FY 2009 Budget Update

June 10 , 2008

The conference report on the Budget Resolution for Fiscal Year 2009 passed both the House on 6/5/07 by 214- 210 and the Senate by a vote of 48- 44 on 6/4/08. Senators Warner and Domenici withheld their votes to “pair” with the Senators Byrd and Kennedy, who were both hospitalized at the time of the vote.

Thanks in part to your advocacy efforts, the budget increases spending by $24.5 billion more than the President’s budget, leaving space for modest increases in human needs programs that have been neglected over the past six years. The compromised discretionary number is closer to the higher House number than the Senate number. The budget maintains pay-as-you-go rules, requiring that legislation which increases spending or decreases revenue be offset by other spending reductions or tax revenue increases. It assumes that the Alternative Minimum Tax will be adjusted for FY 2009, and allows the extension of the child tax credit, the 10% income tax bracket, and correction of the marriage penalty. It assumes that the estate tax will be held at 2009 levels.

Congress will now begin work on appropriations bills, but most of the 12 bills, with the possible exceptions of Defense, State-Foreign Operations, Homeland Security, and Military Construction-Veterans’ Affairs, are expected to be held until next year to avoid threatened vetoes on any spending exceeding the President’s budget.