Budget Reconciliation 101

Now more than ever before, Americans are turning their attention to media coverage of the new Presidential Administration and Capitol Hill activities. There has certainly not been a dull moment, and we at the Ridge Policy Group are excited to see this heightened attention given to our government’s actions. 

In order for the Democrats to come out with a large victory early on, they have proposed using the reconciliation process to expedite Congressional action. The House just yesterday set up reconciliation instructions to start the process of moving a bill by a simple majority vote in the Senate. This somewhat controversial maneuver sounds more complicated than it really is. Below is a high-level explanation of the reconciliation process so that you can continue to follow the ongoing political inside baseball.

What is Budget Reconciliation?

Created by the Congressional Budget Act of 1974, Congressional Budget Reconciliation is a process whereby Congressional leaders agree to change federal spending levels and require specific Congressional Committees to come up with legislative proposals that meet the identified changes. 

The identified Committees send their proposals to Congressional leadership, where they are packaged together into one bill and given expedited consideration by the full House and Senate. This means that in the Senate, the filibuster and amendments are prohibited, so the measure only needs 51 votes to pass, leading to Democrats having enough votes to approve the measure. Typically, legislation in the Senate must go through a filibuster process, which requires 60 votes to pass.

The Democrats enjoy a majority in the Senate and House. Why use reconciliation?

Republicans and Democrats each hold 50 seats in the Senate, potentially setting the stage for gridlock. The special rules governing the reconciliation process essentially strips the rights of the minority party to delay consideration of bills (in this case the Republicans), and creates a smoother pathway for passage in the Senate.

Is this new?

No. Since 1980, Congress has used the reconciliation process over 20 times. In 2005, Republicans used it to pass the Deficit Reduction Act, which largely focused on savings from the Medicaid, Medicare and Temporary Assistance for Needy Families (TANF) programs. A reconciliation measure was also used to pass parts of the Affordable Care Act in 2010 to deal with health care and President Donald Trump’s 2017 tax-cut law. The best lobbying firms, including our team, were deeply involved in the negotiations of these laws and worked to have provisions included in the reconciliation measures.

What could this reconciliation include?

Reconciliation bills can only include items that have have an impact on federal revenue, spending, and deficits. Congress is looking to use the reconciliation process to pass a number of spending measures deemed as pandemic relief. Proposals being discussed include:

·        Funding for a national vaccine program;

·        Funding for state and local governments;

·        Extension of the popular Paycheck Protection Program (PPP);

·        Release of another round of stimulus checks for individuals;

·        Rental assistance and eviction forbearance;

·        Increasing of child tax credit;

·        Increasing of the federal minimum wage to $15; and

·        An extension of and possible increase to emergency unemployment benefits

The Ridge Policy Group is adjusting our government affairs strategies to ensure that our clients’ priorities are considered for a COVID-19 package, whether or not it is passed through reconciliation. We have been grateful for what we have been able to accomplish during these times despite unusable circumstances and look forward to continuing to support our partners.

This post was written for Ridge Policy Group, a top government affairs firm, by Becky Wolfkiel, our Director of Federal Affairs. Becky helps to develop in-depth government strategies to support our clients’ needs, including through appropriations for each fiscal year, budget resolutions, and the reconciliation process.

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Ridge Policy Group


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