NASL Article Details



General Announcement

FY2020 Budget Deal Signed into Law by President Trump

NASL, 8/14/2019


On August 1st, Congress passed and the President signed into law a two-year budget deal for fiscal year (FY) 2020 that raises government spending caps and suspends the debt ceiling through July 2021. As a result, the Senate will now be able to move forward on appropriations bills that need to be passed before the start of the next fiscal year on October 1, 2019, to fund government operations and therefore, avoid a government shutdown.

The legislation that passed last week sets discretionary spending at $1.37 trillion dollars for the next two years, and sets defense spending at $738 billion for FY 2020 and $740.5 billion for FY2021. The budget deal allows Congress to pass into law appropriations bills that increase the federal government’s non-mandatory spending beyond the caps established in the Budget Control Act of 2011, which was set to expire in 2021.

Also, the budget deal involves $77 billion in offsets, and in order to pay for lifting the budget caps, the budget bill extends the 2% sequestration on Medicare providers through 2029 (two-year extension). According to the Congressional Budget Office (CBO), the move will increase spending by around 2% for most Medicare benefits through September 2027. Spending would then be reduced by 2% from October 2027 through March 2029, and reduced by 4% from April through September 2029. According to CBO’s estimate, the bill would not increase on-budget deficits in any decade after 2029.