 1,772.734 1,772.734 —Rescissions 730.968 730.968 730.968 Total Capital Outlay 1,041.766 1,041.766 1,041.766 Source: District of Columbia Fiscal Year 2016 Budget Request Act as passed the District of Columbia Council and H.Rept. 114-194 and S.Rept. 114-97. General Provisions: Key Policy Issues Abortion Services The public funding of abortion services for District of Columbia residents is a perennial issue debated by Congress during its annual deliberations on District of Columbia appropriations. District officials have cited the prohibition on the use of District funds as another example of congressional intrusion into local matters. Since 1979, with the passage of the District of Columbia Appropriations Act of 1980, P.L. 96-93 (93 Stat. 719), Congress has placed some limitation or prohibition on the use of public funds for abortion services for District residents. From 1979 to 1988, Congress restricted the use of federal funds for abortion services to cases where the woman's life was endangered or the pregnancy resulted from rape or incest. Under these circumstances, the District was free to use District funds for abortion services. When Congress passed the District of Columbia Appropriations Act for FY1989, P.L. 100-462 (102 Stat. 2269-9), it restricted the use of District and federal funds for abortion services to cases where the woman's life would be endangered if the pregnancy were taken to term. The inclusion of District funds and the elimination of rape or incest as qualifying conditions for public funding of abortion services were endorsed by President Reagan, who threatened to veto the District's appropriations act if the abortion provision was not modified. In 1989, President George H.W. Bush twice vetoed the District's FY1990 appropriations act over the abortion issue. He signed P.L. 101-168 (103 Stat. 1278) after insisting that Congress include language prohibiting the use of District revenues to pay for abortion services except in cases where the woman's life was endangered. The District successfully sought the removal of the provision limiting District funding of abortion services when Congress considered and passed the District of Columbia Appropriations Act for FY1994, P.L. 103-127 (107 Stat. 1350). The FY1994 act also reinstated rape and incest as qualifying circumstances allowing for the public funding of abortion services. The District's success was short-lived, however. The District of Columbia Appropriations Act for FY1996, P.L. 104-134 (110 Stat. 1321-91), and subsequent District of Columbia appropriations acts, limited the use of District and federal funds for abortion services to cases where the woman's life was endangered or cases where the pregnancy was the result of rape or incest. In FY2010, with the passage of P.L. 111-117, Congress lifted the prohibition on the use of District funds for abortion services, but maintained the restriction on the use of federal funds for such services except in cases of rape, incest, or a threat to the life of the woman. The position was reversed with the passage of the appropriations acts for FY2011 (P.L. 112-10), FY2012 (P.L. 112-74), FY2013 (P.L. 113-6), FY2014 (P.L. 113-76), and FY2015 (P.L. 113-235). Those acts included provisions restricting the use of both federal and District funds for abortion services, except in instances of rape, incest, or the woman's life was endangered if the pregnancy was carried to term. During the 112th Congress, two bills were considered in the House that would have banned or restricted the provision of abortion services in the District of Columbia. On May 4, 2012, the House passed H.R. 3, the No Taxpayer Funding for Abortions Act. The measure included a provision (Section 309) that would have permanently prohibited the use of federal and District funds for abortion services, except in instances of rape, incest, or a threat to the life of the woman. On June 17, 2012, the House Judiciary Committee ordered reported H.R. 3803, the District of Columbia Pain-Capable Unborn Child Protection Act. The bill would have permanently banned doctors and health facilities from performing abortions in the District after the 20th week of pregnancy, except when the pregnancy would result in the woman suffering from a physical disorder, injury, or illness that endangers her life. It would have imposed fines and imprisonment on doctors who violated the act and would have allowed the pregnant woman, the father of the unborn child, or maternal grandparents of a pregnant minor to bring a civil action against any person who performed an abortion after the 20th week of pregnancy. The act would have required any physician that performed an abortion to report specific information to the relevant health agency in the District, including post-fertilization age of the fetus and the abortion method used. The District health agency would have been required to compile such information and issue an annual report to the public. The District's delegate to Congress, Eleanor Holmes Norton, though not allowed to testify before the committee, spoke out against the measures as an infringement on home rule. During consideration of the District of Columbia appropriations measures for FY2013 Congress lifted the restriction on the use of District funds for abortion services. However, in passing the District's FY2014 and FY2015 appropriations it reinstituted restrictions on the use of both District and federal funds for abortion services. The Obama Administration's FY2016 request includes a provision that would continue to prohibit the use of federal funds for abortion services except in cases of rape, incest, or when the woman's life would be endangered if the pregnancy were carried to term, but does not include language that would restrict the use of District funds for abortion services. The mayor's budget request proposal does not include abortion services provisions. The House Appropriations Committee bill, H.R. 2995, would continue to prohibit the use of federal and District funds for abortion services, except in cases of rape or incest or when the life of the pregnant woman would be endangered if the fetus was carried to term while the Senate Appropriations Committee bill, S. 1910, would restrict the use of federal, but not District, funds for abortion services except in cases of rape, incest, or when the life of the pregnant woman would be endangered if the fetus was carried to term. Local Budget Autonomy District of Columbia political leaders have consistently expressed concern that Congress has repeatedly delayed passage of the appropriations act for the District (in which Congress approves the city's budget) well after the start of the District's fiscal year. The city's elected leaders contend that delay in Congress's approval of its budget hinders their ability to manage the District's financial affairs and negatively affects the delivery of public services. A review of recent history reveals that approval of th