Republicans gave back hundreds of millions that the House had previously cut. Rare spending deal shapes up on Hill

A spending package of more than $182 billion took final shape late Monday after an intense week of House-Senate negotiations that posed a first test of how the two political parties will implement appropriations caps agreed to in the August debt accord.

Republicans gave back more than $1 billion that the House had previously cut from food programs at home and overseas, even as the GOP betrayed its own appetite for increased science and infrastructure funding. Democrats protected Amtrak and community policing priorities, yet in a blow to Wall Street reforms, were forced to accept a one-third cut from President Barack Obama’s budget request for the Commodity Futures Trading Commission.


Among major accounts, $6.62 billion is provided for the Special Supplemental Nutrition Program for Women, Infants and Children, about $570 million more than the House approved in June. The National Science Foundation is promised an estimated $7 billion - $173 million above 2011. And while highway spending will drop from 2011 levels, the $39.1 billion cap compares with the much-tighter $27 billion ceiling first recommended by the House Appropriations Committee.

Filling over 400 pages, the conference report covers five Cabinet departments together with major science agencies and by filing Monday night, the leadership hopes to take the bill to the House floor Thursday.

Attached to the measure is a stopgap spending resolution that will keep the rest of the government operating through Dec. 16, and the goal is complete passage by Friday, when the current continuing resolution expires.

House Appropriations Committee Chairman Hal Rogers (R-Ky.) welcomed the agreement as a “bipartisan compromise that will prevent a potential government shutdown, support important programs and services that the American people rely on, and make hard but necessary cuts to help rein in the nation’s deficit. …We’ve cut total discretionary spending for the second year in a row – a remarkable achievement.”

Indeed, in keeping with the August debt-limit agreement, the bill continues the downward pressure on discretionary spending — and on balance, appears about $3 billion under the amount comparable accounts were at last year. But a big part of that savings is eaten up by $2.3 billion in increased disaster aid following on the severe storms of this past year.

House Speaker John Boehner (R-Ohio) still appears nervous about how to deal with that portion of the August agreement, which set a $1.043 trillion ceiling on discretionary spending but allowed for adjustments to deal with disasters. Boehner and Majority Leader Eric Cantor (R-Va.) promised to keep faith with this agreement, but it’s almost certain now that disaster costs will push spending up to or above the $1.050 trillion spending ceiling for 2011.

For this reason, the House leadership opted to scuttle plans to include the Department of Homeland Security budget in the package since that would entail dealing with billions more for the Federal Emergency Management Agency disaster aid account. Already, a solid block of conservatives are upset about the August concessions on spending, and this week’s House floor debate comes at a delicate moment given the fact that the joint deficit supercommittee — also born in August — is struggling to show some progress toward putting a dent in the growing federal debt.

Without Homeland Security, the five departments that remain in the bill are Agriculture, Justice, Commerce, Transportation and Housing and Urban Development. In addition, NASA is covered by the bill alongside the NSF. And the CFTC finds itself caught in the same mix because the House has traditionally funded it as part of the annual agriculture appropriations bill.

Obama had sought $308 million for 2012 in light of Wall Street reform legislation last year and the commission’s increased role in overseeing the derivatives market. But under pressure from House Republicans, the agreed-upon amount is $205.3 million, a virtual freeze at current appropriations levels.

“We have seen the results of an ill-funded and ill-equipped regulator. It isn’t a pretty picture,” Bart Chilton, a Democratic member of the CFTC told POLITICO. “Congress can fund our agency, and we can do the job they have instructed us to do, or we will have to pick and choose priorities. We certainly can’t do it all without the needed resources.”

“Not funding the CFTC is like taking the police off the streets in a high-crime area, which is what Wall Street is,” said Dennis Kelleher, president of Better Markets, a nonprofit financial watchdog.

“Risky trading in dark markets is highly profitable to Wall Street and very expensive for every other person in America. They got billions in bonuses, and we got the bill for trillions of dollars to clean up their mess. The only way to prevent them for doing that again is to make sure that the CFTC has the funds to do their job.”

At the same time — as if throwing off the shackles of their April budget — House Republicans used the new less restrictive spending caps to add money for their own priorities. Science investments were a big winner, even to the point where the agreement went beyond the amounts either the House or Senate had previously recommended.

For example, funding for science and research within the National Institute of Standards and Technology is set at $567 million, a 12 percent increase over 2011 and more than either chamber had proposed previously. The NSF total is a second such case that exceeds both the House and Senate bills.

While still less than the Senate wanted, NASA science funding will also grow by about $155 million above 2011 in what are tight budget times. And the agreement preserves $529 million for a new space telescope project that had been not funded in the House bill.

Elsewhere within the National Oceanic and Atmospheric Administration, Republicans blocked the White House’s request for $322 million to create a new climate service. But total NOAA funding is also up over 2011 and includes substantial investments in new polar weather satellites.

In the case of transportation, the House had shunned so-called TIGER or National Infrastructure Investments, but the agreement now allows $500 million. The Senate lost in its bid to keep alive new spending for high-speed rail, but Amtrak survived with an estimated $1.42 billion or about $294 million more than House Republicans had first recommended.

Beyond the CFTC, new rules proposed by the Food and Nutrition Service to upgrade the health standards for meals served in public schools were a battleground for both houses.

The final language shows that a Senate-passed white potato amendment survived together with new language added by negotiators to help pizza makers market their product to schools by giving added credit for the vegetable content of tomato paste.

FNS has proposed that tomato paste be measured by its actual volume—two tablespoons on a typical slice. The language forbids any such change and keeps intact a much more generous credit today that multiplies those two tablespoons into eight, the equivalent of half a cup or one serving.

In a new twist, the vegetable wars have even drawn the attention of the national security non-profit Mission: Readiness, whose retired military members are concerned about obesity hurting future recruits.

“It doesn’t take an advanced degree in nutrition to call this a national disgrace,” said Amy Dawson Taggart, director of the organization “We appear to be reliving the past battles over ketchup as a vegetable. If schools – or industry lobbyists – want to count pizza as a vegetable, they should make a pizza that meets the vegetable standards, not tamper with the standards to create a pizza loophole.”

At the same time, a Senate-backed bid to expand mortgage credit for high-priced housing markets — such as the East Coast and in California — met with only partial success.

For Federal Housing Administration-backed loans, the high limits of $729,750 rather than $625,000 will be authorized for two years. But House Republicans balked at doing the same for government-sponsored enterprises or the Veterans Affairs Department.