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14 Maritime Reporter & Engineering News ? MAY 2013 LEGAL BEAT Jumping Off the Fiscal Cliff? It?s more of a Downward Slope for Maritime, Transportation, and Energy Programs You are not alone if you are bewildered by the talk in Washington about ?se- quester,? ?continuing res- olution?, ?fiscal cliff,? ?budget reso- lutions,? and ?debt ceilings.? Even those of us who think we understand what?s going on have trouble keeping up. This article will break down the talk into segments on the continuing resolution that funds the government for the rest of this fiscal year: the House and Senate budget resolutions, the upcoming debt ceiling fight; and, finally, the President?s budget request for FY2014. The focus is on mari- time, transportation and energy pro- grams. The Continuing ResolutionWhen the Congress cannot pass the 12 required appropriation bills to keep the government funded for a particu-lar fiscal year, it resorts to a mecha- nism called the Continuing Resolution or CR. This allows the government to remain open and to fund its pro-grams?usually at the previous year?s level of funding. This year, we have a mix of a regular CR and five appro-priation bills to fund the government through the end of the fiscal year, or September 30, 2013. As a result of her hard work, Senator Barbara Mi-kulski, Chair of the Senate Appropria- tions Committee, was able to reach agreement across the aisle and with her counterpart in the House, Con-gressman Hal Rogers of Kentucky, to add five specific funding measures for the Departments of Agriculture, Homeland Security, Commerce/Jus- tice/State, as well as the two funding measures already passed by the House of Representatives for the Department of Defense and the Military-Construc-tion-Veterans Affairs budgets. The five specific measures gave greater guidance and in some cases a budget boost to these departments. Since the Coast Guard is now housed in the Department of Homeland Se-curity (DHS), it received its funding under the DHS appropriation section of the CR. This includes $10.4 bil- lion for the Coast Guard, an increase of $79 million over last year?s fund- ing, allowing the Coast Guard to con-tinue its acquisition program for new ships and planes and to move its head-quarters to the grounds of historic St. Elizabeth?s Hospital in Washington, D.C.?s Ward 8. FEMA, the disaster relief and grants management arm of DHS, received a total of $2.5 bil-lion for State and Local and First Re-sponder Grants that include the Port Security Grants. According to DHS sources, these grants are estimated to be between $92 million and $93 million this year. Finally, Customs and Border Protec- tion (CBP) was funded at $10.4 bil-lion, an increase of $215 million over last year?s level, allowing full fund- ing for border security agents at our southern border. Unfortunately, due to differences of opinion with some House Members over federal funding for high-speed rail projects in California, the appro-priations bill for the Department of Transportation (DOT) was not added to the CR?although DOT remains largely funded at FY2012 levels under the CR. In fact, for programs that fall under the Highway Trust Fund, the CR includes appropriations consistent with the funding levels authorized by the Moving Ahead for Progress in the 21st Century Act (MAP-21), signed into law last year. As part of DOT, the Maritime Ad- ministration is funded at the FY2012 level minus the five percent cut attrib-utable to sequestration, described be-low. Since the Obama Administration has never included funding for the title XI loan guarantee program in its bud-get, it is unlikely that new funds have been appropriated for this program. Any new loan guarantees would have to be funded from residual funds. But, MARAD does have approximately $9 million for Small Shipyard Grants. Applications are due within 60 days of the President?s signing the CR, or 60 days from March 26, 2013. Funding for the Energy and Interior Departments, which have responsibil-ity for promoting renewable energy, including offshore wind development, falls within the general terms of the CR, or mostly to be funded at last year?s level plus the sequester cuts. In addition, Energy?s program to pro- mote renewable energy was specifi- cally cut by $11 million. As part of the Commerce Department, the Na-tional Oceanic and Atmospheric Ad- ministration (NOAA) did receive its regular budget. The budget contains $5 billion for NOAA, which is $111 million above fiscal year 2012, but $50 million be-low the President?s request. Senator Mikulski directed that full funding be provided for weather satellites and critical weather predictions. The bud- get for EPA continues at FY2012 lev- els, in general, less the sequester cut. At this time, we are waiting to learn how much money is available for grants for diesel engine replacement through the popular DERA program. The Sequester Cuts On March 1, 2013, federal agen-cies were hit with a 5 to 7.8 percent across-the-board cut as a result of sequestration. Sequestration, a term derived from the Budget Control Act of 2011, is a ?process of automatic, largely across-the-board spending re- Joan Bondareff , of counsel at Blank Rome, focuses her prac-tice on marine transportation, environmental, and legislative issues, and represents clients in many industries and state and local governments. Email: Bondareff@BlankRome.com With the able assistance of Abby Jagoda, Member, Blank Rome Government Relations LLC.MR #5 (10-17).indd 14MR #5 (10-17).indd 144/30/2013 9:28:32 AM4/30/2013 9:28:32 AM
